Download - Great Harvest Bread Company Marketing Plan
Great Harvest Bread Company Marketing Plan
MBA 643 Marketing Management
Prepared By: John Keeney
Charles Hayes
Joseph Slocum
Cassidy Glebavicius
December 16, 2015
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Table of Contents
Executive Summary 3 Background
Situational Analysis 5 Customer Company SWOT Analysis Context Collaborators Competition
Market Analysis and Strategies 10 Potential Customer Survey Data Positioning StatementTactical Plans 13
ProductPrice PlacePromotion
Conclusion 17References 18
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Executive Summary
This marketing plan was put together to analyze Great Harvest Bread Company
and develop new changes that the company could make to improve business and
increase revenue. Great Harvest is located in the heart of Fairbanks at the Bentley Mall
shopping center. The owners, Eric and Tricia Cray, have been in business since August
of 2012. The store specializes in making different flavors of bread from a basic loaf of
wheat bread to other tasty breads like Cinnamon Chip and White Cherry Chocolate
bread.
During our research we found that Great Harvest has a large number of loyal
customers who help keep their business operating, but their customer base is relatively
small. Customers are loyal to our company because the product is simply that good, but
in the business world your company must continuously keep changing and expanding to
keep up with your competition. Depending on our loyal customers to make routine
purchases will eventually make our business stagnant. Instead, new ideas and solutions
need to be established to fix our company’s problem.
Our research showed us that 60% of Great Harvest’s customer base is made up
of middle aged women between 30 and 45. This group of consumers also makes up
roughly about 75% of Great Harvest’s loyal customers. A loyal customer is defined as
someone who makes a purchase in our store at least once a week. Having this
information, we determined that our company could expand its customer base by
targeting demographic groups outside of middle aged women. Our research and
surveys showed us that military personnel and college students make up over half of
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the Fairbanks city population. Also, out of military, students, and people not affiliated
with either, military personnel and students regularly eat out twice as much. The military
group and student segment chose E-mail and social media as the best way to inform
them about promotions and new products.
Recommendations:
· Increase product awareness
· Target military market and college students
· Improve presence on Facebook and Twitter
· Send out a weekly newsletter including what breads are offered and any
purchasing discounts
Background
Great Harvest Bread Company Fairbanks is part of a bread making franchise
originated in Great Falls, Montana. In 1976 the first ever Great Harvest Bakery was
opened in Great Falls. Today, there are over 300 Great Harvests nationwide. One of the
important aspects about Great Harvest is that it is not a typical, strict franchise like most
large and successful businesses. Instead, the company works with a loose or freedom
franchise where owners have the freedom to make changes to the menu and offer
goods that other stores around the country might not offer.
The Great Harvest Bakery in Fairbanks is owned by Eric and Tricia Cray. The two
owners opened the store in August of 2012 and have enjoyed success with their
business. Tricia says they decided to start their business after attending a convention in
Anchorage where they found out they could open their own after following a few easy
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steps and requirements. Since opening, their store has seen some success but their
sales have not grown much in the past year. Our marketing plan will analyze the
company and offer recommendations to help Eric and Tricia increase the store’s
revenue and improve their business.
Situational Analysis
Customers
The customers of Great Harvest Bread Company in Fairbanks, AK are typical
from what you’d expect in a specialty bread bakery. Both through our observation, our
surveys, and with speaking to the owner we learned their typical customers are middle-
aged and older, female, and are not especially price sensitive. The higher age of the
customers is indicative of greater disposable income and likely being more health
conscious. That will make them more likely to pay for the quality offered by a specialty
shop such as Great Harvest Bread Company. The fact that more of their customer base
is female is simply a reflection that women do slightly higher percentage of food
shopping than men. We also learned that their customer base is a comparable mix of
those that just focus on the specialty breads or only shop for special occasions and
those that purchase bread there for their everyday bread usage.
Company
The strengths of Great Harvest Bread Company all revolve around how they set
themselves apart with a quality product and quality service, both to the customer and
the community. They build their image on their unique and high quality breads. Using
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only high quality ingredients they make a range of choices from simple wheat bread with
only five ingredients to seasonal and unique artisan creations. In their case, the product
speaks for itself. This is evident in their bread board where you can get large sample
and also with their desire to donate on a large scale. The donations are partially a tactic
to get their bread out to more people, but it also a reflection of their strong values in
providing the best possible service to their customers and the local community. Another
way they build on their business is through their add-on products. Given the fact that
they make great bread it wasn’t a large jump to make good sandwiches, and they also
built upon their use of simple quality ingredients to build an extensive list of artisan
breads and sweets.
However, in their business there are some weaknesses that present difficulties in
their growing success. Being relatively new to the area, there are still many people to
either aren’t familiar with Great Harvest Bread Company at all or don’t know about the
one here in Fairbanks. Another challenge with any small business like this one is the
difficulty in finding and retaining good employees. This is hard on an owner that has to
then do more of the labor themselves when they should be more able to look over the
business and try to manage costs which are quite high for this shop due to the need to
have staff working late at night and early in the morning. Additionally, rent at this
particular location is very high. Another challenge for Great Harvest Bread are the
limitations placed by the franchise often limiting the product line for newer franchise
locations. These challenges combined with the cost of their quality ingredients push
specialty shops like these to have to charge high prices.
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In their attempt to overcome or circumvent these weaknesses, Great Harvest
Bread Company will have to take advantage of some opportunities outside of just their
internal working. For example, there are large military and university related populations
in the area that regularly conduct events of all kinds ranging from sporting and service
events, speakers, and social gatherings. These are great options to present their
product to a larger concentrated audience. Another method would be to continue to
expand upon their community exposure. They already use a lot of donations and appear
at numerous events. However, there is still much opportunity to grow. Specifically, a
booth at events such as the Farmer’s Market, the fair, and events at the Carlson Center
such as the outdoor show, craft show, gun shows, etc. This would get their quality
product in front more people, especially male customers. Another platform where Great
Harvest can potentially benefit is through social media. They already have a good
Facebook presence, but this could grow and include more forms of social media such
as Instagram, Twitter, or Pinterest.
The external threats of concern for Great Harvest Bread Company include diet
trends, supply costs and the unique challenges that are part of being a business owner
in Fairbanks, AK. As a food service provider, they are at the mercy to any diet and
health trends. This is of particular attention with respect to Gluten and carbohydrates.
Additionally, given that Great Harvest uses few ingredients from few suppliers, they are
always at risk of changes in costs of ingredients. Finally, the location of Fairbanks
brings the challenges of bad weather in the winter, extensive road construction in the
summer that could limit access, and seasonal changes in population and income levels.
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Context
Analysis of the context of the business of Great Harvest Bread Company begs
the question of what is going on in the world. These issues stem from big picture
concerns such as politics, the economy, social factors, and technology. For Great
Harvest to succeed, they have to be in an environment where there are enough
customers, they have the disposable income to purchase these specialty breads, and
they must want and believe in the quality and value of the product.
A large percentage of the Fairbanks community is part of the military (roughly
30% of jobs and 38% of wages). In a community like this there are always concerns of
the changes in military personnel. For example, Eielson Air Force Base is likely to
receive a new squadron of aircraft bringing new people to the area. By contrast, there
has been talk on more than one occasion of downsizing Fort Wainwright which would
result in the loss of thousands of personnel. Beyond the risk of downsizing, a major
deployment of military personnel to any overseas conflict would at least temporarily also
bring similar reductions to personnel.
Another large part of the Fairbanks and Alaska economy revolves around the oil
industry which is currently experiencing a collapse in the price of oil. The loss of this oil
money is pushing Alaska’s economy towards a recession. Likely outcomes include
unemployment and reduction or elimination of the Permanent Fund Dividend, or PFD’s.
This downturn in the economy and level of disposable income could have an effect on
specialty businesses such as Great Harvest.
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Outside of the economic factors, customers also have to believe in the value they
receive from Great Harvest Bread Company. As part of this, Great Harvest has to
continue to have access to the best ingredients to continue to make high quality breads.
Again, they achieve this quality as a result of using few simple and high quality
ingredients. This becomes important if there is a shortage of one of their ingredients
such as an egg shortage this year. Also, a risk of their choice to use only wheat from
Montana, they are at the mercy of the global markets that price the wheat and more
significantly mother nature. There are various concerns over insect infestations in this
region, and with it being just this one region, a shift in weather patterns resulting from
climate change will have an effect on the quality of wheat that can be produced. Another
part maintaining the value of the breads sold at Great Harvest is the reputation and
image of the company. As technology and social media becomes a more integral part of
our society, more and more local businesses can benefit or be damaged by these
platforms. Many people base their shopping choices on reviews and images that are
available online, and it only takes a few negative reviews to have a lasting impact on a
small business.
Collaborators
For good or bad, Great Harvest Bread Company has very few collaborators.
They use few ingredients from a very few suppliers. In fact, their most important
ingredient in obtained from other parts of Great Harvest Bread Company itself. The
company boasts that they take the wheat from the farm to the table. The wheat is
purchased from Montana farms and shipped to the franchise locations all controlled by
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Great Harvest Bread Company. With Great Harvest Bread Company of Fairbanks being
the end provider, they have no distribution channels outside of their own store.
Competitors
One of the things that make Great Harvest Bread Company in Fairbanks
successful is that no other competitors do exactly what they do. Their only competition
include other sources of bread such as Fred Meyer, Safeway, and Lulu’s Bread and
Bagels; and other places for lunch such as Brueggers next door, Speedy Subs,
Chowder House and other choices in the area.
Market Analysis and Strategies
While looking at Great Harvest Bread Company's segmentation, targeting, and
positioning we took a look at their potential customer survey data, main competitors, a
competitive analysis, and their positioning statement.
Using the information we gathered from our survey we looked at three primary
groups: military, no affiliation, and students. These are the groups that we perceive to
be the three main segments in Fairbanks. One of the first questions we looked at with
these three segments is how these segments prefer to receive their information. For
students we found that Facebook is the best way to reach their segment, for no
affiliation it was radio, and for the military the best way to reach them was through e-
mail.
Collectively we found the best way to focus and reach all three segments was
through E-mail. We felt that a good strategy to reach out to people was through either a
weekly or monthly newsletter. This allows Great Harvest Bread Company to reach out
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to repeat customers and offer information on new breads they are serving as well as
offering discounts or promoting events.
The next area we looked at in our data was which of the three segments was the
most important for us to reach out to. In order to do this we surveyed to see how often
people in each segment eat out per week. It doesn’t make any sense to spend a lot of
effort and money to market towards a group that doesn’t tend to eat out anyways. We
found that the majority of students and no affiliation tend to eat out between 1 and 3
times per week, the military we surveyed tended to eat out between 4 and 6 times per
week.
Of the 30 surveys we had in each group, 47% of military eat out between 4 and 6
times per week, no affiliation 67% ate out between 1 and 3 times per week, and 50% of
students ate out 1 to 3 times per week. This shows that all three groups make sense to
target as only 13% of each group reported they don’t eat out at all. The military is the
best target segment but only by a mild margin, military also tends to be closer in
location to Great Harvest Bread Company because of how close it is to base.
Great Harvest Bread Company has a lot of room to reach into new markets. Of
the 30 people surveyed in each segment 83% of military have been to GHBC, and 23%
of students and no affiliation have been. This means a lot of students have not been to
GHBC which could be a result of location. A good way to reach out to more students
would be to create a stronger Facebook presence, 44% of UAF students said their main
way of getting information was through Facebook.
Great Harvest Bread Company doesn’t have a ton of competition in the local
area, but some of their main competitors are LuLu’s bagels, Fred Meyer, and Safeway
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bakeries. GHBC is more of a specialized product rather than being an everyday grocery
store (Safeway/Fred Meyer) or a breakfast bagel/bread shop. The most similar in
comparison with Great Harvest Bread Company is Safeway or Fred Meyer’s.
Looking at the three main competitors with Great Harvest Bread Company we did
a competitive analysis using the variables of price, location, and selection. There wasn’t
a huge different in price but Great Harvest Bread Company is slightly more expensive
than its competitors. When we looked at location it was hard to really compare the
competitors because LuLu’s is close to campus and Great Harvest Bread Company is
closer to the military base, Safeway and Fred Meyer’s both have two locations with one
being by base and the other by campus giving them both an advantage on location
Safeway and Fred Meyer’s lead the way in selections, most of these breads are
considered your everyday bread versus LuLu’s and GHBC which are more specialty
breads.
Great Harvest Bread Company has created their own positioning statement,
which says “We believe our success comes from a strong commitment to uphold the
legacy and integrity of the Great Harvest Brand. Great harvest is about customer
experience and the promise of phenomenal tasting products made with freshly milled
whole grain and pure and simple ingredients”. This is a strong statement, which shows
Great Harvest Bread Company’s main goal is to provide health conscious, natural bread
for its customers without sacrificing taste. This determines their target segment as
anyone looking for a healthy way to still enjoy bread.
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Tactical Plans
Product
Brand is an important aspect of a company’s product, especially in the case of
Great Harvest Bread Company. Brand associations are characteristics which come to
mind when a consumer hears the brand name. Brand associations follow a hierarchy; at
the top are basic product attributes, then product benefits, and finally emotional
benefits. Product attributes that are immediately associated with the Great Harvest
brand are bread and great quality. Product benefits attributed to the brand are that their
products are great to bring to social gatherings such as parties or dinners. When a
person is trying to think of what to bring to a church gathering or potluck, the Great
Harvest brand may come to mind due to brand associations of product benefits.
Emotional benefits are what connect brand to consumer on a personal or unconscious
level. These are the feelings associated with the brand such as positive social
interaction or developed interpersonal connections with the Great Harvest Bread
Company brand.
Brand personality characterizes the brand as a whole. It personifies the brand
collectively based on the marketing mix and experiences with the company. Great
harvest has a reputation for being charitable and community oriented, and therefore
possesses a sincere brand personality. Employees frequently greet customers in a
friendly manner and give their undivided attention when interacting with others. The
owners are active in the community and interact with customers also. All of these
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actions and characteristics make for the sincere brand personality of the Fairbanks
Great Harvest Bread Company.
Brand strategy describes how a company brands their product offerings. Some
companies will have multiple brands in order to carry different associations with each
product line. Great Harvest utilizes umbrella branding. This strategy places the same
brand name on all of the products the firm sells. Everything sold by Great Harvest
carries that brand name.
Goods and services determine the firm’s product structure. Great Harvest
Bread Company’s product structure lies closer to the goods side of the continuum, but
also covers some aspects related to services. Products sold by Great Harvest are
tangible and standardized by following a recipe, which are characteristics of a good.
Characteristics that shift nearer to the service side of the product continuum are the
experience and perishability of Great Harvest Bread Company products. The breads
sold are produced daily and should be consumed within one week of purchase, so
these products are perishable to an extent. Consumers must also experience the
product to determine the quality. Unlike goods, one cannot simply look at the bread and
know the high quality or taste. All aspects considered, the Great Harvest Bread
Company products are considered goods, but also have some characteristics of
services.
Product offerings include a company’s core market offerings and value-added
offerings. The core market offerings are essentially the main products sold by the firm,
or what their focus is. The core market offerings for Great Harvest are bread, healthy
ingredients, and quality. The added-value offerings include items such as drinks, food,
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catering, gifts, friendly service, and seating for customers. These are all additional
benefits offered to consumers that are received as “extras” to their core market offering.
New Products are important to companies because they intrigue consumers and
retain interest from existing customers. New products are effective for Great Harvest
because the company is in the growth stage of the product life cycle. In this stage the
company is known but trying to expand and grow the business. The effect of new
product offerings on the life cycle can be extremely helpful because they add energy to
the company and promote growth rather than stagnation. Great Harvest has many
options for new products, but a convenient alternative are seasonal offerings. This
creates a similar energy as new products when integrated into the system but contains
less risk.
Price
Great Harvest Bread Company utilizes a diversified pricing strategy. They
consider cost pricing but because the costs associated with their products are
excessive, they must charge higher end prices for their product. This situation forces the
company to look also into what customers are willing to pay for their product. The
demand is inelastic and their customers are generally very brand loyal, which allows
them to charge higher rates than their competition. The high price point also exists due
to the actual quality differences and rarity of their product. The company does offer
quantity discounts in the form of punch cards, as well as sales sometimes for
consumers who may be more money-conscious.
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Place
Great Harvest Bread Company has many distribution channel strategies. There
are some aspects of backward integration in the channels such as the employees both
milling wheat in the store and baking all of the breads every day. In other aspects they
do utilize suppliers such as purchasing Montana wheat, eggs, and other staples from
manufacturers. The franchise connects local stores to partners within the supply chain,
providing a smooth transition.
Promotion
Marketing goals consist of three steps: cognition, affect, and behavior. Great Harvest
lies between the cognition and affect goals. Cognition is the goal to promote awareness
of the company and provide consumers with information. Great Harvest is still a
relatively new local firm and therefore continues to try developing awareness through
various mediums like trade shows and presentations. Affect is the goal to increase the
likeability of their products for consumers. Great Harvest is working on this goal by
providing samples to the public and emphasizing the high quality of their breads.
Great Harvest Bread Company uses a pull strategy in their promotions. The owners
attend trade shows and offer free samples because they are confident once customers
have tasted their product, it will “pull” them to the store and result in sales. They also
announce discounts on Facebook and social media, and rely on word of mouth from
brand loyalists to pull more customers into the store.
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Conclusion
Great Harvest needs to focus on increasing product awareness and their customer
base. Their products speak for themselves and the franchise has been successful for
almost 40 years. However, to experience growth and increase sales Great Harvest
should focus on attracting new customers first while still satisfying their loyal shoppers.
The military segment and student segment are two primary groups that the company
should target with promotions and product information. The best way to reach these
groups would be organizing a weekly newsletter that is sent out to invite people in the
store and offer discounts after making purchases. Also, increasing their updates on
social media like Facebook and Twitter will increase product awareness for Great
Harvest.
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References
Eberhart, John (2015 August 27) Military Matters to Fairbanks. The News
Miner. Retrieved from www.newsminer.com
Iacobucci, Dawn (2013) Marketing Management. Mason, OH: Cengage
Learning
King, Jonathan "Alaska Economic Outlook 2015." Presented with World
Trade Center Alaska. February 3, 2015.<http://fairbankschamber.org/
wp-content/uploads/2015/02/2015-Economic-Outlook_Jonathan-
King.pdf>
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