Marketing plan of ice cream company Baskin Robbins Target market
Market segmentation is the process of identifying the variety of different groups of consumers or users within a particular market who could be targeted with separate products or marketing programs. (Craft, 1994, p.1)
With regard to the ice cream industry, it could be segmented on certain bases such as taste and price. Whilst certain individuals would prefer high quality ice cream made with real sugar and cream because of its taste, others would simply not be able to distinguish the difference in quality and would buy primarily based on price and availability.
We have identified that Baskin Robbins uses certain main segmentation bases for dividing their market, namely demographic and psychographic characteristics. Under demographic segmentation, they focus on the income bracket of consumers. Their products are mainly aimed at the affluent with higher disposable income to spend on frivolous luxuries such as premium ice cream. Also probably the most important type of segmentation bases which we consider is the psychographic segmentation. To be attracted to consuming a premium ice cream, consumers need to be part of a particular lifestyle segment. They would be among those who enjoy the luxury and indulgence associated with the brand.
Using these segmentation means we have conducted a research and identified that, Baskin Robbins has narrowed down its business to cater to specifically two main target markets. Whilst Baskin Robbins portrays the image of targeting all age groups, our research confirmed that their main target market would be higher middle and higher upper income group of people, basically the urban professionals and families with toddlers.
And our research identified that young individuals are more involved in socializing mainly in Colombo urban areas. Hence the current location placed in close proximity to two main Universities and schools in one of Colombo’s main streets (Galle Road) in a high foot traffic area of Colombo itself (Kolpity). Therefor the secondary target group of Baskin Robbins could be categorized as teenagers, young adults and students who live in the urban area of Colombo.
Primary Target Market
Higher middle and higher upper income group
The primary target market of Baskin Robbins is comprised of higher middle (Rs. 150 000 to 200 000) and higher upper (Rs. 200 000 above) income professionals and families with toddlers. This market would possess a high disposable income percentage. The lifestyle of such individuals would be high value on family time spent, high focus on child-centered activities, high child centered activities and they would be individuals who associate a product with brand name, quality over price, hence having ice cream at Baskin Robbins would be aligned with their social class. Also the premium loyalty which is associated with Baskin Robbins, these individuals with a high profile status class would be subject to a strong attachment to Baskin Robbins and develop a sense of belonging, which is then in turn passed along to the children. As a result, the families are adjudged profitable high volume customers.
Secondary Target Market
Teenagers, young adults and students
The secondary segment of Baskin Robbins target market is composed of teenagers, young adults and students (School and university) within the Colombo city suburbs consisting of both genders and all ethnicities ranging from the ages of 18-24 and 25-30. These individuals would be having active social lives, and it will be an important aspect as per our research suggests that this segment of the market enjoys socializing, leisure and entertainment mainly in Colombo urban areas. While most of this demographic appear to be similar, college students would be the prime segment to focus on. Most college students whilst mostly depending on their parents also have part time jobs and usually receive an average of Rs. 25 000 monthly. Hence these students could be viewed as marginally profitable low to high volume customers with latent to premium loyalty as they would be spending most of their income on social activities and entertainment. According to our research it was made aware that social class and social life is considered a high priority to this segment of the market. Hence they would feel the need to create a strong relationship or attachment to Baskin Robbins, as it is a premium product and a hot spot for this segment to satisfy their self-esteem needs. Also this market would follow up the potential for positive word of mouth and due to the fact that peer influence is high for this segment of the market, it would undoubtedly result in the growth of the customer base of Baskin Robbins.
According to the outcome of the research it was made evident that customers were not that pleased or attracted to the current ambiance at Baskin Robbins. It is the quality of the ambiance of the outlet that attracts the customers to enter the outlet and purchase the product. Poor ambiance can result in declining of sales no matter how reputed the brand name is or how good the product is.
Hence we propose that the ambiance of Baskin Robbins Colombo to improve the ambiance firstly by creating a good first impression. Although very distinguished in the color theme, the store signage at the moment is not very visible for vehicles which are moving on Galle Road until close range. It needs to create an impact, hence we suggest the “BR” signage to increase in size relatively and displayed in a manner which oncoming traffic could view it from a distance.
With regard to the inner store ambiance Baskin Robbins needs to work on making the store more inviting and comfortable. Their objective should be to keep the customers as long as possible. As the longer the customer tends to linger at the store the more they would usually spend. Hence we suggest that the iron chairs which tend to get cold due to the inside air conditioning be replaced with more comfortable chairs. Also the store atmosphere could be made more welcoming if the images of the models used wasn’t primarily European or western and add a bit of Asian flavor as well. Also more attractive decor should be utilized in store.
Our research suggests that people enjoy having some form of soft music in the background of the place they use for socializing. Hence we suggest Baskin Robbins use southing/peppy background music within the store (As the Brand requires). Music themes could be set according to seasons or occasions, such as Christmas, Easter or New Year
Also our research has shown that 70% of the customer purchase decisions are made in store, and are largely influenced by the arrangement of the product or merchandize, the in store signage, the decor and even the layout of the product pricing displays. The store signage at Baskin Robbins at present is very dull and not out there loud and clear. should convey the retailer’s message loud and clear. It should give out the information the customer is looking for immediately and direct them to the price and product range. Hence we suggest the product and price display boards at Baskin Robbins to be more clearly and creatively put forward separated by different product category so that the customer is able to make a more informative decision.
Also add-ons such as store related kiosks are which Baskin Robbins uses for special occasions such as birthdays, should be made more exclusive and lighting and displays need to be changed to make that particular section of the store more prominent or vibrant than the rest of the store.
However the aroma at Baskin Robbins could be said is excellent, as once you enter the outlet you would get the sensuous smell out fresh ice cream and it entices you to purchase the product. And our research suggests that the ice cream smell even carries as the customer leaves the outlet, which would in turn attract more customers due to the attraction. This is known as ‘Aromatherapy’, which is the use of scents and smell to attract the customer and impact on their purchase by praying on their sensory system, primarily smell. This technique would be suitable as Baskin Robbins ice cream is considered a low involvement product to the relevant target segment and is more often than not done on impulse.
The Pricing Strategy
Baskin Robbins being an international brand which is positioned as a premium product adopts a Price Skimming method whilst they concentrate on their Colombo metropolitan market. This is possible due to the fact that they have a unique, high quality product as well as they cater to a less price sensitive market.
This means that Baskin Robbins has estimated its unit price to be positioned in the minds of the consumers as a premium product. Hence consumers would be willing to pay that high price in return for quality. This is usually seen amongst segments which are social class conscious. At present a normal ice cream scoop is priced at Rs. 210 and even with this high price markup we see that Baskin Robbins within the first year of launch in Sri Lanka has managed to hold up a steady margin of %.
We propose that the regular, loyal customers be awarded special attractive packages designed to give them a sense of belonging and thereby retaining the customer further.
Sales and Distribution
Distribution channel could be defined as the pipeline which is used to flow goods and services from the vendor to the consumer. (“Business Dictionary, Distribution Channel”, n.d.)
Distribution of ice cream in Sri Lanka is primarily done using a wholesaler or retailer. Most domestic brands conduct regional operations in close proximity to their main markets. And according to our research they possess either leased or owned cold storage facilities in the main suburbs of Colombo.
The method of distribution or place adopted by Baskin Robbins is a high foot traffic area in the Colombo suburb of Kolpity, which is based on one of Colombo’s busiest roads. (Galle Road) And the fact that it is uniquely placed in close proximity to several universities and schools as well as several business organizations has made it a high foot fall region. Hence since the trend or behavior pattern of the target market of Baskin Robbins is concerned of social class they would want to be associated and be seen in the main Baskin Robbins outlet by their peers.
Our consultancy recommends Baskin Robbins to embark on opening small outlets in major hotels in Sri Lanka, such as Cinemon Hotel Chain, Hilton Hotel, Galle Face Hotel etc. and even the high end consumer malls such as, Crescat Boulevard and Odel, all places associated with the social class of the target market of Baskin Robbins which pursue social status symbols, and would therefor potentially want to associate Baskin Robbins to represent their social class.
Advertising and Promotions
Baskin Robbins at present is only available in one main outlet in the city of Colombo. Therefore adopting a mass media advertising technique would not be suitable. It could be advised that a more vigorous online and Facebook advertising should be done to build up its online customer community.
Also our consultancy suggests Baskin Robbins to adopt a photo wall in a highlighted prominent section of the outlet inner to add the “Face of the Month” promotion, where one lucky boy and girl would be picked randomly and get the opportunity to get his/her photograph taken and attached on the “Baskin Robbins Face of the Month Hall of Fame”. This would indeed give a sense of belonging to the customer who enters the outlet.
We also recommend the passing out of a pocket menu for Baskin Robbins named, “Ice Cream in your pocket” where customers would be given out a small catalog/menu of the latest flavors, prices and promotions of the month.
In addition we believe that Baskin Robbins should introduce its range of coffee and beverage line in addition to the milkshakes made available at the moment. We believe that introducing their signature beverage products such as the Cappuccino Blast, Fruit Blast would be a huge consumer attracter as our research suggests that the market segmentation which Baskin Robbins is focusing on prefers to use their leisure time socializing, hence providing the customers with not only ice cream and milkshakes, but introducing a range of coffee and other fruit and dairy based beverages by Baskin Robbins would be an added attraction to the consumer.
The ‘Birthday Club’ promotion adopted in US could be also adopted here as to give special benefits, coupons and other promotional offers for the online registered customers and other frequent in store customers on their birthdays. (“Baskin Robbins, Birthday Club”, n.d.)
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