Aroma Australia Pty Ltd Goes to Japan

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Case study6.2 Aroma Australia Pty Ltd goes to Japan

Overview of case study

Aroma Australia Pty Ltd is a successful company which performed very well in instant coffee industry. To prepare for a move into Japanese market, Ken Ishiguro who is the marketing manager of Aroma did amount of marketing researches on the instant coffee in Japan. Originally he came to the conclusion that it would be difficult for Aroma to enter Japanese market, due to the culture difference between Japanese and western consumers.

However, as there was not enough consumer behaviour data, research conducted on 1000 households in Tokyo by Market Intelligence Corporation (MIC) on this factor was used to further analyse the market. The report gave a variety of information in several consumer behaviour factors towards the leading instant coffee brand. Moreover, it provided a predicted data on the whole Japanese coffee market with a model called NBD-Dirichlet for purchase incidence and brand choice. The drawback to this model is that it didn’t consider the reason behind decision made by individual consumer on particular occasion. Ken compared five product categories to help him to face some challenges. With these data, which make him understand Japanese consumer buy brands of instant coffee.

Analysis and Evaluation of Questions

1. Consider why it is important for a marketing manager such as Ken Ishiguro to focus on consumer behaviour as well as consumer attitude, beliefs and intentions.

Ajzen (1991) proposed theory of planned behaviour (TPB). TPB hypothesis the higher attitudes toward the behaviour, subjective norms and perceived behavioural control are related to the stronger behavioural intention. Furthermore, behavioural intention can make significant contributions to predict behaviour (Ajzen 1991).

For Aroma Australia Pty Ltd, which wants to enter new market, it focuses on these factors can predict decision-making to apply different strategise and find out the target market. However, these factors are a part of the reasons to predict and explain consumers to purchase products. To Ken, the most efficient way to save money is directly to understand consumers’ purchasing-behaviour. By researching past purchase behaviour what would be a source of information for affecting particular intention and identifying attitudes (d’Astous et al. 2005; Norman & Conner 2006). Therefore, Ken can minimise the risk and create “purple cow” to Japanese market.

2. Looking at the instant coffee data in Tables 1 and 2, describe ant patterns that you observe.

From the table1, it can clearly be seen that the leading brand of instant coffee market is Nesgold which accounted for 39 percentages, followed by Nescafé, Maxim, Minor brands, Maxwell House, Other Nestlé and Other general Foods. Especially, the proportion of Nestlé Company was over 60% which dominates Japanese instant coffee. Generally speaking, there is a positive correlation between market share of the brands and other four aspects of the research included penetration percentage, average purchase frequency per buyer, share of category requirements and percentage of loyal buyers. While the market share decreased, the other four columns reduced as well.

Taking a closer look at the table 2, it is revealing the percentage of buyers of one brand who also bought competing brands. It’s obvious that there were a positive correlation between market share and duplication purchase. Brands with lager market share are generally also bought more frequently than smaller brands. Moreover, the phenomenon that buyers of smaller brands tend to be less loyal is called double jeopardy (Ehrenberg, Goodhaedt & Barwise 1990).

From the observing the tables, however, it is one particularly interesting fact highlighted is that there were only two brands which didn't follow completely in accordance with the pattern in both tables are Maxim and Other General Foods. The former is a local Japanese brand which had a...
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