session 2 - 2015 - case pan am + international marketing plan.pdf

8/16/2019 Session 2 - 2015 - Case Pan Am + International Marketing plan.pdf

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The international marketing plan


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Topics for today

1.Discussing thePan Am case

2.The internationalmarketing plan

3.Example of aninternational

marketing plan


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marketing plan


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Solution will be provided after the session


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marketing plan


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Tactics

Strategy

Analysis Where are we tod ay?

Where do we wan t to go ?

How are we going to g e t there?

Control Did w e get there?


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Analysis

Strategyformulation

Tacticaldecisions

Marketingcontrol

Micro-environment

Meso-environment

Macro-environment

Segmentation, targeting,positioning

Product

Price

Place

Promotion

Necessary for

Influences

Combines with

Analysis of the organization’s financial and commercial resources

Analysis of potential clients:Consumers, businesses

PESTEL analysis: Political,Economic, Societal, Technological,Ecological and Legal environment

Combines with

Combines with

Combines with

Combines with

Combines with

Isdetermined

by

Isdetermined

by

Isdetermined

by

- Pricing method: Cost-plus,competition-based & value-based

- Pricing tactics: Promotions,psychological pricing,…

- Branding- New product development

- Multichanneling decisions- Channel selection

- Integrated marketingcommunications

Marketing metrics

Traditional marketing plan


8/45International marketing plan

Analysis

Strategyformulation

Tacticaldecisions

Marketingcontrol

Micro-environment

Meso-environment

Macro-environment

Marketing mix

After-sales service

Necessary for

Influences

Combineswith

Analysis of the organization’s potential to go international

Analysis of potential clients:- Consumer behavior- Language

Analysis of foreign markets- PESTEL analysis- Trade barriers & agreements- Culture

Combines with

Combines with

Combines with

Isdetermined

by

Isdetermined

by

Isdetermined

by

Standardization or adaptation of price,promotion, product and place

Positioning andSelection of entry mode

Building brand associationsEntry mode research

International aspects of after-salesservice

Intl. research Data equivalenceResponse styles

Combines with

Marketing metrics Marketing dashboardsIs

determinedby


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marketing plan


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11/45Source: http://news.starbucks.com/uploads/documents/AboutUs-CompanyProfile-Q3-2013-9.18.13.pdf


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“Our stores are a neighborhoodgathering place for meeting friendsand family. Our customers enjoyquality service,

an inviting atmosphere and anexceptional beverage .”

Source: http://news.starbucks.com/uploads/documents/AboutUs-CompanyProfile-Q3-2013-9.18.13.pdf


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Products

• Coffee: More than 30 blends and single‐origin premium coffees.• Handcrafted Beverages: e.g. Fresh ‐brewed coffee, hot and iced

espresso beverages, Frappuccino® coffee and non ‐coffee blendedbeverages,…

• Merchandise: e.g. Coffee ‐ and tea ‐brewing equipment ,…

• Fresh Food: e.g. Baked pastries, sandwiches, salads ,… • Consumer Products

o Coffee and Tea: e.g. Whole bean and ground coffee (Starbucksand Seattle’s Best Coffee brands ), Starbucks VIA® Ready Brew,...

o

Ready to

Drink (RTD): e.g. Starbucks® bottled Frappuccino®coffee drinks, Starbucks Discoveries® chilled cup coffees ,…


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Financial information

• Enterprise value: $42 Billion

• Revenue: $1,7 Billion

• Profit margin: 10.50%

• Operating margin: 13.66%

• Stock price: (introduced at $…)


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Corporate social responsibility• Ethical Sourcing: We take a holistic approach to ethically sourcing the

highest quality coffee. This includes responsible purchasing practices,supporting farmer loans and forest conservation programs. When we buycoffee this way, it helps foster a better future for farmers and a more stableclimate for the planet. It also helps create a long ‐term supply of thehigh ‐quality beans we’ve been carefully blending, roasting and packing fresh

for more than 40 years.• Environmental Stewardship: We share our customers' commitment to theenvironment. And we believe in the importance of caring for our planet andencouraging others to do the same. We are working to significantly reduce ourenvironmental footprint through energy and water conservation, recycling andgreen construction.

• Community Involvement: From the neighborhoods where our stores arelocated to the ones where our coffee is grown – we believe in fostering thrivingcommunities. By 2015, we hope to contribute one million volunteer hours eachyear to our communities.



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Active in many countries …


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To be more specific…

Argentina, Aruba, Australia, Austria, Bahamas, Bahrain,Belgium, Brazil, Bulgaria, Canada, Chile, China, Costa Rica,Curacao, Cyprus, Czech Republic, Denmark, Egypt, ElSalvador, England, Finland, France, Germany, Greece,Guatemala, Hong Kong/Macau, Hungary, India, Indonesia,Ireland, Japan, Jordan, Kuwait, Lebanon, Malaysia, Mexico,Morocco, New Zealand, Netherlands, Northern Ireland,Oman, Peru, Philippines, Poland, Portugal, Qatar, Romania,Russia, Saudi Arabia, Scotland, Singapore, South Korea,

Spain, Sweden, Switzerland, Taiwan, Thailand, Turkey,United Arab Emirates, United States, Vietnam and Wales.



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Americas

76%

Europe,

MiddleEast,Africa

9%

China & EastPacific

5%

Channeldevelopment

10%


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Between 2001 and 2003,Starbucks opened 6 stores inIsrael

All six stores were closed in 2003


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Source: http://www.just-food.com/analysis/what-went-wrong_id93573.aspx


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Goal of the marketing plan

• Re-entering the Israeli marketo What went wrong in the past?o How can we fix this?


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Macro

Meso

Micro

Tactics

Strategy

Analysis

Control


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Analysis of the macro-environment

• Economico GDP per capita, growth, personal disposable income

per capita,… • Demographic

o Gender and age distributiono Distribution over the six districts (Jerusalem, Haifa,

Central, Tel Aviv, Southern and Northern district)• Social and cultural

o Links with the U.S. and E.U.o Relatively homogenous population


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Analysis of the macro-environment

• Technologicalo High penetration of mobile deviceso Wi-Fi networks

• Ecologicalo High ecological awareness

• Politicalo Unstable regiono 2001: Failure of Camp David peace negotiations

• Intensified economic recession• People spent less time outside => Many coffee shops and

restaurants closed


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Analysis of the meso-environment

• Consumerso Habit of coffee drinking and sitting in coffee shopso Coffee is important!

• Developed a sensitive taste for it•

American coffee did not match their taste preferences, as it was to weak andbitter• Prefer Italian coffee

o Coffee shop should be more than coffee• Israeli consumers prefer to accompany their coffee with a side

snack• Expect an assortment of food• Large breakfast

• Eggs, vegetables and cheese (different from Continental breakfast)

• Wi-Fi connection


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• Competitorso Direct

• lsraeli coffee chain Aroma• 145 locations, market leader (# stores and brand awareness)

• Elite Café• Coffee sold by one-person operated coffee ‘wagons’

• Arcaffé• Very high quality, more expensive

• Greg coffee

• Private owners (local coffee shops)o Indirect:

• Café Café and Café Joe: Mainly light meals, coffee is not thecore business

• Substitutes: Nespresso


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Distribution of coffee shops in Israel


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Location of the coffee shops


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• Competitorso Risky environment with low profitability

• Break even after 3 years (coffee chain) or 4 to 5 years (private)• Investment: $250,000 for an Aroma branch, $500,000 for an

Arcaffe branch• Expansion through franchising


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Starbucks’ experience with the Israeli market

• Standardization versus adaptationo ‘American’ products were sold

• Necessary to adapt to local taste and demand for more foodoptions

• KFC, Burger King, and Subway had the same experience• McDonald’s adapted to the local market by offering special meet

dishes for the Israeli market (Kosher restaurants)

• Bad choice of locationso All stores were opened in the Tel Aviv district

• Highly competitive environmento Stores were opened just across Arcaffe stores

• Arrogant message

o Stores were opened in main streets


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• Competitive environmento Significant growth of coffee shops in the ‘90s o Competitors were prepared

• After hearing Starbucks would enter the Isreali market, theyupgraded their coffee shops and product lines

• Bad choice of partnershipo Investor Delek group owned 80% of Starbucks Israel

• No experience with coffee shops (energy, real estate ,…)

• Limited patience for losses• Unwillingness to increase risk


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• Failure to reach the desired positiono Starbucks was well perceived by the Israeli customer

initiallyo Did not sustain

• Quickly perceived as experience, not rewarding• Not only coffee and food quality, but also service quality


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Tactics

Strategy

Analysis

Control

Market Segmentation Targeting Positioning


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Target segment

• Three segmentso Business people

• Use Starbucks as a meeting placeo Tourists

• Familiarity with the brando Israelis

• 20- to 50-year olds with an above average income• No families• Why?

• Military service for men -> many people finish university in their late ‘20s • Older people mainly visit shops close to their home


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Positioning

• Competitor Aroma is found everywhereo like for example Starbucks in NY

• Keep the initial positioning of Starbuckso ‘More than a coffee shop’ o Add an international flavor

• Israelis are oriented quite internationally• Traveling abroad has become a prominent and escapist motive

• ‘Like abroad ’ is often used to describe features that ave a non-Israeli (U.S. or E.U.) touch


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Market entry mode

• Franchisingo No direct investment

• Risk = too higho No cooperation with Delek Group

• No experience with coffee shop or food markets• Selection of a partner that has experience in the food industry


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Product

• Customization is keyo Stronger coffeeo Light meals

• > sandwiches and cakes

• Pastas and breakfast

• High levels of service


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Place

• Locationo Avoid face-to-face competitiono Jerusalem and parts of Tel Avivo Near tourist attractions

• E.g. Natanya (Northern seaside) and Ashdod (Southern seaside)• Israel International Airport

o Near high tech campusses like Ra’anana and Herzeliya

• Shopso Not really necessary to change the looko Free WiFi connection


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Price

• Competitors

Note: €1 = 4.8 New Israel Shekel

• Similar prices than Arcaffe


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Source: The Wall Street Journal


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Promotion

• Starbucks generally does not invest in traditionaladvertising (TV, radio, billboards,…)

• Public relationso Publicly acknowledge the mistakes made previouslyo Mention the global CSR programo Viral ads (Facebook, Twitter): Highlighting special

features of its products


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See you next week!

session 2 - 2015 - case pan am + international marketing plan.pdf

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