Speech for John Schramm

Tilapia Marketing Institute

Honduras Aquaculture Conference

August, 1999

I’m going to talk to you today about a new generic marketing campaign that is being run by the Tilapia Marketing Institute or TMI as it is becoming known. I think the easiest way for me to present TMI to you is to do so in a question and answer format. Before I begin, I have a question for all of you here:

Before you give me your answer to that question, let me answer some questions you are likely to have:

The first question is:

A generic marketing campaign is conducted to benefit a product or grouping of similar products, without identifying brand names or product origins. In the case of Tilapia producers and suppliers, the campaign is promoting farmed Tilapia, not a particular specie or place of origin. Because generic campaigns do not promote one brand over another, they have the advantage of tremendous credibility with consumers and the media.

That’s easily answered because hundreds of generic campaigns currently are supported and funded by food companies and food organizations. In considering this program, TMI examined several campaigns currently in place to successfully build demand. Generic marketing campaigns are run by organizations such as Alaska Seafood Marketing Association, Catfish Farmers of America, Virginia Marine Products Board and the National Fisheries Institute is well on the way to gaining the funding necessary to generically promote seafood to the U.S. consumer.

Among non-seafood producers, successful generic campaigns have been run by organizations as diverse as the American Dairy Association, American Egg Board, Beef Industry Council, California Raisin Advisory Board, International Apple Institute, National Honey Board, National Pea & Lentil Association, National Yogurt Association, Peanut Advisory Board, Popcorn Institute, Wine Institute and many, many more.

These campaigns are run with budgets as large as twenty million dollars and as small as $100,000. Generic campaigns are popular for a simple reason: When groups of producers band together to promote their product, they are more likely to succeed than if they go it alone.

A generic campaign is a cost-effective approach with high impact. TMI runs its generic campaign to supplement and strengthen individual brand or company promotions. TMI operates where individual producers can’t afford to – with the U.S. consumer. Our singular goal is to:

This is commonly referred to as "demand-pull" marketing. Most producer campaigns target trade buyers and never get to the consumer. Their objective is to push supply through the distribution system. These campaigns, known as "supply-push" marketing can be effective when supply is limited and will remain so. However, they become counter productive when supply exceeds demand. In this situation, a "supply-push" approach simply tells the trade that your product is plentiful and should be treated as a commodity. Therefore, buyers put enormous pressure on pushing down prices. If that sounds familiar, it’s because it is how the seafood industry has typically operated in the past.

The problem with "demand-pull" programs that target the consumer is that they are more costly to implement than "supply-push" campaigns. But by joining together and funding a generic program cooperatively, Tilapia farmers can realize a great deal of benefit for much less money than if individual companies pursued promotion on their own.

There are three common fears with generic campaigns that I would like to address now:

The answer is that generic campaigns benefit all producers by raising consumer awareness of Tilapia's fine attributes. These campaigns support your sales and marketing efforts whatever their size and focus. Greater awareness of Tilapia stimulates more interest in product trial, which stimulates higher purchases. As more people purchase the product, a certain percentage will become regular purchasers and thereby increase overall demand. It’s that simple. All you have to do is look at the numbers to recognize what it takes for our campaign to be successful.

The US Department of Agriculture estimates that only 3% of U.S. consumers even know what Tilapia is. That’s about 8 million people. We think that number may actually be high but for this example, let’s use it. If we can convince one-third of this group or get an additional 1% of consumers to try a meal of Tilapia once, we add nearly 2.1 million pounds whole weight to demand. That’s if they only eat it once in a year’s time. We believe through this campaign, we can get consumers to eat it more than once and that, starting from our very low base, we can get more consumers to try it.

We all know that markets don’t remain static. In a shrinking market, suppliers fight for each other's share of the market. In an expanding market, like this one, there are opportunities for each company's sales to grow. The overall goal of the generic campaign is to increase the total size of the market by raising consumer demand.

The answer is that a generic campaign for seafood will be a wonderful assist to our work for Tilapia but it does not replace it. More people may learn that fish and seafood taste great and are good for you but that doesn’t mean they’ll know more about Tilapia. I am reminded of a T-shirt that one of our members had printed that says: "Tilapia is a) a Siberian lap dog; b) a tasty pudding; c) a mild-tasting white fish: or d) none of the above. I can tell you that even those people who eat a lot of seafood don’t select the right answer. We need a Tilapia campaign so that U.S. consumers know what Tilapia is, how great it tastes, how easy it is to prepare, and how healthy it is to eat.

Now that I’ve addressed generic campaigns, let me answer a few questions about TMI?

TMI is a consortium of producers and suppliers of goods and services to the Tilapia industry that want to see our industry grow and flourish. We are grouping together and funding a marketing communications program to increase U.S. consumer awareness of Tilapia. We are incorporated as a non-profit organization in the U.S. TMI has a board, executive committee and by-laws so that all members are treated fairly and equitably.

The best way to answer this is by pointing to some of our results. When the AP Radio Wire Service reported, earlier this year, on John Glenn's experiments with Tilapia in space to its 4,000 member stations, the story came from TMI. A TMI media relations specialist worked with journalists from AP Wire Service and a number of other publications who covered the story. As more Americans hear the name "Tilapia," familiarity and awareness of the product will increase.

TMI works actively with journalists around the US to obtain coverage of food stories comprising recipes and food reviews; of business stories that cover the growth of this fledgling worldwide industry; of technology stories discussing the different ways in which Tilapia is raised; and of travel stories which enlighten consumers that this is a product which can be found on fish farms from Indonesia to North Dakota.

Our generic campaign focuses on Tilapia's mild flavor, recipe versatility, and widespread availability...delivering this message to consumers via top magazines and newspapers, well-known television personalities, and respected chefs. We are sponsoring events attended by well known chefs and food writers such as the Sakonnet Seafood Festival held in Rhode Island earlier this summer.

We've placed Tilapia stories in newspapers in Washington D.C., Baltimore, Dallas, Florida, Houston, Boston, Rhode Island, Eastern Connecticut, and Northern California. Better Homes & Gardens magazine will write about Tilapia next Spring and Cooking Light also will have a feature in the near future. Trade stories also have appeared in publications such as Restaurants & Institutions that are read by chefs. These articles and events take place because we are using trained public relations professionals who understand U.S. media coverage to get us coverage about Tilapia.

We have to look at other campaigns for some of the answers here and the results offer an impressive return on investment. The Catfish Institute, for example, has grown from a $10 million dollar business to a $600 million dollar industry in less than 15 years. Much of the growth was accomplished in a few short years as a direct result of the generic marketing efforts of the Institute. The country of Chile has enjoyed similar results from their generic campaign: in just over three years, Chilean exports to the U.S. increased by more than 40%.

It is important to note that both the Catfish Institute and Chile started their campaigns with modest budgets of much less than one million dollars and increased the size of the program over time.

That brings up an important question:

We have raised $250,000 by producers assessing ourselves on a sliding scale based on total production. For the first 3 million lbs. of production, we pay 1¢ a pound. For the second 3 million pounds of production, we pay 1/2¢ per pound and for all production over 6 million pounds, we pay 1/4¢ per pound. With this formula, a producer of 500,000 lbs. pays $5,000 and a producer of 7,250,000 lbs. pays $48,125. It’s really quite simple but if it sounds confusing and I can help you figure out how to apply it to your production afterwards. Suppliers of packaging, freight services, equipment and other products and services are joining for a flat fee of $2,500.

TMI also is actively seeking supplemental grant funding from multi-national grant making organizations among others to grow the campaign. We are meeting with organizations as diverse as the World Bank and United SoyBean to obtain additional funding.

While each of the members of TMI has made a significant financial contribution to launch the campaign and support its activities guaranteeing the 1999 marketing plan, we need membership from all producers and suppliers to the Tilapia industry to accomplish more.

It goes to support a staff of marketing professionals, for sponsorships and events, and all types of promotional work. In 1999, our first year, we have completed market research to define our target and competitive advantage, created an organization structure, logo and overall identity, conducted an active media relations program targeted at print and broadcast journalists, created culinary partnerships with well-known chefs and culinary schools, sponsored events for chefs and interested consumers and held seminars for food professionals.

With additional support in 2000 from people like yourselves, we can take on more media relations work such as newsletters and television programming, a home-meal replacement promotion program in supermarkets, Internet marketing, print recipe brochures for professional and amateur chefs, have an industry spokesperson who attracts media interest and eventually as our friends in the catfish industry have already done, initiate an aggressive consumer advertising program.

TMI is emerging as a potent marketing organization that will play a major role in setting the marketing standards for how Tilapia is sold in the U.S. leading to a sustainable and significant competitive advantage for those companies who participate.

Now, that I’ve answered a lot of the questions that certainly must be on your mind, let me return to the question I raised at the beginning of my remarks that I want to ask each of you:

With your help and support, we can make Tilapia a well-known and popular meal among U.S. consumers.

Thank you.