Product Life Cycle Krispy Kreme Doughnuts example essay topic

Sarah Houck Ivan Serrano Kellie Simpler Mission Statement All products we make in our stores will have a quality second to none. The starting point in controlling product quality is controlling the quality and freshness of the ingredients. We will be thoroughly prepared to execute growth initiatives when they become needed. We view quality, service, and innovation as keys to creating and maintaining a competitive advantage. We view our company as a set of capabilities, not just a product or brand. Focus Our focus for this presentation and the remainder of our project is the doughnut product line at Krispy Kreme.

Competition Direct Competitors: Dunkin Doughnuts Tim Horton's Local Bakeries Grocery Stores Indirect Competitors: Starbuck's Noah's Bagels Other Coffee Shops Ice Cream Stores Marketing Concept Krispy Kreme does not have a production orientation because they focus on their customers needs / wants. We believe Krispy Kreme practices the marketing concept effectively through their marketing orientation. Evidence of an Effective Marketing Concept Customer Satisfaction Total Company Effort Profit as an Objective Krispy Kreme has adopted the marketing concept by seeing customer satisfaction as the path to profits. It is structured to support and profit from the "high volume with high quality" production of doughnuts. Market Bakery Products -doughnut stores, bagel shops, breakfast fast foods, bakeries, late-night dessert stores Size of Market: $15,987,900 Market Share: 17% Product Growth 2001 fiscal year: 17.1% 2002 fiscal year: 12.8% 2003 fiscal year: 11.8% Industry Life Cycle The doughnut market is in the growth phase of the product life cycle. Industry sales are still increasing and profit is rising for firms in the industry.

In 2002, the doughnut market saw a 9% gain in sales over 2001. Product Life Cycle Krispy Kreme doughnuts are definitely experiencing growth. The Krispy Kreme investor relations website boasts "strong growth potential" for the future and a recent 5 year annual revenue growth rate of 25.36%. Also Krispy Kreme's growth is apparent through their continued nationwide expansion and their recent entry into the global market including Canada, the United Kingdom, and Australia. Krispy Kremes are now delivered to many grocery stores and gas stations and are "coming soon" to a Walmart near you!

Krispy Kreme Appeal Krispy Kreme doughnuts have a universal appeal. Stated on their website: "Our market research indicates that Krispy Kreme's breadth of appeal extends across all major demographic groups, including age and income. In addition to their taste, quality and simplicity, Krispy Kreme doughnuts are an affordable treat". A Fortune Magazine article supported Krispy Kreme's claim of "universal appeal". According to the publication", [Krispy Kreme doughnuts] are loved equally by 5-year-olds and 75-year-olds.

By whites, blacks, Asians, and Hispanics. By New Englanders and Southerners. By Californians and New Yorkers. (Never mind by junkies and cops.

)... Only three types of people claim they don't like Krispy Kremes: nutritionists (your basic glazed has 200 calories and 12 grams of fat), Dunkin' Donuts franchisees, and compulsive liars". Target Market Considering this wide range of consumers that Krispy Kreme appeals to, the target market is incredibly broad. The target market spans all demographics and extends to virtually all individuals within the geographic proximity of their retail locations. Market Segmentation Given the breadth of their target market, there are countless dimensions that could be used to segment the market. We were unable to find a breakdown of the particular segmentation scheme that Krispy Kreme uses.

Since the target market is so broad and extensive, Krispy Kreme uses a combined target market approach. They combine numerous sub markets into one larger target market as the basis for their marketing strategies. Product Positioning Hot and Fresh "Hot Doughnuts Now" sign Free Doughnut when sign is neon green The original glazed doughnut Doughnut of the month promotion Caramel Kreme Crunch Krispy Kreme vs. Competition "Socialites" Great Place to hang out w / friends, have conversations, or just hang out Cravers Krispy Kreme is very craving Many Promotions Sheep The attention Krispy Kreme gets from the media Curious how different the shop is from others They show how they make their doughnuts Krispy Kreme vs. Competition (Con't) "Hot Doughnuts Now" sign Get a free doughnut when sign is on Light and Fluffy Krispy Kreme's are a lot lighter and airier than most doughnuts Drive-Thru Late night hours! K.K.'s Marketing Environment Competitive Having the hot and ready glazed doughnut Wal-marts Economic Affordable Prices Giving out free Doughnuts Technological Showing how their machines make the doughnuts K.K.'s Marketing Environment Cont' Cultural and Social Media attention Fundraising Elementary School Students Political and Legal FDA OSHA.