Just Us! Coffee Roaster specialises in supplying “Fair Trade fresh-roasted coffee beans, teas, and chocolates to Canadian retailers and consumers” (Just Us! Cafe, 2012). The company must use reliable channels to communicate with its customers. Constant provisions of fresh and undamaged coffee present serious challenges to the company. Marketing environment has become complex for the company. As a result, there is a widening gap for the company in relation to marketing activities. However, the solution lies in the Internet and costs of communication. This report looks at the marketing planning of Just Us! Coffee Roaster in the challenging and dynamic marketing environment.
Internal and external challenges confronting Just Us!
Fresh coffee: customers and consumers know the company for fresh and undamaged coffee and deliveries on demand. The demand for fresh-roasted coffee beans, teas, and chocolates is on the rise in Canada. This is due to growing numbers of coffee consumers who have also created demands for other varieties.
Growing customer bases: the retail market has expanded over the last decade. There are also increasing channels of distributions that Just Us! Café has continued to exploit across Canada. The company relies on direct distribution, grocery stores, and mass merchandise among others. The company also uses fast-food chains.
Vending: Just Us! Café provides a strategic location for its customers to gain access to coffee and other products with ease. Just Us! Café relies on “the continued growth of coffee-themed restaurants, which provide branding and opportunities for the coffee industry” (NAICS, 2010).
Premium coffee products: the company offers premium products as customers demand changes to high-quality coffee products. The company provides over ten varieties of coffee products from various parts of the world. These varieties have captured the attention of many consumers. The company also offers tea, sugar, and chocolate.
Location: the company has strategic locations such as Grand Pre Coffeehouse. This place enables the company to attract tourists who also come to tour the area. Wolfville Coffeehouse has a strategic location at the centre of Wolfville city in a Cinema complex to attract customers from the cinema. Spring Garden Coffee also targets people who visit the public garden. Barrington Street Coffeehouse targets customs in Halifax from nearby offices (Just Us! Café, 2012).
Industry knowledge: the company has an extensive knowledge base in the global coffee markets.
Meeting specific needs of growing customers: the company experiences challenges in meeting the diverse demands of a growing customer base. According to the North American Industrial Classification System (NAICS) 31192, “changing consumer demographics has resulted in changing consumer tastes and increasing demands for healthy products” (NAICS, 2010). Consumers rely on numerous studies, which identify the health benefits of taking coffee to demand new products.
Seasonal supply: coffee remains a seasonal crop. As a result, the company may experience difficulties in maintaining supply from a specific region. In addition, climate change has also affected its sources like Rwanda. The company’s outlets in public gardens may only experience sales increment during holidays.
Similar products in the market: the company competes against similar coffee products in the Canadian coffee industry. Thus, differentiation becomes a problem for Just Us! Café. There is also pressure from substitute products.
Technology: the company has experienced rapid growth in the past. As a result, its customers have become widely distributed across the country. The company experienced challenges in making overnight deliveries nationwide. However, Just Us! Café was able to solve this problem using Purolator’s software to make such deliveries in time. Consequently, the company have been able to deliver fresh coffee as soon as they receive the order and avoid incorrect shipment. This has enabled Just Us! Café to gain access to emerging markets (Adcock and Halborg, 2004).
Pricing: the company offers ranges of roasted coffee products from different parts of the world. These varieties have various prices. The increasing demand has also created opportunities for better pricing of coffee products for the company. At the same time, the company has found ways of providing value-added services for competitive prices in the coffee industry.
Target markets: Just Us! Café has diverse consumers with growing demands for quality products. This has created opportunities for the company to exploit new markets, existing markets, and introduce new products to different segments of the market. The company’s strategic outlets have also enabled it to serve diverse customers in the Canadian market (Berry and Doug, 2001).
Fair Trade promotion: the company has been able to exploit Fair Trade promotion as its key marketing tool in the competitive coffee industry. The company works with marginalized coffee farmers across the world. This acts as corporate social responsibility (CSR) as well as a strong marketing tool in the international coffee markets.
This also implies that Just Us! Café appeals to the taste of various consumers using coffee from different parts of the world. This is an innovative approach in creating a niche market for its coffee products, and may explain why Just Us! Café has dozens of coffees products.
Delivery: the company faces several challenges in delivery orders. First, the company has to deal with incorrect shipments, which may reach the wrong customer. Second, shipment processes may also cause damages to fresh roasted coffee products resulting in losses to the company.
Product quality and damages: customers always want fresh coffee. Therefore, the freshness of coffee remains a significant source of threat to the company. Coffee has to maintain its freshness throughout the supply chain until it reaches the consumer. This is a challenge to the company.
Turnaround time: the need for fresh deliveries makes turnaround time so crucial for Just Us! Café. Therefore, any slightest delay can result in losing a customer. In addition, if customers run out of supply, they will buy from competitors. Therefore, coffee must always be available in Just Us! Café outlets to serve customers.
Customers: customers are also threats to the company. For instance, coffee customers do not want a delay in delivery, incorrect delivery and damaged beans. They can ruin the business from these perspectives (Palmer, 2004).
Flexible shipping opportunities: the growing customer base from different parts of the country means Just Us! Café must find flexible shipping partners. However, this may be difficult to achieve for countrywide deliveries.
Existing and new entrants: there is stiff competition in the coffee industry. There are multinational firms as well as new entrants targeting the industry. These create competition for Just Us! Café and are likely to erode its market share (Pride and Ferrell, 2003).
From the SWOT analysis, we can see that Just Us! Café has to deal with constant threats and weaknesses, which affect its operation. However, the industry is growing and creating many opportunities for the company.
|Strength ||Opportunities |
|Weaknesses ||Threats |
The PESTEL analysis
The company’s activities suffered the effects of the global financial crisis of 2008. In addition, the company suppliers from Italy also had to deal with the euro crisis. Such prevailing economic conditions affect consumers’ behaviours in terms of consumption and purchasing patterns (Solomon, 2006).
The fluctuating international prices of “green coffee beans also affect the profitability of the company” (NAICS, 2010).
Just Us! Café is under pressure to “maintain profitability by enhancing productivity and cutting costs” (NAICS, 2010).
Changes in exchange rates also have significant effects on the company’s earnings and profits. However, these market conditions are difficult to predict (Kotler et al, 2005). Therefore, Just Us! Café must formulate strategies to mitigate them.
Just Us! Café gets most of its green coffee beans from the volatile Rwanda regions of the marginalised communities. The guerrilla activities in Rwanda present threats to sources of Just Us! Café green coffee beans.
The company gets its coffee beans from various parts of the world. These countries have different taxes on coffee exports.
There are a number of regulatory Acts affecting the company. First, the company must comply with the Food and Drugs Act of Canada with reference to health, quality, content, and labelling. This creates confidence among consumers. Second, there is also Consumer Packaging and Labelling Act that requires products to have accurate information about their contents. Third, Just Us! Café must also comply with the Mandatory Nutrition Labelling (NAICS, 2010).
These regulatory environments are good for company business. However, compliance with them may be expensive.
International trade treaties also affect the regulatory environment of the coffee industry. These regulations are diverse and present challenges to companies because they lack harmonisation.
Coffee consumption revolves around social activities of its consumers. However, the growing demands of healthy products based on information from health studies present serious challenges to Just Us! Café in developing new products to match the demands of health-conscious consumers.
Canada classifies coffee and teas as fairly traded commodities. There is an emerging market for customers who have interests in “ethics of traditional coffee product and harvesting practices in developing countries” (NAICS, 2010). These consumers are willing to pay extra for premium coffee products. Therefore, Just Us! Café must meet the needs of such market segments.
Technological changes have disrupted marketing activities in many industries (McConnell, Brue and Barbiero, 2002). Before Just Us! Café adopted Purolator’s software for its delivery management, the company had experienced difficulties in meeting overnight deliveries, controlling incorrect shipment, and making just-in-time deliveries. However, Purolator changed its business activities.
With the growing customers’ base and emerging demands, the company may find it hard to manage its operation with Purolator application. This calls for aligning IT strategies with business strategies. The company will face serious challenges if it fails to incorporate customer relationship management with other IT applications in its operation management.
The company has no legal challenges at the moment.
Global warming has affected coffee production across the world. Coffee yields and quality have declined over time.
Just Us! Café must comply with the Canadian Environmental Protection Act and the Canadian Environmental Assessment Act.
The company must also comply with the waste reduction policies from packaging materials. Just Us! Café uses packaging materials for branding purposes and increasing product attractiveness. However, minimising packaging can help the company protect the environment and save costs. The challenge is whether Just Us! Café is willing to undertake such initiatives.
Just Us! Café faces strong competition from established multinational firms, which offer similar products like coffee and tea. Multinational corporations have focused on areas where they possess competitive advantage over domestic coffee shops. This has been through production flexibility and the use of strong brand names. These firms also rely on marketing strategies of their parent companies. They also have mainstream products for high-end consumers as well as value-added products for other segments of the market. Some of these multinational firms include Nestle, Kraft Coffee, Starbuck, and McDonald’s among others (Solomon, Marshall and Stuart, 2009).
Still, domestic coffee firms like Just Us! Café must remain relevant amidst such competition. Just Us! Café has been able to expand its market share using specialty coffee products from various parts of the world. These are mainly Fairly Traded coffee and tea products.
To what extent do these challenges threaten the future of the company?
Customers may be come risky to Just Us! Café due to services and products they receive. For instance, the company may lose customers who want coffee products associated with the health benefits or specialty market coffee and tea traded under Fair Trade provisions.
Just Us! Café has also noted that customers bought from competitors if it did not have supplies in its outlets. They have observed that coffee customers did not want mistakes and damaged products in their orders.
Just Us! Café has a growing market share. This means the company will have a challenge managing its relationship with customers if there is no appropriate customer management system.
Technology has provided opportunities for companies to reach their markets. However, other companies, especially multinational firms have turned to technology for creating competitive advantage. This implies that firms, which do not embrace technology in marketing, shall not have strategic advantages over their competitors. Through the Internet, customers can know coffee outlets in their localities, costs, mode of deliveries, and quality of services and products.
Just Us! Café has both direct and indirect competitors. The main aims of these competitors are to acquire market shares and rapid growth by attracting customers from other companies. Therefore, competitors have aggressive techniques for gaining customers from other companies. These strategies may include low prices, incentives, and free samples to encourage customers switch to them. Thus, Just Us! Café must react to such threats before it loses customers to competitors.
The competitive marketing strategy adopted by Just Us! Café
The company uses a number of competitive marketing strategies to achieve competitive advantage. Some of these strategies include broad differentiation strategies, low-cost provider strategy, customer differentiation, and professional services among others (Porter, 1998).
Marketing strategies should change with time as competition. Just Us! Café should invest and adopt the latest technologies, multimedia and communication resources to connect with their customers. At the same time, marketing strategies should focus on managing crisis as it helps the company to identify how to cope with losses, rising costs, and even negative publicity (Pride and Ferrell, 2003).
Broad differentiation strategies
Just Us! Café strives to achieve a competitive advantage over its rivals by incorporating several coffee products, tea, sugar, and chocolate. First, the company has been able to create premium products for premium prices. The growing consumer demands have led Just Us! Café to add many premium products to its range of existing coffee products. These include ready-to-drink products and other products for customers who are conscious about health benefit of taking coffee. The company has been able to expand to cater for retail customers. Just Us! Café has created coffee-themed restaurants in strategic locations to offer competitive advantages for its premium products. This approach has played a significant role in creating market share for the company. Coffee products like “single serve formats, premium blends, and flavoured products have generated additional consumer interest in consumption of coffee products” (NAICS, 2010).
The company has also been able to increase its unit sales due to several coffee products from different parts of the world. These products appeal to various segments of the market based on their preferences. Such differentiating features have won over additional consumers for the company. At the same time, broad varieties of Just Us! Café products have also created customers loyalty to the company. Customers identify with companies due to various products and features companies offer (Solomon, 2006).
The differentiation strategy has worked for Just Us! Café because of diverse consumer preferences. This is because the company can produce appealing coffee products to various segments of its customer base. At the same time, Just Us! Café rivals are also pursuing the same approach. The company has been able to survive competition because competitors cannot easily match its wide varieties of coffee and tea products. This strategy is also cost-effective for the company, and it does not erode profitability (Brassington and Pettitt, 2005).
The company has also embarked on professional packaging so that customers receive their orders intact. This enhances labelling and maintenance of products quality. Standard packaging approach has enabled the company to save on packaging costs. Thus, reducing costs to consumers. The principle of Fair Trade requires that the company saves costs by ensuring appropriate packaging of all its products from countries of origin. Therefore, the company only concentrates on unit packaging for consumer needs. This has enabled it to keep the shipping cost low. According to Just Us! Café, professional packaging and low costs are strategies for developing effective customer relationship (Porter, 1998).
The company has also outsourced its delivery service to Purolator. This strategy has ensured that Just Us! Café saves costs. Customers also get their orders delivered in good condition and time. Purolator has ensured that customers receive correct orders and in time. This is particularly important to the company’s differentiation approach because of the nature of products. Customers want fresh coffee, and the delivery company can deliver them in time. In order to avoid losses due to incorrect deliveries, the delivery company has been able to reroute or return such products to the right customer or to the company. Just Us! Café strives to establish strong customers’ base by differentiation and provisions of excellence services than its revivals. All coffee firms can provide coffee products to customers. However, Just Us! Café has differentiated itself as customer-focused. It has been able to achieve strategic advantage through deliveries and customer supports. These are what distinguish Just Us! Café from its rivals.
Low-cost provider strategy
Just Us! Café believes in minimal profits in the coffee business. This is because the company uses a low-cost provider strategy as it strives to achieve low-cost advantage over its competitors. This implies that the company must engage in cost-effective processes in its value chain activities.
Just Us! Café promotes Fair Trade products. Coffee and tea products are part of Fair Trade products in Canada since 1988. This creates equity among all stakeholders in the value chain. Thus, cost-effective strategies and fair pricing start from the farmer to the company. Just Us! Café has been able to make these products available to consumers through its numerous retail outlets.
This strategy has been able to worker for the company due to similar products from competitors available in the market. It has enabled Just Us! Café to attract price sensitive coffee consumers to its retail outlets.
The strategic options available to Just Us! Café
Differentiation through Technology and the Internet
Just Us! Café will find it important to have a thorough understanding of how the current technology works and integrate it to increase profit. It should take initiatives to re-evaluate its expectations and the role of marketing in a digital and networked marketplace.
The emerging technology creates the new customer-powered marketing concepts that are now possible due to the Internet and other technological inventions. Just Us! Café can use technology to facilitate viral, real-time marketplaces and auctions in the changing marketing environment. Just Café can identify customer-centric marketing goals that technology takes to “the next level, sales promotions, relationship marketing techniques, wide and narrow cast forms of advertising” (Solomon, Marshall and Stuart, 2009). Therefore, the current aim of the company’s marketing activities should use digital and networked channels such as the internet, mobile applications, interactive sites, and social media as marketing tools that the company can integrate in its work.
Just Us! Café customer base is expanding rapidly. From challenges of acquiring and retaining customers, customer management has become a critical option for success. The use of Customer Relationship Management (CRM) tools requires realistic approaches based on customers’ needs and expectations from Just Us! Café. This allows Just Us! Café and its customers to realise the importance of CRM. A clear strategy for Just Us! Café CRM application for delivering value to customers should depend on the following guidelines. First, Just Us! Café should have a clear vision for its CRM strategies. This will help the company understand how CRM can enhance its relationship with customers. It should also reflect values such as reducing costs of operation, savings, and potential growths in revenues Just Us! Café can get from the CRM tool. Therefore, Just! Café must explain the importance of CRM tool to its employees so that they can use it effectively. Second, Just Us! Café should focus on improving customer values by avoid delay in deliveries, wrong deliveries, or damaged deliveries. Understanding customer value will enable the company to identify customer segments it can target with various premium products. It also helps in understanding profitability of every customer. According to CRM, customer value helps a company to identify service levels for different segments of the “market, identify existing opportunities, create loyalty, and recruit new customers” (CRM Trends, 2012).
Value-based differentiation is fundamental for aligning CRM strategy with the aim of maximising value and profitability from consumers. Third, Just Us! Café should use CRM system to retain its customers. Thus, the company must stress the importance of customer service to its strategic objective. Provisions of information can help in facilitating the process of improving effective customer service. Just Us! Café should introduce attractive incentives to its regular or loyal customers. Such customers may enjoy discounts or free products of their choices. Fourth, the company must also rate the effectiveness of its CRM tool using a given metric. The process must have realistic targets so that the company can know its capabilities amidst competition from multinational firms. The use of regular feedback should drive CRM initiatives in Just Us! Café. Finally, customer service is a lifelong process. This means that Just Us! Café must also search for new information from customers for improving its levels of services across its stores on a continuous basis (CRM Trends, 2012).
Apart from CRM application, Just Us! Caf’e can also use the Internet to increase business processes, achieve efficiency, reduce costs, and stay ahead or keep pace with the competition. According to Henry Chesbrough of Harvard Business Review, the rise of the Internet allowed companies “integrate their supply chains, from the point of sale down to the suppliers” (Chesbrough, 2001). Just Us! Café can rely on the Internet for controlling its internal processes. The company can establish virtual network of consumers and resellers across Canada.
According to Michael Porter, strategic positioning is especially important when it becomes “difficult to sustain operational advantages” (Porter, 2001). Porter notes that small business can compete with large enterprises through gaining cost and pricing advantages. This is possible through leveraging the flexibility and speed of the Internet for competitive advantage. Just Us! Café can apply some principles for establishing strategic position. These include creating value-added premium coffee products, improving customer service, and establishing objective for achieving a long-term return on investment. The company can also use a customer friendly e-commerce site where customers can place their orders, engage customers in constant interaction, and create a strategy for continuous innovation. These are some of the approaches Just Us! Café can use to leverage technology and establish competitive advantage.
Recommend a course of action for Just Us! Café
In order to establish product superiority and customers’ interests, Just Us! Café must strive to work hard and introduce additional premium products and ready-to-drink forms of tea and coffee products. This is because of pressure from the increasing number of premium products customers. The company must note that coffee-themed restaurants shall be responsible for the industry growth in terms of creating demand for premium products and development of new products for the future. According to NAICS, some of the products, which have created interests in consumers include “single serve formats, premium blends, and flavoured coffees” (NAICS, 2010).
Just Us! Café must take advantage of Canada’s national electronic product registry called ECCnet. Substitute products have already adopted ECCnet. This application encourages the growth of e-commerce by allowing firms to track their products in the entire food chain system.
The company must also note that the coffee industry has attracted consumers from all segments of the market. We can attribute this attraction to premium blends, varieties from different parts of the world, specialty customers, and coffee flavour. The new forms of consumers have increased consumption throughout the day. This implies that Just Us! Café must not lack coffee to serve its customers, or else they will buy from competitors.
The company should also invest in CRM application for managing its growing customer base. This shall help in identification of customers’ value, segmentation for profitability, customer retention, and avoidance of wrong deliveries among other benefits.
In order to outdo competition, Just Us! Café marketing strategy should find out how products have impacted its consumers and sales volumes. It should also look focus emerging products, which may outsell its established products, and how to position its products for competitive advantage. The company’s marketing techniques should identify how to attack competitors by fighting for its market share. Consumers have too many brands of coffee and tea products to choose from in the marketplace. The company’s marketing strategy should emphasise the value of its brands. There is a need to understand “the psychological motives that drive today’s consumers in order to reposition the brand among competitions” (Brassington and Pettitt, 2005).
The company should also exploit marketing opportunities that it can get from Fair Trade activities. This is because of the global appeal of Fair Trade initiative. It provides free marketing opportunities to Just Us! Café.
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