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Marketing Consumer Behavior Project

Team Members:

Daniel Trentadue

5199989

Gurjot Romana

5296660

Christoph Meier

6130181

Sebastien Francotte

6137616

Simon Lombard

6130298

University:

Brock University

Module:

MKTG 2P31

Professor:

Antonia Mantonakis

Date:

Monday, December 5, 2016

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Table of Contents
EXECUTIVE SUMMARY........................................................................................................3
PART A BETTER TITLE....................................................................................................4
PART B SURVEY RESULTS AND RECOM........................................................................7
PART C....................................................................................................................................10
SUMMARY AND CONCLUSION.........................................................................................11
REFERENCES.........................................................................................................................13
APPENDIX..............................................................................................................................14

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Executive summary
The pet food industry can be a rather competitive industry and it is difficult for new
smaller businesses to break into this market and be successful. The larger more established
competitors make it hard for new companies to be noticed or chosen by the consumer.
However, the pet food market as a whole is prosperous and provides potential to generate a
lot of money for any business that can make their way into the market.
Leendert Bolle is the founder of three separate pet related businesses; Hero Dog
Treats, Troop Pet Products and Loyalty Dog Treats. All of these brands are less than a few
years old with Loyalty Dog Treats being created less than a month ago. While these
businesses are all relatively new they have been surprisingly successful considering the small
amount of advertising and promotion done so far. The main focus will be on Loyalty Dog
Treats for this report.
Loyalty dog Treats is a very new business and unlike Mr. Bolles other businesses
Loyalty is offered exclusively online. While Mr. Bolle has some experience putting his other
brands online Loyalty Dog Treats is different. Loyalty is Mr. Bolles first business that
focuses on the B2C market as opposed to B2B. With his limited experience in marketing and
small social media presence it may be more difficult in the consumer market then Mr. Bolle
had expected. At first glance it would appear that this business is doing well considering the
small amount of marketing that Mr. Bolle has done so far. However, Mr. Bolle needs more
knowledge about who is buying his product and why they are buying it, in order to better
understand how the consumer market differs from the business market.
When taking a closer look at the consumer market we made several discoveries that
can help the business. We conducted primary research through an online survey sent through
Facebook. The survey gave us valuable information about demographics as well as customer
motivation. We also learned about consumers opinions when it comes to online shopping
compared to in the store. What we found on the demographics will make marketing efforts
easier in the future. Mr. Bolle can now focus on his target market and reach them more
efficiently. We also discovered that most consumers need to be motivated in order to shop
online. We recommend that Mr. Bolle lower his free shipping after $75 to $40. Also we
believe a subscription or online membership would help motivate consumers to purchase
online as opposed to going to the store and increase their loyalty.
With any big business decisions, there are bound to be risks involved, however, they
are minimal in our case. There are no risks in terms of demographics, knowing more about
your customer and how to market to them can only help the business. The online membership
also provides minimal risk; it would cost nothing to create and would not hurt the business if
unsuccessful. The shipping recommendation has the highest associated risk, it would only be
worth it if more customers bought online as a result. However even if it fails the cost would
be minimal to the business.

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Part A Better Title
Hero Dog Treats (HDT) is a fairly successful brand of dehydrated dog treats, with
their products being carried in hundreds of stores across Canada. Their brand is based on their
treats being high quality single ingredient products. HDT also has a fairly successful sub
brand called Troop Dog Treats, which are sold in Bulk Barn for far cheaper prices than those
of HDT products. This is because the customers for HDT do not want the product being sold
elsewhere for much cheaper. HDT is now in the process of launching its third brand, Loyalty
Dog Treats. This brand will be offering consumers the same great products but at a cheaper
price, but similarly to troop the brand cannot sell these products as HDT at cheaper rates than
the stores. Thus, they have created a new brand to sell to the same people who currently buy
their products but through an online medium.
The problem that stems from this is that HDT have a large market that they already
appeal to that likes their product but they cannot reach out to them because they need to keep
the brands separate. This sets up the problem of trying to figure out who the customer is and
what the best techniques would be for reaching them.
To this point the company has invested a minimal amount of resources into marketing
as they have done almost all their sales directly to other businesses like retailers and
wholesalers who then sell the products themselves. Most of this success has come from word
of mouth recommendations and personal selling. Thus, HDT has never needed a marketing or
communications plan and do not have either in place. They do not have a clear idea of what
type of people are buying their product or why they are buying it. The goal is to learn what
types of people are buying HDT so that they can target them with their new online business.
As this is their first foray in to business to consumer sales they want to know who to sell to
and what the best way to reach out to them would be.

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Beyond this initial goal of determining who the existing customer is in hopes of
targeting them with marketing for the new organization would be to create awareness for the
brand so that there is a market beyond the current customer base.
The benefit to HDT is that they have much better margins selling directly to
consumers. It would also be beneficial to consumers because buying direct from the
manufacturer is much cheaper because there are no intermediaries making money on each
sale. The downside to launching a new brand is that they need to cultivate a new brand image
and create a consumer base. Without a solid understanding of who to target marketing can be
very costly. Therefore, determining who the existing market for HDT is important for the
success of Loyalty since it is likely that people who buy HDT would likely be the same ones
that would be interested in Loyalty.
Currently HDT does not have a very large online presence. This suggests that
management at this point has not done a very good job of learning how to leverage social
media and other online platforms to their advantage. This is shown by the low number of
likes on their Facebook page, at roughly 1400 likes and 1200 Twitter followers. These
numbers suggest that they have not done enough to let consumers know about their online
feeds, or do not do enough to entice them to go on their pages. This should likely be easily
fixed as management has come up with some creative ideas for their social media. In the past
they have uploaded pictures of customers dogs to their social media feed which shows that
there is an attempt to connect with fans. For Loyalty they have taken this to the online store
as well as they have begun an initiative to feature customers dogs eating the treats on their
web page. In our opinion this is a great move as it creates a connection with customers and
will likely lead to customers sharing the posts and products with their friends. This creates a
source appeal as people will likely click a link shared by people they know, even if they
would not have normally clicked it.

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Although it is important for the brand to discover what types of consumers buy their
product online it may not be best to take that as the only route to reaching customers as there
are differences between customers who buy products in store vs online. This will be
discussed in depth later in the report.
Currently managements plan is to take the demographics information which will be
gathered on the brand and use it to target potential customers via Facebook marketing.
Management has decided to take this route for promoting the new brand because in the past
they had tried product samples with codes attached and there was a very low response rate for
a high cost. This time around the plan is to target the key demographic via Facebook during a
trade show.
As stated above management has never needed to directly market to consumers, so
they do not have a clear idea of who the customer is. It is their belief that the customers are
people who value high quality products for their dogs that are reasonably priced. They also
believe that people buy their product because it is comparable to more expensive brands
while being cheaper. The belief is that the customers for Loyalty will be similar customers
who are looking for high quality products that they can feed their dog at a reasonable price.

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Part B Survey results and recom.
This part of the report will focus on solution of the problems discovered in the
previous part and will include our recommendations. The first section will focus on the
survey conducted by our team to uncover Loyaltys clients demographics as well as their
attitude towards buying dog treats online addressing one key issue of the management. The
survey consists of 25 responses and the complete survey can be found in the Appendix part of
this report, arguments made with the help of the survey will be referenced to the according
question. The second section of this part consists of recommendations to enhance Loyaltys
social media presence with several marketing approaches.
In Part A we discovered that one of the managements key concerns was to determine a
clearer picture about their target customer. For this reason, we conducted a survey which was
uploaded to the Facebook page of Loyalty Dog Treats. With the help of the responses an idea
of the target customer demographics can be compiled. The main age cohort of the responses
(48%/n12) was between 31-50 (see Appendix B: Survey question Age) and the number of
people living in a household is mostly 2 with a 56% response rate (see Appendix C: Survey
question Household). This also explains that most households in our survey have no
children (see Appendix D: Survey Question Children). The majority of respondents
(41.7%/n10) earn a salary from $35,001 - $65,000 (see Appendix F: Survey question
Salary) and also own more than one dog with a surprisingly high number of 60% or 15
individuals (see Appendix G: Survey question Dogs). Furthermore, the main size of the
dogs owned by our respondents is large (52%/n13) which is a positive aspect as those dog
need more food (see Appendix H: Survey question Dog size). As a result, our identified
target customers for Loyalty are consumers within the age of 31-50 living in two people
households. We can assume that those people are settled in at their current place and are
parents with kids who have moved out already. Our target clients have an income of $35,000

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- $65,000 which they spend on their several large dogs. This data can be used to tailor any
social media posts to address this group of customers as well as in future advertisement
campaigns.
In order to further improve future advertisement campaigns we wanted to find out
why customers are buying online and not in a store environment. Two main motivations were
found in our research, the Hedonic and the Utilitarian approach (Yoast, 2016). In other words,
the Hedonic approach is a more emotional and builds of factors such as an experience in the
store or the benefit of getting a recommendation from the sales force. Additionally, the client
does not have to wait until receiving the product which is not the case for online shopping,
this is called the instant gratification (business.com, 2015). On the other hand, there is the
Utilitarian approach which is a much more rational motivation in the purchase process. More
precisely, people are more concerned about finding the best deal than having the product right
away. Those clients are looking for ways to compare products with different distributors. As
we figured out in our survey, our respondents (68%) do buy dog treats online (see Appendix
M: Survey question Buying online) and are willing to spend more time to do research, 60%
do conduct up to extensive research, about a product before they consider buying it (see
Appendix L: Survey question Research). This all reflects the arguments made from our
additional research. For this reason, we recommend to keep the website as it is, it offers great
possibilities to compare products with great price-value ratios. In future advertisement
campaigns the focus must be on rational motivated clients within our target segment.
However, we also discovered that some of our clients would not buy online and we
wanted to know the reasons which are holding them back from ordering online. The most
mentioned reasons in our survey were delivery cost (5 responses), delivery time (3 responses)
and payment options (3 responses) (see Appendix N: Survey question Factors for not
buying online). Our recommendations to reduce the number of people not ordering online are

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to decrease the Free Shipping Limit to $40 per order instead of the $75 it is currently at.
This will also be supported by an argument made later on. To address the two other main
problems a subscription plan should be introduced as an order possibility for our clients. In
that way they would exactly know when the products will be delivered to them every month
and further payment option could be made available.
Our last big finding in the survey was about the amount our clients spend on dog
treats every month. About 54.4% of our clients spend $21 - $40 or more on dog treats per
month (see Appendix I: Survey question Spending). This number again supports our
recommendation of decreasing the Free Shipping Limit to $40 per order. We are under the
opinion that this would increase the order volume of a lot of clients by a small amount in
order to reach the limit of $40 where at the same time increasing the order quantity overall.
Now that our survey description gave us an in-depth analysis of our customers, we
know who to target. Therefore, we can provide a specific target for a traditional advertising
campaign through the different classic media channels. The first one will obviously internet.
As we are focusing potential online shoppers, the most preferred canal will be an internet
campaign. Firstly, we want to focused on Facebook through their service Facebook
business. They offer a bidding service that target the most efficiently within their network of
1.4 billion users i. After that, we could use Google with their specific AdWords service.
Once again, it is a pay-per-click fees, so we can freely choose our tariff plan according to the
efficacy of itii. We can also target some specific blogs, as well as dedicated forums, to focus
as precisely as possible our customer segment. In a second phase, we want to reach people
who does not specifically buy online and to try to bring them to LoyaltyDogTreats.com. In
order to do it, we can target some meeting points with our client base. It means distributing
some flyers to dog training centers or canine training competition. According to the budget
considered, we can also try to remove some possible digital barriers. As it can be a problem

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to buy product online if we dont have any real perception of the product considered, we
could distribute some free sample. It will allow a mere exposure effect, which stipulates that
people tend to develop a preference for things that they have been exposed before, and
therefore that they will value it more. By initially holding the product, they will be more
inclined to order it online more. Finally, an opportunity will be to target the print advertising.
Its more expensive but it could, once again, reach potential shoppers that may not be really
active online. Although, as our research has documented, that could be more expensive - for
example, the smallest ad placement in the Modern dog magazine starts at $160 per monthiii.
Additionally, as our survey as clearly highlighted, our customers are likely to try a
new brand. If it is obviously a great asset in order to enlarge our customers base, it can also
be a double edge sword as our existent customers could be tented to change for another
brand. To tackle this potential issue, we suggest some ideas. The first one will be to foster
their loyalty by changing the reward program. Scientific research concluded that in order to
retain users, the most efficient way is on a variable-ratio reinforcement base. Hence, a
random lottery could be made. After each order, the customer will have a chance to take part
in it. Everyone should be winning but within the small prices, one big jackpot could ensure
them to go back on our website. Then, we suggest to create a subscription planning. This idea
consists of providing a monthly delivery of a bundle of our product. Customers will be
allowed to subscribe to a monthly delivery. The bundle will be tailor-made regarding the
number of dogs and their sizes. Customer will have two choices the first one will be to
receive different products each month, in accordance with the proposals of the Company; the
other one will be to have the opportunity to compose their own bundle, from the start or after
receiving a bundle that they liked. It will allow our customers to stay in our company, as our
monthly plan will be a commitment that could create a stronger customer retention. Also, we
developed it earlier, some customers might be reluctant to shop online because of delivery

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concerns. By joining this programs, we will delete these concerns by promising them an on
time delivery. The main idea is to remove the potential buying barriers by making
transactions easier. Added to that, some people does not want of buy online also because they
are reluctant to the payment costs occurred when buying online. We are conscious of this
potential treat, and to alleviate this burden we suggest to reduce the free shipping limit. If
currently this amount is $75, we strongly believe that reducing it to $40 will foster the
general amount of orders.
Finally, we are convinced that a simple maneuver can be used to foster orders on our
website. In fact, as the Decoy effect has proved, adding a third option to the preliminary
choices presented can be an important factor of decision for the shoppers. The idea is to
provide a third absurd choice to redirect them unconsciously to the offer choose
beforehand. Concretely, when ordering on the website, in the deals section we can add an
option 8 bags at -12% to increase the consumption of the 10 bags at -20%.
In the next part we will discuss the according risk to our recommendations explained
in this part.

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Part C
As mentioned in the previous part, our main recommendations are dealing with the
possibility to make our online customers perform higher purchases (subscription plan or
lower free shipping limit) and to increase the brand popularity as well as the brand image. As
Loyalty treats are not a perishable product and since most of the people buy online because it
is more convenient we think that we really have to encourage Loyalty customers to make big
purchases on the website.
In our opinion our recommendations are really feasible and the risks are minors. All
will depend of the budget we are ready to allocate for this expenditures. Most of them are free
or cheap. For instance, most of advertising means we proposed are free like Facebook,
Google optimization, Forums, Blogs. Others like advertisement in magazines or dog school
are paying solution; so the first risk with those solutions is to don't get your Return On
Investment, that is to say that having your add in a magazine is more expansive that what it
will make you earn. But this risk will be quite difficult to identify because it is hard to know
how many new customers an ad in a magazine has brought.
The second major risk could be a brand overlap risk. It is possible that the creation of
the online Loyalty Treats and all the efforts we will make to make it competitive will attract
no new customers but only or almost only former HDT customers. So Loyalty growth would
increase at the expense of HDT.
The last risk we identified is a customer irritation risk if Loyalty is too present on
very media (online, in life, in printed advertising) consumers could be annoyed but in our
opinion this risk is very low. If we had to rank them we would put brand overlap as the main
risk even if it is still moderate but online buying is more and more common we would say it
is the first risk. The second would be the no ROI risk. It is low because most of the
recommendations we gave are relatively cheap. Finally the thrid one would be the customer

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irritation risk which is very low in our opinion because Loyalty is a new brand so it has to be
known and none of our advertisement recommendations are intrusive.
Summary and conclusion
Loyalty Dog Treats is a new business trying to break into a very competitive market.
While it can be difficult to establish a new brand in this market Leendert Bolle has proven
with his previous businesses that he understands this market. Loyalty Dog Treats competitive
advantage comes from their high quality product that consumers can feel good about giving
their dogs. Also Loyalty comes at a competitive price compared to the more recognizable
brands. Which allows consumers to switch brands and start getting premium treats without
breaking the bank.
Leendert needs to do more to better understand who his customer is and why they are
buying his products. This report has been the first step in that process and will help him begin
to narrow his target market. This will improve his overall marketing effort and contribute to
brand awareness in the long run.
Getting consumers to switch their shopping habits can be very difficult. Especially
when trying to get them to change something as fundamental as shopping online instead of
in-store. Leendert needs to incentivize the customers in order to shop online for Loyalty
products. Our report discussed some possible ways to do this, which should not only increase
online shopping but also return customers. Luckily the risk for these initiatives is minimal
which should allow Leendert to try them out without fear of negatively affecting the brand.
Loyalty Dog Treats is a good brand that has been built very well from the ground up.
However, the success Leendert has had up to this point will eventually fade if he does not
make an effort to increase brand awareness. Leendert has many options to continue the
success of his businesses and will likely continue to expand into a recognizable brand.

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References
https://www.facebook.com/business/learn/how-much-facebook-ads-cost/
https://www.google.ca/adwords/

http://moderndogmagazine.com/advertise

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Appendix

Appendix A: Survey question - Gender (n24)

Appendix B: Survey question - Age (n25)

Appendix C: Survey question Household (n25)

Appendix D: Survey question Children (n25)

Appendix E: Survey question Domicile (n24)

Appendix F: Survey question Salary (n24)

Appendix G: Survey question Dogs (n25)

Appendix H: Survey question Dog size (n25)

Appendix I: Survey question Spending (n24)

Appendix J: Survey question Brand loyalty (n25)

Appendix K: Survey question Dog food aspects (n25)

Appendix L: Survey question Research (n25)

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Appendix M: Survey question Buying online (n25)

Appendix N: Survey question Factors of not buying online (n25)

i https://www.facebook.com/business/learn/how-much-facebook-ads-cost/
ii https://www.google.ca/adwords/
iii http://moderndogmagazine.com/advertise