C 1 Ben & Jerry - Grade: 10 PDF

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Ben and jerry report...

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Ben & Jerry's Homemade Ice Cream Inc: A Period of Transition

Group 7 Akshita Bhatnagar PGP/22/118 Kaustubh Jagtap

PGP/22/137

Heena Yadav

PGP/22/133

Latashri

FPM/12/26/S

Nuthan Kumar

PGP/22/136

Sandeep Yadav

FPM/12/27/S

Nikhil Gupta

PGP/22/149

Ben & Jerry's Homemade Ice Cream Inc: A Period of Transition Ben & Jerry's (B&J) Homemade Ice Cream Inc is one of the major players in the super premium ice-cream market in the USA. It currently holds a 42% market share. Its main characteristics include high-quality product, social image, marketing strategy, good financial situation, and high employee satisfaction. Due to its high cost of sale, poor policies towards distributors and suppliers it is facing the risk of falling behind the strong competition. A various number of factors define the company’s current competitive position in the market. B&J finds itself in a low growth market and a highly competitive market. Haagen–Dazs the company’s biggest competitor – and B&J have been constantly towards a major market share in the super premium ice-cream market. Increase in sales in 1994 was due to the success of the newly introduced “Smooth, No chunks,” 3.7% price increase of pints and it costed 6 million to advertise that product. In 1995 the stockholder’s equity reduced and debt increased by 1.8 times. Market segment of super premium segment is stagnant due to health consciousness; premium segment had growth due to 9.9 % increase in ice sorbets and 7.8% growth in sherbets. There has been a slowdown in the sales in the high-fat segment of the icecream market due to increasing health awareness in the population. As an advisor to Bob Holland, based on case analysis we would recommend to adopt ways in which to expand total market demand and at a similar time defend its current market share through smart defensive and offensive measures. B&J should focus on its strategic internal and external changes. The long-term strategy should be to become a market leader using its competencies in R&D, strong brand image and new production plant. While making an attempt to expand total market share, B&J should increase their marketing expenditure, maintain product quality flavours. Here are some proposed feasible solution, in line with the company mission 1.

Reshaping internal structure

2.

Restructuring of distribution

3.

Concentration on key markets

Reshaping internal structure B&J should introduce all members of product teams from the different entities of the organization; this would integrate the activities involved in developing a new product. Cross functional teamwork could speed up the process and enable it to introduce new products faster. B&J has always maintained a R&D department dedicated to the development of unconventional and cutting-edge flavour, which acts as an advantage and B&J should maintain this advantage. B&J should keep its social mission but needs to introduce a new sales & marketing specialist, to centralise their marketing activities. To target this group of people, the focus of the advertising strategy should be promoting its low and non-fat products. B&J needs to redesign its advertising strategy such as adjusting the design of its packaging to match its current consumers’ tastes. Restructuring of distribution Although B&J has made some attempts to open new distribution channels, those efforts are not enough. Making the product available to the customer at these new locations is essential e.g. Restaurants, Internet, Take-out/to-go ice-cream stands. The availability of the product in these locations could be achieved by co-operating both with large restaurant chains as well as

licensing with small outlets. We propose restructuring the contract with Dreyer's, which is B&J’s exclusive distributor, to allow spreading the distribution among various distributors. Concentration on key markets B&J target group focuses on age group of 25-40 years old consumers in the upper-middle class sector without children. This target group has more spare money to spend it on luxury goods like B&J. B&J should keep its target market but attract buyers who are unaware of the product or who are not willing because of certain features. Also, more emphasis should be put on commercial advertising....