International%20Marketing%20Strategy

1
International Marketing Strategy

• Lauren Colvin
• Patrick Lynch
• Megan Revoldt
• Kate Turkcan

2
International Entry

• Identify a target market in the UK
• Adapt the product to fit target market
  preferences
• Design a supply chain that accounts for
  production and distribution
• Implement a communications strategy to reach
  target market and induce trial of product

3
Segmenting the Market

• 2029 age group
• Metropolitan
• University students
• Young professionals, single
• Need for convenient and inexpensive food option
• Parents
• Metropolitan Suburban
• Middle to Upper class
• Young childrenAge distribution between 514
  7,581,000
• Age distribution between 2539 12,915,000
• Influenced by children
• 60 age group
• Retired
• Need for convenient food options

4
Target Market

• 2029 Age Group
• Age distribution 7,599,000 people
• Single, working professionals
• Students attending universities
• Fast-paced lifestyle
• Seeking convenient, inexpensive alternatives to
  eating out and cooking
• Very brand conscious developed at an early age

• The Student Pound 14 billion annually
  26,864,766,335
• 43 of 18 24 year olds experience a form of
  higher education
• Spend a good deal of time
• At pubs and bars
• At the cinema
• In restaurants (mostly fast food)
• Participating in sports

5
Target Market

• VALS 2 Category
• Experiencers
• Young and compulsive
• Excited about new products that will give them
  the edge, or new experience they desire

6
Target Market

• PRIZM Segments
• Young Influencials
• Traditionally referred to as yuppies
• Middleburbs, college graduates, young
  professionals
• Up and Comers
• City centers, more mature, athletic activities,
  and night life
• Boomtown Singles
• 2nd city, young working class, high value on
  functional and convenient things in their lives

7
Adapting Uncrustables to the Market

• Modifying product to meet consumers preferences
  in the UK
• Replace current peanut butter jelly and grilled
  cheese filling with the combined ingredients
  pizza sauce, cheese and pepperoni
• 60 of frozen pizza salescheese and pepperoni
• Replace white bread with thin layer of pizza
  dough
• Pizza is one of the nations top 10 most
  frequently consumed foods.

8
Marketing Objectives

• Expected Sales (dollars and units)
• Frozen pizza sales US2004 2,782,254,592
• Uncrustables sales US2004 27,500,000
• Ratio 10.12 / 1
• To account for first-year product introduction in
  a new market, estimated sales will be 2 of UK
  frozen pizza sales
• Frozen pizza sales in the UK2004
  645,478,720.95
• 645,478,720.95 (.02) 12,909,574.42
• Estimated retail price 3.44 per unit
• Total units sold 3,752,783

9
Marketing Objectives

• Extent of Market Penetration
• Population of Target Market 7,599,000
• Objective is to induce trial and repeated
  purchase in 15 of target market.
• 7,599,000 (0.15) 1,139,850 consumers
• In order to reach expected sales value, each of
  the 1,139,850 consumers will have to spend
  approximately 10 on the product in 1 year

10
Brand Equity Positioning

• Creating a strategic alliance with Goodfellas
  Pizza, produced by Green Isle Foods and owned by
  Northern Food Plc
• Goodfellas is the leading frozen pizza brand in
  the UKowning 23 of the market.
• 2004 sales--148,472,836.31
• Average price range per unit1.942.99
  (3.695.69)
• Positioned as a quality pizza, made with the
  finest ingredients and designed to create a
  fresh-baked pizza experience in your own home.

11
Brand Equity and Positioning

• Partnership Agreement
• Green Isle Foods responsible for producing
  product in Naas facility
• Smuckers responsible for contracting
  distribution and storage
• Specific marketing team responsible for the
  co-branding of product
• Coordinate strategy consistent with Goodfellas
  and Smuckers image and reputation

12
Brand Equity Positioning

• Top competitors
• Chicago Town Pizzaowned by Schwans (US)
• 2004 sales--109,435,758
• Dr. Oetker Pizzafamily owned enterprise (GR)
• 2004 sales--53,852,413.24
• Positioned against the competitionGoodfellas
  Stuffed Pizza Pocket are an affordable,
  convenient, on- the-go, single serving of that
  great pizza taste that you expect from
  Goodfellas.

13
Product Branding Decisions

• Brand Name
• Goodfellas Stuffed Pizza Pocket
• Product Decisions
• Important factors
• Convenience
• Taste
• Price
• Cooking method
• Portion size

14
Core Product Decisions

• Stuffed Pizza Pocket
• 6 inch diameter
• Round in shape (like a small baked pie)
• Thin layer of pizza dough stuffed with pepperoni,
  mozzarella and provolone cheese, Goodfellas
  specialty sauce and sprinkled with parsley

15
Packaging Decisions

• Packaging Materials for Stuffed Pizza Pocket
• Cardboard box
• 1 stuffed pizza pocket wrapped in plastic
• Package Design
• Rectangular box
• Size takes into consideration small freezers in
  the UK
• Package Colors
• Primarily red, white and greenconsistent with
  Italian cuisine

16
Labeling Decisions

• Content
• Brand Name
• Visual of Stuffed Pizza Pocket
• Nutritional Information
• Ingredient List
• Preparation Instructions

• Shelf Life
• Storage Conditions
• Contact information for Green Isle Foods
• Place of Origin
• Bar Code

17
Distribution Decisions

• Manufacture of Product
• Green Isle Foodswholly owned subsidiary of
  Northern Foods plc
• One of the UKs largest food manufacturers
• Produce frozen convenience foods for the Irish
  and UK retail markets

18
Distribution Decisions

• Green Isle Foods operates facilities in Ireland
• State-of-the-art manufacturing technology in
  plants
• Described as a specialist in food conversion /
  assembly, with manufacturing capability as its
  core competence.
• Flagship facility for pizza is the plant in Naas,
  Co. Kildare
• Recently expanded under a 25 million investment
  projectincorporated the most advanced baking,
  topping and packaging technology.

19
Distribution Decisions

• Distribution of Product
• McBurney Refrigeration Ltd
• Full range of refrigeration haulage
• Depots in Dublin and Liverpool
• Cold storage and chilled food distribution center
  on a 12 acre site in Liverpool to service
  increasing food import traffic from Ireland

20
Distribution Costs

• Trucking from production facility in Naas to port
  in Dublin (17 miles)
• 2.11 per mile (17 miles) x 2 for refrigeration
  71.74
• Round trip 143.48 per truck
• Each truck can hold 10,000 lbs
• One box 0.8 lbs
• Each truck can transport 12,500 boxes
• Need to transport 308,430 boxes per month
• 308,430/12,500 25 trucks per month
• 25 trucks x 143.48 3,587 month x 12 43,044
  
• 43,044 34 markup 57,679 per year
• Source Freight Transport Association of UK

21
Distribution Decisions

• Distribution of Product
• Dublin Port Company
• The Gateway between Ireland and the World
• Principal port in the Republic of Ireland
• Positioned at the hub of national road and rail
  network
• Has terminals and facilities to the highest
  industry standards

22
Distribution Decisions

• Distribution of Product
• Derek Horner Agencies Ltd.
• Customs clearance is performed in-house
• Full port agency services
• Containers provided to suit all types of cargo
• Temperature controlled containers
• 1 sailing weekly from Dublin to Liverpool

23
Distribution Costs

• Ferry from Dublin to Liverpool
• 6 trucks per week holding 60,000 lbs of product
• Shipping 60,000 lbs 22,800
• Includes refrigeration and markup
• 22,800 x 52 weeks per year 1,185,600 per year

24
Retail Distribution Regions

• Shipping to 12 regions throughout the UK
• Each region maintains 100 trucks, which operate
  through a centralized warehouse equipped with
  frozen storage facilities
• Trucks then disperse to assigned retail outlets
  using a just-in-time inventory system

25
Distribution Decisions

• Retail Outlets within UK regions
• Tesco10 depots supply to 779 stores
• Somerfield15 depots supply to 1,275 stores
• Sainsbury12 chilled depots supply to 498 stores
  
• ASDA19 depots supply to 258 stores
• Safeway18 depots supply to 481 stores

26
Distribution Costs

• Trucking from Liverpool to regions, then regions
  to retail outlets
• 1,200 trucks total
• Cost per truck 1,564
• 1,564 x 1,200 trucks 1,876,800 per year
• Storage costs throughout the 12 regions
• 10,000 per warehouse in each region x 12 regions
  120,000 (markup and refrigeration included)
  per year

27
Total Costsper unit

• Production costs 15 of 2.50 retail price (US)
  0.38
• Truck from Naas to Dublin 0.02
• Ferry from Dublin to Liverpool 0.32
• Trucking throughout UK 0.50
• Storage in UK 0.03
• Total cost per unit 1.25
• 50 markup
• Total revenue 1.87
• 60 markup 1.12
• Retail before tax 2.99
• 15 markup 0.45
• Retail after VAT 3.44 1.80

28
Promotional Budget

• Profit per unit 0.62
• Total profit 2,326,725
• Northern Foods receives 55 of the profits
• 35 of profits go towards compensation for
  production costs which are 30 of the total costs
• Payment for use of Goodfellas brand name 20
  of profits
• Northern Foods profits 1,279,699
• Smuckers profits 1,047,026

29
Promotions Decisions

• Communication Objectives
• Create awareness of the Goodfellas Stuffed Pizza
  Pocket among 25 of the population between the
  age of 2029, specifically those in need of a
  convenient, affordable and quality product within
  one year.
• We hope to stimulate trial among 15 of target
  population.

30
Promotions Decisions

• Overall Message
• Stuffed Pizza Pocket is an affordable, easy to
  prepare and consume product for those on-the-go
  and time-constrained members of the target
  market.
• Purpose of the productmake the daily hassles of
  cooking less of a burden for the target market.
  Allows them to focus their energies elsewhere.
  The size and quantity of the product make it a
  reasonable substitute for a traditional meal.

31
Promotional Decisions

• Creative Strategy
• Deliver clear, compelling message
• Emphasize what is important to target market
• This age group cares about saving money
• Consistent message
• The Big Idea
• Keeps you and your wallet stuffed

32
Media Vehicles

• Outdoor Advertising91 of promotional budget
• 952,794
• Objective Create awareness and stimulate
  interest in product among the target market
• Reach and Impact
• Increases product credibility
• Strategically placed in high traffic areas and
  easily viewed
• Creative and memorable

33
Media Vehicles

• Outdoor Advertising
• Billboards
• Contract with ClearChannel Billboards
• Purchase campaign type National Cover A which
  allows for 100 billboards throughout the UK
• The budget will not allow for continual display
  of billboards throughout the one year period
• Billboards will appear at the introduction of the
  product to create awareness and will reappear
  throughout the year to serve as a reminder to the
  target market
• Billboard expenditure 688,745

34
Media Vehicles

• Outdoor Advertising
• Ambient Media Expenditure 264,049
• Viacom Media offers general site packages for
  Tube display

35
Media Vehicles

• Sales Promotions9 of promotional budget
• Objectiveto engage and motivate potential buyers
• Supplementing advertising and facilitating
  personal sellingpromotional giveaways
• Goodfellas and Smuckers brand reps distribute
  t-shirts at local pubs/bars in each region
• 12,000 t-shirts x 0.33 ea. 3,960 per month
• Annual cost 47,520
• Generate buzz and word-of-mouth
• Sales promotion expenditures 47,520

36
Media Vehicles

• Public Relations
• Objectiveto promote a positive image, generate
  publicity and foster goodwill
• Promotion on Green Isle Foods website
• Promotes that product is available and relatively
  inexpensive method of communication
• Other Examplesmedia coverage, hosting special
  events and sponsoring charitable campaigns
• Disadvantagescost, lack of control
• Not feasible at this time beyond website
  publicity

37
Media Vehicles

• Direct Marketing
• Objectivethis form of advertising is aimed
  directly at target consumers, usually in their
  homes, attempt to get them to take action
• Examplescatalogs, coupon mailers and letters are
  common forms of direct marketing
• Not an effective approach to reaching target
• Not feasible at this time

38
Media Vehicles

• Event Sponsorship
• Objectiveopportunity to reach niche market,
  create awareness and enhance image
• Relatively new product and Insufficient funds
• Not feasible at this time

39
Media Vehicles

• Advertising
• Any paid form of media communication
• Televisionhigh absolute cost, high production
  cost, short message life
• Radiolow attention getting, audio only
• Print
• Magazineslong lead time for placement, visual
  only
• Newspaperspoor reproduction quality, selective
  reader exposure
• Disadvantagescost, lack of feedback
• Not feasible at this timewill pursue options
  upon growth of product

40
Summary

• Target market20-29 years old
• Strategic alliance with Goodfellas Pizza
  (Northern Foods plc)
• Stuffed Pizza Pocket Keeps you and your wallet
  stuffed
• Produced in Ireland and distributed throughout 12
  UK regions
• Product promoted through outdoor advertising,
  ambient media and sales promotions