Case Study

Neptune Gourmet Seafood Company

1) Central issue of the Neptune

The Neptune Gourmet Seafood company produces and sells High-end seafood products and has a premium image. Now Neptune is facing the excess inventory problems. In order to solve the problem, Rita Sanchez came up an idea that cutting down the price of Neptune Gold by 50%, but the marketing director Jim Hargrove didn’t agree with her.

2) The source of central issue

The Neptune wanted to hold its premium image, Neptune made a huge investment in new technologies to improve the catching efficiently. The new laws also led the increase of catches. Neptune is facing accumulating excess inventory problem, it can causes the issues like tight up of cash and loss of profit margin. In order to reduce excess inventory, the Neptune needs solutions.

3) Solution & Ramification

1. Cut the Neptune Gold price by 50%

2. Establish a New brand to the existing market with lower price than the High-end brand.

3. Supply retailers with private-label products.

4. Sell the current high-end products to a new market.

5. Combine: Establish a new brand to a new market with low price. (e.g. South America)

4. Recommendation

In order to solve the excess inventory problem, we can use portfolio to get the best option to solve the excess inventory problem without affecting company’s premium image.

For the long term, Neptune can establish a new brand with a total different package to the existing market by using current channel. However, ‘Neptune’s Silver’ can’t be the new product’s name. Once customer discover there is no difference between Neptune’s Gold and Neptune’s Silver, Neptune’s Gold may lose customers and have a negative impact on the company’s premium image.

Secondly, for the short term, Neptune can also supply the wholesalers without their brand name and retailers with private label at the same time to reduce the excess inventory.

Launching a new brand to a total new market (e.g. South American) is a good...