Godiva Chocolatier is a manufacturer of premium chocolates and related products. Godiva, founded in Belgium in 1926, was purchased by the Turkish Y? ld? z Holding, owner of the Ulker Group, on November 20, 2007. Godiva owns and operates more than 600 retail boutiques and shops in the United States, Canada, Europe, and Asia and is available via over 10,000 specialty retailers. In fall 2009, the chocolatier decided to go mass market and introduced a lower-priced line named “Godiva Gems,” intended to help consumers perceive the premium Godiva brand as more affordable or accessible.
This action is discussed a lot in business environment that many articles were written about the Gems and its effects of brand reputation. This article was also to identify the Gems’ possible effects on the brand. Below you will see the questions that we have tried to answer regarding the article. 1. Identify the product offered by Godiva. Identify the different levels of the product. Discuss the attempts made by the management to come up with an augmented product. The product offered by Godiva is an affordable and accessible one that is made for everyday sharing.
Godiva product available worldwide in over 80 countries around the world, operates in 450 shops and the product over 10000 other retailers. Therefore, it makes easier for consumer to obtain the products. Godiva introduced Godiva Gems at mass market with lower price to reach high level of target market. It is perfect for the customer to gain high quality chocolates at affordable prices. Consumers also can purchase Gems bag as low as $4 for a range of 12 to 18 chocolates or $9. 99 for a bag of 20 to 29 chocolates. There are three levels of the production: The core of the product
Represents the benefit of this product, the benefit that makes it valuable to its consumer, in this case the reputation of Godiva Chocolatier (high end brand) The actual product Is ‘’Godiva Gems’’, the tangible, physical good. The augmented product The non-physical part of it, is the fact that it makes a premium quality brand available in supermarkets at a lower price and the fact that it is accessible for everyday consumption. 2. Do you think that Godiva brand could be damaged after the introduction of the new product to the lower end of the market? Do you see any risks of cannibalization of this line extension for the existing product line?
Why or why not? Explain. The Godiva brand will be damaged by ‘’Godiva Gems’’ because the marketing environment has changed and adjustment was called for. The 80 years old reputation of Godiva is well established and it cannot be lowered by the launch of its low-end product. Also, as the consumer behavior changed because of the unstable economy so did Godiva had to change with it. Godiva forecast will be in 2000 supermarkets by year. There might be a small risk of cannibalization of this line for the existing product line, but if this occurs it can be used as a strategy to capture a larger market of a different market segment.
The risking of the Godiva brand in consumer’s mind. Goldman reported that the company is not compromising the quality of its chocolates. 3. Is Godiva Gems an international or a global product/brand? Discuss whether the brand holds global brand characteristics? It holds global brand characteristics because it is Available across multiple countries Using identical strategies such as principles, positioning and marketing Carrying same brand and logo Implementing various marketing mix in different countries 4. What are the possible impacts of the country origin and packaging in motivating consumers to purchase Godiva chocolates?
In luxury industry, clients value the quality of the products and the brand the most. Being produced and packaged in Turkey may alter the image of the brand so consumers may tend to stop buying Godiva chocolates. 5. Godiva is entering new markets like China and Turkey. What strategy would you offer to the company in its global product planning decisions in terms of standardization versus adaptation? Godiva should not change its strategy because if consumers trust in the Godiva brand, they would not be looking for other chocolate brands.
Hence, they have to improve their strategy to attract more global customer regarding market entry, creation of new market, product specialization, culture, etc. Standardization: We don’t really believe in the standardization of Godiva products. If we do the standardization, the expansion of Godiva products would stopped. It’s because we adapt the Godiva product by the market. We have special products of Godiva of each market we enter and it couldn’t be standardized. For example, Turkish people like peanuts so we adapt it with the chocolate with more peanuts in Turkey.
Chinese people don’t really like milk, so we adapt the product specialization with less milk in the Godiva chocolates for China market. Adaptation: Adapting the products in China and Turkey those should be taken into consideration: Business culture Celebration of important days Food style that really enjoy deserts ( like sweet things ) Adaptation of Chinese and Turkish lifestyles Create the diet chocolates so it will attract more girl teenagers to consume Godiva. May constitute more advertisement that show their lifestyle with consumption of Godiva.