The Wonders of Food &

Beverage marketing ( F & B)

 What is food?
Food is any substance consumed to provide
nutritional support for the body. It is usually
of plant or animal origin, and contains essential
nutrients, such as fats, proteins, vitamins,
or minerals. The substance is ingested by
an organism and assimilated by the
organism's cells to provide energy, maintain life,
or stimulate growth.
 What is Beverage?

A beverage is any type of drink. It's something

you might offer a guest in your house; it's also
the favorite moniker of companies that
manufacture both soda and juice — they call
themselves beverage companies. One of the
most popular beverages in history is Coca-
Cola, developed in 1886.
Definition: Food Marketing
Food marketing is an
activity or process that
delivers, communicates or
exchanges information
about food that is
important to the consumer
products are categorized as
FMCG
Fast moving consumer goods
Main players in F & B
Industry
 CONSUMER

CATERING FARMERS

SUPPLIERS
PROCESSORS
WHOLESELLERS
& RETAILERS
Quick preview of F& B
Industry
 Global F & B sector was valued $ 5.7 trillon
dollars in 2008.

The industry is one of the major contributors

to growth in all economies and is expected to
increase to $ 7 trillion by 2014.

 Top few players Nestle, Kraft foods, Unilever

& Cargill account for 5% of overall value.
Europe has the largest market share in global F
& B industry with revenues of 1.4 trillion in 2007
employing 4 million workers, followed by USA $
1 trillion.

Asia and India are the major raw material

provider with India having a revenue of $ 182
billon in 2007- 2008.

 Major problems facing this sector is rise in food

prices, rise in oil prices, decline in consumer
purchases.
• F & B industry is the least affected Industry
compared to others as food is always
considered essential.

• In developing countries purchases are

shifting from staple carbohydrates to
expensive food such as meat and dairy
products , now 58 % of food produced is
consumed by developing countries and
expected to rise to 72 % by 2050.
Examples of Top companies
(Video)
 NESTLE
Description nutrition & health
Products Beverage, ice-cream, milk
products, water, confectionary

Brands Nescafe, Maggi, Kit Kat, Nestle,

Power bar, Gloria

Customers Over 120 countries

 PEPSICO
Description Global beverage, snacks, food
Products Salty, convenient sweet & grain
based snacks, carbonated & non-
carbonated beverages.
Brands Pepsi, Diet- Pepsi, Merinda,
Mountain dew, Chips and chunks.

Customers USA, Europe, Asia, Middle East,

Africa ( 200 countries)
 CADBURY (UK)
Description Confectionary & beverages
Products Chocolates , Gum, Candy

Brands Cadbury dairy milk, Crème egg,

Flake, Hollywood, Bubbaloo

Customers Europe, Americas, Asia- pacific,

Africa.
STARBUCKS
MOBY DICK

STARBUCKS NAME
BALDWIN – BOWKER – SIEGL
SEATTLE, 1971 - FIRST STARBUCKS
  58 years old

 Grew up poor

 His father had a hard life

 Excelled at sports and won an

athletics scholarship

 Graduated in Business &

Marketing

 Joined Starbucks Company in

1982 as Director of Marketing
HOWARD SCHULTZ – CEO OF STARBUCKS
 1983 he went on a trip in Milan:
 Coffee bars existed on
every street
 200.000 in the country
 Served as meeting places

 His idea: bring the Italian

coffeehouse tradition back to
the United States

 The pilot coffee concept was

successful but the owners
refused to develop the concept

HOWARD SCHULTZ – VISION OF A CEO

 1985: Started his own coffeehouse: Il Giornale Coffee

 1987: purchased Starbucks Coffee (6 stores)

 Renamed Il Giornale Coffee with the Starbucks name

 Expended aggressively first across the United States

and then around the world

HOWARD SCHULTZ – VISION OF A CEO

HOWARD SCHULTZ – HIS PHILOSOPHY
 2008: regained his status as a CEO of Starbucks

 Co-authored: “Pour Your Heart Into It”

 “Starbucks may become another soulless big chain”

HOWARD SCHULTZ – HIS FEAR

 2009:
 616 US Starbucks Coffee closed
 1/3 of the headquarters employees were fired
 2000 jobs lost

TOO MANY STORES…TOO EXPENSIVE

HOWARD SCHULTZ – THE NEW LOGO
 1st ROASTER AND
RETAILER
50 COUNTRIES

15.000+ STORES

STARBUCKS TODAY
 18-45 year olds

 Youngsters who want to gather with their friends

 Office workers and students who need to catch up with

their work

 Those who feel that drinking coffee is "cool"

 People who are adventurous, willing to try new things

TARGET
  Egypt

 South Africa

2 / 52 - (4%)

STARBUCKS IN AFRICA
 EAST ASIA NORTHEN ASIA
• China • Russia
• Hong Kong
• Macau WESTERN ASIA
• Japan • Armenia
• South Korea • Barhain
• Taiwan • Cyprus
• Jordan
SOUTH EAST ASIA • Lebanon
• Indonesia • Kuwait
• Malaysia • Oman
• Philippines • Quatar
• Singapore • Saudi Arabia
• Thailand • Turkey
23 / 44 - (52%)
• United Arab Emirates

STARBUCKS IN ASIA
 NORTH AMERICA (100%)
• Canada
• USA
• Mexico
• Puerto Rico

CENTRAL AMERICA (3/52 - 14%)

• Aruba
• Bahamas
• El Salvador

• SOUTH AMERICA (4/10 - 40%)

• Argentina
• Brazil
• Chile
• Peru
STARBUCKS IN THE AMERICAS
 • Austria • Ireland

• Belgium • Netherlands

• Bulgaria • Poland

• Czech Republic • Portugal

• Denmark • Romania

• France • Spain

• Germany • Sweden

18 / 37 – (49%) • Greece • Switzerland

• Hungary • UK

STARBUCKS IN THE EUROPE

  Australia

 New Zealand

2 / 9 – (22%)

STARBUCKS IN OCEANIA
 Names are translated into local languages
• South Korea: 스타벅스 (transliteration: seutabeokseu)
• Arabic-speaking countries: ‫( ستاربكس‬transliteration: stārbaks)
• Bulgaria: Старбъкс (transliteration: Starbâks)

AN ADAPTATION STRATEGY
 Adapting their products

•Different muffin flavors, different cheesecakes

AN ADAPTATION STRATEGY
 Adapting to their markets

• Products launched in limited international

markets.
• Sold in supermarkets and convenience stores

AN ADAPTATION STRATEGY
 2003: Starbucks closed all six of its locations in Israel
due to difficult business environnent
 2007: closed its store in Beijing's Forbidden City
 2008: closed 61 of its 84 stores in Australia: Starbucks
failed to truly understand Australia’s cafe culture.

STARBUCKS FAILURES
 Product diversification
 Established logo, developed brand, copyrights,
trademarks, website and patents
 Company operated retail stores
 International presence
 Valued and motivated employees, good working
environment

STRENGHTS (1/2)
  Good relationships with
suppliers
 Industry market leader
 Customer loyalty
 Wide spread and consistent
 Knowledge based
 Strong Board
 Trendy brand image
 Strong financial foundation

STRENGHTS (2/2)
 Lack of internal focus (too much focused on
expansion)
 Cross functional management
 Product pricing is high

WEAKNESSES
 Competition (restaurants, street carts, supermarkets,
other coffee shops, other caffeine based products)
 Market saturation
 Coffee price volatility in developing countries
 Negative publicity from poorly treated farmers in
supplying countries

THREATS (1/2)
 Consumer trends toward more healthy ways and
away from sweet coffee beverages and cakes
 Cultural and Political issues in foreign countries

THREATS (2/2)
  Expansion into retail
operations
 Technological advances
 New distribution channels
(delivery)
 New products
 Distribution agreements
 Brand extension
 Emerging international
markets
 Continued domestic
expansion/domination of
segment

OPPORTUNITIES
 Width

• Espresso beverages
 Caffe latte, Caffe Mocha, Caramel machiato…
 Iced caffe Latte, Iced vanilla Latte…
• Frapuccino
 Coffee base, cream base and tea base Depth
Lenght • Coffee and tea
 Hot chocolate, soya milk, tea
• Food
 Cookies, muffins, salads, sandwiches, coffee
bags…
• Equipment: mugs, coffee machines…

STARBUCK’S PRODUCT RANGE

 Warmth, Comfort, Diversity

 A place of quiet contemplation

 Some kind of neighbourhood office

 A gathering place for neighbours and friends

PLACE: A PLACE FOR AMBIENCE & EXPERIENCE

Friendly baristas Customized beverages

PLACE: A PLACE FOR AMBIENCE & EXPERIENCE

STARBUCKS IN MOVIES

The devil wears Prada

PROMOTION: PRODUCT PLACEMENT

STARBUCKS IN MOVIES

Meet The Fockers 4

PROMOTION: PRODUCT PLACEMENT

STARBUCKS IN MOVIES

Fight Club

PROMOTION: PRODUCT PLACEMENT

PROMOTION: DIRECT MARKETING
SNS
SNS
 Environmental impact
 Creating “Grounds for

your Garden”

 Using recycled materials:

ranked 15 on the
U.S. Environmental
Protection Agency’s list of
Top 25 Green Power
Partners

PROMOTION: COMMITMENT TO THE WORLD

Fair Trade
 Largest buyer of Certified Fair Trade coffee in North

America (10% of the global market)

 Starbucks has given the FTC label greater visibility,

helping to raise consumer awareness in the process.

 Payes above market prices for all of its coffee

 Opens farmer support centers in Africa

PROMOTION: COMMITMENT TO THE WORLD

PROMOTION: COMMITMENT TO THE WORLD
 Ethos water

 Ethos bottles feature prominent

labeling stating "helping

children get clean water”

 $.05 from each $1.80 bottle sold is

used to fund clean water projects in

under-developed areas.

 Sales have raised over $6,200,000

PROMOTION: COMMITMENT TO THE WORLD

Product ( red )
 Raise awareness and funds to help eliminate AIDS in

Africa.

 Starbucks’ Red products and Red card:

PROMOTION: COMMITMENT TO THE WORLD

Helping countries after natural disasters

PROMOTION: COMMITMENT TO THE WORLD

 Global company

Howard Schultz: Geocentric Orientation

Adaptation Strategy

Globally Successful

Future Oriented

IT IS NOT JUST COFFEE, IT IS STARBUCKS COFFEE

 Dairy products
• How many dairy products do you know?
Dairy products
story
in Sudan
 Fresh Milk marketing

FORMAL
Less than
2.7 %
 Formal marketing
• Main Dairy plants:
• 1- CAPO.
• 2- FAAPY.
• 3- BEST.
• 4- PREMIER.
CAPO
PREMIER
 INFORMAL MARKETING
• Controlled mainly by Intermediaries.
AlAIN Dairy
Company
CASE DISSCUSSIONS
OZONE
TEA LADIES
MEAT MARKETING

IN SUDAN
 Marketing channels
D = Damin
B D Producer Farm
B = Brokers

Gelaga D BB
D

D
B D Primary Market
Sub agents D
Sebaba Jelaba
B
D B
B
D
Agents Secondary Market
Local Butcher
D

B
Local Merchants B

B
Wholesale Butchers
Terminal Market
Wholesale Merchants

Retail Merchants Retail Butchers

Consumer
‫قندهار‪ -‬اوالد ام درمان‬
 Understand
Think like a Act like a your Go to the Grasp
consumer producer product market culture
fully
•Your Questions are
welcome