Company Introduction, Market Segmentation, and Product Positioning Essay
In this assignment we will describe our fictitious company and provide its background. Then we will start building the marketing plan with a focus on segmenting and positioning our product and service. Our company is called ‘The Glazed Doughnut. ’ It started off as a small doughnut shop located in Clemson, South Carolina. Over the course of a few years, the company has grown and expanded and now has stores located throughout South Carolina in Anderson, Greenville, Columbia, and Charleston. We have also now expanded to other states in the southeast area of the United States such as Georgia, Florida, and North Carolina.
We offer a basic line up of simple (glazed) and fancy (glazed with sprinkles, chocolate glazed, chocolate with sprinkles, powdered, and powdered with sprinkles) doughnuts, with an assortment of coffee and other drinks available to the customers. The original store was established in 1999 at Clemson South Carolina. Our mission statement for The Glazed Doughnut is to become the premier doughnut retailer by being in the right place, at the right time, with just the right doughnut.
Our mission statement reflects our key successes of great location and great tasting doughnuts.
We are the premier doughnut retailer by having excellent service and fantastic doughnuts, along with a fun and friendly atmosphere, at a competitive price. With the great success of the company thus far, we are now looking to expand further into other markets. Through marketing research we have found that there is a high growing demand for doughnut shops in international markets in the United Kingdom. If we can successfully expand our doughnut shops into international markets, then we can further increase our revenues while expanding our company image and brand.
This will be a risky move, but with the proper execution it will reap great returns. We first started our business in Clemson SC, and it was considered a place for students to just come and hang out, get a donut and a coffee or other beverage and relax or study for a while. Through marketing research we have found that in the U. K. a lot of their coffee shops incorporate the same type of atmosphere. So by transitioning our similar atmosphere, along with our American style doughnuts and great tasting coffee, we are confident that our products and services will be successful in a new area.
In this next part of the assignment we will discuss the overall marketing plan. First, we will discuss the potential audiences for a marketing plan and the needs of those potential audiences. The potential audiences of The Glazed Doughnut are male and female college students, and males and females with regular day jobs between the ages of 22-29. With doughnuts being our key product, our research shows that many older adults will not find a doughnut as appealing as a younger adult would, so we expect our main audience to be that of younger adults.
One of our main products we sell along with our doughnuts is coffee, and in today’s society a lot of people buy coffee, especially in the morning to help them off to a great start to their day. The potential needs of the audience will be our coffee and doughnuts, and the friendly service and fun atmosphere that we provide. Next, we will identify the marketing segment for the product and provide a rationale for this segment. One of the marketing segments for our product is the Socio-Economic segmentation.
The segment is based in consumer markets because it concentrates on social classes particularly the business class people, and young adults (including college students). This is mainly marketing to those people who are working at the office, or college students who are studying and want to have a doughnut with a cup of coffee, in a great facility with a good atmosphere. Also, we have segmented the market geographically and demographically by selecting our store locations where they can find the educated and doughnut and coffee lovers.
We chose these segments because our products and services that we offer in our doughnut shop are the most attractive to these particular segments, and since we initially started in a college community, we are most experienced with this segment. Next, we will discuss the target market and provide a rationale for this target market. “Target Marketing is a process of evaluating each market segments overall attractiveness and selecting one or more segments to enter” (Kotler and Armstrong, 2006). Our first target market that we have been marketing to already is that of college students (i. e. ales and females between ages 18 – 22). Since we originally started on a college campus, we want to continue to market to them. Also, our other target market is to young adults (males and females 23-29). We chose these target markets specifically for this age group because college students and the young working class find this type of environment inviting and appealing. By adding another market (young adults between ages 23-29), we plan to expand our customer base, and as a result earn more revenue. Next, we will perform a SWOT analysis (strengths, weakness, opportunities, and threats) for the company.
Strengths: • The Glazed Doughnut has a loyal customer base willing to pay premium prices for Glazed doughnut products. • Store location is an important competitive factor, and The Glazed Doughnut has secured its company in many of the most desirable areas for college students and young adults. • Our leadership team is solid, and show improvements in company sales and employee satisfaction. Weaknesses: • Limited amount of “healthy” menu selections. Many of the company’s products have high calories and fat content.
• International differences/preferences. Our coffee products are more expensive than those offered by the competition, and customers could easily switch to lower priced alternatives in times of economic hardship. • Limited Amount of non-snack food items. Opportunities: • International expansion promises great returns if successful. • Ever-increasing percentage of U. S. food dollars has gone to eating out. With a greater percentage of Americans working, there has been less time available for at-home food preparation. • Introducing new products and different distribution venues Threats: McDonald’s is successfully expanding its Mc Cafe stores on a global scale. The fast food giant has lower prices, in addition to a globally recognized brand.
• Dunkin’ Donuts makes 60% system wide sales from coffee and other beverages and the company is expanding beyond its core northeastern U. S. market. • Starbucks owns the most recognizable brand in the specialty coffee business, and has already expanded to the international market. Next, we will create the market position for our product and service and explain our rationale. Positioning involves a product that benefits the target segment of the company and is about identity – who you are in the marketplace vis-a-vis the competition” (Iacobucci, p. 39). The Glazed Doughnut has developed a unique market position for our products because if a product is to be exactly the same like others on the market, then consumers would have no reason to buy our products. We have planned our positioning in such a way that distinguishes our products from competing brands and this gives us a great strategic advantage in our target markets.
Our statement is to become the premier doughnut retailer by being in the right place, at the right time, with just the right doughnut. For our doughnuts price, our initial strategy was a low price and high quality (i. e. Good Value). We were able to achieve that because the ingredients needed to make a high quality tasting doughnut are not expensive. Over the years, now that we have started focusing on coffee as well as one of our main products, our coffee is of high quality, and we charge a somewhat higher price in order to differentiate ourselves from the competition.
Once we developed a loyal customer base, we were able to implement a higher price strategy with our coffee. We will gain a competitive advantage over customer satisfaction and employee satisfaction as we develop our positioning strategy based on the customer. To ensure that we have great service provided by our employees, we want to give our employees the power to participate in the every decision of the business to help make it successful.
From a Human Resources standpoint, we want to make sure we hire friendly and fun type of people so that we can continue to have our culture this way. Finally, for our positioning statement, our company’s statement will be: “Taste Good. Feel Good. ” We want our products to taste good so that our customers will want to keep buying our products, and also we want our customers to feel good. This will result from our products tasting good, and from the great service our employees provide and that our great atmosphere at our locations provide.