10/5/2018 Develop Organizational

Marketing Objectives
BSBMKG608
Task 1: Organisational review

Muqthar Gowri Mohammed

GEORGR BROWN COLLEGE
GBC 170400
Task 1: Organisational Review

Brief Summary:

‘Cocoa Delights’ founded in 2000, is one of the finest and youngest gourmet chocolate
manufacturers in the industry. It is the first Australian company to process more than 10 different
types of cocoa from several countries, choosing the one of the finest cocoa beans available around
the world.

It is estimated that the gourmet chocolate company is holding $1.5 m in annual sales with a
projected growth rate of 10% per annum. The envisioned growth of cocoa delight’s not only come
from enthusiasm management, but it also come from company highly skilled employees which
greatly stimulate the envisioned growth.

Cocoa Delights is committed to becoming the leader in the Australian market for premium quality
chocolate and maintaining a company culture which fosters and encourages continuous
improvement.

Cocoa Delights would like to take an opportunity to provide the Australians to enjoy quality
chocolate which are usually associated with Swiss and Belgium brands whilst securing the knowledge
of fair trade practises and supporting sustainability both within Australia and Internationally. With
the combination of innovation, creativity and artisan expertise, Cocoa Delights will not only looking
to achieve customer satisfaction levels, but also looking to surpass its rivals.

Introduction:
Cocoa Delights’, a chain of 15 gourmet dark chocolate stores in Melbourne, specialising in creating
handmade dark chocolate products. The organisation is close to reaching its set goals and looking to
activate the next phase in its development. Cocoa Delights appointed me as a Marketing Manager
and asked me to undertake an organisational review. The CEO of the company has provided me the
information of:

● The Cocoa Delights marketing plan (December 2017)

● An excerpt of the annual report by the Chair (December 2017)

● A subsequent interview

● The latest IBIS report for the industry.

After studying the case study of Cocoa Delights, I found the following information about the
company:

Vision:
By 2022, I see Cocoa Delights as being a significant retail presence in every Australian capital
city, starting with 22 stores in the greater Melbourne area and growing to 100 stores
Australia wide.

Mission:
Within the next 5 years, Cocoa Delights will become a national retail brand that satisfies our
customers with a range of unique, high quality dark chocolate, as well as providing exceptional
customer service from our highly skilled and dedicated staff.

Purpose:
Cocoa Delights has always been daring and unconventional. Creativity and innovation have always
been our strength and the cornerstone of our success. Externally, we are committed to sustainable
environmental practices and offering meaningful value to our customers.

Values:
For our stakeholders, we have always been about stewardship and adhering to professional and
moral standards of conduct in all that we do. For employees, we are committed to encouraging self-
directed teams; we cultivate leadership and maintain high levels of safety.

Strategic Direction:
We now need to change our focus from local suppliers of services to national ones, and to think
about opportunities to save money by gaining a wider geographic benefit and choosing media with a
national reach.

 Cocoa Delights’ want to become a no. 1 gourmet dark chocolate provider, expanding their
business by starting with 22 stores in Melbourne and growing to 100 stores in Australia
wide.

 Cocoa Delights’ want to compete with their competitors by providing dark decadence
products range, Australian owned and certified organic supplier, and by sustainable and fair-
trade practices.
 Cocoa Delights’ will try to expand their business by promoting more health-conscious
chocolates and largest range of dark chocolate varieties and products.
 Cocoa Delights’ will follow and abide the new laws imposed by government and practice fair-
trade to deal with sustainability issues.

Targets:
1. To increase revenue by 6% yearly over the next three years.
2. To become the gourmet chocolate market leader within five years.
3. To become established as the national retailer of choice for chocolate connoisseurs within the
next three years.
4. To increase our share of the dark chocolate market by 15% over the next three years.
5. Establish Cocoa Delights as Australia’s most respected chocolate maker.
Critical Analysis
Latest IBIS Report
After studying the latest IBIS report for the industry, I found their current situation compare Cocoa
Delights’ marketing plan from 2017.

● Interest rates are in fact rising, but this currently based on economic forecasts, it could be
different.
● The same assumption is made about unemployment which has also risen to 5.8% based on
economic forecasts.
● The social trend towards people eating chocolate is growing stronger than anticipated, but we
need to consider demographics, lifestyle, geographic, product usage level in order to give any
conclusion.
● Broadband rollout has been delayed, putting on hold some of the organisation’s internet
marketing plans, but there targeted audiences are not just the online customers because the
company has spent more on direct mail, magazine advertising, and radio promotions.

Vision Statement by the CEO

According to vision statement provided by the CEO:
By 2022, I see Cocoa Delights as being a significant retail presence in every Australian capital
city, starting with 22 stores in the greater Melbourne area and growing to 100 stores
Australia wide.
It is not possible achieved that vision, if we look into the facts presented in the report that shows the
expansion in sales and cost effectiveness are key issues in which the organization has spent
$280,000 overall for product marketing. The total loyal customers are only 34,500 which represents
58% of people in the target market recognise the Cocoa Delights brand. The company gross margins
are currently sitting on 46%.

Market Strength of providing finest quality coffee

The company need to consider the prices of buying the finest cocoa beans from supplier from
several countries as they were planning for return on investments. Buying finest cocoa beans from
suppliers will cost more to produced finest quality chocolates.

Sustainability in terms of electricity usage

Using bright store to display the product and air-conditioners will definitely cost more and
significantly high usage in electricity which will not only impact on company targets, but also effect
environmentally.

Made in Australia
Being made in Australia activity does not impact on sales and customers, as most of the customers
go accordingly, how the chocolate taste like? They see different options, whether options like dairy-
free, and vegan or organic is available or not?
Current Marking Plan
Gross Profit Margin
The company have achieved their store growth and sales growth, but the gross profit margins are
still sitting on 46% as well as their gourmet chocolates and hot drinks are still below the threshold
which they predict should be at an average gross profit of 63%. So, after analysing these figures the
company might have to change their vision because to achieve the vision the gross profit margins
has to be over 85% at least.

Advertising Effectiveness
Spending huge amount of money on advertising is not a great idea rather than we should do more
focusing on local opportunities in every state such as by franchising or joint-venture instead of going
nationally.

Loyal Customers
The organization should come up with loyalty program offers to occupied maximum customers. The
current number of customers are only 34,500 which is about 58% of people are aware of Cocoa
Delights’ brand according to survey done in the targeted market.

SWOT Analysis
SWOT analysis has to be change and review, as the new competitors can change the market growth.
The organisation strength, weakness, threat and opportunities will significantly change if we do not
review it quarterly.

Social trends towards chocolate eating

Cocoa Delights will try to capitalise on the social trend of consumers being more health conscious, by
Chocolate eaters do not buy chocolates every day, they buy when there is any occasion, giving to gift
to someone, or eating for their personal enjoyment. So, the trends of eating chocolate is not rising
rapidly, but the consumers are growing slowly.

Broadband rollout disruption issue

Due to broadband rollout has been delayed, putting on hold some of the organisation’s internet
marketing plans, but the targeted audiences are not just the online customers because the company
has spent more on direct mail, magazine advertising, PR and radio promotions, they can use these
marketing options.

Recommendation
After reviewing the critical analysis, I come to conclusion that the vision statement provided by CEO
cannot be fulfil by 2020 for the following reasons:

1. Cocoa Delights’ want to expand their business by growing their business from 22 stores in
greater Melbourne area to 100 stores Australia wide, but , if we look into the facts
presented in the report that shows the expansion in sales and cost effectiveness are key
issues in which the organization has spent $280,000 overall for product marketing. The
total loyal customers are only 34,500 which represents 58% of people in the target market
recognise the Cocoa Delights brand. The company gross margins are currently sitting on
46%.
So, the company has to come up with new promotion in order to cover the threshold for
gourmet chocolate and hot drinks or by offering loyalty discounts. The significant amount
 which they spend on magazine and direct marketing advertising is not a great idea, instead
of that amount should have been used in local promoting area by area.
2. Providing finest quality cocoa beans chocolates is not always cheaper because the cocoa
prices can go up and down, they might have to buy high cost beans for finest chocolate
production in future and it was not easy to cover in their budget as they were expecting a
return on investment. So, it is better to have a contract with supplier for a constant prices of
cocoa beans for over a period.
3. Sustainability is the big issue for Cocoa Delights’ because the company in the past have been
deliberately designed to be bright and comfortable places to shop which cost them high in
electricity usage. Therefore, the plan is to use energy efficient bulbs which still provide
bright light and costing less.
4. Another issue which is being made in Australia activity does not impact on sales and
customers, as most of the customers go accordingly, how the chocolate taste like? They see
different options, whether options like dairy-free, and vegan or organic is available or not?
So, it better to provide variety of options to customers rather than just displaying made in
Australia activity.
5. SWOT analysis has to be review every quarterly years, as the new competitors can change
the market growth. The organization has to update their CRM and analysis the market
trends by comparing their products growth with competitors.
6. Chocolate eaters do not buy chocolates every day, they buy when there is any occasion,
giving to gift to someone, or eating for their personal enjoyment. So, the trends of eating
chocolate is not rising rapidly, but the consumers are growing slowly and we have offer best
of best service to make them as loyal customer.

Situational Analysis

PEST Analysis

A PEST analysis is a process to identify the political, economic, social and technological factors that
can affect the supply chain – both locally and internationally.

POLITICAL FACTOR:

The governments are pushing companies to manage their sustainability issues such environmental
issues for a waste management and energy conservation. Cocoa Delights’ use to be bright and air-
conditioning stores for their customers, but it significantly costing them huge amount of money for
energy consumption and as well as is not sustainable for environment.

The new laws are going to implement by governments in order to tackle sustainable issues, Cocoa
Delights’ sees this as a positive for their business model. Cocoa Delights, as a business operating in
Australia, will abide by the law in all its dealings and comply with all legislation which are impacting
on its business activities.
ECONOMIC FACTOR:

Based on the economic forecast, interest rates are climbing in short-term period, but it will be
expected to level out in a sustainable levels for the coming three years. It is also observed that
disposal income has been drop due to the rising interest rates, however, it is expected to be
recovered in the long-term, with wage increases expected to overtake inflation rates by 2%.
Unemployment levels are also rising and expected to increase steadily to 6% in the coming years.

SOCIAL FACTOR:

The market trend for gourmet chocolate are becoming more sophisticated and informed in regards
to item quality and product choices, because customers are preferring high-quality products and
specific dietary requirements so customers are learning to appreciate the qualitative difference.

Cocoa Delights’ will try to expand their business by promoting more health-conscious chocolates and
largest range of dark chocolate varieties and products.

Cocoa delights make fair trade and sustainable practises a key part of their marketing messages.

TECHNOLOGICAL FACTOR:

Most of the retailers want to take advantage of new technological developments of the broadband
rollout across Australia, but it has been delayed and will be expected to be completed in next three
years. Internet retailing options are expanding rapidly and this new advancement can give a
competitive edge for most retailers.

Cocoa Delights’ will targeted advertising on radio, TV, the internet and in the press to build the
foundation of company advertising and promotion effort.

LEGAL AND ETHICAL REQUIREMENT

The governments are pushing companies to manage their sustainability issues such environmental
issues for a waste management and energy conservation. Cocoa Delights’ use to be bright and air-
conditioning stores for their customers, but it significantly costing them huge amount of money for
energy consumption and as well as is not sustainable for environment.

The new laws are going to implement by governments in order to tackle sustainable issues, Cocoa
Delights’ sees this as a positive for their business model. Cocoa Delights, as a business operating in
Australia, will abide all the laws, and its dealings and comply with all legislation which are impacting
on its business activities.

Another requirement by government is imported products must clearly state the country of
manufacture, however, the government is presently allowing companies to self-regulate rather than
passing the new laws. All Cocoa delights’ products are proudly made in Australia and company
always practise this activity and sees this an opportunity to increased market-share, when compare
with their competitors who are selling imported chocolates with a poor reputation for quality and
employment ethics.

IMPACT OF THE ORGANISATIONAL STRATEGIC DIRECTION ON CURRENT MARKETING

ACTIVITIES
Cocoa Delight’ achieved the sales growth and store growth, the gross profit are presently sitting on
46% which are still below the threshold, but expected to increase by 63%. Expansion of sales and
cost effectiveness is the big problem for the company. The organization spend a significant cost on
advertisements which is unplanned, but achieved a sales results though. The customer loyalty list is
only about 35,400 customers and a survey conducted in 2017 shows that 58% recognised the Cocoa
Delights’ brand in a target market.

Company is now focus on to become a national leader from local suppliers, and thinking to gain a
wider geographic benefit by choosing the right media campaign to reach it nationally.

The organization want to increase their revenue by 6% yearly, increase share of the dark chocolate
market by 15%, and become a national retailer of choice for chocolate connoisseurs with the next
three years.