Jamba Juice Expansion Plan


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Market Entry/Expansion Plan for Jamba Juice

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Jamba Juice Expansion Plan

  1. 1. Jamba Juice Best Opportunity for Expansion in the United Kingdom Team 12 Tiffany Dang Brent Edwards Emily Evans Allison Stokes Alicia Tikalsky
  2. 2. Executive Summary This marketing proposal describes Jamba Juice’s plan to expand its business into the United Kingdom. The target market was determined by the eight O’s characteristics, with occupants being citizens ages 15-34 years of age and the object being Jamba Juice’s whole idea of a healthy yet convenient service. The other O’s considered were occasions, objectives, outlets, organization, operations, and opposition. For market coverage, we decided to use an undifferentiated market coverage strategy, similar to the one that was successful for the United States. Jamba Juice’s core component will be to provide customers with an easy option to live healthy by offering nutritious beverage and snack options. Another alternative to the in-store products will be make-at-home smoothies that will be offered in grocery stores. These products will follow Jamba Juice’s mission to have customizable natural beverages. For the packaging component, we decided to go against the Styrofoam cups that are used in the majority of United States Jamba Juice stores and instead choose a more eco-friendly and recyclable option with using paper cups instead. Our support service will provide exceptional customer service specifically for our United Kingdom customers with well-trained employees and a 24/7 hotline. Our marketing tactics will meet our main objective to have Jamba Juice as the largest active, healthy lifestyle company in the United Kingdom. The steps to do so include identifying our target audience, developing specific campaign objectives, creating a budget, determining a media mix, establishing the campaign message, determining a strategic campaign approach, and evaluating the campaign effectiveness. Our media mix will reach consumers online through various mediums inclucing social networking sites (Facebook, Twitter, etc.), strategically placed ads on the internet, as well as airing television commercials during prime viewing time. The primary marketing message is to establish Jamba Juice as a healthy , “lifestyle brand that really stands for great-tasting, good-for-you nourishment.” 19 The secondary message is that there is a wide variety of fruits, juices, yogurts, and boosts that consumers can choose from to enjoy. Key sales promotions to increase brand awareness include “Buy One, Get One” campaigns and a frequent buyer card reward program that will create a loyal relationship between customers and Jamba Juice. Our channels of distribution will go through independent intermediaries at a local level. Producers, agents, wholesalers, retailers, and customers will all be included in the channel configuration. It is necessary to go through local agents as we want our Jamba Juice smoothies to have the finest and freshest ingredients possible. To aid in determining the appropriate approach to distribute our products, the 11 C’s checklist will be used. Some of the 11 C determinants include customer characteristics, competition, cost, character, and capital. Since Jamba Juice’s product line does not vary throughout the world, so we recommend that Jamba Juice uses a standard worldwide pricing strategy. Once Jamba Juice enters the United Kingdom market, we plan on executing a market pricing strategy that will based on our competitor’s pricing, Crussh smoothie maker. Because we will use the standard worldwide pricing strategy, the Jamba Juice smoothie prices will be the same as the prices in the United States and the Bahamas, which is about $4 per smoothie. In the United Kingdon, this is equal to € 3.25 per smoothie, making it the same price as a Crussh smoothie. Jamba Juice hopes to achieve the long-term goal of becoming the market leader within four year of market entry. A. Marketing Objectives 2
  3. 3. 1. Target Markets Now that Jamba Juice is expanding into the United Kingdom, it is important for them fully understand their target market. A target market can be defined by eight important characteristics: occupants, objects, occasions, objectives, outlets, organization, operations, and opposition. The occupants, or citizens of the United Kingdom, will define Jamba Juice’s marketing strategy. Currently, there are 61,621,000 citizens residing within the United Kingdom.1 Roughly 26% of these citizens fall within Jamba Juice’s target age range of 15-34 years of age.2 Citizens who fall into this demographic define our target market because they are most likely to purchase our product due to its convenience, nutrition, popularity and a multitude of other factors. The objects within the target market of the United Kingdom are vital to understand because it is this object that ultimately fulfills the market’s need. Jamba Juice’s object is not only a smoothie; it encompasses the physical smoothie itself as well as the idea of healthy eating and the quick convenient service provided in a friendly environment. The specific event of a purchase, or the time period when customers are more apt to buy Jamba Juice’s object is the occasion. Jamba needs to fully understand the cyclical nature of the occasion and how it directly affects consumer’s objectives in regards to their object. An objective is the motivation behind a customer’s purchase. For example, Jamba Juice must understand that in winter months the sale of smoothies will decrease. In the occasion of winter months, Jamba Juice must account for the change in customer’s objectives and should address this shift by using hot oatmeal or chai tea drinks to create a hidden value that customers are looking for. In order to spur customer’s objectives for Jamba Juice they need to create and maintain the appropriate outlets, the location consumers will purchase the objects. It will be important for Jamba Juice to recognize the motivation, the occasion, behind consumer purchases. For example, convenience is of high significance to our target market, therefore choosing a highly convenient outlet is equally significant. As a marketer it is imperative to understand the organization within a customer’s mind as to how and why they make the purchasing decisions they do. This organization begins in the consumer’s mind well before they make a purchase. Jamba Juice needs to recognize what other factors play a part in the decision making process such as: proper nutritional consumption, current trends, and fulfilling basic hunger needs, just to name a few. Jamba Juice operates as a leading brand within the United States displaying multiple reasons as to why it could successfully penetrate the smoothie market on a global scale. The current operations within the United States and the Bahamas are perfect measuring sticks. They provide clear evidence through their successful operation of more than 740 smoothie stores, even in the face of opposition.3 Jamba Juice has effectively surpassed other smoothie opposition like Maui Wowi, Smoothie King, and Planet Smoothie in the United States by nearly 150 stores each.456 This clearly indicates that their top competition in the United Kingdom, Crush and its 23 locations, will provide opposition Jamba Juice will be able to ultimately overcome.7 Focusing on these eight components of marketing will allow Jamba Juice to successfully define their target market, allowing them to continue to grow in a global setting. 2. Market Coverage 3
  4. 4. We recommend that Jamba Juice use an undifferentiated market coverage strategy. Jamba Juice is currently functioning under this strategy in the United States, and we suggest they implement this same strategy when entering the United Kingdom market. We do acknowledge cultural differences and social norms must be accounted for when entering a new market, and suggest directing Jamba Juice’s undifferentiated marketing strategy towards the demand of the target market of 15-34 year olds as a whole. This undifferentiated marketing strategy would also account for health conscious, trendy, on-the-go individuals. We feel this is a strong strategy to implement based on Jamba Juice’s successful history within the United States. Jamba Juice has more than 30 different varieties of custom smoothies and ‘Jamba boosts’ along with other fruit juices and food items. These product offerings allow Jamba Juice to adopt the cost effective undifferentiated strategy because virtually all consumer objectives are met. Clearly, an undifferentiated marketing strategy fulfills all consumer needs as well as market demands paving the way for successful market penetration. A. Product Adaptation or Modification 1. Core Component A motto that Jamba Juice utilizes in the United States is “Created by nature, blended by Jamba.” This perfectly sums up Jamba Juice’s mission to provide the consumer with a natural product that is customizable to their personal preferences.8 Jamba Juice’s smoothies consist of a myriad of different fruits, yogurt blends, and fresh squeezed juices. The company’s main goal will be to provide customers with an easier option to live healthier by choosing nutritious snacks and beverages. For customers’ convenience, Jamba Juice will also offer make-at-home smoothies in local grocery stores. Similar to the U.S. in store smoothies, each packet of make-at-home smoothie will contain real fruit, non-fat yogurt as well as a vitamin C boost that provides the consumer with 100 percent of their daily value of vitamin C. The only additional ingredient needed is apple juice to help liquefy the fresh smoothie.9 In addition to the vitamin C boosts, the in store smoothies can be customized with over 10 other boosts, including: a pro-biotic boost, a 3G charger super boost, flax and fiber boost, a calcium boost, a daily vitamin boost, a whey protein super boost, an antioxidant boost, a soy protein boost, an energy boost, as well as an energy boost. 10 These boosts, along with the large selection of fruits and yogurts, allow the consumer to create their own personal smoothie and customize their product according to their specific needs. 2. Packaging Component With Jamba Juice’s bright, colored Styrofoam cups, it will have no problem differentiating itself from any competitors. The designed cup will become quickly recognizable through out the UK, which will add to brand loyalty. Although, in the U.S. most Jamba Juice stores use Styrofoam cups, which take thousands of years to degrade, Jamba Juice in the U.K. intends to use a more eco-friendly cup such as paper that can be 4
  5. 5. recyclable.11 With the use of a more eco-friendly cup, consumers will be more likely to purchase a smoothie from Jamba Juice without worries of hurting the environment; leading to more satisfied customers. Cities who have already successfully switched to paper cups are Berkeley, Santa Cruz, and San Francisco.12 3. Support Services Component Just like all Jamba Juice locations, customer service will be key for our ventures in the United Kingdom. Customers can expect friendly service, clean locations, and an enjoyable atmosphere. There will be a readily available hotline 24/7 for any questions regarding Jamba Juices products or services. Our employees will also be well educated and trained to answer any nutritional or ingredient questions regarding any smoothies or snacks on the menu. As well as smoothies and snacks, our U.K. stores will sell nutritional cooking books, environmental friendly water bottles and thermoses, to-go snacks, and Jamba Juice logo t-shirts and hats. C. Promotion Mix 1. Advertising a. Objectives Our primary marketing objective is to make Jamba Juice the largest active, healthy lifestyle company in the United Kingdom, and use this success to eventually expand into other markets. We plan to do so by following a strategic plan using these specific steps: ·Identify our Target Audience: Our product does not cater to any particular age or gender, so all demographics will be considered. However, our primary target market that Jamba Juice will try to attract is people ages 15-34 years old. ·Develop Specific Campaign Objectives: Our objective is to gain 30 percent of the market share of the grab-and-go beverage market within 4 years. We plan on doing this by increasing brand awareness in the United Kingdom using a “push” advertising campaign.13 This will be the most effective because we will be selling directly to the consumer and bypassing intermediaries and other distribution channels. We will use personal selling and trade promotions as promotional tools. ·Create a Budget: Because Jamba Juice is an unknown brand in the United Kingdom, an ample advertising budget is needed to increase brand awareness in the new market. We intend to spend the majority of our budget on advertising, trade promotions, and sales force. ·Determine a Media Mix: See section b. ·Establish The Campaign Message: See section c. 5
  6. 6. ·Determine a Strategic Campaign Approach: Jamba Juice has a quality product that is likely to quickly gain a following in the United Kingdom, just as it has in the United States. Our goal is to develop long- term relationships that keep customers coming back time and time again. We intend to meet their need on a business level, meaning offering quick, efficient service in clean and convenient locations increasing their satisfaction with Jamba Juice. We want to increase their commitment on a more personal level. Friendly customer service as well as rewards promotions will keep our customers returning to us, as well as increase our reach with positive word-of-mouth to consumers unfamiliar with our brand. By increasing commitment and satisfaction, we will develop lasting relationships with our customers. ·Evaluate Campaign Effectiveness: In order to evaluate our campaign’s effectiveness, we plan on conducting research to see if we are meeting our goals. Focus groups and surveys will be conducted to gather data to analyze. b. Media Mix Currently the leading advertising medium in the United Kingdom is the Internet. According to a study by PricewaterhouseCoopers and the Internet Advertising Bureau, online advertising accounted for 23.5 percent of the total advertising in UK in the first half of 2009. 14 The average English citizen spends 164 minutes online each day. 15 Jamba Juice can use similar tactics that they have in the United States, reaching consumers online—through strategically placed ads, as well as social networking sites such as Facebook, Twitter. Social Networking site hits have over taken 16 search engines as the most heavily visited sites and they will be instrumental in our media mix. Additionally, English citizens spend 148 minutes watching television on average. 17 We suggest that Jamba Juice air commercials during prime time, or peak time as they call in the UK-- 6:00pm to 10:30pm will reach the most viewers at a time. 18 c. Primary Message and Secondary Message According to Jamba Juice founder, Kirk Perron, Jamba Juice’s primary marketing message is to establish itself as a healthy, “lifestyle brand that really stands for great-tasting, good-for-you nourishment.” 19 The message should continue to be the primary focus in the United Kingdom, and if they decide to expand even further. The secondary message is that the consumer can choose from a wide variety of fruits, juices, yogurts, and boosts to create a beverage they can enjoy. 2. Key Sales Promotions: Objectives and Tactics In order to increase sales in the United Kingdom, Jamba Juice must first increase its brand awareness. Jamba Juice has a quality product that is one of their competitive strengths, so allowing consumers to try the smoothies should be a priority. Sales promotions, such as the “Buy One, Get One” campaign, have been extremely successful in the United States and should be implemented in the United Kingdom as well. 6
  7. 7. 20 Additionally, we recommend implementing a rewards program, such as a freguent buyer card, that will encourage customers to return and build a loyal relationship with Jamba Juice. D. Channels of Distribution It is important that Jamba Juice efficiently facilitates the distribution and movement of our products. Jamba Juice’s channel of distribution will include going through independent intermediaries at the local level to distribute our goods. The channel configuration that will be followed will start with the producer and then channel to the agent, the wholesaler, the retailer, and then finally to the consumer. Necessary ingredients will be supplied by local agents before hitting the retailer and consumers. Wholesalers will also be utilized for items such as Jamba cups and other utilities. We will be able to make sure that these agents provide us with the best smoothie ingredients so that our customers will have the highest quality products. The 11 Cs checklist will aid us for determining the appropriate approach to distribute our products. External determinants include customer characteristics, culture, and competition. Internal determinants include company objectives, character, capital, cost, coverage, control, continuity, and communication. E. Price Determination Jamba Juice’s product line does not differ from country to country or region to region. The per-unit costs are consistent regardless of location. As a result, we recommend Jamba Juice implements a standard worldwide pricing strategy. This uniform pricing method will take into consideration customers who are aware of price charges worldwide, as well as Jamba Juice’s product having little to no differentiation that could justify a price change between countries or regions. Additionally, once in the United Kingdom we plan on implementing a market pricing strategy. In consideration of the existing competition, Crussh smoothie maker, our final customer price must be based on our competition’s pricing, resulting in Jamba Juice adjusting both production and marketing to fit the price. We recommend this strategy due to Jamba Juice’s experience within the industry and the confidence that they will be able to attain a long product life cycle. F. Qualitative Statements as to the Pricing Strategy By using the standard worldwide pricing strategy Jamba Juice will price their products exactly the same in the United Kingdom as they do in the United States and the Bahamas. They will continue to charge roughly $4 per smoothie. This equates to € 3.25 per smoothie, which is the average cost of competitor Crussh’s smoothies. This enables Jamba Juice to acquire a competitive advantage from a price standpoint when relating to Crussh. The low price and convenience of Jamba Juice’s products positions them directly in line with the target market of citizens ages 15-34 years old. By implementing the standard worldwide pricing strategy Jamba Juice can achieve the long-term goal of becoming the market leader within four years of market entry. Consistent with Jamba Juices current methods of payment, they will continue to accept cash/Euro and credit card payments. 7
  8. 8. Work Cited 8
  9. 9. 1 1 Doing Business. (2010, January) United Kingdom. http://www.doingbusiness.org/ExploreEconomies/default.aspx?economyid=196 2 Euromonitor International. (2010, May) Consumer Lifestyles in the United Kingdom: Population. http://www.portal.euromonitor.com/Portal/Default.aspx 3 Hoovers. (2010, January) Jamba, Inc. http://premium.hoovers.com/subscribe/co/factsheet.xhtml?ID=ffffssyhsrcjjfryxh 4 Hoovers. (2010, January) Maui Wowi Franchising Inc. http://premium.hoovers.com/subscribe/co/factsheet.xhtml?ID=fffrfxchyfrjxshkfy 5 Hoovers. (2010, January) Smoothie King Franchises, Inc. http://premium.hoovers.com/subscribe/co/factsheet.xhtml?ID=fffrfcfthrkfrjtrcy 6 Hoovers. (2010, January) Planet Smoothie Franchises, LLC. http://premium.hoovers.com/subscribe/co/factsheet.xhtml?ID=fffrfcftjsysxxktcj 7 Crussh. (2010, June) Our Stores. http://www.crussh.com/store_listing.php 8 http://ir.jambajuice.com/phoenix.zhtml?c=192409&p=irol-irhome 9 http://multivu.prnewswire.com/mnr/jambajuice/43830/ 10 http://www.jambajuice.com/menu/index.html#/smoothies/ 11 http://www.environmentcalifornia.org/newsroom/oceans/oceans-news/environment-california-launches-styro-strike-at-jamba-juice 12 Hahn, Steve. "Santa Cruz Chapter | News." Surfrider Foundation : Santa Cruz Chapter. Web. 10 June 2010. <http://www.surfridersantacruz.org/news.html>. 13 "Marketing - Promotion - Push and Pull Strategy." Tutor2u | Economics | Business Studies | Politics | Sociology | History | Law | Marketing | Accounting | Business Strategy. Web. 10 June 2010. <http://tutor2u.net/business/marketing/promotion_pushpull.asp>. 14 "Internet Becomes UK’s Largest Advertising Medium, Ahead of TV | Alootechie." Alootechie | Whatever Matters in the Indian Online Industry. Web. 10 June 2010. <http://www.alootechie.com/content/internet-becomes-uk’s-largest-advertising-medium-ahead-tv>. 15 Web Usage Overtakes TV Viewing (2009). Retrieved May 27, 2010 from http://www.dtg.org.uk/news/news.php?id=1524 16 "UK Social Network Traffic Overtakes Search Engine Visits - The EMarketer Blog." Market Research & Statistics: Internet Marketing, Advertising & Demographics - EMarketer. Web. 10 June 2010. <http://www.emarketer.com/blog/index.php/uk-social-network-traffic-overtakes-search-engine-visits/>. 17 Web Usage Overtakes TV Viewing (2009). Retrieved May 27, 2010 from http://www.dtg.org.uk/news/news.php?id=1524 18 "Prime Time." Wikipedia, the Free Encyclopedia. Web. 10 June 2010. <http://en.wikipedia.org/wiki/Prime_time#United_Kingdom>. 19 "Jamba Juice Co. Celebrates 10 Years of Healthy Living;Jamba Blends a Unique Culture and Delicious Products Into a 300-StorePhenomenon. | North America United States from AllBusiness.com." Business Resources, Advice and Forms for Large and Small Businesses. Web. 10 June 2010. <http://www.allbusiness.com/food-beverage/restaurants-food-service-restaurants-fast/6416725-1.html>.
  10. 10. 20 http://www.walletpop.com/blog/2010/04/12/jamba-juice-coupon-for-buy-one-get-one-free/