Marketing Audit and SWOT Analysis of Cafe Coffee

This report focuses on introducing the new organization that is Cafe Coffee that mainly supplies organic coffee beans and powders within the new UK market. The report proposes the mission and corporate objectives for the organization as well as analyzing macro and micro environment for producing the effective strategic plan. It also includes a SWOT analysis of the chosen product and services.

Principles and Practice of
marketing
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TABLE OF CONTENTS
INTRODUCTION ..........................................................................................................................3
1. Mission statement of organization ..............................................................................................3
2. MARKETING AUDIT ...............................................................................................................4
2.1 Macro environmental analysis ..............................................................................................4
2.2 analysis of task environment..................................................................................................6
3. SWOT ANALYSIS OF CHOSEN PRODUCT AND SERVICES.............................................8
4. RANGE OF MARKETING ASSUMPTIONS..........................................................................10
CONCLUSION..............................................................................................................................11
References......................................................................................................................................12
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INTRODUCTION
In order to sustain in the competitive marketplace it is essential for the organization to
focus on strategic marketing plan that will support the enterprise to introduce their new services
and product within the new market (Blythe, 2006). Therefore, it is essential to measure the
current market situation and focus on in-depth marketing audit so that enterprise can easily
supply their new product and services to the large customers. The present report focuses on
introducing the new organization that is Cafe Coffee that mainly supply organic coffee beans and
powders that is Gorilla coffee, Soy coffee roaster and green mountain coffee roaster within the
new UK market due to increasing pace of organic substances within the marketplace. Presently,
the report will focus on the proposing the mission and corporate objectives for the organization
as well as analysing macro and micro environment for producing the effective strategic plan.
1. MISSION STATEMENT OF ORGANIZATION
The mission of Cafe Coffee will be to provide organic coffee powder and beans to people
across UK. Further people prefer more coffee as compared to tea or any other related drink.
Coffee so considered as one of the most popular drink all across the world and there are
approximately 70 million cups of coffee which are consumed every day in UK. People drink
coffee after waking up and post dinner (Reibstein, Day and Wind, 2009). The present market
players in the coffee industry are manufacturing and selling coffee which aid of artificial
chemical substances. The results of this is that it creates a great harm to body. Cafe Coffee will
be selling organic coffee in order to satisfy the need of people in market and protect them from
any harm caused by drinking coffee. The corporate objectives of Cafe Coffee are mentioned
below as:
 Develop brand awareness with the help of increasing 200 new customers every month
 Increasing sales by 12% in every month
 Achieving double digit growth rate in next one year
 Reaching profitability within first 8 months
In order to achieve mission and corporate objectives, Cafe Coffee will be required to
develop an effective marketing plan (Winston and Mintu-Wimsatt, 2013). Further effective
promotion and advertisement of organic coffee will be also carried out to create more and more
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awareness among people in market (Kjellberg and Helgesson, 2006). Male coffee drinkers
consumes 13 cups of coffee every week whereas female drinkers consumes near about 11 cup
per week. Therefore, it can be stated that there are adequate opportunities for growth and
development of Cafe Coffee.
2. MARKETING AUDIT
2.1 Macro environmental analysis
There are some macro environmental factors such as political, environment, legal,
technological etc. which will have direct or indirect impact on the operations of Cafe Coffee.
Further before developing any kind of marketing strategies or action plan, these factors and their
impact will needs to be taken into consideration (Rhode, 2005).
Political factors
These are the factors which includes policies, legislations and regulation which is framed
by the government of UK. Further all these factors will have direct or indirect impact on the
activities and operations of Cafe Coffee. The brand will be required to follow regulations and
other related practises very strictly. Companies such as Starbucks has been blamed a lot for
violating the working hours and wages of labour (Piekkari, Plakoyiannaki and Welch, 2010).
Lawsuits have been charged and penalties have been imposed on Starbucks. Thus, it can be
stated that Cafe Coffee will be required to take care of the working hours and wages of all its
workers. Political factors can also influence the activities of the organization at the time of
sourcing its raw materials. At the time of importing raw materials, the trade barriers in UK can
become obstacles. The tax rates and duties will also have their negative and positive impact on
Cafe Coffee.
Economic factors
Cafe Coffee will have direct impact of the economic factors present in the country.
Further these factors will make impact on sales and profitability of the organization (Maringe
and Gibbs, 2008). Any downfall in the economy means that the purchasing power of customers
will be lower down. The consumption rate of coffee will also decline along with the purchasing
power. UK has now overcome with the economic crises which has been faced by the entire
world back in the year 2007-2009. Now it is growing slowly but it is providing adequate
opportunities for growth to businesses.
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Social factors
The social factors are very favourable for Cafe Coffee as there are lot of coffee-drinkers
in UK. Further the products is common among all the age segments and gender. Students,
working people, adults, housewife's all consume coffee on daily basis (Donovan and Henley,
2010). There are more than 18000 outlets in the country which sale about 1.7 billion cups of
coffee everyday. The changing lifestyle of people in UK can be termed as one of the biggest
factors which as increase the rate of coffee consumption. Further the increasing health
consciousness among people will be also beneficial for Cafe Coffee as It will be providing coffee
beans and powder with no added chemical substances.
Technological factors
In UK, the rate of technological advancements is very high which means businesses have
adequate opportunists to improve their services. With the help of technology, Cafe Coffee can
promote its products and services on internet. Further it will also help in promoting beans and
powder in more cost effective manner. Along with this, technology can also support in
manufacturing of coffee beans and powder. Therefore, it can be sated that there are various kind
of benefits of technology for Cafe Coffee (Donovan and Henley, 2010).
Environmental factors
In last few years government has forced businesses to lower down their impact on
environment. Cafe Coffee will be required to take care of the fact tat its operations and activities
do not cause harm to environment. The band will be using sustainable practises which means that
less waste and hazards will be created. Further it can be stated that such practises will help in
enhancing the brand image of organization (Mish and Scammon, 2010). It will also support in
attracting customers and acquiring market. Instead of plastic, biodegradable material will be used
in packaging. In addition to this, activities and operations of Cafe Coffee will also take care of
the fact that energy and resources are used in best possible manner. Therefore, it can be stated
that the environmental factors will forced the brand to use some sustainable practises. The
impact of this will be on activities of Cafe Coffee but only for short run. In the long run, these
practices will be vcery helpful in growth and development.
Legal factors
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Legal factors induces the laws practises, health and safety legislations which has been
developed by the government of UK (Grönroos and Ravald, 2011). Cafe Coffee needs to strictly
addressed all these laws in order to operate smoothly and effectively. Global warming is
increasing day by day and the government has taken some corrective measures to reduce the
same. Now businesses are bound to adopt only those practises which are developed after taking
the laws and regulation into consideration. Laws such as health and safety laws is developed to
keep people and nation healthy and hygienic. Other than this, Cafe Coffee will be also required
to adopt equity practises at the time of dealing with the framers. The organization will be
providing organic coffee to all the people in market. This means that it will not face any kind of
consequence at the time of operating (Sheth and Sisodia, 2005).
2.2 analysis of task environment
The external or macro environment of organization consists different factors that directly
affect or impact the power organization to reach to the business goal. However, task environment
include any supplier, business or customers that directly involved within the organization is
termed as task environment. The task environment of Cafe Coffee can be outlined through
measuring porter's five force model as it mainly addresses the external forces so that company
can easily maintain their position in the beverage sector (Fischer and et. al., 2011). Therefore,
analysing the task environment factors is mainly responsible for attaining success of the
organization in the UK market as UK market possess huge competition from the renowned
coffee brands that is Costa Coffee and Starbucks. Further before processing any kind of
marketing strategies or action plan, these factors and their impact will needs to be taken into
consideration. The different factor of task environment focuses on different factors that is-
1. Competitors: Cafe Coffee while entering in the UK market faces huge competition in the
beverage industry. However, with the increasing level of organic products in the UK
customers tends to prefer the organic substances as it will benefit the Cafe Coffee to
successfully establish and enter in the UK market (De Pelsmacker, and et. al., 2005).
However, the company faces huge and intense competition from the top brand companies
as they do not prefer to provide organic coffee products and but they are regarded as the
competition for the Cafe Coffee. In addition to this, in the present scenario there are
different beverage organization like cafe district that mainly focuses on providing organic
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coffee beans and powder to the market customers so that it minimizes the defect or any
issues (Golding and Peattie, 2005).
2. Customers: Another element of task environment include measuring the customers as
they are the one to whom Cafe Coffee will provide their organic coffee beans and
powder. However, customers are the one that consume the services and products of Cafe
Coffee. Therefore, company need to focus on providing quality organic coffee beans and
powder so that they can retain the customers. Cafe Coffee organization must focus on
determining the needs and wants of the customers so that they must provide the preferred
product to them. However, it can be said that power of customers is strong on the
organization because customers expect superior quality organic coffee beans to the
customers as it will benefit them to be healthy (Hsu and Hung, 2005). Thus, Cafe Coffee
must continuously review and observe the environment of customers to assess the
changing needs and requirement of customers so that they can easily satisfy their needs to
be successful in the UK market. Hence, the bargaining power of customers in the task
environment directly affect and impact the operations and activities of the Cafe Coffee.
3. Supplier: Another element or factor of task environment that affect the operations and
activities of Cafe Coffee focus on suppliers. However, the bargaining power of supplier is
quite high in the beverage industry but Cafe Coffee may have weak bargaining power of
suppliers as they are new in the UK market therefore, they have limited suppliers to who
whom they would supply the raw coffee beans and powder (Giovannucci and Ponte,
2005). It has been assessed that selecting suppliers can directly influence the choice of
company as choosing the suitable and correct suppliers will result in providing quality
organic coffee beans to the customers.
4. Substitute: Another major factor of task environment include substitution there is high
rate of substitution within the industry and UK market. As, it has been measured that
customers in UK prefer more beverage as compare to the other region. Thus, rate of
substitution in the UK market is relative very high (Coffee Facts, 2016). Although, Cafe
Coffee also have large number of rival coffee brands and outlet in the UK that result in
strong availability of the substitutes. In the contemporary scenario, with the increasing
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organic substances and food customers are tending towards consuming organic coffee
powders and beans as it will not affect their health.
5. New entrants: In addition to this, another factor of task environment focus on potential
entrants in the coffee market as lower the entrants rate will result in lowering the
competition level as well as it also result in increasing or enhancing the profitability of
organization. As the market of organic food and substance is increasing at the fast pace
therefore, the bargaining power of new entrants is moderate in the UK region (Coffee
drinkers in the UK: a study – fact and statistics, 2016). However, in the UK market
potential entrants can easily enter into the market as organic food and item is gaining
pace as compared to the other businesses.
3. SWOT ANALYSIS OF CHOSEN PRODUCT AND SERVICES
Cafe Coffee is the new brand that deals in providing raw organic coffee beans and power
to the customers. For entering in the UK market Cafe Coffee organization need to analyse their
micro environment as it will help the marketing consultant in measuring their strength,
weakness, threat and opportunities related with the new coffee products that they are offering to
wide customers (Blythe, 2006). SWOT analysis mainly focuses on assessing the strength of the
new product that support the organization to become competitive among their rival companies.
However, it will also measure the weakness that act as the limitation or defect in the Cafe Coffee
organization that diminish their image. It also measure opportunities factor that will support the
organization to improve or amend their position so that they may easily enter into the new
market while, the threat are consider as the component that reduce Cafe Coffee competitive
position.
Strength
1. Strong relation from growers or third
party.
2. Mainly focuses on selling organic
coffee beans and powder of different
region coffee beans (Reibstein, Day
and Wind, 2009).
Weakness
4. Small market share
5. Does not establish the brand name
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3. Strong differentiation of the product.
Threats
1. Threat from occurrence of natural
disaster that damage the coffee crops.
2. Increase or decrease in the prices of
coffee.
Opportunities
3. Online selling of coffee powder and
beans.
4. Collaborating with the top supermarket
chain for selling coffee products.
5. Expanding their activities in the new
markets.
6. Increasing competition among rival
companies like costa-coffee, Starbucks
etc.
From the above concluded SWOT analysis it can be stated that each element have certain
impact on the current organic coffee products that is with the help of measuring their strength it
can be assessed that with providing organic coffee products and powders will result in providing
healthy beans and coffee to the customers so that it minimizes the risk of diseases and presence
of pesticides (Winston and Mintu-Wimsatt, 2013). However, reviewing the strength also result in
enhancing the presence of Cafe Coffee so that it may easily enhance their image within the UK
market. Furthermore, measuring the weakness will impact the organization to overcome the
imperfection so that they may sustain their position as well as new coffee organic products in the
UK market.
In addition to this, performing SWOT analysing also support the organization in
assessing the threats associated with the new product that are offering by the Cafe Coffee in the
new market. For instance; Cafe Coffee mainly focus on entering the new market UK therefore,
the threat of natural disaster will result in damaging the crops of coffee that result in increasing
the prices of bean (Kjellberg and Helgesson, 2006). Therefore, while entering into the market
organization must focus on minimizing the threats so that they may easily sustain in the UK
environment. Moreover, another threat that has been assessed is increase and decrease in the
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prices of coffee. As with the increase in coffee price result in increasing the prices of packed
coffee powders and beans.
Furthermore, the SWOT analysis also measure the existing opportunities for Cafe Coffee
so that they may easily provide the new organic coffee products and beans to the customers UK
market. The organization may have opportunity to collaborate with the different supermarket
chain so that cafe coffee can sell their organic coffee beans and powder to them so that they may
directly provide to the customers (Rhode, 2005). However, the impact of opportunity that is it
may result in expanding their activities in the different nation will also result in increasing their
market area as well as it also result in increasing their net profit.
4. RANGE OF MARKETING ASSUMPTIONS
There are different range of marketing assumption that are relevant to the marketing of
Cafe Coffee products while entering into the totally new market that is UK. Marketing
assumption focuses on expecting or predicting the future results or outcome from the past
experience or researching the market (Piekkari, Plakoyiannaki and Welch, 2010). So, that Cafe
Coffee may easily survive in the UK market and attain the market share. However, it may also
termed as post planning method that support the Cafe Coffee to deal or resist the change as well
as uncertainty existing in the market. The range of marketing assumption include-
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After placing Cafe Coffee on the digram of positioning, it can be stated that during the
initial stage the brand will lie on A category which includes low prices and high quality. In order
to complete with the existing market players and attract customers, low prices strategy will be
adopted by the firm. Along with this, it will also ensure the fact that highest quality of Coffee
powder and beans are being provided to people in the market. From this strategy, it can be
justified that the brand will be also to gain adequate sales and profits. One of the main reason
behind selecting this strategy is that if high price strategy is adopted than it may happen that Cafe
Coffee is not able to gain adequate customers.
Evaluation/ analysis and application - After carrying out the evaluation of the entire strategy, it
can be stated that the strategy will be very effective. It will capture the attention of people from
the market. The existing market players are performing really well and low prices will encourage
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Illustration 1: Diagram for positioning

individuals to try and use the products of Cafe Coffee at least once. Further with the help of high
quality, the brand will encourage people to buy its products again. During this strategy, Cafe
Coffee will be required to ensure the fact that an effective channel of distribution has been
implemented by it. People in the market will switch from existing brands to Cafe Coffee. If the
product is not available on time, then it will provide people with a clear reason to choose other
brands in market. After some time when Cafe Coffee will gain adequate market share and
customers, the brand will adopt high prices strategy. The rational behind this is that when people
will get aware of the fact that Cafe Coffee is providing beans and powders which is benefiting
their health, in such situation they will be ready to high prices also. Therefore, it can be
explained that the strategy will be very effective and will provide the brand with best possible
outcome. The marketing assumptions are provided below as:
 Cafe Coffee will grow with the rate of 10% every year
 Cafe Coffee 5000 units of coffee beans and powder will be sold in first 12 months.
 The brand will be in situation of earning profits after 5 months of starting the business
 At initial stage 4 distribution channels will be adopted which will be increased to 8 in
next year
 20% of the total revenue of first year will be spend on promotion and marketing of Cafe
Coffee.
CONCLUSION
From the above report it can be concluded that marketing is essential for the organization
so that they can easily provide and supply their products and services in the market to meet the
requirement and needs of the customers. The report also measure different macro environmental
factors such as political, environment, legal, technological etc. which will have direct or indirect
impact on the operations of Cafe Coffee. Further before developing any kind of marketing
strategies or action plan, these factors and their impact will needs to be taken into consideration.
Furthermore, the report also focus on assessing the micro environmental factor so that they can
easily provide the organic product in the market.
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Online
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<http://www.britishcoffeeassociation.org/about_coffee/coffee_facts/>. [Accessed on 7th
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COFFEE DRINKERS IN THE UK: A STUDY – FACT AND STATISTICS, 2016. [Online].
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