Marble Slab

Identification and Evaluation of Alternatives The following alternatives to Penny Thomas’s Marketing plan decisions incorporate aspects of Target Market, Store Location, and Promotional Campaign. Thomas’s alternatives contain: 1. Target Market a.

Families b. Young Adults c. Women 2.

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Store Location a. Vaughan b. Toronto Annex Area c.

The Beaches d. Oakville 3. Promotional Campaign a. Toronto Star b. Now Magazine c. 104.

5 Chum FM d. Pattison Outdoor e. Canada Post Direct Mail Pros & Cons 1. Target Market a. Families – Pros i. Parents were often engaged in family activities ii.Showed great potential with children under the age of 15 iii.

Often shared quality time during family outings including eating ice cream iv. Children often persuaded families to get ice cream as a treat – Cons i. Economic outlook was uncertain due to US economy effect on Canada ii. Since Marble Slam ice cream was that of a premium, might engage in lower quality products iii. Alternative options such as Baskin Robbins might appeal to families b. Young Adults – Pros i. Aged 15 to 24, had some of full independence of spending money ii.Own disposable income due to part time, full time, or summer employment iii.

Shares an appetite for social interaction iv. Limited family obligations – Cons i. Many competitors already targeting this lucrative market c. Women – Pros i. Primary caregivers and dominant grocery shoppers ii.

Made most of the food purchasing decisions in and out of the household iii. Profitable potential since this target market is so large – Cons i. Generally more health conscious ii. Unsure if target market would response favorably iii.Concern with how to focus advertising to such a broad segment 2.

Store Location a. Vaughan – Pros i. Growing population and increasing development ii. Pre-existing outdoor complex in Thornhill community iii. Located next to major urban highway and big name retailers including bank iv. Across from major shopping centre and movie theatre – Cons i.

Commitment to a 10 year term ii. Close proximity to Starbucks and Baskin Robbins b. Toronto Annex Area – Pros i. Large university student population in a densely populated area ii.Close to a major shopping street, guaranteed heavy traffic from neighboring stores iii.

Within proximity of several subway stops and walking distance from University of Toronto and several museums – Cons i. Finding a prime space in this area would be difficult ii. Leasing option would be most expensive among alternatives c. The Beaches – Pros i. Popular destination, well known for its sandy Lake Ontario shoreline and boardwalk ii. Heavily frequented by locals as well as tourists iii.Easily accessible by public transportation iv. Several dinning, shopping, and beach activities within proximity – Cons i.

Affected most harshly by winter weather ii. Five direct competitors within the vicinity d. Oakville – Pros i. Part of the Greater Toronto Area, lakeside town with approximately 165,000 residents ii. Least expensive leasing option iii. Higher household median income than other alternatives iv. Little direct competition v.

Locale could be a good fit with Marble Slab’s price points – Cons . Located far from Thomas’s home ii. Unsure whether population is large enough to support event catering 3. Promotional Campagin a. Toronto Star – Pros i. Canada’s most widely read daily newspaper ii.

Circulation ranges from 360,000 – 608,000 copies sold daily iii. Appeals to greater number and variety of people iv. Options of advertisement sizes – Cons i. Technology has changed news/information search to the use of the internet ii. Advertisements are relatively expensive. $383.

50 to $2,538. 0 b. Now Magazine – Pros i. Alternative news and entertainment niche ii. Available at no charge – Cons i. Small demographic range (15 to 24 years old) ii. Limited locations in the Greater Toronto Area c. 104.

5 Chum FM – Pros i. Covered a large area of Southern Ontario, and most listeners in city of Toronto ii. Wide demographic (25 to 54 years old) with a contemporary blend of music iii. Listened by over 1. 2 million Canadians (920,000 living in Toronto area) on a weekly basis. – Cons i.Hard to convey Marble Slab’s message through an audio medium d.

Pattison Outdoor – Pros i. Large visual advertisements: Attention grabbing depending on graphic design ii. Leading outdoor advertising company that had a strong presence in several markets across Canada – Cons i. Other franchises had varying reach results ii. Expensive option ($1,060 to $3,270) e. Canada Post Direct Mail – Pros i. Flyers can be sent to target postal routes based on geography, demographic variables, and lifestyle information such as spending habits ii.

Only 11. 6 cents per item delivered to pay production cost iii. High redemption rate (2% to 10%) generating solid customer traffic – Cons i. Cost to manufacture flyers ii. Store traffic from redemptions will level off iii. Might be perceived as junk mail Research Information • Exhibit 1 on page 10 shows the cost of the different products offered at Marble Slab. Products range from normal ice cream, smoothies, pies, and drinks of roughly $5.

00 to specialty ice cream cakes of $23 and up. Exhibit 2 on page 11 consists of Census information for Vaughan, Toronto Annex Area, The Beaches, and Oakville. Vaughan has the largest population overall (235,865) and the highest young adult percentage (13.

87%). Oakville has the highest median household family income at $101,675. • Exhibit 3 on page 12 shows Marble Slab’s flavor and standard Mixins list.

It contains 48 flavors (from Amaretto to White Chocolate) and 33 Mixins (from Chocolate Chips to Walnuts). • Exhibit 4 on page 13 shows Contribution Margins and Sales Breakdown percentage of Marble Slab’s various products.It indicates that the popularity of an Original Ice Cream (with one Mixin) makes up 35% of sales. Child’s size (with one Mixin) follows closely behind at 15% of sales. This gives us an idea of who would be best to target (families); if our location is well populated with them. • Exhibit 5 on page 14 lays out the Promotional Costs and level of choices for each promotion. The Toronto Star newspaper ads range from a 2×2 inch ($383. 50) to a Banner (10 ? ” x 2 13/16”) at $2,538.

80. Now Magazine ads range from Card size ($535) to a Double Page ($6,140). 104. Chum FM ranges from $650 for a 30 second ad at breakfast to $300 for a 60 second ad in the evening. Pattison Outdoor offers 10×20 Outdoor Billboards ($2,950), 4×5 ? Street Level Media Units ($1,060), and Bus Ads (Back/Side) at $2,460/$3,270.

Canada Post Direct Mail would charge 11. 6 cents per item delivered. • Exhibit 6 on pages 15 & 16 describe Catering options and pricing. 4 P’s Price The average selling price for Marble Slab’s products will be $6. 80. This takes into consideration of the wide range of priced products, from slab cake to child cones. The average unit contribution is $4. 0.

| |Break Even(units) | |For $10,000 advertising costs |2500 | |For $400,000 expected revenue |100,000 | |For $430,000 (Revenue + Advertising costs + $20,000 Profit) |107500 | Number of units sold each day to break even | | |1 Month |2 Months | |$10,000 |84 |42 | |$400,000 |3,334 |1,667 | |$430,000 |3,584 |1,792 | | |Selling Price |Margin |Unit Contribution |% of Sales Breakdown | |Slab Cake |$54. 95/$0. 55 |76% |$41. 76/$0. 42 |1% | |Small Cake |$22. 95/$1. 15 |69% |$15.

84/$0. 79 |5% | |Milkshake |$5. 70/$0. 11 |58% |$3. 31/$0. 7 |2% | |Big Dipper |$5. 95/$.

60 |55% |$3. 27/$0. 33 |10% | |Original Ice Cream (with one|$4.

95/$1. 73 |52% |$2. 57/$0. 90 |35% | |mixin) | | | | | |Small Sundae |$5. 50/$0. 28 |48% |$2. 64/$0. 13 |5% | |Quart |$8.

95/$0. 3 |44% |$3. 94/$0. 28 |7% | |Child’s Size (with one |$3. 50/$0. 53 |41% |$1. 44/$0. 22 |15% | |mixin) | | | | | |All Others |$6.

16/$1. 23 |50% |$3. 08/$0. 62 |20% | |Average |$6. 80 |54.

78% |$3. 3 or $4 |100% | Promotion $10,000 budget • Canada Post Direct Mail- $1,198. 98 o 10,336 mailed x 11.

6 cents (mailing cost) = $1,198. 98 • 104. 5 Chum FM- $2490 o 1 (30 second) at Breakfast = $650 o 4 (30 second) at Drive = $1,840 • Pattison Outdoor- $4,010 o 1 Outdoor Billboard = $2,950 o 1 Street Level Media Unit = $1,060 • Toronto Star- $2,301 o 2×2 inch (3x/week) for 6 weeks = $2,301 • Total Budget Used- $9,999. 98 This is to recommend………with media use of the Canada Post Direct Mail, 104. 5 Chum FM, Pattison Outdoor, and Toronto Star, and with expected financial results of a breakeven equal to 2,500 units to cover the $10,000 advertising expenses.



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