Case Study

By:

Cherry-lyn Apuada

Kristine Versoza

Naume Zamora

I. The Company

Godiva Chocolatier, one of the creators of the world's most elegant,

hand-crafted chocolates, originated in Brussels, Belgium. For

generations, Belgium has had a tradition of perfectionism, from its

Rubens paintings and gothic architecture to products made of intricate

lace, glittering crystal and its fabulous cuisine.

a. History

1920’s- Godiva Chocolatier traces its roots to 1926, when

Pierre Draps started making chocolates in Brussels,

Belgium, for sale to local shops. His son

Joseph began working for the family business at the

age of 14 and shortly after World War II took control

of it. When he decided to open a shop of his own, he

sought a distinctive name to give it and turned to

his wife for ideas. She suggested Godiva, after the

legendary countess who had protested high taxes by

riding nude through Coventry, England.

1958 - The first Godiva boutique outside of Belgium was

opened in Paris on the fashionable Rue

St.Honore’

1966 - Made its debut in North America at one of the

country’s most elegant department store

Wanamaker’s in Philadelphia, Pennsylvania.

1972 - First boutique in North America opened in New York’s

fashionable Fifth Avenue.

- Expansion continued in Asia. The first Godiva

chocolates became available in Japan in the

prestigious Nihonbashi, Mitsukoshi Department store

in central Tokyo.

1974 - Godiva was purchased by the Multinational Campbell

Soup Company.

b. Company Now

Since its introduction to America in 1966, Godiva continues to

be the leader in the premium confectionery category. Godiva

Chocolatier owns and operates more than 450 boutiques and shops

worldwide where consumers can find a comprehensive selection of

Godiva offerings. Godiva products are also available at finer

department and specialty stores. Additionally, the company issues

six seasonal mail-order catalogs a year in North America and

accepts phone and internet orders.

On December 20, 2007, Campbell announced that it entered into

an agreement to sell Godiva to Istanbul, Turkey, based Yıldız

Holding, which owns Ülker group, the largest consumer goods

manufacturer in the Turkish food industry. The acquisition was

completed on March 18, 2008, for $850 million.

c. Products

70% of Godiva paralines are machine made, and 30% are

handmaid

II. Positioning and Brand Image

Positioning (Godiva International)

“To adult who wants a quality product for special moments, Godiva is

an accessible luxury branded by Godiva Chocolatier and distinguished

by superior craftsmanship.

Brand Image

Godiva is associated as “most expensive”, “nicest

packaging” and “most beautiful store”

III. Problem

Godiva Europe is in the process of developing an advertising

campaign for Belgium but Godiva International is planning to create a

common advertising message for entire world.

IV. Constraints

a. Consumers do not perceive Godiva chocolates very different

from its main competitors.

b. Sales and naturally profits fluctuate seasonally

c. Godiva’s Belgian factory does operate at full capacity and the

U.S. factory produces a limited assortment of chocolates

d. Godiva chocolates are expensive and not suitable for self

consumption

V. Objectives

1. To differentiate Godiva as premium chocolates

and the luxury image to other competitors.

2. To increase the demand without damaging the

brand image.

3. Develop advertisement theme to entice

buyer’s of competitors product to switch to

Godiva brand

VI. SWOT Analysis

a. STRENGTH:

Global leader of luxury chocolates

Handmade chocolates

Dominantly in duty free market

Part of Campbell Soup Company.

Belgium factory has over 3000 tons of annual production

capacity

b. WEAKNESS:

Low market shares in European Market

Hight cost of production

High seasonality consumption and emphasis on freshness

Poor advertising channels

No Clear difference between Godiva and competition in the

minds of consumers

c. OPPORTUNITIES:

Growth in chocolate consumption

Chocolate are frequently used in different occasion.

Broaden the market on Duty free

d. THREATS:

Standard price due to European Union.

Huge gap to competitors in market shares

VII. Alternative Course of Action

1. Godiva Europe should wait for the Godiva

International advertising campaign to reinvent

the old fashioned of the entire Godiva.

2. Godiva Europe will pursue the advertising

strategy and use the additional 13 million bf.

3. Improved and reinforced Godiva European

distribution.

VIII. Relevant Information

a. Consumption

Industrial chocolates are sold in pre wrapped boxes with or

without brand names. The sales of generic boxes are stable in

Europe, while sales of brand boxes are increasing. The

consumers pay attention to brand names and to the quality

image communicated by chocolate packaging and advertising.

Chocolate consumption is higher in the northern Europe,

Switzerland had the highest per capita consumption as well as in

chocolate candies. Countries like Spain, Italy, and Japan are

susceptible to one day reaching such a level of consumption

roughly comparable to Switzerland, the United Kingdom and

Belgium.

b. Purchase Behaviour

1. Chocolates are offered at holiday and other

special occasions, and are eaten among friends

in an atmosphere of warmth.

2. The consumption of chocolate in all categories

is associated with pleasure. A qualitative study

of the Belgian Market shows that this pleasure

is associated with the idea of refinement, taste

pleasure, and gift.

3. Chocolate paralines are offered as a gift while

chocolate bars are purchased for self

consumption.

c. Consumer Analysis

1. Consumers pay attention to brand names and to the

quality image communicated by chocolate

packaging and advertising.

2. The higher prices of chocolate pralines with respect

to the other categories of chocolate do not inhibit the

consumer but limit more impulsive purchases.

3. The idea of health of a pure product devoid of

chemicals, is also in the consumer's mind

d. Trend

IX. Best Alternatives

Godiva Europe will put on hold their planning for new advertising

campaign for Belgium and consider the Godiva International new

objectives that will stretch out the entire Godiva internationally.

X. Plan of Action

Activities Person InvolvedYear 1 Aggressive advertising/campaign on

all special occasion Determine all the special occasion

aside from the regular occassions Create special boxes and ribbons

that are ready for gifts Personalize Section in every

boutique. Extend the use of handmade chocolate

Sales and Marketing Dept.

Year 2 Reinforce on the distribution on Duty Free market

Extend the market by supplying the upscale Department Store of Godiva Products

Maintain market presence by sponsoring some social events and advertisement in TV and Magazines

Sales and Marketing Dept.Operation

Year 3 Scrutinize on all the riches cities in the world. Developed a new Godiva Boutique on the potential cities(Feasibility and Marketing Plan)

Maintain market presence by sponsoring some social events and advertisement in TV and Magazines

ManagementSales and Marketing Dept.

Year 4 Put up a new Godiva Boutique on the potential city. (1 or 2 Boutique/s)

Aggressive ad campaign to penetrate the market. As well as on the different occasions

ManagementSales and Marketing Dept.

Maintain market presence by sponsoring some social events and advertisement in TV and Magazines

Year 5 2-3 New Boutique to Open on one of the richest cities in the world.

Aggressive ad campaign to penetrate the market. As well as on the different occasions

Maintain market presence by sponsoring some social events and advertisement in TV and Magazines

Customer Service to accommodate the growing customers.

ManagementSales and Marketing Dept.