Consumer Behavior and The Second Yogurt War - Assignment Example

Running Head: Analysis of Consumer Behaviour Your name Course name Professors’ name Date Task 1 Product: The product is Delamere Frozen Yogurt. First, yogurt is produced after subjecting milk into fermentation process by the use of probiotic cultures. The resultant of fermentation is lactic acid, which then acts on milk protein to give s smooth texture. During preparation of the yogurt, milk is first heated to 175F then cooled to 112F. Thereafter, bacterial cultures are added and maintained at low temperatures for about seven hours. This product can be mixed with natural fruits as toppings. It is important to note that yogurt have the ability to meet nutritional requirements of both young and old people. The product is not only sufficient with vitamin B12 and B6 but is also rich in protein, calcium, and riboflavin. Moreover, bacterial cultures curbs diarrhoea related illness hence highly recommended. This product is available in 350 and 125 g packs. Target market: Yogurt market in the United States is growing very fast and it is supported by the fact that people are resorting to healthy eating while working or moving. At the same time, nutritionists have been in the frontline advising people against taking fast foods during their meals. In a research by Best (2011), statistics done by the Euromonitor indicates that each person in US consumed GBP 13.90 of yogurt in 2010. However, this rate was lower as compared to Europe, which recorded a higher GBP per person (Jones, 2010). The reason behind this is that Americans were accustomed to breakfast cereals that are considered sweet and are heavily advertised on TV. The other reason behind this high usage of breakfast cereals is the marketing that deploys colourful shapes, sweet fruity and chocolate flavours in addition to attractive packaging. Whilst Americans are in love with sweet flavours, the tart yogurt flavour has contributed to GBP 13.90 per capita consumption. Nonetheless, this has recently changed with an increase in sales by about 9% in 2010 and a market worth of US$6.5bn up from $4.56 in the past 5 years (Best). This change is motivated by a tendency towards healthy food. Pretested profile of consumers: Consumers of yogurt are mainly in all cities and towns in the United States. Those who are travelling and the working category, often consume this product. Primary school and college students who attend classes throughout the day are also targeted customers. In terms of age, women aged between 18 and 34 for the target for YOYO yogurt business. This primary category is usually accompanied by their children and earns an income of approximately $40,000 p.a. The secondary category is single men and women aged 12-34 whose income is low and always look for a place to enjoy a chilled yogurt. Based on income levels, three classes have been identified. The three classes are the upper, middle, and lower class earning an income of over $100000, $50,000-75,000, and 0-25,000 respectively. 35% of the target customers are married, 45% single, and 20% are other groups. In terms of psychographics, customers are classified into two groups. The first one is a group attracted by sweet desert while relaxing. Some people enjoy taking the product as opposed to any other drink when they are just relaxing. In addition, this group will value sitting with friends or family members and enjoy the frozen yogurt. Mobile yogurt and outlets at specific location will serve well this group. The second psychographic group are people who are conscious of what they eat. In relation to this, U.S. has been in the forefront encouraging consumers to be sensitive of what they eat. There is a possibility that the second group would reject fattening snacks and go for frozen yogurt given its nutritional value. Diabetic, women, and people working on their weights are usually advised to consume yogurt owing to its richness of taste and nutrients. Marketing strategy for this second group will concentrate on healthy aspects of frozen yogurt such that it becomes easy for consumer to differentiate ice cream from frozen yogurt. Yogurt market share: According to PRWEB (2012), revenue recorded in 2012 from frozen yogurt reached $1.6 bn and it has been increasing following popularity of frozen yogurt. This product is the fifth largest within the segment of coffee and snack shops and makes up 6% or $1.59 bn of revenue realised from the sector (PRWEB). Within this sector of coffee and snack shops, coffee shops take the largest share. Industry revenue realised from coffee shops is tending upwards due to high popularity of leading chains such as Starbucks. Alignment between chilled yogurt and customer profile is mainly on dietary matters. People in the present society are very cautious with the food they eat. Yogurt comes in handy to provide essential nutrients both for elderly and young people. The outcome of the above measures will be noticeable in: a. Increased market share b. Rising sales c. More customer satisfaction and repeat business d. High consumption of yogurt e. Healthy population f. High profits and returns for the establishment g. Increase in number of outlets Part 2 Validated consumer behaviour: There is no doubt that the present consumer is educated and well informed on health matters. Consumers are very keen when looking at product description. Any new product must win consumer trust or else it risks failure. Marketing of yogurt will therefore revolve around health benefits, convenience, packaging, and affordability. Convenience applies to people who are busy at work and may not find time to go for a full meal. Instead, the person will favour a take-away such as yogurt. The major buying trend influencing purchase of frozen yogurt is health. In 1980s people were very sensitive to the food they ate (Maze, 2009). This trend is slowly returning with emphasis placed on low fats, pro-biotic qualities, and healthy natural toping such as fruits and cereals. It is important to note emergence of innovative flavours including green tea. This observation is affirmed by increased popularity of Portland-based Yocream. Yogurt not only curbs appetite but also is beneficial to the body given that vitamin B12 and B6 in addition to riboflavin, calcium, protein, and active cultures are obtained from consuming the product. Existence of culture means that people who are unable to digest milk can easily digest yogurt thus aid digestion and breakdown of lactose. In Europe, yogurt is used as a tool to lose weight. Women also take the product to gain calcium. One of the previous marketing activities concentrated on flavourful experiences in the use of toppings. The act of posting recipes for building yogurt on the wall above the cup had the effect of promoting addition of toppings before adding yogurt. Secondly is designing a website to allow consumers vote and create favourite recipes. This increased repeat number of customers and sales levels. Thirdly is allocation of large serving spoons within the toppings section. The impact of this move was increased consumption of toppings. Fourth strategy was the use of portable yogurt machines at entertainment centres such as sports season in schools and colleges. This promoted sales and helped build repeat business. Customers are the key priority of yogurt business. This establishment ensures that customers receive the best treatment. While other companies operate on cost reduction and work towards margins and profits, YOYO yogurt centre focus on total customer satisfaction. Apparently, customers are allowed to create their own experiences when in the shop. This means that a customer decides on the variety and number of toppings they want and the capacity of yogurt purchased. Notwithstanding the fact that there are several yogurt shops in the market, YOYO establishment is identifiable from any other business by its highly skilled workforce and quality services. The business further has wide selection of toppings and flavours. This close contact with the customers allows the business to respond immediately to any market or consumer changes. A statement that identifies ethical standard applicable in the organization is establishment of rapport with customers. It is also the intention of the business to be accountable to the customer such that any complaints from the customer are handled professionally and satisfactorily. In relation to legal standards, the business seeks to practise the business with environmental sustainability upheld. Task 3 The number of yogurt outlets has increased considerably over the years and this calls for a focused marketing strategy. A recommendation for a focused strategy in marketing yogurt in U.S. is to distribute the product in large retailers including Wal-Mart and other leading stores. These places attract high-income earners who are likely to purchase large quantity of yogurt. On the other hand, middle and low-income group will be supplied with the product via YOYO outlets in strategic locations in towns. Usage of mobile yogurt will go a long way in addressing the needs of low and middle-income earners. The second recommendation is entering agreement with US foodservice to sell to restaurants, schools, and hospitals. These three places are critical segments where yogurt customers encounter the product. Reference List Best, Dean. 2011, Category Crunch: The “Emerging Market” of US Yogurt- part 1. just- food.com. 18 May 2011. http://www.just-food.com/analysis/the-emerging-market- of-us-yoghurt-part-1_id115228.aspx. Jones, David., Brad, Dorfman., 2010. Danone: U.S. yogurt consumption to double. reuters.com. Mar 16, 2010. http://www.reuters.com/article/2010/03/16/us-food- summit-danone-idUSTRE62E5LX20100316. Maze, Jonathan, 2009. “The Second Yogurt War”, Franchise Times, June-July 2009. PRWEB. 2012. Frozen Yogurt Still Hot! IBISWorld Introduces New Report on Frozen Yogurt Stores. prweb.com. 15 March, 2012. http://www.prweb.com/releases/2011/10/prweb8866384.htm. Read More