Haagen-Dazs Ice-Cream - Report Example

College: PART A. Marketing Mix According to Grewal and Levy (7), marketing is conventionally divided into four interconnected decisions and resultant actions referred to as a marketing mix. Also popularly known as four Ps, this set of decisions covers fundamental elements of marketing including product, price, promotion, and place. These marketing constituents make up an adjustable set of activities that a firm exploits in response to the needs of potential target markets. Haagen-Dazs is one such firm that has used its marketing mix to sustain its leading position as a premium ice cream manufacturer in the global market. Haagen-Dazs was a pioneer in the ice-cream production industry, seeking to create unique and indulgent brands for adults. Although highly priced, Haagen-Dazs’ wide array of ice-cream brands swiftly garnered loyal customers. Many individuals in the contemporary society associate the company’s logo with exceptional quality premium ice-cream. Haagen-Dazs has not, however, attained this significant feat easily. Haagen-Dazs has achieved leadership in the premium ice cream and sorbet industry by utilizing a comprehensive marketing mix and competitive strategy, which this paper analyzes in detail. Product A product refers to anything offered to markets for use or consumption, in order to satisfy a need or want (Grewal and Levy 8). Haagen-Dazs’ products primarily comprise of a wide range of luxury ice-creams. The company has also diversified into production of frozen yogurt, frozen dessert/sorbet, and bars. These products are made from premium ingredients like vanilla sourced from Madagascar, Hawaii nuts, and Belgian chocolate, among others. The flavors of Haagen-Dazs ice cream are as diverse, as their constituent ingredients. For example, there are currently more than thirty classic ice cream flavors and more than two limited version flavors. The broad assortment of flavors presents consumers with the chance to make a distinctive choice and explore their taste palette. The premium ice cream giant also makes significant efforts to ensure that flavors are in line with specific target markets. This strategy fosters product adaptation to various markets, including specific market groups and nations. Haagen-Dazs’ product adaptation undertaking is evident from the country’s flexibility in accounting for diverse demands and flavors in various countries. For example, the company introduced ‘green tea’ flavored ice cream in Japan, given the Japanese love for green tea. There is also ‘cheesecake’ ice cream in the United Kingdom market, as well as, ‘Belgian chocolate’ ice-cream targeting the chocolate loving consumers in Eastern Europe (Chakraborty and Govind 3). In addition to the distinctive product taste, variety, and high quality, another product attribute that attracts customers is the premium packaging characterized by unique designs. The wrappings and packaging materials used by Haagen-Dazs further perpetuate the luxurious nature of the company’s products. The ultra-premium nature of packaging is evident from its higher density, in comparison to conventional wrappings and containers, as well as, distinctive colors often associated with opulence. Haagen-Dazs’ containers and wrappings bear the company’s corporate colors, that is, gold, white, black and burgundy. There is also an engraved corporate logo in every packaging as a picture beneath the logo describing the ice cream, sorbet or bar flavor. The unique and high quality packaging accentuates Haagen-Dazs’ fundamental values of uniqueness, luxury, and exceptional quality (Chakraborty and Govind 3-4). The alluring nature of product packaging lures targeted customers, since it expressly shows that one is purchasing a premium commodity. Place Grewal and Levy (10) denotes that place or placement comprises of distribution strategies and market locations deemed most appropriate by a firm for its products. Strategic placement or selection of the most appropriate place requires involvement not just of the manufacturer, but also of retailers and other intermediaries, who work in unison to avail products to the final consumers. In Haagen-Dazs’ case, products are shipped using refrigerated trucks, from manufacturing plants to retailers like high-class ice-cream outlets, exclusive cinemas, first class hotels and restaurants, prominent fast food chains like Pizza Hut, cruise ships, and most importantly, Haagen-Dazs franchise outlets. These exclusive locations allow targeted customers, that is, well-off adults to access the products with ease. Prior to approving franchise outlets, prospective franchisees must prove to Haagen-Dazs that they have sufficient financial resources and potentially lucrative locations in which to launch their shops. As a result, most Haagen-Dazs ice cream shops are located in strategic spots that are characterized by high traffic of well-off individuals capable of purchasing the company’s signature products. These strategic spots include renowned city streets frequented by local shoppers and tourists, high-end shopping malls, prominent learning institutions, and shops close to major route intersections. It is also imperative to note that majority of Haagen-Dazs franchises offer regular customers an opportunity to become club members, thus enjoying accompanying benefits. Such placement advantages include getting free samples of limited version flavors, free entry into events sponsored by Haagen-Dazs, and involvement in celebrating company accomplishments (Chakraborty and Govind 7). These distribution strategies, therefore, double as promotional measures and they go a long way towards reinforcing customer loyalty. Price Price refers to the sum of money that a customer pays, in order to get a product in exchange. Price is an instrumental tool in determining whether consumers would be willing to purchase the availed products (Grewal and Levy 10). Haagen-Dazs is a premium brand manufacturing company. This implies that the price of its commodities reflects their luxurious nature. The price varies on the basis of the flavor, packaged amount, and even country of availability, but it is overall premium, ranging from a minimum of $3.7 to as high as $10. A significant pricing issue that has affected the company in the recent past was allotting a price deemed fair for its low-fat products. Given the fact that there were already players in the low-fat market, customers could not comprehend why Haagen-Dazs’ products were not equally cheap, but adopted the $3.7 to $10 price range applicable to the company’s regular premium ice cream. Eventually, Haagen-Dazs had to launch a promotional campaign, demonstrating why its low-fat products bore the high price. The ad clearly showed that there are greater processing concerns, in which the company strives to maintain the rich product flavor while reducing the level of fat. Haagen-Dazs’ pricing strategy, therefore, adequately accounts for the product quality and not just competing market prices. Promotion Promotion encompasses various advertising methods and activities used by a firm to inform customers about its products, as well as, how and where to access them. Marketing communication is vital, since without it, it would be virtually impossible to reach target markets (Grewal and Levy 11). Haagen-Dazs primarily makes use of printed themes in food magazines and newspapers, coupled with television adverts. The company also utilizes occasional special price coupons and discounts, in addition to positive word of mouth, to lure additional customers. Another element of the company’s promotional strategy is its significant effort to link its brand image and name to popular events. For instance, Haagen-Dazs has sponsored high-profile sporting events in the past. The latter include the French Open and Wimbledon, which are renowned tennis events that attract affluent potential customers. The company has also supported other notable events like the National Opera in Britain and Paris, as well as, high-status horse races (Chakraborty and Govind 5). B. Competitive Analysis Competitors play a significant role in motivating a firm to map out comprehensive operation and marketing strategies capable of enabling it to maintain competitive advantage. In addition, industry rivals prompt a company to transform its products, prices, promotional strategies and target markets based on evolving societal trends (Grewal and Levy 31). Haagen-Dazs is not exempt from competition in the premium ice-cream and sorbet industry. Key among the company’s industry rivals is Ben & Jerrys, which just like Haagen-Dazs, dominates an estimated 42% of the premium sorbet and ice cream market. Since its inception in 1978, Ben & Jerry’s offers super-premium an assorted array of sorbet, frozen yogurt and ice cream, just like Haagen-Dazs. However, the company also strives to operate in a manner that improves customers’ life quality. For instance, through its charity foundation, the company finances community-oriented projects thus taking a stand on social concerns, which serves as a unique promotional strategy. Other than commitment to exceptional quality, Ben & Jerry’s company also poses significant industry rivalry to Haagen-Dazs through its commitment to environmental standards, ingredient selection, and packaging materials and methods. Another upcoming competitor to Haagen-Dazs is London Dairy, an ice-cream and sorbet producer that positions itself as a premium brand. Despite premium prices comparable to Haagen-Dazs’, London Dairy is accessible in more locations, since products are available in virtually every gas station and other retail areas like convenience stores. This has prompted Haagen-Dazs to adopt a similar placement approach; hence availing its products in a broader range of supermarkets and petrol stations. Nestle can also not be overlooked as a significant rival to Haagen-Dazs, especially since its integration into the premium ice-cream industry. Nestle is not only one of the world’s biggest ice-cream companies, but it also adheres to industry traditions. Further, Nestle always strives to develop new and fairly priced products to meet customer preference and needs. By embracing an innovative and customer-oriented culture, coupled with low prices compared to premium ice cream manufacturers, the company is a force Haagen-Dazs has to reckon with. It is imperative to note that competition is heightened by use of high-tech and unique packaging, as well as, a virtually similar price range. The only disparity stems from promotional intensity, where Haagen-Dazs reaches out to a broader customer base, and promotional offers such as occasional discounts and coupons. Overall, Haagen-Dazs gains its competitive advantage from a combination of various factors including proficient ingredient selection and strategic market positioning. The company has also managed to maintain high market visibility through unique placement and promotional approaches. Work Cited Chakraborty, Ishani and Govind, Sachin. Haagen-Dazs: Repositioning a Cult Brand. 2006. Web. 13 October 2014. Grewal, Dhruv and Levy, Michael. Marketing. (4th ed.). New York, NY: McGraw-Hill/Irwin. 2014. Print. Read More