Ben & Jerry's Marketing Strategy
Ben & Jerry’s is one of the leading brands within the frozen dessert market due to a variety of factors. This report will look at those factors exploring the concepts behind each one to justify its position within the market.
The company was founded in 1978, Vermont, USA where Ben Cohen and Jerry Greenfield opened their first Scoop Shop in a renovated gas station. Since then over 300 more have opened within the USA, and the company has branched out into the international market with Scoop Shops in 34 different countries including the UK, Australia and Singapore. In 2000 Unilever, the world’s largest ice cream producer and current market leader bought Ben & Jerry’s for just over £169m. As part of the takeover deal it was agreed that Ben Cohen and Jerry Greenfield, would still manage it brands integrity and watch over its social mission.
One of the main factors of the brands success is placed within its marketing strategy. Ben & Jerry’s marketing mix provides a range of controllable aspects in which used to meet with the target audience.
The main element of this marketing mix lies within the product itself, a luxurious treat with a variety of exciting and unique flavours, along with the brands social and economic mission. Ben & Jerry’s are very proud to commit to a wide selection of social, environmental and economic projects on a local, national and international scale; these are all advertised on the company website as well as gaining coverage in many news articles within the area the project is involved with. The company website also includes three mission statements; the product mission, the social mission and the economic mission, each providing the basis of what the company is founded upon. All of the things concerning these mission statements are all included as part of the Ben & Jerry’s product, which in essence means that by purchasing the ice-cream product you support the social and economic mission of the brand.
Pricing is very important when marketing a product, as this is the only element within the marketing mix which generates an income as the other factors are a variable cost for the company. Competition and company objectives are considered when planning the pricing of a product. Ben & Jerry’s choose to use a premium pricing strategy, this means that the products are priced at the higher end of the market, however this does not deter consumers as the premium price is supported by a high quality product and brand image. However recently Ben & Jerry’s have increased the price to an average of £4.18 and according to Harry Wallop, Consumer Affairs Editor for the Telegraph, it is now ‘above the "psychologically important" £4 barrier’ this is due to the current inflation in the food market.
Ben & Jerry’s marketing mix also uses place as a key factor in its success. It is primarily based in the US where it originated, but its international market is quickly expanding, most recently with the reopening of stores in Israel. Products are currently available from a variety of outlets, mainly within supermarkets and convenience stores. There are also individual Scoop Shops open, and many Scoop Stations open within shopping centres and cinemas. According to the Mintel report on UK Cinemas, June 2010, Odeon the largest cinema chain within the UK has over 100 cinemas and Ben & Jerry’s Scoop Stations in the majority of its properties. Cineworld, another leading chain also offers Ben & Jerry’s Scoop Stations within many of their cinemas, adding 13 additional outlets during 2009. Although not included in the Mintel report was Vue cinemas, which according to their website boasts a substantial amount of Ben & Jerry’s Scoop Stations in their cinemas across the UK. Another Mintel report on UK On-board Catering, May 2010, shows that Ben & Jerry’s ice-cream is available within the Food Court on all P&O Ferries. This growth within the brand means that the products are more widely available and are now reaching a larger target market.
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The last aspect of the marketing mix is promotion, this is used to communicate with the public and inform them of the product. It is also used to influence the target market into purchasing their product, by promoting it as being the best. Advertising is one of the key factors when marketing a product; however Ben & Jerry’s initially aimed to stay away from the conventional advertising route and relied heavily on word of mouth as they believed that the money they would spend on advertising would be better used if given to charities. Eventually after expanding the business to more countries, including the UK, Ben & Jerry’s decided to begin advertising campaigns to promote their products. In 1998 Claire Beale, the editor of Campaign magazine, reported that Ben & Jerry’s were to launch their first major UK advertising campaign ‘Ben & Jerry's is putting £500,000 behind a summer campaign in London and the South East, which will include press and 48-sheet posters as well as ads on London Underground stations.’ Since this initial advertising campaign, Unilever bought Ben & Jerry’s which allowed the brand to have a greater presence in the super-premium sector. The takeover also meant promotion would become a more important part of the brands marketing mix, and the introduction of a cinema campaign began. This campaign is well suited to the brand as it currently has outlets within many of the cinemas within the UK, making the product accessible to the target market. Ben & Jerry’s campaigns usually have a humorous aspect and more often than not include the iconic hand-drawn cows and pastures by Woody Jackson which are associated with the brand. Ben & Jerry’s occasionally introduce offers such as ‘buy one get one free’ or money-off promotions usually within larger supermarket chains. These are cleverly devised within the marketing mix and only last for a limited amount of time, they increase consumer demand and are sometimes used when a new flavour is launched. Ben & Jerry’s sometimes create limited-edition campaigns when a specific event is taking place, in the US ‘Butter Pecan’ was renamed ‘Yes, Pecan!’ to mark Barack Obama’s inauguration as President of the USA, this was due to his campaigns uniting theme being ‘Yes, we can!’ Not only was the flavour renamed, Ben & Jerry's donated proceeds from the sales of the flavour within January to the Common Cause Education Fund. See appendix 1a for an image of the campaign.
All of these aspects together have been used specifically to create this successful marketing mix, allowing the brand to be one of the market leaders, especially in the UK. Passport GMID confirms this, with Table One showing the brands shares within the UK ‘take-home’ sector, in which it has remained the market leader since 2007.
Ben & Jerry’s is not successful just because of its marketing mix, other factors such as its self-awareness as a brand and research into its external macro-environment has allowed the brand to thrive. A PEST analysis allows the brand to look at which external factors affect them especially when considering international expansion; the first aspect of this analysis is the political factors. Ben & Jerry’s were fully aware of marketing regulations and trade agreements, when choosing to expand to different countries. These issues were carefully considered as part of this analysis, along with economical factors. Unilever put strategies in place to promote and protect the brand throughout various economical conditions in the countries in which it operates, these depend on the national interest rate, inflation, as well as the economic growth rate of the country. As the UK is currently experiencing a recession, money-off price promotions have been in place in various outlets to encourage consumer buying. Social and technological factors are also taken into consideration during the PEST analysis. Ben & Jerry’s look at the attitudes to similar products and see how their product would fit in with the culture of a country; they also look at technological advances as these are very important to stay ahead in such a competitive market. The recent development of hydro-carbon freezers is not only an advance in technology but it fits well with the brands ethos, as these new freezers do not contribute to global warming.
A SWOT analysis allows the brand to be self-aware, by realising its strengths and weakness, which provide an insight into its opportunities and threats. The main strengths of Ben & Jerry’s are that it produces uniquely flavoured ice-cream and frozen yoghurts under eye-catching names such as ‘Chunky Monkey’ and ‘Phish Food’, it also has good environmental recognition due to funding a variety of projects concerning the environment. Other strengths of the brand are the involvement in social issues such as animal welfare and fair-trade, it currently uses fair-trade chocolate, vanilla and coffee within its products and the company website states that ‘by 2013, we will have fully switched to eligible fair-trade ingredients for our products’. The takeover by Unilever has also added to the strength of the brand as it now has more dominance within the market. Weaknesses within the brand such as lack of professionalism in management and lack of financial support to fully expand internationally were solved when Unilever took over in 2000, although this created a new weakness, which was the potential loss of the brands original ethics. As part of the takeover agreement the co-founders were able to monitor the social mission, however according to ‘the body beautiful: mixing money and morals’ an article from 2006 in The Economist ‘Ben & Jerry's latest social audit says a survey of employees found that only 45% thought that top management was taking the company's social mission seriously’. Another article, Culture Change from the January/February 2003 Issue of Mother Jones states ‘Unilever no longer gives 7.5 percent of Ben & Jerry's pretax profits to charity.’ Despite these weaknesses, there are many opportunities for Ben & Jerry’s, with today’s health conscious society, the introduction of more frozen yoghurt and low-fat ice-cream would allow the brand to expand into a new sector of the market. According to Euromonitor International, ‘Ice cream's performance was underpinned by warm weather conditions and robust demand from wealthier consumers’, this means they will able to afford premium ice-cream. The article also states ‘in 2009 Iran, Israel and Saudi Arabia, accounted for around 50% of total ice cream retail value sales in the Middle East and Africa region’ this is a great opportunity for Ben & Jerry’s to expand their international market, with current operations launching in Israel, more could be opened within the Middle East. However being self-aware as a brand not only looks at opportunities but also at threats, the most recent of which has been the current economic downturn, which means consumers have less disposable income to spend on premium products. Although the recession threatens the brands profits, the main threat comes from major competitors such as Nestle and Haagen-Dazs.
According to the Passport GMID table ‘Take-home Ice Cream Brand Shares 2006-2009’ used earlier, Haagen-Dazs is Ben & Jerry’s main competitor within the super-premium sector. According to the 2002 UK take-home ice cream report on Mintel, Haagen-Dazs ‘effectively created the super-premium ice cream sector in the UK’ and has ‘pioneered this sector in commercial terms’ and built up its brand with advertisements featuring ‘scantily-clad young people’ whereas Ben & Jerry’s had a ‘very different, quirky image’ with unusual flavours which were vaguely named after ‘counter-cultural references’. Haagen-Dazs focus a lot of its marketing mix within the promotional aspect, using a lot of advertisements to entice consumers. These adverts initially used a lot of sexual imagery (see appendix 2a) to tempt the market, but are now focused on capturing the essence of luxury and pleasure (see appendix 2b). Haagen-Dazs realised there was a potential market within healthier frozen treats and introduce a range of frozen yoghurts, however according to the earlier Mintel report in 2002 on UK take-home ice cream ‘Haagen-Dazs was a high-profile entrant to the frozen yoghurt sector, and it seems to have made a lower-profile exit’ proving its range wasn’t popular with consumers. This is where Ben & Jerry’s succeeded, even though only a few frozen yoghurt flavours have been introduced, today’s health conscious consumers seem to be welcoming these low-fat goodies as they do not compromise on taste and indulgence.
Ben & Jerry’s have manipulated many marketing strategies to become successful worldwide. Especially within the promotional mix, the concentration on their social mission, backed by the co-founders ethical beliefs has proven to be profitable beyond belief. Their ability to supply a top quality product which consumers feel good about buying allows them to stay ahead of the competition. Ben & Jerry’s have not only adapted the marketing and promotional mix to suit their style but the AIDA model also reflects the way in which the brand is run. The way in which the product is packaged, with bright colours and playful images along with the uniquely named flavours, catches the attention of consumers and draws them into the product. The interest is then kept and desire is created by reflecting the benefits it has to offer, such as its naturally sourced ingredients and the social aspect of the company, this appeals to the consumers wants. Leading to the final aspect of the model, where the consumer has taken into account all of the marketing elements and decides to take action, by purchasing the product.
This report has focused on the main factors in the success of Ben & Jerry’s, through the use and adaptation of a variety of marketing theories. The research has shown how consumers relate to not only the luxury of a product but the message behind the brand, which has proven to be an effective mix for Ben & Jerry’s. The research also suggests that consumer interaction has played an important role when launching new flavours and ethical campaigns, which allows them to be one of the market leaders in competition with Haagen-Dazs.
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