Analysis of Marketing Strategies of Cowgirl Chocolates - Book Report/Review Example

Case Analysis of Cowgirl Chocolates Table of Contents Table of Contents 1 Situation Analysis: 4 Environment 4 Economic conditions 4 Cultural and social values and trend 4 Industry 5 Classification and definition of industry 5 Analysis of existing competitors 5 Analysis of potential new entrants 5 Analysis of suppliers and buyers 6 Summary of industry opportunities and threat 6 Organization 6 Objectives and constraints 7 Financial condition 7 Marketing Strategy 7 Objective and constraints 7 Analysis of sales, profits, and market share 8 Analysis of target markets ad market mix variables 8 Summary of market strategy strengths and weakness (SWOT) 8 Problem found and situation Analysis 9 Statement of primary problem 9 Statement of secondary problems 9 Strategic Alternatives for solving the problems 10 A.Solution of primary problem 10 Benefits 10 Costs 10 B.Solution of secondary problem 11 Benefits 11 Costs 11 Selection of Strategic Alternative and Implementation 12 Statement of selected strategic 12 Justification for selection of strategy 12 Description of implementation of strategy 12 References 13 Situation Analysis: Environment Chocolate is also referred to as a comfort food. Also chocolate is considered as an expression of love. In the present day’s society chocolate is also known as a woman’s ‘sweet dream’. Now in the context of the company Cowgirl chocolates generally manufacture spicy chocolates which are very much a rare. In general spicy chocolates are hardly available in the market. When the company started to market this product, they could not cater to their desired area or market. The taste of the product is best suited to the group of people which like spices and a flavor of European chocolates. Economic conditions Economic condition refers to the present financial condition of the company. The present financial condition is stable. Hence people can spend in such items. Cultural and social values and trend There are actually no issues in context with chocolate products. It is an accepted product of the society. Industry Classification and definition of industry The chocolate industry is very much vast. However the market for spicy chocolate is not as large as compared to the market of chocolates. Gift packaging is well admired during the holidays. The company has also succeeded to position itself in that way. Analysis of existing competitors There are very less direct competitors for the company. Most of the companies are indirect competitors. The company mainly competes with the other companies on the basis of shelf booking of the retailers. They want their product to position at such a place, so that it gets easily noticeable. The main competitor of the company is Seattle chocolate. Seattle chocolates have some of the high quality chocolates but without spices. Other companies manufacture some of the premium chocolates and some variants of it. Apart from competing with the established chocolate companies, the company also competes with the players which belong to the hot and spicy food industry. However these products are not made up of sweet. Therefore they can be referred to as the substitute products. Analysis of potential new entrants Chocolates are favorite among a mass section. Also given the favorable conditions has increased the threat of new entrants. Analysis of suppliers and buyers The suppliers of such products are in huge numbers. Also these days’ raw materials are available online. Hence bargaining power of suppliers is low. The industry also has a number of established layers; therefore the consumers get a number of options. Hence bargaining power of buyers is high. Summary of industry opportunities and threat The industry offers a number of opportunities. The most important opportunity lies in its distribution. The companies can target other established restaurants and can also consider exclusive store operation. However threats are also there from substitute products. Beverage sector and fast food sector are the biggest threats of the industry. Organization Cowgirl chocolate is a chocolate manufacturing and marketing company. It was established in the year1997. Head Cowgirl Marilyn Lysohir is the founder of this company. The owner was from a small town in Idaho and used to have huge optimism for Cowgirl Chocolates (Cowgirl Chocolates, “About Us”). However she had to face many difficulties while accomplishing the objective. Objectives and constraints The principal objective of the company is to turn this into a profitable venture. The products of the company is highly praised and even won awards, but finding difficulties to achieve the intended profit. Financial condition The company has been able to achieve some financial stabilization in the recent past. However in the initial stages it has noticed some of the biggest economic downturns. Marketing Strategy The marketing strategy of any company is the key factor towards its success. Every organization spends high amount of money in implementing the marketing strategies. Companies highly depend upon the marketing strategies. However the success also depends upon how the strategies are actually executed. The most essential elements of a marketing mix are product, price, place and promotion. Objective and constraints The marketing objective of the company is to position its product as ‘something different’. Also through marketing strategies the company wants to revive its financial condition. Through spicy chocolate the company could also achieve product differentiation. However there are high financial constraints. Analysis of sales, profits, and market share Cowgirl chocolates offer a range of products which includes chocolate bars, wrapped truffles and hot caramel desert sauce (Cowgirl Chocolates, “Flavor Guide”). The ¼ pounds muslin bug is one of the most popular truffle products of the company. Alone this product makes up around 16% of the total revenue. While the ½ pound of the same product makes up 12% of the total revenue of the company. On an overall basis truffles makes up 40% of the total revenue. The company markets the spicy chocolates individually and that accounts at around 50% of the entire revenue of the company. The hot caramel desert sauce is marketed through the use of jars and nearly accounts at around 10 percent of the total revenue. The company pricing is done in such a way so that it can target multiple group of customers. The company intends to achieve a profit margin of 65 per cent leaving packaging and ingredients. Analysis of target markets ad market mix variables The company needs to target both males and females. Apart from this they can target their market on the basis of geographic locations. The marketing mix variables or 4p’s also needs attention. For example price flexibility and targeting gift shops will help in increasing the sales. Summary of market strategy strengths and weakness (SWOT) The strengths of the company are:- Product uniqueness. Word of mouth promotion. Weakness Relatively new player in the market Financial constraints. Problem found and situation Analysis Statement of primary problem The primary problem of the company can be stated as how it can increase the profitability. Statement of secondary problems The secondary problem is about how Cowgirl chocolates can appeal to both males and females. Strategic Alternatives for solving the problems A. Solution of primary problem The company needs to invest in the promotions of the product. It needs to demonstrate the uniqueness of the product. This will appeal to a mass and can certainly earn more revenues in the long term. Benefits It will help the company in the long term. With the effect of high end promotion the company can then reach a mass section. As the customer base increases the company can expand itself geographically which will allow them to have a larger base of loyal customers. Thus one a whole it will help the company to earn more revenue in the long term. Costs The cost that needs to be incurred is on the higher side. However the Return on Investment (ROI) will be higher. The promotional media will be an important factor for deciding the cost to be incurred. Promotion via television will generally cost more as it visually broadcasted, while on the other hand if print media is used it will cost lower as compared to the other forms. However apart from this modern and cost effective technique of promotion will help in reducing the cost of promotion. Modern methods such as promotion via social media will help the company and also it has mass reach. B. Solution of secondary problem Ingredients need to be modified so as taste for appealing to a larger section of the market. Both males and females can then be targeted. The company needs to develop their marketing mix in such a way that it could portray a bigger presence in the market. Benefits The company can earn more revenue as the sales volume will automatically jump up. The company can also cater to a large base of customers. Also it will help in the process of word of mouth promotion on which the company depends highly. Also proper segmentation will help to decide upon the product strategy. Costs There is a need of certain amount of investment, but not as like promoting the products. Investments mainly need to be made in the field of research and development. Also production cost may get increased on the addition of new flavors. Selection of Strategic Alternative and Implementation Statement of selected strategic The strategy that has been selected to turn the company into a profitable venture is adopting the second alternative i.e. to target larger group of consumers by modifying the taste. Justification for selection of strategy The cost that needs to be incurred is less as compared to the other. The company is also in a financial stagnation. Hence this strategy is appropriate for the course of action. Description of implementation of strategy A thorough market research needs to be carried out before selecting the flavors. As the process of survey gets over the final outcome can be analyzed and accordingly new flavors can be incorporated in the product mix of the company. References Cowgirl Chocolates. “About Us.” Cowgirl Chocolates. Cowgirl Chocolates, 2009. Web. 04 July 2012. Cowgirl Chocolates. “Flavor Guide.” Cowgirl Chocolates. Cowgirl Chocolates, 2009. Web. 04 July 2012. Read More