The CMO Interview

Selling Ciao Bella's Premium Gelato on a Plain-Vanilla Budget

Deborah Holt Ups Retail Sales With Road Tour, Promotions

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NEW YORK (AdAge.com) --Ciao Bella was primarily known as a food-service supplier and cult-epicurean brand when Deborah Holt joined the company in 2003. Since then it's just as likely to be known outside of foodie circles as it is in them.

Deborah Holt
Deborah Holt
Ms. Holt came to the gelato maker after years of selling business-solutions software to companies such as MetLife and AIG, and managing customer experience for Progressive Insurance. Ciao Bella hired her as sales and marketing manager to improve its customer experience. At the time that set was primarily restaurateurs, not consumers. Today, all that's changed. When she joined, marketing took a backseat to sales. "But this past year it's really become a brand company that does sales. Now the brand is leading the decisions," she said.

Promoting a brand on a million-dollar-or-less shoestring budget requires pluck and some grassroots effort, but the Irvington, N.J.-based company has also had its share of help. It was the subject of a 2004 episode of "The Apprentice," Oprah featured it on a "Favorite Things" episode in 2007, and it's been in food and lifestyle magazines.

The product is its own best marketing, Ms. Holt said. Now, as VP-marketing, she's spearheaded an ambitious sampling strategy, which includes a two-year-old Ciao Bella tour that takes its gelatos and sorbets on the road to events and towns all over the country. The brand, which is trying to carve out a niche among giants in the freezer case, is one of the more expensive ice creams at most retailers, and Ms. Holt said the recession has spawned some additional promotions.

Today 33% of Ciao Bella's business comes from sales to restaurants; the remaining 67% is direct to consumer. The company has retail outlets, primarily in the Bay Area and New York. It also has approximately 100 independent gelato bars in airport kiosks and specialty stores as well as in retail stores such as Whole Foods.

Reporting to CEO Stan Fabian and part of a small leadership team that includes the VP-finance, VP-operations and the president, she said her primary marketing concern these days is balancing growth with brand equity and helping the brand stay true to its roots. "The original owner fell in love with gelato on a trip to Italy 26 years ago; we remain a chef-inspired company," she said.

Ms. Holt sat down for a gelato and an interview with Ad Age recently at the Ciao Bella counter in New York's Grand Central Terminal, where she talked about expansion, competition and wooing consumers to a premium brand in a recession.

Ad Age: You have expanded pretty significantly over the past five or so years. What's the goal there?

Ms. Holt: We want to be wherever you shop. If you were at the little shop across the street, at the farmer's market, you might go into Fairway, if you're in all those places, you might be able to buy Ciao Bella. We're in Targets here in the Northeast now. We're doing some rotations with some of our sorbets in some of the Costcos.

Ad Age: Do you guys worry about becoming too mass?

Ms. Holt: There's some worry. As you go more mainstream, you're not as niche. So we still try to come up with new flavors for the people who like niche. If you go to Citarella or Whole Foods, you can sometimes find three shelves of Ciao Bella -- so there are still some flavors that aren't everywhere.

Ad Age: How do you take on your competition, which are generally well-known ice cream brands owned by deep-pocketed marketers?

Ms. Holt: This year we did some in-store banners in the freezer section. It was another way to compete with the amount of space that Häagen-Dazs and Ben & Jerry's get. It helps us in our newer markets drive awareness and educate people [about gelato].

We also rally around one idea as a way to save money. We don't do 10 different ads. Last year we went a little bit wider and weren't as focused. We did a big event and didn't see any kind of real lift from it because people like ice cream no matter where you go. If you're there with a truck, everybody would eat it, but they might not go and buy right away. This year we put all the tour events around retailers or at [associated events] so the push was right to that retailer.

Ad Age: How have you leveraged social media?

Ms. Holt: With the rapid rise of social media, it became very clear to me that our fans have a powerful voice, and I needed them to help me spread the word about how great Ciao Bella gelato and sorbet taste. We jumped into social media with both feet this spring. Someone recently mentioned to me that the biggest mistake you can make in social media is not doing it. With no budget dedicated to social media, I began tweeting and updating Facebook statuses at night, before and during work. We incorporated it into our communications strategy. My team is required to have Facebook and Twitter open daily. Consumers are responded to in real time.

Ciao Bella revealed its new package design last week at the Natural Products Expo. It is the first package design change to our standard pint line in 10 years. Leading up to the trade show, we placed a sneak peek on Facebook and Twitter.

Ad Age: Some big retailers have been cutting the number of brands they put in store. How do you try to keep yourself in the mix?

Ms. Holt: We try to show we still have growth, show that against competition and show that we have something that will excite the category. We want to offer that variety and be the third brand that you consider. We're also kind of a lifestyle brand -- we're quirky, fun, sophisticated -- through our brand building.

Ad Age: How have you persuaded people to try your brand, given that it's relatively upscale and we're in a recession?

Ms. Holt: We definitely had more promotions this summer. A classic example of our pricing promotion was during July, which is ice cream month. We're not going to compete with Häagen-Dazs or Ben & Jerry's at two for $4 or two for $5. But our pricing strategy is about multiples, because with Ciao Bella it's about sampling. We did a bit of research on our sampling and found the repeat from the trial is pretty high. I battled our sales folks for about three years because I would see at the retailer that they would just mark it at $3.50, and they'd say you can't control what they do. And I'd say our job is to explain to retailers why that's important for Ciao Bella. The multiples will drive the repeat purchase. This year it paid off.

Ad Age: Has your pricing strategy changed?

Ms. Holt: I do the pricing strategy, along with the CEO. When I first started, there was a suggested retail price of over $5. It's down considerably. We've looked at efficiencies in purchasing, production and on a national suggested retail price we now say we're around $4, but it can be more or less, depending on where you live.

Ad Age: There's often talk of people "trading down" in a recession. Have you seen that with your product?

Ms. Holt: Our unit sales of pints are up about 40% this year -- that refers to the pints people bring home. The food-service part of the business is hard because of the economy. But people still treat themselves. Maybe you'll trade down to private label on vanilla, but if you're looking for something more exciting, you're less likely to trade down. Our flavor profiles aren't too crazy, but they're unique enough that you'll see there's real value there. We want to be that ice-cream brand you go to when you want to treat yourself at home, not just bring to a dinner party.

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