Term Paper on "Marketing Plan Sweet Treats Coffee Shop and Bars"

Term Paper 18 pages (4922 words) Sources: 8

[EXCERPT] . . . .

Marketing plan: Sweet treats coffee shop & bars

Sweettreats Marketing Plan

During the recent years, the restaurants industry has been met with great increases in both demand as well as offer. And the coffee shop sector has not been an exception. With a constantly increasing number of coffee drinkers driven by numerous and changing demands, the industry has been forced to develop and adjust to the new requirements. A new trend within the sector is that of opening multifunctional stores, in the meaning that aside from coffee-based beverages, these stores also offer a wide selection of soft beverages and even food. These stores are being referred to as gourmet coffee shops and a new gourmet coffee store to be opened is Sweettreats.

The Sweettreats coffee shop and bar will be a new and innovative concept which will bring together and serve the needs of different target markets. More precisely, during day-time, it will welcome adults and their children. The adults will be able to enjoy a hot cup of coffee and chat with their friends, while the children play safely in the Sweettreats' playground. The main idea of the coffee shop is to create a new place with an extremely welcoming ambiance where customers can enjoy themselves. Unlike other coffee shops which sell their coffee-based beverages to go, Sweettreats will sell them to be consumed in the store, while relaxing in a pleasant environment.

At night time, the family-like place will turn into a social gathering spot for young single people and couples, which will be able to socialize and attend the concerts organized by the bar.

Before actually opening the store, the managers at Sweettreats will have to clearly analyze the market, the trends, the demands forwarded by customers as well as the strategies implemented by the competition. Also, the company will have to develop and implement a wide series of strategies focused around their core competencies and the main features which differentiate Sweettreats from its competitors and ensure its success.

2. Situation Analysis

The situation analysis is a vital first step in developing a marketing plan as it defines the background, the environment and the characteristics of Sweettreats which are likely to ensure its success or which are prone to pose difficulties. A first step in defining the environment where Sweettreats will conduct business is the highlighting of the target market. Then, a SWOT analysis is required, followed by an analysis of the competition and the factors which differentiate Sweettreats from its competitors and increases its chances of success.

2.1 Market Summary

In establishing the target market, the company has to look at the products and services it offers and then identify those individuals or groups of individuals who are likely to consume the Sweettreats products and services. In this order of ideas, the coffee & bar's primary audience will be formed from families and single individuals.

2.1.1 Market Demographics

The market of coffee shops is formed from numerous individuals coming from all sorts of backgrounds and registering various levels of income. "Seventy-seven percent of U.S. adults drink coffee daily and gourmet coffee consumption has risen in the past five years. Coffee bar patrons are younger, more affluent, and educated and are 22% more likely to be aged 18-24. They are also 65% more likely to have an annual household income of $100K+. Coffee shop patrons are 28% more likely than the average American adult to be single and 70% more likely to have a post graduate degree. The average age of specialty coffee drinkers is 43. Occasional latte devotees are in the higher average income of $76,000, and similarly, cappuccino and espresso drinkers reflect an average income of $60,000" (Holmes, 2004).

Given the dual character of Sweettreats coffee and bar, it is only natural for them to address two different types of consumers.

Demographics primary target market will be formed from young families with little children and who like to got out for a cup of coffee with friends. The individuals within this segment will be able to enjoy a nice morning or afternoon at Sweettreats, while in the same time having their children around, safely playing in the store's playground. This target market is basically formed from young parents between the ages of 25 and 40. It is also true that grandparents can join the family or can even go by themselves at Sweettreats, action encouraged by the coffee & bar, but they do not represent a primary target market, but an extended one.

The second target market will be formed from single individuals who are outgoing and enjoy a nice evening out in the company of other single individuals, while in the same time enjoying a concert organized by the bar. The main characteristic of this audience will be the age interval of 25 up to 50.

Geographics

Sweettreats will be located in highly populated metropolitan areas and will be extremely easy to access. As such, the geographics of the target market are rather insignificant. To better explain, given the central location of the coffee & bar, the customers can easily be the individuals living in the vicinity as well as tourists or people just passing by.

Other factors highly used segmentation criterion for identifying the target market is the income realized by the audience. But since the prices implemented by Sweettreats will be lower than those implemented by the competition and affordable by anyone, and the setting and serving conditions will be impeccable so to satisfy the most refined tastes, the financial criterion will not be used to segment Sweetreat's market.

2.1.2 Market Needs

The needs of the target market can be divided into two categories, according to each of the two identified audiences. As such, the first target market, formed from young families, presents the need for:

family-like and pleasant environment where parents and children can spend time together the possibility to meet friends hot coffee drinks, beverages and snacks for themselves and their children

The needs of the second target market can be summarized as follows:

place of social gatherings where they can spend their evenings in a pleasant environment and meet new people the need to relax and listen to concerts

2.1.3 Market Trends

Sweettreats activates in the restaurants industry, particularly in the coffee shops sector. This industry is highly dynamic and the major intent of the shops is to increase the loyalty of customers. And coffee shops generally do this by diversifying their product palette, customizing and personalizing the sold products based on the particular requirements of their clients.

Another trend in the market is given by the fact that coffee shops "have become establishments where people are not only drinking coffee but also surfing the Internet, working from their laptops, or communicating with friends, family, and colleagues. [...] Offering free wireless Internet in coffee shops is sure way to boost success. People are now given the option to make a connection over a cup of coffee and/or over the Internet" (Holmes, 2004).

2.1.4 Market Growth

The market of coffee shops has been met with significant increases during the past recent years. And so has the number of operating stores in the coffee industry. For instance, in 1989, the United States was estimated to host a total number of 585 coffee stores. By 2003, this number had increased to 17,400, revealing as such as increase of 2,874% in 14 years (Ferguson, 2004) particular domain which has seen major growth is that of gourmet coffee shops - segment where Sweettreats also activates. The market does however seem to have grown as much as possible, reaching now its maturity. "The industry is maturing, and coffee shops like Starbucks and Gloria Jean's may need to expand their target demographics and better understand the purchase motivators of away-from-home coffee drinkers in order to fuel growth in the coming years" (Dawidowska, 2002).

2.2 SWOT Analysis

The SWOT analysis conducted on Sweettreats emphasizes the internal strengths and weaknesses as well as the external threats and opportunities which could easily affect the future success of the coffee & bar.

2.2.1 Strengths

Sweettreats possesses sufficient financial resources to afford to invest in founding and developing the coffee & bar

Sweettreats possesses skilled, qualified and committed personnel which will support their development

The dual concept and multiple functioning of the store (coffee shop, playground, singles' spot)

2.2.2 Weaknesses

Stweettrates possesses no previous expertise with coffee shops

The multiple purposes of the shop could generate more expenses than initially estimated

2.2.3 Opportunities

An increase in the number of senior citizens who drink coffee outside their homes. "Seventy-five percent of Americans between the ages of 55 and 64 drink coffee out, compared with 47% of 18- to 24-year-olds. Considering that this age group is the fastest growing segment, thanks to Boomers, some coffee shops may want to reconsider their target market" (Dawidowska, 2002)

Gourmet coffee shops are increasing in popularity

2.2.4 Threats

Fierce competition from long established and internationally renowned coffee shops, such as Starbucks

The primary market targeted by Sweettreats… READ MORE

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