The company that I have chosen for the basis for my report is Mars Incorporated. They have been placed the 5th largest privately held company in the United States and had a $30 billion annual sales in 2010. The majority of people think of chocolate when they hear of Mars; however their confectionary products are not the only thing they focus on. They cater for six business segments:-
• Petcare
• Wrigley
• Food
• Drink
• Symbioscience
• Chocolate
They are a privately owned company with more than 65,000 Associates who are committed to delivering the best quality in the segments above.
Out of the six segments I will be focusing on one ‘Chocolate’. Mars have 4 billion dollar global brands which includes ‘M&Ms’; ‘Snickers’ and also ‘Milky Way’.
Chocolate confectionery is very much a part of everyday life in the United Kingdom. The UK is the largest chocolate consumer in the world with an annual average per capita consumption of 11.5 kg followed by Liechtenstein with 10.9 kg.
The reason why I have chosen this company is because they have a strong background when it comes to chocolate and three of their products ‘Galaxy, Mars Bar and also Bounty’ have been listed in the Top Ten Chocolate bar of all time. One of the products that Mars Incorporated that interest me is ‘Galaxy’ which is extremely popular in the United Kingdom; Middle East and in Africa.
Galaxy is also known as Dove in many parts of the world such as United States; Germany; Malaysia and Greece. Nevertheless, the chocolate used in Dove products is a different taste from the chocolate used in Galaxy.
Galaxy has 11 different products such as Galaxy Ripple; Galaxy Cookie Crumble; Galaxy Counters.
As we know Galaxy has many different spin offs, which gave me an idea for a new product. “Galaxy Smooth White”. Galaxy believes that the indulgence about chocolate is about the whole experience. It has a luxury yet sensual feel towards it. The majority of white chocolate products is mainly aim at the children market, providing products such Milky Way and Kinder Bueno. There are a few white chocolate products for adults however are on the upper scale such as Divine; Fair-trade and Green & Blacks.
When looking into the needs and wants of a ‘Galaxy’ chocolate, customers still want that luxury feel when they take that first bite. (Galaxy calls it ‘Love at first bite’). Customers want a warm feeling inside and for that moment, they don’t want to worry about how many calories they are going to add. Galaxy Smooth white delivers exactly this and more. It provides adults with a white chocolate that is not deemed to be immature or just any chocolate that you would have daily in your lunch box. This chocolate is for lovers of white chocolate or chocolate in general; who enjoy indulging themselves with an experience that allows them to be in their own world where everything is perfect for that moment.
70% of the whole UK confectionery market is accounted for by chocolate, with annual sales of £3.75bn. White chocolate only accounts for just 1 to 2% of UK chocolate consumption (milk chocolate accounts for 92%). Tony Bilsborough, Head of UK Media Relations (Cadbury) believes that there is a massive growth potential with white chocolate. “We’ve seen the figures and our competitors have, too,” he says. “I think you could say that white is the new brown.”
According to market research it has shown that white chocolate is famous among the female segment of the United Kingdom population. Women in return have rewarded Galaxy with sales figures that have totalled companies such as Ferrero, Green and Black’s, and Lindt combined. (According to UNS Worldpanel data.) Galaxy’s target market is women between the ages of 25 and 45 however for Galaxy smooth White, I would want to lower the age to 21, as I believe in this generation, women from the age of 21 are deemed to be more mature than they were 10 years ago as they are more independent and becoming more career focused.
When looking at segmentation criteria for Galaxy Smooth white, I looked at ‘Demographic’. This segmentation involves dividing the market into different groups based on variables that relate to age, gender, family size, income, occupation, education, lifecycle and generation. This is known to be one of the most popular bases for segmenting consumers groups, mainly as consumers wants are closely linked to such variables as income and age; and there is more data available to assist with Demographic segmentation process.
Below are the main demographic segmentation variables for ‘Galaxy Smooth White’:
Age/gender
As explained above Galaxy Smooth White will be aimed at 21-45 year old women. As facts show that women in the United Kingdom find white chocolate very popular. There are many white chocolate available for children so breaking into that market will be a massive risk, whereas white chocolate aimed at women is a quite small market waiting to be broken. Galaxy is also known to be a chocolate that is soft; sensual and even romantic. So aiming this product towards men will be a big fail.
Income
When looking at this product, its shows it’s a luxury good. However compared to products such as Green & Black and Divine it is not at that end of the scale. Galaxy Smooth White appeals to consumers of all types of income which makes it different from competitors such as Divine who are aimed at those with a medium to high income.
Lifestyle
When looking at Galaxy Smooth White the type of women it is aimed at, is those with a hectic lifestyle; so whether it be someone who works all through the week; a mother of four or even a student who constantly in their books. The aim of the chocolate is that when a women needs a moment for herself, Galaxy Smooth White allows her to calm down; allows her to focus on herself; her needs and for that moment nothing else matters.
The reason why I chose women between the age of 21 and 45 for the target market is that apart from children they are the main consumers for white chocolate. There is also room for a luxury, sensuous affordable chocolate in the confectionery market. I still want to keep Galaxy’s consumers as a target market as the company has been influencing it consumers to fall in love with Galaxy’s silky taste while also endorsing itself as a symbol of indulgence, femininity, and sensuousness.
It is important that Galaxy’s traditional image is reserved as there are many benefits for Galaxy Smooth White to be associated with Galaxy. One brand that may be seemed as competition is Cadbury’s Dream, which is portrayed by them as a ‘white chocolate made with real smooth, melt in your mouth chocolate’. I know that Galaxy Smooth White will be positioned at a higher rank compared to Cadbury’s Dream as I have a more solid knowledge of my target market and Dream did not have a clear clarification of what their target market was.
Galaxy has been linked to female-friendly activities such as book and films such as The Devil Wears Prada and Sex and The City. All this relates to Galaxy Smooth White Brand.
When marketing Galaxy Smooth White, I need to make sure that I create a successful mix of:
• Being the ‘right’ product
• Sold at the ‘right’ price
• Sold in the ‘right’ place
• Using the ‘right’ promotion
• Product
Galaxy is already a household name and is known for being a chocolate that caters for women. One of their branded names is ‘Why have cotton when you can have silk?’ When looking at what the customers wants from the Galaxy Smooth White, they still want that feeling of having a soft, smooth silk like feeling of white chocolate. Not only does it have to taste right, it has to look perfect. The packaging should be similar to the current Galaxy Smooth Milk however have white/sliver silky foil covers with the same colour background, however the words ‘Galaxy’ written in white. The Galaxy Smooth White should be written in white. We still want to keep the packaging simple as the product is our main focus.
Comparing this product to others such as dream, I think the Brand name does put Galaxy Smooth White at an advantage as what we are selling relates to the brand; has been backed up by the brand. So we are in a position where the consumers know what to expect.
Price
Galaxy bars are now (46g) sold at a retail price of 57p. The larger ones (125g) are sold at £1.26. When looking at pricing the ‘Price must be right’. In regards to Galaxy Smooth white I will use, Penetration Pricing. The aim of this is to increase the market share of a product. Galaxy Smooth White could you the “Special Introductory Offer”. Here I am able to set a relatively low initial entry price, lower than the established price to attract new customers. This strategy aims to encourage consumers to switch to the new product because of the lower price which will be £1 for 125g and 45p for 46g.
Although this type of pricing is mostly associated with a marketing objective of increasing market share or sales volume, in the short term profits will result in being lower than if the price was set higher. However long term, there would be profitability of higher market share, so the pricing strategy can often be justified.
Place
We have to make sure that the Galaxy Smooth White is obtainable in supermarket, online and even local shops. Galaxy Smooth White should be available for consumers as other confectionaries are. So even a vending machine at work should have ‘Galaxy Smooth White’ waiting for the consumer to buy it.
Our distribution channel will be Suppliers –wholesalers/companies-Consumers. I also would want to send samples to catalogue companies as a way of introducing the new Galaxy Smooth White. The type of Catalogues I would like to send samples to be “More” and “Cosmopolitan as they are magazine that are aimed at women aged 21-45.
Promotion
The target market does need to be aware of the existence and availability of the product through promotion. To promote Galaxy Smooth White there needs to be a broad range of advertising, through magazine; television and billboards. The best time to promote and launch Galaxy Smooth White would be Christmas as it can relate to the ‘White’ Christmas theme. It also related back to the brand, as many people will be busy buying Christmas presents; students will be busy trying to get all their Christmas assignments done in time and they can relax with a bar of Galaxy Smooth White.
The marketing mix should be more than a checklist of the 4P’s as we mist blend together all the elements. The pricing, promotional and distribution strategy of ‘Galaxy Smooth White; must be consistent with the product and target market.
Booms and Bitner (1981) suggested another extra 3P’s that are:
• People
• Physical evidence
• Process
People looks at all the people whether they be directly or indirectly involved with the product. Process analyses the procedure in which the flow of the activities of which the product is consumed. Lastly, physical evidence is related to the environment in which the product is delivered.
People
The impact that people have within the market should never be underestimated. This is most obvious when looking at front line sales to customer service staff which will have a direct impact on how your product is perceived. Galaxy as a whole makes sure that the customer services staff are provide high quality services to our consumers. This is why ‘Galaxy Smooth White’ will be distributed in well names supermarket known for their excellent customer service such as ASDA and Tesco. All the elements of the marketing mix will have an impact in regards to Galaxy Smooth White but ‘People’ carries an importance of regarding marketing as an integral part of the way I would do business is clear.
Process
This part of the mix is about being ‘easy to do business with’. We have all been in situation where we have either become frustrated at call centres that are not able to answer our questions; irritated when you are unable to purchase something in the shop because it is not recognise on their computer and you clearly see it on the shelf. Situations like this make this element important. This element will make sure ‘Galaxy Smooth White’ looks at this from its consumer’s side. We will make sure that the process right and easy.
Physical Evidence
With tangible goods such as ‘Galaxy Smooth White’ we can offer our consumers the chance to ‘try before you buy’, or at least see, touch or smell the good. This is why in out promotion element I explained by sampling the chocolate in magazine, aimed towards our target market. Through this we will be able to build trust and then a relationship with the consumer and to do this we must provide evidence of the quality that we will be providing as possible. Physical evidence refers to all the tangible, visible touch points that our consumer will come across before they buy.
Overall, I do believe that this product will sell well because its new product made from an existing product and Galaxy has a strong name on its own and the products that have been made from Galaxy have all been a success and are still marketable.
References
New year, new Galaxy – Rainforest Alliance Certified™ Cocoa . 2011. New year, new Galaxy – Rainforest Alliance Certified™ Cocoa . [ONLINE] Available at:http://www.galaxychocolate.co.uk/. [Accessed 29 November 2011].
About Mars | World Famous Company | Mars . 2011. About Mars | World Famous Company | Mars . [ONLINE] Available at: http://www.mars.com/global/about.aspx. [Accessed 29 November 2011]
7-Ps – Extended Marketing Mix – Booms and Bitner. 2011. 7-Ps – Extended Marketing Mix – Booms and Bitner. [ONLINE] Available at:http://www.valuebasedmanagement.net/methods_booms_bitner_7Ps.html. [Accessed 12 December 2011
Nestle Marketing Mix and SWOT . 2011. Nestle Marketing Mix and SWOT . [ONLINE] Available at: http://www.docstoc.com/docs/12163694/Nestle-Marketing-Mix-and-SWOT. [Accessed 12 December 2011].
Health, Beauty, Fashion, Love, Careers and more – MORE Magazine. 2011. Health, Beauty, Fashion, Love, Careers and more – MORE Magazine. [ONLINE] Available at:http://www.more.com/. [Accessed 12 December 2011].
How to Develop Your Distribution Channels | Marketing M.O.. 2011. How to Develop Your Distribution Channels | Marketing M.O.. [ONLINE] Available at:http://www.marketingmo.com/strategic-planning/how-to-develop-your-distribution-channels/. [Accessed 12 December 2011].
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