RED Island extra virgin olive oil, the newest brand from listed olive oil producer Piquant Blue, will be the focus of an Australian food promotion by European food retailer Oil and Vinegar.
RED Island extra virgin olive oil, the newest brand from listed olive oil producer Piquant Blue, will be the focus of an Australian food promotion by European food retailer Oil and Vinegar.
The promotion follows a recent distribution deal through Oil and Vinegar, which has 100 stores in Europe and is embarking on a major push into the US.
On the local front Piquant Blue, which markets the Njoi brand, has secured olive oil distribution through selected Woolworths, Action and Dewsons supermarkets.
Oil and Vinegar will expand significantly next year, according to Piquant Blue export manager Trudie Michels, providing solid growth opportunities for the Red Island export brand.
“They will have 11 stores [in the US] by next year, and will have 350 stores by 2006,” she said.
“They did a trip around Australia to find a company to supply olive oil and they selected us. They are doing an Australian promotion in March and April in Europe and the US, and Red Island will be the focus.”
Piquant Blue executive director Don Hancey said the company had shipped 24 containers, or 12,000 litres of extra virgin olive oil, to Oil and Vinegar.
He and Ms Michels are flying to San Francisco early in the new year to promote the products.
“Sales are slow right now but we think they will take off in January and February, after the festive season,” Hancey told WA Business News.
“We’ve got a distributor over there who has taken a container worth $110,000.”
Piquant will continue to roll-out its brands at a local level.
Currently there are 11 Action stores stocking the Njoi range, with this number soon to grow to 20.
Njoi is also sold at 10 Dewsons supermarkets and eight Supa Valu sites.
Woolworths is selling its Red Island label, while Action and Dewsons stores are selling the Njoi range.
Njoi is also sold to independent grocers and speciality shops across Australia.
While Piquant doesn’t own any olive groves it contracted 100,000 litres of oil last harvest, three times the quantity of the previous year.
Piquant Blue sales of extra virgin olive oil in the 14 months to June 30 2004 were $279,946 with a gross profit of $22,777.
Piquant Blue made a loss of $1.3 million in the same period.
Its marketing journey thus far has mirrored competitor Olea Australis, which launched its supermarket brand, Dandaragan Select, through Coles Supermarkets.
However, Olea has been plagued by capital issues that were heightened when it had to scale back a $5.1 million capital raising by almost half.
Its managing director, Geoff Newing, and executive chairman John Simpson have since left the company and the new management announced significant cost cutting measures at the recent annual general meeting.
Mr Hancey, a former consultant to Olea, is philosophical about his competitor’s woes and said it had done a good job of educating consumers about the quality of Australian oils.
But Mr Hancey believes further education is needed to prompt more consumers to trial the Australian products, many of which are more expensive than imported competitor brands.
“We need people to understand that they pay a couple of bucks more but they get a much better taste and flavour,” he said.
“The more people try it the more they will use it. It’s like coffee; when you have a whole bean coffee it’s hard to go back to instant.
“We think there is huge opportunity because Australia imports a lot of oil, I think its more than 85 per cent, there’s a huge amount of room.”
Mr Hancey said launching a range of regional-branded oils, including the Murray River Lands (Victoria), New England (NSW), Limestone Coast (SA), and Margaret River, was designed to tap in to consumers’ existing food and wine knowledge.
“People understand that different regions produce different flavours and so we’ve bottled oils from olives grown in different regions to reflect that, and hope that people understand that one might be more peppery than the other and use a range of oils to suit their needs,” Mr Hancey said.
“We don’t have to sell the concept because people already understand it.”
RED ISLAND EVOO
- Piquant Blue has secured a distribution deal for its Red Island extra virgin olive oil through European retailer Oil and Vinegar.
- Oil and Vinegar will use Red Island evoo in an Australian promotion when it expands into the US next year.
- Distribution deals have been struck with Woolworths Supermarkets, Action Supermarkets, and Dewsons Supermarkets.
