how to make a marketing plan

University of the Philippines Visayas – Iloilo City Campus

College of Management

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I. CURRENT SITUATION

A. INTERNAL ANALYSIS: THE COMPANY

COMPANY PROFILE

Ruchel’s bakeshop is a family business owned by the Villanueva family located at Bolilao

Mandurriao, Iloilo City. It has been operating since 2006 until the present. The person who is in

charge with handling the people and operations of the bakeshop is the owner herself, Mrs.

Ruchel.

Before this bakeshop was built, there was only one bakery at the Barangay so there was

only one competitor. This other bakery was located at the other end of the barangay while

Ruchel’s Bakeshop was placed at the middle area of the barangay. The products offered by this

bakeshop are the traditional Filipino breads such as pandesal, hopia, buns, and the like. It also

caters personalized pastries such as cakes and cupcakes.

After a few years the owner decided to integrate a sari sari store and a carenderia to

increase profit and cater to the other needs of their customers. As of now, the number of products

made and the customers continue to grow.

CURRENT POSITION OF THE COMPANY/BRAND IN THE MARKET

Ruchel’s Bakeshop currently sales an estimated amount of 10,000 pieces of bread daily

out of the 15,000 pieces of bread produced. The demand for bread is constant throughout the

year and does not show any trend since bread is a daily necessity of a common Filipino citizen.

But the demand for personalized pastries such as cakes and cupcakes increase during Christmas

season since people tend to order more for the celebration of Noche Buena and New Year.



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COMPANY/BRAND STRENGTH AND WEAKNESSES ANALYSIS

The advantage of this bakeshop is that is does not offer only bread but also cakes and

other personalized pastries. Also, there is a sari sari store and carenderia within it and this helps

the bake shop cater other needs of the consumer.

A weakness of the bakeshop is that there is no division of labor when it comes to

management because the owner is the only one who handles most of the operations in their

business and this may cause confusion and errors.

BRAND CONSUMER PROFILE

The identified market segments of the bakeshop is through geographic, demographic,

demand size, growth potential, and the target market description. Geographically, the bakeshop

considers the neighborhood which is barangay Bolilao and the owners’ friends and the other

connections of their family. Demographically, they consider those who are stay at home people,

the SM City Iloilo workers since Bolilao is filled with apartments where most of these workers stay,

and lastly the students around. The demand size of this bakeshop is only small scale based on the

volume and sales because they do not have a big target market and so far, they do not have

plans to expand. Their possible growth potential is through word of mouth like referrals for

example. Lastly, their target market description are those people who are working, low to middle

class people, aged 15-45, and the people within the neighborhood.

The bakeshop addresses the physiological need of the consumers since it offers the basic

need of people which is food. In this case, consumers buy bread in a daily basis but mostly during

early mornings for their breakfast and late afternoons for their snacks.



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PRESENT MARKETING STRATEGY

Its target market of Ruchel’s bakeshop are the local people around the barangay roughly

aged 15 -45 (low to middle class, within the neighborhood, working people)

The point of parities of this bakeshop and other competitors is selling a common product which is

bread while the point of differentiation of this bakeshop from its competitors is that it sells cakes

and other special pastries. Also, it has a sari-sari store and carenderia with it.

In order to be a competitive organization, Ruchel’s bakeshop considers the affordability of

their products and of course the quality of their product. They make sure that the orders of the

people are given on time and that there are no delays in the operation as much as possible. Also,

they accept deliveries of other sari-sari stores who retail the bread of Ruchel’s Bakeshop.

Before the owner decided to put up this business, she considered the factors that may improve or

affect this bakeshop. They took into consideration the product they were going to produce, if the

people in the barangay need it or not. In this situation, there was only one bakery before Ruchel’s

bakeshop was put up so there is only one competitor. The place where it was put up was also

thought of. Since this other competitor was located at the other end of the barangay, the owner

decided to put up her bakery at the middle area of the barangay so that it may become

accessible to almost everyone around the barangay.



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B. EXTERNAL ANALYSIS

1. MACRO ENVIRONMENT ANALYSIS

a. POLITICO-LEGAL

1) Republic Act No. 7581 (THE PRICE ACT)

The Republic Act No. 7581 which states an act providing protection to consumers

by stabilizing the prizes of basic necessities and prime commodities and by prescribing

measures against undue price increases during emergency situations like occasions.

This is a threat since, if the prices of the products exceed the suggested retail

price, consumers tend to consider buying in competitors which will affect the sales the

business.

b. ECONOMIC

1) Inflation (Price Hike)

This is a threat because when prices of primary raw materials used in pastries and

bread increased; the prices of the products that will be available to market will

also increase, thus affecting consumer preference in buying certain product.

c. SOCIO-CULTURAL

1) Filipino Tradition especially celebrating special occasions

It is already a part of Filipino tradition to celebrate occasions with their families,

so it is considered an opportunity for the business to increase sales by selling

products such as cakes and other pastry products.



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2) Bread has been considered a primary commodity for Filipinos

Bread has been a part of the daily lives of Filipinos. This is an opportunity for the

business since bread is already considered a commodity; people will always

patronize bread despite certain factors.

d. TECHNOLOGY AND NATURAL ENVIRONMENT

1) Global Warming

This is a threat because the prices of raw materials will increase. Since global

warming results to climate change, the growth of crops which is primarily used as

inputs for bread.

2) Natural Calamities

This is a threat and also an opportunity. It is considered a threat because prices of

goods will increase. It is also an opportunity because as prices of basic commodity

(e.g rice) increases, the demand of bread which is a substitute commodity for rice

will increase.

3) Machineries and Equipment

This is a strength because production will increase as machineries and equipment

are deemed efficient than manual laborers.

2. MARKET ANALYSIS

a. DEMAND ESTIMATION

For our estimated and segmented demand size, we used the Chain-Ratio Method which involves

multiplying a base number by chain of adjusting percentage.

Chain-ratio method= n * q * p



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Chain-ratio method = number of potential buyers in the market * Average purchase quantity

per year * price of an average unit.

Since the target markets of the business are the residents of Bolilao Manduriao, the population

was used to estimate the demand of the products.

Annual Estimated Demand in Peso:

Year Solution Result

2011 3, 600,000* 6461*5 116,829,800,000

2012 3, 600,000* 6461*5 116,829,800,000

2013 3, 600,000* 6461*5 116,829,800,000

2014 3, 600,000* 6461*5 116,829,800,000

b. MARKET TRENDS

Ruchel’s Bakeshop has a constant market trend, since it has constant demand from

2011 to 2014. Since bread is a necessity, the demand does not significantly change. Even if

prices would increase due to inflation, its demand is still elastic, which means price does not affect



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the demand of the product. In contrast, demand for pastry only rises when there are special

holidays such as Christmas and New Year.

c. GROWTH POTENTIAL

Given that Ruchel’s Bakeshop has no plans of expansion, and their ways of promoting their

product is by word of mouth, growth potential of the bakeshop is minimal however, due to the

fact that its sales are constant, the trend of growth potential is increasing but not significantly.

3. CONSUMER ANALYSIS

a. CONSUMER NEEDS

Filipinos consider bread with the likes of pandesal, and pande leche as a basic necessity

regardless of what status you are in. The bread store was built up in the first place in order to

satisfy that need of the consumers in that area with convenience. Without the bread store, it

wouldn’t be convenient for the people in their area for them to acquire bread since (1) they will

have to go to the nearest bread store which is in SM City, (2) they will have to wait for the bread

vendor who roams around the city, or (3) they would have to create their own which will be more

costly if the purpose is for their own consumption.

b. BUYING SITUATION

Customers who are accustomed with the store always go back because of the variety of food the

store offers. Compared to other bread stores, Ruchel’s bread store has a carinderia and

convenience store that provides the people a great amount of choices what to buy.

Buying bread is already a habit for Filipinos since bread is considered a necessity that’s why



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people buy bread any time of the day everyday but mostly early mornings and late afternoons.

In addition, pastries such as cakes and cupcakes are already a part of a traditional Filipino

celebration.

Fig.1

Source:http://www.rappler.com/move-ph/issues/hunger/88174-top-food-products-commonly-

consumed-filipinos

c. FACTORS THAT AFFECT HUMAN BEHAVIOR

The different factors affecting the business would be majorly on the cultural aspect. Regardless of

age, income bracket, sex and gender, as long as the person is a Filipino or someone who was

exposed to the Filipino culture, consuming bread such as pandesal, hopia, and the like for

breakfast and meryenda and buying cakes for special occasions such as birthdays, anniversaries,

Christmas and many more is not just a mere want but a necessity.



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4. COMPETITOR’S ANALYSIS

a. COMPETITIVE POSITIONING

Ruchel’s bread store has two direct competitors in the market. They were considered as

competitors since (1) they have the same primary market which is the neighborhood, (2) they sell

exactly the same product which is bread, (3) and if ever there are changes in the quality of the

product, the difference would be in a minimal or simply if you are to eat both products, you

wouldn’t know the difference. With the current situation, it will be up to the Place, Price, and

Promotions to keep the business competitive.

The edge of Ruchel’s breadstore compared to others is that it has a convenience store and a

carinderia or a small canteen with it which would make things more convenient for the consumers.

Having a one stop shop establishment near the vicinity would really help a person save time and

energy.

b. MARKETING STRATEGIES

a. TARGET MARKET

i. TOTOY’S PANADERIA

The market of Totoys Panaderia would be those in the neighborhood regardless of age,

gender, etc. It is presumed that basing on the success of Ruchel’s Breadstore, the owner enters the

market in order to gain from it.

ii. CORTEZ BAKERY

The target market of this competitor would be the same since it is situated in the

neighborhood.



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iii. Tibiao Bakery

Although competition is indirect, Tibiao Bakery’s target market would be the general

public who are knowledgeable of this bakery. Tibiao Bakery has branches all over Iloilo affecting

even those in the neighborhood. They would also sell their product to famous convenience store

such as 7/11 and Go Mart in order to reach the public even more.

iv. Angelina’s Bakeshop

The competition would remain the same with Tibiao Bakery. It’s target market is the

general public and not only in Iloilo but in the entire Region 6. However the distribution of their

products is through retailing by partnering with supermarkets.

b. BRAND POSITIONING

i. Points of Parity

1. First Competitor

The product is the same, the quality of the bread is the same, and the pricing is

competitive. The main target market is the same as well.

2. Second Competitor

The product is the same, the quality of the bread is the same, and the pricing is

competitive. The main target market is the same as well.

3. Tibiao

Offers same kind of bread and has a restaurant-like set up which means they offer meals

and different snacks aside from bread.



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4. Angelina

Ruchel’s Bakeshop also delivers to other sari-sari store for retailing just like the strategy of

Angelina Bakeshop.

ii. Points of Difference

1. First Competitor

Ruchel’s offer more products such as a different variety of bread, it has a carinderia or

canteen that offers meals, and a sari sari store for the convenience of customers.

2. Second Competitor

Ruchel’s offer more products such as a different variety of bread, it has a carinderia or

canteen that offers meals, and a sari sari store for the convenience of customers.

3. Tibiao

Ruchel’s produces cakes and cheaper bread compared to Tibia due to commercialization

however Tibiao has an effective and efficient marketing since it’s simple yet attractive. It also has

different branches in Iloilo and extends to famous convenience stores.

4. Angelina

Ruchel’s offer more products such as hopia, and other native bread. Angelina focuses more

on its no-hole bread which Ruchel doesn’t have. Promotion of Angelina exceeds far comparing to

the promotions of Ruchel’s which solely relies on the word of mouth.



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c. MARKETING MIX

TOTOY’S PANADERIA

Product

● Traditional Filipino bread

● freshly baked

Price

● suggested by DTI( suggested retail

price)

Place

● Front of Motorcycle station

● Other side of the neighborhood

Promotion

● Customer relation

CORTEZ’ BAKERY

Product

● Traditional Filipino Bread

Price

● suggested by DTI( suggested retail

price)

Place

● Near Ruchel’s Bread store

● After water station

● Center of neighborhood

Promotion

● Word of mouth



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Tibiao Bakery

Product

● Wide range of quality products

● known brand

● excellent packaging

● Native delicacies

Price

● affordable Value added products

Place

● establish branches on different

provinces in Panay

● Well-ventilated and fresh warehouse

Promotion

● Print ads

● Billboards

● Radio ads

Angelina Bakeshop

Product

● Unique textured products

● good packaging

Price

● discount on bulk orders

Place

● Main manufacturing firm located at

Chinatown

● well ventilated warehouse

Promotion

● Print ads

● Radio



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B. STRENGTH AND WEAKNESSES OF COMPETITION

All of the competitors almost had the same target market, which are ilonggos. In

terms of the products that they offer, they only vary with their creativity and unique

recipes. Their common products is in competition on who have the cheaper product while

still having the same satisfaction. Another thing is that, direct competitors don’t engage or

even try to invest in promotion. Ilonggos are fond of saving their money and will just spend

on something with greater value. Consecutively, for this small time businesses, promotion

and advertising are expensive luxury because in fact, major media or channel for ads are

very costly.

Tibiao bakery and Angelina bakeshop are just two of the indirect competitors of

Ruchel’s bread store. Even though they are known name in the city, people living away

from their branches will search other alternatives. Ilonggos will not travel for more than 20

minutes just to buy bread or delicacies. Small bread stores will be the alternative for this

problem, and with additional creative ideas, people will have no other choice but to be

loyal on them.



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II. STRENGTH, WEAKNESSES, OPPORTUNITIES, and THREATS ANALYSIS and

CRITICAL ISSUES

A. SWOT ANALYSIS

Strength

-also operates as a carenderia and sari sari

store

-offers personalized pastries

-taste of the products

-price of the product

-location

Opportunity

-loyal customers

-Filipino tradition

Weakness

-solely managed by the owner

-lack of promotion

Threat

-located nearby SM City

-establishment of new competitors in the

neighborhood

One of the unique characteristics of Ruchel’s bread store that separates it from others is

that it does not only sell bread but also functions as a carenderia. They offer a variety of

traditional Filipino meals that satisfies the taste buds of hungry costumers with in a budget

friendly price range. Aside from the meals, the local bread store is also a small sari sari store that



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sells the daily commodity needs of the customers. And because of these, costumers often choose

Ruchel’s bread store than other nearby bread stores. As a customer, why would you buy bread

from another bread store then go somewhere else to look for a sari ari store and buy a sachet of

shampoo when you can do both in one transaction? Ruchel’s bread store reduces the needed time

and effort of the customers. Unlike other bread stores, Ruchel’s bread store also accepts orders

for personalized pastries such as cakes for different occasions in accordance to the designs

requested by the customers. One of the reasons why customers also keep on going back to buy

bread from the bread store is because of the taste of its products. Mrs. Villanueva keeps in mind

that the prices should be reasonable and cheap but without the need of compromising its quality.

The products sold are also assured that they are fresh and newly baked. In the circumstance that

the breads are not sold, they are being reused and baked as pudding and more so that it will not

go to waste. The location of the bread store can also be considered as an advantage since it is

located at the center of Bolilao therefore easily accessible by its surrounding neighbors.

Mrs. Ruchel Villanueva, the owner of Ruchel’s bread store manages all operations

concerning the bread store. All decisions are made by her. Such as how much inventory of raw

materials should be bought and stored. Who should they hire and she chooses the designation of

work such as who does who. She is also responsible for computing the sales, expenses and other

financial concerns and also counting of the money. Most of the times she also personally mans the

bread store and helps bake orders. Though it is good for the owner to have a hands-on on the

business, sometimes doing everything by herself can cause confusion and errors. There is no third

person to verify and correct the work and in the absence of Mrs. Villanueva, there is no one to

take over. Since the bread store is considered a small scale business, it has doesn’t yet have



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proper marketing strategy or any promotion tactics and simply relies on the word of mouth for

their products to be known, therefore it limits its potential of expanding their target market.

Ruchel’s bread store is one the pioneering bread stores in the neighborhood, therefore has

already established a name and has proven the quality of the product. This led to a continually

growing number of loyal customers and even though new competitors rise, customers still looks for

the taste of Ruchel’s bread. The local bread store does not have any marketing strategy but it

became popular simply through word of mouth. Loyal customers are the bread store’s best

marketing team. And since bread will always be a part of a Filipino’s breakfast or afternoon

snack. It has been a long time tradition for Filipinos to wake up in the morning and enjoy a newly

baked pandesal partnered with hot coffee or enjoy a peaceful afternoon with a sweet bread

and a glass of juice. This Filipino tradition is one of the reasons why the bread store still stands

until today.

Ruchel’s bread store is located at Bolilao, Jaro, Iloilo City and is in front of SM City that’s

why the mall is considered an indirect competition. People going to SM City would often choose to

buy bread from the mall before going home for lesser hassle and more convenience rather than

find time to go to the bread store. But a bigger threat for Ruchel’s bread store would be its direct

competitors or other local bread store in the neighborhood and would sometimes be a cause for

people living farther away from the bread store to choose another local bread store selling the

same type of bread that is closer to their vicinity. Since the bread stores sell almost the same

types of bread, there is only a little advantage that each store has over the other.



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B. CRITICAL ISSUES

What is the market gap or need to be satisfied?

Being the first bread store in the area, it can be presumed that Ruchel’s Bread Store was

founded in order to provide fresh and delicious bread for the neighborhood and to make the

acquisition of the latter more convenient. So rather than waiting for the bread vendor who roams

around the city with no assurance that your favorite bread is still in stock or making your stomach

wait early in the morning and hoping for the vendor to come, neighbors and those concerned could

just walk a couple of meters in order to satisfy their or the household’s need of consumption of

bread.

Values that are important to target market

Filipinos do not like hassle in their everyday activities, especially when doing errands which

would result in going around the vicinity and all. Ruchel’s Bread Store knows that fact and wanted

to help the target market. The store doesn’t just sell different varieties of bread; it actually provides

customers with different crops such as sweet corn, cooks different meals and dishes for daily

consumption, retails different products from hygienic to school materials to junk foods which are

another Filipino necessity, and many more.

The bread store also accepts feedbacks from the customers and that they treat these

comments seriously for the benefit of the bread store. This is one way to enable to adjust the

different products to the satisfaction of the customers. It could be one factor on why the store is able

to sustain through the years.

How to effectively differentiate your value-offer from competition?

The bread store, as stated in the Target Market, aims to satisfy the people in the

neighborhood and others who are concerned such as friends, referrals, etc. We could say that



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acquiring bread early in the morning is a necessity for traditional Filipinos but acquiring hot and

fresh bread is a want that every Filipinos would demand. This is just one of the specifications that

the bread store could offer but however specifications would differ from the product such as the

case of the pandesal vs cake where cake could be specified in a lot of ways. Ruchel’s Bread Store,

if demanded, would provide those goods and specifications for the customer.

Filipinos are also thrifty in some ways moreover; those in the neighborhood are not mostly

members of those higher income brackets. That’s why Ruchel Bread Store has breads priced in the

most optimal and affordable way there is in order to attract the market and to keep up with

competition.

What are the key factors to success?

The business is successful, and every time a business becomes successful, it will always attract

competitors into opening the same business, with same or even more things to offer for the market.

Ruchel Bread Store for instance has two competitors in the Neighborhood which is already a threat

given that their markets are in common which would mean competition will take place. Bread will

always be the same, competitors bake bread with the same quality but what gives the edge to

Ruchel Bread Store is the convenience (having a one stop shop), variety (different bread are sold),

location (strategically located in the center).

What types of core competencies must be developed to be successful?

What makes the bread store alive are the “suki” or loyal customers of the bakery. They

remain as customers for the reason that they love the bread and that they continue to love it because

of the consistent quality of the bread. Another factor could be that the store offers affordable

products which would mean that mark ups are in the optimum. And the loyal customers just keep

growing and growing due to word of mouth by friends and loyal customers. The bread store



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innovates as well by increasing the different varieties of the product as well in order to be able to

compete in the market.

However, the bread store lacks promotions with its product especially to their specialized

cakes. The only available way for them to promote, is through the word of mouth. They have the

place, the price and the product but they lack the promotional aspect of the Marketing Mix. It could

be in any form like through flyers, signs, improved packaging. Completing the 4 Aspects of the

Marketing Mix would increase the opportunities of the business. Who knows what the business can

actually be capable of?

What critical issues likely to affect the attainment of objectives and which must be addressed

in the Marketing Plan?

Of all the issues stated above, what is needed to be tackled is the promotional aspect of

the business. Moreover, we also have to retain or improve the others such as being able to respond

to feedbacks, catering to the needs and values of the market and so on. Since it is already assumed

that when the 4Ps combines and works together, it will make the market of the business even bigger.

This Marketing Plan will focus on creating promotional activities for the business, make it grow and

continue to retain the other values.

III. IDENTIFIED MARKETING OPPORTUNITY

1. Grow Customer Base Not Just Consumer Base

Given the limited resources to promote the bakery and its products due to its small size, the

best way to reach more consumers and earn more is by growing the business together with

customers. These customers are also small businesses that will make the products of Ruchel’s

Bakeshop available to different locations without necessarily putting up new bakeries and



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manpower. This can be achieved by catering to a new market: school canteens or cooperatives in

Iloilo City.

A consignment strategy can be used as a distribution technique to make the products of the

bakery available to a larger consumer base: students and teachers. The agreement is simple, the

new customer base which is the school canteens or cooperatives will be able to profit from retailing

bread from the bakery and in turn, Ruchel’s bakery will also gain revenue from each piece of bread

sold. However, part of the agreement is that once the bread will not be sold at the end of the day,

Ruchel’s bakeshop will have to take the inventory back. It is the same as asking somebody to sell

your products for you allowing them to profit from selling it at a higher price. In this way, it will be

a win-win situation for the customers and they will likely partner with the bakery. Although Ruchel’s

bakery will still be faced with the risk of having bread not sold for the day, at least it will be able

to penetrate a wider market other than its current target market.

In general, this is an opportunity for Ruchel’s bakery to create sustainable relationships with

customers and as a result, grow its customer base.

2. Innovation

Innovation can be a potential catalyst for the growth and success of Ruchel’s bakery and help

it adapt and grow in the market. One way to apply innovation is to consider a major change in the

value proposition of its products and take advantage of the market trends and consumer

preferences.

All other competitors can address the need of the consumers which is providing them their daily

bread needs for breakfast or merienda. But the thing that can set Ruchel’s bakery apart from thr

competitors is providing not only consumers need but what the consumers want. This want can be

derived from the current market trend evident in the food industry: the healthy trend.



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Consumers are becoming more health-conscious and are pressingly concerned about what

they are eating. Today's consumers are increasingly driven to local, natural, organic and sustainable

offerings—and are willing to pay more for them. This is the reason why restaurants offering healthy

food charge more expensively compared to ordinary restaurants – it is not about product cost but

it is about health. Consumers are buying health compared to the product itself. We can leverage

on this insight by being the first in the vicinity to offer healthy bread at an affordable price.

3. High quality products at reasonable prices

4. Leveraging on taste: Bread Flavor

IV. PROPOSED TARGET MARKET

Our target market is people and their satisfaction. To achieve this target, the term can be

explained in the following ways.

SEGMENTATION

Geographic Segmentation

The immediate target market is the residents of Bolilao Mandurriao. There

are roughly 6461 people who are residing in this Barangay. And from this

population, Ruchel’s Breadstore will target only those who are wage

earners who seek to a Bakeshop which offers a wide range of bread and

pastry products.



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Demographic Segmentation

In the demographic segmentation, Ruchel’s Breadstore classified the

costumers in the following parameters.

o Income

o Age

o Gender

o Family Life Cycle

The above mentioned parameters will respond in the following situations:

Parameter

Description

Income

All ranges of wage

Age

All ages

Gender

All Genders

Family Life Cycle Young adults, single, large and small sized

family



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Psychographic Segmentation

Ruchel’s Breadstore offers variety of bread and pastry since costumers

have different preference.

o Lifestyle

o Personality

o Social

Parameter Description

Lifestyle

Personal Interest, activities, opinions

Social Class

All classes

Personality

Sweets and food lover

V. FINANCIAL AND MARKETING GOALS / OBJECTIVES

A. FINANCIAL OBJECTIVES

The objective of this Marketing Plan is to increase the sales and profit of Ruchel’s Bakery

through promotion. Since the Sales of this bakeshop has been constant for the past years, it seems

like there is no improvement or progress happening, and if there is, it is not visible in their profits.



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Since there is already a given estimate of the sales, let us go back to what was discussed

earlier. We have used this equation to find out the Annual Estimated Demand of this bakeshop.

Chain-ratio method= n * q * p

Chain-ratio method = number of potential buyers in the market * Average purchase quantity per

year * price of an average unit.

With this equation we were able to come up with the value of 116,829,800,000 annually.

Since the objective of this marketing plan is to increase the sales and profit by at least ten to fifteen

percent annually. If this happens, there is a possibility of an increase of 11,682,980,000 to

17,524,470,000 in the annual demand of this bakeshop. The question here now is how we are able

to successfully increase the demand of the products of Ruchel’s Bakeshop. This will be discussed in

our marketing objectives.

B. MARKETING OBJECTIVES

Ruchel’s bread store is a small scale family business and the owner, Mrs. Ruchel Villanueva

does not have any plans to expand therefore marketing strategies and proper promotions are

not in her priorities. The bread store simply relies on the word of mouth and customer relations for

their promotion. Thus we aim to create a marketing strategy that will aid in the bread’s store

promotion. These strategies will be designed in order for the increase in brand awareness of the

product and will expand their target market beyond their neighbourhood. Only a few people

know about the personalized pastry making service of the breads store and since they do not

display the pastries such as the cakes, cupcakes and cookies and all are made to order, people

are not informed of this unless they personally make inquiries. Since the breads being sold in the

bread store are nearly identical if not identical at all with each other thus people do not have



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any distinction of the products. With taste alone, costumers have difficulty in differentiating the

products. Thus, we aim to make a marketing strategy that will separate Ruchel’s bread store from

that of others, and therefore establish a brand distinction. Of course, the aim of every business is

to gain profit, thus by creating and implementing a proper marketing strategy will lead to a

larger target market, increase in brand awareness, establish a brand distinction and will lead to

an increase in sales volume. If Ruchel’s bread store has proper branding, an increase in number of

customers will thus increase the bread store’s profit.

VI. MARKETING STRATEGY

A. ANSOFF’S MATRIX

a. Market Development

Ruchel’s breadstore is situated only in Bolilao Iloilo hence the main target

market of the entity is only the people who lives there. Moreover in order to reach

more markets, Ruchel’s Breadstore would have to expand its operations but given

the workforce that the entity has, expansion would be hard unless they would

increase the human resources.

Given the situation, one way that the store can actually expand without the

expense of increasing human resources, is to consign their products to other

establishments such as canteens like in the UPV or café like moonleaf. This way, the

products of Ruchel’s Breadstore can actually reach other market segments such as

students in different levels and also professionals who actually have the buying

capacity. This can also serve as promotion for their products because consumers will

be able to know the branding.



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Another that Ruchel’s can take advantage of is the social media such as

Facebook, Twitter, and Instagram. In this way Ruchel’s can actually reach greater

markets given the network that the social media provides. Ruchel’s can actually

create a social media account for them to market their product like posting their

delicacies, pastries, and many more; and would actually receive orders in the

internet which makes things even more efficient.

b. Market Penetration

Ruchel’s breadstore has loyal customers. As an entity, these customers should

remain loyal and the number of loyal customers should increase as well. However,

due to the risk of increasing competitors direct and indirect, loyal customers could

easily switch brands. Ruchel’s can offer tie ups like buy 10 get 2 offer or buy 5 get

1 during special occasions for loyal customers, or offer free newly released products

during special occasions so that loyal customers would feel that they get more value

than what they paid for and it would eventually promote these products. When they

like it, they would continue to buy it.

Ruchel’s could offer delivery services for orders worth a certain price just like

in the case of McDonalds, with this, Ruchel’s increase its reach to its consumers,

Ruchel’s going to them instead of them going to the store especially with bulk orders

is a good way to increase penetration in the existing market.

If Ruchel’s will have to consign to other establishments, in order for the

product to look appealing, Ruchel’s can provide a certain packaging suited in the

eyes to the younger customer base. Increasing capture rate is another key in

penetrating the market.



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c. Diversification

Ruchel’s breadstore does not only produce native bread. They also produce

different kinds of cake and pastries. The selling of bread however overshadows the

cake and pastries given that human resources are more focused in producing the

different native bread. In order to diversify the entity, Ruchel’s can convert their

ordinary bakery into a café just like Maridel’s in Plazuela Iloilo that offers different

variety of cake, although Maridel’s target market are those that are high end

consumers due to the fact of high prices, Ruchel’s would continue to serve the masses

and its target market which is the neighbourhood which means prices would remain

as is or simply that would make it affordable for the neighbours. Ruchel’s can

actually follow this since Maridels is somehow successful and continues to operate. In

this way as well, Ruchel’s actually can take advantage of this generation given that

cafés are in demand especially with students who actually want a peaceful place

to study and professionals who would do business meetings on such a place. Native

breads will still be served but on a lower scale.

d. Product Development

Ruchel’s breadstore offers one of the most affordable bread in town. Its

competitors also offer one of the most affordable bread in town. Quality is

optimized with price. It is already a presumption that as quality increases so will

price and vice versa. Quality is the same with competitors. Changing the quality of

the product would mean increasing the price which would mean making it not



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competitive in the market. What Ruchel’s can do is to produce more variety of bread

that can only be located in Ruchel’s.

Ruchel’s can also take advantage of the seasonal trends and would offer

certain products on those seasons only. Like during Valentines, Ruchel’s would offer

heart shaped pastries or bread since these kinds of things are usually bought, during

Halloween, play with Halloween colors and designs for pastries, during Summer,

offer sun shaped or designed cookise, etc.

e. Results

Basing on our analysis and given the condition of the company today, the Product Development

and the Market Development are the most feasible among the 4 since it presents less risk and

more benefits for the company and if cost-benefit analysis was used, Product Development and

Market Development are more favorable.

B. BRAND POSITIONING

a. Target Market

The target market of Ruchel’s bakeshop is the masses within and outside the

neighbourhood who are looking for cakes and pastries especially bread as a daily

necessity.

b. Competitive Frame of Reference

In the breadstore market, Ruchel’s Bakeshop does not only compete with

other bakeries in the neighbourhood. It also competes with cafés in terms of pastry

offerings, grocery stores and convenience stores in terms of non-pastry good

offerings and fast food restaurants in terms of meal offerings.



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c. POD and POP

Ruchel’s compared to other competitors believes on service that is not only

convenient but also affordable at the same time. Malls and other convenience store

may be convenient (parity) but prices are rocket high (difference) and nearby

breadstores may be affordable (parity) but they are not convenient (difference).

d. Value Proposition

Ruchel’s bakestore creates affordable and fresh bread daily. They serve it

as how the customer likes it and when customer enjoys their products they can enjoy

some more with the other services Ruchel’s has to offer.

e. Support or Reason to Believe

Availability of cakes and pastries in product portfolio and low cost Products.

Specialized cakes are done through orders which can be assumed baked after

requested.

C. MARKETING MIX

i. PRODUCT STRATEGY

1. Product Objective

To improve the quality of the products

To introduce the products into a larger market

To highlight the pastry products without shadowing the current

traditional breads



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2. Product Strategy

a) Components of the Market Offering

Since the bread that is offered by Ruchel’s bread store is closely identical

to those of the other bread stores, the current traditional breads’ taste and flavor

should be enhanced in a way that prices will not drastically change or increase

beyond the willingness to pay of the customers.

One of the major advantage of Ruchel’s bread store over the other

competitors is its personalized pastries services therefore this advantage should be

heightened. This service is not well known to the people since those who purchase

this are usually only the relatives or close friends of the owner. We plan to

promote this service to a bigger target market and make more of these pastries to

sell in a daily basis or weekly basis.

Introducing a new set of product such as the seasonally trending pastries

where in pastries are specifically made for a particular season or occasion such as

heart shaped cookies for Valentines, Christmas themed cakes or Halloween themed

cupcakes will put Ruchel’s bread store above others. This product is expected to set

a trend in the bread store business and thus increase income.

b) Branding Objective and Strategy

To have proper distinction from other local bread store

To be known by a bigger target market

To establish a proper brand

In order to achieve the branding objectives, a proper marketing plan

should be implemented by Ruchel’s bread store. Promotions for the improved



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products and new products should be established well. For products that will be

consigned, a packaging for the products that will show the brand and make

people notice and remember Ruchel’s bread store should be made. The bread

store’s logo and tagline should be included in the packaging and in the other

medium of promotions such as posters, banners and social network pages.

ii. PRICE (COST) STRATEGY

a) Pricing Objective

To make the prices affordable for the customers

To maintain the budget friendly price of the products

b) Consideration in setting the price

The target market

The quality and quantity of the products

The raw materials used

The marginal propensity to consume of the customers

The willingness to pay of the customers

c) Pricing Strategy

To ensure the affordability of the products, both quality and price of

raw materials are considered. The most cost efficient materials that will result in

optimizing the taste and quality of the products will be used for the making of the

products. Food establishments that are most well-known but asks for the smallest

amount of percentage for the consignment will be chosen. Since Ruchel’s bread



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store hasn’t established a well-known brand yet, it is vital to ensure that its loyal

customers will not be greatly affected by the change of prices and will further

increase the number of customers thus increasing income.

d) Price Adjustment Strategies

For the consignment and new products, introductory prices will first

be implemented so that customers will have more chances to taste the products and

will garner a bigger number of customers. If the demand increases, so will the

price and until the bread store has not yet properly established its brand, it is wise

to keep the prices at an affordable level.

Gradual increase in prices will also be made to the current

products if ever there is a need when there qualities are further improved. This

gradual change will help the customers cope up easier to the increase in price

rather than abruptly increasing the prices and risk losing the bread store’s current

customers

iii. PLACE

a) Place Objectives

To find food establishments whose target market are consumers

with buying capacities

To find food establishments that is located conveniently and is

accessible to the majority of the target market

To enhance the current exterior and interior design of the bread

store



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b) Criteria used in evaluating channels

Location

Target Market

Cost of consignment\

c) Types of intermediaries or channels used

Consignments- Ruchel’s bread store will partner with a current

Food establishment in order for their products to be sold in their

organization

Deliveries- Ruchel’s bread store currently delivers their

traditional breads to customers who buys in bulks and the

breads are also roamed around the neighborhood or nearby

places for better distribution. We plan to have a door to door

delivery of the personalized pastries as to decrease the

inconvenience for the customers.

Pick up- if the customer wishes to pick up the pastries or bulks of

bread from the store is also within the customer’s discretion if it

is the more convenient way for them.

Display- a variety of pastries and bread will also displayed in

the bread store for customers to see and for them to be able to

buy the bread or the pastry at that exact moment. Being able

to display products that are at hand and customers are able to

buy immediately will decrease the amount of time needed to

prepare the order for both the customer and the bread store.



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d) The responsibility of the intermediary/channel

It is the responsibility of the consignee to ensure that the

products are well promoted to their customers to ensure the

optimization of sales and also to avoid the destruction of the

products while it is under their care. It is also their responsibility

to show proofs of payment and make a financial statement that

will ensure the accuracy and credibility of the profit made.

e) Incentives given to the channels to motivate them

The consignee will be given a percentage of the sales they

have made or of the products they have sold.

iv. PROMOTIONS (COMMUNICATION)

PULL STRATEGY

Our marketing communication mix would be a combination of advertising, direct

marketing, personal selling, and public relations. All of these would help promote Ruchel’s

Bakeshop.

Advertising would make the bakeshop known to more people. Not just in their

neighborhood but also outside their neighborhood. Personal Selling and Public Relations

would create good relationships between the customer and the seller that would build trust

between them.

Examples on how the bakeshop would advertise itself is through posters with complete

details so that people may know about them. Also, they may put stickers on the packages of

their products with contact details and address so that the people who would discover their

pastries would be able to contact them easily. How they would work on personal selling and



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public relations may be through personal deliveries and through the seller’s relationship with

their customers.

PUSH STRATEGY

Our push strategy would be similar with our pull strategy. Since what the bakeshop is

selling is basically a need of the people, it would be easy to encourage them to buy our

products. The only difficulty we may encounter here is probably the competitors around.

v. PEOPLE

The people targeted by this bakeshop are the ones around the neighborhood. The target

market would now expand to a larger scale if the bakeshop would promote itself to attract

more people and gain more customers.

VII. ACTION PROGRAM AND IMPLEMENTATION SCHEDULE

WHAT WILL BE DONE?

The activities that will be done would be more on promoting and advertising the products

of Ruchel’s Bakeshop. Also, a bit of improvement on how employees converse and deal with the

bakeshops customers.

WHEN WILL IT START AND END?

After proposing the marketing plan, as soon as the bakeshop approves it, the said plan

will be taken action as soon as possible. Since this plan focuses more on promoting and

advertising the product, it doesn’t really end. Every month or year, the bakeshop should prepare

a new set of promotions and advertisements in order for it to grow and grow every day.



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HOW MUCH WILL IT COST?

The planned ways of promoting this bakeshop is not too costly. The allotment of an

estimated budget of 50,000 to 100,000 pesos would probably be enough for the bakeshop

since the proposed activities for this bakeshop only allots money for printing posters and stickers.

VIII. FINANCIAL FORECASTS

Given that our target unit sales for the year 2016 is 4,000,000 units and our percentage growth

is 10% we now forecasted the sales in the preceding 4 years.

Our forecasted sales in 2016 is 20 million php and increases by 2 million php per year.

Year 2016 2017 2018 2019

Target unit sales 4,000,000 4,400,000 4,800,000 5,200,000

Forecasted sales 20,000,000 22,000,000 24,000,000 26,000,000

IX. CONTROLS

Controlling, in general, is the process of monitoring activities to ensure that they are being

accomplished as planned and of correcting any significant deviations. Marketing control is used

by business owners to monitor and evaluate the current marketing strategies to identify needed

adjustments and set guidelines for the future to achieve marketing and business goals. The control

process starts with measuring actual performance, then comparing actual performance against a

standard, and lastly, taking action to correct deviations or inadequate standards.



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Customer Feedback. Marketing is designed to persuade consumers to purchase a product or

invest in a service. One control put into place in any marketing plan is the monitoring of customer

feedback through polls and surveys. Customers can be reached indirectly by hosting online polls

on the Internet that ask specific questions about the latest marketing plan. Conversely, surveys can

be done with marketing groups or via individual interviews by phone or in person. Adjust the

marketing plan according to the results of the research. The strategies used that are not effective

must be eliminated to improve the performance of the company.

Budgeting. A marketing budget is a balance between the cost of generating the materials and

the revenue created by the marketing plan. Costs being incurred by the company must be

monitored in order to know if the company is using the resources efficiently. All of these costs need

to be closely monitored to minimize spending and maximize profitability. By examining expenses,

the company is able maintain the budget and see exactly where spending increases come from.

Competitor Analysis. A company needs to know how the products, services and marketing

strategy compare to local, regional, national and international competitors to retain existing

customers and attract new ones. Competitor analysis involves checking out the new products or

services offered by the competitors, examining their marketing strategies and determining

whether they are succeeding or failing with their businesses. The company must use this

information to adjust your strategies accordingly.

Customer Analysis. Another way to monitor and evaluate the marketing is to perform an existing

customer analysis to provide a detailed picture of the types of customers buying the products or

services. The company might consider gathering data about the consumers like their lifestyle, their

age, social class where they belong and other information that might help the company segment

its customers.



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how to make a marketing plan

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