Bens and Jerrys Competitive Analysis - Term Paper Example

?When it comes to ice cream, we all have our favorite brands and flavors. There are two leading brands when it comes to premium ice cream, Ben & Jerry’s and Haagen-Dazs. Here our main focus will be on Ben’s and Jerry’s. But we will discuss the brand of Ben & Jerry’s in comparison with its competitor Haagen-Dazs. This analysis will help in finding out the areas where Ben’s and Jerry’s stands better against its competitor as well as the areas where Haagen-Dazs is ahead of Ben’s and Jerry’s. This analysis will help in finding out the areas where Ben’s and Jerry’s should improve. On the basis of the entire analysis, this paper will provide some recommendation to Ben’s and Jerry’s regarding its marketing strategies. Review of Ben’s and Jerry’s- a competitive analysis Ice cream of Ben and Jerry has started their journey in a well to do manner. Actually there were two people named Ben Cohen and Jerry Greenfield who wished to make bagels, but they found their decision to be very expensive in order to fulfill it and so they opted to make ice creams instead of bagels. (Ben and Jerry’s p. 1) Ben Cohen and Jerry Greenfield have used special characters in order to promote their brand and also which are simple to pronounce, recognize and also can be remembered for long time. Their brand logo had cow and green environment behind which depicts awareness of quality and benefits. Ben and Jerry have always tried to acknowledge their customers that they always use natural and fresh milk while keeping the environment completely clean and green at the time of producing ice creams. In order to prove and promote their mission, Ben and Jerry have used special slogan like “From cow to Cone”, “Lick Global Warming”, ”Organic Ben & Jerry’s”, and “50 Ways to Promote Peace”. (Ben and Jerry’s p. 1) In order to ensure that there is an existence of brand awareness in specific segments, because Ben and Jerry targeted market covers all age group people, that is from kids, adults to elderly people, hence for kids they have tried to make the package for ice creams more interesting like the packaging was done with papers having pictures of favorite cartoons such as Disney characters or Warner Bros. For adults and elderly people, they would take into consideration more about the nutrition facts, taste, and low-fat ice cream. Thus, it will be more interesting for them to see “Organics, low sugar, or low fat Ice Cream”. (MarketingWeek p.1) In order to promote and develop their brand, Ben and Jerry is using the brand extension policy. They have produced thousand of ice cream flavors under the name of one successful brand, which of course is “Ben & Jerry’s”. They have extended its brand to organic ice cream, original ice cream, scoops menu, bars original ice cream, single original ice cream, and single novelties with different choice of taste in each product. (MarketingWeek p. 1; Ben and Jerry’s p. 1) But the journey of Ben and Jerry was not so smooth as their ice cream blends. They had a hard and fierce competition with a brand named Haagen-Dazs. These two brands have dominated the global premium ice cream market and one would be shocked to observe that the two companies could be so similar yet so different in various angles. Haagen-Dazs does claim to use the best ingredients, from all over the world.   They also claim to use pure ingredients.   Haagen-Dazs started out in the 1920’s and in 1983, Haagen-Dazs was bought by Pillsbury.   Haagen-Dazs was the first to market ice cream bars for a more adult crowd. Haagen-Dazs were the pioneers in the market for creating distinctive and indulgent taste experiences by marketing to an untapped segment - the adult ice cream lovers. The Haagen-Dazs brand quickly developed a loyal following. Its early success was created by word of mouth and praise. They do not, however, have the fun and creative names, which means Vanilla Swiss Almond is not something that is going to catch your eye and make you remember it. But some of their flavors are really amazing and occupies top positions in the super-premium market of ice-cream. For example, their Strawberry Cheesecake is one of the best selling products. It’s the perfect blend of cheesecake flavored ice cream, strawberry swirl, and graham crackers crust pieces. Another very popular flavor from Haagen-Dazs is Toasted Coconut Sesame Brittle and it is really tasty. (Ctterill and Haller pp. 7-14) Haagen-Dazs has obtained its current competitive strengths to establish premium pricing from developing the brand with an attached history of perfection and luxury. They used the finest ingredients to deliver product excellence, investing in consumer research to understand tastes and preferences of customers, using selective distribution and did not mass market until the minimum critical mass of opinion leaders were established. They did not change their objectives in between, using creativity and innovativeness to support brand identity. Thus it can be said that while, Ben’s and Jerry’s had focus on expanding their product range by inventing new flavors, Haagen-Dazs is mainly concerned with its quality of its products. It is not as much fascinating and interesting as Ben’s and Jerry’s in inventing new flavors at a rapid pace and giving them creative and attractive name, rather they were more focused on increasing their customer base by providing them with enriched taste with pure and high quality ingredients. (Gilbert, p.1) Fig. 1 Brand Analysis and Comparison with Competitor Brand Ben’s and Jerry’s are very carefully in setting its product promotional and marketing strategies. This section will analyze the brand of Ben’s and Jerry’s in comparison with its rival Haagen-Dazs. This section will mainly focus on pricing strategies, Market segmentation, distribution, and positioning of the products. Pricing: Since Ben’s and Jerry’s cater to super-premium market, their products are prices at high level. However, they always pay much attention on pricing their products at competitive level in the sense that at the time of setting their prices, they always look at the prices that their competitors set. Thus in terms of pricing, they have a tendency to set lower price than their competitors. Thus, the prices of Ben’s and Jerry’s products are comparatively cheaper than that of Haagen-Dazs. However, Haagen-Dazs are not conscious about pricing s much as they are about the quality of their products. They are not much bothered about whether the prices of their products are comparatively higher than the products of its competitors. They do not always try to set the prices lower than their competitors. No price discounts or special offers are given by Haagen-Dazs to keep in line with the luxury and prestige associated with the brand - for the health conscious, Haagen-Dazs have not reduced price to try and attract them simply because this segment already exists and they are willing to pay the same amount and purchase the product. (Gilbert, p.1) A very interesting feature about Haagen-Dazs is that while its competitors are ready to set their prices according to economical conditions, it is more concerned about keeping its customer base by maintaining its quality. In the recent event of economic recession, market demand has reduced in one hand, whereas costs of production have increased. In order to deal with this situation, Haagen-Dazs has undertaken a very innovative step. It has decreased the amount of ice cream per carton. Right now the company is offering 14 ounce of ice-cream per carton instead of 16 ounce that they used to offer earlier. They are offering lower quantity of ice-cream at the same prices. The interesting thing about this move is that they have not sacrificed their quality under increasing costs of production. While its competitors like Ben’s and Jerry’s are either increasing the prices or reducing the quality, Haagen-Dazs has maintained its quality by sacrificing two ounce of ice-cream. Given the nature of the market they cater to, a sacrifice in quality may reduce customer base drastically, while a fall in quantity per carton without sacrificing quality has the potential to maintain the customer base. (MillwardBrown. P.1) Positioning: The principle focus of Hagen-Dazs was superior flavor and texture and their definition of quality extends beyond Ben and Jerry’s. From the ingredients they choose to the recipes they develop, from the packaging materials they select to the care with which they deliver the ice creams, from the ambience of each Haagen-Dazs cafe to the attention with which they serve, the Haagen-Dazs brand quite obviously signifies its commitment to perfection. Ben’s and Jerry’s lacks a little in the area of perfection in terms of brand quality in comparison with Haagen-Dazs. However, at the end of the day, the customers would base their decision on the tangible aspects of the brand such as the taste of the products, the quality of service offered at the cafes and so on. Ben and Jerry’s are quite efficient in these fields. They are very much careful about offering the best flavors. They always emphasizes on providing best quality services as well. In terms of innovating new flavors, Ben and Jerry’s are more competitive and better than of Haagen-Dazs. (Barna p.1; MarketingWeek p.1) If we consider product-wise, then Hagen-Dazs has always puts its focus on ensuring the high quality and luxurious taste associated with the brand by using best selected ingredients from all over the world and ensuring that fresh cream is used for a rich creamy flavor, fresh skimmed milk for body and texture and fresh egg yolk for delicate flavor As a matter of differentiation, they advertise that their ice cream is “All Ice Cream” by ensuring that the ice cream is perfectly rich because it contains no excess air. Further, unlike mass marketed brands, no artificial flavorings or colors are used. Haagen-Dazs prefers to find better natural alternatives and make sure that their customers know about this. In terms quality, Haagen-Dazs is a bit better than Ben and Jerry’s flavor of ice creams. (Barna p.1; MarketingWeek p.1) Market Segmentation: It is the process of recognizing a specific set of characteristics that differentiate one group of consumers from the rest. In respect to ice creams, although its demand is quite high, the market can quite easily be segmented on bases of prices and taste patterns. Some individuals prefer high-quality ice cream made with real sugar and cream because of its taste while others if even cannot tell the difference in quality but would buy ice creams primarily based on price and availability. Low-priced competitors are into mass marketing while premium priced ice creams makers have followed a niche strategy to target that one single segment of the society consisting of affluent upper-middle to upper class people of the society. (Raphel, 4-7; Gilbert, p.1) Both Ben’s and Jerry’s and Haagen-Dazs use a few main segmentation bases for dividing their market, namely, demographic, socio-cultural, etc. Under demographic segmentation, both of these two companies focus on the consumers’ income brackets. Both of their products are mainly aimed at the affluent section of the society. Both of these two companies do not segregate flavours by gender, however, Haagen-Dazs has a tendency to highlight he romantic and sensuous image of ice-cream by featuring couples in all their international adverts. Unlike, Ben’s and Jerry’s, Haagen-Dazs tends to link its ice creams directly to sex in order to highlight that the indulgence and pleasure felt is similar in both cases and just as fulfilling for inner desires. (Raphel, 4-7; Gilbert, p.1; Brandweek, 1) The socio-cultural segmentation looks at various cultures and nationalities and their preferences. Certain cultural groups tend to have similar needs especially when it comes to food, confectionery and drinks. For this, Haagen-Dazs has taken into account various national tastes and preferences in their innovative product line. Ben’s and Jerry’s has already started to follow its competitor’s foot prints. (Dibb et al. 46-47) Using these segmentation strategies, Haagen-Dazs has narrowed down its target market to cater to affluent, pleasure seeking adults only who are self-depended, can make their own buying decision, generally brand conscious, and relatively lees elastic to price change, but more elastic to quality change. Ben’s and Jerry’s, however, has considered a wider target market. They try to meet the needs of kids and families as a while. Thus, it can be said that Haagen-Dazs is practicing in a much more niche market segment. (Dibb et al. 46-47) Illustration of market segmentation of Ben’s and Jerry’s: Fig. 2 Illustration of market segmentation of Haagen Dazs’: Fig. 3 Illustration of Target market of Ben’s and Jerry’s Fig. 4 Illustration of Target market of Haagen Dazs Fig. 5 Recommendations: On the basis of the competitive analysis between Ben’s and Jerry’s and Haagen Dazs, it can be said that, in many areas Hagen Dazs has been ahead of Ben’s and Jerry’s. In order to have a smooth growth in future, the following three steps are recommended for Ben’s and Jerry’s. First, like Haagen Dazs, Ben’s and Jerry’s should also put its prime focus on quality maintenance and promoting products by highlighting its unique quality features. The market Ben’s and Jerry’s caters to is super premium ice cream market where customers are very sensitive to quality. The better a company presents and maintains its qualitative features, the ore market share it will enjoy. Like its competitors, Ben’s and Jerry’s should put more focus on using far better quality ingredients and highlight this feature to the potential customers. Second, in turmoil economic condition, increasing prices is a bad option. Hagen has responded to the situation by reducing quantity per carton at the same price without sacrificing its quality. In this position, if Ben’s and Jerry’s keep the price and quantity same, then it might raises question among customers over the existing quality of the products at the event of increasing costs of ingredients. Hence, to retain its customer base, Ben’s and Jerry’s may follow the same footstep as Haagen Dazs. Third, Ben’s and Jerry’s should focus on more niche market. Without targeting the entire affluent society as a whole, it should target adult customers who are self-dependent and can make their own purchasing behavior. Market for kids and teenagers are more price sensitive and less conscious about quality. Adults, on the other hand aer less price sensitive. References: 1. Ben and Jerry’s. Our story. [Online]. Ben and Jerry’s. 2008. Retrived form http:// www.benjerry.co.uk/ourstory / on 18th April, 2011. 2. Ben and Jerry’s. Support Home Page: Cost of Ben and Jerry’s. [Online]. Ben and Jerry’s. 2002. Retrieved from http://benjerry.custhelp.com. on 18th April, 2011. 3. Dibb, Sally, Lyndon Simkin, Bill Pride and OC Ferrel. Marketing concepts and strategies. Fifth European edition. Boston: Houghton Mifflin Company. 2006. P.46-47, 662 4. Gilbert, Sarah. Haagen-Dazs vs. Ben & Jerry’s: Battle of the Brands.2007. Retrieved from http://www.bloggingstocks.com/2007/04/13/haagen-dazs-vs-ben-and-jerrys-battle-of-the-brands/ on 18th April, 2011. 5. MillwardBrown. 2009. Brand value: When less is not more. Retrieved from http://www.millwardbrown.com/global/blog/Post/2009-03-15/Brand-value-When-less-is-not-more.aspx on 18th April, 2011. 6. Brandweek Wallace. Consumer Reports has the Scoop on the Best Ice Cream, Consumers Union of U.S.2002. 7. Raphel, Murray. What's the scoop on Ben & Jerry. 1994. Retrieved from http://www.allbusiness.com/marketing/direct-marketing/454093-1.html on 18th April, 2011. 8. Barna, Ed "Ben & Jerry's copes with a changing marketplace". Vermont Business Magazine. 1995. Retrieved from fhttp://findarticles.com/p/articles/mi_qa3675/is_199505/ai_n8722228/ on 18th April, 2011. 9. Ctterill, Ronald W. and Haller, Lawrence E. Market Strategies in Branded Dairy Product Markets. Retrieved from http://ageconsearch.umn.edu/bitstream/25149/1/rr940023.pdf on 18th April, 2011. 10. MarketingWeek. Ben & Jerry’: innovative ice-cream, questionable marketing strategy. 2010. Retrieved from http://www.marketingweek.co.uk/sectors/food-and-drink/food/ben-and-jerry%E2%80%99-innovative-ice-cream-questionable-marketing-strategy/3016805.article on 18th April, 2011. Read More