Opening A Cafe In Moscow Russia Marketing Essay

spring A Cafe In capital of the Russian Federation Russia Marketing EssayWe be a re livelyfully established company in food and insobriety industry. We excogitation to company up our impertinentlyman caf stock in a channel argona in capital of the Russian Federation, Russia. We want to antitheticaliate ourselves from our competitors by providing juicy fruit select and extravagantly portion quality. Our caf shop is not precisely a sucker for heap to enjoy life story unless to a fault a suitable place to lend.Russia is a in truth varied in culture (Euro-Asia) comparing to other western countries. It changes so quickly that we sine qua non to work deeply on our groceryplaceing plan to adapt to this disruptive changing market.2. Market Analysis2.1. The Market of RussiaRussia is the worlds largest country in terms of atomic number 18a, stretching from the Baltic to the Pacific across 10 cadence z unrivaleds, with an estimated macrocosm of 144 million.Russ ia is one of the fastest growing emerging markets at march with a GDP development of 7 percent in 2008. tax revenue from crude oil colour and natural gas exports and strong municipal carry be contributing to a booming economy, fashioning it the bright mend in an otherwise challenging region.Russia ranked third, in A.T. Kearneys Global sell Development Index 2008, which qualifies it as one of the most attractive retail markets for international investors. Robust income growth, a reduction in unemployment, consistent presidential term policy and a rapidly increasing middle class erect optimistic expectations for the future tense development of retailing in Russia.2.2.The Market of capital of the Russian Federationwhere we want to set up our archetypal cafMoscow is the capital and the largest city of the Russian Federation. It is as well as the largest city in Europe, with the Moscow metropolitan rank among the largest urban argonas in the world. Moscow is a major polit ical, economic, cultural, religious, financial, educational, and transportation centralize of Russia and the world.2.2.1. PopulationAccording to the 2002 Census the flock of the Moscow was 10,382,754, however, this figure hardly takes into account legal residents. Substantial numbers of internal migrants mean that Moscows population is still increasing.2.2.2. EconomyMoscow is a major economic total and is home to the largest number of billionaires in the world, which is the reason why we choose Moscow to start our Caf grasp business in the beginning expand to other cities of Russia.Since a signifi give the gatet portion of Russias profits and development is concentrated in Moscow as many multi-national corporations incur branches and off nuts in the city, we may consider whether to hind end this divide of white-collar working class by providing a finicky quieter area in our umber shop especially for them, with Wi-Fi free of charge, making them feel that our coffee shop is a suitable place to work while enjoying their coffee break.2.2.3. CrimeHowever, while the overall stability has change in the recent stratums, crime continues to remain a problem hindering business development. Pick-pocketing is frequent in Moscow, as well as burglary from vehicles. organized crime in Moscow and Russia in general, has often been involved with medicine trafficking, cyber crime, prostitution, and financial crimes.Thus, we suck in to consider the security level when we are selecting the position of our coffee shop(s), not only for the galosh of our shop itself, but for the safety of our employees and our clients.2.2.4. TransportationAirThere are five dollar bill primary moneymaking(prenominal) dromes serving Moscow Sheremetyevo planetary airdrome, Domodedovo International Airport, Bykovo Airport, Ostafievo International Airport and Vnukovo International Airport.We may consider whether we open a coffee shop at bottom the Sheremetyevo International Airport or/and the Domodedovo International Airport, as Sheremetyevo International Airport is the most common entry point for foreign passengers, handling 60% of all international flights, while Domodedovo International Airport is the leading airport in Russia in terms of passenger throughput, and is the primary gateway to long-haul domestic and CIS destinations and its international traffic rivals Sheremetyevos.MetroLocal transport includes the Moscow Metro, a metro system famous for its art, murals, mosaics, and ornate chandeliers. Today, the Moscow Metro contains xii lines, mostly under strand with a total of 177 stations. The Moscow Metro is one of worlds busiest metro systems, serving more(prenominal) than nine million passengers daily.Again, when selecting the location of our coffee shop, we come to take into account the transportation factor. We must choose a place where it is not only easy to recognize but also convenient to arrive at.2.2.5. Internet UserInternet perceptivity is demoralise than in Western countries, although it is developing at a fast rate in Russia, and is currently at 30.2%. The number of internet substance abusers has risen from full 220,000 in 1995 to 42,936,000 users in 2007. Service providers are expanding beyond their traditional markets in Moscow and St. Petersburg into Russias regions. Although still low at around 38%, PC penetration improved rapidly from less than 1% in 1990. go on growth in the home testament power of PCs will spur foster development in the number of internet users as PC ownership and internet development are closely linked.Possession of PC and growth of internet users 2002-2007Source Euromonitor International from national statistics/ITU3. Industrial Analysis3.1. Food profit fabrication in RussiaCafs and restaurants account for 37.3% of the industrys value in 2007.3.1.1. Market nurture ForecastThe compound one-year growth rate of the industry in the geological period 2007-2012 is predicted to be 5.1%.3.1.2. Market Volume ForecastThe compound annual growth rate of the industry volume in the period 2007-2012 is predicted to be 0.3%.From the to a higher place data, we can see that the market volume for the next 5 years is expected to grow s tea leaf leafdily but low in growth rate, In 2012, the Russian foodservice industry is prefigure to suck in a volume of 5,112.1 million transactions, an increase of 1.7% since 2007, while the market value during this period will enjoy a healthy growth. In 2012, it is forecast to ware a value of $6.5 billion (165.6RUR billion), an increase of 28.3% since 2007. That is to say, the market will be in a impetus with low volume of transactions but can generate higher value. This information will lead us to differentiate our caf shop from other common coffee shops by providing high quality of products and service with relatively higher outlays.3.2. Hot Drinks Industry in RussiaCoffee gross revenue proved the most lucrative for the Russian risque drinks market in 2007, generating total revenues of $2.5 billion, equivalent to 64.1% of the markets overall value. In comparison, sales of tea generated revenues of $1.3 billion in 2007, equating to 33.5% of the markets aggregate revenues.3.2.1. Market apprize ForecastThe compound annual growth rate of the market in the period 2007-2012 is predicted to be 2.2%.3.2.2. Market Volume ForecastThe compound annual growth rate of the market volume in the period 2007-2012 is predicted to be 0.9%.In 2012, the Russian hot drinks market is forecast to have a value of $4.3 billion, an increase of 11.3% since 2007, and a volume of 285.8 million kg, an increase of 4.7% since 2007.Again, the above data justifies our decision of make water intoing Russia market, as coffee still clay the most popular and important hot drinks among Russians.Buyer PowerSelf-complete Muscovite throng with high utilization potential extemporaneous group of people stealing compulsivelyNeeds and wants ch ange very quickly3.3.Porter five forcesIndirect CompetitorsRetail stores and mallsNew PlayersNew large groups same Starbuck chain look at enter the marketLong period to enter the market because of barrier of laws and governmentNumber of tender players already in the marketFoodservice Industry RussiaNumber of new companies, choice stretch outed to the customer high growth in value than in volumeDifferentiation in product quality and visibilityBrand building is key for this market very competitive marketServices alliances (suppliers)Necessity to make alliances with suppliers to goImportance of having wide-cut quality food at low priceSourceDataMonitor Published September 2008)3.4. SWOT analysisSTRENGTHSWEAKNESSESStrong market growthPurchasing high quality raw materials give us a competitive advantageBeing able to adapt our product and business model to the market impoverishments and wants customer changesStrong market study to verify our assumptions on the field and later on fitting through regular surveysStrong subroutine figure outAlliances with suppliersStaying aware of the different cultures that exist in MoscowStrong values in accordance with customers own values (e.g. on quality respect)Time to implement the grammatical construction due to our lack of market knowledgeSeasoned industry (week-end and age off for holidays because of business area)High cost for commodities (high level of equipment required)Build a partnership with business partners can be long and not steadfast enoughLack of stability of human resourcesOPPORTUNITIESTHREATSTaking into account the market changesHigh capacity for adaptationHaving a leading schema In Moscow will put us one step forrard from competitors, is a key factor to create a new trendCreate a team spirit in the company that relieve Faithful the human resourcesGovernment regulationCompetitors like Starbuck Coffee with a financial advantageMarket demand difficult to evaluate4. StrategiesOur strategy is a mark et penetration strategy, focusing reaching a new customer market niche.Current productsNew productsCurrentMarketsMarket penetrationStrategyProduct-developmentStrategyNewMarketsMarket developmentStrategyvariegationStrategySource Strategies for diversification by Igor AnsoffOur approach is to enhance relationships with our customers, the self-realized people that it corresponds to middle-aged people with a high consumption potential.4.1. Objectives (a 5-year Plan)Investment 100,000 euros for the first caf shopTimetableTimeactionsresultsT0 +6 monthsMarketing studyT0 + 12 months planning for the establishment of our first caf in MoscowGet everything done onward operation (place, suppliers, HR, etc)T0+30 months (to be consolidated) (Breakeven point) (estimated after 18 months of operation)operation of our first Caf shop and consolidationAt least to reach breakevenT0+36 months settle investors and prepare to open the here and now caf shopOpen the second caf in the same cityT0+ 60 months Find investors and prepare to open more caf shopExpend more caf shops in other cities in RussiaquantifiableAverage number of customer per dayNumber of days of operation per year (5 days / week)Total sales per yearEstimated profit after 2 years of operation (5%)300 400250 days500,000 euros25000 euros per yearAchievableWe think that our objectives are achievable and this lowest estimate will be consolidated.4.2. Segmentation/TargetingTo be useful, market segments must rate favourably on five keys criteriaIt has to be measurable, substantial, accessible, differentiable and actionable. (Source Kotler Keller Marketing concern second edition)The segment, we have chosen for this marketing plan complies with those criteria.Our target is the Self realized groups of CustomersWhat are their characteristics?Self-realized group is middle-aged people with a higher harmonise of women. They have a high consumption potential. Their values go to life quality and healthcare.On the opposite of inno vators group or spontaneous ones, they dont like advertisement. They want to make their own choice based on the facts they have access.What are our assumptions regarding to the benefits this type of customers want to discover when entering in our Caf?The describe of characteristics we need to measure thanks to a marketing survey before applying to our Caf are the followings.Quality 1stQuick to getComfortable when having more timeSegmentationCustomer typeBenefitsInnovatorsSpontaneousAmbitiousSelf-realized colonisedTraditionalistsThriftyHigh quality drinks/food3151526High quality service4262616Relaxing area2544245Nice working area (with wi-fi)6613465Nice place to meet people1326154Takeaway/Phone distinguish delivery service5435334SegmentBACACDDTargetingWe want to target segment A which include Spontaneous and self-realized people. The second largest group, the Spontaneous, is dominated by men and singles, and they often obtain goods impulsively. The Self-realised are middle-aged p eople, with a higher proportion of women, and a high consumption potential. This important group tends to be irritated by advertising, valuing quality and pays circumspection to healthcare.Explanation of the customer types in segmentationRegion-Media, specialists in Russian advertising, have conveniently identified seven types of consumers in this market. The growing group of Innovators are mainly based in Moscow, prefer to spend their free time involved in sports activities and active leisure and eat out in restaurants featuring exotic cuisine. The second largest group, the Spontaneous, is dominated by men and singles, and they often buy goods impulsively. The cluster of the Ambitious is abjecter, and relies on advertising when looking for a product. The Self-realized are middle-aged people, with a higher proportion of women, and a high consumption potential. This important group tends to be irritated by advertising, valuing quality and pays tutelage to healthcare. The largest g roup are the Settled (25% of consumers in Russia and 21% in Moscow), a rather traditional group with great brand affinity innovations however interest them. The Traditionalists pack a low consumer potential, as half of them are retired and loyal to retail outlets that have survived since Soviet times. The last and smallest cluster, Thrifty, mainly shops in discount shops.(Source www.euromonitor.com Top 10 consumer trends in Russia)4.3. PositioningTo convince customers of our targeted segment that coming in our caf will brook the benefits they need.To spontaneous and self-realized people in Moscow that our caf shop is a nice place for both working and relaxation, because it produces products and services in high quality, free wi-fi access, takeaway/ phone order delivery services,4.4. Designing the Offer ( Marketing Mix)4.4.1. ProductsWe offer high quality drinks and healthy food with first rate raw material.For us, products must be natural and fresh.ExamplesCoffeeThe basic offer c ontains, cappuccino, latte and espressos do with grains from different countries as Brazil, Italia, Colombia or Kenya.ChocolateOur Caramel Chocolate is a debut with cold java, whipped cream and a drizzle of hot caramel sirup.The Canadian cocoa is made with dark chocolate and cranberries.TeaOur basic offer is represented by international flavour as greenish tea and white tea from lacquer and China and yellow tea, a very rare and delicate blend from China. The last one is Ceylon tea, a gloomy tea from Sri Lanka.We also offer flavoured teas as Jasmine tea from India, a conclave of green tea and oxidized jasmine flowers. The Mint tea from Morocco is Gunpowder tea in which is added, during the infusion, fresh mint leaves and sugar. And finally, Earl Grey tea that is a tea blend with a distinctive flavour and aroma derived from the addition of oil extracted from the rind of the bergamot orange, a fragrant citrus fruit.Our Cafe MenuCOFFEECHOCOLATEEspressoThe onus of coffee extrac ted into a concentrated one ounce beverageEspresso MacchiatoA shot of espresso marked with a dollop of foamed drawTraditional CappuccinoEspresso combines with a smooth draw foam._ 1/3 espresso_ 1/3 steamed milk_ 1/3 frothed milkMochaEspresso with foamed milk with chocolate syrup or powder addedLatteEspresso combines with steamed milk, topped with a small sum of money of milk foam._ 1/3 espresso_ 2/3 milkAmericanoEspresso diluted (after brewing) with an equal portion of hot waterLatte ruseLatte RosettaHot ChocolateMexican ChocolateCanadian chocolateCaramel ChocolateTEABushells, Earl Grey, English Breakfast, Irish Breakfast, Vanilla, Arctic Fire.herbal tea Teas Red Zinger, Chamomile, Lemon, PeppermintCeylon tea a scandalous tea from Sri LankaGreen tea yellow tea from ChinaWhite tea from JapanJasmine tea from IndiaMint tea from MoroccoSOUPTomato Dill dope up chromatic tomato soup with chunks of sweet tomato. Topped with sour cream. chicken Tortilla dopeSteamy chicken broth l oaded with smoked chicken, maw and cheddar cheeses, tortilla strips and scallions. stump spud give up SoupRich and creamy potato soup topped with jack and cheddar cheeses, bacon and scallions.Hot borchtch ()Traditional Russians soups made with beetroot, beans, cabbage, carrots and beef with thick dark bread.Butternut Squash and Sage SoupOlive oil, onion, squashes, fresh sage, chicken broth , salinity and impertinently nation black pepperShrimp and Basil BisqueUnsalted butter, onion , carrots , cultivated celery , bay leaf, long-grain rice, chopped tomatoes, basil leaves, heavy cream, salt and freshly ground black pepperWhite Bean and Rosemary Soup with roast Garlic CroutonsUnsalted butter, olive oil, onion, carrots, celery, vegetable broth, fresh rosemaryCreamy Potato Soup with Sour Cream, Bacon and ChivesBacon, onion, garlic, potatoes, chicken broth, salt and freshly ground black pepper , sour cream, Cheddar cheese ,chiveswinter Tomato Soup with Grilled Cheese CroutonsOlive o il, celery, carrot, tomatoes, crushed tomatoes, tomato paste, vegetable broth, bay leaf, cream salt and freshly ground black pepperStracciatella (Italian Egg Drop Soup)Chicken broth, globes, grated Parmesan cheese, plus more for garnish, semolina flour, spinach, parsley, nutmeg, salt and freshly ground black pepperMushroom Solyanka cabbage with vinegar, tomatoes, and cucumber vine pickles, with little brine, mushrooms, onions, lemon skin.SALADHouse Salad tangled field greens with paddy wagon of palm, red cabbage carrots. Served with your choice of a Candle dressing.Classic Caesar cos lettuce with herbed croutons in a creamy caesar dressing and sprinkled with toast dulse.Chicken SaladMixed leaves, chicken pieces, cucumber, tomato, corn, boiled egg and dijon mustard dressingSoba Noodle SaladSoba Noodles, gingery grilled tofu, shiitake mushrooms, edamame, julienne carrots, radish andsesame seeds over mesclun with a creamy wasabi dressing.Roasted Pear SaladArugula, roasted pears, shaved fennel, cashew-tofu cheese and toasted walnuts. Served with a cranberry vinaigrette dressing.Aztec SaladBi-color quinoa, black beans, red onions jicama topped with spiced pumpkin seeds and barbequed grilled tempeh. served over immix field greens with a toasted cumin vinaigrette.Buffalo Chicken SaladFried chicken tossed with spicy Buffalo do and served over a bed of compound greens with Bleu Cheese crumbles, mushrooms, tomatoes and eggs. Best with Bleu Cheese dressing.California Bleu SaladFresh mixed greens topped with Bleu Cheese crumbles, spicy sugared walnuts and fresh strawberries. Served with Bleu Cheese toast. Best with Sweet Balsamic Vinaigrette dressing.Hawaiian Chicken Shrimp SaladA skewer of spicy grilled peewit and tender diced chicken tossed in a sesame marinade. Served atop fresh mixed greens with tomatoes, sweet pineapple chunks, walnuts and toasted coconut. Best with Asiatic Sesame dressing.Monterey Chicken SaladHerb seasoned or Cajun-style chicken atop fresh mixed greens with bacon and egg, tomatoes, jack and cheddar cheeses. Best with love life Mustard dressing.Spinach Goat Cheese SaladLeaf spinach, red onions, mushrooms, bacon and egg with goat cheese, topped with spicy sugared walnuts. Best with our Hot Bacon Vinaigrette.Asian Sesame SaladDiced fried chicken tossed in our sesame marinade over mixed greens, red onions, tomatoes and mandarin oranges. Topped with Asian noodles. Best with Asian Sesame dressing.Smoked Chicken Cobb SaladSmoked chicken atop mixed greens with tomatoes, black olives, red onions, jack and cheddar cheeses and crumbled bacon. Best with spreadhead dressing.Provence SaladChicken, ham, corn, peppers, cheese, cucumber, tomato, egg, mixed salad with a whole grain mustard and herbs de Provence dressingNordic SaladSmoked salmon from Norway, egg, salad, sorrel, chives and raspberry vinegarScallop caviare SaladFresh scallops, sevrugas caviar, endive, cider vinegar and saffronSMOOTHIES and HEALTH DRINKSOrange, B anana or Berry SmoothieMilkshakesBanana, Strawberry, Mango and Kiwi with pieces of white and dark chocolate on the top.Vitamin PowerStrawberries, kiwifruit, yoghurt, soy milk, wheat germ and honey (high in vitamins)Pick Me UpBanana, pineapple juice, coconut milk, yoghurt, honey, wheat germ and ice (energy booster)San PellegrinoStill or sparkling waterFreshly Squeezed Orange apple or Cranberry juiceGlass of MilkDESSERTSCarrot Cakeeffete Chocolate CakeDaily Cheese cakeSweet Potato PieSeasonal Fruit Crumb PieChocolate Mousse Pie( For the detailed price, we have to consolidate it during the first 6 months of detailed marketing study)4.4.2. ServicesOur employees are well trained waiters and waitresses. They will always welcome customers with warm grin and serve you in a very polite manner.We also offer takeaway or phone order services for people in a hurry. We just want to provide as much gizmo as possible to meet our customers needs.4.4.3. PriceAccording to our marketing research, the modal(a) cost for drinks is around 100RUB (3euros), desserts for 100RUB (3euros), a good meal costs nigh 400RUB (12euros) for one person, etc. As we are a caf with better products and services, we would price our products above average, sayCoffeeChocolate 5-8 eurosDrinks 3-8 eurosTea 5-10 eurosSoup 5-8 eurosSalad 5-10 eurosDesserts 3-8 euros4.4.4. Place (distribution)We plan to find a place near the business area because our main target is business people who care about quality of the products and services.In our future planning, we would like to develop our caf business in Russia through franchising after we have established the model of our caf brand, of course, this idea should be based on the good operation result of our first caf shop.4.4.5. PromotionsAs we are a only new cafe shop in Moscow, it is very necessary to use effective ways to make us known to Moscow people. We plan to use the following methods to promote ourselvesAdvertisingair our cafe shop on magazines such as business magazines, food magazines, etc. and newspapersAdvertise our cafe through radio, so that Moscow people can get the information during breakfast time, driving a car, etc. We do not plan to do advertisement, for it is too expensive for us, however, radio ads is a comparatively cheaper way.Showing billboard-type ads in business areasUsing transit ads on buses, subways and commuter trainsInternet MarketingWe decide to build up our own website in order to provide as much information as we can to attract more customers.Sales PromotionEstablish customer management system. Offer a fidelity card for customers when reaches a certain amount of consumption. And each time they consume in our coffee shop, they earn points into his card. The bring in points can be used as cash to pay for the products they buy in our cafe shop.Offer coupons occasionallyOffer free goods fit to different national holidays (eg. Valentines Day Christmas, etc.5. Action Plan interrogation has shown thatRelati onship Marketing is the ongoing process of identifying and creating value with individual customers and whence sharing the benefits from this over a lifetime association. It involves Understanding, focusing and management of ongoing collaborationBetween suppliers and selected customersFor mutual value creation and sharing by means of interdependence and organizational alignment.(From Gordon, Relationship Marketing, pg9.)To implement our strategy with this approach we need to focus on customer benefits on a long time scale basis.The action plan has been established using this approach.WhatObjectivesBenefitWhenWho/ claimTeam organizationOrganize the whole team. What are the objectives, the milestones, people in chargeProject Manager (PM)Align the project strategy with the business customer expectationsBe align on a same set of objectivesGoing the same way.PMProject LaunchStart the new project and let it knowProject team/PMDescribing the process and the people involvedBe aware of the advantages each one has to forecast and organize in advance. Understand the constraints and possibilities offered by the process.By knowing who is doing what and for which purpose, people can improve the whole processTaking into account the customer surveyDesigning the offer, adapt the menuAdapt to the consumer requirementsDesigning the offer