Buyer

Behaviour

TABLE OF CONTENTS

INTRODUCTION 5

1.0 MARKET 5

1.1 SIZE OF MARKET 5

1.2 MARKET SHARE 6

1.3 MARKET POSITION 7

1.4 BREATH AND DEPTH OF PRODUCT RANGE 8

1.5 COMPANY’S PRINCIPAL PRODUCTS 9

1.6 POSITIONING OF PRODUCT 10

1.7 PRODUCT LIFE CYCLE STAGE 10

2.0 COMPETITORS 10

2.1 DIRECT COMPETITORS 10

2.2 INDIRECT COMPETITORS 11

3.0 IDENTIFICATION OF TARGET MARKET 11

3.1 PRIMARY TARGET MARKET 11

3.2 POTENTIAL MARKET SEGMENTS 12

4.0 EXTERNAL INFLUENCES 16

4.1 CULTURE AND SUBCULTURE 16

4.2 DEMOGRAPHICS 17

4.2.1 AGE 17

4.2.2 GENDER 17

4.2.1 SOCIOECONOMIC 18

4.3 GROUP INFLUENCES 18

4.3.1 INFORMATIONAL INFLUENCES 18

4.3.2 NORMATIVE INFLUENCES 18

4.3.3 IDENTIFICATION INFLUENCES 19

5.0 INTERNAL INFLUENCES 20

5.1 NEEDS AND MOTIVES 20

5.2 PERCEPTION 21

5.3 LEARNING 22

5.4 LIFESTYLE 23

6.0 CONSUMER DECISION PROCESS 24

6.1 SEARCH FOR INFORMATION 24

6.2 EVALUATION AND SELECTION 26

6.3 OUTLETS AND STORE CHOICES 27

6.3.1 STORE IMAGE 27

6.3.2 RETAIL ADVERTISING 27

6.3.3 OUTLET LOCATION 27

6.4 POST PURCHASE BEHAVIOUR 28

6.5 DISPOSAL OF PRODUCT 28

6.6 CUSTOMER LOYALTY 28

7.0 MARKETING STRATEGY 29

7.1 PRODUCT 29

7.2 PRICE 30

7.3 PROMOTION 31

7.4 PLACE 32

8.0 EVALUATIONS AND RECOMMENDATIONS 33

8.1 EVALUATIONS OF ADVERTISING CAMPAIGN 33

8.2 FUTURE RECOMMENDATIONS 34

8.2.1 PRODUCT POSITIONING 34

8.2.2 PRODUCT (GOODS AND SERVICES) ENHANCEMENT 34

8.2.3 IMPROVED MARKETING COMMUNICATIONS 34

8.2.4 IMPROVED PURCHASE EXPERIENCE 35

8.2.5 IDENTIFYING POTENTIAL NEW CUSTOMERS 35

8.2.6 ENHANCING CUSTOMER SATISFACTION 35

CONCLUSION 36

REFERENCE LIST 37

APPENDIX 1A 40

APPENDIX 1B 41

APPENDIX 1C 42

APPENDIX 2 43

APPENDIX 3 44

APPENDIX 4 45

APPENDIX 5 46

APPENDIX 6 47

APPENDIX 7 48

APPENDIX 8 49

INTRODUCTION

This report critically examines Magnum and Häagen Dazs in terms of market share, target market and their marketing strategies. It covers the external and internal influences that could possibly persuade consumers in the decision-making process. Finally, this report evaluates the marketing strategies of both brands using buyer behaviour theories and provides evaluations and recommendations on how to increase the effectiveness of those strategies.

1.0 MARKET

1.1 SIZE OF MARKET

The ice cream market in Singapore has a total retail value of S$153.12 million and a total retail volume of 15,045,100 litres in 2010 (refer to Appendix 1A: Volume Sales). The market is forecasted to grow on a yearly basis from S$153.12 million in 2010 to $S170.29 million in 2015 (refer to Appendix 1B: Sales Forecast).

1.2 MARKET SHARE

Magnum's overall market share has grown steadily over the years and has captured 5.61% of the market in 2009 (refer to Figure 1A: Market Share of Ice Cream in Singapore during 2009). Cornetto, Drumstick, Magnolia and Häagen Dazs were the next four largest players in the market, holding 20.6%, 10.75% and 7.97% and 4.81% respectively (refer to Appendix 1C: Brand Shares).

Figure 1A: Market Share of Ice-Cream in Singapore during 2009

1.3 MARKET POSITION

Figure 1B: Perceptual Mapping of Ice cream brands

The market position for Magnum and its competitors is demarcated by perceived price and perceived quality. Magnum has a relatively high perceived price due to its exclusive image and extensive marketing campaigns which allowed it to achieve island-wide recognition. It is also perceived to be of high quality and is able to deliver the concept of ‘pleasure’ that Magnum projects, thus justifying it as a premium brand (refer to Figure 1B: Perceptual Mapping of Ice cream brands).

1.4 BREADTH AND DEPTH OF PRODUCT RANGE

Magnum carries a variety of ice cream which ranges from the bars to the minis which are smaller variants to satisfy consumers with smaller appetites or calorie-conscious consumers (refer to Table 1A: Product Range (Magnum 2011c)).

Magnum Double Caramel	Magnum Almond	Magnum Classic

Magnum Gold	Magnum Golden Hazelnut	Magnum Mini Liqueur

Magnum Mini (Classic, White and Almond)	Magnum Mini (Double Caramel & Double Chocolate)	Magnum Mini (Double Mocacchino)

Table 1A: Product Range (Magnum 2011c)

1.5 COMPANY’S PRINCIPAL PRODUCTS

The principal products of Magnum are its ice cream bars (refer to Table 1B: Principal Products).

	Features and Benefits
Magnum (Bar)	· Thick bar of vanilla ice cream covered with Belgian milk chocolate · Variations such as Magnum Classic, Magnum White, Magnum Almond and Double Caramel · High quality chocolate (Magnum 2011b)
Magnum Mini	· Comes in packaging of 6 mini magnum ice creams · Half the size of the bar · Snack size for calorie conscious consumers (Magnum 2011b)

Table 1B: Principal Products

1.6 POSITIONING OF PRODUCT

From its packaging and advertisements, it is evident that Magnum is trying to position itself as a high premium quality chocolate ice cream product for "pleasure seekers". The positioning strategy used by Magnum is targeted at the working class woman who can associate themselves with the advertising campaigns and slogans.

1.7 PRODUCT LIFE CYCLE STAGE

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Figure 1C: Product Life Cycle Stage (QuickMBA 2007)

Magnum is considered to be currently in the growth phase, as indicated by the red arrow (refer to Figure 1C: Product Life Cycle Stage (QuickMBA 2007)). The sales of Magnum have increased over the recent years as consumers are now more aware of this product through the expansion of intense television advertisements and creative marketing campaigns. Magnum's goal during this stage would be to gain consumers' preference and further increase their sales.

2.0 COMPETITORS

2.1 DIRECT COMPETITORS

Magnum has a number of direct and indirect competitors with its main direct competitor as  Häagen Dazs which competes against Magnum in the premium ice-cream category. Although both products adopt similar price strategies and distribution channels, they differ in their promotional strategies (refer to Table 2A: Magnum VS Häagen Dazs).

	Magnum (Double Caramel)	Häagen Dazs (Vanilla Almonds)
Product
Price	· SGD$14.50 per box of 4 ice-cream bars (refer to Appendix 6: POP Displays)	· SGD$15.90 per box of 3 ice-cream bars (refer to Appendix 7: Competitor’s Pricing)
Promotion	· Commercials · Radio and Internet · Printed media · Road Shows	· Printed media
Place	· Convenience stores: · Supermarkets	· Convenience stores · Supermarkets · Häagen Dazs outlet

Table 2A: Magnum VS Häagen Dazs

2.2 INDIRECT COMPETITORS

Magnum’s indirect competitors are shown in Table 2B: Indirect Competitors. These products target same market segments and they differ in terms of cost positioning from Magnum and Häagen Dazs.

	Cornetto (Royale)	Drumstick (Kit Kat)	Magnolia (Supremo)
Product
Price	· SGD$2.60 (refer to Appendix 2: Receipts)	· SGD$2.40 (refer to Appendix 2: Receipts)	· SGD$2.30 (refer to Appendix 2: Receipts)
Promotion	· Printed media · Internet	· Printed media	· Printed media
Place	· Convenience stores · Supermarkets	· Convenience stores · Supermarkets	· Convenience stores · Supermarkets

Table 2B: Indirect competitors

3.0 IDENTIFICATION OF TARGET MARKET

3.1 PRIMARY TARGET MARKET

Table 3A: Market Segmentation will further elaborate on the market segmentation of Magnum and its competitor, Häagen Dazs based on the demographics, psychographic and behavioural of the targeted consumers.

Table 3A: Market Segmentation

	Magnum Double Caramel	Häagen Dazs Vanilla & Almonds Bar
Demographics	· Target Market: Tertiary and working women aged between 18-40 years old. · Developed as a "premium adult offering” (Unilever 2011a). · Medium – High income levels with the ability to indulge in $14.50/box of 4 ice-cream bars (refer to Appendix 6: POP Displays)	· Primary Target Market includes: Male and Female professionals aged between 18-35 years old. · Häagen Dazs is well-known as a "super-premium brand” (Häagen Dazs 2011). · Medium – High income levels who love to indulge in $15.90/box of 3 ice-cream bars (refer to Appendix 7: Competitor’s Pricing)
Psychographics	· Activities: Entertainment - Gatherings - Leisure · Interests: Luxury food e.g. chocolate and ice cream · Opinions: Peer Influence - Word-of-mouth · Personality: Sociable, Indulgent, Fun-Loving	· Activities: Work and Entertainment - Entertaining business clients - Leisure - Family Oriented · Interests: Career, Family and Luxury food · Opinions: Task-oriented · Personality: Independent, Ambitious, Coy
Behavioural	· Benefits Sought: Pleasure and excitement, relieve stress and trendsetting among friends by making Magnum a fashion statement.	· Benefits Sought: Relieve stress, sensory taste and relaxing experience (Häagen Dazs 2011).
Behavioural	· User Status: “Potential Users, First-Time Users and Regular Users” (Beane and Ennis 1987).

Table 3A: Market Segmentation

3.2 POTENTIAL MARKET SEGMENTS

Euromonitor (2010) stated that while other food products suffered, ice cream profited from the recent economic recession as consumers see ice cream as a way to give themselves an incentive treat. Luxury food have only become a norm in today’s society. Therefore, this will not be an issue when selecting Generation X (1965-1976) as a potential market segment. The behavioural aspects of this generation consist of compulsive behaviour and high purchasing power, which ideally means that the possibility of targeting the age range of 40-45, will likely bring about profits as well (Roberts and Manolis 2000). Through the behavioural aspect of occasion, we can motivate purchases with the use of positive emotions.

Although, females are the major consumers of ice-cream, we recommend men of 18-45 years old as another potential market segment. Men do seek to satisfy their hunger, gratify their senses and to escape from the harshness of society, and chocolates do just that, in this case a sweet ice cream experience, “It's the perfect time for a movie and a sweet. I chose Troy, with Pitt in Achilles' shoes and a delicious Magnum” (Zarantonello and Luomala 2011). Males do have a simpler relationship with ice-cream due to their workaholic personality (psychological aspect), which might be easier to market, thus supporting our recommendation for potential market segment.

4.0 EXTERNAL INFLUENCES

4.1 CULTURE AND SUBCULTURE

The endorsement by Rachel Bilson has successfully portrayed Magnum to be the sought after ice cream choice for premium taste and pleasure seekers. Various commercials directed by renowned fashion director, Karl Lagerfeld painted Magnum to be the desired brand of ice cream for women who enjoy treating herself after a hard day’s work (Celentano 2011).

Our target segment appreciates and strives to seek a balance between work and leisure. They require acknowledgement and commendation for their achievements. Driven by their self-oriented culture of leisure, they are able to identify themselves. Placed as a premium ice cream in the minds of our target segment (Unilever 2011a), women would choose Magnum over competing brands when they want to reward themselves.

Being an Asian country infused with Western influences, there is an increasing culture of sensual gratification in younger Singaporeans. The culture of indulging oneself and fulfilling one’s cravings is on the rise. Hence, the advertisements stress on the sensual aspect to attract the target segment.

The aggressive and widespread promotional activities for the Double Caramel appeal to those in the ‘Early Adopters’ to ‘Early Majority’. Magnum had invited opinion leaders, such as bloggers, to grace their exclusive pleasure suite for a pure Magnum Double Caramel experience (Kiora 2011).

4.2 DEMOGRAPHICS

4.2.1 AGE

Age has an influence on the consumption of ice cream. It is often the younger generation who are greatly influenced by Western cultures that consumes ice cream, whereas the older generation perceives ice cream as an unhealthy product that should be savoured occasionally.

4.2.2 GENDER

Women are more emotional compared to men, who tend to be more rational. The consumption of ice cream is viewed as a form of stress relief as scientists have shown that chocolates “causes the brain to release endorphins” that causes the consumer to “feel good” (Ciampa 1996).

Therefore, during the purchasing process, women tend to look for products with chocolate content to soothe their senses. The endorsement by Rachel Bilson allows women to relate themselves to her, enabling them to achieve the same sense of happiness and relief.

4.2.3 SOCIOECONOMIC

The socioeconomic factor has a fairly low impact on the buying decision process as it requires low purchase involvement. Studies have shown the correlation between the financial status of a country and food consumption patterns (Drewnowski and Popkin 1997). Being a developed country with higher disposable income, Singaporeans are more willing to purchase luxury food such as ice cream on top of their basic three meals a day.

4.3 GROUP INFLUENCES

4.3.1 INFORMATIONAL INFLUENCES

Informational influences apply when consumers look towards the actions and views of reference group members for information of the product (Quester, Pettigrew and Hawkins 2011). When purchasing a low involvement product such as ice cream, women would not deliberate which brand to opt for. Instead, they would opt for the brand highly recommended by their friends.

4.3.2 NORMATIVE INFLUENCES

Normative influences occur when an individual acts according to the general behavior of the group to gain approval and to fit in (Quester, Pettigrew and Hawkins 2011). When purchasing ice cream, one would choose the brand that their peers consume. This action enables the individual to feel a sense of belonging to the group.

4.3.3 IDENTIFICATION INFLUENCES

Identification influences reflect the use of the group values as a benchmark for one’s attitudes or values (Quester, Pettigrew and Hawkins 2011). In the advertisements, Rachel Bilson is portrayed to be a successful woman who enjoys simple pleasures in life after a hard day’s work. This will attract young working women who are successful and seeking for a balanced life.

5.0 INTERNAL INFLUENCES

5.1 NEEDS AND MOTIVES

Latent motives are motives that are either unknown to the individual or are such that the individual is very reluctant to admit them (Quester, Pettigrew and Hawkins 2011). It could be that Magnum is an amazing ice cream that is sinful, yet more rewarding than other brands. Or that the consumer wants to feel what it is like to enjoy the ice cream. It may even be for consumers to show that “I am eating an ice cream that tells a story about me”, especially when the brand image of Magnum is about the confidence, carefreeness and the willingness or guts to achieve that hankering for pleasure.

Manifest motives are motives that are known and freely admitted (Quester, Pettigrew and Hawkins 2011). Ranging from simple motives such as consuming a premium ice cream, to having a reference group that only Magnum is able to bring about, portrayed by celebrities who endorsed the brand. Even the “telling a story about me” factor could be a manifest motive.

It is clear that Magnum has adopted the Approach-Avoidance motivation conflict, whereby the consumer faces both positive and negative consequences (Quester, Pettigrew and Hawkins 2011). As mentioned, Magnum is an ice cream that is sinful, yet more rewarding than it is sinful.

The new Magnum available in Singapore is built on the foundation from the existing brand image and the newly developed Magnum Double Caramel. The brand image created is sought after by consumers. Using Maslow’s hierarchy of needs (Quester, Pettigrew and Hawkins 2011), while Magnum may be a physiological necessity, it is more of an esteem need as it fulfills more of prestige, esteem and a sense of status.

5.2 PERCEPTION

Both positive and negative implications will arise as a result of perceptions.

The first and critical negative implication would be the concern on health issues associated with the consumption of the product. Senior nutritionist at the Center for Science in the Public Interest, Jayne Hurley commented that “Everyone knows that ice cream isn't good for you — it's a splurge. But most people don't realize how much of a splurge it is” (CBS News 2009). Secondly, marketing of Magnum ice cream is mainly targeted at female consumers. As such, it is very unlikely that majority of the male population will be regular consumers. Whilst Magnum may still be of a unisex category, there is a tendency that men will not consume Magnum when the brand image of the ice cream is intended for women.

However, not all implications are negative. The silver lining, in which is conjecturable that Magnum has intended, is that since marketing is mainly targeted at women, it builds a particularly strong relation with female consumers. Magnum is able to build an image in which consumers can relate to, such as the identity associated with consumption.

5.3 LEARNING

Learning refers to any change in the content or organisation of long term memory as a result of information processing (Quester, Pettigrew and Hawkins 2011). The learning phase of Magnum is crucial in the internal influences it will have on consumers.

With the exception of a minority of health conscious consumers who would compare the different brands, Magnum is generally a low-involvement learning product, where an advertisement brings attention to consumers and is not exactly information specifically sought after. It is up to Magnum to advertise and to stand out from the others, rather than the consumer’s initiative to seek the information.

Classical conditioning is the process of using an existing relationship between a stimulus and response to bring about the learning of the same response for a different stimulus (Quester, Pettigrew and Hawkins 2011). For the target market, Magnum does not simply seek to satisfy a desire for ice cream, it fulfills feelings and emotions. As the brand image suggests, the confident, busy, successful person would be satisfied through consumption of Magnum and the pleasure brought to them. “Seeing Magnum advertisement’s projected brand image (unconditioned stimulus) elicits a positive emotion (unconditioned response) in individuals. If the projected brand images are constantly paired with the product of Magnum, the product itself will elicit the same positive emotion (conditioned response)” (Quester, Pettigrew and Hawkins 2011). Therefore, learning is not informational but emotive.

5.4 LIFESTYLE

Targeted segments can be associated into lifestyle habits and purposes which are those who see Magnum as an instrument of stress relief, those who adopt the trend of eating Magnum through the influence of their peers, and those who simply wish to indulge in pleasure.

It is not uncommon that people seek ways to relieve stress in their daily lives. While others may kick back and enjoy a beer as a well-deserved reward after a hard day’s work, some seek refuge from stress through Magnum ice creams.

Peer influence is another lifestyle habit that affects consumers. Consumers generally do not wish to be left out by friends and family when the latter are thoroughly enjoying themselves eating the ice creams. As a result, consumers would not only sway towards buying Magnum to understand the motivations behind its consumption, but also as a display of social status and being seen as a “Magnum consumer”.

Understanding those who consume Magnum for the purpose of indulging in pleasure is straightforward. Majority of the consumers seek a primary desire to satisfy their need for indulgence. These people are driven by their needs and personal motivations to consume the product.

6.0 CONSUMER DECISION MAKING PROCESS

Addressing the decisions that influences a product purchase, consumer decision making process examines five main situations that engage a consumer. The process begins with ‘Problem Recognition’ where it compels the ‘Search for Information’. Consumers proceed with ‘Evaluation and Selection’ before they make a decision to purchase it at selected ‘Store Choices’. The process concludes with ‘Post Purchase Behaviour’ where expectations, performance and satisfaction are matched before the cycle repeats.

6.1 SEARCH FOR INFORMATION

‘Problem Recognition’ gives rise to the need for information search, leading to an increased awareness on a consumer product (Quester, Pettigrew and Hawkins 2011). It begins with the collection of internal information from prior taste experiences on Magnum ice creams.

Magnum Double Caramel targets its consumers through the better use of external search where external stimulus evokes the behaviours of consumers (Quester, Pettigrew and Hawkins 2011). Forums along with popular social network site, Facebook, serve as an information source where consumers gather the opinions of fellow Magnum buyers.

The availability of information is made through Magnum’s official website, magazine article reviews (refer to Appendix 3: Magazine Scans), direct experiences through product launch events (refer to Appendix 4: Direct Experiences) and promotional advertisements generated by the marketers (refer to Appendix 5: Marketer’s Promotional Efforts).

Classified as a ‘low level’ of purchase involvement, consumers find themselves in a ‘limited decision making’ where a simple point of purchase display (refer to Appendix 6: POP Displays) in a supermarket is enough to induce an interest in purchase (Quester, Pettigrew and Hawkins 2011).

In an awareness set, Magnum Double Caramel is classified under the ‘evoked set’ (refer to Figure 6A: Brands in Initial Awareness Set) where consumers highly regard these set of brands as a probable solution to their purchase decision (Quester, Pettigrew and Hawkins 2011).

Remaining impartial to the brands under the ‘inert set’, consumers resort to brands like ‘Cornetto’ in a case where ‘Magnum’, or brands under ‘evoked set’ are unattainable (Quester, Pettigrew and Hawkins 2011). Local brands like ‘Potong’, under the ‘inept set’ are overlooked due to lack of value and unfavourable views based on specific criteria of purchase (Quester, Pettigrew and Hawkins 2011).

Figure 6A: Brands in Initial Awareness Set

6.2 EVALUATION AND SELECTION

Consumers are likely to evaluate Magnum Double Caramel based on conjunctive decision rule where decisions are made once a minimum standard is met (Quester, Pettigrew and Hawkins 2011). The evaluation criterion covers price, taste, brand image, packaging, ease of consumption and nutritional content (refer to Figure 6B: Evaluation Criteria).

Figure 6B: Evaluation Criteria

6.3 OUTLETS & STORE CHOICES

The choice of outlets distributing Magnum Double Caramel sways consumer’s decision making where decisions are affected by the ‘Store Image’, ‘Retail Advertising’ and ‘Outlet Location and Size’ (Quester, Pettigrew and Hawkins 2011).

6.3.1 STORE IMAGE

A ‘Store Image’ can be detrimental to the brand image if the selection, quality and price offered by the specific store do not satisfy consumer needs. The placement of Magnum Double Caramel differs at outlets, where convenience stores usually house it in a freezer out of its store due to space constraints.

6.3.2 RETAIL ADVERTISING

The role of advertising is said to be one of the most effective tool in reaching out to its target audience (Quester, Pettigrew and Hawkins 2011). Price promotions at convenience stores (refer to Appendix 6: POP Displays) easily captivates consumer’s interest. Such appeal allows marketers to introduce bundle deals, in return increasing awareness on future brand extensions.

6.3.3 OUTLET LOCATION

Distribution of Magnum Double Caramel are mainly stocked and sighted at supermarkets and convenience stores where the purchase is made available anytime of the day. Giant, Cold Storage, 7 Eleven and FairPrice Xpress at Esso Mobil Stations are some of the leading carrying outlets (Magnum 2011a). Because of its convenient distribution, consumers are likely to approach the outlet first before considering the brand.

6.4 POST PURCHASE BEHAVIOUR

Dissonance is the dissatisfaction and feeling of discomfort experienced by the consumer after consumption of a product (Nadeem 2007). Questions as to whether customer’s needs are satisfied are answered in ‘Post Purchase’ behaviour. There is a low probability of post-purchase dissonance owing to the fact that decisions made during purchase are forthright, and there is no long-term usage of the product, unlike mobile phones or televisions.

It is important to identify any dissonance in the early stages of product consumption to encourage repeat purchases. An important way of reducing dissonance is to highlight its benefits in comparison to its competitors (Nadeem 2007).

6.5 DISPOSAL OF PRODUCT

There is little to none when it comes to the disposal of a food product specifically an ice cream. Disposal is almost not required (Quester, Pettigrew and Hawkins 2011). Although recycling and exchanging are inapplicable, Magnum Double Caramel is packaged into a box as well as a plastic wrapper and a proper disposal helps promote environmental wellbeing.

6.6 CUSTOMER LOYALTY

Loyalty is a clear commitment resulting from a rational decision based on an assessment of each brand’s benefits (Lichtlé and Plichon 2008).

Although brand loyalty does not assure a devoted loyal customer (Quester, Pettigrew and Hawkins 2011), skilful marketing is needed as customers are prone to purchase other Magnum products upon other brands.

Furthermore, loyalty reinforces consumer’s self concept of their belief towards the brand.

7.0 MARKETING STRATEGY

The following section shall examine the marketing approach engaged by Magnum Double Caramel ice cream bar and Häagen Dazs Vanilla and Almond ice cream bar to determine its market position and its success.

7.1 PRODUCT

Both Magnum Double Caramel and Häagen Dazs Vanilla and Almond are premium ice creams targeted to satisfy chocolate lovers. Magnum Double Caramel comes in the form of an ice cream bar (90g) and has positioned itself as a premium ice cream with its luscious chocolate coating, rich caramel sauce and thick Belgian milk chocolate. The golden brown packaging brings out the premium ‘feel’ of the product.

Similarly, Häagen Dazs Vanilla and Almond comes in the form of a ice cream bar (87g) and has also positioned itself as a premium ice cream, through finding the purest and finest ingredients and crafting them into the best ice cream.

The degree of innovation for ice cream is considered continuous, especially for Magnum as it often introduces new flavours annually to customize and satisfy consumer’s changing taste and preferences. The latest flavour Magnum introduces in 2011 is Double Caramel.

As ice creams are generally perceived by many Singaporeans as weight gaining, sinful delights, this may impede the rate of diffusion into the target market. Thus, one strategy Magnum has adopted is the endorsement of a celebrity, Rachel Bilson to star in the promotion of the Magnum Double Caramel. This allows consumers to alter such negative perceptions of ice creams.

7.2 PRICE

Price would be perceptible to consumers as an indicator of a product’s quality in relation to its brand, if the consumer is not knowledgeable on the product and its brand name (Schiffman and Kanuk 2007).

Price is an important evaluative criterion, as both Magnum and Häagen Dazs pricing strategy is based on the premium product pricing to attract status conscious customers. Berends (2004) suggests that the product’s prestige image and premium price is taken into consideration as part of the value provided in premium products pricing. Hence, Magnum and

Häagen Dazs have priced their products higher than competitors, in order to be perceived as a premium product. The higher price reflects the high quality of the ice cream in comparison to competitors.

The target market would likely respond to price reduction, as sales increases when prices are reduced. For example, Magnum launched a 1 for 1 deal for the Double Caramel at selected supermarkets to gain consumer awareness of the product through greater sales (refer to Appendix 6: POP Displays).

However, if the price reductions were too huge, consumers may change their perceptions of the product image, and no longer see it as a premium product, as prices is often used as a surrogate indicator for quality and status.

7.3 PROMOTION

Magnum’s Double Caramel is targeted as a premium chocolate ice cream for adults. Each Belgian ice cream bar is ready to satisfy one’s self indulgence. These are the values important to Magnum that can be used in the communication strategy.

On the other hand, the finest ingredients, along with the quality assurance that comes with Häagen Dazs trusted reputation is important values used in the communication strategy.

Magnum uses commercial advertising through different channels such as in TV commercials, websites and mobile advertisements. In the commercials, Magnum endorses Rachel Bilson to star in their commercials to promote the launch of the Double Caramel ice cream (Unilever 2011b). In addition, Magnum uses mobile advertisements on buses to promote the newly launch Magnum Double Caramel ice cream (refer to Appendix 5: Marketer’s Promotional Efforts).

These are effective forms of communication strategy as it allows Magnum to reach out to a wide target market of adults who enjoy chocolate indulgence. The greater market share of Magnum as compared to Häagen Dazs is evidence of their success in their communication strategy.

7.4 PLACE

Both Magnum Double Caramel and Häagen Dazs Vanilla and Almond adopt similar distribution systems, and can be easily found in major supermarkets and convenience stores such as NTUC, Cold Storage, Giant, Shop N Save, 7 Eleven and Cheers which have numerous outlets found at convenient locations.

With the presence of convenience stores carrying these ice creams, even as the working adults (Generation X and Y) become increasingly busy due to their hectic lifestyle, they will still be able to purchase the ice creams easily and readily.

8.0 EVALUATIONS AND RECOMMENDATIONS

8.1 EVALUATIONS OF ADVERTISING CAMPAIGN

Magnum makes use of isolation by using a light beige background in the print advertisement to captivate interest to the main focus of the celebrity (refer to Appendix 8: Print Advertisments). Häagen Dazs similarly applies the isolation technique; however colours were mostly dark and de-saturated thus making it less engaging than Magnum’s warm and inviting colours.

Magnum endorses a female celebrity in Rachel Bilson, whereas Häagen Dazs engages a non-celebrity model to endorse their products. Rachel Bilson portrays an endearing expression, which entices the target audience to take a second glance at the ice cream she holds onto. In contrast to Magnum’s direct approach, the model in Häagen Dazs advertisement portrays a seductive stare while holding a spoon, rather than the product, making it appear more sexual which may be provocative to some individuals.

Both brands seek to deliver a message of self indulgence through their products. Magnum’s slogan of ‘It’s pure pleasure, from the very first bite’ is easy for consumers to understand the intended message, as compared to Häagen Dazs’s ‘ANTICIPATED LIKE NO OTHER’, leaving consumers puzzled by their ambiguous message. Overall, the use of clear and straightforward advertising efforts by Magnum has proved to be more effective in delivering their intended message to the target audience as compared to Häagen Dazs (refer to Appendix 8: Print Advertisements).

8.2 FUTURE RECOMMENDATIONS

8.2.1 PRODUCT POSITIONING

Magnum should maintain its positioning strategy as a premium ice cream for the working class females. This positioning is aligned with its slogan, 'for pleasure seekers' aimed at females who desire to be relieved from their stressful lifestyle. Furthermore, competitors such as Cornetto has established a large market share in the lower tier ice cream market, hence it is inadvisable for Magnum to target this segment.

8.2.2 PRODUCT (GOODS AND SERVICES) ENHANCEMENTS

Improvements can be made to Magnum by adjusting its level of sweetness to appeal to men who do not have a sweet tooth like most women do (Gunnison 2011). The ice cream will be sold in the same double caramel flavor but with reduced sugar, enhancing the product image to both genders. An insulation pack to keep the product cool will be issued so that consumers can remain outside for hours, doing shopping, without any hassle.

8.2.3 IMPROVED MARKETING COMMUNICATIONS

Magnum can improve their marketing communications with consumers by featuring an interactive website, offering attractive prizes. Through this website featuring games, quizzes and facts relating to ice cream, Magnum is able to build up its potential customer database through the capture of personal particulars. This allows greater exposure and for consumers to have a lasting impression of the ice cream products, while creating a desire for it.

8.2.4 IMPROVED PURCHASE EXPERIENCE

The ultimate aim of Magnum is to provide its consumers with the entirety of satisfaction, consuming the product without any regrets. To achieve that, the idea of Magnum being unhealthy, such as the likelihood to cause diabetes and other health concerns, should be abolished. Product enhancements, as suggested earlier, allows this “guilty pleasure” experience of consumers to dissipate, and form a new perception that is simply “pleasure”.

8.2.5 IDENTIFYING POTENTIAL NEW CUSTOMERS

The current target market can be expanded by tapping into the male market. Similar to the age group of our targeted women, our potential market would be tertiary and working men between ages 18 to 40.

As Magnum can be perceived as a masculine brand due to its name and outlook, it does not require much repackaging. The ice cream is chunky in size, differentiating itself from the usual petite ice cream sizes (Gunnison 2011).

8.2.6 ENHANCING CUSTOMER SATISFACTION

Examining consumers brand loyalty along with their perceived quality towards Magnum grants an opportunity to enhance customer satisfaction. As relationship marketing is identified as the cornerstone of loyal consumers, Magnum ought to observe its consumer behaviour needs before marketing its price and promotions. Consumer relationships will be enforced, unfolding the possibilities of repetitive purchases. Magnum is encouraged to “under promise and over deliver” to ensure going beyond consumers’ expectations (Raphel 2004).

CONCLUSION

Magnum’s success is largely due to the marketing of their brand image. Revolving around this strategy, it has succeeded in reaching out to their target audience. It has captivated consumers and influenced their decision making process through the combination of external and internal influences. The understanding of consumer’s behaviour can be reflected in the success of Magnum’s marketing strategy. Thus, Magnum is able to stand out from the rest of its competitors, emerging as a top choice amongst premium ice creams.

WORD COUNT: 4477 WORDS

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APPENDIX 1A: VOLUME SALES

Sales of Ice Cream by Category: Volume 2005-2010

'000 litres	2005	2006	2007	2008	2009	2010

Frozen Yoghurt	-	-	-	-	-	-
Ice Cream Parlours	1,278.01	1,552.78	1,607.13	1,783.91	1,792.83	1,855.58
Impulse Ice Cream	2,936.59	3,019.25	3,084.95	3,154.94	3,286.12	3,426.61
- Multi-Pack Dairy Ice Cream	1,118.72	1,169.06	1,215.82	1,258.38	1,377.92	1,515.71
- Multi-Pack Water Ice Cream	-	-	-	-	-	-
- Single Portion Dairy Ice Cream	1,373.64	1,414.85	1,440.32	1,476.32	1,498.47	1,513.45
- Single Portion Water Ice Cream	444.23	435.35	428.82	420.24	409.73	397.44
Retail Artisanal Ice Cream	-	-	-	-	-	-
Take-Home Ice Cream	8,832.60	9,166.59	9,344.18	9,482.42	9,575.31	9,762.91
- Take-Home Dairy Ice Cream	8,832.60	9,166.59	9,344.18	9,482.42	9,575.31	9,762.91
-- Bulk Ice Cream	8,446.26	8,784.11	8,959.79	9,094.19	9,185.13	9,368.83
-- Ice Cream Desserts	386.34	382.48	384.39	388.24	390.18	394.08
- Take-Home Water Ice Cream	-	-	-	-	-	-
Ice Cream	13,047.20	13,738.62	14,036.26	14,421.27	14,654.26	15,045.10

APPENDIX 1B: SALES FORECAST

Forecast Sales of Ice Cream by Category: Volume 2010-2015

S$ million	2010	2011	2012	2013	2014	2015

Frozen Yoghurt	-	-	-	-	-	-
Ice Cream Parlours	39.98	41.65	42.93	43.98	45.06	46.16
Impulse Ice Cream	42.64	44.27	45.90	47.58	49.32	51.09
- Multi-Pack Dairy Ice Cream	18.27	20.19	22.10	24.09	26.14	28.23
- Multi-Pack Water Ice Cream	-	-	-	-	-	-
- Single Portion Dairy Ice Cream	21.81	21.64	21.44	21.23	21.00	20.74
- Single Portion Water Ice Cream	2.56	2.45	2.35	2.26	2.18	2.11
Retail Artisanal Ice Cream	-	-	-	-	-	-
Take-Home Ice Cream	70.50	71.14	71.71	72.22	72.66	73.04
- Take-Home Dairy Ice Cream	70.50	71.14	71.71	72.22	72.66	73.04
-- Bulk Ice Cream	66.10	66.76	67.36	67.90	68.38	68.79
-- Ice CreamDesserts	4.40	4.38	4.35	4.32	4.29	4.25
- Take-Home Water Ice Cream	-	-	-	-	-	-
Ice Cream	153.12	157.07	160.54	163.79	167.05	170.29

APPENDIX 1C: BRAND SHARES

Ice Cream Brand Shares 2006-2009

Brand	Company	2006	2007	2008	2009

Cornetto	Unilever Singapore Pte Ltd	18.08	18.61	19.15	20.16
Drumstick	Nestlé Singapore Pte Ltd	9.34	9.96	10.27	10.75
Magnolia	F&N Foods (S) Pte Ltd	7.77	8.02	8.75	7.97
Magnum	Unilever Singapore Pte Ltd	5.16	5.33	5.53	5.61
Häagen Dazs	General Mills Asia Pte Ltd	4.59	4.77	4.70	4.81
King's	King's Creameries (Singapore) Pte Ltd	3.82	3.83	3.77	3.80
Magic Cup	King's Creameries (Singapore) Pte Ltd	4.01	3.36	3.04	2.41
Fruiti	Unilever Singapore Pte Ltd	1.58	1.56	1.62	1.53
FairPrice	NTUC Fairprice Co-operative Pte Ltd	0.87	0.91	1.13	1.40
Cravio	F&N Foods (S) Pte Ltd	1.22	1.09	0.75	1.00
Cadbury's	Cadbury Singapore Pte Ltd	1.72	1.12	0.84	0.80
Crunch	Nestlé Singapore Pte Ltd	1.22	1.09	1.13	0.80
Traffic Light	Nestlé Singapore Pte Ltd	-	0.41	0.49	0.46
Carrefour	Carrefour Singapore Pte Ltd	0.17	0.18	0.19	0.20
Solero	Unilever Singapore Pte Ltd	0.71	0.67	-	-
Frutips	Nestlé Singapore Pte Ltd	0.47	-	-	-
Others	Others	39.26	39.07	38.65	38.29
Total	Total	100.00	100.00	100.00	100.00