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1.1 Introduction
Everybody loves chocolates. Be it kids or the elderly. Filipinos are known for
having a sweet tooth and we greatly enjoys sweet foods. People around the world are fond
of sweets, and some people associate sweet foods specifically with comfort and well being.
There are variety of reasons why people are predisposed to like sweets. Being fond of
eating sweets isn’t a bad thing although it might lead to a health problem. Here in the
Chocolate has become one of the most popular food types and flavors in the
world. It can be molded in different shapes and becomes traditional on certain holidays.
The researchers choose the firm Choco Mocco for its study. We choose the topic
Product Line Extension and Sales Promotion for Choco Mocco. The firm is offering
chocolate products, beverages, ice cream and snacks. This study aims to determine a
better marketing approach to be done to persuade more customers and increase its sales.
Serbetci. The owner was inspired by his friends and put up this kind of business. The store
is strategically located at the Lower ground floor of SM Manila, in front of Food Court. The
firm targets the shoppers which are mostly students from different schools. It’s existence is
popularly known for it’s chocolate products and it’s welcoming ambiance.
The firm is known for it’s variety of Chocolate products which made it distinctive
among its competitors in the said area. Among it’s principal products are Chocco Mocco
(chocolate served with fruits), Choco Sticks (chocolate dipped goodies,kebab style), Choco
Ice Cream (which consists of Six Flavors to choose from: Strawberry, Vanilla, Chocolate,
Ube, Capuccino and Cheese), Special Choco , Choco Beverage, Choco Snacks and Choco
Shots. These principal products are served in different variety. The firm serves through dine-
The first two weeks of its existence did well but suddenly declines its sales. Aside
from having so many competitors in the market, the firm is not financially stable and lacks
increase the demand for their product to acquire profit for the stability of the firm.
The main source of information will be directly from the owner of the firm,
customers who patronizes the product and those who are not aware of its existence. From
the facts gathered, we will analyze and set strategic plan on what promotional activities
should be done to persuade more customers and what other products should be added to
The focus of this research is about the marketing strategy which is product line
extension and sales promotion. This research aims to achieve the following:
more sales.
find out what Sales Promotion activity is needed which fits
find out if adding products to the firm’s product line will increase
its sales.
line.
Dine- in Customers;
Product Line
Manager; Staff;
Survey, Extension
Passers by
Random Sampling, And
Interview Promotional
Products
Activities
The firm is finding a better approach on how to increase the demand for
Choco Mocco’s product through Product Line Extension and Sales Promotion to
increase the profit of the firm and make it financially stable and survive in the
competition.
• What causes the decline of sales of Choco Mocco after 4 months of its existence
in the market?
• Is there a need to add products on its product line? What should it be?
1.5 Hypothesis
Ho: There is no significant effect on having sales promotion and product line
extension on increasing Choco Mocco’s demand for their product and earn profit for
its survival.
This study will find ways on how to uplift the demand for Choco Mocco’s
product to increase its sales and able to sustain its operation and find better
approach through sales promotion and product line extension for them to remain in
the competition despite of arising competitors in the market. Through this research,
the management may able to apply this study and use it for the consistency of their
business.
information, facts and opinions of every people involved in the said study.
This study will be focusing more on what would be the possible marketing
strategy that should be done to increase Choco Mocco’s sales. The survey will be
conducted at SM Manila where the firm is situated. The respondents would be the
manager, the staff, customers and those who are unaware of the firm’s existence.
necessary information which are: surveys, personal interview and observation. This
Chocolate- is a sweet hard food made from cocoa beans. It is usually brown in
Ice Cream- is a very cold sweet food which is made from frozen cream or a
substance like cream and has a flavor such as vanilla, chocolate or strawberry.
Survey- it is one of the market research method that asks concise questions to
buying behaivior.
CHAPTER 2
2.1 Literature
“Wealth” – APB’s Recipe For Increasing Profits, “it takes a significant amount of time and
investment in personnel to get new stores up and running profitably”. For many, it is
quite surprising to learn how much hand-holding this process actually takes. So, how do
dealerships overcome being “people broke” so they can focus on growth and
order to maximize total profits from the original product and the line extension? We
identify three critical issues which affect the answer to this question: the interrelationship
of sales of the two products because of substitution and diffusion, the relative margins of
the two products, and the relationship of the length of the firm's planning horizon to the
original product's diffusion time. We develop a model in which the first product
contributes a higher unit margin; however, sales develop slowly. The line extension
contributes a lower unit margin and partially cannibalizes sales of the original product,
but also broadens the market, causing sales to develop more rapidly. The timing of the
introduction of the line extension affects the subsequent sales pattern for both products
and the total profit to be made within the planning period. The optimal entry time depends
upon the product pair's substitutability. We show that it is best either to introduce the line
extension at a time early in the life cycle of the original product or not to introduce it at all.
Consideration of dynamic phenomena can make a difference. For example, our results
indicate that in some cases the line extension should be introduced early, whereas a
simpler static analysis (which neglects diffusion and the implications of a finite planning
horizon) would indicate that the line extension should never be introduced.” (Wilson, L.,
& Norton, J. (1989). Marketing Science: Optimal Entry Timing for a Product Line
University of Virginia.)
around a new product or service. She also added that if products are introduced several times,
customers will have enough familiarity with the product and gain trust and will probably lead to
• The Brand name of the firm is very much catchy • The firm don’t have much promotional
The difference between sales promotion and product line extension is that, Sales
Promotion is used to increase sales by providing extra incentive to purchase and creates
brand image and suddenly leads to brand loyalty. Through sales promotion, there will be
an impulse purchases by the customers. On the other hand, Product Line Extension,
offers multiple products to customers which provides choices to the customers. Both
With the facts that the researchers had gathered, it is applicable with
Choco Mocco to have product line extension since it is still at the early stage of the
business’ life cycle. Added with intense promotion, the firm will be able to increase the
acquire responses from the target respondents who are the customers and unaware
passersby in the said location where the firm is situated. The researchers will