Gloria Jeans Coffees Marketing Plan - Case Study Example

A summary Report Name: Course: Tutor: Institution: Date: Table of Contents Table of Contents 2 1.0 Company Background 3 2.0 Market Overview 3 3.0 Competitor Analysis 4 4.0 Buyer Behaviour 5 5.0 Market Segmentation 6 6.0 Internal Analysis 6 7.0 Product Objectives 8 8.0 Target Market 8 9.0 Marketing Mix Strategies 9 10.0Action and Control Program 10 References 12 1.0 Company Background The Gloria Jean’s Coffees was founded in the late 1979 in Chicago USA. However, since its inception, the coffee store has grown and expanded its market influence both across the USA states as well as in Australia. The coffee outlet is based on an operational mission of developing a family of stores that supply highest quality coffee to the consumers as well as ensuring the provision of highly personalized services to the existing consumers across the organizational stores (“Gloria Jean’s Coffees”, 2014). Under its objectives it intends to increase its positioning among the loyal consumers, maintain growth in the rather highly competitive coffee industry as well as increase purchase frequency of coffee products in a day. 2.0 Market Overview The organizational market category is in the cafes through its opening up the Gloria cafes. In this regard, the served coffee products and offered services are customized based on the market needs. Moreover, the organization targets small consumer base of individuals aged between 18-25 years as contrasted to its competitor starbucks that targets consumes aged between 15-64 years of age. The organizational ventures in the Australian market present it with increased growth potentials due to the rising growth trends that were forecasted at 2.5% annually. Moreover, with the immigrant nature of the Australian market and the growing trends in coffee consumption such as the current average of 14 cups per individual in a week, the venture sales are bound to increase into the future, as the industry is still in its growth stage (Courville, 2003, p.97). The existence of a growing coffee use culture, developing economic situations in Australia as well as stable political institutions supporting both domestic and foreign businesses, the venture success into the future is guaranteed. In this regard, the venture unique market traits such as its strong brand image developed over time, appropriate market positioning and creativity culture are expected to stimulate its growth and improve its overall market competitiveness against the competitors into the future. 3.0 Competitor Analysis The key Australian market competitors for the organization include the Starbucks and 7 eleven companies. On one hand, the starbucks company offers a variety of products such as the globally recognized cocoa Frapucinno and reading and library rooms’ spaces. Among the organizational strengths include its global presence that offers it an increased market reputation as well as the products variety and standardized product offerings. However, the organization has weaknesses in its declining global performance and low liquidity to adapt to change in demand. On the other hand, the 7 eleven company that has its merits and strengths in the offering of cheap coffee and its specialty in offering services for 24 hours a day as well as location of the stores in strategic locations poses a major competition threat. The supply of other products under the organizational roof increases its relative overall demand (McLean, 2004, p.333). However, despite the organizational supply of products such as fast coffee and slurpee, has a challenge in its use of the fast food marketing model and perceived supply of non professional high quality coffee that reducing demand by profiled organisations and individuals in the market. Therefore, based on this review, it is apparent that despite their strengths, both competitors have a share of weakness that offers the Gloria Jean’s coffee cafes an opportunity to expand and establish increasing market influence. 4.0 Buyer Behaviour The coffee industry buying roles can be classified into five broad categories. On one hand Vulkan (2003, p.79) described that it is the initiator role that characterizes the individual who raises the need alarm followed by the influence who is a consumer that motivates the third category decider to make a purchase decision. Such an influencer showcases the benefits and gains of consuming a product to the decider. Moreover, once the decider makes the decision, the information is passed onto the buyer consumer to make the actual buying decision and finally pass on the purchased product to the consumer who serves as the end consumer of the product. Although at times these roles could be integrated into one individual in personal buying, organizational buying has different individuals possessing varied roles as discussed. In the buying process, Azizi and Makkizadeh (2012, p.91) stated that individuals are faced by a chain of decision making stages namely need identification, information search, alternatives evaluation, purchasing and post purchasing stages respectively. Finally, under the coffee industry consumers buying behaviours are the various decisions making types exhibited by the consumers when making their purchasing decisions. In this regard, this report concludes that among the common types include straight re-buys where consumers offer similar products frequently, modified re-buys where they order the same products but each time with requests for slight customizations and the new task buy where consumers buy a product for the first time. It is from the new task buying that either straight or modified re-buys emerge in the subsequent purchases. 5.0 Market Segmentation In order to facilitate its eventual market success, the Gloria Jean’s coffee organisations developed a market segmentation strategy to allow for the focusing and development of unique strategies for diverse and varied segments, In this regard as Hunt and Arnett (2004, p.12) argued, market segmentation can be based on four categories namely geographic, psychographic, behavioural and demographic. On its part, the organization applied the psychographic and behavioural market segmentation approaches to divide and establish its market positioning and influence in the market. This information is summarized in the table below 6.0 Internal Analysis In order to offer a strategic and critical review of the organizational internal analysis, this report applies the recommendations of Brooks, Heffner and Henderson (2014, p.23) that a SWOT analysis is one of the strategic approaches in the market. As such, a strength analysis reveals that the organizational attractive brand logo, interior décor of its coffee outlets, strategic positioning in areas with high traffic and products varieties such as sandwiches and cakes besides coffee offer it increased market success. However, a weakness analysis establishes that the existing coffee industry high operating costs, as well as competition threats from established organisations such as Starbucks pose a major profit margin decline challenge to its operations funding and expansion capability. Nevertheless, an opportunities review showcases that the increasing Australian market consumption of coffee forecasted to increase into the future offers the organization an opportunity to open up increased coffee outlets and subsequently benefit from mass sales as well as use it brand image to diversify its overall products base in the industry (Jolliffe, 2010, p.154). Finally, a threats analysis of the venture concludes that the industry at large is faced by the challenge of increasing health consciousness among the population and thus reducing their overall coffee intake rates in the market into the future. A current marketing strategy establishes that the organization uses low price costing, increased outlets to ensure place coverage, promotion through the media s well as customer service employee base use to increase customer service quality. The table below illustrates the SWOT analysis. 7.0 Product Objectives The Gloria Jean’s Coffees objectives are SMART in that they are specific on what the organization intends to achieve such as provide highest quality coffee products in the market (Frey, 2002, p.234). Moreover, they are measurable in that the objective such as the sales increase that can be quantified and evaluated in financial terms to assess their gains. In addition, the objectives are attainable in that the set objectives are in line with the market trends and practices. Further, the objectives are realistic. For instance the objective to expand into new markets in the Australian market is realistic because the organization has the required human resource and the growing Australian market coffee consumption trends and practices in the market. Finally, the organizational objectives are time bound. For instance, the organizational objective of increasing influence and Australian market spread is based on a realistic timelines that allows for success evaluation once the estimated time lapses. Moreover, the approach allows for the development of consecutive objectives by the venture. 8.0 Target Market The Gloria Jean’s coffees venture has its target consumer segregated on the basis of their consumption of coffee. In this case, it currently targets the consumers who are coffee drinkers in the Australian market. In particular, the consumer target market is one that has its age between 16-25 years. This is the most productive and vibrant age bracket in the Australian market likely to consumer coffee as a stimulant beverage. Under the market positioning approach, the product will be relatively cheap and of high quality due to the use of fruits such as pineapples. Moreover, besides the organizational competitors as discussed above, the product will face competition from others such as the straw berry cake, all berry cake and the chocolate cake among others in the market. Below is the target market perpetual map highlighting the position of the proposed new product against the other existing market products. 9.0 Marketing Mix Strategies Under the marketing mix strategies analysis, this report offers an evaluation of the product, price, place, promotion, physical environment, process and people as the key marketing mix strategies. On one hand, a product evaluation of the proposed pineapple cake reveals that its demand will be high especially during the summer season while demonstrating the product superiority as the main competitor Starbucks lacks a similar product. Moreover, a price evaluation on the product reveals that the low pricing cost oriented approach will allow for increased demand against competitor and existing cake products as it will charge an average $3.49 per cake. In addition, the presence of multiple organizational stores located in the CBD with high traffic flow will allow for increased market success in the industry. Further, a promotion approach of increased posters placement in the stores, use of facebook and YouTube e shipper loyalty cards will allow the product stimulate enough demand. Similarly, an evaluation of the physical environment reveals that the coffee outlets will serve as key selling strategy promotion. Further, under the people mix the venture will increase employee understanding of the product gains and under the process mix will increase wages to the employee to motivate them as well as maintain appropriate financial statements t track the product market financial performance. 10.0Action and Control Program In order to develop a control program of the product launch and its market success, the organization will rely on the use of sale figures to examine if the product meets the expectations. Moreover, it will annually evaluate the profit and loss account statements to evaluate the nature of changing profit margins as well as the changing expenses to evaluate if the product performance is on the risk of decline. In this regard, the finance function as well as the marketing department staff and managers will be liable. The proposed overall marketing budget costs for the first four months upon launch are in the totals of $1.431 million. Finally, the product contingency plan challenges include unexpected rise in marketing costs as well as negative consumer feedback. In order to mitigate that the marketing and product development functions will conduct market surveys and establish budget deadlines in the market as Betz (2011, p.150) stated budget deadline increase performance success. Below is the developed adoption contingency plan Dependence Internal External Time This plan may not accomplish on time Customer Attitude Over budget Customer Attitude Customers reaction to the new products may be negative References Azizi, S. & Makkizadeh, V. 2012, "Consumer Decision-Making Style: The Case of Iranian Young Consumers", Journal of Management Research, vol. 4, no. 2, pp. 88-111. Betz, F. 2011, Managing technological innovation: Competitive advantage from change, Wiley, Hoboken, N.J. Brooks, G., Heffner, A. & Henderson, D. 2014, "A SWOT Analysis of Competitive Knowledge from Social Media for A Small Start-Up Business", the Review of Business Information Systems (Online), vol. 18, no. 1, pp. 23. Courville, S. 2003, "Use of Indicators to Compare Supply Chains in the Coffee Industry", Greener Management International, no. 43, pp. 93-105. Frey, B. S., 2002, Successful management by motivation: Balancing intrinsic and extrinsic incentives: with 11 tables, Springer, Berlin. Gloria Jean’s Coffees, 2014, About, [Online] Available at [Accessed October 22, 2014]. Hunt, S.D. & Arnett, D.B. 2004, "Market Segmentation Strategy, Competitive Advantage, and Public Policy: Grounding Segmentation Strategy in Resource-Advantage Theory", Australasian Marketing Journal, vol. 12, no. 1, pp. 7-25. Jolliffe, L. 2010, Coffee culture, destinations and tourism, Channel View Publications, Bristol. McLean, I.W. 2004, "Australian Economic Growth in Historical Perspective*", Economic Record, vol. 80, no. 250, pp. 330-345. Vulkan, N. (2003). The economics of e-commerce: A strategic guide to understanding and designing the online marketplace, Princeton University Press, Princeton, NJ. Read More