IRIS (HSIAO-CHAN WANG) STACY (HSIN-YING LIN)PATTY (PEI-HAN WU) RITA (JING ZHAO) SILVIA CHAN

Direct Marketing Plan

Instructor: Marc Hsu

Agenda

Coffee Industry Overview Blue Bottle Coffee Company

Overview Direct Marketing Strategy Budget & Financial Info Evaluation

Direct Marketing PlanInstructor: Marc Hsu

By Iris (Hsiao-Chan Wang)Stacy (Hsin-Ying Lin)

Patty (Pei-Han Wu)Rita (Jing Zhao)

Silvia Chan

Industry Overview

Marketplace Micro-environment

•Heavy regulations on the coffee industry

Political

•Consumers have tightened their consumption patterns

Economic

•Consumers are spending more on coffee in the retail stores

Socioeconomic

•Coffee manufacturers need to provide info about products on the website

Technological

Company Overview

Company Overview

Productscoffee beverage

home baked pastry

roast coffee bean

5 locations in bay area, 1 store in NYC

Mission

Founded in 2002, a SF-based coffee roaster

Strengths

Fresh roast coffee bean Timely orderWell-known coffee regionsMulti- channel strategy Useful info on the website

Weaknesses

Few locationsLow awarenessLimited service

Hard to attract new customerVague brand image

Unorganized marketing departmentOpportunities

Create a email blast Increase sales by giving samplesCreate reward programs for loyal clientsInvolve in promotional events Expand product lineOpen new coffee stores

Threats

Competitiv e coffee industryStrong competitors

High substitute

SWOT

Competitive Situation

Ritual Coffee Roaster Starbuck & Peet’s coffee

Product

“We roast your coffee when you place the order ”

Diverse Coffee Selections•Fresh roasting coffee

bean•Single origins or blends •(Yemen, Ethiopia,

Mexico, Chiapas & Switzerland)

•Price range from $17 to $25

Target Market

Demographic• Aged 35-45, working

professionals• Aged 55-65, retired

couples• Well-educated, higher

income level

Psychographic• Coffee lovers

• People are taking pleasure of brewing homemade coffee.

Goals & Objectives

Acquire new members of Blue Bottle coffee club

Increase web store visiting and web site traffics

Strengthen relationship with current customers and prospective customers

Increase customer average amount of spending

Marketing StrategyMarketing Strategy

Market Conditions

Increase awareness

Create an attractive website

Add a blog

Deliver customer

value

Encourage subscriptions

among current

consumers

Use direct marketing

tactics

Differentiate among

competitorsFocus on 48 hour roasting strategyIncrease customer relationshi

ps

Postcard

Postcard

Objective

• Inform consumers about our coffee club

• Offer consumers a free sample

Use 3 different lists

• Introduce the country of origin of the coffee bean

• Encourage consumers to visit the website

Front

Back

Response Mechanism/Tracking Code

Call to Action

Info of coffee regions

Banner Ad

Banner Ad

Offers

• Click here for 10% off New Blue Bottle Coffee beans

• Register to receive Free Blue Bottle Coffee beans sample.

Creative Approach

(Increasing the CTR)

• Include a "click here"

• Outline the benefits "free samples"

Banner Ad

Pricing

Activation Fee: $5

CPM$15

Testing

Design formats

Keywords

Placements

Example Banner Ad Size

Leader Board Image Ad (728 x 90)

Register to receive FREE sample of Blue Bottle Coffee bean

Click here for 10% off Blue Bottle Coffee beans

Large Rectangle (336 x 280)

E-mail Blast

Email Blast-coffee club

Acquire new members and invite current customers to join our Blue Bottle Coffee Club:

Best coffee of the month

A subscription-based club

Monthly selection coffee bean

Email Blast-coffee club

• Free trail of our new selection coffee bean

• Early Bird registration for latest events ex: coffee workshop/anything about coffee

• 10% discount when customers order a 2nd package

• Members order more than 3 packages of coffee bean within a month, they received a coupon of free coffee beverage

Offers: Members Only Benefit

Magazine

Magazine

Offers

10% off coupon

A free sample of coffee beans

after registration

Creative Approach

Insert mediaBlue Bottle Coffee

trademark; 800-phone #; promotion

codeMagazine pageAn interactive device;

show steps to a special URL & enter code

Creative-Magazine Page

Magazine

Media Sunset Real Simple Cooking Light Food & Wine

Pricing & Price Promotion The four-color full page price is $114,900 per month Insert card (4 x 6) size page, it costs $91,920 per month

Testing Utilize insert cards to test and track during the first three

months Select top two insert cards with higher response rate and use

the interactive smelling sample in the next nine months

Budget & Financial Info

CPA (Cost Per Acquisition)

Customers/

Orders• 3,988

Total Cost

• $219,385

CPA• $55

Budget

Fixed Cost• $254,385

Variable Cost• $150,600

Total Cost• $404,985

Budget

Fixed Cost• $254,385

Variable Cost• $150,600

Budget• $404,985• $450,000

How to Measure Financial Success

1 2 3

-$40,000

-$20,000

$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

-$28,485.

$142,920

$97,740.

Profit & LostCustomer Lifetime

Value

1 2 3

-$20

-$10

$0

$10

$20

$30

$40

$50

$60

$70

-$9.46

$33.68

$60.50

Evaluation

Determine which channel is the most

preferred by customers

Deliver good customer service.

Focus on customer

retention and improve its

services

Evaluate everything and make changes