Situation Analysis

CHAPTER 1 Project Overview

CHAPTER 2 Project Profile

CHAPTER 3 The Company

CHAPTER 4 Consumers and Stakeholders

CHAPTER 5 The Industry and Marketplace

CHAPTER 6 Competitive Situation

CHAPTER 7 SWOT Analysis

CHAPTER 8 Strategic Target Audience

CHAPTER 9 Research Development

CHAPTER 10 Precedent Studies

CHAPTER 11 References

CHAPTER 12 Appendices

MEDIA INNOVATION Design Project 1

(MMI3213)

SITUATION ANALYSIS Brand: Cupcake Chic

Name: Amira Fateha bt Tambi ID: 1092700093

1

Chapter 1: Project Overview __________________________________________________

1.1 Introduction

Figure 1: Cupcakes by Cupcake Chic

Cucpakes are more versatile than ice-cream, donuts, traditional cakes or any

other form of dessert. Cucpakes can be a form of dessert to cater to the impulsive

craving of the individual much like ice-cream, ice kacang or a slice of cake. Yet, it

can also be a personal gift to someone special. Cupcake Chic is a premier cupcake

specialist bakery (known as a cupcakery) offering 24 cupcake flavors with a

combination of 12 flavors that changes daily. The wide assortment ranges from the

classic best selling duo of the chocolate Fatal Attraction and the unique cream cheese

frosted Red Velvet to the local favourite, Onde Onde cupcake and every other flavor

in between.

At Cupcake Chic, they bake everything from scratch, every single day. The

apples are lovingly peeled and cored. The pecans are caramelized in a pan. The

bananas are mashed when they are at their sweetest and ripest. The lemons and limes

are hand-zested. They mix and bake them just as you would in your own kitchen.

They were introduced to the market in Malaysia in January 2008 and already have 3

outlets located in Selangor area. Cupcake Chic has slowly grown to become a familiar

and popular name in urban Kuala Lumpur.

2

1.2 Problem Statement and Issue

The problem faced by Cupcake Chic is people’s perception when it comes to trying

out new cake inventions like the large size cupcake produced by Cupcake Chic. In

terms of pricing, the extra large cupcake named “Livin’ Large Cupcake” are a bit

pricey than ordinary cakes sold by other brands. This leads consumers to buy cheaper

sold cakes instead. They are also lack of advertisement and promotion of their

products.

1.3 Objectives and Aim

Objectives:

• To inform the public about the advantages of the cupcakes by emphasizing the fresh ingredients used in making the cupcakes.

• To change people’s perception by perceiving the quality and value of the

products.

• To create brand awareness to those who are unfamiliar with the special cupcakes produced.

• To renew the brand’s positioning statement.

Aim:

The aim of this project is to collect and gather useful information to create an

effective advertising approach to improve the brand image of Cupcake Chic and thus,

guiding consumers to enjoy the cupcakes as well as knowing the benefits of its

products.

3

Chapter 2: Project Profile __________________________________________________

2.1. Product Name

Cupcake Chic

2.2. Product Classification

Cupcake Chic is a consumer product because their products function are to satisfy an

individual’s need and desire. It is categorized as a non-durable product due to its

food/edible goods that will fit human’s consumption and will eventually be finished.

Cupcake Chic is also a shopping good as consumers get the chance to choose their

desirable products/flavours that matches their interest.

2.3. Product Characteristics

Category: Cupcakes, macarons, large size cupcakes, biscottis

Type: Food dessert

Packaging: The products are normally served in a designed box with the brand’s logo

sticker on it.

Figure 2: Cupcake Chic’s packaging design

Flavour Range: 24 international and local flavours. New flavours are also available

for a limited time during festive seasons.

Unit of sale: Per cup/ ½ dozen / 1 dozen

4

Price Range:

• RM 4.90 – RM 51.00 (for cupcakes serving depending on quantity from one

cupcake to ½ dozen and 1 dozen cupcakes)

• RM 3.90 – RM39.60 (for macaron packs depending on quantity from single

macaron to ½ dozen and 1 dozem macarons)

• RM 75.00 – RM 150.00 (for Livin’ Large cupcake depending on toppings and

optional add ons such as birthday candles and fondant letters)

Figure 3: Cupcake Chic’s product price range

RANGE SELECTION PRICE (RM)

Cupcake

Single 4.90

½ dozen 27.00

1 dozen 51.00

Macaron

Single 3.90

½ dozen 22.20

1 dozen 39.60

Livin’ Large Cupcake

Cake Flavours

Back to Basics

Fatal Attraction

Red Velvet

Othello

75.00

85.00

80.00

85.00

Add a filling 5.00

Add a topping 2.00

Optional Add Ons

Birthday candles

Fondant letters

5.00

2.00

5

Figure 4: Cupcakes and macarons by Cupcake Chic

Figure 5: Livin’ Large cupcakes by Cupcake Chic

2.4. Product Range

Cupcake Chic serves a wide variety of selection of cupcakes, macarons and also

large-sized cupcakes. They contain only the finest and best quality ingredients and are

made with fresh dairy products from halal suppliers.The flavours offered for cupcake

includes 24 different flavours which are categorized into 4 categories called Classics,

Lites, Love ‘Em and Chocoholics. They offer a combination of 12 different cupcakes

daily so each day is a new experience for consumers. As for macarons, each of them

are Dainty French cream-filled sandwich cookies. They are available in 12 different

and unique flavours daily. As for the product of Livin’ Large cupcakes, they are

available in four of Cupcake Chic’s top flavours. Customers can also customize their

own frosting design, colour, add-on fillings, toppings and other additional add-ons as

well.

6

Cupcakes:

Classics

Flavours

Fatal Attraction

Belgian chocolate cake with chocolate

frosting

Back to Basics

Vanilla cake with vanilla frosting

Red Velvet

Red velvet cake with cream cheese

frosting

Naughty ‘n Nice

Vanilla cake with chocolate frosting

Chocofee

Coffee cake with chocolate frosting

(mocha)

Othello

Belgian chocolate cake with vanilla

frosting

Figure 6: Classics category

7

Lites

Flavours Description

Strawberries ‘n Cream

Strawberry filled cake with vanilla frosting

Peaches ‘n Cream

Peach cake with cream chantilly and almond flakes

Hello Sunshine!

Orange poppyseed cake with citrus frosting

Blueberry Crumble

Blueberry oats cake with oats crumble

Adam’s Apple

Custard filled cake with apple cinammon slices

Lemon Meringue

Lemon cake with meringue topping

Figure 7: Lites category

8

Love ‘Em

Flavours/ Description

Arabian Nights

Dates cake with toffee frosting

Utter Peanut Butter

Peanut butter chocolate chip cake with peanut butter frosting

24 Karat

Carrot walnut cake with lime cheese frosting

Tiramisu

Coffee infused cake with cream cheese frosting

Cookies ‘n Cream

Cookies and cream cake with vanilla frosting

Onde onde

Pandan gula melaka cake with coconut frosting

Figure 8: Love ‘Em category

9

Chocoholics

Flavours Description

Nutters Gone Bananas

Banana cake with chocolate hazelnut frosting

Rich & Cool

Belgian chocolate cake with peppermint frosting

Blackforest

Chocolate cherry cake with whipped cream frosting

Jaffa

Chocolate orange cake with chocolate frosting

Rocky Road

Devil’s food cake with rocky road topping

On Cloud 9

Chocolate marshmallow cake with chocolate frosting

Figure 9: Chocoholics category

10

Macarons

Flavours

Black sesame

Fatal Attraction

Earl Grey

Green Tea

Peanut Butter & Jelly

Raspberry

Coconut Ginger

Coffee

Lavender

Lemon

Red Velvet

Salted Caramel

Figure 10: Macarons by Cupcake Chic

11

Livin’ Large Cupcakes

Flavours

Back to Basics

Fatal Attraction

Red Velvet

Othello

Figure 11: Livin’ Large cupcakes by Cupcake Chic

2.5. Distribution

Cupcake Chic products are directly distributed to their specific outlets where

consumers get to buy them without involvements of any intermediaries. Based on the

product life cycle graph, it is shown that Cupcake Chic’s sales are currently at its

growth stage as they are still focusing on improving their promotion and advertising

strategies to reach its target audience. Cupcake Chic is considered an emerging

products that are growing in the food industry.

12

2.6. Product Life Cycle

Figure 12: Product life cycle of Cupcake Chic

2.7. The Brand

Cupcake Chic is Malaysia’s first and premiere cupcakery which has its own

core business of producing cupcakes. They commit to making sure that their cupcakes

are fresh baked and delivered to outlets daily, keeping their quality consistent by

using quality ingredients and fresh dairy products. They offer products, which include

cupcakes, macarons, biscottis and also large-sized cupcakes. Cupcake Chic differs

themselves from a sea of smaller, home-based competitors by relentlessly focusing on

innovation to develop the best-tasting and most memorable products across multiple

platforms to maximize more revenues. They offer a wide variety of products, which

include cupcakes, macarons, biscottis, beverages and large-sized cupcakes. Their

products also cater to larger groups of people especially those who are doing event

ocassions such as weddings, birthdays, corporate events, parties, engagements which

incorporate cupcakes as their centerpiece of attraction.

13

2.8. Brand Image and Implication

Cupcake Chic is well known for its cupcakes that are high quality and offers a wide

variety of flavours. According to the founder, Joanne Ho, Cupcake Chic is bringing

the popularity of the retail cupcake industry (worth US$6 billion in the US and

growing at +35% year on year) from the USA to Malaysia. Customers enjoy buying

products from Cupcake Chic relentlessly because of their commitment to innovation

in the areas of creative menu, store design and also customer engagement. Not to

mention, they serve as a delicious food dessert for costumers too. Cupcake Chic is

currently a growing brand in terms of expansion of its cupcake business and

popularity among consumers. They are expanding through franchise outlets in

Malaysia and may expand widely through other countries too in the future. Cupcake

Chic’s loyal customers love the brand for their range of flavours and frequent

discount promotions offered in special events and festives.

2.9. Strengths and Weaknesses

Strengths:

• Offers 24 cupcake flavors.

• New flavors invented during special holiday festives.

• First cupcake bakery also knows as cupcakery in Malaysia

• Uses fresh fruits and ingredients

• First to produce large sized cupcake

Weaknesses:

• Outlets are not available in many states. Only focuses in Selangor area.

• Consumers perception in terms of pricing (expensive)

• Limited advertising and promotion of the cupcakes

14

2.10. Advantages and Disadvantges

Advantages:

• Varieties in flavours to be choosen by customers

• Unique designs for each products differs from different flavours.

• Fresh dairy products used for baking.

• All ingredients are taken from halal suppliers.

• Caters for special ocassions (wedding, birthday party, corporate events etc.)

• Customers can make online ordering and products will be delivered.

Disadvantages:

• Outlets are only available in Selangor area.

• Competition from other brands

• Delivery of products made through online ordering are limited only to

Selangor, Wilayah Persekutuan, Penang and Johor.

2.11. Unique Selling Proposition (USP)

Cupcake Chic offers the best-tasting cupcakes from small to large sizes in variety of

flavours.

2.12. Promotional History and Advertising Schedule

Promotions for Cupcake Chic are actively done in Cupcake Chic’s fan page through

social networks such as Facebook and Twitter. Below are some of the promotions

offered:

15

Events and Activities

2009:

1. 22nd January - Chinese New Year Celebration, The Curve

2. 4th May - TimeOut Birthday Bash,Time Out Kuala Lumpur

3. 26th August – McDonald’s Malaysia anniversary,Kuala Lumpur

4. 30th August – Asia Wedding Shoot, Colmar Tropicale, Bukit Tinggi

5. 4th September – Cupcake Chic’s Appreciation Dinner,C.Club, Pavillion KL

2010:

1. 31st January – Pavillion Kuala Lumpur 2nd Anniversary, Pavillion KL

2. 21st April – Garden Wedding Theme , Grand Dorsett Subang

3. 9th May – Mother’s Day Celebration, Sunway Pyramid

4. 12th May – La Senza’s Roadshow, KLCC

5. 16th May - “Her World” Mothers & Daughters Cupcake Decorating Session,

Pavillion KL

6. 17th June – Wong Sze Zen’s wedding (former Miss Malaysia) , Kuala Lumpur

7. 16th September – Cupcake Chic New Flavours, Pavillion KL

8. 8th October – Blackberry Bold Launch, Cupcake Chic The Curve

9. 14th October – Digi Rocks! Campaign, Pavillion KL

2011:

1. 11th February – Valentine’s Day Celebration, The Curve

2. 15th April – Masterchef Malaysia’s Audition Launch,Kuala Lumpur

3. 18th April – Kingdom Women Conference, Kingdom City Church, PJ

4. 22nd April – Time dotcom Astro B.yond Launch, Petaling Jaya

5. 23rd July - Daily Muscle Transformation Camp, Taman Tun Dr Ismail

2012:

1. 26th May – Disney Pixar’s Brave Cupcake Decorating Class, Sunway Pyramid

2. 13th June – Cupcake Camp 2012, Cupcake Chic The Curv

16

Promotions and Coupon Deals

1. Zalora Voucher

• Buy 5 free 1 cupcake with Zalora shopping voucher worth RM30

• Buy 9 and above, free 3 cupcakes with Zalora shopping voucher worth RM60

• Valid from 20 July – 30 August 2012

2. Cupcake Chic collaboration with Espresso Lab

• 1 set of espressoLAB coffee and 2 cupcakes for only RM10

• Valid from 26 May – 10 June 2012

3. Cupcake Chic Online Coupon

• Free cupcake with 1 purchase of cupcake

• Valid only with original email after free Cupcake Chic newsletter subscription

• Valid until 31 December 2011

4. Ramadhan Special 2011

• Buy 9 free 3 cupcakes

• Valid from 1 – 29 August 2011

5. We ♥ Japan

• Every box of “I ♥ Japan” red velvet cupcakes purchased, 50% will go to the

World Vision Japan Quake & Tsunami Fund

• Valid from 22 – 31 March 2011

6. Groupon

• 50% off for 1/2 dozen cupcakes at RM13.50 instead of RM27.

• Available at Sunway Pyramid and The Curve

• Valid from 27 – 30 September 2010

• 127 coupons sold

17

7. Fabulous Food Month of November

• 15% off for 1 dozen of cupcakes and above

• Valid from 1 – 30 November 2009

8. Merdeka Weekend Special

• Durian Chocolate Cupcake

• Valid from 28 – 31 August 2009

9. Ramadhan Special 2009

• 25% off for 1 dozen cupcakes

• Discount from RM48 to RM 36 per 1 dozen

• Valid from 21 August – 19 September 2009

10. Valentine’s Dolce Box

• 6 Valentine’s themed cupcakes for RM35

• Valid on 13 & 14 February 2009

11. Christmas with Cupcake Chic

• White Christmas Cupcake and Choco Mint cupcake

• Available from 1 – 31 December 2009

12. Follow @thecupcakechic on Twitter

• Free “Fatal Attraction” cupcake when you follow @thecupcakechic on Twitter

• Valid on 14 September 2009 with given password for cupcake pick-up.

13. Christmas Promo

• 1 “Fatal Attraction” cupcake to be picked up at Centre Court,The Curve

• Valid from 30 November 2007 – 6 January 2008

18

Newspaper and Magazine

1. MT.(January 2012).Cupcake Chic – life in the cupcake world.Malaysia Tatler

Magazine

2. Pillars. (November 2011). Princess of cupcakes. SME Malaysia

3. Tania Wee. (April 2011). How do you work with someone close to you? Her

World Magazine

4. Carolyn Hong. (September 2009). Twitter’s reach growing in Malaysia.

Singapore Straits Times

5. MW. (September 2009).Cupcake Chic beri kegembiraan.Mingguan Wanita

Magazine

6. Khadijah Mohamad Nor. (December 2009).Populariti Cupcake Chic.Kosmo!

TV and Radio

1. Astro Awani Interview with Joanne Ho (Ch 501) 11th October 2009, 9.30 pm

2. Cupcake Chic Interview with BFM 89.9 (Open for Business segment)

21st January 2010

2.13. Positioning Statement

Cupcake Chic offers the best-tasting cupcakes from small to large sizes in variety of

flavours suitable for consumers aged 18 – 25 years old who is outgoing and loves to

spend time with friends and families while having a dessert treat.

19

Chapter 3 – The Company

__________________________________________________

3.1. Company Overview

Cupcake Chic first opened its door in Janauary 2008. They have grown to become

more familiar and a popular name in Kuala Lumpur since then. They are considered

Malaysia’s first cupcakery that has established themselves in the food and beverages

industry categorized under food dessert. The company produces iconic cupcakes that

are available in many flavours to provide customers with something they can enjoy

everyday whether impulsively or planned. They are planning to open up more outlets

in the future. The outlets of Cupcake Chic up to this date can be found in Selangor

area which are located at Sunway Pyramid,Ampang Point and The Curve.

3.2. Business Description

Cupcake Chic products are focusing mainly on food dessert retail with

cupcakes as their main profit in the bussiness. They are not just about cupcakes alone.

They are constantly innovating their menu to include macarons, giant-sized cupcakes,

biscottis, gourmet espresso coffee as well as cookies, brownies and a

breakfast/lunch/dinner menu soon to be launched. Their brand attracts consumers

who enjoys having some dessert treat for themselves.

Since Cupcake Chic has received their Franchisor status from the Franchise

Ministry, they also provide 3 franchise investment packages, for people who are

interested in joining their business. The packages are Compatto, Medio and Famiglia

(each meaning Compact size, Medium size and Family size). Compatto is a compact-

style kiosk format between 125-175 square feet. The Compatto is a take-away model

and ideal in corporate office buildings,shopping malls,high-end condos and transport

hubs. Medio is a store format between 400-600 square feet with limited seating

space.It is also considered as an island kiosk formats with seating which combines the

best of a take-away and dine-in model.Small functions i.e parties may be held at the

Medio store. They are ideal in shopping malls and shop front lots.

20

Famiglia is a café outlet between 750-900 square feet,that builds a revenue stream dot

easy take-away,dine-in and event functions. This type allows dine-in customers to

find their personal space for a group of people to connect.The important feature is that

it caters to children- a zone for kids to play and be safe while the parents

socialize.They are ideal in shopping malls and shop front lots.

Cupcake Chic has an established business system that franchisees can leverage

on with a strong leadership marketing support by the founder. Cupcake Chic has

relentless commitment to innovation in the areas of menu, store design and customer

engagement.

3.3 Company History

Cupcake Chic is Malaysia's first cupcake specialist bakery, also known as a

cupcakery, established in January 2008. The company was founded by a husband and

wife team namely Joanne Ho and Ben Foo. They are bringing the popularity of the

retail cupcake in the food and beverage industry. Their products are not just a dessert

to be enjoyed impulsively but perfect also for celebrations large or small such as

weddings, corporate events, birthday parties, baby full moon, etc. They have 3 outlets

in Selangor area. Their main store is located at The Curve,Damansara. Another 2

outlets are owned by their franchisees - Tengku Soraya Tengku Nerang Putra and

Ramachandran A/L Muniandy. They realized that the key to successful business is to

provide customers with something they can enjoy everyday whether planned or

unexpected. Cupcake Chic specializes in making variety of flavours for their

cupcakes. They also uses fresh dairy products and ingredients which are taken from

halal suppliers in order to meet their high quality specifications in every product. The

signature product of Cupcake Chic is their iconic cupcakes.Furthermore, they also

produce macarons, biscottis, cookies and also giant-sized cupcakes. Their company

does not only depend on the franchised retail outlet but also from Cupcake Chic

Occasions (i.e. weddings, birthdays, corporate events, etc.) and online sales.

21

3.4 Key People

• Founder / Managing Director – Joanne Ho

• Co-Founder/ Marketing Director - Ben Foo

• Assistant Manager - Nadia Sofea

• Ocassions Architect - Chen Qian

• Product Innovation Chief - Swee San

• Franchisee (Ampang Point) - Tengku Soraya Tengku Nerang Putra

• Franchisee (Sunway Pyramid) - Ramachandran A/L Muniandy

3.5 Location and Subsidaries

Cupcake Chic’s Headquarters Office

Cupcake Chic Sdn Bhd

46M, Jalan SS2/67

Sunway Mas Commercial Center,

47301 Petaling Jaya, Selangor

Cupcake Chic outlets can be located at the following areas:

• Cupcake Chic @ The Curve

Lot GZF-4, Ground Floor

No. 6, Jalan PJU 7/3, Mutiara Damansara,

47810, Petaling Jaya, Selangor

Tel: 03 7726 9075

Fax: 03 7726 9058

• Cupcake Chic @ Sunway Pyramid

Lot F1.87, 1st Floor,

Sunway Pyramid Shopping Mall,

No. 3, Jalan PJS 11/15,

Bandar Sunway, Subang Jaya,Selangor

Tel/Fax: 03 5638 9989

22

• Cupcake Chic @ Ampang Point Shopping Mall

Lot FM 26-27, Ground Floor, Ampang Point Shopping Mall

Jalan Mamanda 3, Taman Dato’ Ahmad Razali

68000 Ampang, Selangor

Tel: 010 247 7545

3.6. Brand, Major Products and Services

Cupcake Chic’s meticulous attention to excellent quality and careful choice of

ingredients makes their products special. Cupcake Chic products contain only the

finest and best quality ingredients which are fresh dairy products from halal

suppliers. The signature cupcakes of Cupcake Chic consists of 24 flavours, whereby

each one differs in its unique taste and appearance. They offer a combination of 12

different cupcakes daily so each day is anew experience for the customers. The

cupcake menu is made up of 4 categories:

1. Classics consist of the popular flavours like Vanilla, Belgian Chocolate, Coffee

and Red Velvet.

2. Lites are considered “lighter” cupcakes that are not too rich and heavy catered for

the weight conscious customers.

3. Love ‘Em are their specialty range where each cupcake flavour has its own twist

to it.

4. Chocoholics are more aimed towards chocolate lovers as the cupcakes have a

good variety of chocolate inspired flavours and richer in taste.

Other products of Cupcake Chic includes macarons, biscottis and giant-sized

cupcakes called the Livin’ Large cupcakes. The services that Cupcake Chic offers

include online ordering and also Cupcake Chic Occasions, which is fully customized

cupcakes for large orders and ocassions such as weddings and corporate events.

Cupcake Chic Ocassions provide other stream of revenue to franchisees so that they

have more potential to earn and not only confined to the retail outlet only. Other

services that Cupcake Chic offers are training skills for employees and ocassion

architect that are assigned to help for special themed events.

23

3.7. Corporate Vision

• To satisfy each costumer by providing the best-tasting treats

• To enhance customer engagement service to meet customers expectations.

3.8. Corporate Mission

To provide a strong leadership marketing with the best management services that

clients can depend on in terms of the pricing, efficiency, and product design.

3.9. Company’s Current Promotional Strategy

The promotions made by Cupcake Chic are mostly active during festive months

where celebrations are held quite often. These promotions usually last for a period

ranging from one week to one month.

2012: Support & Sponsoring Events

• Disney Pixar’s Brave Cupcake Decorating Class

• Cupcake Camp 2012

2008-2012 Festive Season

• Mom’s Pink Dolce Box for Mother’s Day

• Valentine’s Day Dolce Box

• Christmas Dolce Box

• Raya Dolce Box

• Ramadhan Special

• Merdeka Weekend Special

• Fortune Cupcakes for Chinese New Year

24

3.10. Product Sales History

According to the founder of Cupcake Chic, Joanne Ho said that the outlets have

shown strong double digit growth since 2008 and it is largely due to the versatility of

cupcakes that they provide.

3.11. Current Marketing Objective

Short Term Objective:

To provide the best-tasting cupcake products and come up with new inventions of

cupcake flavours to maintain their uniqueness and high quality of products offered.

Long Term Objective:

To expand their brand to be well known nationally or internationally by their target

market and to develop more outlets and be an innovative leader in the cupcake market

industry.

25

3.12. Media Expenditure

Cupcake Chic has an established system through media for their promotional

activities. They depend more on online advertising and social media to promote their

brand. The online deals offered not only helps customers get the best deal but also

engage them with a closer interaction to Cupcake Chic.

Other than that, Cupcake Chic also uses print media such as magazines and

newspapers to promote their brand. There are also articles that can be found through

online blog reviews by food blogs and even customers who have been to Cupcake

Chic sharing their experience in their daily blog. In addition, Cupcake Chic also

produce brochures and flyers for customers to get to know about their latest products.

There are also events which Cupcake Chic are involved in especially the ones such as

launching of an event or campaign where they uses cupcakes as the centerpiece of

attraction. By this way, Cupcake Chic tremendously get the attention of other people

around to be more familiar with their brand. Latest news, events and promotions can

also be found in Cupcake Chic’s official website and also their Facebook fanpage

which is actively updated regularly. Their customer database has over 5,000 on email

and alo 75,000 on Facebook acurately up to this date.

Figure 13: Cupcake Chic’s official website

26

Chapter 4 – Consumers and Stakeholders

__________________________________________________

4.1. Current Consumer’s Characteristics

4.1.1 Demographics

a) Age

18-29 years old

b) Gender

Male and female

c) Education

High school, colleges and universities

d) Occupation

Students, white collar workers.

e) Income Range

-Student’s allowance (RM 100-RM500)

-White collar workers income (RM1500- RM3000)

f) Race & Ethnicity

All races and ethnicity

g) Geographical Location

Urban and sub-urban areas

27

4.1.2 Psychographics

a) Perception

• Enjoys spending time with families and friends.

• Loves having a dessert treat for themselves.

b) Learning

• Influences from both digital and social media such as Facebook, Twitter, online

blog reviews, online promotion deals and websites.

• Recommendation by families and friends.

c) Motivation & Needs

• Exploring unique and attractive dessert options to try out to enjoy with families

and friends.

• Loves to experiment different type of flavours.

d) Attitude & Personality

• Outgoing and loves to socialize with others.

• Jovial, adventurous, love trying out new things.

e) Lifestyle

• Active life routine and may experienced stressful study/working life but knows

how to take a break from it.

• Enjoys going out for gathering, events and celebrations.

28

4.2 Stakeholder’s Characteristics

4.2.1 Primary

The primary stakeholder is the franchisor, Cupcake Chic which is owned by a

husband and wife team namely Joanne Ho and Ben Foo. In a franchise system, the

franchisor is the entity that develops the bussiness model,brand and the whole

franchise system that franchisees can leverage on.This includes the following:

• Development of product design

• Branding and innovation in areas of menu,store design and customer engagement

• Design of the outlet (compact-style kiosk,store format and café outlet)

• Research and development of the product

• Central Kitchen that bakes and delivers to franchised outlets daily

• Customer database

• Strong leadership markerting support

• Simple operation to manage

4.2.2 Secondary

• Franchisees

Franchisees determine the package that they would like to invest in. Franchisees will

select the location of the outlet and comply to the franchise system that has been

developed by the franchisor.They are responsible for the management of their outlet

and provide the best customer service to grow their business.

• Local Authorities

The local authorities will consider and give approval to the proposed premise or

location of the outlet submitted by the franchisor/franchisee before they can start their

bussiness operations.

• Banks

The bank helps to provide loans and funds needed by the franchisor and franchisees.

29

• Suppliers

Suppliers will help in terms of supplying fresh ingredients and dairy products to the

Central Kitchen of Cupcake Chic for product baking process.

• Media

The media acts as a medium for Cupcake Chic to advertise their products and help in

terms of creating brand awareness of the company.

30

Chapter 5 – The Industry and Marketplace

__________________________________________________

5.1. The Industry

5.1.1. Definition of the Industry

In general, the food and beverage industry is widely expanding year after year. The

industry specializes in the conceptualization, the making of, and delivery of foods.

The largest section of food and beverage employees are in restaurants and bars,

including hotels and resorts. In order to satisfy consumers needs and expectations,

food and beverage industry helps to assure that the products are in high quality

guaranteed production whereby companies aim for the best products according to

consumer demands. The competitive environment of the industry is constantly

changing and entrepreneurs have the greatest influence on this matter. The food and

beverage industry changes so regularly because there is a massive variety of

businesses, great and small, that hold stake in it. This types of variety creates many

different sectors in which innovation can bloom through the industry, which leads to

more opportunities for entrepreneurs.

5.1.2 Shape of the Industry

Internationally, the food and beverage industry development growth has been

consistent each year. The industry is expected to increase 3.5% by the year of 2014.

The largest share in the food and beverage industry is currently ranked by Europe

followed by US. As for China and India, they are the major contributor of raw

materials to the industry.

Malaysia’s food industry is rich in terms of agricultural and tropical resources

reflecting diverse cultures in Malaysian society — Malay, Chinese and Indian, have

resulted in a fascinating range of processed food with an Asian twist.The Malaysian

food and beverage market is becoming highly sophisticated and is supplied by both

local and imported products. The strong economic growth in the late 80's and early

90's contributed to major changes in consumer purchases and consumption patterns.

31

Malaysians living in urban areas are relatively brand conscious, and they prefer to

shop in stores, which offer them convenience and good product selections.

Other than that, the halal industry in Malaysia also provides immense opportunities

for Malaysian manufacturers. It was estimated that the potential value of the halal

food industry range between USD600 billion and USD2.1 trillion. The concept of

halal is associated with food products which are of high quality in terms of

cleanliness, sanitation and compliance with religious requirements.

5.1.3 Development of the Industry

The issues that rises when talking about the food and beverage industry will definitely

not go further away.Some of the issues that are currently happening includes; oil price

which is unlikely to fall, pressures to be environmentally friendly will grow, health

and nutrition remain as a priority, low cost economies offering cheaper production

opportunities will dissapear, and consumers will not lose their taste nor variety and

also great value. The growing usage of alternative channels such as the Internet helps

in leading the growth in direct to consumer sales by food suppliers. Even better, we

shall see a greater regulation to control salt,sugar and fat content by governments

obsessed with the long-term economic consequences of the current public health

issues.

Malaysia’s food industry is as diverse as the multi-cultures of Malaysia, with a wide

range of processed food with Asian tastes.It is estimated that the present global retail

sales in food products are worth around US$3.5 trillion, and are expected to grow at

an annual rate of 4.8 per cent to US$6.4 trillion by 2020.

Lifestyle changes have led to an increase in the demand for convenience food and

health food. In Malaysia, the food industry is dominated by small and medium scale

companies. The major sub-sectors are the fish and fish products, livestock and

livestock products, fruits, vegetables and cocoa.In line with the emphasis on the

agriculture sector, the processed food and beverages industry had become an

important component of the agro-based industry.Employment in the processed food

and beverages industry decreased in 2009 by 5.1% to 43,080 compared with 45,418 in

2008. Labor cost for the industry remained competitive, as its Unit Labor Cost

32

decreased by 8.2%, reflecting an efficient utilization and management of resources.

Small and medium sized enterprises represent more than 80% of the total number of

establishments in the processed food segment. Malaysia is also one of the world

major producers of spices.

It is clear that the next 5 years will present an increasingly complex set of issues and

challenges for the food and beverage industry to resolve.The ability of individual

businesses to identify relevant challenges and opportunities, develop and appropriate

responses to execute effectively will be critical to their short term and long term

success. Doing the right thing, and being seen to do the right thing will be considered

core to brand relevance, and ultimately business success across the industry.

5.2 The Marketplace

5.2.1 Current Condition of the Marketplace

The marketplace for cupcake products are categorized under the dessert market which

is one of the subdivisions of the food and beverage industry. In cultures around the

world, dessert is a course that typically comes at the end of a meal, usually consisting

of sweet food.Cupcakes are the same category as cakes except that cupcake is a small

cake designed to serve one person, frequently baked in a small, thin paper or

aluminum cup. As with larger cakes, frosting and other cake decorations, such as

sprinkles, are common on cupcakes.

Internationally,there are a handful of big-name players within the cupcake industry

.Their cupcake obsession will continue as they embark upon ambitious expansion

plans. Growth within the cake decoration stores industry is expected to slow to 3.7

percent annually over the next five years, according to an October 2011 report from

research firm IBISWorld. This forecast represents a dip from the 4.9 percent growth

that the industry was predicted to have enjoyed during the past five years. In

Malaysia, the dessert market has risen in significance to the overall food market,

rising from 0.9% in 1994, to 1.4% by 1999 and continued to

grow in 2000.

33

5.2.2 Changes in Marketplace

The dessert market for cupcake products are growing progressively in Malaysia.

Cupcake cafes are considered a trend nowadays to the consumers. Given the strong

growth potential in the cupcake industry, the valuation of profit seemed reasonable.

The sales of cupcake products may face a number of challenges as well.

In recent years, volatile commodity prices for flour, sugar and milk have dented

bakery profits. This year, egg prices are expected to increase 2.9%, while sugar prices

are expected to increase 6.4 % and milk 1.6%, the USDA forecasts.

Consumers are also becoming more health conscious, moving away from sweets

while bakeries are experiencing stiffer competition from grocery stores and mass

merchandisers that sell baked goods at a lower price. But the biggest challenge for the

cupcake may also be the key to its current success. It depends on the trend of

cupcakes and if it will remain popular with consumers because it is unpredictable as

the trend could easily change.Food trends change often in the food and beverage

industry.

34

Chapter 6 – Competitive Situation

__________________________________________________

6.1. Direct Competitors

6.1.1 Wondermilk Cuppacakes

Wondermilk Cuppcakes was established in May 2006 by 6 cupcake lovers who came

together to devote their time and attention to the art of cupcake making and

decorating. They are the sister company to Wondermilk. They have 3 outlets located

at Publika, Citta Mall and Damansara Uptown. Cuppacakes are known for their fine

and exquisite cupcake creations. They are defined by their attention to details of

cupcakes including the colours,flavours,ingredients and their cupcake design. Their

outlet is a café-style concept with urban and young aesthetics in mind. Their products

include cupcakes, cookies and cakes, which are suitable for special celebrations and

equally delectable for any other ocassions.

Type: Cake

Price Range: RM 4.50 (per cupcake), RM25.00 (½ dozen cupcakes)

Strengths:

• Very detailed in terms of cupcake design

• Cupcakes can be customized by consumers according to their desired preference.

Product Range: cupcakes, cakes, cookies

Positioning: Cuppacakes produces fine & exquisite cupcake creations with a creative

approach to cupcake design.

35

6.1.2 Bisou Bake Shop

Bisou Bake Shop was founded in June, 2007. The company’s sister eateries include

Bijou and Bianco. Their outlets are located at Bangsar Village and KLCC.

Bisou Bake Shop is pretty in its decor, primarily white with dark chocolate and pink

accents that echo the rich chocolate in the cakes they serve. Taking up the space

formerly occupied by Vanilla Box, Bisou Bake Shop’s café has several good things

going for it: a varied menu, a well-thought-out design scheme and the enviable status

of being the only café on the street. At Bisou Bake Shop, their objective is putting a

sophisticated swirl on a nostalgic favourites. Sporting a selection of homestyle

cupcakes, cakes and cookies, there is something to suit every plate. With 13 cupcake

flavours everyday, cupcake lovers are spoilt for choice at Bisou Bake Shop.

Type: Cake

Price Range: RM 5.00 (per cupcake), RM30.00 (½ dozen cupcakes)

Strengths:

• Varieties in menu; cupcakes, cakes, cookies, healthy salads, daily soups, freshly

cut sandwiches made from homemade bread.

• Strong concept of the outlet

Product Range: cupcakes, cakes, cookies, healthy salads, daily soups, freshly cut

sandwiches made from homemade bread.

Positioning: Bisou Bake Shop Bisou looks set to claim its place as Asian Heritage

Row's hot spot with the best tasting treats.

36

6.2 Indirect Competitors

6.2.1 Famous Amos

Famous Amos was established in Malaysia as a private limited company under the

Companies Act, 1965 on 9 November 1983. They are the franchise holder of "THE

FAMOUS AMOS C.C.C.C.(M) SDN BHD" in Malaysia. The first Hot-baked store of

Famous Amos was opened in Sungei Wang Plaza and was officiated by the founder

himself, Wally Amos on November 30, 1984. Today, it operates over 60 successful

Hot-baked stores in shopping malls and airports in Malaysia. Currently, there are nine

varieties of chocolate chip cookies which are freshly baked throughout the day in each

of their store. By using the best ingredients, like semi-sweet chocolate chips and

flavorful nuts, their homemade tasting cookies became famous just by word of mouth.

The "Free Smell" from their baked store has been an irresistible aroma of their freshly

baked cookies to be enjoyed by true cookie lovers everywhere. Other than cookies,

they also introduced freshly baked soft cookies,muffins, brownies, chococolate and

also confectionery pick and mix which are complimentary products commonly found

in Famous Amos outlets. Readily packed and customized gifts hampers are also

available at their outlets.

Type: Confectionary

37

6.2.2 Secret Recipe

Secret Recipe, founded in 1997, made its mark,renowned for its extensive range of

fine quality gourmet cakes and fusion foods. Their outlet concept is a lifestyle café

chain. Secret Recipe has successfully established its brand name in Malaysia,

Singapore, Indonesia, Thailand, China and Philippines by virtue of their quality cakes,

and fusion food. Secret Recipe is one of the leading and largest café chain in

Malaysia, with Halal certification awarded by Jabatan Kemajuan Islam Malaysia

(JAKIM). There are more than 20 types of fusion food, 40 cake creations and pastries,

with a flavourful range of ice cream and beverages offered in all Secret Recipe

outlets.

Type: Snacks

38

Chapter 7 – SWOT Analysis

__________________________________________________

7.1 Strengths

• Offers 24 cupcake flavors,custom cupcakes and assorted arrangements.

• New cupcake flavours are invented during special holiday festives/season.

• First cupcake bakery (cupcakery) in Malaysia

• High quality cupcakes by using fresh dairy products and ingredients.

• Central Kitchen bakes and delivers to franchised outlets, keeping quality

consistent.

• Commitment in innovation in the areas of menu,store design and customer

engagement.

• First to produce large-sized cupcakes

• Available through online ordering and Cupcake Chic Ocassions (weddings,

birthdays, corporate events etc.)

7.2 Weaknesses

• Outlets are not available in many states. Only focuses in Selangor area.

• Consumers perception in terms of pricing (expensive)

• Lack of advertising and promotion

• Only delivers to Penang, Johor, Wilayah Persekutuan and Selangor for online

orders.

39

7.3 Opportunities

• Demands from other areas that will help the brand expand

nationally/internationally.

• Birthdays, weddings, corporate event etc. celebrations

• Sponsoring campaigns to increase brand awareness.

7.4 Threats

• Competition from other brands.

• Maintaining the taste and originality of cupcakes requires fresh and costly

ingredients.

• People’s perception that cupcakes are bad for health and contain a lot amount

of sugar.

• Food trend changes often.

40

Chapter 8 – Strategic Target Audience

__________________________________________________

8.1 Proposed Target Audience (Primary)

8.1.1 Demographics

a) Age

18-25 years old

b) Gender

Female

c) Education

College and universities

d) Occupation

Students, white collar workers.

e) Income Range

-Student’s allowance (RM 100-RM500)


f) Race & Ethnicity


g) Geographical Location

Urban and sub-urban areas

41


a) Perception

• Loves spending time with friends and families while enjoying a dessert that is

delicious.

b) Learning



• Recommendation by families and friends.


• Loves to experiment different new types of food/flavour.

• Follows the food trend.


• Hardworking, Focused.

• Outgoing, Sociable

e) Lifestyle

• Enjoys having quality time with friends/colleagues, families.

• Active life routine and may experience a stressful study/work life but knows how

to deal with it.

• Loves attending various type of events (birthdays, small gathering, celebrations

etc.)

42

8.2 Proposed Target Audience (Secondary)

8.2.1 Demographics

a) Age

30-40 years old

b) Gender

Male and female

c) Occupation

White collar workers, professionals

d) Income Range


-Professionals income (RM4000- RM7000)

e) Race & Ethnicity


f) Geographical Location

Urban areas and sub-urban

43


a) Perception

• Enjoy having dessert treat by themselves or accompanied by others.

b) Learning



• Reviews from print ads in magazine,newspaper etc.

• Recommendation by colleagues,friends.


• Ways of releasing stress from hard work.

• Trying new types of flavours/food for own’s satisfaction.


• Outgoing,Sociable

• Hardworking,Focused

e) Lifestyle

• Active life routine and may experienced stressful moments due to working life but

knows how to deal with it.

• Attend various events such as weddings, corporate events, birthdays etc.

• Enjoy having quality time with friends and families.

44

Chapter 9 – Market Observation

__________________________________________________

9.1 Marketplace Research

9.1.1 Outlet Visit

I took the opportunity of visiting Cupcake Chic’s outlet at The Curve, Damansara to

collect more information about their company. The information such as type of

cupcakes, variety of flavours, packaging and servings, the surrounding feeling and

ambience of the outlet environment has been observed attentively to study the concept

that Cupcake Chic potrayed to their consumers.

Figure 14: Cupcake Chic, The Curve

9.1.2 Outlet Concept

The outlet of Cupcake Chic at The Curve, Damansara is the main outlet owned by the

franchisor/founder of the company, Joanne Ho. The outlet is located at a strategic

location which is one of the shop’s front lots at the Ground Floor of The Curve. Their

café outlet is 750 – 900 square feet, that builds a suitable place for customers to dine-

in,take-away and also do event functions. From what I’ve observed, Cupcake Chic ‘s

customers buy their products when they are in the situation of going back home, and

also about to go shopping inside the shopping mall. There are also customers who

45

prefers finding their personal space at the outlet and also groups of people connecting

with each other while having their own quality time at the outlet.

9.1.3 Product Observation

The products of Cupcake Chic were displayed behind a transparent glass in a

horizontal position. The cupcakes each has their flavours labelled in front of them as

well as the description of the flavour which makes it easy for customers to choose.

According to the menu, there are a total of 24 cupcake flavours with a combination of

12 cupcake flavours that changes daily.

Figure 15: The cupcakes display

Figure 16: Cupcake serving/packaging

46

The cupcake serving depends on the quantity of how much cupcake that you are

buying. As for dine-in, the cupcake will be served on a plate together with a tissue

and a teaspoon. For takeaways, the cupcakes will be placed in a box package

according to the suitable size for the total cupcakes quantity. The packaging design of

the box includes Cupcake Chic’s logo and also their brand’s sticker.

9.2 Market Observation

A market observation was done at the outlet in order to find out the number of

customers that purchase Cupcake Chic’s products in a day between 11am to 7pm.

There are many categories of customers including children, teenagers, families and

also professional workers.

Time 11am – 1 pm 1pm – 3pm 3pm – 5pm 5pm – 7pm No. of Customers visited

10

21

16

24

9.3 Online Survey

An online survey was conducted between 17th July 2012 – 22nd July 2012 with a set

of 20 questions which were put to a survey panel with four categories altogether. The

survey received a total of 150 respondents.

47

9.3.1 Survey Results Part 1: Consumer Profile

39%

61%

Question 1: What is your gender?

Male Female

60% 22%

14%

4%

Question 2: What is your age group?

Malay

Chinese

Indian

Other

48

60% 22%

14%

4%

Question 3: What is your race?

Malay

Chinese

Indian

Other

38%

28%

22%

9%

RM100 -‐ RM500

RM 500 -‐ RM1500

RM1500 -‐ RM 3000

RM3000 and above

Question 4: What is your income/salary?

49

15%

85%

Question 5: Where do you live?

Outside Selangor & Kuala Lumpur

Within Selangor & Kuala Lumpur

50

Part 2: General understanding of cupcakes

Question 7 studies the total percentage of how often consumers eat cupcakes. 31% respondents eat cupcakes once every few months. 25% each for consumers who eat cupcakes several times in a month and once a month. 11% and 5% consumes it several times in a week and once a week respectively.

64%

36%

Question 6: Are you a fan of cupcake?

Yes

No

5%

11%

25%

25%

31%

Once a week

Several times in a week

Once a month

Several times in a month

Once every few months

Question 7: How often do you eat cupcake(s)?

51

Question 8 studies the percentage of which cupcake brand does consumers prefer to eat. The most favourite brand among the respondents is Cupcake Chic with 40% - this shows that the brand is quite well known. The second most favoured brand is Wondermilk with 29%. Other brands which is not stated received 10% whereby 10% and 6% is Cupcake Dazzle and Biso Bake Shop respectively.

40%

29%

6%

3%

10%

12%

Question 8: What is your favourite cupcake brand?

Cupcake Chic

Wondermilk

Bisou Bake Shop

A Taste Boutique

Cupcake Dazzle

Other

52

Question 9 investigates the factors that consumers take into consideration before buying certain cupcakes.Flavours received the highest percentage with 26%.Price range and cupcake design both received 20% each as one of the factors that makes consumers buy cupcakes. Other factors include attractiveness of packaging (11%), brand (11%), ingredients used(10%) and 2% for factors that are not included in the answer selections.

2%

26%

20%

10%

20%

11%

11%

Question 9: What will be the factors that will make

you by certain cupcakes?

Other

Flavours

Price range

Ingredients used

Cupcake design

Attractiveness of packaging

Brand

53

Question 10 shows the percentage of ocassions that consumers buy cupcakes for. The highest ocassion received 33% which is for consumers themselves. This explains that they like to treat themselves with a dessert treat once in a while. Another ocassion received the second highest percentage (22%) which is the ocassion for birthdays. Other ocassions include party snacks (18%), surprise for a special person(15%),wedding gifts(10%) and another 2% for ocassions that are not stated in the list.

22%

10%

33%

18%

15%

2%

Question 10: What occasions do you buy cupcakes

for?

Birthday present

Wedding gifts

For myself

Party snacks

Suprise for special person

Other

54

Question 11 studies the cupcake flavours most favoured by consumers. The total percentage is more than 100% due to the selection of favoured flavours varied by consumers themselves. It is shown that chocolate flavour received the highest percentage of 55%, followed by 49% for vanilla and 35% for red velvet. Other flavours include fruit-based flavours (27%), coffee(13%) and other flavours that are not listed (5%).

5%

55%

27%

35%

13%

49%

Other

Chocolate

Fruit-‐based

Red velvet

Coffee

Vanilla

Question 11: What is your favourite cupcake Klavour?

55

Part 3: Cupcake Chic Brand’s Awareness

Based on Question 12 and 13, 60% respondents have heard of Cupcake Chic and 40% do not know about the brand. According to the percentage, 30% have heard it through digital media – which shows Cupcake Chic’s efforts of online promotions. 25% respondents have heard of Cupcake Chic through recommendation from friends/family and 24% have never heard of the brand. Other than that, 15% and 6% have heard of Cupcake Chic through print media and other sources respectively.

60%

40%

Question 12: Have you heard of Cupcake Chic?

Yes

No

15%

30%

25%

24%

6%

Question 13: If so, how did you hear about it?

Print media (magazines,newspapers etc.)

Digital media ( social network, online ads, blog reviews etc.)

Recommendation from friends/family

Never heard of it

Other

56

Question 14 shows the percentage of description for Cupcake Chic’s products by consumers. The percentage is more than 100% due to consumers choosing more than 1 selection for the answer. It is stated that consumers perception of the products are delicious (30%),expensive(28%)and also having nice design (27%). Other descriptions include the attractive packaging of the products(23%), popular brand (21%), cheap (2%),and 15% have no clue about the products. Another 2% is for the descriptions that are not listed in the answer selections.

2%

30%

23%

2%

27%

21%

15%

28%

Other

Delicious

Attractive packaging

Cheap

Nice design

Popular

I have no clue

Expensive

Question 14: How would you describe the products of

Cupcake Chic?

57

Question 15 analyzes the percentage of dissatisfactions for Cupcake Chic’s products by consumers. The percentage is more than 100% due to consumers choosing more than 1 selection for the answer. It is shown that majorites of consumers are not satisfies with the price range (48%) and also the promotion of Cupcake Chic (41%). Other than that, the dissatisfactions faced by consumers are, less nutrition (18%),flavours/taste (15%), and cupcake design (14%). As for packaging design and other dissatisfactions that are not stated in the answers both received 8% each.

8%

8%

15%

14%

41%

18%

48%

Other

Packaging

Flavours / Taste

Cupcake design

Promotion

Nutrition

Price range

Question 15: What are your main dissatisfactions of

Cupcake Chic?

58

Question 16 investigates whether consumers have heard of Cupcake Chic’s latest products, the Livin’ Large Cupcake. Majorities of consumers answered No(68%) and only 32% answered Yes. Based on Question 17, it is shown that the improvements that consumers want to see are advertising and promotion of Cupcake Chic (65%) and also the expand the number of outlets (46%). Other than that, consumers would like to see improvement on cupcake flavours (27%) and the packaging design (13%).

32%

68%

Question 16: Have you heard of Livin' Large Cupcakes by Cupcake Chic?

Yes

No

65%

27%

46%

13%

Advertisement & Promotion

More `lavours No. of outlets Packaging design

Question 17: If given opportunity, which part of Cupcake Chic do you want to see

improvement on?

59

Question 18 and 19 analyzes the percentage of familiar and unfamiliar customers of Cupcake Chic. 70% familiar customers answered Yes(70%) to return for more Cupcake Chic products while 30% said No. As for unfamiliar customers, 81% said that they would like to try Cupcake Chic products and only 19% said no. This shows that Cupcake Chic is considered as a trusted brand by consumers that will still want to buy or try out their products.

70%

30%

Question 18: From your experience, will you return for more Cupcake Chic products?

(Familiar customers)

Yes

No

81%

19%

Question 19: Based from this, would you try Cupcake Chic products? (Unfamiliar customers)

Yes

No

60

Part 4: Lifestyle Review

According to Question 20, 70% consumers disagreed that the choice of cupcake brand

reflects their lifestyle whereby 30% agreed for the statement. This explains that

majorities of consumers lifestyle when it comes to eating dessert does not depend on

the brand itself but also to their choice of flavours and taste of the products.

9.3.2 Survey Conclusion

From the results of the survey, it is shown that the brand awareness of Cupcake Chic

is still not up to the high level of expectation. Majorities of consumers have

dissatisfation with the price range of the products. Other than that, consumers prefer

Cupcake Chic to improve more on advertising and promotion as well as expand the

number of outlets to other areas outside Selangor. On the good side, a lot of

consumers chooses flavours as the highest factor of whay they buy cupcakes. This

gives Cupcake Chic an opportunity to draw customers attention through their

unfailing promise of varities through cupcake flavours. Promotion for their products

have to be enhanced in order to expand Cupcake Chic as the leading cupcake products

in the future.

30%

70%

Yes

No

Question 20: Does the choice of cupcake brand

reKlects your lifestyle?

61

9.4 Interview

The interview was done through in person dialogue. I had the opportunity to interview

the Product Innovation Chief, Swee San at Cupcake Chic’s booth during the

Franchise International Malaysia Exhibition on the 8th July 2012. I also did an

informational interviewing with Cupcake Chic’s founder, Joanne Ho through e-mail.

Franchise [email protected]

Jul 26 (6 days ago)

to me

Dear Amira Fateha, Thank you for dropping by the Cupcake Chic booth during the Franchise International Malaysia expo a couple weekends ago. Listed below is our company history as you have requested. Cupcake Chic is Malaysia's first premier cupcake specialist bakery, also known as a cupcakery, established in January 2008.We are bringing the popularity of the retail cupcake industry (worth US$6 billion in the US and growing at +35% year on year) from the USA to Malaysia and other parts of Asia Pacific. Our outlets have shown strong double digit growth since 2008 and it is largely due to the versatility of cupcakes. It's not just a dessert like ice cream and donuts to be enjoyed impulsively or with friends/family but perfect also for celebrations large or small such as weddings, corporate events, birthday parties, baby full moon, etc. (we call this Cupcake Chic Occasions). A franchisee profits not only from their retail outlet but from special occasions as well as online sales. This is what makes our franchise opportunity unique. We are not just about cupcakes alone. We are constantly innovating our menu to include macarons, giant-sized cupcakes, biscottis, gourmet espresso coffee as well as cookies, brownies and a breakfast/lunch/dinner menu soon to be launched - all to clearly position the brand as the place and way to celebrate life.We have 3 franchise investment packages. They are Compatto, Medio and Famiglia (each meaning Compact size, Medium size and Family size). The attachment gives a brief explanation of each store type. All a franchisee does is open shop and provide the best customer service to grow your business. Thank you for your interest in our company for your final year project. Best regards, Joanne Ho Managing Director Cupcake Chic Sdn Bhd Email: [email protected] www.cupcakechic.com.my No. 5-1, Jalan PJU 1/3B, Sunwaymas Commercial Centre, 47301, Petaling Jaya, Selangor, Malaysia Tel: +6 03 7886 3006 Fax: +6 03 7880 0962

62

Chapter 10 – Precedent Studies

__________________________________________________

10.1 Advertising Strategy The advertising strategy by Cupcake Chic involved a lot of offers through online

deals and promotion. They often included their latest news, upcoming events and

latest promotion which can be found in their official website and also their Facebook

fanpage which is updated regularly. Their customer database has over 5,000 on email

and also 75,000 on Facebook accurately up to this date.

Figure 17: Promotions for new limited edition flavours

63

Figure 18: Promotions related to events and activities / online deals

64

Figure 19: Promotions for new products

65

Figure 20: Promotions during charity and festive seasons

66

Figure 21: Online news and articles about Cupcake Chic in magazines

67

Figure 22: Newspaper articles about Cupcake Chic

68

Figure 23: Cupcake Chic’s radio and TV interview

69

10.2 Precedent Studies Wondermilk Cuppacakes

Figure 24: Wondermilk Cuppacakes online promotion

70

Bisou Bake Shop

Figure 25: Bisou Bake Shop’s promotions

71

Famous Amos

Figure 26: Famous Amos’s online promotions

72

Secret Recipe

Figure 27: Promotions for Secret Recipe’s products

73

Chapter 11 – References __________________________________________________

1. Cupcake Chic. (2010). Cupcake Chic. Retrieved from http://www.cupcakechic.com.my/new/

2. Cupcake Chic Facebook fanpage. (2009) Retrieved from http://www.facebook.com/CupcakeChic

3. Cupcake Chic Twitter page. (2009) Retrieved from http://twitter.com/thecupcakechic

4. The Star Online. (2009) Food banks - How it works?. Retrieved from

http://thestar.com.my/lifestyle/story.asp?file=%2F2009%2F12%2F20%2Flifefocus%2F5321812&sec=lifefocus

5. Trip Advisor. (ND). Cupcake Chic review. Retrieved from

http://www.tripadvisor.com.my/Restaurant_Review-g298313-d1082725-Reviews-Cupcake_Chic-Petaling_Jaya_Petaling_District_Selangor.html

6. Red Card. (2012). Red Card promotion (Cupcake Chic). Retrieved from

http://redcard.my/restaurant/Cupcake-Chic.php

7. Freda Liu. (2010). Cupcake Chic Interview with BFM89.9. Retrieved from http://bfm.my/assets/files/Open%20For%20Business/2010_01_21_OpenForBusiness_CupcakeChic.mp3

8. Nazirah Ashari. (2011). Bernama Interview - CEO Trivia with Joanne Ho of

Cupcake Chic. Retrieved from http://www.youtube.com/watch?v=l8mUjLzfZdI

9. Ezreena Yahya. (2010). Wedding Guide Asia - Themed Cupcakes from

Cupcake Chic! . Retrieved from http://www.weddingguideasia.com/wed/themed-cupcakes-from-cupcake-chic/

10. Dorothy Fong. (2010). Cupcake Chic New Website. Retrieved from

http://www.idotyou.com/news/cupcake-chic-new-website/

11. S. Nearby. (2012). Demographics of the cupcake bakery. Retrieved from http://sg.shownearby.com/place/The-Cupcake-Bakery/322654/demographics

74

12. Katie Utken. (2012). Movement from cakes to cupcakes. Retrieved from http://hilite.org/archives/22130

13. Paula Pant. (2012). The Icing on the Cupcake. Retrieved from

http://beta.fool.com/paulapant/2012/03/26/icing-cupcake/3115/

14. PRWEB. (2011). Sugar Rush. Retrieved from http://www.prweb.com/releases/2011/10/prweb8885470.htm

15. MIDA. (2012). Industries in Malaysia. Retrieved from

http://www.mida.gov.my/env3/index.php?page=food-industries

16. Emma Gem. (2008). Malaysia’s Cupcakes Directory. Retrieved from http://www2.emmagem.com/2008/04/08/malaysias-online-cupcake-store-directory/

17. Market Watch 2012. Retrieved from

http://www.malaysia.ahk.de/fileadmin/ahk_malaysia/Market_reports/The_Malaysian_Food_Industry.pdf

18. Famous Amos. Retrieved from

http://www.famousamos.com.my/

19. Wondermilk Cuppcakes. Retrieved from http://www.ilovecuppacakes.com/

20. Bisou Bake Shop. Retrieved from http://www.bisou.com.my/

21. Secret Recipe. Retrieved from http://www.secretrecipe.com.my/

22. Food Promotions. (2010). Cupcake Chic Buy 5 free 1. Retrieved from http://www.foodpromotions.com.my/2010/03/cupcake-chic-buy-5-free-1-buy-9-free-3.html

23. Groupsmore. (2010). 50% off Share 1/2 dozen. Retrieved from

http://www.groupsmore.com/cities/selangor/deals/cupcake-chic

24. Groupon. . (2010). 50% off Share 1/2 dozen. Retrieved from http://www.groupon.my/deals/klang-valley-selangor/groupon-my/715890337

75

Chapter 12 – Appendices __________________________________________________ 12.1 Survey Questions Part 1: Consumer Profile 1. What is your gender?

• Female • Male

2. What is your age group?

• 12-17 • 18-23 • 24-29 • 30 and above

3. What is your race?

• Malay • Chinese • Indian • Other: _____________

4. What is your income/salary?

• RM100 - RM500 • RM 500 - RM1500 • RM1500 - RM 3000 • RM3000 and above

5. Where do you live?

• Within Selangor & Kuala Lumpur • Outside Selangor & Kuala Lumpur

76

Part 2: General understanding of cupcakes 6. Are you a fan of cupcake?

• Yes • No

7. How often do you eat cupcake?

• Once in a week • Several times in a week • Once a month • Several times in a month • Once every few months

8. What is your favourite cupcake brand? (You can select more than 1 answer)

• Cupcake Chic • Wondermilk • Bisou Bake Shop • A Taste Boutique • Cupcake Dazzle • Other: _____________

9. What would be the factors that will make you buy certain cupcakes? (You can select more than 1 answer)

• Brand • Flavours • Price range • Ingredients used • Cupcake design • Attractiveness of packaging • Other: _____________

10. What ocassions do you buy cupcakes for? (You can select more than 1 answer)

• Birthday present • Wedding gifts • For myself • Party snacks • Suprise for boyfriend / girlfriend • Other: _____________

77

11. What is your favourite cupcake flavour? (You can select more than 1 answer)

• Vanilla • Chocolate • Fruit-based • Red velvet • Coffee • Other: _____________

Part 3: Cupcake Chic Brand’s Awareness 12. Have you heard of Cupcake Chic before?

• Yes • No

13. How did you hear about it? (You can select more than 1 answer)

• Print media (magazines,newspapers etc.) • Digital media ( social network, online ads, blog reviews etc.) • Recommendation from friends/family • Never heard of it • Other: _____________

14. How would you describe products by Cupcake Chic? (You can select more than 1 answer)

• Expensive • Delicious • Attractive packaging • Cheap • Nice design • Popular • I have no clue • Other: _____________

78

15. What are your main dissatisfactions about Cupcake Chic? (You can select more than 1 answer)

• Price range • Packaging • Flavours / Taste • Cupcake design • Promotion • Nutrition • Other: _____________

16. Have you heard of Livin' Large Cupcakes by Cupcake Chic?

• Yes • No

17. If given opportunity, which part of Cupcake Chic do you want to see improvement on? (You can select more than 1 answer)

• Advertisement & Promotion • More flavours • No. of outlets • Packaging design

18. From your experience, will you return for more Cupcake Chic products? (Familiar customers)

• Yes • No

19. Based from this, would you try Cupcake Chic products? (unfamiliar customers)

• Yes • No

Part 4: Lifestyle Review 20. Does the choice of cupcake reflects your lifestyle?

• Yes • No

TABLE OF CONTENTS No. Title Page

1 Chapter 1: Project Overview 1 1.1 Introduction 1 1.2 Problem Statement and Issue 2 1.3 Objectives and Aim 2 2 Chapter 2: Project Profile 3 2.1 Product Name 3 2.2 Product Classification 3 2.3 Product Characteristics 3 2.4 Product Range 5 2.5 Distribution 11 2.6 Product Life Cycle 12 2.7 The Brand 12 2.8 Brand Image and Implication 13 2.9 Strength and Weakness 13 2.10 Advantages and Disadvantges 14 2.11 Unique Selling Proposition (USP) 14 2.12 Promotional History and Advertising Schedule 14 2.13 Positioning Statement 18 3 Chapter 3: The Company 19 3.1 Company Overview 19 3.2 Business Description 19 3.3 Company History 20 3.4 Key People 21 3.5 Location and Subsidaries 21 3.6 Brand, Major Products and Services 22 3.7 Corporate Vision 23 3.8 Corporate Mission 23 3.9 Company’s Current Promotional Strategy 23 3.10 Product Sales History 24 3.11 Current Marketing Objectiv 24 3.12 Media Expenditure 25 4 Chapter 4: Consumers and Stakeholders 26 4.1 Current Consumer’s Characteristics 26 4.1.1 Demographics 26 4.1.2 Psychographics 27 4.2 Stakeholder’s Characteristics 28 4.2.1 Primary 28 4.2.2 Secondary 28

No. Title Page 5 Chapter 5: The Industry and Marketplace 30 5.1 The Industry 30 5.1.1 Definition of the Industry 30 5.1.2 Shape of the Industry 30 5.1.3 Development of the Industry 31 5.2 The Marketplace 32 5.2.1 Current Condition of the Marketplace 32 5.2.2 Changes in Marketplace 33 6 Chapter 6: Competitive Situation 34 6.1 Direct Competitors 34 6.1.1 Wondermilk Cuppacakes 34 6.1.2 Bisou Bake Shop 35 6.2 Indirect Competitors 36 6.2.1 Famous Amos 36 6.2.2 Secret Recipe 37 7 Chapter 7: SWOT Analysis 38 7.1 Strengths 38 7.2 Weaknesses 38 7.3 Opportunities 39 7.4 Threats 39 8 Chapter 8: Strategic Target Audience 40 8.1 Proposed Target Audience (Primary) 40 8.1.1 Demographics 40 8.1.2 Psychographics 41 8.2 Proposed Target Audience (Secondary) 42 8.2.1 Demographics 42 8.2.2 Psychographics 43 9 Chapter 9: Market Observation 44 9.1 Marketplace Research 44 9.1.1 Outlet Visit 44 9.1.2 Outlet Concept 44 9.1.3 Product Observation 45 9.2 Market Observation 46 9.3 Online Survey 46 9.3.1 Survey Results 47 9.3.2 Survey Conclusion 60 9.4 Interview 61

No. Title Page 10 Chapter 10: Precedent Studies 62 10.1 Advertising Strategy 62 - 68 10.2 Precedent Studies 69 - 72 11 Chapter 11: References 73 - 74 12 Chapter 12: Appendices 75 12.1 Survey Questions 75 - 78

Date post:	01-Nov-2014
Category:	Documents
Upload:	amirafateha
View:	73 times
Download:	6 times

Situation Analysis

Documents