Marketing Project - Deluxe Case Study (2009)


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Marketing Project 2009
Case Study of Deluxe Foods Ltd. (Globalization VS Localization)

Question as Stated Below:
Jessica Walters, marketing manager of Deluxe Foods, Ltd.—a Canadian company—is being urged to approve the creation of a separate marketing plan for Quebec. This would be a major policy change because Deluxe Foods’ international parent is trying to move toward a global strategy for the whole firm and Jessica has been supporting Canada-wide planning.

The Quebec market was in many ways different, she wasn’t sure how far the company should go in recognizing this fact. She knew that regional differences in food tastes and brand purchases existed not only in Quebec but in other parts of Canada as well. But people are people, after all, with far more similarities than differences, so a Canadian and eventually a global strategy makes some sense too.

Jessica Walters was afraid that giving special status to one region might conflict with top management’s objective of achieving standardization whenever possible—one global strategy for Canada, on the way to one worldwide global strategy. She was also worried about the long-term effect of such a policy change on costs, organizational structure, and brand image. Still, enough product managers had expressed their concern over the years about the Quebec market to make her wonder if she shouldn’t modify the current approach. Perhaps they could experiment with a few brands—and just in Quebec. She could cite the language difference as the reason for trying Quebec rather than any of the other provinces. But Walters realizes that any change of policy could be seen as the beginning of more change, and what would Minneapolis think? Could she explain it successfully there?

Evaluate Deluxe Foods, Ltd.’s present strategy. What should Jessica Walters do now? Explain

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Marketing Project - Deluxe Case Study (2009)

  1. 1. Introduction
  2. 2. Introduc)on  •  U.S.  based  consumer   packaged-­‐food   company   –  Headquartered  in   Toronto,  Canada.      •  Brand  preferences   throughout  Canada  
  3. 3. Deluxe  Food  •  $2.8  billion  worldwide  sales  •  $450  million  Canadian  sales  with  69%   contributed  from  Quebec  and  Ontario.  •  Introduced  6  new  products  annually  for  the   past  five  years.  
  4. 4. Management  Style  •  Jessica  Walters  as  markeQng  manager.  •  Monthly  meeQng  with  product  managers  to  discuss   developments  in  local  markets  that  might  affect   markeQng  plans.    •  Each  managers  are  free  to  make  suggesQon  but  final   approval  relies  on  Walters.  
  5. 5. Possible  Reasons  •  InflaQon  •  Threat  of  job  losses  due  to  poliQcal  reasons  •  Lack  of  managerial  Qme  and  money  spent  on   Quebec  market.   •  80%  of  Quebec  market  are  French  speaking  community.   •  GlobalizaQon  strategy  does  not  communicate  the  brand  image.  
  6. 6. Current  Problem  Declining  sales  growth  in  Quebec   for  the  past  two  years.  
  7. 7. SWOT Analysis
  8. 8. SWOT  Analysis  
  9. 9. SWOT  Analysis     Internal  Factor  •  Strengths   –  ConQnuously  introducing  new  products  (  at  least  6   new  products  introduced  every  year)   –  Increasing  sales  for  the  past  4  years   –  Ability  to  control  all  phases  of  the  food  business   from  Toronto  (monthly  meeQng  with  product   managers)   –  Wide  distribuQon  network  
  10. 10. SWOT  Analysis   Internal  Factor  •  Weaknesses   –  Inflexible  global  strategy  it  is  currently  adopQng   –  Straight  translaQon  may  not  be  able  to   communicate  the  same  brand  image   –  Lack  of  understanding  of  the  Quebec  market   –  Slow  respond  is  making  decision  between   localizaQon  and  globalizaQon  despite  concerns   from  product  managers  
  11. 11. SWOT  Analysis   External  Factor  •  OpportuniQes   –  Growth  opportunity  in  other  8  regions  in  Canada   –  Increase  spending  on  convenience  food  by   consumer   –  Greater  demand  for  healthier  food  (health   conscious  populaQon)   –  Healthier  frozen  breakfast   –  Expanding  their  channels  of  distribuQon  
  12. 12. SWOT  Analysis   External  Factor  •  Threats   –  Presence  of  compeQtors   –  InflaQon  (Country’s  economy)   –  The  threat  of  job  losses  to  poliQcs  
  13. 13. Compe)tors    •  Stouffer’s  by  NESTLE   –  Known  for  such  popular  fare     •  Meatloaf,  Salisbury,  steak,  lasagna,  macaroni  and  cheese,   and  ravioli.   –  Most  of  which  are  French  oriented  food   –  InteresQng  website  with  Recipes  suggesQon     –  Dinner  for  One  and  Dinner  for  Family   –  Dinner  reward  such  as  “Travel”,  “Electronics”  and   “Home”  
  14. 14. GlobalizationVS Localization
  15. 15. Current  Situa)on  •  Top  management  –  StandardizaQon  •  Product  Managers  –  LocalizaQon    DefiniQon  of  GlobalizaQon:  “…  Operates  with  resolute  constancy-­‐at  a  relaQve  low   cost-­‐as  if  the  enQre  world  (or  majority  enQQes  of  it)   were  a  single  enQty;  it  sells  the  same  thing  in  the  same   way  everywhere.”     Theodore  Levi,       Harvard  Business  Review  
  16. 16. Evalua)on  Table   According  to  3  Ps  •  3  Ps  of  InternaQonal  MarkeQng  Table:  
  17. 17. Evalua)on  Table  –  Actual   According  to  3  Ps  •  Deluxe  Company:  
  18. 18. Deluxe  Food  •  Weighted  raQngs  of  Quebec  &  Ontario  on  a  scale   of  10  
  19. 19. Choice  of  Marke)ng  Strategy  •  Average  of  5.8  in  the  evaluaQon  table  •  Adopt  GlocalizaQon  •  Especially  due  to  nature  of  product    DefiniQon  of  GlocalizaQon:  “Reconcile  the  need  for  consistency  of  the  presentaQon  of   the  brand  in  all  communicaQons  across  the  world,  as   well  as  the  need  for  consistency  of  the  presentaQon  of   brand  in  all  communicaQons  across  the  world”  
  20. 20. Suggested Marketing Mix Product
  21. 21. Product  • Staple  products     -­‐  RouQne  rather  than  habitual          • Actual  products     -­‐  Cake  mixes,  puddings,  pie  fillings,  pancakes,   prepared  foods,  and  frozen  dinners.    
  22. 22. Core  Product    •  Taste   –  Do  not  enjoy  cooking  but  eaQng    •  NutriQon    -­‐  Part  of  their  health  and  wellness    •  Convenience        -­‐  From  store  to  home  
  23. 23. Branding  •  Brand  name  -­‐  “Deluxe  Food”      Short  &  simple  §  §   SuggesQve  of  product  benefits  §   Easy  to  spell  and  read     §   Adaptable  to  packaging/    §   Easy  to  recognize  and  remem labeling  needs    ber   §   No  undesirable  imagery  §   Easy  to  pronounce     §   Always  Qmely  §   Can  be  pronounced  in  only  on §   Adaptable  to  any      adverQsing  e  way   medium  §   Can  be  pronounced  in  all  lang § Legally  available  for  use    uage  
  24. 24. •  Logo  –  5  Main  Steps   – Visibility   – Applica)on   – Simplicity   – Color   – Timelessness  
  25. 25. •  Logo   –  Warm  colors     •  Red  and  orange  used     –  Classy  font     –  Professional  image   •  Side  view  of  chef    
  26. 26. •  Slogan     –  CompeQQve  advantage  of  providing  good  quality   –  Short  and  direct  
  27. 27. Packaging  •  ApracQve  packaging   –  NutriQon  label   –  Print  Materials  and  RelaQonships  with  Health   FoundaQons   Double  Chocolate   Muffin  Mix  
  28. 28. Suggested Marketing Mix Price
  29. 29. Price  •  Value-­‐based  pricing  •  Value-­‐opQmized  pricing  
  30. 30. Suggested Marketing Mix Place
  31. 31. Place  •  Geographical  market      Canada  •  LocalizaQon  market  [Quebec]   –  Key  to  ability  to  apract  customers   –  Major  impact  on  retailer’s  profits    
  32. 32. Site  Loca)on  •  Major  supermarkets    •  “Mom  &  Pop”  stores   –  Stocked  a  higher  proporQon  of  shelf  space  for   Deluxe  foods  in  Ontario   –  Fast  disappearing  in  Canada  except  Quebec    
  33. 33. Increase  of  Shelf  Space   Availability  •  Extension  of  ExisQng  Shelf  Space   –  Increase  of  shelf  space  in  supermarkets   –  Placement  of  products  on  the  middle  shelves    (Eye-­‐level  view)  
  34. 34. •  ApracQve  Portable  Stand   -­‐  ApracQve  yet  portable  new  shelf  stand   -­‐  Creates  specialty  and  public  awareness      Designated  tailored  shelf  space        Beper  “retail  environment”        “Retail  environment"  is  meant  to  be  used  interchangeably   with  retail  store,  and  generally  refers  to  a  business  or   establishment  that  offers  consumer  products  for  sale.      
  35. 35. Increase  Distribu)on   Channels  •  Convenience  Stores   –  Placed  products  in  well-­‐established  line  of   convenience  stores      Examples:  “AlimentaQon  Couche-­‐Tard  Inc”,  “Beckers  Milk’   and  “Quickie  Mart”  or  the  world’s  largest  convenience   retailer,  “7-­‐Eleven”.  
  36. 36. •  Specialty  Store:  Deluxe  Gourmet  Store   -­‐  Direct  distribuQon   -­‐  Superior  value  to  selected  target  market      Example:  ‘Deluxe  specialty  gourmet  store’    ü   Cater  and  sell  Deluxe  Food  products  ü   Niche  market  and  a  brand  new  experience  
  37. 37. ‘Deluxe  specialty  gourmet  store’    ü Quality  and  service  ü Feed  back  and  suggesFons  ü Future  changes  and  development    ü CreaFng  more  value  than  compeFtors  
  38. 38. Suggested Marketing Mix Promotion
  39. 39. Promo)on  •  Current  Strategy   –  Standardized  AdverQsing  method   –  Quebec:  Straight  translaQon  from  English  to   French  •  May  be  IneffecQve   –  Context  of  messages  may  not  project  brand   image  in  Deluxe   –  Maximum  exposure  is  needed  to  heavy   weightage    
  40. 40. Recommended  Strategies   “Push”  Strategy  •  Push  Strategy   –  AcQve  engagement  to  push  product  to   consumers   –  Great  Strategy  to  introduce  product   –  Push-­‐markeQng  makes  your  brand  pervasive  and   ubiquitous   •  “Pushing”  product  to  let  consumer  try  out  
  41. 41. Media  Adver)sing  •  Media  AdverQsing   –  Raise  mass  awareness   –  Through  different  channels  such  as:    -­‐  Radio,  TV,  magazines,  and  even  trains    
  42. 42. •  Possible  outlook  of  Deluxe’s  Campaign  
  43. 43. Media  Adver)sing  •  Sponsoring  of  TV  shows   –  Especially  in  Quebec   •  In  this  region,  TV  talk  shows  that  feature  topical   issues  and  discussed  over  dining  table   •  “Joie  de  vivants”  –  Quebecers  “enjoy  life”   •  “Bon  vivants”  –  Enjoy  talking,  eaQng  and  socializing  
  44. 44. Recommended  Strategies   “Pull”  Strategy  •  Pull  Strategy   –  Consumers  are  apracted  by  the  product  of   company  and  draws  themselves  towards   company   –  This  strategy  encourages  customer  to  seek   company  out  
  45. 45. Websites     Products    >  Baking  Mix    >  Muffin  Mix     Home        >>  Double  Chocolate  Muffin  Mix   Products   About  Us   New!   Ac)vi)es   Products   New!   Whole  wheat  flour  and  high-­‐ Promo)ons   Ac)vi)es   Products   fiber  cereal  are  the  goodies  Recipe  &  Ac)vi)es   Promo)ons   Contact  us   Do u b le  C tucked  in  a  chocolate-­‐lovers   Muffi hocolate   sweet  muffin.   Deluxe Food n  Mix Promo)ons   Contact  us     Contact  us   Double  Chocolate   Prep  Time:    15  min     Muffin  Mix   Search:   Start  to  Finish:  35  min     GO   Nourriture dse luxe Makes:      12  muffins     Nutri)onal  value   GO  
  46. 46. •  Websites   –  Easy  NavigaQon   •  Provides  all  informaQon   –  NutriQonal  informaQon,  Company  history  and  etc.   •  Warm  color  palepe  that  is  consistent  with  brand   image   •  Main  categories  and  search  bar  available  on  the  lex   panel   •  AcQviQes  and  recipes  to  encourage  repeated  visits  
  47. 47. Glocaliza)on  in  Promo)on  •  Localize  adverQsing  and  promoQon,  but  have   a  consistent  brand  image   –  Localized  AdverQsing   •  Use  of  words   –  No  direct  TranslaQon   –  Using  “play  of  words”  -­‐  “Jeax  de  mots”   –  Appeals  to  Quebecerss’  love  for  language  and  sense  of   humor   •  Careful  choice  of  Color  palepes   –  Quebecers  prefer  bright  colors  
  48. 48. Conclusion:It is recommended that applies Glocalizaion