Kate Banser

Hannah Brillowski
Sara Rammer
Ashley Tobalsky

FN 448 Marketing Research Project

Situational analysis
Specialty coffee drinks are in their first year of implementation. Currently
sales are below desired. Promotion of coffee drinks will increase demand.

Market Summary– The target customers were researched and the market was
studied. This gives a sufficient background for understanding the specific likes and
dislikes of the customers as well as how to communicate with them.

Market Demographics:

Geographics: Building of College of Professional Studies and surrounding

academic buildings.

Demographics: Students and faculty from the geographics stated above.

Behavior Factors: Customers may be reluctant to purchase unfamiliar

product.
– Customers may be unaware of new specialty coffee drinks
offered.
– Customers may be unaware of details and how to order
specialty coffee drinks.

Market Needs:
Specialty coffee drinks offered in the CPS café provide the customers with
convenience throughlocation. The specialty coffee drinks meets the needs of
the customers who demand high quality organic coffee.

Market Trends:
National trends reflect increased demand for readily available, high quality,
fairly priced coffee drinks. An example would be the addition of specialty
coffee drinks to the McDonalds menu.

Market Growth:
Specialty coffee sales are increasing by 20% per year and account for nearly
8% of the 18 billion dollar U.S. coffee market (http://www.e-
importz.com/Support/specialty_coffee.htm).

Industry Analysis and Distribution:

The products being promoted are the specialty coffee drinks including lattes,
mochas, cappuccinos and espresso drinks.

The success of the café is due to the novelty of the products being offered. They
are high quality, local and/or organic.
 Kate Banser
Hannah Brillowski
Sara Rammer
Ashley Tobalsky

Marketing Analysis:

In the past, sales of coffee and baked goods in the CPS Café have been strong.
Specialty coffee drinks were recently introduced with no marketing attempts,
resulting in lower than desired sales. The raw cost of specialty coffee drinks is 17%
of their sale price, making these drinks one of the highest profit margin items in the
café. Advertising and promotion of specialty coffee drinks will therefore increase
sales and ultimately profit for the café.

SWOT Analysis:

Strength- Our promotion is placed in an existing food operation, therefore we

will not be starting from scratch.

-High quality, organic product

Weakness- Increased labor and skill requirements of employees.

Opportunity- Established regular and consistent customer base.

Threats- Decreased spending due to recession in the economy.

Competition: Food for Thought café, Basement Brewhaus, Home Grown Café,
Starbucks and McDonalds.

Products Offered: Specialty coffee drinks including lattes, mochas, cappuccinos and
espresso drinks. Seasonal coffee cake with purchase of specialty coffee drinks.

Critical Issues: Price coffee cake low enough to produce an incentive to buy
specialty coffee drinks in order to ultimately making a profit.

Marketing Strategy
Mission: The CPS Café provides dietetics students at UWSP the opportunity to
experience all aspects of foodservice operation and management. The Café offers
the best natural and organic foods sourced from sustainable local farms and uses
green-sustainable practices in operation. The Café features fair trade coffees and
bakery from scratch every morning.

Marketing Objectives:

1. To generate increased awareness of specialty coffee drinks offered at the

Café thereby increasing sales.
2. To further increase specialty coffee drink sales by offering free coffee cake
with purchase.
 Kate Banser
Hannah Brillowski
Sara Rammer
Ashley Tobalsky

Financial Objectives:

1. To increase specialty coffee drink sales to at least 25 per day, which would
provide a $51.25 per day profit. This will provide a daily increase in profit of
$11.25 per day in specialty coffee drink sales.

Target Market:

The CPS will market specialty coffee drinks to:

1. Established CPS Café customers.

2. Faculty, staff, and students of the CPS and surrounding academic buildings.

Positioning:

The CPS Café will position itself as the premier on-campus specialty coffee and
from-scratch baked goods source for faculty, staff, and students of the CPS and
surrounding academic buildings. To achieve this positioning, the Café will leverage
its competitive edge.

∙ The Café will offer affordably priced specialty coffee drinks.

∙ The Café will offer the incentive of free freshly baked, from-scratch coffee
cake with purchase of a specialty coffee drink.

Strategies: Our strategies towards increasing the sales of the specialty coffee drinks
is to design and create posters which are conceptually clear and attractive. These
posters will be put up around campus. We will put these signs in areas our
customers view daily, such as the menu board next to the brewed coffees and next
to the hours posted. Since our target audience is faculty and students in the CPS
building, we will be encouraging the flow of word of mouth advertising.

The message communicated will be that our coffee is of premier quality and that we
will offer a complimentary baked good with purchase as incentive.

Marketing mix:

Pricing: The discount on the baked good is designed to sway the customer into
trying our specialty coffee in order to convince them of its superior quality.

Distribution: We directed our marketing efforts all around campus to bring

customers in from other buildings, which will ultimately increase our coffee sales.

Advertising and promotion: Signs and posters will be the bulk of advertising, with
ads in the Pointer and Student Message of the Day as well.
 Kate Banser
Hannah Brillowski
Sara Rammer
Ashley Tobalsky

Customer service: The CPS Café staff will be trained and efficient in making the
specialty drinks. If the demand is high enough, there will be an additional runner for
the beverage production and bakery restocking.

Marketing Research:

Due to the recent implementation of the specialty coffee drinks , we realize the
necessity of promotion to increase awareness, thus increasing sales.

Financials: This section will offer a financial overview of our specialty coffee
promotion as it is related to the Café’s current sales reports. Break-even analysis,
sales forecast, expense forecast, and how they link to the marketing strategy will be
addressed.

Break-even analysis:

Known- For the seasonal coffee cake recipe chosen the cost will be $.45 per
piece (1/9th of 9in square pan). This includes a 60% labor cost.
The raw cost of the specialty coffee drink ingredients per cup is:
Espresso= $0.183
Flavored syrup= $0.245
Whipped cream= $0.016
Milk- small (7oz)= $0.317
Large (11oz)= $0.498
Chocolate syrup= $0.031
Cost of drinks ranges from $1.89 to $3.50 and the profit per drink ranges
from $1.60 to $2.56.
Assumptions- Current average sales of specialty drinks is about $47.76 per
day. (This is based on average 16 drinks sold with price equivalents to 8 small
cappuccinos and 8 large cappuccinos.)
When our goal is reached the daily average sales of specialty drinks will be
$74.77. (This is based on our goal of 25 drinks sold with price equivalents to
12 small cappuccinos and 13 large cappuccinos.)

Sales forecast:

Sales forecast for 2009/2010: Goal is met by the month of November and
maintained, however due to class scheduling and the café being closed more
in certain months, we see an unsteady trend.

Expense Forecast:
 Kate Banser
Hannah Brillowski
Sara Rammer
Ashley Tobalsky

Recurring Monthly Costs:

1. Coffee Cake Ingredients:
.45/slice

2. Specialty Coffee Drink Ingredients:

Espresso: $ 5.87/lb
Syrup: $10/25.5oz
Heavy Cream: $1.55/qt
Milk $5.80/gallon
Chocolate Syrup $2.00/pt
One-time advertising costs:

One-time advertising costs: $10

Implementation:

May: Meet with Marty Loy, Kim Beckman, and Jasia Steinmetz to pitch marketing
campaign and receive feedback

June: Test coffee cake recipe with various seasonal products for consistent product
quality and affordable costing.

July: Begin designing advertisement signs to post within CPS and surrounding
academic buildings. Order signs to be placed prior to start of academic school year.

August: Purchase ingredients for coffee cake and specialty coffee drinks. Hold
training 1 week prior to Café opening to teach employees how to prepare coffee
cake and to ensure employees are proficient at specialty coffee drink production.

September: Implement Marketing Campaign on opening day of Sept 2009.

 Kate Banser
Hannah Brillowski
Sara Rammer
Ashley Tobalsky

Any Fruit Coffee Cake Recipes

1 1/2 cups of Peeled and Chopped Fruit
(could be apples, pears, cranberries, blueberries or just about anything else)
3/4 cup of Sugar
2 tbsp of Cornstarch
1 1/2 cups of Flour
1/2 tsp of Baking Powder
1/4 tsp of Baking Soda
4 tbsp of Canola Oil
1/4 Cup Water
1 Egg, beaten
1/2 cup of Buttermilk
1/2 tsp of Vanilla
½ tsp of salt

Toppings:
1/3 cup of brown sugar
1/3 cup of flour
¼ cup softened butter
1 tsp cinnamon

Preparing the Cake:

Preheat oven to 350 degrees. Lightly grease a 9x9 or 8x8 inch cake pan.

Combine your choice of fruit and 1/4 cup water in a pan and bring to boil. Reduce
heat and simmer until tender. (Note that some fruits do not need to simmer very
long or at all to become tender.)

Next you should combine the cornstarch and 1/4 cup of the sugar in a bowl. Slowly
stir this mixture into the fruit. Allow it to cook until it is thick and bubbly stirring
often. Let it cook for a couple of minutes more and then set it aside.

Combine 1/2 cup of the sugar, 1 1/2 cups flour, the baking powder and baking soda
in a bowl and mix well. Add 4 tbsp of olive oil until it is well mixed. Combine the
egg, vanilla and buttermilk in a separate bowl and then it add it to the flour mixture.
Stir just until it is well moistened.
 Kate Banser
Hannah Brillowski
Sara Rammer
Ashley Tobalsky

Spread half of the batter in the cake pan. Carefully spread the fruit mixture over
batter. Place the remaining batter in small mounds on top of the fruit filling.

Combine the 1/3 cup brown sugar, 1tsp cinnamon and 1/3 cup flour in a bowl and
then add ¼ cup softened butter in chunks and cut into dry mix. Sprinkle over batter.

Bake at 350 degrees in the oven for 40 to 45 minutes until it is golden brown.

Recipe courtesy: GourmetCoffeeShop.net and modified by Ashley Tobalsky