Marketing Strategy - Stark Chocolate Cafe in Canberra - Case Study Example

Name Instructor Course Date Marketing Strategy: Stark Chocolate Café, Canberra Product Product is a key marketing mix element that Stark Chocolate Café will have to consider in its marketing strategy to ensure success and competitiveness in the Australian chocolate industry. First, Ekanem notes that quality is one of the key elements of a product that customers consider when making their buying decision (11). Customers are driven to products that are of quality when making their purchasing decision. As such, to succeed in the Australian chocolate market, Stark Chocolate Café will have to ensure that the chocolate bars are of high quality. Second, variety is another aspect of chocolate that customers look for when choosing the chocolate café to eat chocolate. Because the testes of chocolate eaters differ from one person to another (Rogers 9), Stark Chocolate Café will ensure that it provides customers with different types of chocolates with different flavors that comes in different sizes that suits the pocket of every customer. Additionally, because some customers prefer eating chocolates with accompaniments, Stark Chocolate will have to consider providing other accompaniments, such as drinks and smoothies that customers can enjoy as they take their chocolate. Providing drinks and smoothies alongside chocolates as the main product will help Stark Chocolate attract not only chocolate eaters, but also those interested in drinks and smoothies. Moreover, Stark Chocolate will have to ensure that the chocolates are served in a serine and comfortable café. To achieve this, the company will have to ensure that the café is beautifully painted and equipped with good tables and chairs as these elements also add value to customers that visit the café for chocolate. Further, to attract customers to the café, Stark Chocolate will have to consider providing entertainment and free internet connection at the café as this would enable the café to attract young customers and professionals who may want to get entertained or enjoy internet services as they enjoy chocolate. Price Price is a fundamental element of the marketing mix that Stark Chocolate will have to consider when launching its chocolate café in Canberra. Ekanem argues that price is a critical factor that customers consider when making pricing decisions (16). Price is particularly a major factor for products whose price elasticity is high, such as chocolate. This implies that, to attract a large number of customers, prices charged must be affordable and reasonable. Considering the nature of the Australian chocolate market, Stark Chocolate should consider adopting premium pricing strategy for its chocolate during the launch. Premium pricing is a pricing strategy that involves charging high prices for a product during new product launch. Charging premium pricing strategy will be important for Stark Chocolate when launching its chocolate café in Canberra as it will make customers perceive the chocolate bars served by Stark Chocolate as being of high quality. Although charging premium prices will make the company loose low income segment of the market, the benefits that would be derived from such pricing strategy would be huge in the long term as noted by Rogers (17). However, once the café has charged premium prices during the launch, Stark Chocolate will follow the premium pricing by lowering the prices to make them affordable even for the price sensitive customers that make up a huge part of the market. In this respect, Stark Chocolate will have to charge prices that are slightly lower than those charged by major competitors, such as Max Brenner, Chocolateria San Churro, and Oliver Brown. Charging prices that are slightly lower than what these major competitors charge will enable Stark Chocolate to gain a competitive edge by attracting price conscious chocolate consumers in Canberra. Additionally, the pricing should also involve providing customers discounts, especially for those customers that buy chocolate in large quantity. Place/Distribution Place is a marketing mix element that denotes how the products are made available to customers. In other words, place indicates how products or services are distributed to customers. Feltenstein argues that to succeed in a market, a company must ensure that the products or services provided by a company are made easily accessible to customers (52). This implies that customers need not to struggle, such as traveling long distances to get the product since this would make the customer to switch to those products of the competitor firm that can be accessed easily. Therefore, in order for Stark Chocolate Café to succeed in the Australian chocolate market, the company will have to ensure that the chocolates are easily accessible to customers. The first strategy that the café intends to use is to set up a café in Canberra city. This is a right strategic move considering that the city has millions of chocolate lovers. As such, setting a chocolate café in the city will make it easy for the Canberra city residents to have easy access to the chocolates. However, Stark Chocolate will have to ensure that the café is located at strategic positions for easy accessibility. Besides, considering the Canberra city is large, Stark Chocolate will have to ensure that it opens up many chocolate café along different streets in Canberra to ensure ease of accessibility by chocolate lovers in the city. Second, Stark Chocolate should consider distributing its chocolates through major supermarkets and groceries in Australia. For instance, Stark Chocolate will have to consider distributing its chocolates through well-established supermarkets and groceries, such as Woolworth and Cole. These supermarkets have presence in all major cities and towns throughout Australia. Therefore, using them as distribution points will enable Stark Chocolate customers have easy access to the company’s chocolates. Besides, Stark Chocolate will benefit from this mode of distribution considering that these supermarkets and grocers are frequented by most Australians. Additionally, Stark Chocolate should consider introducing online shopping experience to make its chocolates easily accessible to its targeted customers. A 2013 study by Roy Morgan found that about 50% of Australians shop online (Bainbridge par. 7). This implies that there is an increasing shift from shopping from physical stores to online shopping in Australians. The growth in this shopping trend has been sparked by proliferation of internet accessibility coupled with increased availability of smartphone devices. Therefore, Stark Chocolate should consider introducing online shopping to allow customers to do their shopping at the comfort of their homes. Introducing online shopping will be of immense benefits to Stark Chocolate considering that online shopping will not just restrict the company to the Canberra or Australian chocolate consumers, but also extent its market reach beyond boundaries. Promotional Promotion is a critical marketing mix component that denotes how a company makes its products known to the targeted audience and how they are persuaded to buy a product. According to Feltenstein, just developing quality products and services and charging affordable prices are not enough to win a market (41). Instead, Feltenstein suggest that, once a company has developed products or services, the company must ensure that awareness about the existence of the products is created and that customers are persuaded using suitable communication channels to buy the firm products or services (41). As such, in order for Stark Chocolate to succeed in the Australian chocolate market, it will have to consider adopting integrated marketing communication (IMC) tools to promote its products. The communication tools include media advertising, sales promotion, product giveaways, sponsorships, and billboards. Media Advertising Social Media Social media is the first media advertising tool that Stark Chocolate will have to consider adopting in promoting its chocolate business venture. This is because social media has emerged as a powerful tool that companies use today to promote their products. The use of social media as a marketing tool will be of great benefit to Stark Chocolate considering that it will enable the company to reach out to a wide audience cheaply. According to a recent social media usage study, it was discovered that about 65% of Aussies use social media with up to 45% using social media at least once per day (fig. 1) (Cowling par. 6). The study also found that at least 15 million Australians have Facebook account while about 3 million are Twitter users and about 13 million are YouTube users (Cowling par. 8). Therefore, Stark Chocolate should consider using social media sites, such as Facebook, Twitter, Instagram, YouTube, WhatsApp, Google and LinkedIn to reach out to its targeted audience and to promote its chocolate products. Source: Yellow TM Social Media Report (2013) Television Advertising Television advertising has been used for many years now to create product awareness. Despite the high cost associated with advertising a product on television, television still acts as a useful communication tool for promoting a product. Therefore, Stark Chocolate will have to consider advertising its newly launched chocolate business. The advantage of using television ad is the majority of Australians still rely on television as their main source of information. According to ACMA 2012 report, there are approximately 18.7 million working TV sets in Australian households, which accounts for an average of 2.2 TV sets per household (ACMA par. 1). This implies that the majority of Australians watch television on a daily basis. As such, Stark Chocolate should consider taking advantage of this by advertising its chocolates through the major television channels in Australia, such as the Australian Broadcasting Corporation, 7News, Sky News Australia and INTV Australia. Website To reach a wide audience, Stark Chocolate should consider creating a good and user-friendly website for promoting its chocolate products. In the modern day society, most people get information through the internet. For instance, Bainbridge 2013 study found that more than 60% of Australians use the internet more than once a day (Bainbridge par. 11). This implies that advertising the chocolates on the company website will enable Stark Chocolate firm reach out to a wide audience. The website will also give the company the opportunity to place the pictures of the chocolate varieties that customers might want to buy. Product Giveaways Because Stark Chocolate is just introducing its chocolate in Canberra for the first time, it will be necessary for the company to use giveaways as a strategy for promoting its chocolates. Giveaways will involve giving people samples of the chocolate varieties that the company intends to introduce. By trying the new chocolates, the customers will be enticed to buy the product, thereby resulting in high sales as noted by Jayachandran (69). Sponsorships Sponsorship is another promotional strategy that will be appropriate for use in promoting the chocolates to be introduced by Stark Chocolate in Canberra. In this respect, Stark Chocolate will have to consider sponsoring sports and cultural events in Australia. The sport events that it will consider sponsoring include Formula 1, Australian Premier League, and Cricket and school games. SAXENA argues that because these events are attended or watched my millions of people, they will give Stark Chocolate a chance to showcase their newly launched chocolate flavors (106). Billboards Billboards will also be a suitable tool for promoting the chocolates. In this respect, Stark Chocolate will ensure that the billboards with the chocolate bars are erected along the major roads at strategic positions in Canberra. Advertising the chocolates using billboards is not just a cheap method of advertising, but also ensures that all road users in Canberra get to know about the existence of the new chocolate flavor in the city and how to get the product. Implementation Budget In order to implement the above marketing plan, a budget has been made that caters for the projected requirements. According to estimates, the marketing plan will require about AU$185,000 as highlighted in the table below. Items Cost (AU$) Building 50,000 Equipment & Facilities 30,000 Advertising 40,000 Materials, such as cocoa 60,000 Insurance 5,000 Total AU$185,000 Promotional Schedule Tactic Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Website Social Media TV Giveaways Billboards Sponsorship Evaluation To ensure that the marketing strategies achieve their objectives, Stark Chocolate will evaluate the strategies to see how they are being received by the targeted audience. The effectiveness of the strategies will be evaluated by getting the feedback of the customers, as well as monitoring and comparing them with those of the competitors. Based on the information gathered, the company will make improvements where necessary to ensure that customer needs are met. Conclusion The Australian chocolate market is huge and provides a lucrative business opportunity for Stark Chocolate. The country has been experiencing significant increase in chocolate eating habits among Aussies. However, for Stark Chocolate to succeed in this market, it must adopt an effective marketing strategies that include developing quality chocolates, adopting effective pricing, distribution and promotional strategies as detailed in the marketing plan. Works Cited ACMA. TV Sets In Australian Households. Web. 25 August 2016 http://acma.gov.au/theACMA/Library/researchacma/Snapshots-and-presentations/tv-sets-in-australian-households-research-library-landing-page Bainbridge, Amy. More Than 50 Per Cent of Australians Shopping Online: Roy Morgan Research. Web. 25 August 2016 http://www.abc.net.au/news/2013-06-04/more-than-50-per-cent-of-australians-shopping-online/4731590 Cowling, David. Social Media Statistics Australia – May 2016. Web. 25 August 2016 http://www.socialmedianews.com.au/social-media-statistics-australia-may-2016/ Ekanem, Anthony. Marketing Tactics That Sell: Some Dirty Tricks. New York, NY: Lulu Press, Inc, 2016. Print. Feltenstein, Tom. 501 Killer Marketing Tactics to Increase Sales Maximize Profits, and Stomp Your Competition: Revised and Expanded Second Edition. London: McGraw Hill Professional, 2010. Print. Jayachandran, S. Marketing Management. Sidney: Excel Books India, 2004. Print. Rogers, Stuart C. Marketing Strategies, Tactics, and Techniques: A Handbook for Practitioners. Oxford: Greenwood Publishing Group, 2001. SAXENA. Marketing Management 4E. Cambridge: Tata McGraw-Hill Education, 2009. Print. Read More