The main points I have described in this report are the marketing strategies adopted by other similar companies in the ice-cream market, possible new marketing strategies and possible new technological marketing possibilities. I have also looked at the affect that specific marketing strategies have had on the companies and whether they proved successful in their aim of appealing to consumers.
The main points of my report are based in the findings section. There I have gone into greater detail about these points and information and findings that will influence my conclusions on these points.
During my investigations I have found out information in two forms of research, primary (field) and secondary (desk). For my primary research I was a member of a market research group. Other members of my group included Mark Bain, Ben Gardner and Tom Ellard. Together, as a group, we created a questionnaire for members of the public to give us information on the ice cream and consumer information and opinions associated with ice cream. We did this so that we could best advise the directors of Venetian Ices Ltd on the best possible marketing opportunities available to the company and those that would be most beneficial to the firm.
In designing the questionnaire there were many factors that we had to take into account before producing actual questions. First we decided that all questions in our questionnaire must be clear, unambiguous and give simple results. There are two reasons why we decided this. The first was that the people being interviewed would be able to fill out the questionnaire quickly and with ease so that they would be more willing to take part in the questionnaire, the quicker questionnaires can be filled out the more results can be taken so we were left with a wide range of accurate results. The second reason was that we would be left with statistical data, which we could easily convert into graphical form and enable us to make clear accurate judgements from our findings.
Once we had decided on the questions that we thought would be most practical to use we had to choose the most efficient method of sampling. Sampling is the system of choosing a sample of the public that would best represent the widest range of different types of people. The reason sampling is used is because conducting primary research on everybody who may or may not use the product would take a long time and would be inefficient so a method of sampling is used. There are two main types of sampling.
The first type is random sampling. Random sampling involves the use of a computer to select the people to be interviewed in such a way that everybody has an equal chance of being selected and many different types of people can be selected. The main drawbacks of random sampling are that it is very time consuming and requires access to the technology that carries out this method of sampling. We did not have the time or access to the technology required so this method was too inefficient for our market research group to use. Our market research group used the second main type of sampling, which is quota sampling. Quota sampling involves a certain amount of people being interviewed and, out of this amount; a certain number of each type of people must be interviewed. We used this method, as it was the most efficient and practical for us to use. Our final questionnaire can be seen in the Appendix (Item No. 1)
From the primary research conducted by my market research group we found many things. Firstly we found that 85% of people interviewed do like to eat ice cream (Item No. 2 of Appendix), showing that there is actually a market for ice cream. We also found that most people eat ice-cream on impulse (Item No. 3 of Appendix), this shows that if Venetian Ices Ltd want to sell ice-cream to the vast majority of people they must appeal to their impulsive side. To appeal to the consumer’s impulsive side Venetian Ices Ltd must keep in mind two aspects of the marketing mix; promotion and place. I think that promotion is particularly important to attract impulse buying consumers as it involves the advertising of products and can make buying ice-cream more tempting if there is a promotional offer, e.g. 2 tubs for the price of 1. Also the place element comes into play in conjunction with the promotion aspect as there is no point having promotional advertising and packaging aimed at impulsive buyers if it is not in the right place for them to see it. A good example of this being used to a good affect is the ice-cream company Ben and Jerry’s and their association with UCI cinemas (Item No. 17 of Appendix). As Ben and Jerry’s have an ice-cream retail counter in most UCI cinemas when consumers go to the cinema they often eat ice-cream (Item No. 9 of the Appendix) and as they can see the ice-cream counter, with appealing promotions, they will be likely to buy Ben and Jerry’s ice-cream on impulse.
As the marketing director, Stephanie Wallace, is keen to introduce franchising into Venetian Ices Ltd I researched into the affect franchising has had on companies in the ice-cream market. A good example of a company that introduced franchising into their company is Baskin-Robbins. Baskin-Robbins was one of the first companies to introduce licensing operations of ice-cream stores (as early as 1948) and as they put it ‘giving birth to the idea of franchising in the ice-cream industry’ (Item 18. of Appendix). Franchising has proved massively successful to their company and allowed them to expand their chain of stores firstly throughout America, having a store in each state, to the world’s largest chain of ice cream specialty stores. There are also many franchising opportunities in various countries in Europe, which if Venetian Ices Ltd wanted to, could be exploit. An example of one such opportunity is the lack of different ice cream franchises in Spain. Currently the only company to have exploited this market is Häagen-Dazs although Unilever are also planning to infiltrate this market with the Ben and Jerry’s franchise of ice-cream parlours (Item 11. of Appendix).
An idea currently being undertaken by Häagen-Dazs is that of not labelling their tubs of ice-cream with the flavour so that the consumers have no idea which flavour they are buying, the idea behind this is that consumers will get a better taste sensation if they cannot anticipate the flavour of the ice-cream (Item No. 14 of Appendix). As my market research has shown that most individual consumers prefer specific flavour of ice cream (Item no. 5 of Appendix) this may not be very successful although the progress of this should be monitored in case the idea does produce some good results. As can be seen from items No. 4 and 6 of the Appendix consumers are attracted to brand name ice cream more than any other is. With consumer tastes leaning towards specific brand names and their images it may be a good idea for Venetian Ices Ltd to start to establish its own brand name and image. If Venetian Ices Ltd wanted to start building their own image they will want to take into consideration the image they want. As can be seen from item No. 10 of the Appendix there are several different images that could be assumed, for example the large big brand name of Häagen-Dazs has tried to give its ice-cream the image of being very sexy and sensual, whereas the smaller more local firm of Beechdean Dairies try to rely on the quality of their products and appeal by word of mouth and advertising at special events as opposed to the Häagen-Dazs approach of mass media advertising.
A fairly new marketing strategy being implemented by Walls is that of a ‘brand experience’ store (Item No. 13 of Appendix). The idea is to give brands that are normally sold packaged in supermarkets and small retail outlets, like newsagents and off-licences, a fresher appeal by preparing them there and then in front of the consumer for take-away as a take-away pizzeria would prepare pizzas fresh for customers. This ides could give companies like Venetian Ices Ltd an image of a more personal relationship with its consumers.
The type of advertising is very important in the marketing of ice cream products. As already mentioned smaller companies, like Beechdean, try to advertise by attending special events and relying on the word of mouth of their customers whilst big name brands use media advertisements and sponsorship deals. The main difference between these different approaches is money. Advertising at local events is fairly cheap as opposed to the millions spent on advertising by big name brands. But even when advertising is used it must be appealing in the right way. As can be seen in item No. 16 of the Appendix there is a massive difference in advertising spending between Ben and Jerry’s and Häagen-Dazs (nearly £3 million) but there is only a 0.1% difference in their respective luxury market shares. This shows that Häagen-Dazs has either spent too much money on the wrong type of advertisements or on the wrong methods of advertisement. So advertising, especially in the case of Häagen-Dazs, can prove to be very worthwhile but at a price (Item No. 10 of Appendix). When Venetian Ices Ltd consider their marketing options if an advertising strategy is decided on the method of advertising and advertisement content must be considered very carefully or they could lose a lot of money and not get much benefit.
There are several methods advertisement available and many new ones not yet tried out. For example SMS text messaging has been used by companies such as McDonalds, in their ‘text to win’ competition, and Häagen-Dazs, using SMS text messaging to gain market research from consumers about ‘me time’ (Item No. 15 of Appendix). Another method that as of yet has not been properly tried out is WAP (Wireless Application Protocol), mainly because it has not been deemed to provide a decent form of advertising media but as Items No. 12 and 15 of the Appendix show, the true potential of WAP has not been seen yet as many consumers do not yet have the opportunity to receive all the benefits of WAP. Although with further advances in technology, for example GPRS providing better WAP connections, and many of the advanced more expensive mobile devices becoming the standard and allowing most consumers to experience all of what WAP has to offer, WAP may become one of the best advertising platforms available and as such Venetian Ices Ltd should keep an eye on the development of this technology and take advantage of it in the future if the opportunity occurs.
As you can see there are many different marketing possibilities open to Venetian Ices Ltd all that would affect the company in different ways. In the following sections I will conclude the advantages and disadvantages of some of these opportunities and recommend which ones I think would best suit Venetian Ices Ltd and also the best way to implement these strategies.
The field research for this report has been conducted between November 2001 and March 2002, the desk research was collected from sources published between 2000 and 2002, so the research is accurate and up to date. The sources I used were fair and for the most part offered reliable, unbiased opinions and facts. Due to the limited capabilities of my market research group we were only able to interview a relatively small sample (about 60 people), who were all from our city, Preston. This made the results and findings from our questionnaire quite limited as they only represented peoples’ opinions from a narrow geographical area. Further research taking in a wider geographic area would be necessary in order to give a more balanced set of results, as ours may be subject to local preferences that may not be reflected in a larger sample.
I have made several conclusions from this research and targeted several possible marketing opportunities that I feel are available to Venetian Ices Ltd. If the client intends to seize any of these opportunities they will need to conduct further research into them prior to any major investment.
From the primary research results I found a significant amount of the purchases are made on impulse. This I feel should be investigated further by research to establish that this pattern follows through, if it does then opportunities to enable customers to buy in this way need to be found and researched.
Franchising, such as Ben and Jerry’s association with the UCI cinema chain is an established method of increasing outlets fairly easily, and these opportunities should be looked into.
Other franchising opportunities within the U.K. should also be sought and if, they prove successful, possibly extending the idea to other countries in Europe. This would be appropriate, as foreign markets for ice cream could become very profitable.
Venetian Ices Ltd will have to be careful that they do not become too large, too quickly and suffer from diseconomies of scale because this may well conflict with Venetian Ices Ltd current image of quality and being close to their customers. They may lose or discredit this image if they are seen to become a large uncaring company.
Image is very important in the ice cream industry, (item 10. of Appendix for evidence), so research into the different types of images available to Venetian Ices Ltd would be appropriate. There are several advantages and disadvantages to the types of images, so it is important that Venetian Ices Ltd choose the most appropriate one. If Venetian Ices Ltd decide to adopt an image of being close to their customers, to emphasize the quality of their product they will probably gain a lot of local customers. This image may limit their growth ability, as it is impossible for a large national or multinational company to interact with all its customers on a personal level, as a small local firm can do. On the other hand a large brand name company, like Häagen-Dazs, can portray an image of their product as being a luxury product but, they may not be able to sell ice cream on a regular basis as it is deemed too luxurious by most and will loose out to cheaper brands such as supermarket own labels.
Research should be conducted into advertising strategies and the many methods of advertising. Advertising is also linked very closely with the company’s image and so the image must be correct in the first place or a lot of money can be wasted on advertising to the wrong target market. It is crucial that Venetian Ices Ltd undertakes the right form of advertising, (see item 16 of Appendix for figures), so that the customers it is aiming for get the message and retain the brand name when purchasing ice cream. When advertising is done successfully it can prove very worthwhile, as can be seen in the case of Ben and Jerry’s in item 16 of the Appendix.
I think that it would be beneficial to the company to carry out further research into franchising, such as investigating the success of franchising in the U.K. and abroad, as Venetian Ices Ltd are already considering this possibility the company will want as much information as possible before venturing into it, and may also discover a better method of introducing the franchising idea, for example introducing franchises in European countries first then coming to the U.K. may be more profitable than starting in the U.K. and expanding abroad. Other possible marketing opportunities that I have mentioned, particularly the new ideas, such as the Wall’s ‘brand experience’ store should also be considered and monitored to see if any of them do prove to be successful.
I think that firstly Venetian Ices Ltd must carry out the research I have suggested in the conclusions section. With this extra information the company should be able to determine the image that would best suit it. The image of the company must be decided first as it is critical in the marketing of the company and once the image is decided Venetian Ices Ltd will be in a better position to consider the next steps for the company to take.
Once the image of the company is decided the types of advertising open to the firm can be considered. I recommend the form of advertising that Venetian Ices Ltd consider should be researched very thoroughly as advertising is very costly and can prove to be quite unsuccessful if an inappropriate type is chosen.
I recommend that Venetian Ices Ltd should concentrate on the franchising opportunities available in the U.K. and possibly try and establish a franchise tied in with another business, like the Ben and Jerry’s and UCI agreement. If Venetian Ices Ltd managed to establish an agreement like this, for example with Warner Bros Cinemas, they could have an outlet in every Warner Bros Cinema and as such would need to do very little to attract people to the outlet as people who are visiting the cinema would be captive customers if they wished to purchase ice cream. This would save advertising money and the money could then be spent on improving products and gaining the company a better reputation.
Franchising opportunities abroad should also be considered very carefully, especially in countries like Spain where there are not many ice cream franchises. Countries such as Spain are perfect for selling ice cream as the weather is very warm and stays quite warm for most of the year as well as places like Spain being popular destinations for tourists there would also be a lot of custom as people on holiday tend to ‘splash out’ more on luxuries like ice cream.
Finally I recommend that Venetian Ices Ltd constantly monitor the progress of new technologies that I have mentioned, for example WAP to advertise, and new marketing strategies, such as Walls’ ‘brand experience’ shop, as if these ideas and technologies prove to be successful Venetian Ices Ltd will want to be in a position to exploit them to the full.
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