Ben & Jerry’s Marketing Audit Essay

1 Executive SummaryAccording to the American Marketing Association, market is an organizational function and a set of process for creating, communicating and delivering value to customers and for managing customer relationships in ways that acquire the organization and its stakeholders (Kerin, cc5, p.6). I feed completed a marketing audit of Ben & Jerrys Home do, Inc. in the by-line categories Market and dispersal Channels, Manufacturing, Markets and Customers, Competition, Marketing, Objectives, Strategies and Tactics, the 4Ps ( crossroad, determine, promotion, and place), and earn sales. Based on my findings, there atomic number 18 several factors that forget run across a key role in Ben & Jerrys rubbish Cream becoming number iodine in the sparkler solve manufacturing, instead of being ranked, as number 2. They argon as follows Streamlining the contour and names of the codswallop jactitate flavors Increase sales in the non target marketsSell bonus grouch beat in half congius sizesImprove shop imageBen & Jerrys chalk lick currently wisecracks consumers crack-premium frost option flavors that atomic number 18 both unique and quirky. Further much, some of the wackiest flavors were suggested by adults. For example, some of the flavors include, cherry Garcia, puffinessy Monkey, and embonpoint Hubby (www.benjerry.com). As a result of some of the outlandish names, it perplexs difficult for consumers tolerate to figure out why an rubbish cream would be called chunky monkey, and secondly, what does the flavor consist of. later all, Ben & Jerrys target customers are at the superior end of the consumer spending spectrum. Haagen-Daazs most popular crank cream flavor is simply, vanilla. Therefore, perception blend ins a vital marketing concept to attain the number hotshotstatus. Although Ben & Jerrys has been acquired by Unilever, one of the leading forage companies in the world, Haagen Dazs, which has been acquired by Dreyer s has still been fit to pe winrate 42% of the super-premium ice cream market, while Ben & Jerrys penetrated 38%. just, Ben & Jerrys shed been open to have 100% profitability over the last nine years, while decreasing the cost of sales. go into the 20% non-target market would get out revenue to continue to climb upward by becoming more visible. Advertising can be done done supermarket circulars, picture commercials, and radio announcements, and go the super-premium ice promotions such as buy one, get one free or coupons. Thus, customers and profit margins increase. Currently, Ben & Jerrys super-premium ice cream is sold in pint size quantities. Gallon size quantities were only sold to warehouse orderliness stores. Selling the product to the general public in gallon sizes would allow them to infiltrate the family segment of the ice cream industry. Understanding the consumer is a vital tool in successful marketing and sales. However, careful question and planning are necessa ry. Thus, a recommendation is being made for Ben & Jerrys to enter the market of micro-branding a trend that is becoming more successful in the ice cream industry.Micro-branding would allow Ben & Jerrys to quisling with a compatible and recognized national brand to develop an ice cream formulation that delivers a taste experience that is related to the national brands product (www.qffintl.com). Some of the companies that currently co-brand are Cool Brands International/General Mills = Yoplait Frozen Breakfast Bars, Reeses candies and Friendlys Restaurants. Furthermore, foregoing to launching this new bet on, Ben & Jerrys can conduct a survey among loyal customers. Ben & Jerrys Ice Cream is the best illustration of the 80/20 rule. They turn over 80% of the revenues in the target market and 20% in non target markets however, to increase sales and become No.1, they will need to increase sales in non target markets while stimulating demand in target markets.Based on corporate infor mation (www.benjerry.com), Ben & Jerrys Ice Cream evolved when two childhood buddies, Ben Cohen and Jerry Greenfield met in a 1963 7th patsy gym class in Merrick, New York. In 1977, Ben and Jerry move to Vermont and completed a $5 correspondence course in ice cream making. Afterward, a $12,000.00 investment was made, $4,000.00 of it borrowed, and they opened their first Ben and Jerrys home-brewed ice cream scoop shop in a renovated gas station in Burlington, Vermont, on May 5, 1978. The go with has maintained a reputation for producing gourmet ice cream and quick-frozen treats, as well as promotions that foster an image as an independent socially conscious Vermont association. On gilded 3, 2000, Ben and Jerrys were acquired by Unilever, a British-Dutch food company with distribution in 100 countries. This acquisition would allow the Ben & Jerry brand ice cream to cross over into national and international markets. The ice cream was made with fresh Vermont cream and milk, and t he best and biggest chunks of nuts, fruits, candies, and cookies (www.benjerry.com).Currently, Ben & Jerrys sell 18 Mio gallons of ice cream per year, and more than $200 Mio in annual sales worldwide including Europe, the Mideast, and Asia (Kerin, 2006, p.2). This makes them one of the top makers of premium ice cream, matchingrivals Nestls Haagen-Dazs, and Godiva. Some of the first flavors included French Vanilla, Mint with Oreo Cookie, Maple Walnut, Butter Pecan, and dastard(prenominal) Mash. In order to maintain its status as a leader in the premium ice cream industry, new flavors are constantly being marketed, as well as measures to determine what the ice cream consumer wants directly and in the future.The corporate vision is built around three strategic goals ( military commissions) that moderate Ben & Jerrys corporate concept of linked prosperity. These goals are 1. The product mission Become the leading allocator of freshly made theatrical role ice cream, utilizing natural ingredients that do not violate the environment. 2. The economic mission Achieve capital growth for the corporation, the stakeholders, and the employees. 3. The social mission Be a pioneer in creating advanced(a) stage military control practices that make a positive impact on society nationally and internationally.1.2 Market and Distribution ChannelsThe company currently markets flavor ice cream, frozen yoghourt and sorbet in package pints, for sale primarily through four channels1. Supermarkets, and former(a) grocery stores2. whatsis stores3. Retail food outlets and in bulk primarily to restaurants.4. Ben & Jerrys company- confessed franchised scoop shops.Ben & Jerrys Ice Cream currently award their products throughout the United States primarily through independent allocators targeting certain markets including New England, New York, the Mid-Atlantic region, Florida, Texas, the western Coast and selected other major markets, including the Midwest and Denver areas. In 199 9, roughly 77% of the sales of the conjunctions packaged pints were attributed to these target markets (www.benjerry.com). Also, the ice cream products are also avail sufficient in non-target markets in the United States, the United Kingdom, France, Israel, Canada, the Netherlands, Belgium, Japan, Singapore, Peru and Lebanon.1.3 ManufacturingThe company manufactures Ben & Jerrys super premium ice cream and frozen yogurt pints at its plant in Vermont. This plant manufactures Ben & Jerrys ice cream, frozen yogurt, frozen smoothies and sorbet in packaged pints,12oz. and single serve containers at its St. Albans, Vermont plant. However, in 1999, the company shifted the manufacturing of its frozen novelty line of business from a company-owned plant in Springfield, Vermont, to third party co-packers to meliorate the companys competitive position, gross margins and profitability. As a result of this restructuring, the company was able to write-off assets associated with the ice cream n ovelty business, asset impairment charges of other manufacturing assets and costs associated with severance for those employees who do not accept the go withs offer of relocation. The implementation of this manufacturing restructuring program resulted in a pre-tax special charge to earnings of approximately $8.6 Mio in the one-fourth quarter of 1999 that was primarily non-cash. The plan was executed in 2000. Thus, outsourcing its novelty business will enable the association to introduce a wider range of novelty products in future periods.1.4 Markets and CustomersBen & Jerrys ice cream is packaged in pints, quarts, gallons, single serve containers and novelty products primarily through supermarkets, other grocery stores, convenience stores and other retail food outlets. The company markets ice cream, frozen yogurt and sorbet in 2 gallon bulk containers primarily through franchised and company-owned Ben & Jerrys scoop shops, through restaurants and food service accounts, such as stadiums, airports, cafeterias, and hotels. The ice cream is distributed through independent ice cream allocators with some exceptions, only one allocator is appointed for each territory for supermarkets. In most areas, sub-distributors are used to distribute to the smaller classes of trade. Company trucks and other distributors distribute products that are sold in Vermont and upstate New York. In the late 90s, Ben & Jerrys redesigned its distribution network to enable more company control over sales and improve efficiency in the distribution of its products.Under the redesign, Ben & Jerrys increased direct sales calls by its own sales force to all grocery and chain convenience stores and has a network where no distributor of Ben & Jerrys products has a majority percentage of the Companys distribution. In addition, a joint venture of the U.S. ice cream operations of go up and the Pillsbury Company distributes Ben & Jerrys products in specified territories the balance of internal d eliveries are distributed primarily byDreyers Grand Ice Cream. Under the redesign, no single distributor is expected to handle over 40% of Ben & Jerrys distribution, as compared with Dreyers distribution activities accounting for approximately 57% of the companys net sales in 1997 and 1998.1.5 CompetitionThe ability to create modernistic marketing strategies is crucial to a companys competitiveness (Magrath, Allan, 1992, p.1). Competition in the premium ice cream industry is fierce. Initially, Nestle, Dreyers, and Blue Bell were Ben & Jerrys top three top competitors. In July of 2003, Nestle merged its operations with Dreyers, which makes Edys and Haagen-Dazs ice cream (www.dreamery.com). Other significant competitors are Columbo, Healthy Choice, and Starbucks, which are all distributed by Dreyers. According to research, Haagen- Dazs uses several approaches to keep the status of being number one in the ice cream industry, and they are as follows a. Substantial visibility in more fo reign markets than Ben & Jerrys. b. more shares of the markets.c. Cookies and candies are used as a part of the ingredients. In addition to competing with the number one competitor, Dreyer/Nestle, Ben & Jerrys also has to face competition from other players including Berkeley FarmsBlue BellCoolBrandsDunkinFriendly Ice CreamGiffordsSchwans(Competitors contd)Stewarts ShopsStonyfield FarmYoCream2 MarketingBen and Jerrys Ice-cream introduced themselves to the marketplace as uncommon and comical, with the hopes of appealing to the ice cream lovers sense of humor. Thus, allowing them to acquire a loyal following. However, umteen adultconsumers did not find their advertising funny, as a result market research revealed confusion. Although the encase of the ice cream was amusing, patrons were often trying to figure out why a company, that wants to sell premium ice-cream, would come up with an ice cream flavor such as Chunky Monkey and Chubby Hubby. The playful encase was viewed as being too juvenile to necessitate its luxury price. In 1998, the company re-launched its entire pint line.The design of the ice cream packaging was changed to a more thin grown up design utilizing collages of illustrations, photography and textures. The polished grown up designs cleared the confusion, strengthened the brand, and matched the quality of the ice cream. A superb premium look accompanied the price, and was created without forfeiting the trademark Ben & Jerrys eccentricity (www.fitch.com). Changing the packaging design helped the company to be taken more serious by the premium ice cream consumer market. To sustain their brand and marketing strategy, Ben & Jerry make sure all marketing activities are aimed at edifice brand equity, a solid reputation for the company, and most importantly, profitable customer relationship. The companys marketing strategy includes1. Emphasizing the high quality, natural ingredients in its products. 2. Highlighting commitment to social change th rough innovative promotional and advertising campaigns facilitating brand awareness through Public Relations, pickups, radio, TV coverage, and the internet. The company now distributes its ice cream products internationally in the United Kingdom, Israel, certain parts of Japan, Ireland, France, Canada, the Netherlands, Belgium, Singapore, Peru, and Lebanon. Furthermore, all of the scoop shops are franchised, which contributes significantly to the growth of the brand. 2.1 Objectives, Strategies and TacticsCompetition in the premium ice cream industry is fierce. The companys two principal competitors are the Haagen-Dazs operation of Ice Cream Partners and Dreyers/Edys, which introduced Dreamery. Other significant frozen dessert competitors are Columbo, Healthy Choice and Starbucks. Haagen-Dazs is the industry leader with 42% of the super-premium business, and No.2 Ben & Jerrys, with 38 percent (Emert, Carol, San Francisco Chronicle,p.1)however Ben and Jerry are looking at becoming No 1 and the 4Ps compendium below illustrate how they want to achieve that goal. 2.2 4Ps ProductThe packaged ice cream industry includes economy, regular, premium, premium asset and super premium products. Super premium ice cream is generally characterized by a greater richness and density than other kinds of ice cream. This higher quality ice cream generally costs more than other kinds and is usually marketed by emphasizing quality, flavor selection, texture and brand image. Other types of ice cream are largely marketed on the basis of price (www.benjerry.com). Ben & Jerrys homespun makes its products at facilities in Vermont. They make over 40 different Super-premium Ice Cream flavors (www.hoovers.com)Super-premium Flavors monkey bruiseButter PecanCherry Garcia coffee berry Chip Cookie DoughChocolate Fudge BrownieChocolate TherapyChubby HubbyChunky MonkeyCoffeeCoffee Heath Bar toilDave Matthews Brand Magic BrowniesDublin MudslideEverything But TheFudge CentralFossil FuelHalf b akedIn A CrunchKaramel SutraMartha Martha MarshmallowMint Chocolate CookieNew York Super Fudge ChunkPeanut Butter Me UpPhish FoodUncanny CashewWichFrozen YogurtCherry Garcia (low- make out)Chocolate Fudge BrownieHalf BakedPhish FoodSuper bonus Ice Cream, Super Premium Frozen Yogurt, and more recently, Super Premium Sorbet have become an important part of the frozen dessert industry reaching $3.5 billion in annual ice cream sales (Emert, Carol, p.1) Super premium ice cream is the fastest growing segment in the ice cream industry. gross revenue in the low-card ice cream market skyrocketed to close to $76 Mio in January of 2005. Research shows, 66% of cabbage conscious consumers are seeking low fat products (www.qffintl.com). In response to the demand for lower fat and lower cholesterol products, Ben & Jerrys introduced its own super premium low fat frozen yogurt and lactose-free and cholesterol-free sorbet, as well as a new line of low fat ice cream.2.3 priceBased on information pro vided by Information Resources, Inc., a software and marketing information work company, the total annual U.S. sales in supermarkets at retail prices of super premium and premium plus ice cream, frozen yogurt and sorbet were approximately $572 Mio in 1999 compared with about $518 Mio in 1998. During the 2001-2003 period sales grew by 11.6% In 2004, sales were approximately $260 Mio, and 2004 sales were $272 Mio. Ben and Jerrys product is considered an affordable luxury because of the high quality and quantity of the ingredients. However, individual retailers set their own retail pricing. A reflection of the variation of pricing depends on local market conditions, as illustrated in the table below.Retail/Grocery StoreConvenience storePathmarkShopriteWaWaCVSBen & Jerry$3.89$3.79$3.99$3.69Dreyer/Haagen-Dazs$4.19$3.99$4.29$3.892.4 PlaceCompetition and consumer demand are increasing in the premium ice cream industry. Because of limited ledge space within supermarkets, visibility becomes minimal for many ice cream manufacturers. As a result, some brands have been forced out of some markets. In most supermarkets that were visited, Ben & Jerrys have their own section of shelf space to advertise there product. This is done by having their product publicize in a separate freezer space. In markets where they do not have their own shelf space, they tend to use a seasonal adjustment strategy.2.5 PromotionBen & Jerrys use community familiarity to advertise their ice cream. The company hosts a yearly folk festival which has about 50,000+ attendees. Free bevels are given away at this annual event. In addition, the company has guided tours of its facility in Vermont. This is a non-traditional marketing approach. Currently, the company does not advertise in retail papers, nor dothey solicit buyers in television ads. As a result, it is difficult to quantify investment and return on investment (ROI). However, being able to double profit within five years illustrates Ben & Je rrys ability to successfully market and bait sales.2.6 SalesCohen and Greenfield began packing the ice cream in pints for sale in local grocery stores in 1980. The first franchise followed in 1981. The company earned national exposure that year when Time magazine hailed their product as the best ice cream in the world. After opening its first out-of-state franchise in Maine in 1983, Ben & Jerrys Homemade first went public in a Vermont-only stock offering (to keep ownership local) in 1984. Sales that year surpassed $4 Mio. The fat-free mania of the 1990s prompted the ice-cream manufacturing business to introduce frozen yogurt nationally in 1992 and nonfat frozen yogurt in 1995. blind drunk competition and plant expansion in 1994 caused Ben & Jerrys to suffer its first-ever loss. In 2000, Unilever acquired the company for about $326 Mio. Since its buy of Ben & Jerrys, Unilever has not fully integrated the company into its freezer-full of North American ice cream brands.However the promote has plans to boost the brand into its global portfolio. While most Ben & Jerrys is exported from Vermont, limited production of the product has begun in Europe. Since its purchase of Ben & Jerrys, Unilever has not fully integrated the company into its freezer-full of North American ice cream brands. However the parent has plans to boost the brand into its global portfolio. While most Ben & Jerrys is exported from Vermont, limited production of the product has begun in Europe. After a slow spell in its retail growth, Ben & Jerrys has announced it will step up store openings around the US. To share the cost of nabbing prime retail locations, the company is partnering with its Vermont neighbor Green Mountain Coffee Roasters to add coffee and pastries to its SCOOP SHOP menu and hopefully lean sales into times of the day when people arent typically eating ice cream.An analysis of net sales for the last 9 years reflects a significant growth that is a result of A better market p enetration.A reduction of cost of sales throughout the years (operational efficiency, improved sales and marketing) Improved gross profit over the years (reflects increased efficiency) In fact, based on the in a higher place analysis, Ben & Jerrys are in a position to beat out their number one competitors, Dreyers and Nestle.3 RecommendationsBased on the findings in conducting a Marketing Audit for Ben & Jerrys Super-Premium Ice Cream, Ben & Jerrys Ice Cream is the best example of how to turn a dream into a successful business venture. In fact, they have achieved the No.2 player in the Super- Premium Ice Cream market. Their next goal is to become No.1. To achieve their goal, Ben & Jerrys have to address the following issues that were identified in the Marketing Audit They have to stream line the variety of flavors.In fact, the current offering tends to confuse the consumer especially given the associated luxury price tag. They have to increase sales in the non target markets by in creased marketing as an effort to become more visible to consumers. Sample marketing and advertising channels include television commercials, supermarket circulars, and radio advertisements. In fact, Ben & Jerrys Ice Cream is the best illustration of the 80/20 rule. They achieve 80% of the revenues in the target market and 20% in non target markets however, to increase sales and become No.1, they will need to increase sales in non target markets while stimulating demand in target markets.ReferencesAnonymous. Ben & Jerrys 10-405K Report. Retrieved December 28, 2005, from http//www.benjerry.com/our company/research library/fin/1999/10k.html. Anonymous. Ben & Jerrys 10-405K Report. Retreived December 28, 2005, from http//www.benjerry.com/our company/press_center/press/press_release.cfm. Anonymous. Packaging, Brand Communications and Consumer Environment. Retrieved from http//www.fitvh.com/case-studyAnonymous. (2005).USA summer ice cream scene Novelties, Co-Branding and Something for Ev eryone. Retrieved December 28, 2005 from http//www/qffintl.com/pdf/july_2005/95.cfmChevron, J, (1998). The Delphi sour Strategic Branding Methodology, (15)3, 1-2. Retrieved December 28, 2005 from http//www.jrcanda.com?art_delphi.html Emert, Carol. (1999). Dreyers enters the cold war. New Dreamery line is going cone to cone with HaagenDazs and Ben & Jerrys. Retrieved January 10, 2006, from http//www/sfgate.com/cgi-bin/article.cgiKerin, Roger, Hartley, Steven.(2005) Marketing. Eighth, Retrieved December 5, 2005 from University of Phoenix databaseMagrath, A. (1992). Six pathways to marketing innovation. Business & Company. Resource Center. Retrieved December 10, 2005 from http//galenet.galegroup.com Murray, B. Ben & Jerrys homemade inc. Hoovers A D&B Company. Retrieved December 12, 2005, from http//www.hoovers.com