Brand

February 4th, 2023

Cadbury India

Table of contents

Chocolates had its beginnings in the times of the Mayas and the Aztecs when they beat cocoa into a pulp and made bitter frothy chocolate out of them. They first became popular in Europe in a highly unrefined form. Then the Hershey Food Company was the first to bring out chocolates in the currently popular solid form. The main ingredient of chocolates is cocoa, grown mainly on the equatorial zones of South America. The other ingredients that go into the making of chocolates are: sugar, milk solids, and permitted emulsifiers. Cocoa constitutes nearly 40% of the total raw material cost.

The following report attempts to make a study on the chocolate industry and the position of the chocolate brand, Cadbury. The brand name chosen is the umbrella brand as we feel that the corporate name is recognised as a brand, not so much its individual products. The study will focus on the marketing and advertising strategy employed by Cadbury in the context of the Indian macro environment and industry structure. The advertising strategy will be studied with respect to Cadbury’s business and marketing objectives. The strategies adopted will be analyzed for each product offering.

The same is followed to a minimal extent for its major competitor, Nestle India Limited, to get an understanding of where Cadbury stands. The report initially focuses on an examination of the industry environment and the product class. The report then goes on to analyse the corporate, marketing and advertising strategies adopted by the selected company and its main competitor. It concludes by looking at the future challenges and recommendations for the industry and the company.

CDM was positioned as a product that elders (parents) bought for children. Cadbury has actually associated itself to enduring and emotional values of love, sharing, parental affection, and reward. Considering that CDM practically acts as a trend setter for all the brands in this segment, this limited the positioning of the entire category towards children only. Amul attempted to expand the category by bringing in teenagers, but it was not successful. The Cadbury brands in this segment are CDM, Fruit ; Nut, Crackle, Bournville.

CDM is basically the leading brand here, and the others act as an endorser basket for the company. Nestle forms 25% of this segment and the company’s major brands are Nestle Classic, Nestle Milk Chocolate and Nestle Crunch. From around 1993, this segment began showing signs of maturity. This was hurting CDM. This led to Cadbury attempting to rejuvenate the segment. They changed their core customer from children to that of the universe: both children and adults. This attempt at redefining the market to enticing all age groups helped bring about changes in the segment.

Today, the notion associated with the consumption of chocolates is that of casualness instead of just product consumption. Today, this segment grows at 40% per annum, and is likely to remain an important segment for further growth. Countline Bars Segment This segment forms 33% of the chocolates market. This segment is mostly targeted at teenagers. Major Cadbury brands are 5-Star, Break, Real, Krisp, and Double Decker. 5-Star is doing well here (about 50% of the segment) while the rest of the brands act as endorser brands. Nestle has a minor presence in this category with its product Bar-One.

Growth of a Sub Segment

Chocolate Wafers Chocolate wafers are the new products being offered by chocolate companies today in order to expand the market. In 1995, Cadbury and Nestle launched Perk and KitKat respectively. These were wafer–enrobed chocolates in a new context and a different benefit offering. Both chocolates had a snack positioning. Perk offered the anytime anywhere snack proposition – ‘Thodi si Pet Puja’, whereas KitKat tried to promote snacking through ‘Have a break, Have a KitKat. The growth rate of this segment is 15-20% annually, and is estimated to be worth over Rs. 00 crores, making it a very lucrative segment. Internationally, confectionery products like wafer chocolates have a very high tonnage and have a much bigger future than plain chocolates. Market research and success of these two brands suggest that Indian consumers are ready for accepting the wafer chocolate proposition. The conviction of both Cadbury and Nestle towards this segment can be gauged from the fact that both brands are seeing unprecedented allocation of funds, to the tune of 60% to 70% of the total advertisement budget of both companies on chocolates. Choco Panned Segments

This segment forms 4% of the total market and Cadbury has 100% of the market in this segment. The major brands are Nutties, Caramels, Butterscotch and Tiffins. All of these brands have been used by Cadbury to drive variety, induce gifting practices and serve to some specific taste preferences. Cadbury does not advertise these brands. They have been used as flanker products. The opportunity for growth in this segment is high what with the imminent entry of multinationals like Mars and Hershey’s. This is also likely to pose a threat to Cadbury, what with its complacency. Sugar Panned Segment

This segment form 15% of the total market and Cadbury has about 98% of this segment, its major brands being Gems and Eclairs. Eclairs has been used strategically to foster chocolate consumption among children as well as adults by offering a tiny ‘guilt free, eat no more than a biteful’ at a convenient price point. (65% of Eclairs eaters are from the households earning less than Rs. 4000/- per month. ) Gems is still Cadbury’s primary tool to protect its franchise in the child segment. It was previously associated in its commercials with the international spy character, James Bond.

Around 1995, Gems was repositioned to broad base its appeal from 3-6 years olds to teenagers as well. However this failed due to the product form which has become deeply rooted with kids and hence the company has reverted back to the target segment of kids with a new offering of ‘Chocogems’. With Respect To The Consumer Buying Power These are: High income customers (price greater than Rs. 25 for 40 gm. ) who will go in for premium chocolate brands. Middle income customers (price between Rs. 10 – 25) who are price sensitive. Children, who are mostly price driven and will consume more of toffees in the price range of Rs.

Psychographics And Demographics

This is attempted in terms of the consumers. High income customers – it is estimated the age group buying the chocolates will be 22 onwards. The income level is estimated to be Rs. 8000 per month. The customers are mostly urban, and are mostly professionals (engineers, doctors, executives, etc. ) The psychographic profile: They can either be individuals indulging themselves, or they could be indulging their children. They are inner directed people who form their own values and norms and believe in not adhering blindly to social norms. They re somewhat occasion driven in their buying behaviour. Middle income customers – it is estimated that the age group in this segment will be 15 plus. The income level is estimated to be around Rs. 5000 per month. The consumers can be urban, semi urban, and is currently spreading to rural areas. The psychographic profile: they are likely to be variety seeking in their behaviour. They are self expressing by nature and inner directed to an extent. They like to indulge themselves. Children – the upper age limit is estimated to be 12 years. They mostly purchase their chocolates with their pocket money. The consumers can be urban, semi urban, and rural, though their is a somewhat greater emphasis on urban. The psychographic profile: they are novelty seeking in behaviour. They are also fun loving.

Cadbury India Limited Cadbury India limited was set up as a wholly owned subsidiary of the UK-based Cadbury Schweppes Overseas Limited in July 1948. They started off by setting up production facilities at Thane to manufacture chocolates, malted foods, cocoa powder and drinking chocolate using the technical know how of the parent company.

The company has manufacturing facilities at Malanpur and Induri. During 1997, the company invested Rs. 80 crores in the two factories. At Malanpur, the capacity of Eclairs (one of the Cadbury range of products) production was increased, a new wafer line was installed, and the chocolate making capacity was increased. This increase is from 7000 to 17000 tonnes. At Induri, a new moulded line was installed to manufacture center filled moulded in orange and coffee Truffle. Cadbury is the market leader in the Indian chocolate market with a share of 70% and sales of around 12000 tons.

It has successfully differentiated its product over the years by strategic brand building. The company had realised that chocolates by itself do not satisfy any immediate needs (soft drinks would satisfy thirst, ice cream would provide relief from heat), so they would have to be associated with human feelings of romance, magic, love and affection. So it had at one point of time employed emotional attachment as basis of differentiation. This has lately been modified to including the rational perspective so as to catalyze increased consumption of chocolates within the family.

On analysing the market, the phenomenal success of the company can be attributed to: The pioneer advantage (first mover advantage) – The company was the first to enter the Indian market, as early as 1956. For a long time, it was practically the only dominant player in the market. It, therefore, enjoyed a large share of both customer’s heart and mind. So much so that for an entire generation, chocolate was synonymous with Cadbury. It is only recently that the company has started facing some threat from Nestle.

A strong endorser brand – Cadbury realised early that volumes would not be enough to support all its brands with heavy advertisements. Hence what they were to take CDM as the flagship brand and advertised it heavily to popularise the brand name to help the flanker brands around CDM. But in the last two years the company has spent extensively on the chocolate wafer segment (without treating it as a flanker brand of CDM), seeing as how the segment has been growing phenomenally. Right product formulation – the climatic conditions and the Indian taste are very different from the western markets where the company first started its operations.

Cadbury was able to successfully reformulate its product as per the Indian conditions, while entrants like Nestle could not do so. Presence in all segments – Cadbury has a presence in the entire range, starting from low priced hard boiled sweets and sugar confectionery to the premium range of chocolates. The company also claims success in all these segments it has been entering recently. The following is the list of the major brands of the company: Cadbury’s Dairy Milk Cadbury’s Gems Cadbury’s Nutties Cadbury’s Crackle Cadbury’s 5 Star Cadbury’s Mr.

It was in 1824 that John Cadbury opened a shop in Birmingham in the UK. Originally selling tea and it was, however, the marginal lines of cocoa and chocolate that in just a few years took over as the mainstay of the business. The Cadbury Brothers first made milk chocolate in 1897, but by today’s standards was a very coarse dry product made by blending milk powder with cocoa and sugar.

The Swiss who produced a superior product by using condensed milk then dominated the milk chocolate market. In the early 1900s George Cadbury was determined to meet this challenge and, together with the experts from the Bournville factory, started to research new recipes and production methods. By June 1904 the recipe was perfected and a delicious new milk chocolate made with full cream milk, and containing far more milk than any previously known product, was ready to go into production. Although considerable technological advances have since been made in the production processes, the recipe is still basically the same as it was in 1904.

In 1905 the chocolate was launched under the name Cadbury Dairy Milk. Cadbury India limited was set up as a wholly owned subsidiary of the UK-based Cadbury Schweppes Overseas Limited in July 1948. -“Working together to create brands people love”. Cadbury is an international company, proud of their long heritage, respectful of the social and natural environment in which they operate, supportive of their consumers, customers and colleagues and passionate about success.

Cadbury believes in making, marketing and selling unique brands which give or bring pleasure to millions of consumers around the world every day. Cadbury is committed to the highest standards of corporate governance and corporate and social responsibility. Chocolate-The very word makes your mouth water. Chocolate is not just a food it’s a state of mind. Throughout history, chocolate has been associated with romance and sharing, and today the richness and smoothness of Cadbury chocolate is what makes it one of the world’s favorite treats.

Cadbury is a world-renowned name with more than 150 years of chocolate heritage. Available in over 160 countries, Cadbury is the single largest brand in chocolate on an international basis. The Cadbury name can be seen in all chocolate related categories including confectionery, ice cream, cakes, biscuits, chilled desserts and chocolate based drinks. Synonymous with the very word chocolate, Cadbury has a unique relationship with the consumer. This relationship is underpinned by the powerful visual icons of the Cadbury brands – the Cadbury signature, the colour purple, the ‘glass and a half’ trademark, and the chocolate itself.

These all come together to form the brand identity-the Cadbury Master Brand. Cadbury had realized that chocolates by itself do not satisfy any immediate needs (soft drinks would satisfy thirst, ice cream would provide relief from heat), so they would have to be associated with human feelings of romance, magic, love and affection. So it had at one point of time employed emotional attachment as basis of differentiation. This has lately been modified to including the rational perspective so as to catalyze increased consumption of chocolates within the family.

Indian Chocolate market having a turnover of Rs. 350 crore (20,000 tonnes) has three major market players CIL dominating the market by capturing 70% of the market share, followed by Nestle having 20% of market share, Amul having a niche market of 7% and remaining 3% with small players. 7. 1 Nestle India Limited: Nestle is a strong player in chocolates world wide but it entered the Indian market much later (in 1991) than one of its global competitor Cadbury. . Nestle ended 1997with a 41% increase in their net profit with Rs. 74. 3 crores. The net sales of the company amounted to Rs. 425 crores, which is an 18% increase over last year. Out of this, chocolates had a 31% increase in the sales turnover. Nestle’s initial foray into the Indian market was not very successful. The problem was in the formulation of the product. They were soft chocolates with high fat content which were unsuitable to the Indian climate. Also, the distribution focus had been on the larger cities and urban areas, which limited their customer base. It was with the launch of KitKat that the company’s strategy changed with respect to both product and distribution.

It increased its distribution network to cover small towns and interiors as well, so as to increase their customer base. It also modified the formulation of the moulded chocolates to suit the Indian conditions. The company used three layers of foil packaging so that KitKat could survive the summer heat. The product was targeted at the casual consumers of chocolates – primarily adults through a clear proposition of fulfilling a snacking need which basically took advantage of the fact that the existing chocolates in the market were too heavy to be had as a light snack.

The company sees a huge potential in the wafer covered with milk chocolate, not only in the chocolate market but also in the premium biscuit market. The company is trying to expand the market in this direction by portraying it as a product taken during the breaks. The distribution and packaging are in harmony with the broad marketing plans of the company. Nestle followed a strategy of distributing its chocolates in ice-lined Sintex tanks to protect them. KitKat currently has the maximum reach in terms of the number of outlets it accesses.

This has helped the company to increase the consumer base and to sell the new concept. KitKat packaging synergies with the total brand appeal. It has been packaged to keep the product fresh, crisp and protected from the harsh climactic conditions in the country. Special packaging is also integral to KitKat break ritual, which plays a part in the brand mystique. Nestle owes much of the success of its Eclair to the price point at which it was kept. Nestle Eclair has a filling of white chocolate. This makes it relatively less exposed to the perils of high excise duties faced by other Eclairs.

The white chocolate filling also -makes it different in the taste and therefore Cadbury Eclairs for a long time neglected it as its competitor. Taking advantage of the exemption from excise hike, Nestle has priced its Eclair appropriately in a price sensitive market. Taking this price advantage, it has been able to corner 7. 5% of the market for chocolates as a whole and 27% of the market for eclairs. Milky Bar is a white chocolate from Nestle and is targeted primarily at children. The sugary taste of the white chocolate appeals to the children.

It is positioned as a source of energy and nutrition (Ad Line – Milkybar, give me the power). The positioning is used to influence the decision-making unit for the consumers in this segment i. e. their –parents. The health and nutrition oriented proposition is used to counter the negative perception of the parents that chocolates are bad for the teeth and unhealthy. Nestle have also entered the sugar confectionery market, in direct competition with Cadbury by offering Allen’s Splash, and Allen’s Koffees, and Allen’s Butterscotch.

With eroding margins and increasing competition, Nestle has also started to look at exports to boost its turnover.

Strengths:

Market leader in coffee and baby food sector
Well-established distribution network extending to rural areas. • Strong brands in the FMCG sector.
Low cost operations
Large product portfolio.

Weaknesses:

Low presence in health drinks: – In comparison to Bournvita, Horlicks and Boost the market penetration of MILO is very low.
Low Market Share in chocolates as compared to Cadbury’s.
Didn’t get the first movers advantage. Initially the distribution focus had been on the larger cities and urban areas, which limited their customer base.

Amul (Gujarat Cooperative Milk Marketing Federation Limited):- Amul is the third player in the chocolate market in India. This brand does not have any international lineage and is miniscule in terms of market share in chocolates, as compared to the other two players Cadbury and Nestle. Amul had an extremely focused positioning of ‘A gift for someone you Love’, albeit not targeted at a single age group.

Strengths:

Strong and extensive distribution and sales network. Large market penetration in dairy industry
Age old market presence carries a traditional image.
Quality and purity and trust as consumer relationship.
Value for money and low price.

Weaknesses:

No focus on the chocolate industry.
Lack of organizational commitment.
Amul chocolates have shown a very limited product differentiation.
Low retailers margin.

Cadbury’s strategy is to create robust and sustainable regional positions in its two core markets, confectionery and beverages, through organic growth, acquisitions and disposals.

It has exited markets where its believed it did not have or could not build, sustainable business models. It has strengthened existing positions and extended its presence in higher margin, faster growing product categories or geographies within its core markets. The company follows a multi branding strategy i. e. having more than one brand cater to a particular segment that may even lead to the cannibalization of sales of one brand. The game plan for the company is to increase the consumption of chocolate and confectionery among adults by offering products in convenient packs at affordable price.

To develop the future we need a clear understanding of the future. Cadbury’s has these goals for the years ahead:- • Deliver superior shareowner returns on the back of superior business performance . Profitably and significantly increase its share of the global confectionery market .Profitably secure and then grow its share of the regional beverages markets in which the company has chosen to participate . To reinforce its reputation as a Company which motivates, develops and rewards employees for superior performance and make a difference in the communities in which it does business. To develop brands with mass franchise and widen out its distribution network further into the rural sector. Keeping with the awareness that new product development provides the key to growth in this market. Launch one new product every year and extend its sugar confectionery range “The future strategy of the company is to maintain its dominance. ”

High income customers – it is estimated the age group buying the chocolates will be 22 onwards. The income level is estimated to be Rs. 8000 per month. The customers are mostly urban, and are mostly professionals (engineers, doctors, executives, etc. ) Middle income customers – it is estimated that the age group in this segment will be 15 plus. The income level is estimated to be around Rs. 5000 per month. The consumers can be urban, semi urban, and is currently spreading to rural areas. Children – the upper age limit is estimated to be 12 years. They mostly purchase their chocolates with their pocket money.

The consumers can be urban, semi urban, and rural, though there is a somewhat greater emphasis on urban. The psychographic profile: they are novelty seeking in behaviour. They are also fun loving. Consumer Buying Behaviour:- The product category comes under Fast Moving Consumer Foods (FMCG) and the product is generally purchased as a convenience good. The general characteristics of this product are: It is a low involvement product, but there are significant differences in various brands in market. The following matrix may help in studying the behavior of consumer for this particular product category.

High InvolvementLow involvement Significant differences Complex buying behavior Variety seeking behaviour Between brands chocolates Few differencesDissonance reducing Habitual buying Between brandsbuying behaviorbehaviour. In this category, consumers are often found to do a lot of brand switching. Although the consumer expects some benefits from chocolates, but he chooses a brand without much evaluation, and evaluate it during consumption only. But next time, quite often he may reach for another brand out of boredom or a wish for a different taste.

Brand switching occurs for the sake of variety rather than dissatisfaction. Since Cadbury has 70 % of market share, this variety-seeking behavior had not affected its sales negatively. This had been possible due to various factors like lack of strong competition. However, with the new entrants in the market, there has been stiff competition. There are few segments like wafer chocolates segment where company faces strong competition from Nestle, the second major player in the market. In these segments company should try to increase brand loyalty for its brands.

This increased consumer loyalty will also act as deterrent towards development of strong competitors in other segments. Further to increase the overall size of market, company should try to increase consumer’s involvement with chocolates. The company has its products focused around three basic propositions:- ( Drives attitudes and behaviour: This is led by the company’s flagship brand Cadbury Dairy Milk (CDM). CDM is currently positioned on the emotional plank of spontaneity and self-expression and is targeted mainly on the adult consumer. Drives Snacking Consumption: It has two main brands in this category – 5 Star & Perk. However both the brands are positioned in a slightly different manner. Perk is positioned as a any time snack anywhere, whereas 5 star is positioned as a Energy Bar. Drives variety, gifting and taste preference: The two brands in this category are Gems and Eclairs. However, there is a lot of difference between these two brands. While Gems is targeted primarily at children, Eclairs is a chocolate simulator, which simulated the taste and the feel of the chocolate but has to popped in the mouth like a toffee. Besides these endorsing brands, Cadbury traditionally has maintained a whole battery of flank and satellites in its brand portfolio.

It has always focused on preempting any moves by a competitor by launching a brand of its own. The threat of Nestle’s entry led to the launch of tactical brands like All Silk, Crackle and Break. Therefore, in the Cadbury’s brand system, the flanker brands are used for the tactical purpose of plugging a gap in the segment where the threat of entry by a rival brand was imminent. Cadbury has also entered the sugar confectionery range of Googly and Mocka with the intention of expanding its range further. However, Nestle’s successful entry through KitKat in the wafer segment proved that unless you support your flank brands actively, they are not going to be of any use in blocking competition. And hence Cadbury is showing some active interest in the area.

The Chocolate Industry in India

The chocolate industry in India has a size of 20000 tonnes and is worth about Rs. 400 crores. The chocolate market has been growing by nearly 35%; however there has been some slowdown in the last two years. The chocolate market is predominantly urban with coverage of 95%. The sales volume have decreased by 5% in the last year and the chocolate market had declined with the average consumption coming down by 25% from 16000 tonnes to the current level of 12000 in the first quarter of 1997, largely due to the steep hike in excise duties. However, this trend has seen kind of a reversal in the latter half of 1997. Cadbury India limited was set up as a wholly owned subsidiary of the UK-based Cadbury Schweppes Overseas Limited. The parent company is the fourth largest in the world chocolate market, after Mars, Nestle, and Philip Morris. They set up operations here as far back as 1948, and will thus be completing 50 years of its existence here. Cadbury’s milk chocolate was first introduced in the Indian market in 1956. It made an immediate impact, quickly becoming the market leader – a success story, even to this day. The Major Players The major national players in the chocolate market in India are: Cadbury India Limited

Nestle India Limited Gujarat Cooperative Milk Marketing Federation Limited (Amul) Two giants – Cadbury and Nestle, dominate the combined chocolate and eclair market. Together they have a 90% share of the entire market. Amul holds a 5% share, and is present only in the moulded chocolate segment of the market . Brand identity is a unique set of brand associations that the brand strategist aspires to create or maintain. These associations represent what the brand stands for and imply a promise to customers from the organization members.

For the chocolate market, Cadbury is pitted against competitors like Nestle, Amul and substitutes like, chips, biscuits and other light snacks. Idea of positioning Cadbury is to occupy a distinct space, which is differentiable, yet powerful. Many of the world’s most powerful brands spend a great deal of time putting personality into their brands. It is the personality of a brand that can appeal to the four functions of a person’s mind. For example, people make judgments about products and companies in personality terms. They might say, “I don’t think that company is very friendly”, “I feel uneasy when I go into that branch”, “I just know that salesmen is not telling the truth about that product” or “That offer doesn’t smell right to me”. Their minds work in a personality driven way.

Given that this is true, then how can a company create a personality for its product or for itself? The answer lies in the choice and application of personality values and characteristics. A product’s brand personality is a description of its characteristics in relation to the target market for the product. It assists marketers to develop suitable advertising and promotional campaigns for the product. The following diagram shows the Brand Personality of Cadbury.

When Cadbury entered Indian market it knew that that India is a tough nut to crack with its vast and diverse geographical and cultural diversifications. Major challenges for Cadbury India was to get people accustomed to chocolates- primarily seen as a western taste and do so by reaching out to the masses in a land where mindsets and preferences are as diverse as the country itself.

It decided to use a common platform that is universal to all cultures –‘The platform of love and affection’. It used emotional appeals to position its brand as a surrogate to parental affection for their children. The positioning clicked for Cadbury but the brand audit done a few years later revealed that it had restricted its market to the kids. To grow it had to target the elders also. So what was the next Big Idea? The marketers decided to position the product ‘for the kid in all of us’. The communication for the new positioning was ‘The Real Taste of Life’. It portrayed itself as a perfect expression of spontaneous happy, joyous feelings.

Cadbury conducts regular audits and tries to reinvent its strategies according to the findings of the audits. Cadbury was recently plagued with allegations of supplying Worm infected chocolates. It received huge negative publicity and needs to avoid such fatal mistakes. The root cause for the above problem lies in the Distribution. Chocolates are a perishable product and therefore needs to be supplied to a retail outlet as fast as possible. At the same time retailers should be compensated for any stock that has expired without any hassles. The products also need to be transported in a refrigerated environment as they melt in room temperature. This Therefore needs to clearly redefine its distribution strategies.

As Indian markets become more receptive to globalization there are chances of more and more MNCs entering the Indian market. Cadbury needs to maintain its brand equity through regular innovative advertisements and promotions. There is a growing threat from local substitutes. The Sweet shops are reinventing themselves and coming up with their own versions of chocolates. These find favor with the local tastes and are available in many varieties. Both MNC and Local Bakery brands are expanding their operations. Theses bakeries are manufacturing various verities of chocolates locally with local blends. They do not have to invest in extensive distribution and have as good quality as Cadbury. Their USP is providing fresh chocolates.

Cadbury has to reinvent its strategies to face such future challenges. Cadbury’s major problems are linked to the need for very responsive distribution network due to the perishable nature of its products. Costs go up and problems like the recent worm episode arise. What we suggest is a revamping of its distribution network to make it more responsive. Indian consumers mainly consume sweets during some festivals. It must come up with innovative offerings for its chocolates to suit the need during such occasions. e. g. : Come up with shapes similar to Indian Sweets and package it innovatively reflecting the festival colors. Start exploring newer distribution channels like E-tailing where Hi-value chocolates are sold in specialized packs.

Cadbury’s Brand Personality Indian sweets having chocolate flavor Many MNC’s planning to enter India. Also there threats from existing players in confectionary industry wanting to enter choclates. Vertical Integration could increase bargaining power of suppliers. Indian consumers are price sensitive and may easily switch. High rivalry but Cadbury enjoys a good brand recall. Substitutes Substitutes like IceCreams, potato chips, biscuits, soft drinks, chewing gum, are a source of threat as well as opportunity for market expansion. Suppliers Major raw material Suppliers are cocoa producers in Latin American countries. Due to negligible Domestic production in

India, suppliers enjoy high bargaining power. Milk supply also fluctuates, therefore, in summer months, milk suppliers gain sufficient bargaining power. Competitors Duopoly Both the major players have Financial muscle to sustain their Brands All players following a pull strategy. Buyers Since chocolates do not satisfy any immediate needs, it is not a necessary item. Consumer power is very high and consumers need to be persuaded through various positioning planks to consume chocolates. New Entrants Imminent entry of global majors like Hershey’s, Mars etc. is bound to change the power equation in the Indian chocolate market.

February 4th, 2023

Halal Cosmetic

Name: Abdullah Al-Shuraim ID: 0804461 Group: S3G7 Instructor: Brian Thompson Contents * Executive Summary:3 * Overview of non-food Halal product:11 * Overview of Avon Cosmetics Company:13 * Avon Products:15 * Some of Avon Products:16 * Potential Product Summary20 * Process for Halal Certification21 * The procedure to make it a Halal Product is:22 * The procedure of Halal Certificate:23 Changes or Improvements for Launching Halal Product24 * Define three different market segment for Kuwait market place25 * Mission & Vision and How might be affected by new Halal Product:28 * Providing the same quality of service to existing customers30 * Major Promotional Activities & RMOI:32 * One Year Budget and ROI:36 * Competitors:39 * Communicating the changes in the Current Operations with Introduction of Halal Product:41 * Recommendation:42 * References:43 Executive Summary: 1. Avon Overview:

Avon is a very successful and leading global company in the cosmetics industry. It was founded in 1886 by Mr. McConnell. When Mr. McConnell was selling books he used to make his own perfumes and he used to give them to his customers, then he realized that the customers likes his perfume and it was one of the reasons why they are buying his books, so he decided to make his own cosmetics company and now Avon is one of the best cosmetics company in the world. Avon Company was renamed after a river that runs through the English midlands.

Avon CEO is Andrea Jung who committed to make Avon the most wanted company by women and also to satisfy the need of women globally. The main product are beauty products and fashion jewelry and also Avon has many brands that comes under the name of Avon such as Avon color, anew, Advance techniques, skin-so-soft, Avon naturals and Mark. Avon is the faster growing market on China and Russia which means they are doing a good and successful business. 2. Recommendation of Halal Product in Kuwait market Launching Halal product in Kuwait will be a very successful idea because of many reasons. . Kuwait is an Islamic Market b. Kuwaitis always seeks for Halal product and they are loyal to this type of products c. Kuwait is a trendy market which means word of mouth might make the company one of the biggest company I Kuwait market and by launching Halal product that will be a good reason to make people in Kuwait talk about your products and that will help us to sell more, increase product awareness and get the market attention 3. Who are the three market segments? A. Demographic: Age| 18 – 30| Gender| Females| Income| Above 500 K. D| Religion| Muslims| B. Psychographic:

C. Behavioral: We will be focusing on the usage rate because women who use makeup and cosmetics more than other because they have more occasions so these will be focused on and also brand loyalty because there are some women when they like a certain brand of makeup they don’t tend to change it and they became loyal to this brand and this type of women who we are looking for.

Also Occasions is one of the important parts of behavioral segment because there are women who don’t use make unless they have an occasion and this type we can satisfy them by offering them promotions for a whole set of cosmetics and they will have the opportunity to buy it and keep it till they use it. 4. What changes and improvement to current organization with launching new Halal product A. Kuwaitis have their own taste in some of the fragrances and perfumes and adding “Bokhor” smell to the fragrances and perfumes will a very good step in Kuwait Market. B.

Also since our products are Halal product we might add some “Henna” which is a planet with a nice smell and Kuwaitis also put “Henna” on their hairs often and they believe that it helps the hair to be stronger, better smelling and shiny. C. We must create a website in Arabic so customers can read all of the ingredients and what are our products made of in Arabic so they can trust us and feel safe. D. We will use some Kuwaitis celebrities to represent our makeup and do some commercials for us. E. Customer Service is a very important thing that we have to look after and we will be collecting our customer’s Mobile number r emails so we can inform them if we have any promotions or discounts. F. Since we will be doing some commercials and advertisement for our new Halal product we must have an Arabic advertisement and also an English advertisement. G. We will be publishing flyers that shows how Halal cosmetics are better than regular cosmetics to increase the target market awareness. H. To ensure that the team or the employees are working affectively we will set a commission for each clerk so we can encourage them to work better. 5. ROI and ROMI for new Halal product ROMI: Promotion Method| Promotion Budget|

Events Promotions| 5,200 K. D| Media Promotions| 2,600 K. D| Internet Promotions | 750 K. D| Total| 8,550 K. D| Return On Marketing Investment| 17,100 K. D| As we can see the table shows each promotion method budget and also it shows the total budget for the Marketing plan in 8 months including the two pre launch months. It also shows you that the ROMI is 17,100 K. D because what are we planning for is in every 1 K. D we pay for promotions we want to get 2 K. D for example, When we budgeted 5,200 K. D in the Event promotions we want to make sales of 10,400 K. D and we did that because after making sales of 10,400 K.

D we have to pay all of our expenses and we will have the rest as a profit. The best way to make sure that you are making profit is to make sure that the ROMI is 50% or above. ROI: Sales| 133,000 K. D| | COGS| 80,000 K. D| | | | 53,000 K. D| Gross Profit| 53,000 K. D| | Expenses: * Sales Expenses: 13,700 * Operation Expenses: 6,000 * Financial Expenses 5,000| 24,700 K. D | | Net Profit| | 28,300 K. D| This table shows the sales we make for a period of 14 months, how much did we pay for the goods or product we sell and it shows what expenses did we have and how much each one of them cost us.

Also as you can see it tells us how much profit we make over one year. We calculate that by taking how much sales we made minis how much did we pay for the product we sells and then we will get the Gross profit. Then we take the Gross Profit minis Total Expenses and we will get the Net Profit which means the money we make over a period of time which is in our case 14 month. 6. Promotional Activities of New Halal product Main Promotional Activities: Event | October| November| December| January| February| March| April| May| Cost| Exhibitions in Mall| | | | | | | | | 3,200 K. D|

The successful companies are the companies that focus on the new product and also they still focus on the old product and they know how to communicate the changes that happens to the current operation in the organization. For our company we will have 5 main steps to be able to communicate the changes. Who? 1. Employees 2. Management 3. Board of Directors 4. Clients or customers if necessary How? 1. We must communicate through many channels such as writing, intranet of the organization and training and explain more about the change 2. We have to give enough time for people to ask question and know more about the change 3.

We have to clearly explain the Vision, Mission and the objectives of our company 4. Explain the reason of the change clearly and what that might benefit the company and the clients Overview of non-food Halal product: Halal has become a very famous word specially for food industry, Hala could extends non-food products such as personal care, cosmetic, pharmaceutical and other consumers goods. Halal is an Arabic word, meaning lawful, and is the Islamic dietary law that identifies food permitted for Muslims. Non-halal is also referred to in Arabic as Haram (meaning not permissible).

Halal word comes from Al. Shareyah law or the religion law. Halal in general means that the food is clean, safe and good quality. In Islam everything is Halal except the harmful things and things that might harm. Also in Islam any food or drink comes in the middle area between halal and haram it’s called ‘Shobha’ and Muslims should avoid consuming Shobha foods and drinks until the label of the food or drink becomes clear. In Malaysia, the definition of halal food is provided by the Malaysian and they have standards of halal food such as storing, handling, ingredients and production.

Why does halal products and food are so famous nowadays even in the non-Muslim countries? The answer is because Muslims are all over the world there are Muslims everywhere and they considered a large segment of target market and if we could produce a product that may attract all of the Muslims in one spot to my product that will be a very big success to any company and that what many companies tried to do and now it become a very successful business and Halal is recognized world-wide. Kuwait is an Islamic country and it follows the Quran and Shariyah law which means that non-halal products are not allowed in Kuwait.

In order to import goods such as personal care, cosmetic, pharmaceutical and other consumer’s goods it should be halal according to the law in Kuwait and Shariyah law. Now cosmetics industry is getting bigger and they are making a very good business in all over the world. And also because people in all over the world have become a very specific about the cosmetics ingredients and caring more about what are they made of, we must come up with a very good solution that insure the customer a better cosmetics ingredients and could attract more consumers to the product and increase the market share and be more widely.

Overview of Avon Cosmetics Company: Avon is a leading global company was founded in1886. Avon caters to the cosmetics demand of women across all over the world. Avon Company follows a certain marketing policy in over than 130 countries through million of Avon representatives. Avon has a unique line of cosmetics product. Most of these products include fashion jewelry, apparel, and beauty product. The well recognized brands launched by Avon are Avon color, anew, Advance techniques, skin-so-soft, Avon naturals, and mark the company has its presence in over 135 countries.

It is the faster growing market in china and Russia. Almost all the products are sold to the retail stores. The skin care product line comprises bath and skin lotions, anti-aging cream, perfumes, lipstick, only to name few. Avon is one of the best cosmetics company in the world with over $6 billion in annual revenue. When the company began it began as the California Perfume Company. The founder of Avon cosmetics Company is Mr. David McConnell. He discovers that people were buying his books because he was giving them a rose oil perfumes. In 1939, Avon was renamed after a river that runs through he English midlands. Avon produces makeup, bath and skin lotions, anti-aging cream, perfumes, jewelry, clothing, cosmetics and toys. Now Avon products are sold in over 135 countries all over the world.

The main target for Avon is women, but even though now they are manufacturing product for children. Although Avon products are sold in shops and retails outlets, but many of them are also sold by being marketed as door to door through “Avon Ladies” or Avon Representatives. The company chairman and CEO is Andrea Jung, who was promoted to this position in 1999. Avon Strength and weaknesses: * Strength: * It gains a huge profit every year That tells us that Avon is a very successful company and there are many demands on its product * Avon is one of the best names in Cosmetics Industry. Avon is the fastest growing market in China and Russia and that tells us that Avon is one of the best names in Cosmetics Industry.

* Avon company has a very successful history Avon was founded in 1886 and they’re still doing business which means they have a very great history and that what makes them still doing business. Avon Cosmetics are high quality cosmetics with a possible price Avon has a big responsibility towards the clients because Avon promised that they will provide the best cosmetics with a very high quality and that consider as a strength and also what makes it better that the price is not expensive. * Avon has a very good reputation in the market. Avon is a well-known company world-wide and it’s a very famous company as we mentioned before its revenue reaches $6billions annually. * Weaknesses: * Avon Fake Product Many companies are selling fake product and pretending that they represent Avon * Internal Operating problems:

There was many compliant about Avon because of the Internal operating problems such as order were taken, but not filled, packaging wasn’t enough also the internet wasn’t used as a marketing and selling tool since Andrea Jung changes all the problems and fixed them, however there are few things must be fix ed. * Old Product: Even though Avon are developing new products every year, but there are still product that Avon produce and no one want to buy them and there are some studies that tells us that these old product are causing a loss in the profit because of the wasted money that are spent on the marketing, packaging and buying the supplies . Few Product Variety: As we can see most of the companies that comes to the industry after Avon such as Unilever, and Procter are offering a variety of product, while Avon has a focused product line and they are over focusing on it. Avon Products: Avon cosmetics are famous and they have achieved the bestseller in many countries over the world. Avon products are available in many countries and in many shops in more 130 countries all over the world. The ingredients that Avon uses in their product are high quality ingredients and also they have committed to provide Avon clients the best product in the market.

Avon believes that all the women in the world deserve the best quality and the best cosmetics product and that what Avon is looking for. Since Avon is a women company as they name their self we believe that their product are meant to be for women and their product is exactly what women all over the world is looking for. Avon has many products and many products line, they have lips, eyes, nail and face cosmetics and also they have beauty tools and beauty gift sets. However, Avon has many brands of their product such as, Anew Beauty, Avon Color, Extra Lasting, Healthy Makeup, Ideal Shade, Jillian Dempsey, Nail

Expert, Perfect Wear and Smooth Minerals. What makes Avon a very special cosmetics company is that Avon has many healthy product and they are also care about the health so Avon is a part of Breast Cancer Crusade and also Avon is against the domestic violence. The people who sells Avon products or Avon representatives are trained very well to know all the ingredients of each product that Avon sells and they have a good products knowledge, so when a customer ask any question or need a recommendations Avon representatives will be more than happy to help him and guide him to the best cosmetics on the planet.

Some of Avon Products: The Product Name| Price| Description| Ingredients| Colors| Picture| ANEW Age-Transforming Compact Makeup| $15. 00| With 4D Wrinkles Reverse Technology. Skin looks younger, even after you take makeup off. Minimizes fine lines, wrinkles and age spots. Water-based for ultra-fresh feel. Natural radiant finish. Medium coverage. | WATER COCOS NUCIFERA (COCONUT) FRUIT JUICE OLEA EUROPAEA (OLIVE) LEAF FRUIT EXTRACT BENZYL ALCOHOL NYLON-12 DIMETHICONOL GLUCOSAMINE HCL ALUMINUM DIMYRISTATE TITANIUM DIOXIDE/CI 77891 MICA/CI 77019 IRON OXIDES| | |

The Product Name| Price| Description| Ingredients| Colors| Picture| Healthy Makeup Concealer| $8. 00| Radiant color makes your entire look come alive. Healthy Makeup is infused with skin-loving nutrients. | WATER/EAU CYCLOPENTASILOXANE TRIOXAUNDECANEDIOIC ACID PHENYL TRIMETHICONE DIMETHICONE GLYCERIN SODIUM CHLORIDE SORBITAN SESQUIOLEATE ETHYLHEXYL METHOXYCINNAMATE GLYCERYL BEHENATE PEG/PPG-18/18 DIMETHICONE DISTEARDIMONIUM HECTORITE OLEA EUROPAEA (OLIVE) LEAF EXTRACT PYRUS MALUS (APPLE) ROOT EXTRACT PUNICA GRANATUM FRUIT JUICE | | |

The Product Name| Price| Description| Ingredients| Colors| Picture| Healthy Makeup Lip Conditioner| $3. 0| Healthy makeup The essence of a beautiful look. A fresh face. Vibrant eyes. Rosy lips. It lets your natural radiance shine through and your true beauty come alive. To your skin’s health and radiant beauty Jillian Dempsey, Avon Global Creative Color Director & Hollywood Makeup Artist| Active IngredientOctinoxate 7. 5% Other Ingredient: DIISOSTEARYL FUMARATE BARIUM SULFATE SQUALANE POLYBUTENE OZOKERITE MICROCRYSTALLINE WAX/CIRE MICROCRISTALLINE DI-C12-15 ALKYL FUMARATE POLYETHYLENE ZEA MAYS (CORN) STARCH CETYL ALCOHOL PETROLATUM PUNICA GRANATUM FRUIT JUICE GLYCINE SOJA (SOYBEAN) OIL

OLEA EUROPAEA (OLIVE) LEAF EXTRACT ALOE BARBADENSIS LEAF EXTRACT RETINOL COLLAGEN | | | The Product Name| Price| Description| Ingredients| Colors| Picture| Healthy Makeup Lipstick| $9. 00| Healthy makeup…the essence of a beautiful look. A fresh face. Vibrant eyes. Rosy lips. It lets your natural radiance shine through…and your true beauty come alive. | Active Ingredient: OCTINOXATE 7. 5% Other Ingredients: DIISOSTEARYL FUMARATE SQUALANE POLYBUTENE BARIUM SULFATE OZOKERITE MICROCRYSTALLINE WAX/CIRE MICROCRISTALLINE DI-C12-15 ALKYL FUMARATE POLYETHYLENE ZEA MAYS (CORN) STARCH CETYL ALCOHOL

PETROLATUM | | | The Product Name| Price| Description| Ingredients| Colors| Picture| AVON PRO Color and Gloss Lip Duo| $10. 00| Luscious shine wrapped in rich color. Lipstick on the outside, lip gloss on the inside. Wear each alone or both together…3 looks in one! Multi-dimensional color and shine. Lips look and feel moisturized. Lipstick, . 07 oz. net wt. Lip Gloss| LIPSTICK: RICINUS COMMUNIS (CASTOR) SEED OIL POLYGLYCERYL-2 DIISOSTEARATE SQUALANE GLYCERYL TRIACETYL HYDROXYSTEARATE MYRISTYL LACTATE OZOKERITE MICROCRYSTALLINE WAX/CIRE MICROCRISTALLINE LIPGLOSS: DIISOSTEARYL FUMARATE

TRIISOSTEARYL TRILINOLEATE TRIISOSTEAROYL POLYGLYCERYL-3 DIMER DILINOLEATE POLYGLYCERYL-2 DIISOSTEARATE/IPDI COPOLYMER SUCROSE ACETATE ISOBUTYRATE VP/HEXADECENE COPOLYMER BIS-STEARYL CAPRYLYL GLYCOL | | | Potential Product Summary After studying the market in Kuwait and studied the product of Avon we decided that the products we want to bring to Kuwait are lipsticks and lip treatment products. This type of product has a very big demand in the world especially in the Middle East. A study in 1937 survey revealed that over 50% of teenage girls fought with their parents over lipstick.

This means that lipsticks have been a very good product for the companies to sell since lipsticks has a strong demand in all over the world. Even in Kuwait, after we studied the market in Kuwait we found that most of the women and girls buy lipstick and they prefer to buy lipstick more than buying any other cosmetics. During the Islamic Golden Age the notable Arab Andalusian cosmetologist Abu al-Qasim al-Zahrawi invented solid lipsticks, which were perfumed sticks rolled and pressed in special molds, and he described them in his Al-Tasrif. That shows us the importance of the rouge and lipsticks in the Arabian Culture.

Also after studying the market in Kuwait and the demand of the lipsticks we found that the ages who uses lipstick are from 13-35 years old which means a bigger target market for us and this is a very good number and if we succeeded in getting 20% of the market interesting in our product we will be making a very good sales and making a good number of revenue. Also one of the reasons why did we choose lipsticks is that lipsticks are used everyday not like other cosmetics and make up which are used in a special occasion and that increases the demand of lipsticks in the country pecially in Kuwait because most of the girls and women here they don’t get out of the house unless they have some make up on which shows you the importance of the makeup and cosmetics in Kuwait Market. The last reason why we choose lipsticks and lips treatment product is that Avon Company has many types of lipsticks and many varieties of lipsticks. That’s an advantage for us because we will bring many types of lipsticks so we can satisfy all the needs and wants of the customers who wants lipsticks and we can offer them more than one type.

Also we will be bringing eyes products such as eye liner, mascara and eye shadow. These products also have a strong demand in Kuwait market and the eye product is as much important as the lips products. That’s not all, we will also bring some make up special product such as foundation which is so important in Kuwait market since the women use it a lot for wedding and other occasions and also blush because it’s also used in the same occasions and even more. In Kuwait Kuwaitis care about perfumes and fragrances so much and I believe that bringing this product to Kuwait market will be the best choice as a beginning.

After we launch these products we will be launching more products such as bath and body product, skin care products and hair care products. Process for Halal Certification Even though there is a long hard procedure to follow in terms to certificate your product as a halal product, but it worth it. First of all since we are going to sell our product in Kuwait and Kuwait is an Islamic country we have to sell a halal product and we can’t sell anything that has“haram” ingredients. Also to have a halal product, this will improve the brand image in the market and internationally.

Also Halal certificate will help us exploring the cross border trade opportunities and it could obtain us the advantage to be better than our competitors and have a competitor advantage. Halal certificate also will help us attracting more customers not only in Kuwait, but internationally also and Halal insignia is a trustworthy and autonomous and dependable. The procedure to make it a Halal Product is: First of all no food served inside the factory to make sure that the factory is always clean.

Second, only Halal Ingredient should be in the product and there are no “Haram” ingredients in it. To make the product Halal it should be: * Free from Alcohol or wine for food. * If it’s not food the alcohol content in the finished product must be less than 0. 5%, but it is better to keep it less than 0. 01%. * Free from filth * Free from animal part, except what has been approved as “Halal”. * Free from animal fat such as, enzyme, emulsifier and other fats except what is “Halal”. * Free from pork or dog

Gelatin / Kosher Gelatin | Haram| Soya Protein | Halal| The above is a list of some of the known ingredients only. Source : Islamic Food and Nutrition Council of America| The procedure of Halal Certificate: First we have to fill the application forms and supporting documents includes a detailed of the company’s profile and the local authority’s license, also we have to inform them with all the ingredients that in the product, the address of the manufacture and the name or the suppliers of the ingredients name and address.

Also the original status of ingredients, packaging materials, manufactures process and procedures. Second, we have to pay full payment of the certification fees before the inspection and we have to succeed in the physical site inspection includes inspection of storage, ingredients, production, general hygiene and quality control. Third, a report will be sent to the evaluation committee and recommendation and then the report will be tabled and evaluated by a committee for issuing Halal Certificate.

Then they will give us a validity period of the certificate is only for two years. Then it will be carried out the Halal conformity through inspection, constant monitoring by surprise visit or calling the companies involved. Changes or Improvements for Launching Halal Product Because Kuwait market is an Islamic Market and they follow the rules of “Alshariyah” that means they usually eat, drink, wear and buy Halal products and the demand on Halal product is huge.

Also on the other hand the demand in Kuwait market for the cosmetics is also huge and strong as in Kuwait cosmetics is used every day and its one of the important priority for women and teenagers in Kuwait. If we could take a product with a high demand on it such as cosmetics and turn it to Halal cosmetics and also introduce it in an Islamic market such as Kuwait market, you will be doing an excellent business. If we see the demand and supply we will find that the demand of Kuwait market is cosmetics product and they are also demanding Halal product, but unfortunately they didn’t have the opportunity to find Halal cosmetics.

Now we will be supplying their demand by offering them Halal cosmetics and if we just monitor the marketing mix well we will be doing a very good business in this market. Every business has its own special marketing plan and strategy to attract the customer and to grab their attention. Every company has its own way how to make the product and all of the marketing mix works with each other in terms to be successful company and to make more sales and profit.

There is one important thing that not many of us might be aware of it, which is there might be some changes required to be successful in that market and as we know not all the markets are the same and any strategy that works in a certain place or market might not work in another place. For example when Cheetos Company for cheese curl wanted to expand in China they did not study the market well and after introducing the product in china they was shocked with the big failure they have faced. The reason why Cheetos Company failed in this market is because they didn’t do some changes.

In China cheese curl is not famous and even though when they tried it they didn’t like it. After Cheetos company realized the problem they have done a research to find what are the best flavor for China market and they find that Strawberry, blueberry and BBQ flavored are the best to suit this market and when they changed the flavor they succeeded in this market. For our business we also will make some changes since we studied the market well and we think these changes will attract more customers to our business and make it a successful business. 1.

Kuwaitis have their own taste in some of the fragrances and perfumes and adding “Bokhor” smell to the fragrances and perfumes will a very good step in Kuwait Market. 2. Also since our products are Halal product we might add some “Henna” which is a planet with a nice smell and Kuwaitis also put “Henna” on their hairs often and they believe that it helps the hair to be stronger, better smelling and shiny. 3. We must create a website in Arabic so customers can read all of the ingredients and what are our products made of in Arabic so they can trust us and feel safe. 4.

We will use some Kuwaitis celebrities to represent our makeup and do some commercials for us. 5. Customer Service is a very important thing that we have to look after and we will be collecting our customer’s Mobile number or emails so we can inform them if we have any promotions or discounts. 6. Since we will be doing some commercials and advertisement for our new Halal product we must have an Arabic advertisement and also an English advertisement. 7. We will be publishing flyers that shows how Halal cosmetics are better than regular cosmetics to increase the target market awareness. 8.

To ensure that the team or the employees are working affectively we will set a commission for each clerk so we can encourage them to work better. Define three different market segment for Kuwait market place Before we complete our study we should divide the customers into different categories, so we can know what are the expected demands are and so we can meet need or want of these customers. Since satisfying all the customers is almost impossible, so we have to divide the customers into different groups and after dividing them we have to select a part and try to meet the need and want of this part.

Now how can we divide the market or split it? We can group the customers based on 3 main groups 1. Geographic 2. Demographic 3. Psychographic 4. Behavioral Now I will discuss three of the segments and I will rank them based on their viability and likely contribution to the business. 1. Demographic: Age| 18 – 30| Gender| Females| Income| Above 500 K. D| Religion| Muslims| We choose the age of 18-30 because from 18- 25 are likely to buy most of our products and because most of them are in Colleges and universities they will use it more.

And from 25-30 are likely to go for weddings and in Kuwait they must have makeup on them when they are going to wedding and that why we will be focusing on this age group. Cosmetics are used by females and also Avon Company is a women company so we will be focusing on women and tries to satisfy their needs and wants. The income should be above 500 K. D because women who have an income which is below 500 K. D will not be able to buy from Avon because they will have a more important priority to do with their salaries and they will prefer to buy from other shops that cheaper than Avon. 2. Psychographic:

We will be focusing on the interest because women who are interested to attend social meeting and family gathering which are a very important part in our society will be more likely to buy make up because this type of women use it more than others. Also we will be focusing on the opinion because we don’t sell only cosmetics, we sell Halal cosmetics and that might make a difference on people who thinks and believe that Halal product are better than other regular product and we will be focusing on this type of women because they care about the ingredients and how did we make our products. . Behavioral: We will be focusing on the usage rate because women who use makeup and cosmetics more than other because they have more occasions so these will be focused on and also brand loyalty because there are some women when they like a certain brand of makeup they don’t tend to change it and they became loyal to this brand and this type of women who we are looking for.

Now if we want to see which segment is more likely to buy my product and ranking them from one to three, Number one will be Demographic segment because they are likely to buy my products since the religion is included and Halal product means that this product is the best product for Muslims and also because they are women and the age of 18-30 is the best age to buy from us.

Second, Psychographic women who are interested in family gathering and social meeting and gathering are likely to buy our product more than the others because they use the makeup more than others and those whom we want to attract and they will be likely to buy our product because we can offer them special discount and promotions if they visited us more and more.

The last one is Behavioral because women who uses the cosmetics based on usage rate and brand loyalty won’t buy our product so much because cosmetics products isn’t used for one day, it’s used for a period of time and we want women who use more so they will buy more and this is the reason why behavioral segment comes in the last place. After segmenting the market, now we can say that our best customer is a Muslim women between 18-26 years old who is interested in social activities and meeting and also interested in family gathering with an income above 500 K.

D and she thinks that Halal cosmetics are better than regular cosmetics because they don’t have Haram ingredients and it is been produced and manufacture in a better way. Mission & Vision and How might be affected by new Halal Product: Avon Vision: To be the company that best understands and satisfies the product, service and self-fulfillment needs of women—globally. Avon’s Mission: The Global Beauty Leader Avon Company will build a unique portfolio of beauty and related brands, striving to surpass their competitors in quality, innovation, and value, and elevating our image to become the world’s most trusted beauty company.

The Women’s Choice for Buying Avon Company will become the shopping destination for women, providing a personal, high-touch experience that helps create lifelong customer relationships. The Premier Direct Seller Avon Company will expand their presence in direct selling, empowering women to achieve economic independence by offering them a superior earnings opportunity as well as recognition, service and support, making it easy and rewarding to be affiliated with Avon. The Best Place to Work

Avon Company will be known for their leadership edge, including their passion for high standards, their respect for diversity, and their commitment to create exceptional opportunities for professional growth so that associates can fulfill their highest potential. The Largest Women’s Foundation Avon Company will be a committed global champion for the health and well-being of women through philanthropic efforts, with a special focus on breast cancer, domestic violence and women’s empowerment. The Most Admired Company

Avon Company will deliver superior returns to our shareholders by tirelessly pursuing new growth opportunities while maintaining our commitment to be a socially responsible, ethical company that is watched and emulated as a model of success. When Avon Company introduced the Halal cosmetics many things were changed in the Vision and the Mission of the company. This step has given the company an opportunity to prove that Avon Company is a real Women Company and they care about women. By introducing Halal product they have attract more customers to their brand name.

Every company has its own Vision and Mission and now we will see what did the Halal cosmetics change in the Vision and the Mission? Halal cosmetics have changed the company to be a better company that cares about all the religions and try to have the best ingredients and satisfy the women needs globally. By providing Halal cosmetics Avon proved what they have promised when they said they wanted “To be the Company that best understands and satisfies the product, service and self-fulfillment needs of women— globally. Halal products have worked in make the Avon Company image better and trustworthy and also it helps the company with their mission such as being the most admired company and also by introducing Halal product to the company they’re achieving their mission to be the largest women’s foundation and the women choice of buying and to be the global beauty leader. Providing the same quality of service to existing customers Customer service is a very important part that we have to focus on because customer service is in every purchase the customer does.

We all have stories with bad customer service and good customer service and we used to share it with others. We know that word of mouth could be the reason why customers always come back for your store or company or it could be a reason of loosing many customers by treating them poorly. Warren Buffett said: “It takes 20 years to build a reputation and five minutes to ruin it. To be honest with the customers is the best way to ensure a good customer service.

Being honest with the customers and communicating with the customers when there is any mistake that happens ensures you that the mistake will never happen again and this is an advantage of being honest. There are few steps if we follow them we will continue to provide continued quality of service. 1. Response quickly When something goes wrong we have to quickly call the customer and explain him what happened and explain him our company’s mistake.

If We have to communicate with a large number of customers, then we have to send them an email explaining them what’s the company’s mistake and we will send them an email because it’s faster if we are communicating with a large number of customers. 2. Set a Realistic Expectation If we promised the customers something that didn’t delivered as we promised, the customers will feel disappointed and we will lose their trust in our words and promises, so we must do what we have committed to do even if it takes some arm wrestling with other departments who want to launch a product to the market before its been ready. . Respect The customers are so important to any company, without them we will not have any company, so all of our staff should love the customers even though there are some customers who will push the limits, but with the philosophy of respecting our customer and appreciating him we will get the customers satisfaction and we will be providing good customer service. From Gandhi, “We must become the change we want to see in the world. ” How could we know if the customers are satisfied with our customer service or no? We have many ways to see if the customers are satisfied or no.

First, after purchasing we can ask them to do a survey for us and also by doing an annual survey is a good way to ask. Also a follow up calls from the call center department will be a good idea. Measuring our services is an important thing to do because it gives us the opportunity to improve our company performance or even to save our company of losing. We will do some steps to know if customers are satisfied or no. How can we keep the customer satisfied? We can keep the customer happy and satisfied by following also several rules.

If we follow these rules we will be able to satisfy the customers and ensure that they are happy with our services. 1. Service level: For the call center the first call is just like the first impression for the customer. The customers will know if the service is good or bad from the first call. Also for the shipment and delivery we must give a very good impression for the customer from the first day. 2. Response time: The response time is a very important tool we should use to ensure that our customers are satisfied and what we mean by response time is that when any customer has a question we should answer him as soon as possible.

This will help us to keep the customers satisfied. 3. Give the customer his time: Some of the companies tell their agents to keep the calls short, but this is not helping the company because this might send a wrong message to the customer, so we will be giving the customer plenty of time to feel free to ask about anything he want and also our agent will give the customers a full detailed answers. After doing all these steps we will be sure that we are provide the same quality of service to existing customers with the introduction of the new Halal product.

We will be launching the product in December 2012. In October and November these two months are pre launch months and we will be doing some exhibitions and advertisement on these two months to create product awareness before launching it. When we launch the product we want to reach the highest number of target market so we will be using the three major promotions to reach our target market on December. Event | October| November| December| January| February| March| April| May| Cost| Exhibitions in Mall| | | | | | | | | 3,200 K. D|

Trade Show| | | | | | | | | 2,000 K. D| For the Event we will be using this promotion in October before launching the product, December when we launch the product, January, March and May. We will be using two types of Events promotions. The first one is Exhibition in malls such as Avenues, Marina Mall and Al Fanar Mall. The second one is the Trade show where there are some exhibitions for cosmetics brand where many cosmetics brand rent a booth and promote their product. This table will show you what Event promotions we will use and when. Media October| November| December| January| February| March| April| May| Cost| Catalogs | | | | | | | | | 400 K. D| Magazines| | | | | | | | | 600 K. D| Radio| | | | | | | | | 1,200 K. D| Flyers| | | | | | | | | 400 K. D| For the Media Promotions we will be using 4 types of media. The first thing we will be printing some Catalogs of our product and a brief description of our company and what are the Halal Products. The second thing we will be doing some advertisement in some Magazine that targeted the women such as Laki Magazine, Al-Mara’a Magazine and Sayedati Magazine.

First we will be using Social Networks such as Facebook, Twitter, MySpace and YouTube. We choose this method because nowadays many people are being a part in the social networks websites and in Kuwait it has been a very attractive way to reach your target market. Also some of the social networks could offer you to advertise just for your target market. For example, if your target market is female age from 18 to 30 and their interests are Cosmetics, The social network can advertise your promotion just for the target you choose.

The second method we will be using is Blogs since now many people are interested in blogs and they can share their opinion and get new ideas. This method might be used to educate our target market about Halal Product and also we might use it to tell more about our products and company. This is table shows our promotional budget for 8 month before and after launching the product and also we have mention the expected ROMI for these 8 months. Promotion Method| Promotion Budget| Events Promotions| 5,200 K. D| Media Promotions| 2,600 K. D| Internet Promotions | 750 K. D| Total| 8,550 K. D|

Return On Marketing Investment| 17,100 K. D| As we can see the last table shows each promotion method budget and also it shows the total budget for the Marketing plan in 8 months including the two pre launch months. It also shows you that the ROMI is 17,100 K. D because what are we planning for is in every 1 K. D we pay for promotions we want to get 2 K. D for example, When we budgeted 5,200 K. D in the Event promotions we want to make sales of 10,400 K. D and we did that because after making sales of 10,400 K. D we have to pay all of our expenses and we will have the rest as a profit.

The best way to make sure that you are making profit is to make sure that the ROMI is 50% or above. One Year Budget and ROI: This table shows which promotions we are going to use for a period of 14 months include the two months of the pre launch period. This table shows in details which promotion we are going to use and when also it shows how much each promotion cost. Promotion Method| Promotion Budget For one year + Pre launch 2 months | Events Promotions| 7,000 K. D| Media Promotions| 3,800 K. D| Internet Promotions | 1,400 K. D| Educational Promotions| 1,500 K. D| Total| 13,700 K.

D| Return On Marketing Investment| 27,400 K. D| This table shows the promotional budget for a period of 14 months including the 2 months before launching the product. As we mentioned before in the report we always assume that our return on investment will be the double because we usually set a plan to get 2 K. D for every 1 K. D we invest in promotions and marketing. Sales| 133,000 K. D| | COGS| 80,000 K. D| | | | 53,000 K. D| Gross Profit| 53,000 K. D| | Expenses: * Sales Expenses: 13,700 * Operation Expenses: 6,000 * Financial Expenses 5,000| 24,700 K.

D | | Net Profit| | 28,300 K. D| This table shows the sales we make for a period of 14 months, how much did we pay for the goods or product we sell and it shows what expenses did we have and how much each one of them cost us. Also as you can see it tells us how much profit we make over one year. We calculate that by taking how much sales we made minis how much did we pay for the product we sells and then we will get the Gross profit. Then we take the Gross Profit minis Total Expenses and we will get the Net Profit which means the money we make over a period of time which is in our case 14 month.

Competitors: MAC: MAC Company is one of the best names in the cosmetics industry. MAC Company was founded in 1984 in Toronto, Canada by Frank Toskan and Frank Angelo. The MAC is a short cut of Make-up Art Cosmetics, but its known world-wide as MAC. Frank Angelo was a beauty salon owner and he come up with a makeup line that would be well with photography. The two owners use to cook the cosmetics in their own kitchen and most of their clients were artist, models, photographer. Strength: * Strong Brand Name * Brand Loyalty * Many Branches in Kuwait

Weaknesses: * Uncomfortable products * Potential skin irritants products * No anti-blemish products * Poor customer service * Not many Advertisement L’Oreal: L’Oreal is the world largest cosmetics and Beauty Company. It was founded in 1909 by the French chemist Eugene Schuller in France. L’Oreal has a variety of products such as hair color, skin care, sun protection, makeup, perfumes and hair care. L’Oreal reached the top 100 Brand in the industry which means it is one of the leading cosmetics company in the cosmetics industry. Strength: Many distribution channels sells their products in Kuwait, but they don’t have a store here * Many Advertisement * Many varieties of products line * Many products for men * Their product almost in every super market in Kuwait Weaknesses: * No experts in Makeup and no makeup artist * No store for L’Oreal they only supply other stores with their products * They are focusing on hair product and less focusing in cosmetics Threats: There are few threats that our company is facing from MAC and L’Oreal. 1. They have a good customer base Customers prefer to try something have been in the market for long time then trying new thing specially for cosmetics products so it might be hard for us to attract and get customers interested in our product 2. They might do promotions or discounts on the time we launch our product * They may fail our product launching because they might do discounts or huge promotions on the same time we launch our product in and that could distract the customers for noticing our products 3. They might introduce Halal Product Our competitive advantage is that we have Halal products, if they produce Halal products and launch it in Kuwait most of the customers will buy from them since they are well-known and have a big customer’s base. Communicating the changes in the Current Operations with Introduction of Halal Product: When any company introduce new product there will be many changes in the organization. The successful companies are the companies that focus on the new product and also they still focus on the old product and they know how to communicate the changes that happens to the current operation in the organization.

For our company we will have 5 main steps to be able to communicate the changes. Who? 5. Employees 6. Management 7. Board of Directors 8. Clients or customers if necessary How? 5. We must communicate through many channels such as writing, intranet of the organization and training and explain more about the change 6. We have to give enough time for people to ask question and know more about the change 7. We have to clearly explain the Vision, Mission and the objectives of our company 8.

Explain the reason of the change clearly and what that might benefit the company and the clients If we follow these 4 steps, we will be able to make a very good communication and all the people who works in the company will know why we are changing and how we will change and when also, so they will be on track with any step the company does and they will help to make the introduction of Halal product more successful. Recommendation: Avon Company is a very successful company in the cosmetics industry and it has a very long history in the industry.

Avon products are in more than 130 countries and that show us how big and successful the company is. I believe that Avon Company will make a huge success in Kuwait and even in the Middle East because Avon has the perfect products that satisfy the needs of Kuwait market the Middle East market. The Vision of Avon is to be the company that satisfies the needs of the women internationally and globally and by introducing Halal product they are proving to the people that Avon is the Number 1 Company that understands the women need and try to provide the products that satisfy that need.

The introduction of Halal Product will make a big change in the marker. Kuwait market is small and Kuwait community is also small and a word of mouth in Kuwait is doing a great job for the companies and organizations. By introducing Halal Product we will get the Kuwait market attention and many people will be talking about it and we will have very good product awareness by word of mouth and we will make a big success in this market since it’s an Islamic market and they are trendy people who like to try new things. References: http://en. wikipedia. rg/wiki/Halal http://www. npros. com/dir/avon/ http://www. avoncompany. com/aboutavon/index. html http://licence2halal. com/our-services/ http://www. malaysiahalalfoods. com/ingredients. html http://www. halaljournal. com/article/194/jakim-halal-certification-details http://www. scribd. com/doc/26155318/New-Product-Development-Strategy http://managementhelp. org/fp_progs/mkt_mod/market. htm http://managementhelp. org/fp_progs/mkt_mod/mrk_nlyz. htm http://www. netmba. com/marketing/market/segmentation/ http://samehar. wordpress. com/2006/05/29/a223/

February 4th, 2023

Aims and objectives of Waitrose

Table of contents

Waitrose aims:

Waitrose aims are their long-term targets that they would want to achieve by using their skills as a business.

One Waitrose aims is to double its 3.7% market share over the next 10 years by increasing the number of stores in the UK from 173 to 250 and strengthening its foothold in the north. Read about W aitrose aims and objectives

Waitrose Objectives:

Waitrose objectives are short term targets that they would want to achieve by using their skills as a business. Waitrose objectives help to achieve their aims

The following are some of Waitrose objectives that I will be covering:

Maximise profit

Develop their organic range

Develop links with local community

Motivate staff

Increase levels of customer service

Increase the number of branches in the North

Maximising profits:

This objective is one of the most important objectives that Waitrose want achieve. This needs a lot of team work by Waitrose stores. To increase profits, Waitrose must increase revenue and avoid costs, so that it would result in the highest profits. Before using a method to help maximize profits, Waitrose must consider the costs of the method and predict the turnover before starting something that would maximize profits. So, for Waitrose to maximize profits, the revenue must outbalance the costs. Waitrose would want to maximize their profits because they could later on invest more in the business, for example, opening more branches.

One way that Waitrose maximize profits is advertising, which involves TV, online advertising, etc. Advertising raises brand awareness and attracts customers to Waitrose stores, this can raise revenues that will help to increase the profits. However, before making advertising, there must be a prediction of the costs of advertising and how much brand awareness it will raise and then predicting the possible revenue.

Advertising also involves celebrity endorsement, where Waitrose celebrities Delia Smith and Heston Blumentha, the famous chefs that help Waitrose with most food advertising: TV, Internet website, online magazine, etc. Theses celebrities share their food recipes with Waitrose; Waitrose customers can collect recipe cards while shopping. The recipes show that Waitrose quality food can make quality meals, the cards are often placed near the foods that make up the recipe. This increases brand recognition to a level that the fans of the cooks would come to Waitrose, this introduces a new type of people coming to Waitrose, and this would increase revenues.

Having a Waitrose online website will make an alternative to shopping in store for customers. This method increases the number of people buying from Waitrose. Therefore, it would help in maximising profits. Most people that go to Waitrose are elderly people and busy professionals, but this does not apply to all Waitrose branches, it applies to the Otley branch and branches in some outskirts of cities. The website makes it more convenient for customers to shop, because they may not have the time or ability to go the store, but the online website makes it much easier for them to shop. This will ensure that Waitrose will not miss out any customers that want to buy Waitrose products, this will increase revenue, which helps to maximise profits.

Waitrose products are high quality and price, selling them will help to maximise profits, because it would generate revenues, for example, organic products are high quality which will also have high price and when organic products are sold, it would generate high revenue. Essential range products are not expensive, so they sold for much less than other products. Essential products were introduced the start of the recession and even people with low incomes would be able to afford to shop at Waitrose, this would increase revenues. These revenues coming from selling different ranges of products, outbalances costs which then maximise profits.

Waitrose would want high profits because they would want to expand and open more branches and become more multinational. This is like a chain reaction, where more Waitrose stores will help to maximize profits to expand more, which will bring more profits…. and so on.

Developing Organic range:

Waitrose has different ranges of organic products that are high quality, that’s why their customers go to Waitrose on regular basic. Developing the organic will possibly bring more customers to Waitrose, which would increase revenues that will help to maximize profits. Developing the range includes finding better links with local suppliers which costs less and has the same quality or better. A Better organic range means better products and so it increases customer satisfaction.

Waitrose organic products sometimes come from the area that Waitrose has a store in, for example, Otley. Some of Waitrose store source some of their organic products, but not all local areas have perfect quality of Organic products. Getting organic products from know perfect-quality suppliers ensures that all Waitrose stores has the same good quality organic products, this is important, because customers won’t have different shopping experience in different Waitrose stores. Also, this shows that Waitrose are dependent on local suppliers making links with them will help Waitrose get organic products and the linking with local suppliers will mean that suppliers have to advertise the “Waitrose®” in some cases; this would develop links with the local community, which then would raise brand awareness in the local community and people in the community would come to Waitrose and that would increase revenues, which will help to maximise profits.

Additionally, developing the organic range will make the range very large and customers would have more choice, this will make customers satisfied because of the more choice of good quality organic products. Also developing the organic range might bring more sells, this might slightly increase the market share.

One of the best organic ranges that Waitrose sells is called Duchy range, which has a very pure high guaranteed quality according to Waitrose customers. Developing it, will be adding more products to the range, this is likely to bring more customers. In September 2009, Duchy organic, which was started by Prince Charles, had agreed to an exclusive deal with Waitrose to stock the range, and to pay a small fee to charity. In return, Prince Charles has graced a number of Waitrose stores, and dined with senior Waitrose executives and their spouses. In August 2010, the Duchy range was launched with many new lines under the Duchy Originals from Waitrose brand. Also the duchy range is 100% British and the people that prefer that, would come to Waitrose.

Motivating staff:

This is about Waitrose employees and their motivation to work. For Waitrose to be successful it is vital that their staff to be motivated and well working within the business structure, so that Waitrose will progress well.

It is very important that Waitrose staff are motivated, because it will improve the quality of service to the customer, for example, if a staff member is directing a customer to a particular store section, if the staff member is not motivated, it will show the customer that the staff don’t care and it may cause customer dissatisfaction, so the customer won’t come back, however if staff are motivated and confidant, the customer would appreciate the service and may come back again to Waitrose. Also this may make loyal customers that constantly come back to Waitrose.

Customers coming back to Waitrose because of good service will increase revenue, which means it will help Waitrose to achieve their objective of maximising profits. This shows that when staffs are motivated, they can make Waitrose more productive and more efficient. When staff are more motivated they will be more likely to show up every day (high attendance) and this is likely to reduce staff absenteeism, which will also reduce staff turnover, this will reduce staff costs because if staff are present, Waitrose will not have to pay for a replacement staff to cover the period the staff is gone, so this will reduce costs, which again will help Waitrose to achieve their aim of maximising profits.

Overall, staff being motivated is very important and vital to Waitrose progress and customer satisfaction. In conclusion, if staffs are not motivated it will cause great disadvantages and Waitrose may not progress well, therefore objectives will not be achieved.

Develop links with local community

This is about Waitrose improving relationships with the local community and their contribution to it. It is good for Waitrose to support the community, because it will have a good impression on Waitrose, and it would raise brand awareness, so customers would come to Waitrose stores, this would raise revenues, which would help in achieving the aim of maximising profits.

Waitrose sponsors many local events, for example, in Otley, they sponsor the Otley carnival. One of the best links with the local community is the weekly farmers market in Otley, the food sold there has very high quality and Waitrose financially sponsoring farmers that produce this food will mean that farmers have to advertise the “Waitrose®” logo, this will raise brand awareness and show people that go to the weekly farmers market that the food quality in farmers market is the same as in Waitrose stores. This will make customers come to Waitrose, this increases revenue, which is good for profits. They also sponsor the Otley fayre, which includes many fun activities for families. Advertising the “Waitrose®” logo in the Otley fayre might make families come to Waitrose and this would increase the different types of customers that come to Waitrose.

Waitrose is constantly developing links with the local community, and the evidence for that is; Waitrose, every month donates £1000 between three local good causes the customers chose. When a customer shops at Waitrose, at the checkout, customers receive a token which then is placed in a box of a good cause. The more tokens the good cause has, the bigger donation it receives. This is called the “Community Matters Scheme”. This is a good deed to community and it would really show how Waitrose supports the community, also this would raise brand awareness locally and nationally.

So it appears there is equilibrium between Waitrose and the local community, Waitrose gives to the community and the community gives back.

Increase levels of customer service:

Waitrose would want to achieve this aim because they would want the improve ability to supply Waitrose customers with their wants and needs, this would make customers come back to Waitrose, and that would generate revenues that would help to maximise profits.

One way that Waitrose can increase customer service is by providing as many as possible self-check outs in conventional stores and big convenience stores; this makes shopping in Waitrose quick, easy and more convenient. This will improve the service given to customers.

Another way of increasing levels of customer service is having a “Customer Desk” in Waitrose stores, which deals with customers complains, lost property, product refunds, etc. This will make customers satisfied because if there is something wrong the “Customer Desk” will help make things right.

When increasing customer service, Waitrose train staff in different areas, for example, when directing them, dealing with customers, complains, etc. Therefore, it would leave customers satisfied, this may make customers come back to Waitrose.

So increasing on customers service will constantly and consistently exceed the customers’ expectations for Waitrose, this would make customers come back to Waitrose.

Increase the number of branches in the North:

Waitrose is generally popular and concentrated in the south of England and has few branches in the north. Gradually increasing the number of branches in the north will increase the number of customers, so this would increase brand awareness. Also when increasing number of branches in the north, this will help Waitrose make links with the community, which will increase brand awareness even further.

As seen below, Waitrose is very popular in the south because it has many branches:

Waitrose would be more popular if more conventional stores and convenience stores increase in the north, convenience stores are better in busy shopping areas like city centres, busy roads, market areas, etc., this is because they are used as convenient supplements to main shopping, so Waitrose will have all the essential ranges in their convenience stores. These stores do not cost as much and are easy to start up and will generate more revenues than the costs of store.

Conventional stores, which are the main stores, opening them is better in neighbourhoods that don’t have many stores around and away from big competitors like TESCO and ADSA. A main store would attract customers in the area that the store is in, and that would be really profitable for Waitrose.

Increasing stores in that fashion will generate high revenues that would out balance total costs and help to Waitrose to achieve their objectives of maximising profits. Also the sales that the stores bring are likely to increase the market share of Waitrose.

Additionally, Waitrose would have more customers and there reputation would increase. Increasing branches would extend the service to customers because it would be easy for customers to get to their nearest Waitrose branch, this also makes Waitrose branches for the economy easy to go to, which could gain Waitrose new customers, this makes shopping for customers more convenient and it would increase revenues. Also, increasing the branches in the north would classify Waitrose store to be national in England and Scotland. So overall, opening more branches in the north is a very important objective that Waitrose would want to achieve to become a more successful business.

February 4th, 2023

Employer branding

Table of contents

Footings of mentions

This study highlights the lifting consciousness for the development of Employer Branding construct and its benefits for the administrations in present competitory labor market. The struggle between effectual employer stigmatization and employees ‘ rights and satisfaction toward organisation has been examined in this study with specific focal point on the unethical and commanding consequence.

Introduction:

Employer stigmatization is the perceptual experience of employees ‘ about an organisation as a topographic point to work. It ‘s designed for motivation and procuring employee ‘s alliance with the vision and values of the organisations. From the HR perspective the construct was subsumed the older term INTERNAL BRANDING that was basically the procedure of pass oning an organisation ‘s trade name value to its employee.

Employer stigmatization

The construct of EMPLOYER BRANDING was created in the 1990s by Simon Barrow, who founded People in Business ( now portion of TMP Worldwide ) and was the co-author of The Employer Brand. 1 In the yesteryear, Barrow had been a consumer goods trade name director and headed up an advertisement bureau in London, but subsequently became the main executive of a enlisting bureau. He was instantly struck by the similarities between the challenges faced in advancing consumer goods and in advertising the strengths of an administration ‘s employee proposition. Both, he recognised, required a strong trade name, and so the construct of employer stigmatization was conceived. He defined employer branding as a set of properties which make the employees feel more close to the company and take pride of being associated with the company they work for. Employer stigmatization is in kernel the mental apparatus of an employee where he or she receives mental satisfaction in the same mode as when he or she uses a merchandise of a preferable trade name.

Employer stigmatization is hence a set of attitudes, every bit good as an array of activities and characteristics enabling the procedure of branding to be more effectual. They could be psychological ( behavior of higher-ups ) , economic ( compensation bundle, benefits ) or functional ( possible to turn, occupation assigned harmonizing to capableness ) .

These definitions indicate that employer branding agencies advancing and constructing an individuality and a clear position of what makes an organisation different and desirable as an employer. It has similarities with merchandise and corporate stigmatization but the cardinal difference is its ‘ more employment particular.

Recruitment and employer stigmatization

Developing an employer trade name is a combination of following vision, values, and behaviors, and presenting a service that shows committedness to outdo pattern and service excellence. It begins with the enlisting procedure that offers figure of tools that can be used to make perceptual experiences of an using organisation, these tools are:

Job advertizement and description
Interview procedure
Offer letters
Information battalion for new recruiters
Employee enchiridions
Initiation and preparation.

The enlisting procedure is an of import manner to construct a positive relationship between the organisation and employee. Throughout the process, the organisation can make a strong and positive position about them ; even it can be extended to unsuccessful campaigners as good.
When employees have accepted the earnestness and truth of the employer trade name, they will transport it frontward, actively advancing the trade name to co-workers and clients. However, employer stigmatization which is fundamentally untruthful will non work and is likely to be counter-productive.

Benefits of Employer Branding

Long-run impact: Successful employer trade name can hold a positive impact on enrolling for a considerable sum of clip while sing any Major PR issues.
Increased volume of self-generated campaigners: The figure of appliers tends to increase each twelvemonth as the employer branding gets stronger. Cases of a 500 % addition of applications have besides been observed.
Addition in quality of the appliers: The quality of campaigners will besides better dramatically ; persons who ne’er would hold considered in the yesteryear will get down applying.
Higher offer-acceptance rates: The rate of credence addition proportionally with the addition of image and good will of the company.
Higher Employee Motivation: Employees can be easy motivated, or will remain motivated longer in the company because of the sensed pride in working for the company, and better direction patterns ( by and large ) that is tied-in with the company ‘s trade name image, therefore doing it a company people work for because they chose.
A stronger corporate civilization: Employment stigmatization can assist beef up house ‘s corporate civilization because of the inactiveness it additions from the really kernel of employer stigmatization ; doing a company desirable to work for.
Diminished negative promotion and image: Effective stigmatization can nail jobs by covering with negative remarks and fixing effectual counter measurers.
Increased director satisfaction: As a direct consequence of increased involvement from more able and adept appliers, the directors will hold more clip for managerial maps as the demand to give more clip to recruitment procedure will diminish with the quality of the applicant group.
Healthy competition: Employer stigmatization is similar to merchandise stigmatization. Hence to maintain a company desirable, it has to update its UPS and maintain up with its promise of bringing. This increases healthy competition and besides makes the companies better by the minute.
Increased stockholder value: The ripple consequence of the company ‘s good will via employer stigmatization can besides positively impact a house ‘s stock monetary value.
Support for the merchandise trade name: If a company has a superb trade name image, it is more likely that its merchandise will harvest the benefits of it and be branded automatically. This helps particularly when the company launches a new merchandise.

The trade name kernel should sum up what the trade name stands for, going the karyon for merchandise development, all communications and even HR enterprises for employees. Its definition should besides be consistent with the corporate vision/mission and values.

For illustration, Volvo is a good illustration of a trade name description is Volvo – “Style, driving pleasance and superior ownership experience while observing human values and esteeming the environment.” Volvo ‘s values and associations reflecting this trade name individuality are what are considered to be typically Norse – e.g. “nature, security and wellness, human values, elegant simpleness, originative technology
and the spirit of stylish/innovative functionality” .

For Volvo, this description non merely mirrors the psycho-graphic profile of the ideal client for their autos, but besides summarizes what Volvo as a company means to all its workers — its employer trade name. These are intrinsic values that Volvo workers can associate to, what they believe in and why they feel comfy doing a committedness to their occupations. One can easy visualise the types of HR plans that would animate a sense of pride and re-enforce these intangibles – e.g. nature, wellness, security and other meaningful human values.

‘Living the trade name ‘

Life THE BRAND is placing with an organisations trade name value to such an extent that employees ‘ behaviors fit precisely to the image that the concern is seeking to portray to its clients ( Alan Price 2007 ) . The alliance between employees ‘ behavior and value of organisation ‘s trade name image is really of import. It is suggested that administrations need to guarantee that there is no spread between what the administration is stating in the outside universe and what people believe inside the concern. The employees should be perceived as Brand embassador and trade name selling would merely be successful if they LIVE THE BRAND.

From this position:

Organizations have encouraged employees to “buy in” to the concern vision and values.
They have to guarantee that everyone in the organisation clearly understand the intent of the common set of values.

Harmonizing to Ind ( 2004 ) , the subjects discussed are likely to be of involvement to HR and selling practicians every bit good as those involved in internal communications within administrations. Employees themselves are expected to internalize characteristics and facets of the administration ‘s trade name to guarantee that they become trade name title-holders, therefore assisting to stand for to administration ‘s trade name to the outside clients. Such an attack instantly raises some interesting jobs associating to equality and diverseness as it expects each employee to portion a peculiar set of values and act in conformity with these values.

The employee branding attack being recommended by Ind raises a figure of challenges for those interested in an equality and diverseness docket. An administration that aims to guarantee that employees are populating the trade name will specifically take to pull and enroll employees who already portion the values of the corporate trade name. Furthermore, those already employed within the administration will be encouraged to internalize the values of the administration. Clearly, there are jobs for promoting diverseness here, with one of the rules of diverseness direction being an credence and acknowledgment that people are different and single differences ( particularly of values ) should be welcomed. Inherently, a populating the trade name focal point is likely to travel against such a rule. Ind makes the point that promoting employee designation and committedness to the administration ‘s trade name values might deny an look of individualism. However, Ind suggests that internal stigmatization combined with leting employees to be empowered will enable freedom with order.

Denial of individualism ( dress codification policy )

When it comes to “ professional image ” , many employers are gaining that Standards of frock and personal presentation are indispensable therefore holding a policy on frock codification can be of import.

Where the employees meet clients, they act as the store window for the company and the benefits of presentable visual aspect are obvious. However, even where the employee ‘s work is internal, there are less touchable benefits such as:

Making a squad atmosphere,
Engendering criterions of professionalism, and
Making a corporate image.

As employers are gaining this, they are paying more attending to the visual aspect of their employees and the image and perceptual experience of the concern – frock, training and personal hygiene are all portion and package of this.

However, the issue of work topographic point frock codifications can be extremely controversial. It is critical that employers are cognizant of the favoritism issues that dress codifications can make.

Issues with work topographic point frock codifications

In administrations with uniforms, the issues can be more broad ranging. For case, at the Greater Manchester Police Force, bureaucratism and involuntariness to accept alteration has hampered the debut of hijabs for Muslim adult females.

At Inchcape Fleet Solutions – where all 140 non-senior staffs are provided with polo shirts or blouses branded with the company logo – the manner of the uniform does non accommodate all staff and most “ do non like have oning it ” . This would impact their tempers at work and accordingly affect their public presentation.

Ailments of favoritism

Furthermore, a ailment was raised informally by the staff forum of kid trust fund supplier Family Investments and relates to the fact that adult females can have on pants that are non full length, while work forces can non. Employees have requested that the company allows trunkss to be worn, every bit long as they are below the articulatio genus

Besides, in September 2006, a British Airways worker has been suspended and attended an entreaty over have oning a cross at work at Heathrow Airport. She claims the suspension is prejudiced, particularly since the air hose allows Sikh employees to have on traditional Fe bracelets and Muslim workers to have on headscarves.BA has said it will reexamine its unvarying policy in visible radiation of the media storm the narrative has provoked.
Employer stigmatization and favoritism jurisprudence

There are three countries of favoritism relevant to dress codification policy:

Sex Discrimination Act 1975
Religious or Belief Regulations 2003
Disability Discrimination Act 1995.

Sexual activity favoritism and frock codifications

There is the obvious potency for sex favoritism in any frock codification, which sets different demands for work forces and adult females. Past claims have challenged policies that:

adult females must have on skirts
work forces should non hold long hair
Work force must have on a neckband and tie.

The instance of Matthew Thompson who objected to the frock codification imposed by the Department for Work & A ; Pensions at his topographic point of work, a occupation Centre in Stockport, can besides be a good illustration. Mr Thompson claimed that the frock codification discriminated against male employees as they were forced to have on a neckband and tie whereas female employees could have on Jerseies to work. The Employment Tribunal found in favor of Mr Thompson saying that the frock codification was prejudiced as the demand to have on a neckband and tie was gender based and there were no points of vesture that were imposed on adult females in the same office.

From the Thompson instance, it became clear that employers should be careful in the manner that they draft their frock codifications. Employers are non prevented from enforcing frock codifications that require employees to have on specified points of vesture every bit long as the codification is drafted in such a manner as to be even-handed between work forces and adult females.

For illustration, occupations in the City, the current convention is for both work forces and adult females to have on suits. The convention is that a adult male should have on a tie with a suit but the same does non use to a adult female. A frock codification necessitating a “ smart suit ” could use to both sexes but be enforced in a non-discriminatory mode appropriate for each sex.

Religion/belief favoritism and frock codifications

A frock codification that requires employees to move in a manner contrary to their spiritual beliefs, hazards being indirectly prejudiced. Therefore, a frock codification prohibiting headdress will be prejudiced to male Sikhs, who must have on a turban.

The best manner to avoid these jobs is to be every bit non-specific as possible. A widely worded frock codification necessitating smart visual aspect, with non-binding illustrations of suited frock, can non fall foul of specific clothing-related beliefs.

To cross-check your frock codification against the chief faiths ‘ vesture beliefs, refer to Acas ‘ Guide on Religion and Belief which has a utile chart at Appendix 2 ( pages 40-50 ) .

It may be possible for employers to objectively warrant a frock codification contrary to any of these beliefs, if it can be done so objectively. For illustration, employees at a cocoa mill were successfully prohibited from holding face funguss for wellness and safety grounds. However, employers should be really wary of trusting on nonsubjective justification as the tribunals are loath to accept it.

There may be a inquiry grade in some instances whether a individual ‘s positions are beliefs. Harmonizing to Acas, Rastafarianism ( which requires the erosion of a chapeau ) is a belief system. Certain political beliefs or powerful sentiments such as nationalism ( the erosion of an American flag badge ) may or may non be regarded as beliefs. Employers should esteem beliefs that are strongly held whether or non they are spiritual in nature.

Disability favoritism and frock codifications

Disabled employees may non be able to follow with a frock codification, for illustration, an employee with a neck hurt unable to have on a tie. However, by and big, this demand non impact the manner the codification is drafted ; alternatively, employers should be sensitive in the enforcement of the frock codification.

In drumhead, employers should be rather a spot flexible when composing a policy on employee frock or visual aspect. Reasonable flexibleness and sensitiveness to the employees ‘ racial differences should be allowed in the frock codification to do employees comfy and any struggle and jurisprudence suits, while run intoing the Trust criterion of Dress codification.

This position is echoed by administrations such as Broker Network, which believes that employees should be able to do their ain judgements on what is best to have on.

Many companies are now turning their dorsums on the construct of ‘dress-down Fridays ‘ , choosing alternatively to ditch smart business-wear every twenty-four hours of the hebdomad. A study of 560 administrations has found that four out of five employers believe a more relaxed frock codification leads to greater productiveness. Nine out of 10 administrations that replied to the canvass by the Peninsula employment jurisprudence consultancy had declared ties an unneeded portion of their frock codification.

Decision

The issues discussed above create a challenge for HR professionals involved in employee focused branding undertakings, particularly those where employees are expected to portion a specific set of values. That is that such enterprises will doubtless make a tenseness and potentially conflict with rules underlying an equality and diverseness docket. Ind ‘s suggestion that inside-out stigmatization allows freedom and order remains unconvincing even when the employees are involved in building the trade name values. An administration that dictates a set of values for employees to internalize is still a homogenising force. Administration ‘s that truly take diverseness programmes earnestly will hold to undertake this tenseness. One possible manner out of this riddle is to include equality and diverseness consciousness as a cardinal value included in the internal trade name proposition.

Recommendations

Any guidelines should be carefully drafted, and employers are advised to handle any petitions to dress contrary to the company codification for spiritual or racial grounds with regard.

Employers should confer with the employee in inquiry and discourse how to suit sensible petitions, and seek to happen a favorable solution. A court will be more likely to be sympathetic to the employer where a policy is required for wellness and safety intents, instead than merely to keep a corporate image.

Decide what limitations on employees ‘ visual aspect are necessary and why. For illustration, instructors are expected to have on reasonable footwear, suited for the activities their occupation involves. Restrictions should non be inordinate or unreasonable, for case take a firm standing on suits or ties in the office when employees are non customer-facing.

Set out the guidelines clearly, and include the principle behind any limitations.

Explain why limitations may be placed on some employees but non others ( for illustration, no organic structure piercing for those runing heavy machinery for wellness and safety intents, and those working within a cafe of a supermarket may hold stricter codifications enforced on them than those who work in the same shop, but do n’t come into direct contact with nutrient ) .

Give employees notice of when the policy will come into force.

Allow employees a grace period before training for non-compliance.

Explain what will go on if employees are found to be in relentless breach of the policy ( disciplinary action and, potentially, dismissal ) .

Give the name of an person that employees can speak to if they feel they can non follow with the policy.

Current statute law on issues that could take to favoritism should be reviewed from clip to clip, and staff enchiridion should be read by employment attorneies to guarantee conformity. Guidelines should besides be updated to suit the statute law.

Base the policy on business-related grounds. Explain your grounds in the policy so employees understand the principle behind the limitations. Common business-related grounds include keeping the organisation ‘s public image, advancing a productive work environment, or following with wellness and safety criterions.

Require employees to hold an appropriate, well-dressed visual aspect. Even insouciant frock policies should stipulate what vesture is inappropriate ( such as perspiration suits, trunkss, and denims ) and any particular demands for employees who deal with the populace.

Communicate the policy. Use employee enchiridions or memos to alarm employees to the new policy, any alterations, and the punishments for disobedience. In add-on, explicate the policy to occupation campaigners.
Use the frock codification policy uniformly to all employees. This can forestall claims that the policy adversely affects adult females or minorities. However, you may hold to do exclusions if required by jurisprudence. ( See following suggestion. )

Make sensible adjustment when the state of affairs requires an exclusion. Be prepared to suit petitions for spiritual patterns and disablements, such as caput coverings and facial hair.
Apply consistent subject for frock codification misdemeanors. When training lawbreakers, point out why their garb does non follow with the codification and what they can make to follow

Mentions:

Edwards, M. R. ( 2008 ) Employees as a Focus of Branding Activities: A Review of Recent Contributions to the Literature and the Implications for Workplace Diversity, Equal opportunities international. Vol 27 ( 5 ) pp. 447-481 [ online ] Available from: www.emerald.com [ Accessed 1 April 2009 ]

Carrington, L ( 2007 ) EMPLOYER BRANDING [ Online ] Available from: hypertext transfer protocol: //globaltalentmetrics.com/articles/EB_2007_Brandempl.pdf [ Accessed 26 March 2009 ]

Wolff, C. ( 2007 ) Employers USE DRESS CODES TO ENHANCE CORPORATE IMAGE, IRS. Issue 878. Available from: hypertext transfer protocol: //www.xperthr.co.uk [ Accessed 26 March 2009 ]

Downes, J. ( 2007 ) POLICY CLINIC: DRESS CODES, [ online ] Available from:
hypertext transfer protocol: //0-www.xperthr.co.uk.lispac.lsbu.ac.uk/article/81919/policy-clinic — dress-codes.aspx? searchwords=Policy+clinic % 3a+Dress+codes [ Accessed 26 March 2009 ]

Millar, M ( 2006 ) EMPLOYERS RELAXING WORK DRESS CODE CAN HELP IMPROVE PRODUCTIVITY, [ online ] Available from: hypertext transfer protocol: //www.personneltoday.com/articles/2006/07/26/36558/employers-relaxing-work-dress-code-can-help-improve.html [ Accessed 26 March 2009 ]

Dr. Sullivan, J ( 2008 ) EMPLOYMENT Stigmatization: THE ONLY LONG-TERM RECRUITING STRATEGY, [ online ] Available from: hypertext transfer protocol: //www.drjohnsullivan.com/content/view/183/27/ [ Accessed 26 March 2009 ]
Stephen Morrall, S & A ; Urquhart, C ( 2003 ) SEX DISCRIMINATION – ARE DRESS CODES DISCRIMINATORY? [ online ] Available from: hypertext transfer protocol: //www.drjohnsullivan.com/content/view/183/27/ [ Accessed 26 March 2009 ]
Gronlund, J K ( 2008 ) HOW EMPLOYER BRANDINGCAN FOSTER TRUSTS AND LOYALTY? [ Online ] Available from: hypertext transfer protocol: //www.employerbrand.com/Points_pathf.html [ Accessed 26 March 2009 ]

February 4th, 2023

La Shampoo

La Shampoo is a high quality and more expensive product that has the same marketing strategy over years. From 1989, the line start to slowly decline its sales. The ad agency tried to develop new look campaign, but this solution did nothing for La Shampoo sales and customers didn’t even noticed the change. Caroline, the brand manager wanted a new marketing plan to improve the sales and increase the market share, not to just keep the product remain on retailer’s shelves.

She made a marketing meeting with Eric, her product sales manager, and Beth, the representative of the advertisement agency that held La Shampoo account, to discuss their recommendation. 1. Compete on Price : Eric’s solution is to reduce prices permanently as long as long term plan to save major accounts that in danger. Eric argued that the brand will died if we didn’t act very quickly and he saw his solution as a rescuer. Reduce prices is very helpful solution in supporting sales reps and increase sales volume at least for short time ,but it is not good in building the brand and increasing the brand market share for many reasons .

First of all, competing in the price could be very dangerous if other brands lower their prices too specially if they are offering benefits La Shampoo can’t provide, like “beautiful hair from natural sources”. Secondly , price- driven consumers are not loyal ,so they will go with another brand that is cheaper. 2. Strong Brand Campaign : Beth’s solution is to create new advertisement campaign. This solution seemed better to improve sales ,but there is still no specific changes Beth suggested to repositioning La Shampoo on the customers’ minds.

This solution is good if the marketing researches found out the causes of the sales’ decline. Then the new advertisement’s campaign should focus in repairing La Shampoo image and correcting the mistakes that happened in the previous years. So to obtain this solution marketing researches should be done deeply to better understanding customers . Facts About the Brand: * Brand that has been used mostly between its competitors in the category for two decades must have strong brand equity. * La Shampoo has boor brand management ,because they went from the problem to the solution without auses diagnosis. * Restaging the brand will require a lot of resources. * The alternative proposed by Marni Shin are likely to be too late , the competitor already filled the shelves with such a product . My Recommendations: After doing all researches and surveys needed on the target segment which I think is better to be women between ages of 15 to 50, I suggest two marketing strategies. The first one is for the existing customer base who still buy the product and doesn’t like changes.

The other one is for attracting new customer by introducing some values La Shampoo can produce to them. These two plans should consider the following: * * In doing the researches , should make sure about asking the right question to know the attitude for loyal and former users. * Today’s customers are very sensitive about the values they will get for each dollar they pay. So the advertising campaign must focus on the benefits consumer will have by using the brand such as healthy hair and easy style getting. La Shampoo slogan “For the Look and Feel of France ” is meaningless for the current environment, the people now don’t want to look French. * Some new trails and usages must be found for the brand to communicate them in the new ad campaign. * Keep some product lines without any change for whom already use the product and to keep the base customers. * The new advertisements should support La Shampoo in tapping new customers and protect the current users.

February 4th, 2023

Building Up Brand Awareness in a Social Media Context

Social media, brand awareness, micro blog, weibo Nowadays, we live in an era of information and communication bloom, not just locally but also on a global basis, in which each of us venerably is exposed to enormous messages, news reports, commentaries and features from different kinds of medium. Moreover, we not just the passive passengers of the information turmoil, in fact we do proactively participate into the game and become part of what we called social media, which changes the way how we perceive and shape the world around us.

There might be many definitions about social media, given the nature and broaden perspectives of it. According to ESOMAR (The European Society for Opinion and Market Research (ESOMAR), a global association for market, social and opinion researchers. ), social media is defined as “internet based platforms and technologies that permit users’ interaction and/or facilitate the creation and exchange of user generated content. ” Whilst the scope is evolving, the following format is focused and discussed: Multi-person/group communication and/or collaboration platforms (e. . Twitter) Note: arguably Sina. com might say Weibo is more than Twitter, but to make it simple we quote Weibo here is similar to twitter in some sense. The urgency of connecting consume thru social media With the emerging of social media and the growing popularity across different regions, we can now keep in touch with each other all the time, share photos and messages simultaneously to thousands or millions, and it’s also allowed brands to interact much more closely to their consumers – you and me. Marketing in this way has forever been changed by social media.

Marketers can engage with and influence existing and potential consumes through adverts or other format of effective communication tools specifically tailored to that type of person, all based on information the consumer has given out on a voluntary basis. Furthermore, if the instinctive nature of Social network is taken into the consideration which is the networking expansion down to different level, the brand messages received and responded by consumers would cast substantial influence over their peers in the network.

One of the key and productive initiatives or requirements for a marketing manager is to increase the awareness that could lead to preference, purchasing motivation or even brand loyalty. With the feature of easy access, speedy and broaden coverage and most important of all, the lower cost of average reach, marketing manager is now equipped a new perspective to market a brand to thousands of consumer, increasing its public awareness through pages and helping to cement the brands image with regular updates, photos, articles and more. The increasing outreach of social media

Social media witnesses its popularity or taking over around the globe in the past few years. Especially in China, a country with growing potential in internet usages and mobile internet, based on the statistics from <The 29th China Internet Development Statistics Report> from CNNIC, by the end of Year 2011, the number of internet user in China exceeds 500 million in which one-quarter of net users use microblog(Weibo). Basically, it’s hard to find someone not signed up to one social media page or another, and so it makes sense that companies have set up pages to market their products and services.

The first step is to increase the brand awareness over this interactive platform. In short, social media has access to all. On the other hand, many brands in China also rush to build up their corporate microblog to have the first trials of interaction with consumers. According to the statics from Sina. com, till the end of Feb, 2012, totally more than 130,000 companies have set up the official weibo over Sina. com. Interesting thing is that among these companies, around half of them are coming from the dinning, i. e. restaurant, cafe or dining outlets.

Not surprisingly, when being asked in the survey about the intentions of stepping into the stage of launching the corporate weibo, 100% of these companies responded that the first priority is brand building, with PR and CRM on the second and the third places to follow respectively. Interactive way of exchanging brand information flow When communicating the messages, some of the key distinctive features about social media include two-way dialogues, interactive creation and speedy response. In the past, marketing managers frequently use the pre-set messages that fit into different segment to target their consumers.

Under these so-call old fashion ways of consumer communication, the messages are fixed and tailed made already, even the marketing managers could modify and even alter some fractions of the messages based on the judging of the change of the different situation. More importantly, this kind communication would be mostly in one direction, regardless the feedback from the receiver. In one way, social media allows users to interact with people and companies like never before, while also acting as an outlet to channel information about people and their opinions.

On the other hand, it enables consumers to talk directly to one another, which means, over the social media platform, the topic, the tone, the timing and the frequency of these conversations are now outside the marketing managers’ direct control. As a consequence, marketing managers of today must not just focus on the provision of the traditional messages, they should also understand the way of consumers speak of their mind to shape their discussions in such a way that it is consistent with the company’s strategy and communication paradigm.

When marketing managers set up a page on a social media site and people begin to follow it, they can ask these followers their opinions on the company’s products and services. On the very first stage, the information that can be gathered on these topics is invaluable, as it is essentially market research with the real information. Social media is a good platform with the mixed but advanced technology and full scaled of media features that enable instantaneous, real-time communication and applies multi-media formats, such as audio and video mediums.

All these, not just coming from local market anymore, it comes with global reach capabilities. An interesting fact reveals that so-called high carihighly educated All this information can easily be put to use in better marketing to customers, helping marketers appeal to their audience in much better ways than before. Promoting a positive image Any social media agency will tell you that keeping your brand image up on your social media page is crucial. Word spreads fast, even faster with social media, so when negative comments are posted about a particular brand on the page it can be swiftly tackled and the problem sorted.

Better yet, all of this being public will show other potential customers how your brand deals with problems. Facing off negative comments is great, but don’t forget that positive messages will also be posted. Marketing to the target market Today and in the past, marketing has been done through publications, signs, television and radio adverts. The target markets for these adverts are broad to try and appeal to as many people as possible as easily as possible.

While this is still effective, marketing through social media can be targeted towards a much more niche audience. Using the information that users post on their social media profiles, adverts can be made to target from either a broad range of people, all the way down to a specific group. This allows for a greater personalisation of adverts, appealing more towards people who’d ignore the normal adverts. At the opposite end of the scale, setting up adverts to easily avoid users that’d have no interest in the product or service is also possible.

February 4th, 2023

Online Reviews Are the New Social Proof

Table of contents

Consumers are influenced by other people more than they realize (or are willing to admit).

According to the , social norms influence consumption behavior and even private interests, including one’s taste in music. This is what makes the concept of social proof a powerful one.

What is social proof?

Science describes social proof as a psychological phenomenon in which people follow the actions of others in an effort to reflect what is considered correct behavior for any given situation — including online experiences. Simply put, social proof influences people’s decisions on how they should behave.

We’ve traditionally turned to a variety of useful sources as social proof. These include credible experts, thought leaders, celebrities, friends and the wisdom of the crowd. But today’s diners rarely go to a restaurant without first visiting Yelp, and shoppers seldom make a meaningful purchase without first reading what verified buyers have to say. Online reviews have significant effects on purchasing behaviors. Predictably, they’ve emerged as one of the most potent forms of social proof.

When customers read reviews on sites such as Yelp, Google, Amazon or TripAdvisor, they depend on star ratings to determine the quality of a product or service. They read others’ comments and ask increasingly specific questions.

“Will this bank location help solve my problem the way it solved others’ problems?”
“Is the food as good as advertised? What do previous diners really think?”
“How long will I have to wait before I see the doctor? How long did others have to wait?”
“Based on others’ experiences, what potential issues or problems might I have to face when I decide to buy this product?”

Related:

Do reviews really guide purchase decisions?

According to, 78 percent of consumers in the United States read reviews before making a purchase decision. YouGov’s report reinforces findings in a previous study that found that 87 percent of consumers trust online reviews as much as they trust friends and family. On the other end of the spectrum, four out of five consumers reverse their purchase decisions based on negative reviews.

People take positive reviews and high ratings as social proof a product or service is worth the purchase. They reason, “This has great reviews, so I’m buying it.”

How do reviews shape perception and future feedback?

According to , the average rating for a hotel with 11 to 20 reviews is 3.5 out of 5 stars, with “terrible” reviews (a rating of 1 star) at close to 12 percent. Interesting, as a hotel sees 101 reviews or more, its average star rating increases to 3.9. The feedback pattern, therefore, favors quantity. The more your business is reviewed, the likelier you are to receive higher ratings.

Apart from providing social proof for customers looking to make a purchase decision, reviews also provide social proof in other ways. These online testimonials shape how people perceive brands. And reviews also influence what people think they should say, when it’s time to add their own voice to the conversation.

A customer’s opinion about a Yelp-listed restaurant with 100 reviews and an average rating of 4.5 stars is less likely to go against the grain and offer a counterpoint to all the positive feedback. The consumer thinks, “This has great reviews, so I’m going to say the same about it.”

How should you manage and respond to reviews?

To stay competitive, you must be able to effectively manage your online reputation. Track and monitor your reviews. Know when and where your customers are talking about your brand. Respond to customer feedback, both positive and negative. Dive deeper into the comments to look for useful insights and information that will help you improve the customer experience.

Related:

Here are a few tips on responding to negative reviews:

If you or your staff made a mistake, apologize. Even if you didn’t make a mistake, apologize and thank the reviewer for taking time to tell you what he or she thinks. Social proof is most potent when you’re able to turn unhappy customers into loyal fans. If someone wrote a harshly unfair comment and gave your business a low rating, keep your head up, say sorry, and tell them you hope they’ll come back so you can offer a better experience.
Address all parts of the review. For example, if the reviewer writes the bank teller was rude or your bank’s app is buggy, acknowledge the issues and address them individually in your response.
Ask the customer to reach out to you directly. Explore whether there’s anything you can do to make up for the customer’s bad experience. There’s a caveat, though: Never offer bribes or incentives for customers to change their review’s sentiment.

Of course, harnessing the potential of reviews as social proof isn’t only about righting wrongs or recovering critics and detractors. It’s also about activating happy customers and promoters. Keeping that in mind, here are some equally important tips on maximizing the social proof inherent in positive reviews:

Say thank you. If a customer took the time to present social proof for other prospective customers to see, expressing your gratitude is the very least you can do.
Reinforce what customers love most about their experiences. In your response, explain that the delicious cupcakes actually are homemade. Let them in on how you grow your own arugula, or tell them others also have commented on the amazing views from your resort’s cliffside swimming pool.
Respond in a reasonable amount of time. is an ideal time frame to start.

Related:

Customers who are vocal online can influence others’ attitudes, beliefs and behaviors. While there’s no way to control what people say about your business online or offline, you do have the power to change the conversation. Managing customer feedback and leveraging the right kind of social proof ensures you account for the positive opinions shared by your happiest customers.

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Brand

Cadbury India

Growth of a Sub Segment

Psychographics And Demographics

The Chocolate Industry in India

Halal Cosmetic

Aims and objectives of Waitrose

Waitrose aims:

Waitrose Objectives:

Maximising profits:

Developing Organic range:

Motivating staff:

Develop links with local community

Increase levels of customer service:

Increase the number of branches in the North:

Employer branding

Footings of mentions

Introduction:

Employer stigmatization

Recruitment and employer stigmatization

Benefits of Employer Branding

‘Living the trade name ‘

Denial of individualism ( dress codification policy )

Issues with work topographic point frock codifications

Ailments of favoritism

Sexual activity favoritism and frock codifications

Religion/belief favoritism and frock codifications

Disability favoritism and frock codifications

Decision

Recommendations

Mentions:

La Shampoo

Building Up Brand Awareness in a Social Media Context

Online Reviews Are the New Social Proof

What is social proof?

Do reviews really guide purchase decisions?

How do reviews shape perception and future feedback?

How should you manage and respond to reviews?

Sometimes it is hard to do all the work on your own