Executive summary of Gourmet: Introduction: Gourmet bakers and sweets is the top food retail chain of Lahore. Lahore is the second largest city of Pakistan fabled for its customer aliment and amorousness for eating. Gourmet is the number one brand in the market of bakers and sweets due to its quality and valuable services. Before 1984, Mr. Nawaz Chattha was the employee of the Shezan bakers at the post of manager. While he was doing his job, he decided to start his own business separately because he was proficient dealer, a technical supporter and maintained check and balance in every branch. Mr. Nawaz Chattha started his business from one out let in Muslim Town with bakers in 1987. After seeing the profitable result he decided to introduce new product like sweets, milk, and ice-cream and gourmet cola. In continuous success of gourmet in providing quality service and products for the health and happiness of all family, Gourmet also started a family restaurant. Since the emergence of Gourmet bakers, it has shown explosive annual growth of more than 25% in its business. It has 1700 employees working in its all departments. It has around 95 branches and will enhance its coverage to One hundred branches making it The Largest Bakers and Confectionaries of the city as well as the country. Company Name- Gourmet Bakers & Sweets (PVT) limited. Gourmet is a private limited liability company and the information regarding its share is as follows: Registered office address: 9/D Faisal Town Lahore.
Transcript
Executive summary of Gourmet:
Introduction:
Gourmet bakers and sweets is the top food retail chain of Lahore. Lahore is the second largest city of Pakistan fabled for its customer aliment and amorousness for eating. Gourmet is the number one brand in the market of bakers and sweets due to its quality and valuable services. Before 1984, Mr. Nawaz Chattha was the employee of the Shezan bakers at the post of manager. While he was doing his job, he decided to start his own business separately because he was proficient dealer, a technical supporter and maintained check and balance in every branch. Mr. Nawaz Chattha started his business from one out let in Muslim Town with bakers in 1987. After seeing the profitable result he decided to introduce new product like sweets, milk, and ice-cream and gourmet cola.
In continuous success of gourmet in providing quality service and products for the health and happiness of all family, Gourmet also started a family restaurant.
Since the emergence of Gourmet bakers, it has shown explosive annual growth of more than 25% in its business. It has 1700 employees working in its all departments. It has around 95 branches and will enhance its coverage to One hundred branches making it The Largest Bakers and Confectionaries of the city as well as the country.
Company Name- Gourmet Bakers & Sweets (PVT) limited.
Gourmet is a private limited liability company and the information regarding its share is as follows:
Registered office address: 9/D Faisal Town Lahore.
Authorized Capital: 20,000,000.
Paid up Capital: 50,000.
CEO name: Ch. Muhammad Nawaz Chattha.
CEO Address: 9/D Faisal Town Lahore.
Incorporation Date: January 9, 1996.
Authorized Capital Share: 200,000.
Paid up Share Capital: 500
Authorized PER Value: 100
Paid up PER Value: 100
Vision:
“We are a bakery company with one goal in mind to meet the needs of our customers we focus on our customers as our clients.”
Mission Statement:
“To provide delicious, wholesome baked foods without sacrificing health and well-being.”
Company Objectives:
Objectives are the guidelines which direct toward the chosen destiny. The objectives of the Gourmet are marketing objectives which are as under:
1. To build profitable customer relationship by delivering superior value.
2. To provide such products those can increase targeted markets.
3. To become a leader in the bakery and confectionary industry.
4. To provide the quality products to the target market.
Gourmet bread and other bakery Products come under star as they have a high relative market share and high growth rate. They are in maturity stage of its product life cycle.
Cash Cow:
Gourmet Cola, Gourmet Water and Dairy Products are Cash cow products for Gourmet as they have a low market Growth rate and a high relative market share.
Question Mark:
Gourmet new products like Dry Milk and the same for Tea as well come under Question mark. Or any other new product that Gourmet offers or is planning to offer will come in question mark category.
Dogs:
Gourmet Roll and Samosa Patti have a low market Growth rate and a low relative market share therefore, these products come under Dogs and therefore Gourmet has discontinued the production of these products.
Product Lines of Gourmet:
Some of the major product lines are:
Sweets:
It has a huge product length in sweets like Gulab Jaaman, Barfi, Laddoo, Cham Cham, Halwas, Rassgula, Patisa, Jalaibee, Amarti, Ras malai and others.
It includes Bread, Buns, Rusk’s, Cookies, Biscuits, Cakes, Pastries, Patties, Pizzas, Nimko, Vegetables rolls, Chicken rolls, Hot dogs, Sandwiches.
Dairy Products
It includes milk and ice cream products.
Beverages
It includes Gourmet Cola, Gourmet ice-cream soda, Apple Sidra and Gourmet Lemonade etc.
Filtered Water
It also offers gourmet water.
Marketing Strategy and Marketing mix:
Customer driven marketing strategy:
Market Segmentation:
Consumers can be grouped and served in various ways based on following segmentation variables:
Geographic Segmentation:
Gourmet is currently in function in only one city “Lahore”. It divides Lahore in several divisions according to its customers or potential customer’s availability.
Demographic Segmentation:
It caters all kind of different segments in demographic segmentation within Lahore.
Gourmet caters every social class, especially middle class.
Behavioral Segmentation:
Gourmet tries to cater different occasion in Lahore like Eid, Ramadan, Christmas, Valentine’s Day and Independence Day. It also believes in providing benefits to customers, their main target is to capture maximum market share by providing easy access to its customers in every area.
Market Targeting:
Gourmet does the differentiated target segmentation. Gourmet does not impose an income barrier to its client and caters all kind of people with different incomes. Its main aim is to target all segments of customers with in Lahore hence covering a huge audience for its Target market. It caters from upper class to lower class.
Market Differentiation and Positioning:
Gourmet differentiates the market offering to create a superior customer value. Gourmet position itself as a medium store, as its quality is good and prices are less as compared to the market. That’s why the Customers of Gourmet are increasing day by day. It believes in getting negligible profits margin and getting bulk of sales as the already have a huge customer equity. It also position it self in market by increasing its presence by having around 95 functioning branches (the largest for any bakery in Pakistan). It also differentiates it products by providing ultimate services on its outlets like cleanliness, user friendly customer assistants and healthy and hygienic environment.
Marketing Mix of Gourmet:
Product:
Products of Gourmet show attributes like quality, features, style and design. Its quality is always good and innovative having differentiated features. Gourmet designs begins with the deep understanding of customer needs when Gourmet develops its new product it is always based on customer perception and needs. It more focuses on benefits for customers not profits.
Price:
Gourmet earns low and negligible profit that’s why its prices are always less than market. It keeps low prices according to market penetration pricing strategy in order to attract a large
number of buyers and a large market share. Gourmet uses value based pricing when setting prices which is based on the perception of value rather than on the sellers cost.
Place:
Being accessible to customers increases the value for customers. Gourmet is a market leader as “Gourmet Foods”. Its growing size of all branches has become more easily accessible and convenient to customers. It has around 95 branches in Lahore.
Promotion:
Gourmet does its promotion only in its stores. Whenever it introduces its new branch it gives 25% discount which is for promotion and other promotion mix tools used as sales promotion which is short term incentive to encourage the purchase of a product. Its public relations as they are very kind and helpful to their employees. Recently it has started promoting its products on local TV channel “City 42”.
Managing the Marketing Efforts:
Marketing Analysis (S.W.O.T. analysis) of Gourmet:
Strengths:
Gourmet is one of the strongest brand names in Lahore. Strength of Gourmet bakers is a quality product with reasonable price They follow their strategies in accordance with customers mind. Gourmet is a clear market leader. It is easily accessible almost everywhere in the city. They are following concentration on customer’s needs and mind along with suitable
price. Gourmet does not give franchise or partnership to anyone. They are operating all the
branches by themselves. There is a one more affirmative from gourmet bakers is its generic color. Strong distribution channel High market share Customer Retention
Weaknesses:
Gourmet is not focusing properly on promotion tools such as advertisements. Proper Parking is not available on each and every branch.
Opportunities:
Many cities to capture
One of the most important opportunities is that Gourmet can increase their target market by capturing other cities which consist of the potential customers.
Brand Worth:
Gourmet is the well recognized brand nation wide which means the worth of the brand is good in the mind of the customers. Because of the brand worth Gourmet can come up with the different market of bakery products.
New market to explore nation wide and internationally:
It is the great opportunity for Gourmet to expand their business and market by exploring the new markets nation wide and internationally.
Home Delivery
E-shopping
Threats:
Change in the consumer preference:
Changing of consumer preferences is a major threat of any organization. As if we talk about Gourmet sweet now people prefer cakes over sweets which have become a major threat.
Lack of new technology
No innovative product.
Marketing Planning:
Gourmet follows the company strategies which are inline with the company’s goals and recommendations. It position it self as a leader in bakery products in Lahore. Before making any plan it considers its impact on its current customers, environment and competitors’ response. It also considers current threats with in the market like loosing market sale, brand image etc before making any plans. Gourmet focuses on all the available opportunities in market related to its business like launch on gourmet cola, milk ice-cream. Once it decides its main objectives and issues then it steps forwards to the action plan which consists of detailed schedule of the entire task and their budgets. Once Gourmet finalizes its plan it implements its plan and keeps on checking its performance to control its out come.
Marketing implementation:
After having a detailed discussion and planning gourmet comes towards the implementation phase of their marketing strategies. In implementation the company’s formal organizational structure plays and important role. Managers not only focus on short term profits but they also consider long run market building objectives. On the other hand company also considers its culture in implementing a plan.
Marketing Control:
Gourmet focuses on two types of marketing controls operational and Strategic. In operational controls it checks that all the operations are in line with the current marketing strategies. Where as strategic controls focuses on long run and check the long run performance of the company. It also have an internal audit department which keeps a strict checks not only on its financial performance but also on its procedures and controls which effect in every day performance.
The Marketing Environment:
The Company’s Macro Environment:
P.E.S.T. Analysis
Political – meeting all the policies and working under the political stabilities Economical – focusing the income levels of targeted customers Social – the social class we have targeted are: Technological– accepting and using the innovations in technology for production Demography – gourmet deals with a variety of demography. It caters all kind of age
groups starting from children to adults. Culture – Gourmet keeps it self in line with the local culture of Lahore. It provides
different products according to local festivals events and Religious days.
Market Intermediaries o Gourmet does not have any major market intermediaries as it produces and sale it
products it self. It does contact market intermediaries for supply of raw materials, and products like Coca cola, Jams, Ketchup, and Juices etc.
Competitors
If you look at Gourmet Foods, it is a clear market leader but still Gourmet has competitors. Nirala and Shezan bakers are the competitors of Gourmet as these are the only few stores who are catering the same market as gourmet is going. They also have well established brand name and image. They are fully equipped with latest technology and manufacturing plants, but these competitors are only targeting small segments of the market. They are not upgrading themselves that is why in the race of capturing market they are staying behind the market leader “Gourmet”.
Suppliers o Local dairy Farms.o Whole sellers.o Market intermediaries.
Customers
Customers of Gourmet are End user of the product mostly. They buy to consume the final products and services.
Customer Relationship Management
Marketing Objectives:
Goals and targets have to be monitored and met, competitor strategies analyzed, anticipated and exceeded. Through effective use of market and marketing research an organization should be able to identify the needs and wants of the customer and try to delivers benefits that will enhance or add to the customers’ lifestyle.
Marketing Strategies:
Gourmet bakers adopted customer’s oriented marketing strategies to attract customers as much as it can. Gourmet bakers follow differentiation strategy such as strategy emphasizes the product that is unique in the industry provides distinct advantages to the bakers.
One of the prominent marketing strategy of gourmet bakers is focusing on special classes of customers like gourmet bakers is focusing on upper class, middle class as well as the lower class.
Marketing Channels and Supply Chain Management:
The gourmet sell there goods directly to the final user. Gourmet channel decisions directly effect other marketing decisions. Due to using on marketing channels it reduces the cost. Gourmet sales force and communication decisions depend upon how much persuasion, training, motivation and support its channel partner needs.
Monopolistic Competition:
Gourmet faces Monopolistic Competition in the market. There are many buyers and sellers who trade over a range of prices rather than single market price. Every Seller tries to differentiate its product to gain competitive advantage and to justify its price difference.
Budgeting:
Budgeting plays an important role in any plan. If a plan is not financially feasible there is no benefit to be gained from all other procedures.
In Budgeting process Gourmet spends 40% of its target budget on the refurbishing of the bakery. 55% of the budget is allocated in the manufacturing of its products. 5 % of the budget is allocated to promotional activities. Gourmet focuses on an affordable budgeting method.
Control:
Controls are very crucial for the success of any project. Gourmet implements high quality controls through its total quality management department. Gourmet uses team based approach for new projects by using these approach tighter controls will be implemented and performance can be monitored on every step.
Critical Issues:
Political instability and economic conditions of the country are immensely affecting the business sector in the country.
Threat of Bomb attacks in any crowded place due to Terrorism also imposes an effect which leads to decreasing sales of the business as people now think before coming out of
their homes. Furthermore, terrorist activities are weakening the Pakistan economy day by day. Such kind of issues may impose a bad effect on the Gourmet business in the future
Recommendations:
Gourmet must use new technology like Information system to centralize its Database as its service and data requirement will greatly enhance it will need processes like Data ware housing and data mining.
It can also improve its security measures by implementing security cameras Up to date scanners radio frequency bar code readers (RFID’s) will improve its
departmental services efficiently and effectively. Gourmet should also work for enhancing the parking area. Gourmet should also do work for innovation in products and for the atmosphere of its
stores. Gourmet Bakers have their branches only in Lahore which is the drawback of their
marketing strategies. The company should also open its outlets in other major cities and spend capital on advertising the company in those cities.
The company is not planning for the loyalty of its customers. They should give discounts to its regular customers in this way the customer sincerity with the company will grow.
Gourmet has not advertised themselves through media; they should have adopted some other sources of advertisement such as banners, newspapers, TV channels to cater the market. Recently it has started its promotion on “City 42”.
Gourmet Bakers launching new product as Gourmet Chocolate
Posted by admin on June 29, 2012 in Marketing 1 comment
Executive summary
Introduction of the company
Gourmet bakers and sweets is the top food retail chain of Lahore. Lahore is the second largest city of Pakistan fabled for its customer aliment and amorousness for eating. Gourmet is the number one brand in the market of bakers and sweets due to its quality and valuable services. Before 1984, Mr. Nawaz Chattha was the employee of the Shezan bakers at the post of manager. While he was doing his job, he decided to start his own business separately because he was proficient dealer, a technical supporter and maintained check and balance in every branch. Mr. Nawaz Chattha started his business from one out let in Muslim Town with bakers in 1987. After seeing the profitable result he decided to introduce new product like sweets, milk, and ice-cream and gourmet cola.
In continuous success of gourmet in providing quality service and products for the health and happiness of all family, Gourmet also started a family restaurant.
Since the emergence of Gourmet bakers, it has shown explosive annual growth of more than 25% in its business. It has 1700 employees working in its all departments. It has around 95 branches and will enhance its coverage to One hundred branches making it The Largest Bakers and Confectionaries of the city as well as the country.
Company Name- Gourmet Bakers & Sweets (PVT) limited.
Gourmet is a private limited liability company and the information regarding its share is as follows:
Registered office address: 9/D Faisal Town Lahore.
Authorized Capital: 20,000,000.
Paid up Capital: 50,000.
CEO name: Ch. Muhammad Nawaz Chattha.
CEO Address: 9/D Faisal Town Lahore.
Incorporation Date: January 9, 1996.
Authorized Capital Share: 200,000.
Paid up Share Capital: 500
Authorized PER Value: 100
Paid up PER Value: 100
Gourmet Vision
“We are a bakery company with one goal in mind to meet the needs of our customers we focus on our customers as our clients.”
Gourmet Mission Statement
“To provide delicious, wholesome baked foods without sacrificing health and well-being.”
Company Objectives
Objectives are the guidelines which direct toward the chosen destiny. The objectives of the Gourmet are marketing objectives which are as under:
To build profitable customer relationship by delivering superior value. To provide such products those can increase targeted markets. To become a leader in the bakery and confectionary industry. To provide the quality products to the target market.
Introduction to the product
Throughout history, chocolate has always had the connotation of being joyful,comforting and special as a symbol of diverse human emotions and has always been a part of our lives
We have introduced our product after a complete research of market. We find out that people are willing to buy our product that we are going to launch in a sophisticated packaging with a reasonable price. Most of the people have responded in a much better way about our new product.
Now Gourmet bakers are introducing a new product into the market which is chocolates and candies. It has many competitive advantages that will ensure profitability and its acceptance in the society. This product will be launched in Lahore into the consumer market.
Positioning in the market
Positioning is how the company is seen through the eyes of its consumers by emphasizing on our beneficial differences in our customers minds. The position of the product is the set of impressions, feelings, and perceptions that customers have for the product.
Value Proposition
Gourmet chocolate will be positioned in the market as a Smooth Milk Chocolate. We are providing a set of benefits nutritious and delicious.
Consumer need of the product is tasty, delicious, healthy and sweet chocolate.
In sweets, gourmet deal in all types of traditional products like burfi, chum chum, gulam jaman, rassgula, patisa, jalebee, amarti, ladoo and malai.
Portfolio Analysis (B.C.G. Matrix)
Star: Gourmet bread and other bakery Products come under star as they have a high relative market share and high growth rate. They are in maturity stage of its product life cycle.
Cash Cow: Gourmet Cola, Gourmet Water and milk are Cash cow products for Gourmet as they have a low market Growth rate and a high relative market share.
Question Mark: Gourmet new products and project come under Question mark as there is uncertainty in there response therefore Gourmet chocolate and candy come under question Mark as well as they have a high market Growth rate but a lesser relative market share.
Dogs: Gourmet Roll and Samosa Patti have a low market Growth rate and a low relative market share there for these products come under Dogs and therefore Gourmet has discontinued the production of these products.
The Product/Market Expansion Grid
Gourmet will use Product development process to expand its services into existing market; through this process Gourmet will introduce its new product into the market
Marketing Objectives And Strategies
Marketing Objectives
Being the gourmet holds the most market share in the bakers now a days , the perceived quality and services of the company will help to ensure a better than average chance at a successful introduction of a new product.
Gourmet is very famous for introducing the new products to spark long terms sales. It’s the specialty of the gourmet bakers to introduce a new product with recent trends; it’s also reducing the risk of failure. In recent years gourmet bakers capture large share of the market.
If we talk about else then the bakery items, dairy, beverages and ice cream also taking good records of selling. The main goal of gourmet bakers is to increase revenue and profits.
Marketing Strategies
Gourmet Bakers adopted customer’s oriented Marketing strategies to attract customers as much as it can. Gourmet bakers follow Differentiation strategy such as strategy emphasizes a product that is unique in the industry provides distinct advantage to the bakers.
One the prominent Marketing strategy of Gourmet bakers is focusing on special classes of customers. Like gourmet bakers is focusing on the lower class as well as middle in the city.
Marketing Segmentation
Consumer Segmentation and Targeting
Introduction: The market for any product is normally made up of several segments. A ‘market’ after all is the aggregate of consumers of a given product. And, consumer (the end user), who makes a market, are of varying characteristics and buying behavior. There are different factors contributing for varying mind set of consumers. It is thus natural that many differing segments occur within a market
Bases for Segmentation
Markets can be segmented using several relevant bases. There is huge number of variables which leads to market segmentation. They comprise easy to determine demographic factors as well as variables on user behavior or customer preferences.
Market can be segmented on the following customer characteristics
Geographic Segmentation
Demographic Segmentation
Psychographic Segmentation
Behavioral Segmentation
Geographic Segmentation: Potential customers are in a local, state, regional or national marketplace segment. Geographic location plays a major factor in segmenting your target markets. While for retail store, geographic location of the store is one of the most important considerations, and in this case city areas are preferred. We are launching our product in Pakistan. In first phase we will launch our product in Lahore.
Demographic Segmentation: Segmentation of customers based on demographic factors is:
Age: 5-60
Gender: Male/Female
Family life cycle: Young, Single, Married, And Older
Income: As concluded from the survey that our prices are economical so everyone can afford it.
Education: Grade school or less, some high school, high school graduate, college graduate
Psychographic Segmentation: Psychographic Segmentation groups customers according to their life-style and buying psychology. Many businesses offer products based on the attitudes, beliefs and emotions of their target market. The desire for status, enhanced appearance and more money are examples of psychographic variables. They are the factors that influence your customers’ purchasing decision. A seller of luxury items would appeal to an individual’s desire for status symbols. Psychographic Segmentation includes variables such as:-
Activities Interests Opinions Attitudes Values
Activities, Interests, and Opinions (AIO) surveys are one tool of measuring lifestyle.
Behavioral Segmentation
The primary idea in buyer behavior segmentation is that different customer groups expect different benefits from the same product and accordingly, they will be different in their motives in owing it and their behavior in buying it. Variables of buyer behavior are:
Occasions: We are targeting special occasions like New Years Eve and Valentines
Day. Our product can also be used on regular bases as in winters people like to have
Chocolate with nuts.
Benefits: The main benefit of our product is that we are providing good quality product at economical prices. Keep the customers fitness in mind we are providing chocolate coated with nuts which will have a low calorie count
User’s status: As we are launching a new product our product will be categorized in first time users.
Readiness stage: According to the Questionnaire result we have come to the conclusion that people are interested in our new product.
Attitude towards the product: The attitude towards our product is positive as people are very interested in our new product.
Marketing Profile
Situational Analysis
It’s been many years since Gourmet Bakers is doing its business in Lahore and has gained the confidence of the Customers and now it has decided to launch a new product in Lahore.
Winters have come in Pakistan and it’s usually cold as the winter season starts the demand for the dry fruits also increases and so does the chocolate. The reason for the increase for the chocolate is that it melts in the summer season in the normal temperature.
According to a survey the consumption of the dry fruits in the winter increases by more than 35% so Gourmet has decided to launch a chocolate which has a beautiful combination of dry fruits in it and coated with the chocolate. Chocolate is being considered as the most delicious in Pakistan. It is also given as a gift to others especially on the Valentine’s Day.
Market Summary
Talking about the market summary the company should be well aware of its resources and the segments it would serve. Also divide the market into groups, based on demographic variables such as age, family size, income, occupation and education. So we will discuss target market and market demographics
Target Market
The target market of gourmet bakers consists of each and every type of class i.e. one by one gourmet bakers has covered every area of the Lahore not only Upper class as well as middle and upper class.
The prices of Gourmet products are lower as compared to their main competitors and secondly their outlets are located in every areas of Lahore. Keeping these factors in view we can say that there target market is lower middle and upper class as well.
Evaluating market segments
Our segment size would be from age 5 – 60. The reason to target this age is because chocolate is eaten and liked by every one of us from child to the person of mature age.
Differentiated marketing
We would go for different offers for each age group. As we will split our segment into three different groups. That is from age 5 – 10, 11 – 20, and 21 – 60. We will offer a milk chocolate coated with nuts for children’s and it would be packed in an attractive wrapper for children’s
Swot Analysis
Strengths
Quality and brand name of our product will be our strengths.
Strong demand for confectionery the market has grown consistently every year for the last four years. So it will bring bloom to the confectionery market.
Price kept that it should be in the range of every one ‘s purchase
Gourmet sets of benefits is its strength which is notorious and delicious
Weakness
Other competitors have greater international experience
Single manufacturing unit at one place
Opportunities
Many cities to capture
One of the most important opportunities is that Gourmet can increase their target market by capturing other cities which consist of the potential customers
Huge investments on advertisements
Intensive Distribution
Threats
Indirect and latent competitors.
Many big players have major position in the market like Cadbury nestle, kit Kat In peak time Public purchase generally branded chocolates and local manufacturers are ignored. Highly qualified employees in big brands
Huge investments on advertisement by other brands
Competition
Our main competition is Cadbury chocolate with nuts as there is no close competitor of Cadbury in Pakistan. The new thing in our product Enticing treats is that we are providing variety of nuts in one chocolate. Our competitive field is consolidated because it is targeting all age groups.
Identifying Possible Competitive Advantage
Economical price of our product.
Gourmet position it’s product as offering the best quality and services.
Strong brand name
Porter’s 5 point analysis
New entrants – imported brands
Substitutes – As chocolates are viewed as an indulgence, low threat from snacks
Competition intensity- 2 players control 95%
Buyer power – Low buyer power since quantity purchased is small, threat in future from organized retail
Supplier power – No threat of forward integration, but volatile prices of key inputs
Marketing Mix
Product strategy
We have the competitive advantage that is our quality and our product is a convenience product
No matter how effective the promotion and packaging, a firm will find it very difficult to market a product which fails to satisfy a consumer need.
Introduction of new range of chocolates to suit different targeted segments Variety Design – Plain bars, filled. Sizes and Packages – wide range to suit key price points and occasions
The Types
Smooth Chocolate Chocolate with Nuts Caramel Chocolate
Brand strategy
We will position our brand at its attributes that is its innovative ingredient and good taste. And strong beliefs and values as Gourmet have many loyal customers.
Brand Name
Brand name should be distinctive, unique, and easy to pronounce and remember. Gourmet is one of the strongest brand names having a unique generic color.
Brand Sponsorship
Gourmet products are launched as Manufactures brand for example Bread, Milk, Gourmet Cola, Ice-Cream, and Pizza. It also serves as private brand as it keeps Coca- Cola, Pepsi etc along with Gourmet Cola.
Brand Development:
Gourmet develops its product by line extension e.g., Different colors, sizes, flavors of different products like Lays.
Gourmet also develops its products by brand extension one example of Gourmet brand extension is Gourmet Restaurant.
Product Life Cycle
Product Life Cycle consists of four different stages. Through these stages we analyze the products current position in the market. We can analyze the profitability ratio and growth of our products and profitability.
Gourmet is in growth stage, it is a stage in which there is rapid market acceptance and profits increase during this stage.
Overall Positioning on the basis of Value Proposition
As far as the positioning of the brand is concerned we will use ‘More for Less’ positioning strategy. We will give more benefits to our customers and charge fewer prices for our product as compare to other competitor brands.
Effects on Consumer Behavior
Special editions of Gourmet chocolates will be used to affect consumer behavior. Market research has shown that consumers prefer special editions to be available for limited periods only and that consumers will likely to purchase the original Gourmet Chocolate at the same time or shortly after. They are, therefore, a good way of injecting new life into the Gourmet chocolate product life cycle. Depending on their popularity, some special editions will be introduced more than once.
Pricing strategy
A key advantage of maintaining a strong brand image in a competitive market is a degree of flexibility in the pricing strategy. It is a common characteristic of imperfectly competitive markets for producers to concentrate on non-price competition. Our pricing strategies are as follows
Propose Price
Weight Prices
20gm pack, Rs.10
50 gm Pack, Rs.25
150 gm Pack, Rs.75
We will provide good quality in an economical price. We have made the Price of our Product so economical so that even a lower class can afford it. We have not made this Product for only one class but it is for all.
Market penetration pricing
We will set the low initial price in order to penetrate the market. Quickly and deeply and win a large market share. The high sales volume results in falling cost, allowing the company to cut its prices further several conditions must be for this low price strategy to work,
First the market must be highly price sensitive so that the low price produces more market growth
Second production and distribution cost must fall as sales volume increases
Third the low price must help keep out the competition and the penetration price must maintain its low price position otherwise the price advantage may be only temporary
Effects on Consumer Behavior
The price also had a great effect on consumers specially those who are price conscious people because the price of the Gourmet chocolate will remain stable so the customers will remain loyal with the brand. In pricing Consumers’ background and socio-economic status including income, education etc. also plays a pivotal role and because of the very much stable price even the lower middle class customers can also afford it.
Placing Strategy
As Gourmet has its outlets in Lahore so we will launch this product in Lahore.
Gourmet has its own distribution channels which ensure the availability of Gourmet chocolates to buy wherever and whenever the consumer wishes to purchase it. Sales of confectionery depend heavily on its availability. Consequently, Gourmet will try to supply as many outlets as possible
Effects on Consumer Behavior
Place has a great role in consumers buying behavior because it doesn’t matter how good the product is if it is not available easily for the customers they would not buy it. So the company needs to make sure the availability of the product.
Promotional strategy
Typically it is said that chocolates are being eaten when everyone is happy. And this is something advertising has always portrayed. But it is found chocolates are eaten under diverse conditions and moods – when people are anxious, when they are sad, when happy a whole range of emotions.
Condensing these views & thoughts, it can be said chocolate is a true soul mate.Someone who is with you through the ups and downs of life, helping you bounce back
Gourmet Chocolate advertising will be concentrated in following Medias:
Television commercials (very few) Posters and Banners where the powerful colors of the pack and product are used to dramatize
the message
Effects on Consumer Behavior
A particular challenge for the advertisers is to appeal to both the consumers and the purchasers. A large proportion of these purchases are subsequently consumed by children. Men eat as much as they purchase suggesting they are less generous, so we think that they need to advertise more in televisions.
Competitor Analysis
Confectionery and Chocolate Industry – An overview:
Despite Pakistan’s confectionery and chocolate industry has enjoyed an emerging and growing trend in the recent past yet its size and growth pattern has been far inconsequential compared to other countries of Asia-pacific region. The industry has grown with an average annual rate of 6.5 to 7.5 % during 2002-2008. Domestic brands dominate the market accounting for more than 85% of total value sales of the industry.
The industry as a whole can be divided between two broader sectors namely organized sector (branded segment) and un-organized sectors (generic segment). The branded segment is more of monopolistic in nature where there are nine prominent, active players in the competitive landscape of this sector. However 80% of the industry’s share is being enjoyed by the five companies listed below. A brief overview of major companies’ estimated annual sales in PKR (1 US$= 83 PKR) is as follows:
Company name, Major Product lines, Major brands Estimated annual turn-over PKR (1US$=83PKR), Share %
Direct Competitors (Manufacturers and their Brands)
Mitchell’s(only Confectionery & Chocolates) Groceries ( Squashes, Jams, sauces, Chocolates- Moulded and Countlines , Toffees and candies Milk Toffee, Fruit BonBon, Butter Scotch, Jubilee, Golden HeartsMarket Share: 0.70 billion 5% Share
Implementation
After having a detailed discussion and planning gourmet comes towards the implementation phase of their marketing strategies. In implementation the company’s formal organizational structure plays and important role. Managers not only focus on short term profits but they also consider long run market building objectives. On the other hand company also considers its culture in implementing a plan.
Packaging: Chocolates are packed in bags, that consist of thin layer of aluminum foil and printed sheet attached and sealed together, which protect the product from heat, light, air, germs etc keeping the real taste for long time. The sizes of these packs depend upon the product quantity
Distribution: Gourmet has its own channels and it will launch its new product in its own outlets.
Promotion: When it opens its new branch it gives 25 % discount and seasonal sales promotions. It will advertise it product on channel City 42
Pricing: Gourmet is giving quality product at reasonable price.
Research Report “If Gourmet Enters In Chocolate Industry”
Posted by admin on January 13, 2013 in MANAGEMENT No comments
Executive Summary
The project assigned to us by our instructor is based on concept of managerial economics and their application in the real world.
For this purpose, we have introduced a chocolate of Gourmet and its competitor is Cadbury, Chocolate. This report covers the SWOT analysis of Gourmet chocolate, market condition of chocolate industry, market structure of Gourmet chocolate, the available substitute, per unit price of Gourmet chocolate in comparison with the Cadpbury Chocolate, different flavors of chocolates, the fixed cost and the variable cost and answers of some questions. I.e. At what price
GOURMET chocolate should be sold to maximize profit? How does the cost of Cadbury Chocolate affect sale of Gourmet chocolate? If a severe snow storm raises the price of coca beans, should the Gourmet sell chocolate and if so, at what price? Can the Gourmet remain competitive if an overseas chocolate producer pays 30 percent more for cocoa beans but pays 20 percent less for labor?
Concluding this report we would say that Gourmet is optimally utilizing the principles of managerial economics. Hence, it is being concluded that Gourmet Chocolate is a product operating exactly according to the set of guidelines of managerial economics.
Purpose Statement
The course instructor states this field is dedicated to how managers make effective business decisions. Students learning the field of managerial economics will learn about market structure, pricing strategy and competition from their textbooks. However, this information might sink in better if we apply this material in the form of a project.
Problem Statement
A hypothetical business model is being given to us on the foundations of which we need to make our own model either existing or hypothetical and on that implement what we have studied so far. The hypothetical model given to us states as:
Describe the market conditions of an orange juice company; on the project materials and instructions, list the price of apples and oranges, the peak market season of oranges, the cost to maintain the equipment and labor, as well as a chart detailing the typical volume of orange juice sold every year at a given price point. Attach sheets of paper with a question related to business operations such as, “At what price should orange juice be sold to maximize profit?” “Other questions include, “If a severe snow storm raises the price of oranges, should the company sell orange juice and if so, at what price?” “How does the cost of apples affect the sale of orange juice?” “Can the company remain competitive if an overseas orange juice producer pays 30 percent more for oranges but pays 20 percent less for labor?”
This problem statement covers almost all the questions that could help us implement our knowledge of managerial economics in various business operations. Not only these, but we can also present other scenarios to evaluate different principles of this branch of economics.
Methodology
For conducting the study being assigned to us as a project, we have decided to take a hypothetical chocolate producer. It is a Descriptive research, also known as statistical research, describes data and characteristics about the population or phenomenon being studied. Descriptive research answers the questions who, what, where, when, “why” and how…
We have to get answer like the price which will maximize profit, what will the impact of increase in ingredients of chocolate on its price, how the price of CADBURY CHOCOLATE affects GOURMET CHOCOLATE price. Can the company remain competitive if an overseas chocolate producer pays 30 percent more for chocolate but pays 20 percent less for labor?
Introduction of Cadbury Chocolate
Cadbury is a British confectionery company owned by Mondelēz International Inc. and is the industry’s second-largest globally after Mars, Incorporated. With its headquarters in London, England, the company operates in more than 50 countries worldwide.
The company was known as Cadbury Schweppes plc from 1969–2008 until its demerger, in which its global confectionery business was separated from its US beverage unit (now called “Dr Pepper Snapple Group”
Findings
We got the data of Cadbury Chocolate price according to the weight.
Objectives
Gourmet has increased its product line and introduced milk, cola and confectionery recently. Gourmet aims to provide quality. Their reputation is built on quality; their commitment to continuous improvement will ensure that their promise. Their aim is to compete with Chocolate industry and also to make their revenues and profits.
Market Conditions of Chocolate Industry
Chocolate industry has enjoyed an emerging and growing trend in the recent past yet its size and growth pattern has been far inconsequential compared to other countries of Asia-pacific region. The industry has grown with an average annual rate of 6.5 to 7.5% during 2005-2011. Domestic brands dominate the market accounting for more than 75% of total value sales of the industry.
The industry as a whole can be divided between two broader sectors namely organized sector (branded segment) and un-organized sectors (generic segment). The branded segment is more of monopolistic in nature where there are eight prominent, active players in the competitive landscape of this sector.i.e.
SWOT ANALYSIS OF CHOCOLATE AND COCOA PRODUCT INDUSTRY
Strength
Strong demand for confectioneries; it is liked by mostly by the young ones, and teenagers. Chocolate has amazing complexities and levels of flavor. One finds unique attributes for each chocolate one taste. It is preferred by children and girls in Pakistan. All firms are able to enter the industry if the profits are attractive and all firms are profit maximizes as it is a monopolistic competitive market.
Weakness
All firms produce similar yet not perfectly substitutable products. All firms have some market power, which means none are price takers. The other weakness is the tendency of chocolate to melt in the hot temperature. So, its sales decrease in the summer season.
Opportunities
The industry is characterized by freedom of entry and exit. Consumers constantly change their preferences for products. It is no surprise that consumers’ wants for chocolate products have changed to a desire for richer products, which has resulted in commercial bakeries using higher quality chocolate and cocoa product industry to produce its goods. Further, consumers also want a greater variety of chocolate products. This enables the industry to expand their product lines to meet the new needs of customers and provides an opportunity for greater sales of the new products.
Threats
The first threat is the current industrial conditions of Pakistan e.g. high prices of sugar which causes to increase in cost.
This recent health food movement has adversely affected the chocolate and cocoa product industry by causing consumers to decrease their consumption of traditional high fat chocolate products. Further, consumers may search for healthier substitutes, such as fruits, health bars, and other health-conscious snacks. This potentially will lower sales of many product segments in the chocolate and cocoa industry.
Market Structure
When we consider the market structure of chocolate industry, it comes in the monopolistic competition, as there are not many manufacturers of chocolate i.e. Cadbury Dairy Milk, Top Milk, Perk Chocolate etc. Monopolistically competitive firm has a little bit of control over its small corner of the market. The number of small firms, all producing nearly identical products, means that a large number of close substitutes exists for the output produced by any given firm. This makes the demand curve for that firm’s output relatively elastic.
Freedom of entry into and exit out of the industry means that capital and other resources are highly mobile and that any barriers to entry that might exist are minimal. Entry barriers allow real world firms to acquire and maintain above normal economic profit. Extensive knowledge means that all firms operate on the same footing, that buyers know a lot about possible substitutes for a given good, and that firms are aware of essentially the same production techniques.
Available Substitutes
Following are the substitutes available in the market for the Gourmet Chocolate:
1. Perk
2. Jubilee3. Dairy milk4. Snickers5. Bounty6. Mars
COMPARISON: GOURMETCHOCOLATE AND CADBURY NESTLE KITKAT CHOCOLATE
Price Comparison
Gourmet chocolate Nestle Kit Kat Chocolate
Price Rs. 15 Rs. 17
Weight 10 gms 10 gms
Rs. per gm 1.5 1.7
Flavor Comparison
Gourmet chocolate Cadbury Chocolate
Milky chocolate
Dark chocolate
White chocolate
Wafer chocolate
Peanut chocolate
Almond chocolate
Treat chocolate
Peanuts
Raisins
White Chocolate
Bourneville (original)
Bourneville Almond
Crunchy (original)
Crunchy Rocks
Mint chocolate
Crackers chocolate
Dairy Milk Hazelnut
Blackcurrant & Vanilla
Impact of Elasticity
Elasticity of chocolate industry is quite elastic. The demand for Gourmet chocolate is calculated as:
The estimated demand function for GOURMET is:
Q = 40 – 2P
As E =
E = -2(15/10)
Where;
Price =Rs.15,
Quantity = 10 grams as calculated from the demand function at profit maximizing level.
E = -3 > 1 in absolute terms
This shows that the demand of Gourmet chocolate is highly elastic.
Peak Market Season
The peak market season is winter because in Pakistan people are not able to eat much chocolate in summer season and also the chocolate melt in hot weather and its sales decreases.
Cost for the maintenance of Labor and Equipment
The Gourmet is already serving in the food product and it was easy for the Gourmet to accommodate in the same factory with new production plant. The new labor is acquired and the cost which is it facing is as follows;
Cost of Labor (variable)
Cost of equipment (fixed)
Wage rate per day = Rs.333
Wage per labor each month = Rs.10, 000
No. of labor units employed = 16
Total cost of labor per month = Rs. 160,000
Cost of maintaining Equipment
The cost of the machinery which is installed in the factory area cost Rs. 10, 00,000.
Maintaining cost per month of the machinery is Rs. 20,000.
Questions!!!
Q.1: At what price GOURMET chocolate should be sold to maximize profit?
We know that the profit is maximize at the point where MC=MR. For this purpose, we have estimated the following functions for Gourmet Chocolate i.e.
Demand function
Q = 40 – 2P
Cost function
C (Q) = 4 +0.1 Q2
In order to know the maximizing profit price and quantity;
TR = P * Q
Where P=20-1/2Q
TR = (20 – 1/2Q) Q
TR = 20Q – 1/2Q2
Hence, its marginal revenue is
MR = 20 – Q
Now from the cost function, marginal cost could be found as followed:
MC = Q
As we know that profit is maximum when MC=MR, so,
MC = MR
Q = 20 – Q
2Q = 20
Q = 10 gms
P = 20-1/2Q
P = 20-1/2(10)
P = Rs. 15
As a result, if Gourmet sells chocolate of 10 grams at Rs 15, it can maximize its profit.
Q2: How does the cost of Nestle Kit Kat Chocolate affect sale of Gourmet chocolate?
We can use Cross price elasticity in order to know the effect of prices of Cadbury Chocolate on the Gourmet’s chocolate demand i.e.
E = %∆Q Gourmet/ %∆P Cadbury
Suppose change in the price of Cadbury Chocolate is increased by 10%, then;
3 * 10 = %∆Q Gourmet
%∆Q Gourmet= 30%
Means 10% increase in price of Cadbury chocolate causes the increase in quantity demanded of Gourmet chocolate to 30%. So, Gourmet should continue its sale because of increase in demand and thus increase revenues.
Q3: If a severe snow storm raises the price of coca beans, should the Gourmet sell chocolate and if so, at what price?
As we know, the coca beans are the basic input of chocolate manufacturing, and if some incident increases the price of coca beans, the cost of chocolate will obviously will increase. Coca beans are the variable cost input which increases the AVC of the chocolate, thus ATC will increase. If ATC lies above the demand curve, it will result in the loss of the Gourmet. If the variable cost is not covered by the Gourmet, then at this point Gourmet should stop production of chocolate. There are 3 production alternatives i.e.
Price and Cost Result
P > ATC Profit maximization
ATC > P > AVC Loss minimization
P < AVC Shutdown
Perhaps Gourmet should stop producing. Perhaps it is better off by NOT selling chocolate. Unfortunately, Gourmet faced with short-run fixed cost. Gourmet incurs a total fixed cost e.g. of Rs. 20 whether or not it engages in any short-run production. Even if it shuts down production, it still must pay this Rs. 20 of fixed cost.
C(Q)=4+1.5Q2
Q=40-2P
2P=40-Q
P=20-0.5Q
R=P*Q
R=[20-0.5Q]Q
R=20Q-0.5Q2
MR=20-Q
MR=MC
20-Q=3Q
4Q=20
Q=5
P=20-0.5(Q)
P=20-0.5(5)
P=20-2.5
P=17.5
Profit=R-C
Profit=PQ-C
Profit=[1705*5]-[4*1.5(5)2]
Profit=87.5-41.5
Profit=46
Variable cost=Total cost-Fixed Cost
=41.5-20
=21.5
AVC= VC/Q
=21.5/5
=4.3 per unit
So, if Gourmet is facing condition when P > AVC, then it should continue production of chocolate and if the AVC > P i.e. the cost of coca beans exceeds the price then it should stop producing chocolate.
Q 4: Can the Gourmet remain competitive if an overseas chocolate producer pays 30 percent more for cocoa beans but pays 20 percent less for labor?
The new firm enters the market it decreases the market share of the existing firms and the quantity supplied of the products.
If the new oversees company pays 30% more for the ingredients the suppliers will be willing to sell the goods to new firm this factor can create the monopoly of new firm as more and more suppliers will sell the products to new firm.
If the firm pays 20% less to the labor but has advanced technology the monopoly of new firm can be created but if the firm doesn’t have advanced technology the firm remains in competitive with existing firms.
Conclusion:
At Rs. 15 per 10 gms of chocolate, GOURMET chocolate should be sold to maximize its profit.
The cost of cadbury Chocolate affect sale of Gourmet chocolate i.e. 10% increase in Cadbury Chocolate causes to increase in quantity demand of chocolate to 30%
If a severe snow storm raises the price of cocoa beans, should the Gourmet sell chocolate if its AVC is below the sale price and if AVC cross the price, then it should stop selling of chocolate.
The Gourmet will not remain competitive if an overseas chocolate producer pays 30 percent more for cocoa beans but pays 20 percent less for labor because the overseas company will be less attractive as its per unit cost will be will be more than the Gourmet cost.
IF GOURMET IS GOING TO OPEN A HOTEL.THE DIVERSIFICATION OF GOURMET
Posted by admin on November 11, 2012 in Marketing 1 comment
All acclamation and appreciation are for Allah Almighty the most Beneficent, the Merciful, the Gracious and the compassionate whose bounteous blessings and exaltation flourished our thoughts and thrived ours ambition to have the cherish fruit of our modest efforts in the form of this instant teed from the blooming spring of blossoming knowledge. My special praise for the Holy Prophet Hazrat Muhammad (Peace Be Upon Him).
Executive Summary:
Gourmet Bakers & Sweets is one the fastest growing local baker and confectioner stores in Lahore (Pakistan).It is a well reputed and re known Bakery to everyone lives in Lahore. Which gain achievement of getting maximum share of Bakery Products very rapidly?
It is the largest food retail chain of Lahore. It is number one band in the market due to its quality products & valuable services. Their aim is to be the best food company by fostering open communication and team work between customers and people.
Gourmet main goals are increase its sale, Quality and also gained the market share and competitors. Gourmet can compete because its food products offer a unique combination of Quality & Prices.
Gourmet surely is on the right course to progress. They’ve got the brand, awareness, credibility, the retail network, phenomenal store traffic and have huge expansion plans to turn their one time modest bakery to a full scale food retail and marketing business giant, for now, at least on national level. Our project was on the diversification of gourmet in hotel, how would be the response if gourmet launch hotel in Pakistan. So, the extensive research work done showed that gourmet should launch its hotel as there is demand for gourmet hotel.
Introduction:
Gourmet was launched in “1996″ since then it becomes the largest food retail chain of Lahore (Pakistan).
Gourmet is making Bakery Products affordable and available for consumers from all across the country, especially in Lahore regardless of income class.
Gourmet is making Quality products at affordable prices and it has the number one brand position amongst their competitors like Shezan, Cakes & Bakes, Rahat and International Bakers.
Gourmet Bakers is one of the fastest growing bakers. Being a local company, there approach towards business is both professional and highly aggressive.
Some Detail of Gourmet Bakers & Sweets (PVT) LTD is below:
GOURMET BAKERS & SWEETS (PVT) LTD
::.Registered Office Address:
9/D, FAISAL TOWN LAHORE
::.AUTHORISED CAPITAL:
20000000
::.PAID UP CAPITAL: 50000
::.CEO NAME: CH. MUHAMMAD NAWAZ CHATHA
::.CEO ADDRESS: 9/D, FAISAL TOWN LAHORE
::.INCORPORATE DATE:
9/1/1996
::.AUTHORISED CAPITAL SHARES:
200000
::.PAID UP CAPITAL 500
SHARES:
::.AUTHORISED PER VALUE:
100
::.PAID UP PER VALUE:
100
Gourmet Bakers has completely changed the Bakery scene in Lahore. Before the launch of this chain in the city, Gourmet had Shezan and united Bakers among the top bakery names. Now for the customers, Gourmet means neat and bright stores, selling fresh and crispy stuff across the city wherever you are, you must find the outlet.
Mission Statement:
To produce market food Products by developing the value of our brands, we have to be:
Highly Productive, Qualitative and People oriented. Innovative, Competitive and dedicated to satisfying our customers and consumers. A leader in the Baking Industry, with a long term vision. Our all about food that “Energizes the soul and inspires imaginations” Pakistan, Gourmet food
should be fun, approachable, healthy, and mean to be shared with others.
Vision:
We are:
The leader in the baking industry and one of the best companies in the international food industry.
A company with trust worthy, leading brands for our consumers. Our customers preferred supplier. A strong and sound company for our stakeholders. A looking forward.
Research Method:
The research method used for gourmet is Qualitative method.
This methodology consists of depth interviews, focus groups, metaphor analysis, collage research, and projective techniques taken by highly trained interviewer-analysts. Findings tend to be subjective and the sample size is small.
This project is built up on the base of depth interviews with the sample size of 50 and the focus groups are employees, students, housewives, retired and self-employed. Metaphor analysis is also considered while measuring the problems of gourmet.
Attitude scales
Following scales are also used to measure consumer behavior towards the gourmet products
Likert scales Semantic differential scales Behavior intention scales Rank-order scales Nominal scales Word association scale Sentence completion Story completion
Buying Behavior:
Rationality:
Rationality implies that consumers select goals based on totally objective criteria, such as size, weight, price, or miles per gallon.
Emotional
Emotional motives imply the selection of goals according to personal or subjective criteria
Combine buying behavior:
The combination of rational and emotional buying behavior is combine buying behavior. “The consumers of Gourmet Bakers usually use combine buying behavior because they select their products in the basis of convenience and pricing”.
Post purchase dissonance satisfaction of retention:
When someone buys a product of gourmet and after using he evaluates that gourmet is not concerned with hygiene aspect in result of it, he may switch the brand and start using its competitor products or may stop using the product itself. Post purchase dissonance satisfaction is partially applied on areas like Cavalary or DHA as people of such areas have more choices and awareness about products rather than other areas like Ichra, Rehman-pura etc.
As this model is partially applied in order to evaluate the complaint behaviour of consumers regarding hygienic problem of gourmet.
Solution:
Gourmet must concentrate on its hygiene factor its must be focused as it is ethically and socially important that they should provide quality as well as clean product so that no one sick’s after eating the products of gourmet so in result of it they gain their customers back and also had an increase in their profits.
Model of search regret:
This model is by hook or by crook applied on both the examples like if a customer want to buy gourmet milk/gourmet water he/she starts search for the product they typical visit all the major
outlets of the city when need is not satisfy it creates negative emotions regarding the product and he/she starts blaming that
a) May be the product quality is not good (product blame).
b) May be the outlet I choose for my search does not good or standardized (store Blame).
c) May be this is my mistake I should not commit to buy it (self Blame).
d) May be the person pressed by his/her surrounding because of quality, quantity etc (other Blame).
e) Selection of alternatives, Active coping is not good in the case of gourmet because it creates a decline in sales and it also shows the knowledge attitude of an individual.
Solution:
In order to control on search regret of consumers, gourmet must have to generate all the products on all the outlets so this leads to satisfaction of customer that they are getting the product on the basis of convenience so they need not to move on other alternatives.
Enhance their product line:
Gourmet is not much focusing about its product line extension. It is the most important attributes which leads to all the major problems in a company. Gourmet need to improve its product line because it give choices to the customer that he/she will evaluate all the possible alternatives. While buying a customer sets its evoked goals that I accept these brand products based on the capability of buying. A consumer also sets its inept sets that I don’t buy it as its quality is not good etc. Inept sets are those sets which are unacceptable to an individual.
In the case of gourmet if miss A want to buy some bakery items like butter biscuits, white milky bread etc and gourmet is near to her home and having all these items than she will evaluate the best easy alternative with acceptable brand and product items as she made her evoked sets than she will definitely prefer to buy it from gourmet because gourmet is fulfilling her need in the form of providing possible outcomes of a certain product.
Lack in advertisement activities:
Gourmet Bakers are not doing any effort on their marketing strategies. Gourmet became a lot more than a bakery they are food manufacturers now but they should realize that their real competitors are not just other bakeries they are with competing brands like nestle cocacola & haleeb. All these brands use a lot of marketing plans like surveys among consumers getting their consumers feed back or exciting ads and all other type of strategies hence Gourmet does not concentrate on getting feedback from their consumers. This attitude sometimes gives a negative
impact on customer personality. Their advertisements are very unpleasant even people just get annoyed by seeing those ads. This thing decreases the motivation level. As their ads are unpleasant and are repeated frequently which generate advertising wear-out this result extinction followed by forgetting reinforcement? They have no slogan to remember it.
All type of advertisement activities should be done by keeping the following types of consumers in mind as every consumer has different type of personality and every ad give different perception to every single consumer so this is very important to know the consumer behaviour toward the product or ad:
Need for cognition (NC):
A person’s desire for enjoyment of thinking an individual with high NC more likely to respond to ads rich in product information
Visualizes:
A person’s preference for information presented visually or verbally.
Verbalizes:
Verbalizes prefer written information over graphics and images.
JND:
Just noticeable difference means a little bit difference that is not visible to everybody or we can say it a very minor difference .in this we can take an example of two lights in this we have a simple light and the other is crystal light .Theirs is a very small difference that everybody cannot judge that difference.
Freudian theory:
It is further divided in to three parts
(1) ID
(2) SUPER EGO
(3) EGO
The Id
The id is the only component of personality that is present from birth. This aspect of personality is entirely unconscious and includes of the instinctive and primitive behaviors. According to Freud, the id is the source of all psychic energy, making it the primary component of personality.
The Ego
The ego is the component of personality that is responsible for dealing with reality. According to Freud, the ego develops from the id and ensures that the impulses of the id can be expressed in a manner acceptable in the real world. The ego functions in the conscious, preconscious, and unconscious mind.
The ego operates based on the reality principle, which strives to satisfy the id’s desires in realistic and socially appropriate ways. The reality principle weighs the costs and benefits of an action before deciding to act upon or abandon impulses. In many cases, the id’s impulses can be satisfied through a process of delayed gratification–the ego will eventually allow the behavior, but only in the appropriate time and place.
The ego also discharges tension created by unmet impulses through the secondary process, in which the ego tries to find an object in the real world that matches the mental image created by the id’s primary process
The Superego
The last component of personality to develop is the superego. The superego is the aspect of personality that holds all of our internalized moral standards and ideals that we acquire from both parents and society–our sense of right and wrong. The superego provides guidelines for making judgments. According to Freud, the superego begins to emerge at around age five.
There are two parts of the superego:
1. The ego ideal includes the rules and standards for good behaviors. These behaviors include those which are approved of by parental and other authority figures. Obeying these rules leads to feelings of pride, value and accomplishment.
1. The conscience includes information about things that are viewed as bad by parents and society. These behaviors are often forbidden and lead to bad consequences, punishments or feelings of guilt and remorse.
The superego acts to perfect and civilize our behavior. It works to suppress all unacceptable urges of the id and struggles to make the ego act upon idealistic standards rather that upon realistic principles. The superego is present in the conscious, preconscious and unconscious.
The Interaction of the Id, Ego and Superego
With so many competing forces, it is easy to see how conflict might arise between the id, ego and superego. Freud used the term ego strength to refer to the ego’s ability to function despite these dueling forces. A person with good ego strength is able to effectively manage these pressures, while those with too much or too little ego strength can become too unyielding or too disrupting.
According to Freud, the key to a healthy personality is a balance between the id, the ego, and the superego
This theory can be implemented in this way:
For example few people take gourmet as cheap brand , not up to the standards of their mind set, so it would be against their ego. Whereas the person who is going and consuming gourmet products has some kind of emotional and physical attachment, for them the product alternative to gourmet won’t give same satisfaction level.
ABSOLUTE THRESHOLD
Absolute Threshold – the minimum level of a stimulus, below which there is no effect; the minimum amount below which something either does not exist or is as faint as to seem not to exist.
Implementation:
Gourmet hotel having walls painted white or ash white won’t be of much difference.
Differential Threshold – the difference between two stimuli or between one level of a stimulus and another level of that stimulus, where stimulus refers to something that causes a change in an organism.
Implementation:
Gourmet hotels with carpeted rooms, well furnished and equipped will be of more preference than the ordinary set up.
.
Organizing perception:
Market penetration leads to organize the consumer perception on the basis of figure and grounds group and closure. Organization refers to how people organize stimuli into groups and perceive them as a whole. Figure and ground go with difference. An advertiser wants just enough
contrast so that the figure is noticed but that the background adds a sensory effect. Product placement, when a product appears in a movie or television show, can be considered a figure and ground issue, in the case of gourmet if they use good channels this will also lead them to recover this problem. In Group means generate content with some sort of reference as in a personal source in the case of gourmet they can make ad by the help of any personal source. In closure human minds have a need for closure and we will work to fill in the missing information when we are presented incomplete stimuli, in the case of gourmet they also try to make effective ending in the form of providing good interpretation like slogans that is
Lack in market penetration:
Gourmet is lacking in market penetration they are much focusing in Lahore rather than the rest of the cities. This is not a good sign. As they want have a strong market as compare to its competitors so they need to penetrate in other cities like kasur, Gujranwala, rawlipandi, Karachi, Gujarat, Multan, Quetta and in small villages. As they are not focusing on it they are losing its consumers and this will lead its consumers to switch to other brands.
Penetration guide to develop attitude:
Infiltration leads to extend attitude by the help of its functions that is, Value Expressive function and Knowledge function as well. Like due to penetration people get aware of its product line its quality and other important attributes this will leads to their knowledge function of attitude formation and after knowing the product they buy it this gives the impact that a customer feeling relaxed because when an individual attracted towards the brand this means he/she is satisfy with it.
Solution:
Market penetration is a healthy sign its shows the growth and generates positive in consumers mind.
Customer Satisfaction:
Gourmet needs to control its problem in order to maintain its customer’s motivation because motivation process is that when someone wants something to be as need it gives tension to him. To fulfill its need the move towards the gourmet if these hurdles are removed he/she buys the product and achieve its desire which in result of tension reduction it turns into customer satisfaction because to satisfy consumer is the basic and essential element of any business.
Types of buying behavior
There are four typical types of buying behaviour based on the type of products that intends to be purchased. Complex buying behaviour is where the individual purchases a high value brand and seeks a lot of information before the purchase is made. Habitual buying behaviour is where the
individual buys a product out of habit e.g. a daily newspaper, sugar or salt. Variety seeking buying behaviour is where the individual likes to shop around and experiment with different products. So an individual may shop around for different breakfast cereals because he/she wants variety in the mornings! Dissonance reducing buying behaviour is when buyer are highly involved with the purchase of the product, because the purchase is expensive or infrequent. There is little difference between existing brands an example would be buying a diamond ring, there is perceived little difference between existing diamond brand manufacturers.
Consumer Buying Behavior
Problem/Need Recognition
How do you decide you want to buy a particular product or service? However, for impulse low frequency purchases e.g. confectionery the process is different. You are out for vacation there will be a need of comfortable and affordable hotel
2. Information search
You will look for all hotels in that area.3. Evaluation of different purchase options.
You can have various options of competitor like PC hotel, Marriott.
4. Purchase decision
Through the evaluation process discussed above consumers will reach their final purchase decision and they reach the final process of going through the purchase action e.g. you will select gourmet according to your requirements,
Post Purchase BehaviourEver have doubts about the product after you purchased it? This simply is post purchase behaviour and research shows that it is a common trait amongst purchasers of products. Manufacturers of products clearly want recent consumers to feel proud of their purchase, it is therefore just as important for manufacturers to advertise for the sake of their recent purchaser so consumers feel comfortable that they own a product from a strong and reputable organisation. This limits post purchase behaviour. i.e. You feel reassured that you own the latest advertised product.Factors influencing the behaviour of buyers.
Consumer behaviour is affected by many uncontrollable factors. Your friends, your upbringing, your culture, the media, a role model or influences from certain groups.
Culture is one factor that influences behaviour. These factors will influence their purchase behaviour however other factors like groups of friends, or people they look up to may influence
their choices of purchasing a particular product or service. Reference groups are particular groups of people some people may look up towards to that have an impact on consumer behaviour. So they can be simply a band like the Spice Girls or your immediate family members. Opinion leaders are those people that you look up to because your respect their views and judgements and these views may influence consumer decisions.
So on that basis you opt for gourmet hotel to spend vacation.
Maslow’s Hierarchy of Needs
Abraham Maslow hierarchy of needs theory sets out to explain what motivated individuals in life to achieve. He set out his answer in a form of a hierarchy. He suggests individuals aim to meet basic psychological needs of hunger and thirst. When this has been met they then move up to the next stage of the hierarchy, safety needs, where the priority lay with job security and the knowing that an income will be available to them regularly. Social needs come in the next level of the hierarchy, the need to belong or be loved is a natural human desire and people do strive for this belonging. Esteem need is the need for status and recognition within society, status sometimes drives people, the need to have a good job title and be recognised or the need to wear branded clothes as a symbol of status.Self-actualisation the realisation that an individual has reached their potential in life. The point of self-actualisation is down to the individual, when do you know you have reached your point of self-fulfilment?
But how does this concept help an organisation trying to market a product or service?Well as we have established earlier within this website, marketing is about meeting needs and providing benefits, Maslows concept suggests that needs change as we go along our path of striving for self-actualisation. Supermarket firms develop value brands to meet the psychological needs of hunger and thirst. Harrods develops products and services for those who want have met their esteem needs. So Maslows concept is useful for marketers as it can help them understand and develop consumer needs and wants.
Living is a basic need and first step in Maslow hierarchy of needs. Then there is safety that gourmet hotel will be providing, then the people with the specific class can afford living in thids hotel, mediocre and upper class.
Suggestions:
Following are the suggestions for gourmet to improve its market as compare to its competitors.
They are just focusing on product extension but they also need to improve their quality. They need to provide hygiene food to customers because lack of it would cause of brand
switching. They also need to work on digital media because they not only computing with local
brands like shezan. International but also with international brands like coca-cola and nestle in specific products.
They also need to make their product available on every outlet. They need to improve their layout of the outlet in order to attract customers. They also need to improve their graphic regarding to products label like gourmet cola
graphic is not of good quality. They need to develop stimulus generalization for their products. They need to make some interpretation regarding to stereotypes like good and effective
slogan and also use any personal source. They need to improve their activities in the form of organizing seasonal festivals,
carnivals. By improving all the essential points gourmet can make its customers ethnocentric.
This term report is a precise application of all the marketing techniques which we studied in consumer behaviour in order to evaluate the level of satisfaction of consumer choice.
In the end we suggest gourmet that to get high profits, strong market rather than its competitors and also to satisfy its customers gourmet should need to resolve these problems.
