Paul founded 120 years ago and is a market leader in France with more than 360 local branches and has spread over 20 countries worldwide. It’s a private sector company operated under HOLDER group which its 3 businesses are bread-making, pastry and restaurants.
Paul’s well known across its borders, and Egypt is one of its targeted countries as its further developing, nowadays.
Through our frequent visits to various spots in different cities in Egypt, we noticed how life style is developing encouragingly; we had to be certain about how liable our projected sales would be in this market. Accordingly we had assigned a marketing research to an international marketing research company ” TNS Global ” which had been for decades present in Egypt. By this we could ensure more accurate estimated results with first-rate standards.
TNS Global has provided us with the primary data through statistical research. We agreed upon that to follow the marketing research through the following steps.
a) Defining Problem and research objective. Our main goal is to ensure the feasibility of entering the Egyptian market, and thorough which means.
b) Developing the research plan. We needed to focus on adults and students as a primary target, athletes and healthy people as secondary target & children and seniors as tertiary target, without neglecting business targets as well. The research needed to cover the following information:
– The demographic, economic and lifestyle characteristic of these segments.
– Main market segments in Egyptian market
– Perceived price for our products by Egyptian consumer
– Suitable market entry
– Preferable sales approach
– Acceptance of the Egyptians for French products
-Egyptian consumer behavior and buying rhythm
– Suitable product features (size-packaging-colors-labeling)
– Competitors (local-international)
– Legal and social environment in Egypt
– Raw materials-labor cost and other production cost if we consider producing locally
– Investment rules in Egypt online commercial databases, we emphasize the primary data through our research to guarantee its validity and objective conformity.
– Our primary data collection will use survey research approach
c) Sampling plan. Random sample questionnaire is used to ask people, on our product and on the idea itself and how they react to it and how much acceptable for them it would be and such open-ended questions. To put hands on required information for research objective.
d) Implementing the research plan. TNS Global had feed us with implantation that includes collecting, processing, analyzing the information.
e) Interpreting and reporting the findings. Conclusions were sent to us in a vivid form that assured our idea about the viability and investment of our product in the Egyptian market.
Paul is preparing to launch one of its branches in Egypt, which is one of the big developing markets. Through direct investment to insure our control over the Egyptian market.
Despite the presence of bakeries other competitors, we can compete because our offering combines both high distinctive quality and suitable market price. We are targeting special segments in the consumers level, taking advantage of high quality baked goods, and distinctive foods and desserts.
The primary marketing objective of this research is to obtain first year Egyptian market share of 20 %. This primary financial objective is to achieve first year sales revenue of 20 million EGP, while keeping losses to less than 6 million EGP.
Current Market Situation
Paul founded 120 years ago and is a market leader in France with more than 360 local branches and have spread over 20 countries worldwide , and is about to enter the Egyptian market directly . The demand of the Egyptians to cafes with baked goods is increasing rapidly which lead to increase in competitive pressure. Thus dependence on high quality and a little over price according to other competitors will be obligatory to reach market share in this environment. Paul must carefully target specific market segments.
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Paul market consists of consumers of all ages from young children up to seniors which could be athletic , healthy or food admiring , who needs a quick pick and go or a short break in regular daily basis . In the first year we will focus on specific segments. Table A1 illustrates how Paul covers the needs of targeted consumers
Paul offers various high quality standard products indoor where customers can have ability to connect via the Internet while enjoying leisure or meeting or takeaway:
7 Plates specially for breakfast
6 Varieties of plates for a quick lunch
24 Different sandwiches with the variety of 7 different breads
10 Types of pies & pizzas
8 Grand classic bread
10 Pleasure bread
8 Light and healthy bread
4 Special meals for athletic and Healthy people
11 Different types of cakes and desserts
5 Type of ice creams
9 Viennoiseries and sweet pastries
6 Options of Crepe
36 Fresh juice , Hot and cold drinks
7 Take away boxes of 12 mini special desserts of one’s choice
Quick pick and go before classes
Small snacks on way back home or between courses
Hot and cold drinks
A little gathering between shopping, work or hangouts
A quick drink on busy days
Breakfast or lunch plates
Fresh juice or other drinks
Pies and pizzas
Buy goods for home or family
One of the 22 Bread
A box of mini desserts
Athletic and Healthy
Healthy low fat food
Food to fit in their daily diet
A grab before or after workout
One of 8 types of the healthy breads with minerals and vitamins
The unique collection of the healthy sandwiches
One of the meals for athletic people depending on their activity and their daily need
First year sales profits are expected to be 20 million EGP based on sales of Paul’s baked goods. During the second year we prepare to introduce Paul’s restaurant which will provide the following:
Big main dishes for Breakfast , Lunch & Dinner
More menu variety from each category of the previous provided products
Increased entry of cafes and bakeries has pressured competitors to continuously let prices down and add more products every day.
On the run
Starbucks: Is an international coffee shop from 30 years ago, offering hot and cold drinks, some desserts and very few sandwiches.
Costa café: is a 28 years old coffee shop which is internationally recognized, that offers few sandwiches, salads and desserts. But recently is facing financial struggles due to the increase of competitors and being not able to provide a bigger variety of products.
On the run : is the biggest competitor as its widely branded through almost 9000 stores worldwide , and one of the leading stores locally .It sells desserts , sandwiches, hot and cold drinks , salads , very few pizza.
The bakery : is one of the several shops which is considered to be a café and a bakery that sells some bread , sandwiches , few desserts , hot and cold drinks
Despite this strong competition, Paul can make out a distinct image and win recognition between these competitors and targeted segments. Our Unique way of baking bread is definite and doesn’t exist anywhere else , adding Paul’s large variety of products which have French background makes it unique in the local market , and never disregard 120 years experience.
Paul’s products will be sold through Paul’s stores and also through other stores in top 20 Egyptian markets. Among the most important partners that will help us distribute that already has been contacted are:
Super Markets. Metro market & Alfa market. Will allow Paul to present its product in their store.
Local bakeries. The baker, Bread basket. Will buy from Paul its unique bread variety to offer in their store.
School and University. American University Cairo , German School Cairo , British International School Cairo, German University Cairo & French University Egypt , Le Collège de la Mere de Dieu . Have agreed to deliver most of our sandwiches, desserts and beverages in their Cafeteria.
Fitness centers and sport clubs. World gym, Golds gym and Platinum gym, will sell our healthy sandwiches and athletic’s meals.
Variety. Our customer has a wide range of varieties through which they can explore and try and not getting used to only one product.
Price. Our products are in an affordable competing price according to the provided quality.
Quality. Paul signed with the Ministry of Health’s Terms of voluntary commitments nutritional progress under the Programme National Nutrition Santé on all its products. Paul becomes the first brand of bakery and catering to obtain this recognition.
Reputation. Paul has achieved an esteemed reputation throughout the years.
Unique. Paul provides many unique products in the Egyptian market which can allow it to have a definite image between competitors which would help it to have the targeted market share.
Brand Awareness. As a start up, Paul didn’t yet establish an image or brand name in the local market. Whereas “On the Run “and other competitors have a strong image and national brand recognition.
Culture Background. Most of our product comes from French background, thus it will take a little time for the Egyptian culture to explore and familiarize with it.
Paul can take advantage of two major market opportunities
Lack in market. Egyptian market lacks most of the products that Paul would introduce.
Increase demand. Egyptians demand to cafes with baked goods is growing rapidly.
Increased Competition. More bakeries and café’s are entering the Egyptian market. With hundreds of them, Paul must stress out clear differentiation.
Competitive pricing. Increased completion is pushing down the prices.
Duration. Paul’s products are all food based, thus it has to be sold during a short time period due to expiry and quality precautions.
Objectives and Issues
We have aggressive but reachable objectives during out first and second years of market entry.
First year Objective. During the entrance of Paul for the first year in the Egyptian market, we are targeting for 20% share of Egyptian market.
Second year Objective. We are aiming to achieve 30% of Egyptian market based on launching Paul restaurant and to achieve break even early in this period.
Paul’s marketing strategy mainly depends on positioning of product differentiation.
Primary consumer target. Adults and students which are considered upper to middle income individuals , who gathers around the tea-area in Paul and consumers more during their stay.
Secondary Consumer Target. Athletes and healthy people, due to their demand for healthy and energetic food which contains high vitamins and nutrients that Egyptians market lacks.
Tertiary Consumer Target. Children and seniors, as their needs would be little and met easily by mostly buying few products takeaway, like sweets, bread or desserts.
Primary business target. Is mid to large sized
Schools & Universities. As there are large amount of students who can benefit from its presence at their location especially during their break or between lectures as well as their ability to buy such product.
Fitness centers & Sport Clubs. Can profit from the existence of our products, pre or post workout, which could allow them to maintain their training and diet.
Through product differentiation, our product will position itself differently that other competitors.
We will focus on high quality, unique taste and price added value.
Paul will be offering all the products reviewed in the earlier product review section during the first year. We will establish Paul restaurant which will be offering, Soups, Side dishes, Side sauce, & big main dishes for Breakfast, Lunch & Dinner as well as more menu variety from each category of the previous provided products. Building Paul’s brand name that advocates high quality satisfaction is a crucial part of our strategy. The brand name “PAUL “will be printed on every bags and packaging to strengthen its entrance in the marketing promotion.
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Since Paul’s products are new to this market, and due to high competition between prices; Paul will introduce its products in a lower price during the first year until Paul’s restaurant is launched by the second year afterward an addition o 10% on Paul’s product will take place to compensate the costs being paid to establish the restaurant and to allow further expansion to cover more parts of Egypt.
Our First Year average prices will be as follows.
Breakfast Plates ( 14 – 35 LE )
Quick lunch Plates ( 3 5 -56 L.E )
Sandwiches with the varieties ( 24.5 – 42 L.E )
Pies & Pizzas ( 14 – 28 L.E )
Salads ( 24.5 – 38.5 L.E )
Grand classic breads ( 7- 10.5 L.E )
Pleasure breads ( 7- 35 L.E )
Light and healthy breads ( 10.5 – 35 L.E )
Athletic and Healthy meals ( 40 – 65 L.E )
Cakes and desserts ( 14- 28 L.E )
Ice creams ( 7- 14 L.E )
Viennoiseries and sweet pastries ( 5.6 – 14 L.E)
Crepes ( 10.5- 17.5 L.E )
Fresh Juices , Hot & cold drinks ( 7 – 21 L.E )
Take away boxes ( 70 L.E )
Paul’s channel strategy is to use its store location as a primary tool to distribute its products and to rely secondly on well known supermarkets, local bakeries, schools, universities, fitness centers and sport clubs , and lastly on online orders.
Marketing Communication Strategy
By combining and distributing all media messages simultaneously, we will fortify the brand name and the main points of product differentiation, especially out unique breads and desserts. Media campaign will be critical before and during product introduction. Therefore, advertising will appear on a rhythmic basis to maintain brand awareness and convey numerous differentiation messages. We would coordinate Public Relations efforts to develop Paul Brand name and support the differentiation message. We will as well offer limited time promotions, a listed item for customers that will buy a dessert, breads or other products will be offered without charge and further such promotions to attract market attention and favors purchasing.
Paul will provide free samples on first one month, for its business targets, as well as it would set special trades deals for retailers that would place volume orders. We would as well rent booths in grand malls to demonstrate our products for first two weeks, we also will offer discounts for purchases that exceeds 150 L.E.
Multimedia advertising campaign will take place; offers will be held with our partner radio stations, so that free gift coupons would be offered as a prize through them.
Paul will enter the Egyptian Market in September. The upcoming steps will summarize the action programs that will be taking place in the next six months.
We will begin with 400,000 L.E. sales promotion campaigns, to introduce the awareness of Paul to the local bakeries, schools and universities, fitness clubs and supermarket and also to generate excitement for Paul’s entry on October.
Paul will be launched. Internet, Radio, and print campaign will take place, directed towards our business and customer targets. The campaign will show the products we offer, their quality, and that they are new and unique in Egypt.
As internet , Radio, Print & multimedia campaigns persists , we will add consumer sales promotions , as offering promotions for large amount purchases , giving free item to consumers that buy desserts , breads and other products , as well as placing our booth in grand malls offering free samples.
We will distribute our products to schools, universities and supermarkets at this stage .Sales contest will be hold to offer prizes for sales person or one of our partners that offers our products, which had sold most out of our products.
Radio ads will put on celebrities taking about their experience trying Paul. Prints, television and internet ads will show celebrities eating a dessert from Paul.
We will offer out free coupons to our partner radio stations .we will place our products in local bakeries, fitness centers and sport clubs. Results of customer satisfaction survey will be counted and considered to make use of it in further promotions, and to review feedback of our products.
The first Year sales profit is projected to be 20 million EGP. We predict the first year loss of 6 million EGP as there would be marketing budget not less than 1 million EGP plus the start up expenses of factory building , machinery , and staff hiring and training.
We are arranging a Very tight control measure with strong monitoring method to ensure customer satisfaction. That will allow us to respond very quickly in correcting any problems that may arise.
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