Brand Repositioning in the Food Industry
In May 2006, Luís Pereira Santos, newly appointed marketing director of Sovena Consumer Goods Portugal, had just analyzed the market shares of the VêGê brand and concluded that the situation was worsening with each passing month.
The meeting with the board of directors was scheduled for the following month, and Luís knew he had to present a proposed solution to this problem. He scheduled a meeting with his team for the following morning and also called the sales director to join them. However, in a prior conversation with the brand manager for the edible oils category, Rodrigo Pinto, it became clear that their concern should focus on a clear understanding of the brand portfolio they had in the edible oils market, as well as the objectives and functions of each brand.
The Sovena Group operates in the global olive oil and edible oils market. The company seeks to promote specialization at each stage of the value chain for edible fats, from production to distribution. Sovena has three business areas covering the entire value chain of olive oils and olives, edible oils, and soaps: agricultural production (Sovena Agriculture), industrial processing (Sovena Oilseeds), and distribution of consumer food products (Sovena Consumer Goods).
Sovena Oilseeds aims to dominate the edible oils value chain. It supplies seeds for planting oilseeds and purchases seeds at the end of the harvest for the production and subsequent refining of edible oils. This company sources crude oils and seeds from markets in Ukraine, Argentina, France, Spain, and Portugal, and serves the Portuguese and Spanish markets. The company owns the largest independent European extraction and refining facility—that is, one not belonging to any of the three major multinational groups in the sector.
Sovena Oilseeds Portugal operates a facility where sunflower, soybean, and rapeseed oil extraction and refining take place. However, this facility also allows for the reception of crude oils for refining, seeds for extraction, or already refined oils. This production unit supplies not only Sovena Consumer Goods Portugal but also some of the other players in the domestic market and the animal feed market, with meals resulting from the oil extraction process.
Sovena Consumer Goods targets the end consumer. In each market where it operates, it bottles, packages, and markets products ranging from olive oils to vegetable oils, including olives, vinegars, and soaps. Manufacturing operations are spread across Portugal, Spain, the United States, and Tunisia, and the company also has a commercial presence in Angola and Brazil, regularly exporting to more than 70 countries across five continents. Sovena Consumer Goods USA is today the largest olive oil importer in the United States, responsible for more than 60% of private label brands in the North American retail market.
Sovena Agriculture operates owned or leased estates for olive grove cultivation. This activity is distributed across Portugal, Spain, and Morocco, and its objective is to continue expanding the cultivation area until reaching 10,000 hectares.
