marketing management - carvel ppt

7/31/2019 Marketing Management - Carvel Ppt

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Carvel Ice CreamDeveloping the Beijing Market

Lara Doucette

John MacDonnell

Kevin Undershute

Nancy VanOirschot


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What are the problems?

Not meeting the companys expectations for ice

cream cake sales.

Carvel would like to work to increase their

brand awareness.


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Internal Analysis

Strengths

Stores are self-sufficient, decreasing transport costs.

Successful company in the North American market, so the

expatriates living in Beijing will recognize the product as a

familiarity from home.

Weaknesses

Smaller advertising budget.

Insufficient market data available to start.

Entering a market in which translations must be done to all

internal data. (ie. Computer systems, menu, etc.)


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Internal AnalysisOpportunities Partnership with Chinas Ministry of Agriculture.

70% of cake sales are from middle-upper class consumers.Carvel needs to capitalize on this and provide the entireexperience that this group wants.

Freezer loan programs can be beneficial if Carvel carries it outproperly by placing representatives in the stores more often andmaking sure their freezers are stocked and running.

Threats

Recent entrance of Haagen-Dazs and Baskin Robbins into theBeijing premium ice cream market.

Blind taste tests showed that many Chinese consumers still preferthe low-end variety of ice cream rather than premium varieties.


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External AnalysisPolitical:

1.5 billion Little Emperors between 5 and 12 in Beijing who aregetting everything they ask for after one child policy was imposedin 1979.

Chinas consumption of dairy products is on the rise, with icecream being the leading dairy product consumed after healthcareprofessionals encouraged this practice.

Chinas government may have laws regarding targeting productstowards children, so Carvel would have to make sure they areabiding by all laws.

Economical

China has seen a 75% increase in average annual base incomes

in the last three years, bringing about the possibility of middle-upper income workers spending more on luxuries like ice cream.

Carvel is dealing with consumers who have a smaller disposableincome than what the company is used to in the North Americanmarket.


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External AnalysisSocial Most Beijing consumers are not accustomed to buying dairy

products like ice cream, leaving an opportunity for Carvel toenter the market.

Beijing produces 30+ newspapers who are reaching hundredsof thousands of people.

Beijing consumers are known to be cautious about buying newproducts that they are not used to, due to the purchase riskinvolved.

Technological

The ice cream industry is not influenced by technology. Anyadvances in technology that will benefit companies will be usedindustry wide not giving any advantages to a particular firm.


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Consumer Segmentation

AnalysisMarkets Number of

PeopleWhat do they

want?Geographical

Expatriates 100 000 Familiar products

of their homecountry

Very

concentrated inspecific areas

Children 1.5 million Children are open

to anything as

long as it appeals

to them

Spread out

across different

areas of the city

Middle Upper

Class

Professionals

1.5 2.3 million High quality

products

Spread out but

also living in

wealthier areas


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4 Ps of MarketingPrice Decreasing prices to attempt to increase sales will

sacrifice Carvels quality imagine.

Carvel should mainly keep their prices on par with itscompetitors like Haagen-Dazs and Baskin Robbins.

Product

Carvel should introduce Little Loves and Piece of Cakeat a small cost to introduce consumers to their productand develop a loyal market that wants to keep goingback.

The company can scale back their menu and concentrateon only a few menu items that are performing well in theBeijing market.


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4 Ps of Marketing

Place

Carvel may consider closing 3 or 4 of their current

locations and focus more closely on generating revenue

in the remaining locations.

They should conduct research before closing or opening

any new stores and look into what locations were most

successful and what ones were not performing as well.

Carvel should attempt to open a location in the same

popular shopping district that Haagen-Dazs and BaskinRobbins have already set up.


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4 Ps of MarketingPromotion

Since radio and television are not viable ways of advertising,Carvel should take advantage of the 30+ daily and weeklynewspapers

Carvel could afford to produce 100 000 copies of the advertising

leaflet for 30 000 Rmb. that could be distributed by their uniformedemployees in popular shopping areas of the city and possibly beplaces in high end restaurants for customers to take home.

They can also afford to participate in the entertainment couponbook that would reach 10 000 upper income members each year.Even if Wang could not capitalize on knowing the publications

manager and purchase a placement for 2500 Rmb., Carvel couldstill afford the 4000 Rmb. placement.


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Strategic Alternatives1. Heavily market product toward youth aged 5-12 by

reaching them through schools, parks, childrens

activities etc. because 20% of Chinas pop. Is under

the age of 15.

Since there are 1.5 million children in China, we think

Carvel could reach between 10% and 25% of that

population. With 10% of them buying 2 cakes a year,

at an average cake cost of 110 Rmb. Carvel could

make 3.3 million Rmb. in revenues. With 25%, they

could make up to 8.25 million Rmb.


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Strategic Alternatives2. Direct Carvels marketing at middle-upper class

working professionals age 25-45 by opening stores

only in high-end locations (ie. restaurants) to build

exclusivity.

With 1.9 million people in this market, we think Carvel

could reach between 5% and 15% of their population. If

5% were to buy 2 cakes a year at an average cost of

110 Rmb. Carvel could make 2.1 million Rmb. in

revenues. If 15% were to do the same, they could

make 6.27 million Rmb.


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Strategic Alternatives3. Begin our marking process in Beijing with a short-term

focus on the expatriates. There are not many of themin comparison to the two other markets we couldtarget, which suits our current marketing budget. They

will recognize the brand and we will have easier sales.In the future we could expand to reach other markets.

If Carvel were able to reach 20% of this market, witheach of these people buying two cakes a year at 110

Rmb. they could have revenues of 4.4 million Rmb. Ifthey were able to reach 30%, their revenues couldreach up to 6.6 million Rmb.


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Recommendation To target children between the ages of 5-12.

These Little Emperors seem to be getting everythingthey want from their parents and two sets ofgrandparents.

New generation of youth being more educated aboutcold foods and dairy products unlike their parents andother elders.

Children are easy to appeal to and are always askingfor treats and other things that are targeted towardsthem.

marketing management - carvel ppt

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