Marketing plan for Ben and Jerry's based on case data

Ben & Jerry's:

A Strategic marketing plan

Ben & Jerry's the international leader in handcrafted ice cream with a social conscious is analyzed in this strategic marketing report. Developed on an integrated public-private business prospectus, the Company set the tone for trailblazing product and brand identity configurations with an ethic of social responsibility and global sustainability long before it was customary. Although now subsidiary to the products and services giant, Unilever, Ltd. In the United Kingdom, Ben & Jerry's retains its Vermont beginnings both in grassroots image and Americana flavor in ice cream. Well-known for instigating social change through commercial planning, situation analysis of the Company's early and unique marketing platform prior to the sea of new market concepts is long overdue.

Table of Contents

Executive Summary

Situation Analysis

SWOT Analysis

Objectives & Issues

Marketing Strategy

Budget

Controls

Bibliography 20

Situation Analysis

Bought by British conglomerate, Unilever, Ltd. In 2000, U.S. based Ben & Jerry's performs as a boutique product line within the novelty food segment of the umbrella Company's global business retail sector. Known for its flavor names such as Chunky Monkey, Phish Food, and Cherry Garcia, the ice cream corporation begun in 1978 in a renovated gas station in Burlington, Vermont, Ben & Jerry's now strategizes contiguous marketing interests with its acquisition partner, and in continuity with the origin of its high profile sell.

Often called the "merry pranksters" of the food industry, the Company has made a niche position for itself on the international ice cream market through stand up activist PR, intended to follow the original ideological impetus behind the product and its founders. Early to the environmental and social responsibility platforms now made standard within the tertiary activities deemed "core competencies" of corporate strategic plans, reinvention at Ben & Jerry's is met through innovation and quality in support of the Company's mission and values, through a tri-partite framework of objectives toward realization of product, economic and social goals.

Even prior to the supra-visionary statement of making the 'mom and pop' Vermont foodie company an international superstar sold and distributed by Unilever, the Company promoted its product through retail experience stores, franchising some seven hundred and fifty Ben & Jerry's SCOOP SHOPS worldwide (Hoovers, 2010). Philanthropic expansion created a seamless vision of Ben & Jerry's as revenues generated a portfolio of a minimum of $1.1 million of pretax profits then earmarked through the entity's charitable organization, the Ben & Jerry's Foundation and its cause oriented mission and programs annually. The company also "sponsors PartnerShops, which are Ben & Jerry outlets independently owned and operated by nonprofit organizations, such as Goodwill Industries" (Hoovers, 2010). Macro to micro interests are approached according to trend analysis within the Company, and personal concerns serve to inform decision on other causes from global warming to saving family owned and operated agricultural firms.

Fostered by tales of Cohen and Greenfield packing the ice cream pints for sale in local grocery stores in early 1980s, emergence of the company as a small franchise chain coincided with Time magazine hailing the product as "the best ice cream in the world." Just one year later, Ben & Jerry's Homemade had gone public in a Vermont-only stock offering in 1984 (Hoovers, 2010). Five years after the first commercial cream, the Company churned over $4 million sales for the year. By 1986, they had signed a national distribution agreement with Dreyer's Grand Ice Cream, and succeeded in reaching customers in 18 states and Canada. Twelve years into the relationship with Dreyer's relations grew sour, and in a surprise offer to Haagen-Dazs, a formerly adverse entity that was party to pre-litigation settlement with Ben & Jerry's over distribution dispute agreement with the larger ice cream corporation in the 1980s.

Product innovation at Ben & Jerry's has been flavor-centric, yet narrow and slow in terms of universal market response. Research and development of a proximate competitor to meet the challenge of the explosion of fat-free mania ice-cream alternatives in the early 1990s, was responded to with introduction of its frozen yogurt product in 1992, yet not followed by a nonfat frozen yogurt brand identification until 1995. Just prior to the release of the latter, Ben & Jerry's suffered its first period loss and Cohen responded with resignation as CEO of the corporation.

The transition to Unilever was instigated by the entrance of Jostein Solheim, a 14-year veteran to Unilever in 2010, with the expertise of running its ice cream division operations in five countries, and principle to a new strategic plan for the partnership's North American operations directed at the roll out of new products (Hoovers, 2010). Co-founders Ben Cohen and Jerry Greenfield whom proffered the start-up in the 1970s, made this move toward Solheim with the belief that the life-cycle of the former enterprise could only be regenerated with his exceptional insight into the market. Ben & Jerry's currently retails product to regional markets in Asia, Europe and North American, as shown in the list of countries in Table 1.

Table 1

Countries of Operation

Aruba

Belgium

Canada

Cyprus

Denmark

Finland

France

Germany

Hong Kong

Iceland

Ireland

Israel

Malta

Mexico

Netherlands

Portugal

Singapore

Spain

Sweden

Switzerland

Thailand

Turkey

UK

US

Table 1. Countries of Operation, Ben & Jerry's (Hoovers, 2010).

When purchased by Unilever in 2000 for approximately, $326 million the Ben & Jerry's deal was structured to allow the ice-cream maker to continue its brand identity marketing strategy based on social missions, and to the inclusion of both co-founders whom offer oversight and lend personal image to the product. The Unilever market position is described in the financial overview in Table 2.

Table 2

Financial Overview

Unilever, Ltd.

Private Headquarters

Fiscal Year-End

December

2009 Sales (mil.)

$2,814.7

1-Year Sales Growth

(13.2%)

2009 Net Income (mil.)

$220.0

1-Year Net Income Growth

3.0%

Table 2. Unilever financial overview, 2009. (Hoovers, 2010).

In spite of the influx of investment and strategic leverage to logistics and visibility promoted by the relationship with Unilever, as the company disaggregated, control over activities was less coherent. Identity management issues have plagued the company image in the last half decade. In 2006, Chief Financial Officer (CFO), Stuart Wiles was convicted of embezzling $300,000 from the company during his tenure at Ben & Jerry's, from May 2000 to May 2004 (Hoovers, 2010). Poor partnership control also ensued, and the same year marked the end to the Michael Foods egg supplier relationship in response to public pressure over the inhumane treatment of its chickens.

Resource operations management is guided by Ben & Jerry's "Values-Led Sourcing" (VLS) program. The initiative involves ingredient supplier stakeholders in support of ethical management of natural resources, and economic opportunities for disadvantaged workers. Steps taken in achieving a Values-Led Sourcing program include the following measures articulated as what 'We' did in Table 3:

Table 3

We began the transition of our United States pint packaging to Forest Stewardship Council (FSC)-certified paperboard;

We added Chocolate Macadamia, a new flavor with Fair Trade/Fairtrade ingredients to our global line up;

We brought all of our European dairy purchasing into the Caring Dairy program;

We accelerated the transition to using only cage-free eggs in our U.S. supply chain;

We also made several commitments to grow existing VLS programs over the next several years, including a plan to move to Fair Trade sourcing for all eligible ingredients across our global portfolio by 2013; and a plan to expand our Caring Dairy program in Vermont.

Table 3. Outcomes to the Ben & Jerry's Values-Led Sourcing program, 2009 (Ben & Jerrys, 2010).

Reporting on the program figures indicates that 40% of the raw material expended (i.e., ingredients, dairy, packaging) for North American production went to Values-Led Sourcing initiatives, up from 38% percent in 2008; and comparatively, in Europe, 53% from 42% percent in the same year (Ben & Jerry's, 2010). Completion of the Company's full scale-up of its Caring Dairy program in 2009 concluded the strategy to accelerate VLS across the board in the EU. Anticipation that VLS spend percentage should continue in the next several years holds import to the strategic marketing plan, as ambitious scale-up of several more VLS initiatives will fulfill press release and advertising goals.

Fair Trade suppliers are given priority where small-scale farmers from developing countries are involved in offering the highest quality ingredients. A global marketplace perspective within the Company's business strategy translates to a voice of social justice in support of partners and the sustainable growth of the company's long-term stakes in planetary peace. Marketing of this message is readily achieved through articulation of alignment with small entities vested in fair trade activities, and through brand identification of the corporation's FairTrade logo; assurance that farmers who grow key ingredients used in our ice cream are paid a fair market price in support of their sustained agreement to organized democratic work cooperatives in pursuit of environmentally sound farming practices (Ben & Jerry's, 2010). Free trade supplier partners involve public commitment to product ingredients discussed in the product storyboard in Table 4.

Table 4

The coffee extract we use in our coffee flavors in the United States (Coffee, Coffee Heath® Bar Crunch, Coffee Buzz Buzz®) is Fair Trade Certified and comes from the Huatusco Cooperative, in Veracruz, Mexico.

The vanilla extract in Ben & Jerry's Smooth Vanilla and Chocolate Macadamia ice cream produced globally is made with Fair Trade/Fairtrade vanilla beans from farmers in India, Indonesia, Uganda, and elsewhere.

Ben & Jerry's Chunky Monkey® ice cream produced for the European market is made with Ecuadorian-grown and Fairtrade bananas from El Guabo Cooperative.

The cocoa powder in Ben & Jerry's Smooth Chocolate ice cream in the U.S. And Chocolate Macadamia ice cream around the world, and in the chunks and coatings for our European flavors Chunky Monkey® and Vanilla Toffee Crunch are Fair Trade/Fairtrade Certified, from cooperatives in the Dominican Republic and West Africa.

As it says right on the pint, all Ben & Jerry's Fairtrade flavors produced for the European market are made entirely with Fairtrade sugar, grown in Manduvira Cooperative in Paraguay. In 2009, these flavors included Vanilla Toffee Crunch, Chunky Monkey®, Chocolate Macadamia and Smooth Vanilla, and we'll be growing the list in the years to come.

Table 4. Ben & Jerry's free trade product storyboard (Ben & Jerry's, 2010).

Ethical consideration to business agreements is articulated in the Code of Business Principles offered by parent company, Unilever. Synergy with of Ben & Jerry's activist platform of identity management is expressed as: "continuous improvement in managing environmental impacts, safe and healthy standards for workers, and a firm commitment to human rights" in support of the Company's signatory to the U.N. Secretary General's Global Compact of 1999 (Ben & Jerry's, 2010).

SWOT Analysis

The SWOT (Strengths, Weaknesses, Opportunities, Threats) Analysis in Table 5 provides an organizational assessment to other Six Sigma approaches of strategic evaluation. Analysis of factors that might be factoring into execution of current value chain strategies, such as political, economic, social, technological and environmental (PESTLE) changes can be identified and put into depth analysis where the PESTLE formation shows up as a 'natural' phenomenon (Appendix A).

Table 5

Strengths

Solid brand identification

Longevity of performance

Large niche market with loyal customer base

Progressive vision ensures continuity in new market creed of "sustainable growth"

Conglomerate investment backing of parent company

Weaknesses

Perishable nature of food products means quality is always at issue

Slow response to market trends in product competition

Lessening control over retail operations

Idealism sometimes supersedes cost effective measures

Social responsibility now also the provenance of competitors

Opportunities

A host of countries where Ben & Jerry's has not yet been marketed

Product well received globally

Leadership in sustainable planning and social contribution

Established marketing platform recognized by consumers as an ice cream with a conscious

Threats

Scandals in the wake of decentralized control by owners

Shifts in supplier interests

Full cost price inputs where environmentally sound ingredients are part of the product promise

Competition product innovation

Table 5. SWOT Analysis of Ben & Jerry's market prospectus.

PESTLE analysis is undertaken in response to the SWOT analysis and assists to determine how to interpret facts and information discovered (RapidBi, 2010). Identity management assessment is readily facilitated using the environmental PESTLE instrument. Constructive to development of target market media analysis in both domestic and foreign markets, the tool is iterative in that it can be used over and over to deduce "pressure points" within international advertising and press content that may not be conducive to the sovereignty of a brand.

Ben & Jerry's as a subsidiary to Unilever holds a distinct position in the market of socially responsible food product lines. While some assert that the Company is a 'sellout' revenue and patterns of consumer loyalty to the product continue to support planning of strategic growth. The SWOT instrument encourages organizations to make educated decisions about everything from accounting to training. A source of 'ethnographic data' findings to the assessment can then be used in original qualitative form, or inserted into larger quantitative narratives to add depth in 'company-wide surveys' on the back end of the data collection experience.

Core competencies can be used in comparative analysis with market derived data on the about the company's strengths and weaknesses. Product life-cycle redefinition will be better optimized where holistic insights into portfolio performance provide an adequate picture about resource agreements and brand identity as an integral aspect of the value chain -- especially where issues of fiscal control and quality management are at stake within the current of operations in outbound logistics, marketing, sales and services.

Product innovation where perishables are concerned means that concept over shelf life provides 'value' to assessment of liquidity of Ben & Jerry's strategic business units (SBU). As seen in the widely publicized acquisition of the organization, what was profitable was an image -- based on a popular food product already tested in the global marketplace.

Objectives and issues

Three strategic objectives of Ben and Jerry's mission are catalysts to the Company's strategic plan in:

1. Product Mission -- "drives us to make fantastic ice cream -- for its own sake"

2. Economic Mission -- "asks us to manage our Company for strategic growth"

3. Social Mission -- "calls us to use our Company in innovative ways to serve the common good"

Issues based initiatives have served the organization from its inception. The Values-Led Sourcing companies, organizations and ingredients support the first objective to the Ben & Jerry's mission, Product Mission in realization of pure product ingredients. For instance, the St. Albans Cooperative, primary supplier of cream and condensed milk ingredients in the U.S. market is a Vermont Co-op of five hundred family farmers (Ben & Jerry's, 2010). Visibility in this area is articulated through joint pledge that cows that produce the milk and cream may not be treated with rBGH, a synthetic growth hormone. Aesthetic compliment to this ecological concept is embodied in the use of Forest Stewardship Council (FSC) Certified paperboard for Ben & Jerry's pint containers and lids.

FSC certification indicates that the forests where the pulp is derived are sustainably managed, including the protection of biodiversity, wildlife habitat, indigenous people's rights, and workers' rights. Commitment to social justice is part of the third objective, or Social Mission to Ben & Jerry's mission, and informs the total financial picture mentioned in objective two, Economic Mission. Social marketing by way of sustainable social issues agendas puts traditional media to the test of integrating thought provoking activism into the corporate marketing mix. As aforementioned, the human rights impetus to Unilever's EU-based stance as a conglomerate with obligations to the market of consumers it serves, Ben & Jerry's brings an American perspective to the table, and reiterates social consciousness as a critical step to planetary salvation.

The Ben & Jerry's Foundation is a nonprofit, charitable foundation that reflects the Company's overarching goals of "addressing the underlying conditions of societal and environmental problems" (Ben & Jerry's, 2010). In 2009, Ben & Jerry's Homemade, Inc. contributed $2,001,550 to its Foundation toward support of its funding priorities to: "1) help ameliorate an unjust or destructive situation by empowering constituents; 2) facilitate leadership development and strengthen the self-empowerment efforts of those who have traditionally been disenfranchised in our society; 3) support community movement-building and collective action" (Ben & Jerry's, 2010). Programmatic statement to the Foundation includes: Community Action Teams; Employee-Directed Grant-Making; National Grant Making; Multi-Year Capacity-Building Grants; and an Employee Matching Gift Program.

External projects supported by the programs in 2009 are reflected in contribution to Healthy Environment Alliance of Utah (HEAL Utah); Center for Immigrant Families (CIF); (Latino Union of Chicago); Community Asset Development Re-Defining Education (CADRE); and Battered Women's Resource Center -- Voices of Women Organizing Project (VOW's). The Technology! Project led to creation of a new website and online recruitment system. While small in scope, actions speak louder than words, and the advancement of technological interface with community projects at the Foundation offers immeasurable outreach significance associated with the Ben & Jerry's brand in the home market of the United States.

Marketing strategy

Marketing at Ben & Jerry's is about satisfying customer loyalty to the brand through recognized distribution channels and social responsibility sloganeering. Despite 'alternative' image, stakeholders expect conventional responsibility in public reporting of activities, and the Company's approach to new market entrance should be confirmed to investors. To this end, Ben and Jerry's have made public the outcomes to the organization's sustainability activities a moniker to the brand. Published in online compendium the Social and Environmental Assessment Reports (SEARS) has appeared for review since 2002. Prior to 2002, the company produced a legacy document to the SEARS Report, in the Coalition for Environmentally Responsible Economies (CERES) Environmental Report.

Targeted consumer marketing strategies, including print advertising and product visibility in media is largely managed by Ben & Jerry's marketing staff. Store distribution, however, handled by Dreyer's on behalf the company as a subsidiary to the shared parent corporation, Unilever. Aside from strategic ad placement in known consumer niche readership (i.e. Utne magazine), Ben & Jerry's media campaign appears like a political junket, running interference at designated events like rock-n-roll festivals dedicated to 'alternative lifestyle' consumers. Candidly, consumer loyalty is much broader, however, and the longstanding richness of this specialty food item is truly American family fare available to consumers nearly everywhere. Plain talk taken from online customer satisfaction surveys and auditor opinion commentaries fills in the narrative of Ben & Jerry's rather unassuming, Social Mission Campaign & Flavors strategy.