Entering the retail tableware market with existing loyalty brands. Based on competitor analysis, trend analysis & consumer research

Abstract

Objectives – Already being a well-established player in the cookware market, the Cookware Company (hereafter: CWC) is now looking to expand its current product portfolio as part of its strategy for future growth. In that regard, the company has an important asset: its loyalty channel. It is of paramount importance to understand that the CWC consists of 2 divisions: a retail and a loyalty division. The entire company is organized with this dichotomy in mind. The retail channel is the more obvious of the 2: the CWC offers its renowned cookware to the end-consumers via retailers, such as mass markets, specialty stores, e-commerce, its own web shop… The loyalty channel, however, requires some explanation. A loyalty program offers specific collections at supermarket chains for a limited amount in time, at significant discounts (up to 70%). Consumers are participating in the program if they are collecting the points they receive when purchasing for a predefined amount at the supermarket chains. By offering these loyalty products via supermarket chains and selling them at a compelling discount, the loyalty items attract a lot of consumers and loyalty campaigns thus result in a huge customer reach for the CWC. As a result, it gains very valuable insights within the consumer market. Besides, the loyalty division has experimented much more with its product offering compared to the retail channel. This is due to the fact that supermarket chains prefer offering their clients diversified loyalty programs. As a result, the CWC’s loyalty division has already offered cookware, but also home fragrances, kitchen knives, tableware, serve ware, lighting, garden supplies… as opposed to the retail division that – up until now – has only focused on cookware. But this is precisely what the CWC wants to change as part of their future growth strategy. Is it possible to use the existing tableware brands of the CWC loyalty division as leverage for the launch of a tableware brand in its retail division? “Tableware” refers to dinnerware, glassware and cutlery. To date, the CWC has 3 loyalty brands related to tableware, namely MOODS, Keltum and Royal van Kempen & Begeer. They each have their own identity and each target a different customer segment. Consequently, the CWC has asked us to position these existing tableware loyalty brands in their competitive landscape. Other than that, the company would like to know how to enter the tableware market on a short and mid-long term with their MOODS brand. The geographical scope of the project was limited to 7 key countries in Europe, namely Belgium, the Netherlands, Germany, France, the United Kingdom, Denmark and Sweden. These 2 questions form the core of our project and are in fact our research questions. They are very relevant to the CWC as a loyalty brand differs fundamentally from a retail brand, which implies that a successful loyalty brand cannot be converted to a retail brand without further ado. As retail offers to some extent more possibilities (due to, among other things, the removal of the high price pressure within the loyalty division to enable the appealing discounts) in terms of assortment, pricing, target group, designs, distribution channels… a thorough research is needed before jumping to a product launch. Actions taken – To answer these questions, we could build upon pre-existing knowledge of the company, collected due to their previous market entry in the tableware market with the loyalty division. Besides, we could count on the expertise of the CWC employees that provided us with detailed and hands-on information regarding their area of expertise. Other than that, it was up to us to extend the CWC’s knowledge with our own research. To that purpose, we took the following actions. First of all, we conducted a market analysis. This was mostly based on desk research, consisting of information from well-known databases and included a description of macro-environmental influences, the current homeware market and consumer trends within Western Europe and the 7 European countries we were asked to focus on. Secondly, we conducted a competitive analysis. This required us to identify the main market players within Western Europe and the 7 key countries. Consequently, we zoomed in on specific potential competitors for MOODS, Keltum and Royal van Kempen & Begeer. We therefore conducted a price point analysis with selected brands in Sweden and the Netherlands. Thirdly, a trend analysis was undertaken. We unravelled trends in design by means of desk research, field trips, expert interviews and a consumer survey in Belgium, enumerated inspirational and trending tableware brands and added popular and trendy brands to our price point analysis that was previously limited to the selected brands in Sweden and the Netherlands. This extension of the price point analysis allowed us to draw more valid conclusions from out dataset. Fourthly, we summarized the by then collected information in a SWOT analysis. And fifthly, we performed a cross-analysis on our consumer research in the Belgian market (with 549 respondents). This awarded us a deeper understanding of the respondents’ demographics, choice of design, buying criteria, buying behaviour, distribution channels and other desires related to tableware. We could then compare our consumer research with previous ones conducted by the CWC and with our own trend analysis to investigate whether respondents’ preferences corresponded to the identified trends. Consequently, we proposed a marketing strategy by means of the STP framework and a marketing mix. The project is topped off with an overview of where we see MOODS now vs. where we see MOODS going, followed by a conclusion that also contains the limitations of our project.