The recent product, liquor filled chocolates is a viable business that can sell if it is implemented professionally. This recent innovation should be able to acquire attention from the market owing to its combination of selling products. Put simply, the liquor-filled chocolates are chocolates that contain alcohol. According to Novellino (2011), Chocolate-candy sales summed up to $16 billion in 2008 in the U.S. Furthermore, the statistics on alcohol reveals that liquor sales hit $19.9 billion in 2011. What does the statistics reveal about the product? This reveals that the market for the two products is present and combining them will result in a profitable business. This paper is a report on targeting and segmenting the new liquor filled chocolates as a potential business. To begin with, it is crucial to appreciate the meaning of segmentation and targeting because these two terms lay the foundation for this report. Consequently, segmentation is dividing a market, into groups of consumers with homogenous traits in order to provide each group with the desired product. What is the meaning of targeting? It is where an enterprise evaluates every segment with an objective of identifying segments with promising business opportunities. Considering the nature of the product in question, it sufficed to mention that liquor- filled chocolates are to be sold to adults. As aforementioned, the product in question requires that adults be considered as the only market. This owes to the reality that the law prohibits selling of alcohol and alcohol related products to minors. The market can be further divided according to gender because both men and women have different tastes (chocolate shapes, packaging, and type of liquor). It is known that women are already consuming chocolates. In fact, the numbers of women that consume chocolate far outnumber the numbers of men that consume chocolates. It follows that there is a ready market for the commodity in question. Nonetheless, the reality that introducing alcohol to make liquor filled chocolates increases the market. This is because it attracts the attention of men. Novellino (2011) argues that introducing some high-end liquor into chocolates will be an offer men cannot refuse. Thus, the target for the product is both men and women who are legally allowed to take alcohol-related products. However, shipping liquor would be tricky because of the current regulations involving alcohol content. Novellino (2011) reveals that Boreth who has successfully ventured into this business faced similar challenges.
While Europe and the United States account for most chocolate consumption, the confection is growing in popularity in Asia and market forecasts are optimistic about the prospects in China and India (Nieburg, 2013, para 9). According to the CNN Freedom Project, the chocolate industry rakes in $83 billion a year, surpassing the Gross Domestic Product of over a hundred nations (“Who consumes the most chocolate,” 2012, para 3). If chocolate continues grow popular in Asia, it stands to become even more lucrative.
The aim of this report is to examine Innocent Drinks position within the market and to see how their position of strength can be built upon, both in the current market and any potential new markets.
Market research and information about the industry is very important to the organization because it will allow the organization to position itself well in terms of sourcing chocolate raw materials and in identifying the market for its products. For example, understanding that some chocolate product purchases are seasonal, e.g., at Christmas; around Mother’s Day; and, on Valentine’s Day, allows the organization to have more product on hand and to create displays, in store, that will increase purchases and attract more customers when existing customers tell their friends about the availability of high end products, at reasonable prices, in their store.
Segmentation variables can be classified into four major classes; geographic, demographic, psychographic and behavioural. The use of these categories either individually or in combination assists companies to identify and establish market segments which is relevant to the product or service they are offering. This in turn helps these organisations to evaluate the relevant segments to choose the pertinent target market.
In terms of similarities, the food bar industry as a whole seems to be targeting demographic rather than their target segment. Marketers are focusing more of their dollars into packaging their products to appeal to women. This can be seen by the focus on flavors such as Chocolate Covered Strawberry (Cytodyne's Xenadrine Bar), Almond Bliss (Nature's Plus Especially Yours Bar), and Chai Tea (Clif Bar's Luna Bar).
Segmentation is the process of identifying different macro-groups of customers (i.e. segments) based on their common characteristics. The process of choosing a target segment, on which to focus marketing activities on, is a process named targeting.
Before Milton Hershey had a world wide known chocolate business, he had a small, not so well known caramel business. Milton Hershey began his chocolate making business in 1893, when his father and him traveled to Chicago to attend a big job fair (Tarshis 14), but it wasn’t until 1900 when Hershey succeed in making the first milk chocolate candy bar (The Hershey Company). Hershey attended an exhibit hall of new and amazing inventions around the world at the fair in Chicago. As Hershey walked into the exhibit hall, he was struck by a delectable smell (Tarshis 14). “Hershey was already a leading candy maker. He had created the largest caramel factory in the country, but he became convinced that the future of his business would be chocolate. At the fair in Chicago, Hershey Bought chocolate-making equipment. He had it shipped back to his caramel factory in Pennsylvania. Then he hired two chocolate makers. Soon the company was churning out chocolate candies in more than 100 shapes” (Tarshis 15).
Chocolate companies changed from minimal production to massive manufacturing. Thus, targeting different market segments that weren’t possible to reach due to the high cost of the good. The market was able to shift because of the industrialization process that includes several innovations, such as van Houten’s process, this allowed a broad production and distribution of chocolate that spread around the globe.
Marketing is not just about selling and advertising products and services. In general, marketing is associated with identifying the particular wants and needs of a target market of customers, and then working to satisfy those customers better than the competition. This involves doing market research on customers, analyzing their needs, and then making strategic decisions about product design, pricing, promotion and distribution or place (Bethel, 2007). Understanding ways to identify the target market is crucial in developing market strategy. This paper is intended to define target marketing and examine a market analysis of Stacy's Pita Chip Company.
Terrell, E. (n.d.). Market Segmentation. (Business Reference Services, Library of Congress). Retrieved April 6, 2014, from http://www.loc.gov/rr/business/marketing/
Chocolate bars are thought of as impulse buys, which means they require no thought. This is due to how inexpensive they are. However, if an ingredient such as sugar was to rise drastically, so will the cost of the chocolate bar therefore changing the buyer's perspective on the product class.
Abby Willow once said, “The average American adult consumes 11.7 pounds of chocolate every year- that's the weight of about 6 pairs of shoes!” With so much consumption of chocolate by Americans, it is crucial for the numerous brands to advertise their products in a manner that could potentially dominate their competition in sales. There are endless ways for a company to draw the attention of an audience in order to take over the competition of chocolate sales. Advertising is a key aspect as to how successful a brand may be when compared side-by-side to a similar product. While Snickers and Reese’s Peanut Butter Cups are similar, they are also different; the differences are significant because they demonstrate how some competitors choose to go above and beyond for their advertising while others opt to take a route that is of a more simplistic nature.
Caroline and Jennifer said that ‘Market segmentation is a crucial marketing strategy. Its aim is to identify and delineate market segments or set of buyers which would then become targets for the company’s marketing plans.’ (Tynan and Drayton, 1987) There are many ways to segment the market, such as age, region, environment, psychology and wages (Hall, Jones and Raffo, 2010).
Market segmentation means dividing the market into distinct groups that have common needs and will respond similarly to marketing action. Each segment must be unique, have common needs, and respond in a similar manner to marketing efforts. Target market is the group of potential customer that has been selected by business to focus its marketing efforts towards. This is the group the business wants to sell its products/services to. Positioning refers to the image created in the minds of customer of its product or brand. It is a perception created in the minds of the consumer relative to that of its competitors.
Alan’s Best Chocolates (ABC) is a leading company in the sales of confections and chocolates throughout the United States. The company’s products are sold from 50 stores across the country and maintain a high reputation for superior quality and taste. While the company’s sales have grown over the past ten years, the rate of growth has significantly slowed. One key factor for this slowing rate of growth is the shift in the marketplace to purchasing chocolates and confections online. For a company to succeed, it needs to plan on how to capitalize on this online marketplace by leveraging existing technologies, industry best practices, and aggressive marketing and sales campaign to ramp up the its growth projections for the foreseeable