Professional Documents
Culture Documents
Group Members:
Executive Summary 4
Marketing Strategy 13
Segmentation 13
Targeting Strategy 16
Positioning & Competitive Advantage Strategy 16
Market Research 23
Methodology 23
Research Results 25
Marketing Objectives 28
Marketing Mix 29
Product 29
Pricing 29
Place 30
Promotion 30
Financials 31
Break-Even Analysis 31
Sales Forecast 31
References 34
Appendices 36
Executive Summary
Ben & Jerrys is a US-based, global ice-cream brand owned by Unilever and founded in
1978. It is currently considered one of the primary market leaders in the US ice cream market,
and has generated significant profits and market share in other worldwide markets. The plan to
introduce Ben & Jerrys ice cream to the Egyptian market underwent a significant level of
research into the macro and micro-environment in order to reach the conclusion that the market
is indeed worth entering and profitable, followed by a SWOT analysis for the endeavour. A gap
was identified in the market, leading to a segmentation strategy targeting A-class children and
families with a positioning strategy focused on fun and togetherness. Extensive primary market
research was carried out in the form of a questionnaire, and results were employed in decisions
relating to decisions relating to the marketing mix, such as the pricing methods and the decision
to distribute the ice cream in high-end supermarkets. A collection of marketing objectives was
compiled in order to set key goals for the following sections, including the financial plans and
the details of implementation and control to ensure the success of the endeavour, such as a goal
to reach 35% market share by the end of Year 1. Ben & Jerrys aims to establish itself as a key
contender in the Egyptian ice cream market, with potential future expansion plans in other
segments, with potential increases to the product mix.
Company Background:
Mission Statement:
Ben & Jerrys is initially dedicated to and is built on the concept of
linked prosperity. The main mission is based on three different aspects
or minor missions, which are created in order to achieve prosperity for
everyone concerned with the buying or the selling of the product including
the suppliers, the customers, the employees and other groups as well. The
three minor missions that are expected to achieve the major mission are:
- Product mission: Concerned with creating, delivering, and to sell
the best possible quality of ice cream using whole and natural
ingredients, as well as developing business strategies that exhibit
respect to the environment and the earth in which we live in.
- Social mission: The company aims to utilize Ben and Jerrys in the
most beneficial approach in order to maximize the quality of the
consumers lives both nationally and internationally.
- Economic mission: Aiming to operate Ben and Jerrys by earning a
continuous amount of profitable growth, that will increase the
growth of the careers of Ben and Jerrys employees, and will
develop further chances for growth and the expansion of the
company.
Historical Performance/Results:
Ben and Jerrys history began in 1978 when Ben Cohen and Jerry
Greenfield invented what is now one of the most successful ice cream
brands worldwide. Ben and Jerry used a renovated gas station to build
their first direct, hard-serve ice cream shop.
In 1980, two years after their opening, Ben and Jerry decided to
rent another shop in a mill for sewing materials due to their previous
success. In 1981, the first franchise for Ben and Jerrys opened in
Shelburne, Vermont, thus reaching more customers in other cities and
increasing the growth of Ben and Jerrys as a small start-up.Throughout
the years, Ben and Jerrys ice cream has been utilized in order to create
the worlds largest ice cream sundae.
A few years later, Ben and Jerrys confirmed that their products are
whole dairy products that do not include harmful hormones such as RBGH
(Recombinant Bovine Growth Hormone). Ben and Jerrys confirmation on
their ice cream being organic caused an immediate increase in the demand
for their ice-cream, as they were also the only ice cream sellers that made
this confirmation. Later on, Ben and Jerrys was introduced in the United
Kingdom and an expansion plan for the United Kingdom was
implemented. Lastly, in 2000, Unilever bought Ben and Jerrys,
globalising the brand and introducing a franchising system with wider
international reach.
It is believed that Ben and Jerrys is currently a cash cow according
to the current state of the ice cream market in The United States. Despite
the fact that the take-home ice cream market is currently stable and is not
increasing, it is expected that the take-home ice cream market will
increase by 2% by 2020. This is beneficial to the brand as it has
successfully established itself in the US market for ice cream, which
predicts the success of further expansion plans.
Environmental Analysis
Microenvironment Analysis:
Competition
Direct Competition:
Nestl is a primary competitor with over 70% value
market share. It operates primarily based on
supermarket and kiosk sales for brands Dolce,
Paradise, and Caramelita.
In 2013, Nestl increased the size of its ice
cream factories to cater to increasing
demand.
Due to increased prices, and a luxury customer
perception, demand for Haagen Dazs ice cream has
fallen significantly.
Haagen Dazs was formerly available in
Gourmet markets, but has been discontinued
for unclear reasons - it is now distributed in
Seoudi supermarkets.
Mvenpick ice cream was purchased by Nestl in
2003.
Due to the perception that Mvenpick ice
cream is a luxury brand with premium
pricing, they have experienced sluggish
sales, despite their decrease in price.
Mvenpicks success stemmed from its
collaborations with cafs and restaurants
(B2B distribution), although this has
experienced a reduction, potentially due to
high costs after increased import costs,
especially considering its already high price.
Mvenpick has altered its primary course
from selling boxes of ice cream in high-end
supermarkets to setting up ice cream cafs in
affluent locations.
Indirect Competition:
Frozen yoghurt brand Yoggys is available in
multiple malls around Cairo, and offers a healthy
yet pleasant-tasting alternative to ice creams.
Pinkberry is also a vendor of frozen yoghurt in
Cairo, although it focuses its promotion primarily
on its international brand name.
Both frozen yoghurt brands are regarded as
expensive compared to standard ice cream options.
Homemade ice cream options are beginning to gain
slow popularity, although the unavailability of
ingredients and time, as well as specialised sellers
for homemade ice cream, has staggered its growth
significantly.
Cold Stone Creamery is a successful chain of ice
cream cafs offering affordable ice cream under an
international brand name. They are often associated
with the shows the servers put on with the ice
cream.
Baskin Robbins is a strong contender in the market
for hard-serve ice cream stands, with 15 branches in
Cairo.
London Dairy ice cream, while available in some
supermarkets, has become a lesser known brand in
Egypt due to lack of availability and promotion, and
does not have a level of market share significant
enough to make it a direct competitor to Ben &
Jerrys.
Stavolta is a relatively new but growing scoop-shop.
While gaining popularity, Stavolta is weakened by
its limited distribution; only presently having three
branches (Sheikh Zayed, Heliopolis, and Maadi) in
exclusive or lesser known areas of each city it
operates in.
Mandarine Koueider, while primarily a vendor of
oriental sweets, also has a niche of customers who
actively seek out its ice cream.
Types of Customers:
Consumers: The general public of young, middle to high
class Egyptians buy ice cream for pleasure.
Businesses: There is an array of cafs and restaurants, such
as Starbucks and others, that collaborate with other brands
for products outside of their specialty. Some of these brands
may include ice cream brands.
Resellers: Large supermarkets, such as Seoudi and
Carrefour, and specialty resellers such as Fresh Food
Market and Gourmet, are known to stock ice cream brands.
While larger supermarkets tend to focus on providing a
wide variety of brands, resellers like Gourmet tend to focus
on one brand that is associated with luxury or is difficult to
find outside of it.
Employees:
Due to the high unemployment rate in Egypt, there is a high
availability of workforce.
Training employees who sell ice cream to consumers is also
not a difficult process, shown in existing examples of
Baskin Robbins and Cold Stone Creamery.
Supply Chain:
Primary suppliers are provided by Ben & Jerrys upon the
establishment of a franchise deal.
Internal transportation is highly accessible in Egypt
considering the high number of qualified large vehicle
drivers.
Customs in Egypt are highly critical of incoming
shipments.
Macro-environment Analysis:
Demographic Trends:
There is an increase in the presence for younger age groups
(0-39 years) in the Egyptian population. (see Appendix Y)
In these age groups, there is a general balance in gender
proportions, with a slight increase in male presence. (see
Appendix Y)
There is a 25-31% increase in house prices in the New
Cairo/5th Settlement area between 2016 and 2017,
suggesting an increase in demand for houses in the area.
There is a large gap in income levels between social classes
in Egypt.
The majority of Egyptians first language is Arabic, with a
relative minority speaking fluent English.
Economic Trends:
There is an economic crisis that has made a significant
portion of Egyptians more cautious in spending, opting for
more stable investments.
The devaluation of the Egyptian pound, coupled with
increased customs costs, has caused an increase in prices
for imported goods.
There is a small but existing increase in economic growth,
with GDP growth reaching 4.3% in 2016. (see Appendix Z)
There is a high unemployment rate of just below 12%.
Unemployment is decreasing in Egypt, although the fall is
very slow and gradual.
Political Trends:
There is a trend of political upheaval in Egypt that may
occupy potential customers thoughts.
The growth of the Israeli-Palestinian conflict in the news,
and Egypts participation in the matter, has made it a key
aspect in Egyptian political conversation.
Technological Trends:
Smartphones are increasingly prevalent, with
telecommunication companies experiencing increasing
levels of demand. Egypt has 103% penetration in mobile
phone services, suggesting that the entire population has
access to basic phone services at least.
Social media is becoming increasingly popular, with
Facebook as the most popular website.
Egyptians spend an average of 4 hours online each day.
Digital literacy is increasing amongst the Egyptian
population.
Cultural/Social Trends:
There is an increase in demand for malls around Egypt,
although this is coupled with demand for a diversified/
unique experience
Egypt is a Muslim, Arab country, suggesting conservatism
towards certain styles of advertising and promotion.
Egypt is becoming increasingly Westernised, idolising
American brands primarily, and mimicking Western trends
where possible.
Despite financial issues, Egyptians are finding ways to
participate in expensive trends (e.g. Apple iPhones) through
instalment plans in partnership banks and telecom
companies, showing a high level of demand for that which
is considered trendy, particularly in the West.
There is an increasing demand for sweet treats around the
country, amongst multiple age groups.
Amongst some members of the Egyptian market, there is
some demand for healthier alternatives to unhealthy foods.
SWOT Analysis
Strengths:
Business: There are a lot of cafes and restaurants collaborate with
ice-cream brands to be served for their customers.
Resellers: Large supermarkets; for instance, Gourmet and Fresh
food market, stock ice-cream brands and they sell it to their
customers.
Employees: Training the employees in the field of ice-cream is an
easy process.
Demographic trends: There is a rising population of the young age
in Egypt.
Product: Ben & Jerrys boasts a wider variety of flavours than any
other competitor around the world, and especially more than
those in Egypt.
Weaknesses:
We are launching a new ice-cream brand which has no experience
in the Egyptian market.
The pricing will be relatively high because it is an imported
product.
Since we are launching new ice-cream brand which is already
launched abroad, there will be no factories here in Egypt.
Opportunities:
Customer: Middle-high class in Egypt buys ice-cream as a dessert.
Supply chain: The accessibility of transportation is an easy process
in Egypt.
Technological trends: Increase in the use of smartphones and
internet which is an easy way to raise awareness for the ice-
cream brand.
Cultural and social trends:
There is an increase in constructing the malls in Egypt, so
there will be availability in cafes, restaurants or shops to
launch the product.
Egyptians are becoming more Westernized
There is an increase in demand for sweet treats in the
Egyptian market.
Competition:
Due the increase in the price of imported goods, the
demand for Haagen Dazs has fallen clearly
Due to the weak promotion for London Dairy ice-cream, the
Egyptians became unfamiliar with it.
Due to the Egyptians' perception that Mvenpick ice-cream
has premium pricing, its sales have been inactive recently.
Mvenpick has launched its own caf to serve their ice-
cream in it and they stopped producing ice-cream boxes.
Threats:
Supply chain: Primary suppliers chain are provided by Ben and
Jerrys upon the establishment of a franchise deal.
Media and general public: One of the owners of Ben and Jerry's is
Jewish and this might be a threat due to the Arab's perception
about Jews and the support of the Egyptians to Palestine in the
Israeli-Palestinian conflict.
Economic:
The economic crisis in Egypt made Egyptians spend less in
the recent period.
The devaluation of the pound caused as increase in the
price of the imported goods.
Conservative society:
If it is not trendy, Egyptians will not be interested in buying
the ice-cream.
People are becoming more health oriented.
Competition:
Nestl shares 70% of the market share of ice-cream, so it is
our first direct competitors.
Baskin Robbins is a strong direct competitor due to its wide
number of branches.
Although Mvenpick collaborated with cafes and
restaurants to serve its ice-cream, its sales have faced
reduction due to the high pricing of imported goods.
Cold Stone is another strong competitor as it has high
quality ice-cream with good prices combined with creative
service in their cafes.
Frozen yoghurt brand Yoggys s spreading in a lot of malls
which serves healthy frozen yogurt for health-oriented
people.
Pinkberry also serves frozen yogurt in Egypt, and its priority
to focus on the promotion and its international brand
name.
Although the unavailability of time and skills of making ice-
cream at home, its growth has raised significantly
1. Marketing Strategy:
Segmentation:
Segmentation Strategy:
In order to determine which customers will be served, Ben and Jerrys does the market
segmentation, targeting and positioning. Ben and Jerrys will also decide the ways it could serve
its customers and deliver not only the product, but also a service. Using the process of market
segmentation, the company can expand by increasing its sales, profit and market share; it will
always aim to fulfill the customers needs as well.
Targeting Strategy:
We merged 4 segments together which are females and males from an A class living in 5th
settlement from the age of 25-40 with the segment females and males from an A class living in
the 5th settlement from the age of 20-25.
We crossed out females and males from B class living in the 5th settlement 25-40 as they
will not afford the price of our ice cream which is relatively high to this specific segment so they
are not actionable and they have substitute products.
We also crossed out teenagers in college as they hang out most of the time in cafes and
we will not be serving our product in restaurants and cafes.
We crossed out children in school as they are not actionable and they are not going to buy
so instead we are going to focus on targeting their parents.
We will keep healthy oriented people as they are actionable since Ben and Jerry's has ice
cream specialized in health-oriented customers and vegans.
We also merged young fathers and mothers with children from an A class together as they
have the same characteristics and the gender in this case is not a major factor.
Our target market will be A-class children and families' because this segment is expected
to grow in the future, they will afford the price of the product which is relatively high, the gender
is not a factor, so we decided to target families. We have put health-oriented people into
consideration; however, we have discovered that if we started by health-oriented as out target
market we will focus on frozen yogurt and dietary ice-cream and Ben and Jerrys is well-known
for its extra-ordinary flavours and taste. So we have put health-oriented people as a future plan.
Also we decided to place our product in the super markets so it will be available for families also
the substitute products in the super markets do not have the variety of flavors in comparison to
Ben and Jerry's .
Positioning:
Perceptual Map (see Appendix A):
Upon breakdown of the main competitors, both
strong and weak, in the market, competitors were
compared based on two factors: Pricing (Affordable
to Premium) and Variety of Flavours (Low Variety
to Wide Variety).
On the perceptual map, direct competitors with
distribution channels in supermarkets were
highlighted in blue. These competitors are
considered a priority due to their sharing of the
same distribution channel as Ben & Jerrys.
Nestl was considered the most affordable due to its
minimal prices. In terms of products under the
brand of Nestl, three were included:
Dolce, its cheapest option
Carnavalita, a more premium option with
higher prices and higher quality.
Paradise: a moderately priced brand of
boxed ice cream with multiple sizes.
Mandarine Koueider, while on a similar pricing
level to Nestl, charges more for its ice cream and
includes a lower variety of flavours, potentially due
to its focus on other desserts as well as ice cream.
Baskin Robbins was regarded as a relatively
affordable brand offering a relatively wide variety
of ice cream flavours.
Stavolta and the Cold Stone Creamery both include
slightly premium prices, with Cold Stone Creamery
exceeding Stavoltas prices by a small degree. Both
brands include a wide variety of flavours, although
this variety does not exceed that of Baskin Robbins.
Both Mvenpick and Hagen-Dazs were considered
to have premium pricing with a generally low
variety of flavours, although the latter included a
wider variety than the former. Hagen-Dazs prices
its single servings (100ml) of ice cream in
supermarkets at 41.50LE, whereas Mvenpick
charges 16.50 EGP for its single serving in
supermarkets.
Competitive Analysis:
Analysis of direct competitors ensues; these competitors distribute
their products through supermarkets and were present in the minds of
questioned respondents for market research.
Nestl:
Products include a wide range of products; all of its
products are characterised by brightly coloured
packaging, and decent quality ice cream. While
quality is not their primary selling point, the
primary focus in the quality is in the notion of value
for money.
Prices are ranged from affordable (Dolce &
Paradise) to slightly higher (Carnavalita). Prices are
highly competitive, potentially due to the presence
of local production and the lack of import costs/
need for foreign currency.
Distribution channels are largely focused on
supermarkets and small kiosks in Egyptian streets.
A push method is primarily applied, with customers
ability to find Nestl ice cream almost anywhere
except premium supermarkets (Gourmet, Fresh
Food Market, etc.)
Promotion was formerly heavy in terms of
television advertising, and has now shifted to sales
promotion (e.g. discounts, promotional offers, etc.).
Strengths:
Extremely wide distribution
Local production enabling lower prices.
Established corporate brand name in other
markets.
Weaknesses:
Relatively low quality to new ice cream
brands.
Lack of availability/key presence in high-
end supermarkets, and some average
supermarkets where many potential
consumers go for grocery shopping (Seoudi,
Alfa, etc.)
Opportunities:
Inflation rates in Egypt make consumers
more likely to opt for cheaper options.
The rise in the cost of foreign currency has
forced competitors to increase their prices.
A continuous increase in the presence of
kiosks and small-scale vendors, offering an
increase in distribution channels for Nestl.
Threats:
A widespread increase in local-production
scoop shops with reasonable prices.
Increase in higher quality ice cream options,
some at reasonable or value for money
prices.
A market-wide trend towards
Westernisation, making local produce seem
unappealing in the eyes of some consumers.
Mvenpick:
Product: Mvenpick ice cream is marketed as being
of extremely high quality. The packaging is
considered to seem elegant, with subtle colours
(black and white, with the only other colour being
the ice cream). Ice cream on the packaging is
presented with some form of garnish or another to
make it seem more fancy.
Price: Prices were formerly excessively high,
however, potentially due to a fall in demand, the
price for a single serving of boxed ice cream has
been reduced to 16.50LE. This is a considerably
reasonable price.
Distribution: Limited to specific supermarkets by
agreement. Distribution has also shifted between
supermarkets as competitors make more appealing
offers (e.g. Seoudi stocked Mvenpick ice cream
and shifted to Hagen-Dazs in terms of premium
offerings.)
Promotion is minimal and advertising is focused
largely on high-end magazines such as Cairo East/
West. Minimal sales promotions, discounts, or
allowances are present.
Strengths:
High quality.
Established reputation and brand name.
Newly reasonable prices.
Weaknesses:
Because Mvenpick is now associated with
higher quality and high prices, the effect of
the price change has had a minimal effect on
its positioning in the eyes of consumers.
Limited promotion has led to many
consumers forgetting that Mvenpick is
available in the market.
Limited and constantly changing distribution
channels have led to consumers being
unsure as to where they can buy the ice
cream, preventing loyalty and in some cases,
repeat purchase.
Shifting to local production under license
has led to a fall in the relative quality of ice
cream, which may have affected positioning.
Opportunities:
The current lean towards Westernisation has
led to European ice cream seeming like a
more appealing option than locally produced
ice cream.
Threats:
Inflation has led to brands perceived as
premium to be less appealing to some
consumers.
The changes in foreign currency may have
led to increased costs for Mvenpick due to
franchising costs. These may also have
caused the shift to local production under
license.
Hagen-Dazs:
Product: Extremely high quality ice cream with
packaging in red, which is associated with
increasing appetite and being eye-catching.
Price: Excessively premium prices to play on a
price-quality relationship that is widespread in
Egypt. Price per serving is 41.50LE - much higher
than any of its competitors.
Distribution is limited to some supermarkets and
scoop shops under the name of Hagen-Dazs.
Promotion is limited to magazines. Sales
promotions are occasionally introduced including
promotional offers and cash/quantity discounts.
Strengths:
High quality ice cream
Established brand name in the Egyptian
market.
Weaknesses:
High prices have led to a fall in sales.
Limited distribution has led to a fall in
repeat purchase, especially after the
discontinuation of distribution in Gourmet
stores.
Opportunities:
The current lean towards Westernisation has
led to European ice cream seeming like a
more appealing option than locally produced
ice cream.
The presence of a price-quality relationship
means that Hagen-Dazs ice cream
continues to be associated with high quality.
Threats:
Inflation has meant that Hagen-Dazss high
prices have become increasingly
unappealing to Egyptian customers.
Increase in the cost of foreign currency may
have affected Hagen-Dazss franchising
and import costs, forcing an increase in
prices.
Positioning Strategy:
The primary aspect of Ben & Jerrys ice cream is its wide
variety of flavours. As such, it was placed higher than
direct competitors Mvenpick, Hagen-Dazs, and Nestl,
who have a generally low variety of flavours on that axis in
order to create a competitive advantage. Despite the
difference in distribution channels, Baskin Robbins variety
of flavours was taken into consideration to be exceeded by
Ben & Jerrys.
Ben & Jerrys will be positioned amongst premium brands
such as Cold Stone Creamery and Hagen-Dazs, both to
convey the quality of the ice cream, and to acknowledge
the added value in the CSR-related aspects of the supply
chain, in addition to other aspects.
Ben & Jerrys will also seek to be relatively affordable
compared to Hagen-Dazs within the sector of premium
brands.
Ben & Jerrys will seek to be considered as the provider of
the widest possible range of ice cream flavours, at a
generally affordable price. The brand would be associated
with fun and excitement, with attention to awareness of
global affairs.
Competitive Advantages/Differentiators:
Ben & Jerrys sports a significantly wide variety of flavours,
exceeding those of competitors such as Baskin Robbins and The
Cold Stone Creamery.
Ben & Jerrys also has a strong and established global brand name
that has permeated social media and become well-known even in
countries where the ice cream is not sold. This brand name rivals,
if not exceeds, that of Baskin Robbins and Cold Stone Creamery.
Ben & Jerrys is known for a wide variety of CSR-related values
that are continuously advocated and discussed in its promotional
campaigns. These values include, but are not limited to: fighting
racial discrimination, fighting political corruption, supporting
refugees, supporting farm workers, fighting climate change, and
supporting LGBTQ+ rights. While some competitors may mention
charitable movements, no competitor existing in the Egyptian
market has made itself as present as Ben & Jerrys in global crises
under multiple categories.
Because of the organic and GMO-free nature of Ben & Jerrys raw
materials, the ice cream produced is of a superior quality to those
of other competitors who do not have the same certification/
guarantee.
2. Market Research:
Methodology:
Marketing Intelligence had already been carried out with regards to the
micro and macro-market analyses. Minor additions were made to this
research as sources were found or made available.
Market Research:
Sample Selection:
Research Results:
Market Research:
Section One: Demographic Results:
Over 30% of the sample resided in New Cairo and the 5th
Settlement, with an additional 16% in Heliopolis and 13% in 6th October
City. As the three highest statistics for the question, it became clear that
these three areas are the most highly inhabited by the sample. That having
been said, the sample being distributed amongst AUC students could have
created a bias towards New Cairo city due to students living in on-campus
dorms or having rent apartments/studios closer to campus than their usual
homes. For that reason, decisions relating to distribution will not be
limited to these results, but they will nevertheless act as a guideline (see
Appendix G).
68% of respondents stated that their outings are within the 5th
Settlement. As previously mentioned, this bias may exist due to the
convenience of being near the AUC campus and the presence of the AUC
bus service. This question was posed to act as an additional source of
information for distribution channels, and while New Cairo and the 5th
Settlement remain key choices for respondents, other areas such as 6th
October, Sheikh Zayed and downtown areas could also be taken into
consideration (see Appendix J).
Previous travels and social media were the two main sources from
which respondents had heard about Ben & Jerrys, comprising 54.7% and
31.8% respectively. This suggests that promotion campaigns could play on
Ben & Jerrys previous presence abroad, using messages such as Finally
in Egypt and other similar phrases. Furthermore, the result shows the key
role social media-based promotion has to play in the success of Ben &
Jerrys promotion campaign in Egypt and shows that it is a primary
consideration to be taken into account (see Appendix N).
3. Marketing Objectives:
Objective A: As mentioned in the SWOT analysis, middle to high class in Egypt buy
ice-cream as a dessert, Ben and Jerrys objective is to increase Ben and Jerrys market
share to 35% by December 31st, 2018.
Objective B: As people are becoming more health oriented one of our objectives is to
increase the awareness of healthy ice cream to 70% by 31st May, 2018.
Objective C: 65% of the initial investment must be recovered after 7 months of the
business.
Objective D: Since we are launching a new ice-cream brand, the Egyptian has little
background about, our objective is to build trust with customers and meaningful
relationships in order to create satisfaction and thus create loyalty by December 31st,
2018.
Marketing Mix
Product:
The product we are offering is a well-known ice cream brand, Ben & Jerry's. There
will be three sizes available for the customers to choose from, which are Mini cups, Pints
and Quarts (see Appendix A1). We have decided to offer both standard flavors and
additional flavors; however, we will be focusing on the latter more. Standard flavors,
such as strawberry, chocolate, vanilla, must be offered because everyone is familiar with
them. On the other hand, our main focus will be on the additional flavors, as Ben &
Jerry's is famous for its unique flavors and spectacular taste. For example, Cheesecake
Brownie, Salted Caramel Core, Greek Yogurt and We are Waffling. In addition, 52% of
our survey respondents chose variety of flavors as what they find most appealing in ice
cream (see Appendix L); hence, we will be providing to the market an immense selection
of flavors.
Pricing:
In terms of pricing, Ben & Jerrys primary role was to fulfill its value proposition
and appeal to customers. The primary considerations taken into account were:
1. Costs
2. The selected price ranges from the market research carried out
3. The chosen pricing strategy
Costs were calculated based on fixed promotional costs, as well as the direct costs
for the product itself. Insufficient information was found regarding import fees and the
exact royalty system, however, negotiations will be carried out to reduce royalty costs,
and an estimate for import costs was taken into consideration when adding a markup to
prices. This markup was initially based on an increase of 18.5% based on Egyptian
National Bank interest rates to eliminate opportunity costs, followed by further increases
to cover additional costs and to generate a profit. Prices increased gradually as a result of
the increase in sizes, with a 25LE increase between small and medium size, and a 45LE
increase between medium and large to account for the difference in the number of scoops
(see Appendix S).
Costs were also taken into account when considering an increase in prices; this
increase was determined based on predicted increases in interest rates, and in costs,
alongside the predicted inflation rate in Egypt. In terms of direct costs, an annual 3%
increase was acknowledged despite indications of the fall in foreign currency, as the
direct costs will remain unchanged in USD based on the franchising contract. This 3%
increase was included to accommodate for the present instability in the Egyptian political
and economic environment, and to account for a potential worst-case scenario (see
Appendix U).
Market research displayed a widespread demanded price range, with an almost
equal percentage of respondents opting for a range of 15-20LE and 20-25LE for a single
serving of Ben & Jerrys ice cream. There were also 19.3% of respondents who claimed
to be willing to pay 25-30LE (see Appendix Q). This was taken into consideration when
selecting the prices, and while prices tread on the upper bound, demand in the market for
high-end ice cream brands appears to be generally inelastic, leaving room for adjustment.
A Market Skimming strategy was decided upon in order to attain as much revenue
as possible from the market. Because the quality of Ben & Jerrys ice cream is largely
superior to or on par with its competitors, and the Western image of Ben & Jerrys
alongside its brand equity, the strategy was deemed to be the most likely to result in
success. As such, prices were set to be closer to the upper bound of the demanded market
prices than the lower bound.
Place
As an initial stage, we will be distributing our products in supermarkets only. That
is primarily due to that 49.4% of respondents claimed to purchase ice cream primarily in
supermarkets (see Appendix I), and 71% who would be inclined to buy B&J's in
supermarkets (see Appendix P). The supermarkets we choose are Seoudi, Gourmet and
Fresh Food Market. We choose Seoudi because they emphasize on imported goods and
we wanted to take this opportunity to distribute out products in a well-known
establishment. Regarding Gourmet, they target A-class customers, which is our target
market, and these customers usually have low focus on prices. Lastly, we chose Fresh
Food Market due to the fact that it a supermarket known for only selling imported
commodities.
and how we used the combination of sales units (aided by promotion mix) and the pricing to gain
enough revenue.
[9:20 PM, 12/16/2017] Laila El Refaie: You then go to the next table and just explain how we
added in our additional costs
[9:21 PM, 12/16/2017] Laila El Refaie: And talk about the figures we need to break even vs the
figures we've forecasted
[9:21 PM, 12/16/2017] Laila El Refaie: And our margin of safety
[9:21 PM, 12/16/2017] Laila El Refaie:
Due to Nestls significant control over the boxed ice cream market, shown
especially in the market research (see Appendix K), it was decided that attempting to
extract market share from the Nestl brand name would be an unwise decision, most
especially due to their ability to cut costs and prices based on local production. As such,
the remaining 30% of the market, dominated by Mvenpick and Hagen-Dazs, will be
the main focus in terms of changing consumer demand. Of this 30%, Ben & Jerrys will
aim for 35% (10.5% of the overall market) market share by the end of Year 1 (see
Marketing Objectives). This will serve as a starting point, and is predicted to increase in
following years. As such, despite the lack of availability of sufficient quantitative data
with regards to the overall volume sales in the Egyptian ice cream market, and especially
within the boxed ice cream category, an estimate was carried out for the sales of Year 1.
Subsequent years were calculated based on a desired increase in sales. Estimated sales
growth was also calculated based on the implemented promotional mix throughout the
three years (see Appendix W).
In terms of the distribution of sales between the three sizes, the small size was
deemed to be likely to experience the highest level of sales due to its convenient nature;
consumers would be able to purchase the exact desired number of servings for a fast treat
for a family or child, or an exact number of consumers. This was followed by the large
sales due to its shareability; because families can easily purchase the large size and
distribute it amongst themselves throughout a week or fortnight, its convenience was
predicted to make it the most attractive to customers. Lastly, while the medium size was
predicted to have a significant level of sales, its sales were relatively lower than the other
two sizes due its lack of convenience for sharing; the medium size is convenient for
sharing between two or three consumers at maximum, and while this may be convenient
for a pair of children sharing, it would not appeal to Ben & Jerrys chosen positioning
strategy to appeal to families.
AmCham MENA. (n.d.). Excerpts from AmCham Egypt's Industry Insight on the
Real Estate Sector. Retrieved from http://www.amcham.org.eg/MENA_NewsLetter/
retcontent.asp?pageflag=101
Baskin Robbins / Egypt. (n.d.). Retrieved from https://www.facebook.com/
BaskinRobbinsEgypt/app/203545386647727/
Ben & Jerry's Consumer Insights and Demographics. (n.d.). Retrieved from
https://infoscout.co/brand/ben_n_jerrys
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groceries/desserts-syrups/ice-creams-toppings.html
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age_structure.html
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business.com/News/details/1705-Digital-in-2017/85052
Egypt Demographics. (n.d.). Retrieved from https://www.indexmundi.com/egypt/
demographics_profile.html
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restaurants/baskin-robbins-3125
Elmenus. (n.d.). Cold Stone Creamery. Retrieved from https://www.elmenus.com/
cairo/restaurants/cold-stone-creamery-4049
F. (2017, February 12). Egypts real estate boom has turned from economic safe
haven to rubble. Retrieved from https://qz.com/908391/egypts-real-estate-boom-has-
turned-from-economic-safe-haven-to-rubble/
FoodNavigator. (2013, October 24). Nestl expands Egyptian ice cream factory
on growing demand. Retrieved from https://www.foodnavigator.com/Article/2013/10/25/
Nestle-expands-Egyptian-ice-cream-factory-on-growing-demand
Gaballa, A. (2017, August 15). Egypt's unemployment rate below 12 percent for
first time since 2011 -CAPMAS. Retrieved from https://www.cnbc.com/2017/08/15/
reuters-america-egypts-unemployment-rate-below-12-percent-for-first-time-since-2011-
capmas.html
Hassan, M. K. (2017). [Personal interview].
Ken Research. (2017, January). Enormous growth in Ice cream Market in Egypt:
Ken Research. Retrieved from https://www.kenresearch.com/press/egypt-ice-cream-
market-research-report/916.html
Kotler, Philip and Gray Armstrong, Principles of Marketing, New Jersey: Prentice
Hall , Global Edition/Arab World Edition
Oxford Business Group, (2016, February 08). Egyptian telecoms sector moves
towards 4G. Retrieved from https://www.oxfordbusinessgroup.com/overview/counting-
down-government-rapidly-pushing-sector-towards-4g
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Trends report. Retrieved from http://www.propertyportalwatch.com/aqarmap-launches-
egypts-real-estate-trends-report/
Read, G. R., Read, C. C., Read, S. T., Read, N. Z., & Read, M. M. (n.d.). Ben &
Jerry's Franchise Information. Retrieved from https://www.entrepreneur.com/franchises/
benjerrys/291399
Social Bakers. (n.d.). September 2017 Social Marketing Report Egypt. Retrieved
from https://www.socialbakers.com/resources/reports/egypt/2017/september/
Sunny. (n.d.). Frozen Food: Ice Cream. Retrieved from http://www.sunny.com.eg/
index.php?route=product%2Fcategory&path=4_500025
TechNavio. (2016). Ice Cream Market in the US 2016-2020. Retrieved from
https://www.technavio.com/report/usa-food-ice-cream-market-us-2016-2020
Top 10 Cairo. (2015, December 02). The Best Ice Cream in Cairo. Retrieved from
http://top10cairo.com/best-ice-cream-cairo/
Trading Economics. (n.d.). Egypt GDP 1960-2017. Retrieved from https://
tradingeconomics.com/egypt/gdp
US, B. A. (2017, November 17). Ben & Jerry's Ice Cream. Retrieved from http://
www.benjerry.com/
US, B. A. (n.d.). Issues We Care About. Retrieved from http://www.benjerry.com/
values/issues-we-care-about
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en/country/egypt/overview#1
Appendices
Appendix A
Appendix B
Source: Kotler, Philip and Gray Armstrong, Principles of Marketing, New Jersey: Prentice Hall ,
Global Edition/Arab World Edition
Appendix C
Appendix D
Source: https://infoscout.co/brand/ben_n_jerrys
Appendix E
Appendix F
Appendix G
Appendix H
Appendix I
Appendix J
Appendix K
Appendix L
Appendix M
Appendix N
Appendix O
Appendix P
Appendix Q
Appendix R
Appendix S
Appendix T
Appendix U
Appendix V
Appendix W
Appendix X
Appendix Y
Source: http://www.indexmundi.com/egypt/age_structure.html
Appendix Z
Source: https://tradingeconomics.com/egypt/gdp
Appendix A1
Source: http://www.benjerry.com/flavors