Sig. Cesare Preve, marketing director for the Gallo brand of rice, was reviewing Gallo's current market position in three different countries. Volume share was 21% in Italy, 17.5% in Argentina, and less than 1% in Poland respectively. Preve was trying to determine a strategy for deepening Gallo's market penetration in each country. One of the questions that needed to be answered included whether or not resources should be focused in new high growth markets or should he focus on mature markets. Another question was if he could take what was learned from success or failure in one country to another country.
Gallo was the market leader in rice in Italy. It was a trusted brand and known for good quality. Eighty-five percent of retail rice sales in Italy were white rice and 15% consisted of paraboiled varieties by volume. Paraboiled and specialty rice were growing approx. 10% per year while white rice was losing 1%-3% share annually. Gallo's white rice volume accounted for 17.3% of Italy's white rice volume. Gallo's Blond line volume share in Italy was 35.4%. Their super-premium line was 1.2% volume. Gallo was carried in grocery stores that accounted for 80% of all grocery sales in Italy. These stores generally stocked 5 Gallo products (2 whites, 3 parabo
Preve was concerned that he may begin to lose market share in the paraboiled rice segment. Retail trade margins on Gallo's blond line were around 1% and around 7% on the competitor Flora's paraboiled lines. He was concerned that chains would develop their own rice lines to improve their bottom lines. I would recommend that Preve work on monthly promotions with the major grocery chains ...