Thomas Carvel founded Carvel Corporation (Carvel) in Hartsdale, New York on 1934 which is a permanent roadside location. Before this he uses his mobile ice cream trunk.
Carvel established Carvel Asia Limited on 1994, to act as holding company for the ice cream maker’s operational investments in Asia, starting in Beijing. Teamed up with China’s Minister of Agriculture to create Beijing Carvel Food Company Limited (Beijing Carvel), a joint venture equally owned by both parties. Beijing Carvel has established 10 retail stores and 150 wholesale accounts throughout Beijing on 1998. However, company had experienced losses every year since its inception; but its financial performance had steadily improved.
Steven Wang, a fluently bilingual American-born Chinese, jointed Carvel Asia Limited in September 1997. After spending three months, he moved to Beijing with a priority mandate to increase Beijing Carvel‘s sales, particularly in the ice-cream cakes category. But he quickly discovered, “this was going to be difficult because there is an amazing lack of information upon which to base any decisions. Then he relied on his own observations, feedback from Beijing Carvel customers and sales staff, and information gleaned from business magazines and public reports to help him make his decisions.
2. EXECUTIVE SUMMARY
Steven Wang, manager of business development for Beijing was responsible to find multiple alternatives to increase sales in company most important product ice cream cakes category. There were many challenges that Steven had to face such as to develop a complete marketing program for a product that was relatively new to most Chinese which contribute lack of brand awareness.The price of premium ice cream cake considered expensive among Chinese and their dairy product consumption among the lowest in the world because of high incidence of lactose-intolerance and long-held belief that cold foods are bad. The constraint was given by very limited budget on advertising and promotion and there was no complete reliable information that Steven could used in order to support his decision. Steven believed that, once they succeed developing a complete marketing program in Beijing, they could transfer it to other district of the China.
In developing a complete marketing programme to increase sales, Steven Wang has to retain popular ice cream cake selection based on Carvel US success in “Little Love” and “Piece of Cake”. He also needs to maintain price and premium quality of the product as well as image brand. On distribution, Steven Wang must emphasize on selective distribution and terminate for the poor accounts. From the three market segment, Steven should focus on middle and upper class Chinese professional by using advertising leaflet as the most cost effective marketing communication program with constrained budget.
3. PROBLEM STATEMENT
Carvel in China had experienced losses every year since its inception on 1994. So the main problem for Steven Wang acting as manager in China was to determine how best to increase ice cream cake sales in Beijing market. Beijinger was lack of brand awareness and acceptance due to different cultural norms (conservative group).
In doing so, Steven need to develop a complete marketing program that includes decisions about product offerings, pricing, distribution (placement), and communication (promotion) "the 4Ps."
4. DATA ANALYSIS
Problem statement above mentioned comes from data analysis that we found as follows:
Carvel Corporation (Carvel)
Originally, the company served only soft ice cream cones and milkshakes before developing other products, such as ice cream cakes. By 1998, Carvel owned and operated over 300 retail stores in the U.S., Canada, Puerto Rico and china, and had granted franchise rights to over 600 others.
The product Carvel sold fell into three categories...