Haagen-Dazs has been successful for over half of the century. What are the sources for these successes is always challenging marketers of Haagen-Dazs itself and the competitors as well. Preparing good marketing strategies is always the policy craved deeply into marketers teams. Having an overview of the current market situation of ice cream industry and Haagen-Dazs profile will provide some new insights for the future development of the company.
Along with that, market segmentation, target, and positioning determined by Haagen-Dazs are worth dwelling deeply into. Before getting any further steps, considering carefully the external and internal factors that influence the operating of Haagen-Dazs is necessary in coming up with impressive tactics. Succeed or failure in creating values for customers in order to capture back values in return depends mostly on the marketing mix that Haagen-Dazs employing into its strategies. Product, price, place, and promotion strategies are all helping Haagen-Dazs differentiating with other competitors.
Maintaining the uniqueness of its business is directly relating to the survival of Haagen-Dazs in a competitively strained market. Thus, looking into its weaknesses and threats to find out new ways of doing things is critical than ever. Haagen-Dazs needs to target more segments, changing its marketing programs to fit with the new segments will never be redundant. It should also think of gaining control over those loopholes threatening its reputation and ethically consolidating its commitment to customers as a back wall for new launching.
II. CURRENT MARKET SITUATION 1. INDUSTRY Global sales of ice cream reached 13 billion liters in 2002, an increase of 3% over the previous year. This was a significant improvement over 2001, when sales expanded by 1. 8%. This trend continues extending to the future. Growth has been driven by rising levels of disposable income, which allowed consumers to purchase non-essential foods on a more frequent basis. Demand for ice cream is also becoming less seasonal, with the product increasingly serving as a snack throughout the year.
Continued product innovation was also critical in boosting demand, underpinned by increased levels of advertising expenditure from the major international players. As the result, more and more companies try to get into the ice cream competitions around the world. Recently, Unilever announced its ever ambitious investment in ice cream category. Unilever today unveiled plans to shake up the ice cream market and strengthen its global leadership by boosting its US$ 6. 6 billion global ice cream business.
One of the biggest changes in ice cream industry that challenges most of the companies is the change in consumer buying behavior. Bulk ice cream used to dominate the market with 70% share, while the rest are frozen novelties. Today, the share has been reversed to 30% and 70%, in favor of frozen novelties. However, this trend seems to be favorable by some ice cream franchising companies that inherently dominate in offering frozen novelties such as Baskin Robbins-31 Flavors. Despite these changes, ice cream has still been considered as a lucrative industry. Sales and revenues grow increasingly years over years.
The competition in winning the market share becomes one of the most important strategies for both existing companies and new comers. 2. COMPETITOR AND MARKET SHARE There is no doubt that Haagen-Dazs’ biggest competitor is Ben & Jerry’s. These two companies are very similar but yet also very different. Both of them had control the global super-premium ice cream market. They had about 42% of the market, with the remaining 15% being divided up between a numbers of smaller firms that compete on either a local or national basis. How Haagen-Dazs compete with their competitor?
In general, Haagen-Dazs are trying to create and add more values to their products offered to consumers. They clearly state that their brand stand for premium ice cream which is thicker, creamier and pricier than their competitor. At the meantime, they introduce their new product with a major advertising effort. On the other hand, Baskin Robbins is also a challenge to Haagen-Dazs. In reality, Baskin Robbins does not compete directly with Haagen-Dazs because Baskin Robbins mainly targets at different market as well as manufactures premium ice cream, not super premium ice cream.
However, with strong marketing strategies, Baskin Robbins may distract the affluent young adult market Haagen-Dazs pursuing. Many adults, especially adults with children, are increasingly attracted by what Baskin Robbins is following. Based on 2002 statistic, Baskin Robbins alone took over 45% of U. S market for premium ice cream. Similar to Baskin Robbins, Dreyers is claiming up in the market share for premium ice cream, and threatening Haagen-Dazs by distorting the affluent adult market.
Dreyers strongly believes that Ice Cream with half the fat and a third fewer calories than full-fat premium it offering would take the ice cream world by storm. III. COMPANY PROFILE In 1920s, Reuben Mattus, a young entrepreneur with a passion for quality and a vision for creating the finest ice cream, worked in his mother’s ice cream business selling fruit ice and ice cream pops from a horse drawn wagon in the bustling streets of the Bronx, New York. To produce the finest ice cream available, he insisted on using only the finest, purest ingredients.
The family business grew and prospered throughout the 1930’s, 40’s and 50’s, and by 1961 Mr. Mattus decided to form a new company dedicated to his ice cream vision. He called his new brand Haagen-Dazs, to convey an aura of the old-world traditions and craftsmanship to which he remained dedicated. The Haagen-Dazs brand spread rapidly during this period. By 1973, Haagen-Dazs products were enjoyed by discerning customers throughout the United States. Then in 1976, Mr. Mattus’ daughter Doris opened the first Haagen-Dazs shop.
It was an immediate success, and its popularity led to a rapid expansion of Haagen-Dazs shops across the country. In 1983 Mr. Mattus agreed to sell Haagen-Dazs to The Pillsbury Company, which remained committed to the tradition of superior quality and innovation on which Haagen-Dazs was founded. Since then, it has become a global phenomenon, available in 54 countries. Ice Cream lovers the world over now recognize the unique Haagen-Dazs logo as synonymous with the ultimate super-premium ice cream. In 1989, Pillsbury became a member brand under the control of General Mills Co, Ltd.
The missions and visions of Haagen-Dazs have still remained with it until now. Haagen-Dazs was also recorded as the first to introduce the world to ice cream bars for a grown up palate, with the introduction of the Haagen-Dazs ice cream bar line in 1986. Other super premium innovations followed, with Frozen Yogurt in 1991, Sorbet in 1993, and the Italian inspired Haagen-Dazs Gelato line in 2000. In 2005, Haagen-Dazs franchised its license to Nestle group to sell Haagen-Dazs ice cream in North America. However, the market outside of North America still maintain with Pillsbury. 1. MISSION
The philosophy of Haagen-Dazs is “to find the purest and finest ingredients and craft them into the best ice cream, sorbet, and frozen yogurt. Haagen-Dazs mission is to provide every customer with high quality dessert eating experience. ” 2. SEGMENTATION Haagen-Dazs based on three main segmentations to target their market. These segments consist of demographic, socio-cultural and psychographic. First, we look at demographic segmentation. Haagen-Dazs splits the market into groups based on income. They focus on consumers who have higher income to spend on luxuries such as their super-premium ice cream.
They also separate the market based on age and aimed on the adults. Even though they do not segregate flavors by gender, they do tend to give marks for romantic and sensuous image of ice cream. Besides, they highlight the indulgence and pleasure related to sex. The second one is the socio-cultural segmentation. Different cultures and nationalities have different needs, especially in foods. European people have preferences in alcohol drinking; Japanese people are famous for their tea arts. On the other hand, Islamic countries are negatively sensitive with luscious images while Westerners express their enthusiastic for romantic.
Observing carefully the socio-cultural can really give Haagen-Dazs a good tool in catching their target markets. The third one would be the psychographic segmentation. In psychographic segmentation, Haagen-Dazs divide buyers into group based on lifestyle and have their eyes on those buyers who take pleasure in the lavishness and indulgence linked with the brand. Haagen-Dazs had established an ambience behind its cafes which uses furniture that is comfortable and in deep shades of browns, burgundy and red to add a feeling of insulate and familiarity. 3. TARGET
Decide not to completely follow these segmentations; Haagen-Dazs has narrowed down its business to carter to two main target markets. The first segment is affluent, pleasure seeking adults who are generally brand conscious, innovators and trend followers. Second is the market of health conscious, young adults who are interested in desserts but prefer natural ingredients and low fat substitutes. By identifying only two target segments and focusing on a small but profitable segment of the market, Haagen-Dazs is practicing a niche market strategy. 4. POSITIONING
Haagen-Dazs positioning is mostly based on its product and service differentiations. They uphold their high quality and luxurious ice cream by using special selected ingredient. They also ensured that fresh cream is used for a rich creamy flavor and there is no excess air. While most of other companies test their product quality only within their manufacturing processes, Haagen-Dazs seriously bring it a step further to ensure that quality tests take place at every stage of production by visiting and testing ingredients suppliers, checking manufacturing processes and equipment daily, tasting ice cream in-store.
There is clearly strong evidence to its product quality and that value will be perceived later as a testified commitment in the market. In addition, Haagen-Dazs associates its brand with luxurious tastes by using best ingredients from around the world and ensuring fresh cream is used for a rich creamy flavor, fresh skimmed milk for body and texture and fresh egg yolk for delicate flavors. As a matter of high quality product differentiation, they advertise that their ice cream is ALL ICE CREAM. Haagen-Dazs positioning is also based on image differentiation.
This company use deep maroon ; gold logo to provide strong brand recognition and image differentiation. This logo is communicated through advertising that conveys their brand’s personality which is various exotic flavors. Combining with the ambience of each Haagen-Dazs cafe shops, it is brought to the most exclusive status ice cream company in world. VI. SWOT ANALYSIS Marketing strategy plays an important role in the survival of a company. Coming up with a smart marketing strategy seems to be a vital point that push up the competitive advantage of the company in that market.
However, the microenvironment and macroenvironment factors are always putting their influences into the decision making process of marketers. Not to be an exception, Haagen-Dazs’ marketing processes are often impacted by these factors. Before dwell into the marketing mix of Haagen-Dazs, we are going to evaluate those factors that most probably affect this company’s marketing strategy by SWOT analysis. 1. STRENGTHS Developed brand with an attached history of perfection and luxury The idea of Haagen-Dazs dates back to the early 1920’s and was founded by Reuben Mattus.
It was a family business before it was sold to the Pillsbury Company in 1983. Haagen-Dazs is one of the largest international brands and it started off with only three flavors: vanilla, chocolate and coffee, and up to date its product list with more than 63 new flavors nowadays. Holding a strong brand name, Haagen-Dazs has been building a special image in the consumers’ mind. Every time, talking about Haagen-Dazs, consumers easily relate to the super premium, artful and lustful ice creams that most probably only Haagen-Dazs is taking dominance over other competitors.
In fact, Haagen-Dazs’ brand equity has been expanding over and over many different markets around the world. With a high product level and product quality, Haagen-Dazs is confident in stating their philosophy “Make it like no other. ” Strong market position Building up a strong brand also leads to a strong market position. The company markets its products in more than 100 countries outside the US. Taking up to 42 percent of global ice cream market, Haagen-Dazs becomes one of two main players in super premium ice cream market. Under the General Mills’ control, Haagen-Dazs continues to build and expand its fast-growing nternational businesses across the world to become a megabrand. Obviously, strong brand name and leading market position will help in generating more revenue in the near future. Intelligent market targeting While other ice cream manufacturers focused on children, Haagen-Dazs was the first companies focusing on “adult ice cream lovers. ” Recognizing not only children loving ice cream, but adults also love ice cream as much as any others. Quickly taking advantage, Haagen-Dazs became the first-mover into a very potential segmentation that was forgotten by other competitors.
This wise strategy has been contributing to the strengths of Haagen-Dazs for long. Use the finest ingredients to deliver product excellence Another strong aspect of Haagen-Dazs is the commitment to the quality of its products. Mr. Mattus insisted on using only the finest, purest ingredients to produce the best ice-cream; and his passion for quality soon took him to the four corners of the globe. His unique ice cream recipes included dark chocolate from Belgium and hand-picked vanilla beans from Madagascar, creating distinctive and indulgent taste experiences.
The old tradition and craftsmanship of superior quality and innovation remained committed even after Haagen-Dazs was sold to Pillsbury Company. By continuously searching for new flavors and improving the quality of its products, Haagen-Dazs really differentiate itself with the products of other companies. Especially, the mixing between ice cream and alcohol becomes the most famous and special ice cream that only Haagen-Dazs can innovate. The secret formulas for this mixing can be considered as one of the competitive advantages of Haagen-Dazs to other companies. Vastly invested in consumer research
Understanding tastes and preferences of customers is one of the key element for development its products. Before production actually begins, Haagen-Dazs unhesitating pours large amount of money for researches based on consumer-driven philosophy to understand the consumer preferences, desires and needs. As the result, more than 65 artful and unique flavors have been introduced to the market. The most recent introducing of Haagen-Dazs consists of the six Reserve Series which are believed costing millions dollars to look for uniquely new ingredients such as Lehua Honey, Lehua Blossom imparts, Amazon Chocolate, or Brazilian Acai Berry Sorbet.
Used creativity and innovativeness to support brand identity Up to now, Haagen-Dazs offers a rotating range of products from ice cream to sorbet, frozen yogurt and frozen snacks in more than 65 flavors. Haagen-Dazs also markets flavors using pieces of cookies and candies. Besides that, Haagen-Dazs have introduced limited promotion for the “Reserve Series” as an exclusive line available in limited quantities in order to get attraction of ice cream lovers on these flavors as well as to prove the product level and quality attached to its brand. Strong advertising campaigns
Haagen-Dazs brand was first advertised on national television in 1981. Most print ads for Haagen-Dazs in the 1980s showed images of delicious-looking ice creams. In 1989 after General Mills (GMP) took over Haagen-Dazs Company Inc. , Haagen-Dazs brand came to symbolize desire, pleasure, and indulgence. GMP engaged the services of Bartle Bogle Hegarty to launch an ad campaign. All through the early 1990s, Haagen-Dazs ads used the same theme and structure, with only minor variations in presentation depending on the country. The print ads were placed in publications like People, Vanity Fair, Esquire, EGG, Interview, etc.
The campaign also included ads on radio and outdoor media, and in-store promotions. Consumers could easily identify Haagen-Dazs through its unique design and its advertisement. 2. WEAKNESSES In spite of its strengths, Haagen-Dazs still confront with some drawbacks that are deterrent to the ambition of reaching the first position of super premium ice cream producer in the world. These weaknesses are going to be discussed respectively as follow. Regarded as high Costly The first weakness is the high prices of Haagen-Dazs’ product. Although he world is moving to a general economic trend of higher earnings, more disposable income and leisure time, they need to understand that it’s not just the affluent or upper class people eating their ice-creams but also those of the lower and upper middle-income segments desiring for tasting the uniqueness of its ice creams. Setting the price too high seems to ignore this huge segmentation. And it also means that Haagen-Dazs accepts to be kicked out and only to become a watcher looking competitors sharing the “big pie”. Focus on a narrow range of market segment
As mentioned above, Haagen-Dazs is only focusing on affluent adult segment. This market target might be attractive at first, but it’s gradually losing the competitiveness. In fact, when there are more and more companies jumping into the adult segment, Haagen-Dazs will not be the sole player in this segment any more. At that time, Haagen-Dazs must share its market with many prospective competitors who may possess better marketing strategies, or innovations. Sexual image used in advertisement and no updated advertisement campaign Haagen-Dazs ice cream main theme is more for the adult.
The same ads content repeatedly used and sooner customers will fail to take notice of it; consequently, it may lose the appeal of its position in the consumer perception. The biggest problem here is some Haagen-Dazs advertisements are unsuitable in some cultures or civilizations. Especially, it may have adverse effects when using these advertisements in Islamic countries such as Afghanistan, Iraq, Iran, etc. Costly Distribution The fact that Haagen-Dazs ice creams need to be kept at a temperature substantially lower than most of other ice creams in order to keep its intended firmness is making it more expensive for storage and distribution.
Moreover, to keep its commitment to provide the products with finest ingredients, Haagen-Dazs has to exploit materials in many far-distant places and transport back to its plants in different areas. The result is that it takes a great deal of money for Haagen-Dazs to move ingredients and materials around. Off course, the cost production and the prices of final products must be unexpectedly high. 3. OPPORTUNITIES Market for ice cream products getting larger Ice Cream lovers in the world over recognize the unique Haagen-Dazs logo as synonymous with the ultimate super-premium ice cream.
In the early of its stages, Haagen-Dazs was only available at gourmet shops in New York City, but soon distribution expanded throughout the east coast of the United States since people who tasted the distinctive ice-cream transmit the good taste all around through their mouth. Soon, the opening of their first shop led to a rapid expansion of Haagen-Dazs shops across the country. However, since The Pillsbury Company bought Haagen-Dazs; it has become a global phenomenon that available in more than 60 countries and even owning over 1,000 outlets around the world.
The success of Haagen-Dazs was created by their persistence in remain the quality and using only the finest natural ingredients. As an example of the acceptance of abroad on U. S. ’s product, Japan represents the second largest ice cream market in the world, with annual sales of about $4. 5 Billion. By the way, Haagen-Dazs capturing 50% of the market in Japan following by others six Japanese super premium ice cream products. However, that is only the beginning of the game. Many other highly potential markets are still untapped waiting for Haagen-Dazs’ actions.
Chinese market is the next target Haagen-Dazs should focus on expending its brand name. Malaysia still has many place for Haagen-Dazs while Vietnam, Indonesia, Thailand are untapped by ice cream industry. Targets low fat demand These days, people are more emphasize on their own health. As the increasing of health consciousness, people tend to live in a healthy lifestyle by eating well and exercise regularly. On the same time, diet seems to be a trend in the society, not specific for only woman but the male nowadays do take care of their body figure.
Therefore, you can find out the products all around the market are all about Light, Low Calorie, Low Fat, No Fat, Fat Free, No Sugar, Sugar free, and Zero Calorie. For Haagen-Dazs, they came out with almost fourteen flavors of light ice-cream with only half the fat. Besides that, they also have the special taste of frozen yogurt with all the goodness of yogurt, naturally a good source of calcium with live and active culture. More than that, Haagen-Dazs produce all their ice-cream with natural ingredients that their ice-cream always make consumers feel comfortable in color and tasted cool and refreshing.
Yet it seems not enough for Haagen-Dazs to win their competitors in this running. There are still many spaces for Haagen-Dazs to expand their emperor in these low fat or healthy frozen desserts. The behavior of eating outside is increasing Nowadays people are more likely to increase life standard influence by their higher education and environment. Due to the income’s increasing, people tend to spend more to achieve a better standard of living. Besides, they are more able or willing to spend the amount for satisfying their own needs and wants.
Moreover, as we can see these days many people rather spend their leisure times and weekends at shopping mall than stay at home. As a habit, people would stop by to purchase some dessert as a finger licking. Then, the rising number of young people who demand in fast food and ice cream do effect the situation. Moreover, shopping wasn’t still a purpose of buying things but to away from the busy life and enjoy a plentiful meal or to taste a simple kind of happiness by melting a scoop of refreshing ice-cream in mouth. Preparing well for this trend, Haagen-Dazs are holding the key to open the door of a bigger room. Rising demands for cereals
Cereal stands for breakfast food which made of wheat, maize, rye, etc. In the market, we can find that many of the brand has started to add in the cereals into their product because the rise of health consciousness. Due to the demand for cereals, company could have take the chance and to come out with several Multicultural environment People are always mentioning about “global village” or whole nation this days. The term means that due to the speed of electric communication all the human society started to implode, and we have gone back to the village way of life. We all start to know each other and communicate in an nstantaneous way. Then, people from different countries, cultures, races, religion and so on will be gather and started to treat each other as their own nation. As the people more familiar with the others cultures, they would slowly influence by each other and as a result they would accept each other to create a peaceful lifestyle and take everyone as their own family members. Therefore, acceptance of cultural can help them to accept each other lifestyle and mainly food as well. Wisely, looking at multicultural environment as opportunities will be a strategic way to cope up with the globalization.
Nestle and Haagen-Dazs in US joint venture Two of the world’s biggest names in the ice cream sector, Nestle of Switzerland and Haagen-Dazs, a unit of the US-based Pillsbury Company have joined forces in the massive US market. The companies said that Nestle USA’s novelty ice cream operations and Haagen-Dazs’ frozen dessert business would form the back bone of a new 50/50 joint venture with combined sales of around US$600m. Both partners otter complementary products, Haagen-Dazs’ strong position in the super premium category combine well with Nestle’s novelty products.
Together, they will be better able to grow their respective businesses in the world’s biggest ice cream market, commented Peter Brabeck, chief executive of Nestle. The Swiss group will bring its expertise in frozen dessert technology to the venture, while sales will be boosted by Haagen-Dazs’ direct store delivery. The venture will lead to cost reductions though operational and distribution efficiencies. The deal is still subject to approval by the Federal Trade Commission, and will include Nestle’s production facilities in California and Maryland and Haagen-Dazs’ site in California.
The latter’s chain of shops in the US and its international ice cream operations are no included in the venture. 4. THREATS Customers may displace US products with products from Asian countries How does consumer used to think about U. S. products? Of course, high quality, durable, good condition as well. However, for most of them such as Asian, they treated U. S. product as a shopping goods or luxury goods because of its selling price. If we compare the price of several U. S. imported product to some Asia made product, obviously there is a big different etween both of the price. In Asian countries which own a big population, they could easily hire labors even though the company only pays such cheap wages. Therefore, it’s easy for them to reduce the producing cost but also to producing more. More than that, the high taxes that been charged on U. S. products during the export process do cause why people can’t afford to purchase them. Diseases such as mad cow may threat the market of the ice cream industry. To make ice-cream, we will need few key ingredients such as milk, cream, egg yolk, and sugar.
Therefore, mad cow disease will directly bring the ice-cream industry such difficulty because without any of the ingredient, especially milk, the ice-cream wouldn’t be produced. According to the research, the human equivalent of Mad Cow Disease causes memory loss, emotional instability including inappropriate outbursts, an unsteady gait, progressing to marked weakness, severe rapidly progressive dementia and death, often within a year of the onset of symptoms. As people noticed that how serious will the disease affect them, they will start avoiding the product made by milk or any product which related to cow as well.
Political problem and regulations Political problem do cause problem to their country production. If both of the country couldn’t deal with each other or they maybe start a war, it may affect the economical and trade relations break as well. For example, USA actions in Middle East and Iraq may affect the relationship between Arab countries and USA. Besides, violent politically related acts in Middle East and gulf region could gave bad image about this region and may affect trading between countries.
Besides, the regulations set out by different governments or organizations make it difficult to be conformity in managing and producing processes. Specially, following the regulations related to sanitary and healthy product practices from authority organizations such as Foods and Drugs Administration of U. S (FDA) may divert company from innovating activities. Growing Ice Cream Outlet Threats It is believed that one can find out there are different kinds of premium ice-cream brand when he or she walks on a street or inside a hopping centre, for example, Tipperary Organic, Maud’s, Mars & Nestle Tubs. This has shown the market now has over saturation of Premium ice creams; and the next aiming of premium ice cream producers may be super premium ice cream. More than that, Haagen-Dazs was threatened by other brands from different way. For example, Ben & Jerry has taken the lead of coming out with a creative idea that they set up Cinema Stand, there’s a brand new Australian Homemade Ice Cream cafe in Liffey Street, Maud’s Ice Cream Mall Stands and more.
Furthermore, the economic have faced a small depression these days, therefore the demand for convenience products are actually increasing by day to day while shopping and luxury products may be affected in some ways. Moreover, there’s also growing demand for private labels. Losing control through mass franchising Haagen-Dazs has been franchised its products to hundreds countries around the world. Following a centralized structure in the organization seems to be inappropriate for its size. Controlling the whole organization through one headquarter located in the U.
S makes it always overloaded. The problem of quality consistence in its product cannot be testified perfectly at those outlets far from the reach of headquarter. Specifically, recent warnings of sanitary problem of Haagen-Dazs ice creams in China questioned the controlling and testing processes being applied at these franchises. If Haagen-Dazs doesn’t take any action to fix this problem, the image of the company may be destroyed aggressively. V. MARKETING MIX Marketing mix plays an important role in the overall marketing strategy of a company.
Nobody can deny that a good marketing mix means a strong competitiveness of a company. In this situation, Haagen-Dazs can be considered as one of plenty successful companies employing a very tactical marketing strategy. Due to the characteristics of ice cream industry, Haagen-Dazs product is determined as a combination of physical products and services. Thus, the marketing tools being used include seven Ps that are going to be analyzed in more details below. 1. PRODUCT Haagen-Dazs offers to customers a wide range of products.
Basically, there are seven different classifications for their products. It includes ice cream, reserve, light ice cream, sorbet, frozen yogurt, bar, and novelties (shop specialty). Under each classification, there are many other different sub-products with various flavors. Even though it is abundant in product types, the core products that Haagen-Dazs offering to its customers are frozen desserts. In other words, what the customers are really buying is ice cream or yogurt inside of Haagen-Dazs containers.
Based on marketing concept, actual products that Haagen-Dazs offers in the markets must include many other added values such as packaging labeling, marketing, distribution, advertising efforts and many others of the company. However, the final products that Haagen-Dazs selling to each customer must be known as the augmented products which are added some kind of values consisting of delivery services, customer communication, and other kind of services at Haagen-Dazs outlets that create the feeling of indulgence and lasting pleasure.
Hence, the value created and the products strategy that being applied by Haagen-Dazs must be come along the process of developing their product from the start-up of the products until reaching the consumers’ hand. The variety in the product line shows that Haagen-Dazs is following many different segments in its target market. Off course, these segments must be convergent to the general target market, affluent adults markets. The only difference in the adult segment is the differences in taste and preferences. Therefore, by pursuing various product lines helps Haagen-Dazs reach its positioning strategy.
Comparing Haagen-Dazs and other ice cream manufacturers, Haagen-Dazs is obviously dominant in the product level. Its products are not the same with any normal ice cream, not premium ice cream also, but it is Super Premium ice cream. By promising the finest ingredients and the unique flavors in the products, Haagen-Dazs differentiates itself with other competitors. In reality, Ben & Jerry is the main rival of Haagen-Dazs in offering Super Premium Ice Cream; however, Haagen-Dazs make them more popular than the rival by the famous mixing of ice cream and high quality liqueur.
They also make them different from other smaller competitors such as Baskin Robbins by rich creamy flavor, fresh skimmed milk for body texture and fresh egg yolk for delicate flavor. All of the differences in quality of their products as well as the ability of innovation come from bold and strong investment of Haagen-Dazs’ headquarter into the research and development activities. They successively search for new flavors and recipes from special the ingredients and material coming from many different places around the world.
In the beginning of 2007, Haagen-Dazs has just introduced new Reserve Series which are resulted in the hard working of researchers. They have searched for long before coming up with the Hawaiian Lehua Honey and Sweet Cream Ice Cream whose honey is brought back from Hawaii, the tart Mediterranean Pomegranates in Pomegranate Chip Ice Cream, Amazon Valley Cocoa beans in Amazon Valley Chocolate Ice Cream, or rare and complex Acai berry in Brazilian Acai Berry Sorbet, etc. Paying attention to the development of new products is one of the most competitive product strategies that Haagen-Dazs is using.
A hot new product certainly helps, and so might it get point for advertising. However, perhaps one of the greatest potential sales boosters is packaging. Indeed, not all consumer buying decisions happen that quickly. But having distinctive, eye-catching container is a definite advantage in today’s crowded ice cream or freezer cases from a messy pool of frozen dessert and ice cream manufacturers. Excellent packaging not only gets attention and helps sell, it also projects a positive company image, and that means a lot to consumers and retailers.
For this reason, Haagen-Dazs unveiled the results of its first comprehensive packaging update in the company’s 30-year history. The new graphics on all Haagen-Dazs pints, quarts and novelties are designed to strengthen brand identity and unify of the entire product line. The company also improved flavor identification on the packages. Extensive consumer research was used to find out which package elements should be kept and which ones should be changed. Based on the research, Haagen-Dazs decided to eliminate the silver plate depicted on its ice cream novelty cartons.
The plate was thought to imply a usage situation that was too formal and too specialized. The fact that Haagen-Dazs products appeal to a wider spectrum of consumers now than they did several years ago is another reason why the elitist silver plate image had to go. Broadening a product’s consumer base, in fact, is one of the key motivations behind most package redesign projects of Haagen-Dazs. Besides, labeling is also the concern of most consumers in the healthy days. More and more people complain about high fat or cholesterol in the content of the prepared food selling on the markets.
This issue is pulling the concern of healthy protection agents such as Foods and Drugs Administration from the United States. There are more and more regulations and producing healthy foods as well as the obligations for labeling the products. Knowing its important, Haagen-Dazs is switching new line of products with lower fat or even free from fat. All of the Haagen-Dazs sorbet products are fat free. Banana Strawberry and Raspberry ; Vanilla Frozen Yogurt bars are also fat free. All other smoothies and frozen yogurts are 97% fat free.
Not only focusing on the problem of fat, but Haagen-Dazs also emphasizes the sensitivity of customers on some kind of minerals. To make sure that its products do not cause any harm for consumers, Haagen-Dazs labels its product very carefully. Recently, they indicated that if there is “flour” listed in the ingredients on the product label, it contains gluten which can create some sensitive reactions in customers. Examples of Haagen-Dazs products that do not contain gluten include Vanilla, Coffee, Strawberry, Extraas Rocky Road 500 ml and Banana Strawberry Frozen Yogurt Bar. Brand name must be included in product strategy of Haagen-Dazs.
The brand equity that Haagen-Dazs has been building up is expanding all over the world. Talking of Haagen-Dazs people immediately relate to Super Premium Ice Cream, alcohol ice cream. More than that, Haagen-Dazs brand name also attaches with “sexual fantasy” and “share indulgence. ” The fictitious commercial brand name, Haagen-Dazs, which is made up to sound somewhat Scandinavian – or Danish, always creates a strong charming feeling in consumers’ mind. Vividly, Haagen-Dazs’ brand equity always includes its high product quality and levels, lusciousness, charms, exclusive and even status.
Accompany with other strategies, product strategies Haagen-Dazs applying seems to receive many rewards for that. In fact, Haagen-Dazs pursued additional approaches to fuel word-of-mouth communications: branded freezers in food retail stores; sponsorship of cultural events; and a relatively low-budget, steamy print-media campaign with the theme The Ultimate Experience in Personal Pleasure. Linking the brand to arts sponsorship was a particularly savvy move. At one event, the Opera Factory’s production of Don Giovanni in London, the ice cream was even incorporated into the show.
When the Joachimsthaler and Aaker Don called for sorbet, he received a container of Haagen-Dazs. The result was out of expectation. A windfall of publicity began to spread among target consumers. The company’s coordinated brand-building efforts were overwhelmingly successful. Haagen-Dazs brand awareness in the United Kingdom, for example, reached more than 50% within a few months. 2. PRICE Pricing usually follows after the product strategy. The price of the products must be considered very careful before they are given to the final products selling to the market. Understand how Haagen-Dazs’ pricing strategy working is not an easy task at all.
It includes many different complicated aspects from product costs, and other internal and external considerations as well as customer perceptions of value. Haagen-Dazs’ decision to introduce a more expensive line of ice cream set up the “premium” ice cream position for the brand and made Haagen-Dazs one of the enduring marketing successes of the past several decades. What Haagen-Dazs did at the high end brands like Walls, Magnum did at another end. Haagen-Dazs was launched at a price 20% to 40% higher than its closest competitors and many times higher than the lower-priced products.
At this moment, most of Haagen-Dazs take-home ice creams in the Ice Cream line are selling at the price of US$ 6. 99 for one pint comparing to US$ 6. 79 for one pint of Ben ; Jerry; it’s 20 cents higher than Ben ; Jerry’s take-home ice cream. How did it succeed? High cost of production due to the commitment of finest ingredients is a fact. Spending a lot of money and effort for searching new ingredients and new recipes around the world pushes up the cost for production processes. Haagen-Dazs’ marketers look at these actions as creating more value for their customers.
Yet it is not the only reason for Haagen-Dazs setting its price higher than competitors. Although it’s also dominant in Super Premium ice cream manufacturing, Ben ; Jerry set their products a little bit lower than that of Haagen-Dazs. In marketing view point, we may explain this phenomenon as the pressure from competitors. In other words, Ben ; Jerry is suffering from the pressure of pricing competition directly with Haagen-Dazs. However, looking at Haagen-Dazs pricing strategy, they still decide to set their price higher than that of Ben ; Jerry. This phenomenon can be perceived as no pressure from pricing competition on Haagen-Dazs.
Specifically, Haagen-Dazs believes the values they are creating for customers are far more from its competitors. No pressure from competitors, Haagen-Dazs set the price of the products fit to the value it creating for customers. Similarly, when Haagen-Dazs introduced the latest flavors “Reserve Series” at the early of this year 2007, they pressed the price at US$ 7. 79. The 70 cents higher maybe come from the value they added to the new ones. These values include the new and unique ingredients which are scarce and expensive for exploiting, the special advertising programs, etc.
In general the value added pricing strategy allows Haagen-Dazs apply higher price for its products. Another advantage of Haagen-Dazs in setting the price is that the target market it is focusing is affluent adult. Adults are basically independent in their income; they have the right to spend for whatever they want. It seems not to be enough; Haagen-Dazs looks farther than normal income adults to affluent adults. The disposable income amount of this class is greater than that of normal adult. As the consequence, it set the high price without concerning anything for other segments in the market.
This segmented pricing strategy proved to be working out at last. It’s clear of what the brand stands for. The Haagen-Dazs brand means premium ice cream: thicker, creamier, and pricier than any other ice cream on the market; a uniquely sensual, self-indulgent, pleasurable treats targeted at sophisticated, affluent adult consumers. With strong brand equity, Haagen-Dazs is expanding the value through customer perceptions. The higher the value customers put on Haagen-Dazs brand name, the greater the price of the products Haagen-Dazs can charge its customers.
In addition, the commitment also makes customers believe that it’s Haagen-Dazs responsibility to maintain a high production levels and consistent quality in order to keep its promise. Therefore, customer perception of Haagen-Dazs value is even higher than ever for this commitment. The coming result is the willingness of customers in paying such a high price for what they believe worthy. Taking advantage of customer perception for setting its price, Haagen-Dazs seems to apply psychological pricing strategy and value-based pricing here.
Once again, this strategy is use effectively when setting at a very smart fractional price. Observe the prices of products offering at Haagen-Dazs outlets, we realize that they are ended with some nine numbers. As mention above, most of the Ice creams are selling at US$ 6. 99 for one pint, US$ 3. 99 for 4. 23 oz, US$ 7. 49 for 3 bars, and the latest Reserve Series are selling at US$ 7. 79. Do these 9 numbers really make sense for the producers? Off course, they are just psychological pricing strategy that makes the buyers believe there are some discounts or promotion for the products.
Or at least, it makes consumers feel cheaper when its price is still in the range of six, not seven. It’s more persuasive and attractive to set out such prices. 3. PLACE Product strategy and pricing strategy are showing their essence in the strategic competition with other companies, while marketing distribution channels give ways for the company to bring their created values to customers. Similarly, Haagen-Dazs is looking at distribution channel as important as any other marketing strategies. Haagen-Dazs indirect distribution channels indicate a successful strategy that company marketers have been applying for many years.
Haagen-Dazs builds its physical distribution channels in the conventional distribution channel. According to Kotler and Armstrong (2007), conventional distribution channel is a channel consisting of one or more independent producers, wholesalers, and retailers, each separate business seeking to maximize its own profits even at the expense of profits for the system as a whole. The common model for conventional distribution channel usually begins from producer; the products will be passed through wholesalers, then retailers, and final point to consumers.
Due to the characteristics of ice cream, the distribution systems of Haagen-Dazs requires its wholesalers, retailers as well as any other kinds of resellers a very special refrigerators or special storage room to keep the ice cream always under -12oC, especially super premium ice creams. Distributing to normal warehouses or retailers who have had enough ability to store ice creams is very dangerous to guarantee the products’ quality. Therefore, Haagen-Dazs only has its partnership with those wholesalers who have expertise and well-established warehouses in distributing frozen desserts.
Taking Japanese market as an example, Haagen-Dazs transports its products from the plant directly to the wholesalers such as Yikijirushi Access Company, Meihan Network Group, Dairy Foods Network Groups, etc. Through the systems of warehouses that already established by the wholesalers, Haagen-Dazs passes some of its responsibilities as well as distribution cost to wholesalers. The wholesalers will be responsible in delivering Haagen-Dazs ice creams to retailers in the some certain regions under their scope of operating.
In this case, Yukijirushi is responsible for delivering ice cream received from Haagen-Dazs manufacturers to retailers in the region like Jusco, Dalei, Ito Yokado, and Wal-Mart. Finally, the retailers continue passing the products to smaller retailers or to end consumers. Absolutely, Haagen-Dazs, the wholesalers, retailers have subsequently been adding more value into its ice creams when reaching the final consumers. [pic] Unified System of Ice Cream Distribution for Supermarket (Including Superstores) Source: Katsumasa Hayashi and James M. Hagen, Cooperation Among Competitors: The Japanese Super-Premium Cold Chain, Working Paper, March 2001.
Department of Applied Economics and Management, Cornell University, Ithaca, New York 14853-7801 USA. Haagen-Dazs distribution system is really superior. The marketers wisely discovered the potential of convenient stores. To the end of their decision, Haagen-Dazs marketers made their relationship with 7-Eleven Convenience Stores system which has been spreading out all over the world to push up their products as fast as they can. This is not just only a strategy for gaining market share but also for gaining of brand equity, and positioning of the products. [pic][pic] Source: Katsumasa Hayashi and James M.
Hagen, Cooperation Among Competitors: The Japanese Super-Premium Cold Chain, Working Paper, March 2001. Department of Applied Economics And Management, Cornell University, Ithaca, New York 14853-7801 USA. Wholesalers and supermarkets seem not be enough for Haagen-Dazs, they have been continuously looking for new opportunities to expand their products in the exclusive and luxurious places like five-star hotels and restaurants, airports, conventions. In Beijing, freezers selling Haagen-Dazs ice cream stand proudly in the lobbies of five-star hotels. The price for a pint of Swiss vanilla: $10, compared to around $3 in the United States.
Haagen-Dazs is the only ice cream producers can make them a place in a five star hotel; Ben$;Jerry is still not be able to catch this channel. Through this luxury distribution channel system, Haagen-Dazs is gaining its status in the perception of customers. More and more people believe that Haagen-Dazs means exclusiveness and even prestige. In this technology and telecommunication echo, World Wide Web becomes one of the most exciting and cheapest ways for marketing “battle ground. ” In fact, virtual distribution channel plays a very significant role in Haagen-Dazs distribution channel these days.
The network of Haagen-Dazs sites are constructed faster than ever, from U. S, Canada, Germany, Italy, England, Netherland, Malaysia, China, Philippine, etc. The inventory management mutually through virtual system between manufacturers, wholesalers, and retailers is gradually proving its effectiveness and efficiency. The Just-in-time (JIT) philosophy can be done more perfectly through virtual management. As the result, reducing the storage and delivery cost is a fact that nobody can deny. Furthermore, Haagen-Dazs also presents its strong distribution channels through vastly licensing to its franchises around the globe.
Until today, Haagen-Dazs franchises hundreds of its outlet to many different countries. Going much further, cafe with comfortable seating for couples, bar tools, dim lighting, rich colors all help to create an ambience of intimacy ; love. All cafes are located on prime streets, airports, or malls where young adults tend to hang out. Thus it enables maximum accessibility for the elite. Focus on this segment had moved away from actual cafes where they may be tempted by the non-low fat products and towards supermarkets, petrol pumps and other convenient areas.
Generally, the company has created more values for its products by a good marketing distribution channel. These strategies give ways for Haagen-Dazs values reach customers in very external systems which are believed more superior than other companies. 4. PROMOTION Success of one company also depends on how they advertise their products, which sales promotion program they pursue, what public relation, personal selling and direct marketing plans for the company. All of these come under the promotion mix. Advertising
Going to the first aspect of the promotion mix Haagen-Dazs applying for its company, there are various advertising campaigns being pursued during the last few years. At the beginning of this year, Haagen-Dazs has introduced a new series of its printing advertising posters. These posters are designed with completely new color panels. If it used to be “indulged” in red, dark brown colors, the new prints are impressive with colorfully attractive ice creams on white or ivory backgrounds. This color mixing creates a strong feeling of a completely fresh and new impressive ice cream, especially the Reserve Series, towards the adults.
The slogans appearing on these prints extremely stimulate the curiosity and desirable senses on the viewers. Just as some slogans for the new products posted earlier in this year “even more de leachable,” “Lady Toffee meets Lord Pudding,” “gifts from the God,” or “last berry standing. ” Using flavorful image and sensitive words on the printings has been committing to capturing the concern and gaining the perception of customers. Besides, Haagen-Dazs always negotiates for advertising spaces on street panels, cinemas, airports, universities, media, etc.
These kinds of advertising can be caught everywhere in the U. S. Looking at them day by day, the public perception and adoption for new products raise up faster than ever. Opening the corners of their mind, Haagen-Dazs marketers came up with the advertising campaign through Australian Postal Stamps. Cheap Haagen-Dazs stamps then travel around the world to many different people in many places. Source: Our New Print Advertising, Haagen-Dazs: http://www. haagen-dazs. com/company/print_ads. htm Sales Promotion The high prices of its products seem not easy for selling at all.
However, Haagen-Dazs has succeeded in convince customers that it’s worth tasting via attractive sales promotion programs. Recent years, Haagen-Dazs has been lunching many interesting promotion under many forms. The “Banana Split Dazzler” and the ‘Discover the Dazzler’ online game brought to customers and franchisees not only the new innovative products but also exciting games. Haagen-Dazs was giving away more than $11 million worth of prizes, including a 3-year 2001 Jaguar XK8 lease, $5,000 shopping sprees, free ice cream for a year for another promotion programs.
Although not noisily advertising in Malaysia, Haagen-Dazs still have some promotion programs. The ‘Affair De Chocolate’ ended at Jan 2007 gave consumers chances to win a grand prize worth RM 7,000 trip for a couple to Paris; the first prize of one year free of Haagen-Dazs ice cream supplying. At the early of this May (2007), a lot newspapers and magazines simultaneously posted the hot promotion program “First Haagen-Dazs New Flavor Day FREE cone event” announced by Haagen-Dazs to ice cream aficionados. The attention was strong enough to lead to a small movement in ice cream lovers.
Everybody was rush to Haagen-Dazs outlets in order to search and taste “the unique ice creams. ” Spending a lot of money for sales promotions, sales revenues of Haagen-Dazs have been substantially pushed up. This may be a big and worthy reward for good sales promotion strategy. Public Relations Most of the marketers are conscious of how important it is to build strong public relations. Haagen-Dazs executives always remind this significant role to their marketing staffs. There are almost no Haagen Dazs products being introduced to public without the support from newspapers, magazines, television stations.
Similarly to this year’s introducing of Reserve Series, it would have been very few people rushing to Haagen-Dazs outlets if there hadn’t appeared articles and announcements on the public Medias. One of the mottos of Haagen-Dazs is always active in public relations. Therefore, they set up separate Public Relation Departments in order to connect with the public. These departments regularly express the company’s image and commitments on newspapers, television shows. In addition, Haagen-Dazs often holds public event to get the attention of the public for their company.
When introducing the Reserve Series, Haagen-Dazs Japan and Australia connected their product promotion with special music concerts with the title “laid-back approach to music. ” Audiences listened to a violin concert on beds as they eat ice cream during the Dolce Heavenly Concert in Tokyo and Australia. They used to hold a contest in U. S as an event to show Haagen-Dazs prominent to other ice cream producers. In this contest, guests or passengers were invited to taste some unlabeled ice creams and gave marks for which they believed was the best.
The result was Haagen-Dazs ice cream got slightly higher marks than its closest rivals Dreyers. This event gave not only reputation for the firms but also warns and insights. Haagen-Dazs based on the result to predict the tastes and preferences of consumers. More than that, they received the warning from the rivals earlier so that they could prepare new strategies for competing. Perhaps the most important public relation of Haagen-Dazs until this point is Haagen-Dazs Clubs which gathers a lot of its ice cream aficionados.
This club is utilized to get the new ideas, complaints, and supports from supporters. Maintain a strong relationship with the public will provide the company a very competitive advantages to other competitors who lack of connection and support from the public. Personal Selling Although being considered as exclusive, Haagen-Dazs still develops strong personal selling. No consumer automatically comes to a company if the company doesn’t put out any effort. It’s not an easy task to persuade the buyers when the prices of its products are quite high.
However, the personal selling force inside Haagen-Dazs is often trained for needed skills in approaching with its target market. Salespeople sometimes don’t need to hang out; they just walk around in the outlets and talk to those customers who are enjoying ice creams to persuade customers inviting more of their friends, relatives to enjoy Haagen-Dazs also in return for some promotions. Direct Marketing Both Ben ; Jerry and Haagen-Dazs develop a very strong online marketing program. Lagging any efforts in direct marketing can be kicked out of the lucrative market.
Cooperating with its wholesalers, and retailers, Haagen-Dazs appeared on most of the selling and buying websites of its distribution channels inside and outside U. S market. Hence, Haagen-Dazs ice cream lovers everywhere are very easy to reach Haagen-Dazs products. VI. RECOMMENDATION Haagen-Dazs is a successful brand name in the ice cream industry, but that doesn’t mean Haagen-Dazs has nothing to do further to leave its competitors distantly behind its back. Ben ; Jerry, Baskin Robbins are not the only competitors who exceed Haagen-Dazs in some important markets.
Magnums, Wall, Breyers follow these biggest brands step by step. In order not to lose in the race with its competitors, Haagen-Dazs needs to exploit effectively its inherent competitive advantages as well as new opportunities in the immense ice cream market. Considering the current market targets, marketing mixes which have been discussed above, obviously there are still widely opened opportunities waiting for Haagen-Dazs taking action to lift itself to a higher level. Aiming at adults as the main target seems to be a wise strategy.
Adults are independent in income; adults are delicate enough in their tastes to enjoy super premium ice creams of Haagen-Dazs, and adults are also considered as more loyalty than teenagers. Yet adults are also believed stricter in evaluating quality and specialties of products. They also tend to be difficult in approaching new products. Unlike adults, teenagers in Y generation are often less loyal. However, they seem to catch up with the new easier and faster than the older. They are the catalyst for the spreading of new movement.
Thus, ignoring this segment may not be a good strategy at this moment. Besides broadening segments based on age, Haagen-Dazs should also look into income of consumers in the market. Most of Haagen-Dazs and Ben ; Jerry’s product being sold around the world are classified as super premium that only the upper classes or rich people can afford. Even when penetrating into Chinese market where middle class and lower class are dominant, Haagen-Dazs still focus only on upper class or even merely foreigners in this lucrative market.
As Eddie Lu, Marketing Manager of Haagen-Dazs in Shanghai stated: “In Beijing, freezers selling Haagen-Dazs ice cream stand proudly in the lobbies of five-star hotels. The price for a pint of Swiss vanilla: $10, compared to around $3 in the United States. People don’t mind paying for prestige items, especially if they are foreign. ” By this action, Haagen-Dazs is losing a big opportunity in the most potential market in the world. In reality, Haagen-Dazs hasn’t been the largest brand and taken the largest market share in China. Base on the China
Marketing and Media Study’s (CMMS) database, the top five brands in term of market share of ice cream in China recently consisting of Yili, Walls, Mengniu, Nestle and Meadow Gold hold 57 percent stake of the Chinese market. Foreign Giant Wall, Nestle and Meadow Golden own 30% while two domestic brands take another 27% of the total market share. Similarly, Haagen-Dazs has a stronger brand name in Korea but loses Baskin Robbins whose market share is claiming up to 60% of the total domestic market. However, Haagen-Dazs hasn’t been kicked out of this market.
Despite expensive and limited in the numbers of stores, Haagen-Dazs is popular among young people. Consumers are not only attracted by its flavors, but also its fashionable environment and good service. Therefore, broadening its market in China by a good pricing tactic at this time will be a resounding victory for marketers. It is absolutely clear that competitors always put their eyes on any tiny action of Haagen-Dazs. Whatever Haagen-Dazs is doing today will be imitated immediately. It’s nothing wrong if Haagen-Dazs also puts their eyes back on these rivals.
With a long history operating in United Arab Emirates (UAE), Baskin Robbins is launching an aggressive expansion campaign in the area “which will see the rise of more special outlet stores in key locations, including new property developments and shopping malls. ” The success of Baskin Robbins in this market is firmly asserted by Manoj Loya, General Manager – Operations, Galadari Ice Cream Company L. L. C. , (UAE), the franchisee for Baskin Robbins in the UAE: “Consumers trust and love is something we have earned over the last 25 years.
No premium or budget brand can attain that in a very short period of time. This is what makes Baskin Robbins unique. Our flavor library is the most extensive in the region and our products are some of the most exciting the region has seen. However we feel it is the love and trust that our customers have showered on us that makes us really unique. ” Haagen-Dazs doesn’t lose Baskin Robbins in the products’ quality and the variety in the flavors as well, but the race into Middle East’s market seems to be a tough mission for Haagen-Dazs.
In Middle East where Islam is the main religion, the luscious ice cream flavors as well as the romantic advertisements may not be welcomed at all. Although having taken some actions, Haagen-Dazs is still far behind Baskin Robbins’ success. Haagen-Dazs should do more researches on this market to find out what are the appropriate tastes, preferences as well as the acceptable images for Haagen-Dazs in this unique market. Specially, Haagen-Dazs should learn the effective franchising and distribution channels that Baskin Robbins applying over 25 years there. Through the domestic company, Galadari Ice Cream Company L. L.
C. , (GICC), who can understand clearly the culture and unique market of Middle East, Baskin Robbins opened 71 stores in the UAE alone with around 230 outlets across the GCC. Recently Baskin Robbins inaugurated its newest outlet in the UAE at Mall of the Emirates with plans for an even bigger store at Dubai Mall in the future. This is really a clever tactic that Haagen-Dazs’ marketer can take note for their actions later. Not only taking advantage of the immense Asian Market, but Haagen-Dazs should pay attention to research and develop for new recipes in this “Mysterious Orient” as one of its product strategies.
Ice cream mixed with liqueurs is really great, but it’s not always suitable to all people, especially to Muslims who cannot use liqueurs legally. In addition, the problem of healthy foods is rising in recent years. Consumers become more deliberate in choosing goods and services. Therefore, knowing how to make use of various herbal and traditional medicines of Chinese, Korean, and Indian into their product development can prolong the list of its currently attractive products. A successful strategy that Haagen-Dazs achieved in the last few years is introducing Green Tea Flavor into its bar ice cream sold in Japan.
Recognizing that Japanese people advance in drinking tea, Haagen-Dazs quickly grasp this taste, preferences, and come up with a completely new product “Green Tea Bar”. “The Haagen-Dazs brand is synonymous with fine ingredients and distinctive flavors. ” However, this is also creating some obstacles for themselves. Since the resources of high quality ingredients that Haagen-Dazs using are filtered from the finest such as dark chocolate from Belgium, handpicked vanilla bean from Madagascar, the macadamia nuts come from Hawaii. These unique ingredients are really scarce and costly in exploiting.
Hence, the prices of their products are often higher than their competitors. Especially for the new products being released this year 2007, the Reserve Series, Haagen-Dazs ice cream experts had to search the world over from the lush Amazon Rainforest to the warm Mediterranean to the volcanic slopes of Hawaiian Islands for the finest ingredients to perfect the flavor character in the products must. Thus, Haagen-Dazs should lunch a program or a better place strategy to develop its plants in the place where there are plentiful of quality resources and most convenient for transportation to many different locations around the world.
Once again, the “Romantic advertising campaign” of Haagen-Dazs seems unsuitable for teenagers if they decide to tap into this segment. They may be opposed by the public if the current luscious liqueur ice cream flavors are being introduced to teenagers. Haagen-Dazs needs to develop a new campaign aiming at this segment carefully. This strategy must be supported widely by the public, and not offense the morality and ethics of the countries where Haagen-Dazs are operating. Recently, the morality and ethic behaviors in the Japanese society have being debated on the political tables after several barbarous murders and slaughters among the young.
If Haagen-Dazs can build a model or prompt a program to revive the morality and ethics in the young Japanese through its advertising and products, it would be encouraged and supported by majority. As the result, Haagen-Dazs gains not only the market share but also the trustworthiness which builds up a strong customer relationship. Nevertheless, it should be kept in mind that broadening the target market must be followed by widely supported marketing strategies, here it’s promotion strategy. Through many summers, Haagen-Dazs is one of the official suppliers for Wimbledon Championship in Australia.
Marketing managers agree that Haagen-Dazs gained at least 8% revenues during the summers which the Wimbledon happened. Vividly, branding strategies directly impact the profit of the company. If applying the same strategy for the coming Olympic 2008 in China, a golden opportunity for Haagen-Dazs strengthening its brand name throughout the world is only the matter of time. Hundreds countries will send hundreds teams of many different sports to China for this international competition. Accompanied by the fact that China has been costly and carefully preparing for this event many years, millions of visitors will be coming to China next year.
A well–prepared branding strategy at this time can help Haagen-Dazs reach the highest position in the ice cream industry. Last but not least, controlling the operating of its franchises should be put on the managerial table for serious discussion. In the competition race, Haagen-Dazs has been rushing in maximizing its outlets so as to gain the market share as fast as possible but forgot to control the services and products’ quality offered at foreign franchises. Recently, the Chinese authority in China has discovered unqualified and unsanitary ice creams being served to customers in some Haagen-Dazs outlets.
As the result, bad words of mouth were quickly dispersed everywhere from inside of China to Europe, Japan, and home country. It harmed Haagen-Dazs reputation temporarily and the sales fell down unpredictably. A big lesson from this affair, Haagen-Dazs must gain its power in controlling international franchises stricter, setting up tougher conditions for franchising and outlets. At the same time, it should focus more on holding events that contribute to its inherent commitment and reputation so that it can gradually distract the public from such an affair.
VII. CONCLUSION Ice cream is a very dynamic industry. The sales growth has been increasing day by day while more and more manufacturers are joining into this game. It becomes impossible for those who want to conquer this market without coming up with new ideas, and smart strategies. Haagen-Dazs has been taking advantage for many years, but there is nothing can be sure that Haagen-Dazs is still dominant as years before if the marketers don’t work their ways out for wining stubborn competitors who follow them tightly.
By understands its strengths and weaknesses (internal factors) as well as opportunities and threats (external factors) deeply, Haagen-Dazs marketer team has built up a very impressive and attractive marketing mix that contributing directly to the successes of Haagen-Dazs times over times. Nevertheless, there are still many rooms for Haagen-Dazs to improve and take steps before its competitors grasp these opportunities and become violently threatening other players. Committing to its finest ingredients, best quality, or perfect marketing strategies are not enough for Haagen-Dazs to keep it position in this customer-oriented era.
It should be kept in mind that whatever policies and strategies Haagen-Dazs are following must be conformed to ethical and moral norms believed by the public. Abiding to particular legal system of a nation is not necessarily true that it is practicing ethically and morally. Thus, correct actions would be a good ways to earn public support which is believed the most important element to keep one’s foot in a highly competitive market like ice cream market. APPENDICES ICE CREAM LABELING – WHAT DOES IT ALL MEAN? There are many choices in today’s ice cream case to suit a wide variety of consumer tastes.
There is plenty of information on food labels, but what does it really mean? Here, the International Ice Cream Association sheds some light on how ice cream and related products are labeled. Labeling Definitions Here are some of the terms consumers are seeing in the supermarket, and exactly what those terms mean: • Ice cream is a frozen food made from a mixture of dairy products, containing at least 10% milk fat. • “Reduced fat” ice cream contains at least 25% less total fat than the referenced product (either an average of leading brands, or the company’s own brand. • “Light” ice cream contains at least 50% less total fat or 33% fewer calories than the referenced product (the average of leading regional or national brands. ) • “Lowfat” ice cream contains a maximum of 3 grams of total fat per serving (? cup). • “Nonfat” ice cream contains less than 0. 5 grams of total fat per serving. Quality Segments In addition, there are commonly used marketing phrases that describe ice cream products in terms of quality segments, such as “super premium,” “premium” and “economy. Several factors can contribute to a product’s quality segment, such as price, brand positioning, product packaging, quality of ingredients and the amount of overrun (air) in the product. Overrun refers to the amount of aeration the ice cream undergoes during its manufacture that keeps the mixture from becoming an inedible frozen mass. Overrun is governed by federal standards in that the finished product must not weigh less than 4. 5 pounds per gallon. • “Super premium” ice cream tends to have very low overrun and high fat content, and the manufacturer uses the best quality ingredients. “Premium” ice cream tends to have low overrun and higher fat content than regular ice cream, and the manufacturer uses higher quality ingredients. • “Regular” ice cream meets the overrun required for the federal ice cream standard. • “Economy” ice cream meets required overrun and generally sells for a lower price than regular ice cream. Source: IDFA, http://www. idfa. org/facts/icmonth/page5. cfm. [pic] JUST THE FACTS: ICE CREAM SALES AND TRENDS Overview • Total U. S. production of ice cream and related frozen desserts in 2005 amounted to about 1. 4 billion gallons, an increase of 0. 9% over 2004. Source: U. S. Department of Agriculture (USDA) • Based on ice cream consumption figures, the top five individual flavors in terms of share of segment in the United States are: vanilla (26%), chocolate (12. 9%), neapolitan (4. 8%), strawberry (4. 3%) and cookies n’ cream (4. 0%). Source: The NPD Group’s National Eating Trends Services • In 2005*, total U. S. sales of ice cream and frozen desserts reached $21. 6 billion. Of that total, $8. 2 billion was spent on products for “at home” consumption, while $13. billion was spent on “away from home” frozen dessert purchases (scoop shops, foodservice and other retail sales outlets. ) Source: 2006 Dairy Facts/International Ice Cream Association • Ice cream and related frozen desserts are consumed by more than 90% of households in the United States. Source: Mintel • According to 2005 U. S. production, regular ice cream accounts for the largest share of the frozen dessert market, at 63. 8%. Reduced-fat, light, lowfat and nonfat ice cream account for 23. 5% of the market, followed by frozen yogurt (4. 3%), water ice (4. 3%), sherbet (3. 6%) and other (0. 5%).
Source: USDA Production • In 2005, California once again produced the largest volume of ice cream and related frozen desserts in the United States, followed by Indiana, Texas, Minnesota, Illinois, and New York. Source: USDA • The United States leads the world in annual production of ice cream and related frozen desserts at about 1. 6 billion gallons in 2005. Source: USDA • In 2005, about 8% of the milk produced in the U. S. was used to make frozen dairy products. Source: USDA Sales • In 2003*, about 86% of packaged ice cream retail sales happened in supermarkets. Convenience store sales were second at 11. %, drug stores were third at nearly 2%, with 0. 6% occurring at other locations. Source: Mintel • Based on supermarket statistics in 2001*, ice cream volume sales by quality segment were: super premium (3. 5%), premium (51. 5%) and regular (45%). Source: IRI • Nearly 80% of supermarket ice cream sales are packaged in half-gallon containers. Source: IRI, 2001* Novelties • Novelties are separately packaged single servings of a frozen dessert – such as ice cream sandwiches, fudge sticks, fruit and juice bars – that may or may not contain dairy ingredients. • The total frozen novelty market in 2004 was valued at $2. billion, up 1. 3% over 2003. Source: IRI Magazine • In 2003*, about 62% of American households purchased novelties. Source: Mintel • Mirroring a similar trend in ice cream, vanilla is the top flavor for novelties, with more than 27% of the volume share. Fudge is the next highest stand-alone flavor share, with nearly 8%. Source: IRI, 2001* • In 2001 supermarket sales*, ice cream bars (25%) were the largest dollar market share of the frozen novelty market, followed by yogurt novelties (20%) frozen ice (14. 1%) ice cream sandwiches (13. 5%), and ice cream cones (10%). Source: IRI International Review Total U. S. exports of ice cream reached nearly 26,000 metric tons in 2005 – worth about $57 million. Source: USDA/International Ice Cream Association • In 2005, Mexico was the single largest market for U. S. frozen dessert exports, with an estimated value of almost $24 million. Canada was the number two destination for U. S. frozen dessert exports, valued at $5. 6 million. Japan ($4. 1 million), United Kingdom ($3. 6 million), and Hong Kong ($2. 8 million) are third, fourth and fifth respectively. Source: USDA/International Ice Cream Association Source: IDFA, http://www. idfa. org/facts/icmonth/page2. cfm. [pic]
U. S Ice cream trends – Dairy Market Trends – Brief Article Geographic Sales of Ice Cream/Sherbet Dollar Sales % change Pint Sales % change Region (millions) vs. YAgo (millions) vs. YAgo California $564 1. 2% 468 -3. 9% Great Lakes $704 4. 7% 741 -0. 5% Mid-South $627 10. 8% 638 0. 4% Northeast $862 3. 1% 824 -5. 2% Plains $324 9. 8% 398 7. 7% South Central $456 3. 4% 470 -1. 0% Southeast $601 4. % 652 -3. 4% West $541 4. 5% 517 -2. 0% Total U. S. $4,681 4. 9% 4,709 -1. 6% For 52 weeks ended Jan. 27, 2002 Source: Information Resources Inc. Top Ten Ice Cream Brands (Supermarkets Only) Dollar Sales % change Pint Sales % change Vendor (millions) vs. YAgo (millions) vs. YAgo Private Label $992 4. 4% 1,385 -4. 6% Breyers $520 $5. 4% 487 -0. 4% Dreyers/Edy’s Grand $367 3. 7% 334 -0. 6% Blue Bell $229 2. % 198 0. 0% Haagen Dazs $190 3. 3% 61. 9 -0. 6% Ben & Jerry’s $160 5. 0% 49. 7 1. 1% Well’s Blue Bunny $113 2. 5% 133 -2. 5% Healthy Choice $97. 6 8. 5% 90. 2 8. 7% Turkey Hill $96. 4 -0. 5% 109 -11. 6% Dreyers Edy’s $94. 4 23. 6% 85. 1 19. 2% Total Ice Cream $4,208 4. 0% 4,304 -2. 1% For 52 weeks ended Dec. 2, 2001 Source: Information Resources Inc. Top Ten Frozen Novelty Brands (Supermarkets Only)
Dollar Sales % change Volume Sales % change Vendor (millions) vs. YAgo (millions) vs. YAgo Private Label $337. 0 10. 8% 258. 0 3. 0% Klondike $143. 0 15. 9% 75. 3 7. 1% Nestle Drumstick $105. 0 7. 1% 39. 5 4. 0% Popsicle $91. 5 -1. 9% 52. 8 -3. 8% Haagen Dazs $52. 4 0. 4% 8. 7 -0. 9% Well’s Blue Bunny $48. 1 6. 2% 29. 0 -0. 5% Dole Fruit and Juice $43. 6 -4. % 15. 8 -8. 3% Silouette $42. 7 408. 6% 14. 4 415. 6% Fudgesicle $42. 6 10. 3% 19. 0 7. 8% Blue Bell Novelties $42. 1 3. 9% 27. 7 2. 6% Total Novelties $1,939. 0 7. 2% 1,017. 0 2. 8% For 52 weeks ended Dec. 2, 2001 Source: Information Resources Inc. Frozen Novelty Retail Dollar Share — 2001 Total frozen novelty retail dollar sales: $2. 1 billion (+7. 1%) Novelty Type % Dollar Share % Change vs. 2000 Ice Cream Bars with stick 17. 9% 2. % Sandwiches 13. 5% 19. 8% Frozen Ice 12. 5% -2. 7% Ice Cream Cones 9. 8% 15. 7% Fruit/Juice 9. 5% 9. 4% Ice Cream Bars without stick 7. 0% 6. 5% Fudge Bar 5. 9% 9. 7% Cups 3. 9% 6. 2% Push Tube 3. 0% 17. 8% Cream Bar 2. 4% -1. 3% Cookie Sandwich 1. 7% 22. % Italian Ice 1. 6% 24. 2% Bite Size 0. 8% 3. 4% Sorbet 0. 6% -19. 4% Frozen Yogurt 0. 2% -17. 7% Other 9. 7% — Total 100% — Source: Information Resources Inc. , courtesy IDFA COPYRIGHT 2002 Business News Publishing Co. COPYRIGHT 2002 Gale Group CHINA GAIN REPORT Retail Value of Processed Foods 2000-2004 (RMB millions) [pic] Growth Rates in Products Types [pic] [pic]
MAJOR U. S. FRANCHISES IN MALAYSIA: |Franchise |Local Franchise |No. of |Year |Territorial | | |Holder |Outlets |Established |Rights | |1. Kentucky Fried Chicken |KFC Holdings Bhd |300 |1973 |Malaysia, Singapore, Brunei | |2. Pizza Hut | |98 |1984 |Malaysia, Singapore | |3.
Seattle’s Best Coffee | |3 |2001 |Malaysia, Singapore, Brunei | |4. Kenny Rogers Roasters |Berjaya Group |34 |1994 |36 countries in Asia Pacific | |5. Roadhouse Grill | |3 |1994 |36 countries in Asia Pacific | |6. Starbucks Coffee | |24 |1998 |Malaysia | |7. -Eleven | |188 |1984 |Malaysia | |8. A & W |KUB Holdings Bhd |33 |1967 |Malaysia, Singapore, Brunei, Thailand, | | | | | |Hongkong, Korea, Philippines | |9. Gloria Jean’s Coffee |TT Resources Bhd |15 |1999 |Malaysia, Singapore, Brunei, Thailand | |10.
Dunkin Donuts |Golden Donuts Sdn Bhd |25 |1986 |Malaysia | | |(individual investors) | | | | |11. Baskin Robbins |Golden Scoops Sdn Bhd | 22 |1988 |Malaysia | | |(individual investors) | | | | |12.
Haagen-Dazs |HPL Group (Spore) |12 |1993 |Malaysia, Singapore | |13. Hard Rock Cafe | |1 |1988 |13 countries in Asia | |14. Planet Hollywood | |1 |1999 |Malaysia and Guam | |15. TGI Friday’s |Melewar Group |4 |1994 |Malaysia, Thailand, Singapore, Indonesia | | (Negeri Sembilan Royalty) | | | | |16. Chili’s Restaurant |T. A. S. Group (Pahang Royalty) |4 |1994 |Malaysia | |17. McDonalds |Golden Arches Restaurants Sdn Bhd|167 |1982 |Malaysia | | |(McDonald’s Corp, US owns 49%) | | | | |18.
Burger King |Cosmo Restaurants Sdn Bhd |9 |1997 |Malaysia | | |(individual investors) | | | | |19. Domino’s Pizza |Dommal Food Services Sdn Bhd |20 |1997 |Malaysia | | |(individual investors) | | | | |20.
Shakey’s Pizza |Shakey Restaurants Sdn Bhd |27 |1988 |Malaysia | | |(individual investors) | | |(holds the trade mark for Shakey’s in | | | | | |Malaysia, independent of Shakeys in U. S. ) | Source: Lay Hwa The, Industry Sector Analysis, International Market Research Report, 2005-08-31, Malaysias. URL: strategis. ga. ca HAAGEN-DAZS’ ATTRIBUTE, CONSEQUENCE, AND VALUES CREATED
Source: Wansink, B. ,2003,Using laddering to understand and leverage a brand’s equity, Qualitative Market Research: An International Journal, 6, issue:2, p. p 111-118. MCB UP Ltd. Available from: http://emeraldinsight. com/10. 1108/13522750310470118. [cited 8 November 2003]
Wansink, B. ,2003,Using laddering to understand and leverage a brand’s equity, Qualitative Market Research: An International Journal, 6, issue:2, p. p 111-118. MCB UP Ltd. Available from: http://emeraldinsight. com/10. 1108/13522750310470118. [