Building Marketing Plan for CookieCraze - Term Paper Example

Building Your Marketing Plan (Cookiecraze) Our Product: CookieCraze is a bakery, providing freshly baked goodies to customers. Company description: CookieCraze creates delicious baked items, with specialization in cookies; the company also offers a wide variety of first-rate brownies, pastries, cakes, breads and other items. The company is a partnership owned by two friends and its first physical location is opening soon. Mission statement: CookieCraze’s mission is to be the premier provider of baked goods to consumers, assuring them of taste, highest quality and trust with every buy. The company is committed to doing so by using the highest quality ingredients, hiring the best staff and maintaining top notch levels of customer care. CookieCraze will forever maintain relationships of mutual trust and integrity with all business partners and communities. Goals: 1. To establish the brand of CookieCraze as the best provider of baked goods. 2. To occupy the position of ultimate ‘cookie maker’ in the area. 3. To establish steady sales and customer base to meet costs and generate earnings. Competitive advantage CookieCraze has over two years of experience as a home-run bakery and thus has topnotch recipes, trained chef and a niche clientele. Furthermore, CookiesCraze utilizes only the best ingredients which are requisitioned through established relationships with suppliers. SWOT analysis Strengths 1. Using the best quality ingredients for creating delicious, healthy and innovative baked goodies. 2. Employing the best staff, esp. in-house chefs, to produce top quality, healthy and innovative products. 3. Location of the store in heavy traffic area provides access to many residential as well as office-going customers. Weaknesses 1. Limited finances will limit marketing activities, especially advertising. 2. Current inability to hire more support staff for service and in the kitchen due to cost constraints. Opportunities 1. Healthier baked goods choices for consumers, especially utilizing fruits, nuts and dairy in baking. 2. Establishing brand name and market presence can allow entry into the restaurant industry and more shops across the state. Threats 1. Existing competition in the market from other bakeries and restaurants. 2. Dependence on imported ingredients for some items on the menu make the business susceptible to risk of fluctuating exchange rates, international relations, etc. Market Trends 1. Social factors According to the US census, there has been a rise in the rate of population growth. This offers an opportunity to the business because it implies that the business is in a market with an increasing number of consumers (Kim & Renee, 2005). The increasing working population is the most important for the business because most of the working people are busy and prefer carrying food to their places of work. Since CookieCraze is involved in creating delicious baked items especially cookies, the company will record a huge success in preparing packed food for its customers. The US has in recent years recorded high numbers in the demand for baked products especially cookies. This provides a perfect opportunity for the company to enter into a growing market and attract a sizeable number of customers. In addition, the US consumers often change their tastes and preferences. This is a threat to the business because of the high costs of making responses. Majority of US consumers believe that baked products have high sugar content also pose a threat to the business mainly because very sweet hence may impart negatively on the operations of the business. This is because our company’s products will be viewed as unhealthy (Daft & Dorothy, 2008). Consequently, this may reduce the demand because cookies are prepared from sugar products. 2. Economic factors In recent times, the US government has liberalized trade in sugar containing products such as cookies. This is a threat to the business because it creates an influx of foreign cheap products hence hindering domestic companies such as CookieCraze to compete even locally (McShane, 2001). The US government has also maintained high prices of confectionaries including cookies through tariff-rate quotas. This is an opportunity for the business to charge high prices for its products. 3. Technological factors The introduction and use of the vending machine has improved business transactions in the US. The machine is used in dispensing various types of products including snacks and confectionaries. This is an opportunity for the business to cut on the cost of business operations by adopting the use of vending machines in selling its products. This will ensure that cookies are made available around the clock with minimal or no supervision. 4. Competitive factors The US market for baked products is very competitive and is dominated by small retail bakeries. This makes it difficult for startups to enter such a market and even attract new customers. However, there are also large retail bakeries including Oreo and Girl Scout Cookie that command a large market share for bakery products. The competitive nature of the market is a threat to CookieCraze because it will reduce its market share (Daft & Dorothy, 2008). 5. Regulatory forces The US has very tough regulatory frameworks for bakery businesses. Some of the tough regulations include high taxes on sugar manufactured products and levels of lead in baked products. This is a threat to the business because it will increase the cost of baked products in the market hence restrict sales for the business. However, CookieCraze will ensure that there is maximum compliance with existing rules and regulations in the market. Consumer Analysis The target market mainly comprises of middle and upper-income earners. This market segment has the largest consumption of bakery products especially cookies. There are two categories of the target market including local residents and tourists. Local residents provide the largest regular customer base for CookieCraze. This will ensure that the company has a steady and consistent source of revenue. Tourists comprise of the lesser group of target consumers and contribute approximately 30% of the total revenues to the business. They represent an unexploited market and CookieCraze will concentrate on capturing this market segment. Marketing Mix Decision Marketing mix decision for CookieCraze includes price, place, promotion and product. a. Price CookieCraze targets to capture a significant market share and therefore, the business will adopt a penetrating price strategy. Cookies will be charged a relatively lower price than competing products. However, after sometime the business will be able to develop a competitive advantage over other businesses and it will introduce a new pricing strategy involving price skimming. Price skimming involves charging a relatively higher price as a result of the existence of a competitive advantage. There will also be seasonal pricing depending on the levels of demand for cookies (Daft & Dorothy, 2008). CookieCraze will increase its prices for cookies when there are high numbers of tourists and maintain relatively low prices when the number of tourists falls. b. Place CookieCraze will establish distribution centers so as to ensure that its products reach a larger market. However, distribution centers will be managed by franchising businesses so as to maintain uniformity and ensure quality for consumers. The product will also be available in supermarkets and refreshment joints. c. Promotion The business will use a combination of advertising and personal selling in its promotion campaigns. Most of the advertisements will be carried out in the television and social media platforms such as facebook and Twitter (McShane, 2001). Personal selling will mainly target tourists through the development of relationships and eventually trying to sell the products. d. Product The cookies will be branded CookieCraze, a name similar to the manufacturing company. They will be packaged in plastic containers that will bear the brand name. The packaging will also contain information on the content of the product and its date of expiry. Market Analysis In 2001, the U.S. Census Bureau recorded that Americans consumed bakery products estimated at $48.5 billion. The census report also recorded that the U.S has recorded an average of 3% increase in the amount of consumption of bakery products. In 2008, the U.S. market for bakery products was estimated at $20.5 billion (Kim & Renee, 2005). The U.S. market for baked products mainly consists of small and independently owned retail bakeries. It is a common feature that the retail bakeries have operations in one or two locations. However, there is also the existence of large retail bakeries such as Tim Horton’s and Panera Bread Company (McShane, 2001). Since 1999, there has been an increase in the number of consolidations among retail bakeries. This is majorly because bakeries have shifted their focus on resource utilization. This has been successful and according to the U.S. Census Bureau, the bakery industry recorded a capacity utilization rate of 72% in the year 2000. This was an improvement from 74% in the previous year. However, increased consolidation has reduced the number of operations from 7,673 to 6,780 in the years 1998 and 1999 respectively. References Daft, R & Dorothy, M. (2008). Management: The New Workplace. 6th ed. South Western, Australia: Cengage Learning. Kim, W & Renee, M. (2005). Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant. Massachusetts: Harvard Business School Press. McShane, S. (2001). Organizational Behavior. Princeton, NJ: McGraw-Hill. Read More