mark 3339 final project_final
TRANSCRIPT
Marketing Strategy PlanTeam 7
for Blue Bell Creameries
Marketing Strategy MARK3339
As Prepared by: Robert FloresLuke Shaver
Oluwapelumi BodundeQuynh Ho
Barbara Olivera
Copyright © 2016 Team 7All Rights Reserved
Dr. John KaronikaUniversity of Houston
Spring 2016
Copyright 2016 Team 07 Spring 2016. All Rights Reserved.
1
Executive Summary
A. Purpose and Scope
The Blue Bell Creameries Marketing Strategy Plan blends research and
solutions into comprehensive report, guiding us through in-depth analysis
needed to create expansion forecasting 3 years ahead. This plan provides
desired outcomes, preferred marketing mixes and steps to execute a
tactical action plan. Furthermore, into how to make the marketing gears
mesh, evaluate progress, and oversee success. Financial information,
budgets, and research sources wrap up the plan.
B. Current Situation
Blue Bell is a frozen dairy product and ice cream manufacturer. They
control every aspect of their business. Our target market sits around $5B
dollars. Blue Bell captures 11% of market share. The ice cream
manufacturing market is in its mature stages. Environment is stable and
competition is well established.
C. Key Aspects of the Marketing Strategy Plan
We adopt an improve position strategy by a growing marketing budget.
Projected market share is to grow 2% a year from 11% to 17% and profit
shall grow 35% by 2017. Expected Sales climb from $568M to $855M with
Gross Margin expanding $173M to $261M. Net Marketing Contribution is
$165M forecasted to grow to $244M. Net Profit is $25M increasing to
$38M by 2017.
Copyright 2016 Team 07 Spring 2016. All Rights Reserved.
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Table of Contents
Executive Summary 2
Table of Contents 3
Introduction 5
I. Environmental Analysis 7
A. External Analysis 7
B. Internal Resources Analysis 15
II. SWOT Analysis 21
A. Summary of Key Strengths and Weaknesses 21
B. Summary of Key Opportunities and Threats 24
C. Key Performance Issues 27
III. Portfolio Analysis & Strategic Market Plan 28
A. Portfolio analysis 28
B. Strategic Market Plan 31
C. Business performance 33
IV. Marketing Objectives 35
A. Product Line 35
B. Target Market 36
C. Positioning Strategy Statements & Value Proposition 36
D. Goals and Objectives (Sales Volume, Market Share, Net Marketing, Profit,
etc.) 37
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V. Marketing Mix Strategy 40
A. Marketing Strategy Alternatives 40
B. Marketing Strategy and Positioning 40
VI. Tactical Action Plans 43
VII. Implementation, Evaluation and Control 44
A. Performance Measures 44
B. Monitoring and Evaluation Procedures 44
VIII. Financial Projections 46
A. Financial Projections 46
B. Marketing Expenses Budget 47
IX. References 49
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Introduction
We chose this company because Blue Bell offers delicious ice cream that at the
same time is facing the challenge of overcoming the listeria outbreak in the past year.
This pause in productivity and seemingly public relations nightmare pushed us to take
interest in Blue Bell. This paper will discuss our team’s research into the company and
offer our provided solutions to the company in regards to how to become harder, better,
faster, and stronger in the marketplace for ice cream sales.
Blue Bell grinded to develop from its humble beginnings in Texas to get to where
it is today. As the company maintains control over manufacture and supply chain of its
products, they are not expanding as they once were.
Blue Bell in recent history is facing challenges because for a year they were out
of production. After the listeria outbreak, many employees have been laid off, and the
company struggled to get back on-line. Still to this day, their production ramp-up is not
complete and many product variations are not purchasable. As time goes on, they push
to regain strength and earn back the trust of their former consumers.
Team Seven consists of five members: Oluwapelumi Bodunde, Robert Carlos
Flores, Barbara Olivera, Quynh Ho and Luke Shaver. Oluwapelumi, or Mary for short,
contributed to our Introduction and marketing mix. Robert focused on developing a solid
Strength-Weakness-Opportunity-Threat analysis and the portfolio analysis & strategic
market plan. Barbara and Quynh created our Environmental Analysis. Also Barbara
created the tactical action plans and the implementation, evaluation and control. Quynh
created the Marketing objectives. Luke developed the Key Performance Issues and the
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Financial projections. We all worked together to create this marketing strategy plan for
our company Blue Bell.
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I. Environmental Analysis
A. External Analysis (Opportunities and Threats)
1. Marketing Strategy:
Blue Bell ranks as one of the top three, best-selling ice creams nationwide
despite the company's products being available in about 26% of US supermarkets.
Even though the company keeps a roster of creative flavor combinations, its
Homemade Vanilla is its top selling flavor (Vault, 2016). While some competitors have
slimmed down the size of their ice cream containers to maintain profit margins, Blue Bell
asserts that its ice cream will retain its true half-gallon size. And to keep its customers
coming back for favorite flavors while trying new ones each year, the creamery boasts
an active product development group that churns out new flavors, such as its Rocky
Mountain Road. (Hoover,2016)
The goal of this plan is to set clear objectives that can be achieved within a year.
Increasing market share, sales, social media presence and brand awareness are
necessary steps to follow.
1) Industry Analysis
a. Market Potential and Market Demand
The company is among the top sellers of ice cream nationwide, with 2003 sales
of $400 million, while its products are distributed only in 15 states. Based in Brenham,
about 70 miles northwest of Houston, Blue Bell claims it is the nation's No. 3 best-selling
ice cream brand behind Oakland, Calif.-based Dreyer's with $1.2 billion in sales in 2003
and Green Bay, Wisc.-based Breyers with $660 million (Bizjournals,2005).
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b. Served Market
In 1989, Blue Bell began selling its ice cream in Oklahoma, and throughout the
1990s expansion pushed throughout the South Central and Southern United States,
eventually expanding out to New Orleans and Jackson, Mississippi. In all, Blue
Bell products are available in 23 US states, including Alabama, Arizona, Arkansas,
Colorado, Florida, Georgia, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Missouri,
Nevada, New Mexico, the Carolinas, Oklahoma, Tennessee, Texas, Virginia, and
Wyoming (Hoover,2016). It maintains nearly 60 distribution facilities throughout the US.
Blue Bell ranks as one of the top three, best-selling ice creams nationwide despite the
company's products being available in about 26% of US supermarkets (Vault, 2016).
c. Market Share
Blue Bell is already working on expanding product sales to close states it thrives
in. In 2012 the ice cream maker expanded into Research Triangle region of North
Carolina, after entering Charlotte eight years prior. In 2011 Blue Bell entered Colorado
and the South Florida market. The ice cream maker also built office and cold storage
facilities in Tampa, Florida, and a distribution warehouse near Nashville, Tennessee, to
support deliveries directly to foodservice operators and grocers in those areas. This
gives the company the opportunity to increase sales, brand awareness, and brand
loyalty in other states. This all leads to Blue Bell becoming first in ice cream market
share (Bluebell, 2016).
The statistic depicts the market share of the leading ice cream vendors in the
United States in 2015, based on sales. In that year, Blue Bell Creameries hold a market
share of 11.3 percent in the United States, based on sales of 570 million U.S. dollars.
Copyright 2016 Team 07 Spring 2016. All Rights Reserved.
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The company owns the popular ice cream brand Blue Bell. Chocolate, vanilla and
cookie dough/cookies and cream were among the leading ice cream flavors in the
United States in 2013. The company's 70 flavors are big in Texas, holding a 61 percent
market share in Houston, and a 63 percent share in Dallas/Fort Worth, according to
company marketing materials. It has manufacturing plants in Oklahoma and Alabama
(Hoover,2016).
d. Market Environmental
Blue Bell produces can only be found in a small portion of the country, which is
why we still think of ourselves as a little creamery. However, due to high quality
products and loyal consumers, Blue Bell is the number three ice cream brand in the
United State. In all, Blue Bell products are available in 23 US states, including Alabama,
Arizona, Arkansas, Colorado, Florida, Georgia, Indiana, Kansas, Kentucky, Louisiana,
Mississippi, Missouri, Nevada, New Mexico, the Carolinas, Oklahoma, Tennessee,
Texas, Virginia, and Wyoming (Bluebell, n.d.)
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Industry/Market Analysis of Opportunities and Threats
OpportunitiesProbability Impact Timing
Expanding product sales to close states. 0.5 H N
Products are available in 23 US states 1.0 H N
Ranks as one of the top three, best-selling ice creams
nationwide0.5 M N
Threats Probability Impact Timing
Many competitors in market (Share the same target
audience as Blue Bell)1.0 H N
No social media presence. 0 C M
Competitors with similar products. 0.5 M N
Share the same target audience as Blue Bell 1.0 H N
1. Probability is likelihood that the event or condition will occur.
Scale: 0 to 1.0 1.0 = 100%
2. Impact is the eventual impact on the business. Scale: C, H, M. & L
C = crisis, H = high, M = moderate, L = low
3. Timing is when the issue or condition will likely occur.
Scale: N, M. & L.N = near-term (during the plan year), M = medium-term (no sooner than 2 years), L = long-term (no sooner than 5 years).
Copyright 2016 Team 07 Spring 2016. All Rights Reserved.
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2. Customer Analysis
a. Customers
I. Served Market
Everyone (included Children & Adults)
Families
II. Customers
Our largest customers will be Adults with children of various ages have high
indexes and are more likely to eat Blue Bell Ice Cream across the board. Homemakers,
or possibly stay-at-home moms, are 29% more likely to eat Blue Bell Ice Cream, and
adults who are married are 11% more likely to eat Blue Bell. Adults with 5 or more
people in the household are 15% more likely to eat Blue Bell (Alyssa Bordelon, 2016).
Copyright 2016 Team 07 Spring 2016. All Rights Reserved.
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Customer Analysis of Opportunities and Threats
Opportunities Probability Impact Timing
The third largest ice cream maker (250 products and 45
flavors available across the South)1.0 H N
Blue Bell retains its true half-gallon size 1.0 H N
Threats Probability Impact Timing
Many competitors in the market (Customers get more
choose)1.0 H N
Consumers are increasingly health conscious. 1.0 H N
1. Probability is likelihood that the event or condition will occur.
Scale: 0 to 1.0 1.0 = 100%
2. Impact is the eventual impact on the business. Scale: C, H, M. & L
C = crisis, H = high, M = moderate, L = low
3. Timing is when the issue or condition will likely occur.
Scale: N, M. & L.N = near-term (during the plan year), M = medium-term (no sooner than 2 years), L = long-term (no sooner than 5 years).
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3. Competitive Analysis
a) Competitor Identification
Breyers: Top brand ice cream in the US.
Haagen-Dazs: available in 80 countries worldwide.
Dreyer’s/Edys’: distribution reaches 70% of US household.
b) Competitors' Advantage (Cost-Differentiation-Marketing)
The top-rated ice creams are really high in fat. But there very good ones that
have about half the fat and are also lower in price. Those are Breyers, Great Value,
Baskin-Robbins, Nice, Tillamook, Blue Bell, Turkey Hill, Dreyer’s/Edy’s, Friendly’s, and
Blue Bunny (Ashley Reynolds, 2014).
c) Key Competitors Market Position & Trends
Our major competitor, Breyers, surpasses Blue Bell’s market share by 4.9%. Our
goal is to dominate our target market in the South to ultimately increase our market
share by 5% and become the number one ice cream brand in the United States. By
implementing multiple new advertising platforms, we plan to further reach our target
audience and increase sales among homemakers and adults with families by up to
20%. (Hoover,2016)
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Competitive Analysis of Opportunities and Threats
Opportunities Probability Impact Timing
Appeal to the health oriented market with their less fattening
“frozen dairy desserts”0.5 M M
Product differentiation to appeal to larger segment 1.0 H N
Threats Probability Impact Timing
Reduced their half gallon size twice 0.5 H N
Many competitors in the market 0.5 H N
1. Probability is likelihood that the event or condition will occur.
Scale: 0 to 1.0 1.0 = 100%
2. Impact is the eventual impact on the business. Scale: C, H, M. & L
C = crisis, H = high, M = moderate, L = low
3. Timing is when the issue or condition will likely occur.
Scale: N, M. & L.N = near-term (during the plan year), M = medium-term (no sooner than 2 years), L = long-term (no sooner than 5 years).
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B. Internal Resource Analysis
1. Marketing and Distribution
a. Competitive Structure and Market Share
With the frozen dairy market dominated by four companies
that constantly stand out in both sales numbers, popularity,
and now seeking how to expand to newer levels.
Our points of entry will include expansion of retail (mostly
through grocery and convenience stores our product has not
reached yet), and expansion of specialty retail (mostly at
special quantities for university retail stores and shopping
malls).
b. Advertising and Promotion Skills
Our company would focus its resources into creating new
way to promote our product when moving into new
territories. The primary way in, which we plan to expand
advertisement of our company into new territory, will be
mostly word-of-mouth and ads inside grocery stores.
c. Effective Channels of Distribution and Geographic Coverage
In order to expand into other states, mostly to the north of
the United States, our company would have to open two
more manufacturing facilities, preferably in South Dakota
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and Minnesota in order to satisfy the demand of the product
in this region of the country.
2. Research and Development/Engineering/Manufacturing
a. Well-equipped Laboratories and Test Facilities
Our company, even after the Listeria outbreak in 2015, has
demonstrated it is up to date with its testing facilities and
safety/sanitary conditions. After the outbreak in 2015, Blue
Bell demonstrated it is capable of controlling this type of
problems when they become present, both by completely
controlling the situation sanitarily and socially.
b. Efficient and Effective Procedures: Design, Scheduling and
Quality control
As mentioned before, after our company was struck with the
outbreak of Listeria in one of its manufacturing facilities, we
were able to demonstrate our quality control and design
structure is up to date to control any type of problem that can
become present in the manufacturing process.
3. Corporate Resources and Personnel
a. Corporate Image and Prestige
Being one of the major frozen dairy product producers in the
United States, our company maintains its place in the
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corporate world being in the top five biggest frozen dairy
products.
With annual sales of our company being estimated at around
$582.70M, Blue Bell Creameries is at the top five biggest
companies that dedicates to the production of this product,
and possibly the number one company that relies 100% of
its revenue just in the frozen dairy market. (Hoover’s, 2016)
b. Loyalty of Customers
There are a few times in the history of companies in which
loyalty of customers is actually tested, and in 2015 Blue Bell
Creameries had its first recall in 108 years of history.
After the first recall even in 2015, our company came back to
its prestigious position in the market due to the loyalty of our
customers and their trust in the quality of the ice cream.
Customers loyalty alone demonstrates the fact that
expansion is completely possible and achievable, and it can
even produce more loyal customers after advertisement for
expansion is put in effect.
4. Finance
a. Access to Capital
With an estimated net worth of $1.66 billion, and estimated
annual sales of $582.70M; being active in less than half of
the states in the United States, our company would
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obviously benefit from the expansion from 23 to possibly the
whole country. (Hoover’s, 2016)
Being able to expand would lead our company to the top of
not only the biggest frozen dairy product producers in the
United States, but one of the leading and biggest
companies in the northern hemisphere, and would also
expand the net worth and annual sales of the company.
b. Total Financial Resources and Strength
Expansion of Blue Bell would obviously use up a
considerable amount of revenue, but with the correct
expansion plan and taking the right decisions will make the
transition to new states in the country smooth, and will give
the company new horizons to cross.
5. Primary Competitive Advantage
With the expansion in the Blue Bell Creameries, there are a
considerable amount of advantages over changing
distribution from 23 states into the whole United States.
Our company would be able to expand its net worth greatly
without the need of using more advertising and production
resources.
Our company is already adding and removing more flavors
every day, which boosts popularity in the existing
distributing states.
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Competitive Analysis Summary
Opportunities Probability Impact Timing
Brand Awareness in Active Markets 0.9 M N
Social Media Presence 1.0 H N
Customer Loyalty 0.9 M N
Threats Probability Impact Timing
Listeria Outbreak Damage to Market Position 1.0 C M
Competitive Market 0.25 H N
Health Conscious Consumers 0.75 H N
1. Probability is likelihood that the event or
condition will occur.
Scale: 0 to 1.0
1.0 = 100%
2. Impact is the eventual impact on the
business.
Scale: C, H, M. & L
C = crisis, H = high, M = moderate, L = low
3. Timing is when the issue or condition
will likely occur.
Scale: N, M. & L.
N = near-term (during the plan year),
M = medium-term (no sooner than 2
years), L = long-term (no sooner than
5 years).
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Internal Resources Analysis Summary
Strengths Ranking Trend
Quality in the Production of their Product D I
Supporting Resources A D
Family Owned Business Relatable to Customers D N
Established Brand Recognition A D
Weakness Ranking Trend
Tarnished Reputation – Listeria A D
Very Minimal Advertising to Promote Product D N
Product Availability Limited to Twenty-Three States D N
1. Ranking is a measure of the magnitude of a
strength or
weakness.
Scale: D, A, & I. D = dominant, A = average, I
= insignificant.
2. Trend is an indication of the direction of
change of the
strength or weakness.
Scale: I, N, & D. I = increasing, N = no
change,
D = decreasing.
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II. SWOT Analysis
Summary of Key Opportunities and Threats
Opportunities Probability Impact Timing
Supporting Local Businesses 1.0 H L
Expanding product sales to close states. 1.0 H N
Products are available in 23 US states 1.0 H N
Ranks as one of the top three, best-selling ice creams
nationwide1.0 H N
The third largest ice cream maker (250 products and 45
flavors available across the South)1.0 H N
Blue Bell retains its true half-gallon size. 1.0 H N
Product differentiation to appeal to larger segment 1.0 H N
Appeal to the health oriented market with their less
fattening “frozen dairy desserts” 1.0 M M
Threats Probability Impact Timing
Listeria Disease 1.0 H N
Many competitors in market (Share the same target
audience as Blue Bell)1.0 H N
No social media presence. 0 C M
Many competitors in the market (Customers have more 1.0 H N
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options)
Consumers are increasingly health conscious. 1.0 H N
Reduced their half gallon size twice 1.0 H N
1. Probability is likelihood that the event or condition will occur. Scale: 0 to 1.0
1.0 = 100%
2. Impact is the eventual impact on the business. Scale: C, H, M. & LC = crisis, H = high, M = moderate, L = low
3. Timing is when the issue or condition will likely occur. Scale: N, M. & L. N = near-term (during the plan year), M = medium-term (no sooner than 2 years), L = long-term (no sooner than 5 years).
Blue Bell does a great job of exploiting the concept of supporting your local
businesses. People always feel more comfortable buying and supporting the local
businesses within their own community. Blue Bell does so much for fundraisers, and
donates millions of dollars a year to their hometown in Brenham. Anything from
hospitals to sporting complexes, Blue Bell has helped build their reputation by donating
millions of dollars. (Industry/Market Analysis Table) When opportunities to give back to
the community like this present themselves, it is just another way to really ensure that
your customers will be loyal lifelong customers. They were faced with the opportunity to
respectfully recall all the products; now they're faced with the opportunity of finding and
securing the source of the problem, and training their employees with the new
procedures to avoid this matter. If they waited until the FDA made them recall the
products it would have cost twice as much money in the long run, but because they did
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this on their own the could have possibly saved the company as a whole.
(Environmental Analysis)
After all the latest news about Blue Bell creameries, it is safe to say that the
biggest threat currently is their products containing the listeria disease. This does not
assign this factor as a weakness, because this is in fact a threat. Because of the listeria
disease Blue Bell’s sales have completely stopped, and they are spending countless
dollars fixing the problem. (Customer Analysis Table) Other threats that all companies
face, are the threats from other companies ironically. When I say threats from another
company I mean friendly competition of course. Blue Bell will always have competitors
in the ice cream market threatening them with their ice cream. The battle for customers
and their customer loyalty is huge, but then that's when it comes down to the quality of
the product. People expect great quality ice cream from such a name brand product like
Blue Bell. (Competitive Analysis Table)
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Summary of Key Strengths and Weaknesses
Strengths Ranking Trend
Quality in the production of their product D I
Supporting Resources A D
Family owned business relatable to its consumers D N
Established brand recognition through decades of business A D
Creating new flavors while still maintaining signature flavors D I
Keeping things fresh by updating options for consumers D N
Large 64oz. Containers D N
Weakness Ranking Trend
Tarnished Reputation as a result of 2015 recall A D
Very minimal use of advertising to promote product D N
Product availability limited to 23 states only D N
High amount of trucks and routes used for distribution D N
Health issues associated with the brand such as Listeria D I
1. Ranking is a measure of the magnitude of a strength or weakness. Scale: D, A, & I. D = dominant, A = average, I = insignificant.
2. Trend is an indication of the direction of change of the strength or weakness. Scale: I, N, & D. I = increasing, N = no change, D = decreasing.
Blue Bell has a lot of strengthens, and even through these hard times they are
experiencing, their strengths are presenting themselves even more. Blue Bell’s internal
capabilities are their greatest strength, because they are capable of creating new
flavors, and always keeping things fresh, while still selling the classics like vanilla,
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chocolate, etc. When it comes to the marketing aspect this is huge, because it is
important to be able to keep things new, and to always have new products produced.
Blue Bell also does a great job of making the decision of marketing certain flavors
seasonally, or during certain periods of time. Another strength of the Blue Bell
Creameries Company is the quality of their ice cream. Blue Bell has been able to keep
amazing quality about their products over the years. The reason why Blue Bell is one of
the top vendors of ice cream in America is, because their ice cream has such great
quality. Another one of Blue Bells strengths is their supporting resource. I'm not talking
about the milk used to make the ice cream, or the other ingredients that are put into the
ice cream. I am talking about the community that surrounds Blue Bell. The community
and employees that are involved and exposed to Blue Bell are a resource to the
company all by themselves. Since the listeria crisis, many citizens and workers have
shown nonstop support for the company. This represents strength, because while Blue
Bell is down and in the rut trying to fix the problem within the production plants, they
know they are not losing valuable customers day in and day out. (Internal Resources
Analysis Table) A company can have amazing strengths and utilize them to their best
ability, but having just a few minor weaknesses can cause a company to crumble if not
handled properly. The main weakness that Bluebell has that might not even be looked
at, as a weakness, is their size. Blue Bell has 668 distribution routes. The convoy and
equipment contains a combination of 1,534 trucks and different equipment. It is not
easy to manage a company that is located in over 20 plus different states. You run into
the risk of quality control and health issues. The listeria issue is a great example,
because I am sure it got looked over for years. There are so many plants where Blue
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Bell products are made, and so many farms were Blue Bell’s ingredients are made that
it is virtually impossible to have known that listeria had infected their products. Blue Bell
does an amazing job at running their company and maintaining quality, but size can be
a weakness. When you have a company as big as Blue Bell’s, any little mix up with the
production of your product could cost you millions of dollars. The marketing issue with
the listeria disease has already cost the company millions of dollars. Blue Bell
creameries faces rate of expansion.
The numbers do not lie, Blue Bell is one of the most popular vendors of ice
cream in the United States based on sales, but you can only find them in 23 states. For
a company that has been around for over 100 years and is so well liked you would think
they would be everywhere across America by now. They could dominate the ice cream
industry and become a monopoly in a sense. Due to their lack of expansion at a faster
rate it is categorized as a weakness. (Internal Resources Analysis Table)
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Key Performances Issues
1. Large “Cold” Supply Chain to Manage (see page 23)
Blue Bell has to manage its entire supply chain and provide excellent quality control. If
they do not, they risk melted ice cream deliveries and possibility for another disease to
spread.
2. Damage to Reputation and Sales from Listeria Outbreak (see page 23)
The listeria outbreak took Blue Bell out of the ice cream market. While they were
offline, many sales were missed and customers started distrusting their products. They
need to overcome this obstacle to return to former market position and growth.
3. Limited Marketplace – Available in Only 23 States (see page 23)
The company operates primarily in the southern United States. Potential sales growth
waits in other markets in the US. If they are to grow in size and scope, expansion to
other states seems opportunistic looking forward.
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III. Portfolio Analysis & Strategic Market Plan
A) PORTFOLIO ANALYSIS
Template to determine Marketing Attractiveness Multifactor Index:
Market Attractiveness Index
Very Unattractive Unattractive
Somewhat Unattractive
Somewhat Attractive Attractive Very Attractive
0 20 40 60 80 100
Market Attractiveness Factors
Market Attractiveness
RatingRelative
Importance
Market Attractiveness
Score
Market Forces
Market Size 60 15% 9
Rate Growth 70 15% 10.5
Buyer Power 30 30% 9
Customer Loyalty 100 40% 40
Market Forces Total 68.5 x Relative Importance of Market Forces 25% 17.13
Competitive Intensity
Number of Competitors 90 25% 22.5
Price Rivalry 80 30% 24
Ease of Entry 60 10% 6
Substitutes 100 35% 35
Competitive Intensity Total 87.5 x Relative Importance of Competitive Intensity 35% 30.63
Market Access
Customer Familiarity 60 45% 27
Channel Access 80 30% 24
Sales Requirements 70 25% 17.5
Market Access Total 68.5 x Relative Importance of Market Access 40% 27.4
Market Attractiveness Index 17.13 + 30.63 + 27.4 = 75.16
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1. Market Attractiveness
Bluebell Creameries carries an overall market attractiveness score of 75.16 (out
of 100). Based on sales, Blue Bell is one of the most popular vendors of ice cream in
the United States, despite being available in only 23 states; they are currently
dominating the market force in the ice cream industry. (Hoover,2016) Blue Bell will
always have competitors in the ice cream market threatening them with broader
accessibility to their ice cream products nationwide. Although the battle for customers
and customer loyalty is huge in the ice cream industry, but then that's when it comes
down to the quality of the product and Blue Bell excels in delivering quality ice cream.
Blue Bell is located in 23 states, but they are currently second place in overall sales,
nationwide. (Hoover, 2016) This is due to the outstanding quality of their ice cream.
Blue Bell will improve their current advertising approach to introduce all the products
they have to offer and acquire more consumers.
Template to determine Competitive Advantage Multifactor Index:
Competitive Advantage Index
Major Disadvantage
Definite Disadvantage
Slight Disadvantage
Slight Advantage
Definite Advantage
Major Advantage
0 20 40 60 80 100
Sources of Competitive Advantage
Competitive Advantage
RatingRelative
ImportanceCompetitive
Advantage Score
Differentiation Advantage
Product Quality 100 30% 30
Service Quality 90 15% 13.5
Brand Image 80 25% 20
Relative Price 100 30% 30
Differentiation Advantage Total 93.5
Copyright 2016 Team 07 Spring 2016. All Rights Reserved.
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x Relative Importance of Differentiation Advantage 30% 28.05
Cost Advantage
Unit Cost 80 35% 28
Transaction Costs 70 20% 14
Marketing Expenses 30 15% 4.5
Overhead Expenses 60 30% 18
Cost Advantage Total 64.5 x Relative Importance of Cost Advantage 35% 22.58
Marketing Advantage
Market Share 80 35% 28
Brand Awareness 100 25% 25
Distribution 70 20% 14
Sales Coverage 60 20% 12
Marketing Advantage Total 79 x Relative Importance of Marketing Advantage 35% 27.65
Competitive Advantage Index 28.05 + 22.58 + 27.65 = 78.28
2. Competitive Advantage
Blue Bell carries an overall competitive advantage index score of 78.28 (out of
100). The difference advantage Blue Bell has is the way they have been is by being
able to keep amazing quality about their products over the years. Blue Bell retains
control over all aspects of its business, primarily to ensure quality control and the use of
the freshest ingredients available. The company uses milk from approximately 60,000
cows each day, and the cream used during each day's production run is always less
than 24 hours old. The reason why Blue Bell is one of the top vendors of ice cream in
America is, because their ice cream has such great quality. The company has a
favorable cost advantage due to them owning their own trucks, which is a huge supply
chain advantage by not outsourcing. Also Blue bell does not market much so there is a
huge budget for doing so. Blue Bell has about 668 distribution routes with convoy and
Copyright 2016 Team 07 Spring 2016. All Rights Reserved.
30
equipment contains a combination of 1,534 trucks and different equipment. (Blue Bell,
2016) You can see that Blue Bell is capable of boosting their sales when needed. All
they would have to do is release a new flavor in to the market. When it comes to the
Marketing Advantage this is huge, because it is important to be able to keep things new,
and to always have new products produced. Blue Bell also does a great job of making
the decision of marketing certain flavors seasonally, or during certain periods of time.
The development of more distribution centers will allow the company to distribute more
of its ice cream products and increase consumers.
Template of Strategic Market Plan Matrix:
3. Strategic Market Plan Matrix
Market Attractiveness Index: 75.16
Competitive Advantage Index: 78.28
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B. Strategic Market Plan
After verifying data obtained from the Market Attractiveness and Competitive
Advantage Indexes, it was determined that Blue Bell can be identified in the “Improve
Position” category and will implement an offensive strategy”.
Blue Bell ranks as one of the top three, best-selling ice creams nationwide and
has major advantages when it comes to competition despite the company's products
being available in about 26% of US supermarkets. Even though the company keeps a
roster of creative flavor combinations, its Homemade Vanilla is its top selling flavor. In
order for Blue Bell to be able to produce sales growth and future profit performance,
their main goal will be to construct more distribution centers that will be strategically
situated near several retailers' distribution centers. The development will allow them to
support deliveries directly to foodservice operators and grocers in many areas.
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Competitive Advantage
0 20 40 60 80 100
New Market EntryImprove Position
Invest to GrowImprove PositionProtect Position
Invest to GrowProtect Position
Improve PositionOptimize Position
Harvest
Improve PositionOptimize Position
Invest to GrowProtect Position
Optimize Position
Harvest or Divest Monetize, Harvest, or Divest
Monetize, Harvest, or Divest
100
80
60
40
20
0
Marketing Attractiveness
32
By developing more distribution centers, Blue Bell Creameries will be able to take
the lead in the ice cream market, beating out competitors such as Dreyer's Grand Ice
Cream Holdings, Inc. and Wells Enterprises, Inc. Blue Bell is a creamery company and
by placing more distribution centers not only will it be beneficial for them but allow them
to grow their market size.
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DEFENSIVE
STRATEGIC FOCUSManage profits & invest to
protect position
STRATEGIC FOCUSInvest for growth & position
Emerging Early Growth Rapid Growth Late Growth Maturing Market Mature Market Declining Market
DEFENSIVE
DEFENSIVEOFFENSIVEDEFENSIVE
OFFENSIVE
OFFENSIVE
OFFENSIVE
MARKET DEM
PRODUCT LIFE-CYCLE STAGES
33
C. BUSINESS PERFORMANCE (STRATEGIC) OBJECTIVES
Blue Bell will take a better marketing approach by implementing advertising into their
business plan. The company currently relies on the same ad campaign, produced by
the same person for more than 33 years, by word of mouth, and through their own
website. Advertising will allow interested ice cream consumers to be directed towards
Blue Bell through brand recognition. Blue Bell’s main focus will be to get more
consumers interested, and help get their ice cream products publicized through social
media, website improvements, billboards, and commercials.
Table of Share Position
Strategic Market Plan
Base Year Year 1 Year 2 Year 3
Market Growth Rate (%)
.25 .30 .31 .33
Market Demand (Billion)
5,030 5,030 5,030 5,030
Market Share (%) 11.30 13 15 17
*Base Year reflects total sales during the year 2015 (Blue Bell)
Blue Bell will obtain a 17% market share in year 3 and market demand will stay the same since it’s a mature market.
Copyright 2016 Team 07 Spring 2016. All Rights Reserved.
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IV. Marketing Objectives
A. Product (Line) Profile
Blue Bell produces over 250 different frozen products. Of these, 66 are flavors of
ice cream. Blue Bell offers around 20 ice cream flavors year-round and about 35
rotating flavors, while an additional two to three dozen are offered seasonally. While
Blue Bell is considered to be a regional brand (with distribution in certain regions of only
23 US states), it is one of the nation's most popular ice cream brands. In addition to ice
cream, it makes yogurt, frozen treats (ice cream sandwiches, fruit pops), sherbet, and
low-fat and sugar-free ice creams (Vault, 2016).
Blue Bell introduced its flagship flavor, Homemade Vanilla, in 1969 and was the
first company to mass-produce the flavor Cookies’n Cream. As of 1997, Blue Bell
Homemade Vanilla was the best-selling single flavor of ice cream in the United State,
and in 2001, Forbes named Blue Bell the best ice cream in the country. In 2011, Blue
Bell introduced a new flavor exclusive to Colorado, Rocky Mountain Road, made with
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more premium ingredients (including chocolate-covered nuts and a marshmallow swirl)
compared to its year-round Rocky Road).
In addition, Blue Bell current line-up includes our popular, fan favorite flavors
such as Black Walnut, Butter Crunch, Buttered Pecan, Cherry Vanilla, Chocolate Chip,
Cookie Dough, Coffee, Cookies’n Cream, Dutch Chocolate, Homemade Vanilla, Milk
Chocolate, Mint, Chocolate Chip, Natural Vanilla Beam, Peppermint, Pistachio Almond,
Rocky Road, and The Great Divided. (Blue Bell, 2016)
B. Target Market
With the average prices $2.45 (at Walmart), adults with children of various ages
have high indexes and are more likely to eat Blue Bell Ice Cream. Homemakers, or
possibly stay-at-home moms, are 29% more likely to eat Blue Bell Ice Cream, and
adults who are married are 11% more likely to eat Blue Bell. Adults with 5 or more
people in the household are 15% more likely to eat Blue Bell. We can assume that
people of these demographics are part of large families and are our target audience.
Our target is 2% more likely to frequently eat sweets and 4% more likely to say that
there is nothing wrong with indulging in fattening foods. They are 5% more likely to be
swayed by coupons and 4% more likely to pay attention to commercials. They are 5%
more likely to remember advertised products when shopping. Adults with children are
31% more likely to use advertisements to help them choose products to buy for their
children. (Hoover, 2016)
C. Positioning Strategy Statement & Value Proposition
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i. Positioning Strategy
Blue Bell is affordable and low-fat and sugar-free ice creams, which is available
in 23 states. While some competitors have slimmed down the size of their ice cream
containers to maintain profit margins, Blue Bell asserts that its ice cream will retain a
half-gallon size. Therefore, Blue bell tries to keep customers coming back for favorite
flavors while trying new ones each year.
ii. Value Proposition
Target Segment: Blue Bell’s target segments extend to the consumer from all
age, included adults, children and families, consumers, and supermarket.
Benefits: Consumers will see that Blue Bell ice cream is often lower in both fat
and calories because it doesn't contain all the candy and sauces, and you are better
able to control how much is placed in your bowl.
Price Range: A half-gallon of Blue Bell, whose retail price ranges from $4.99 tp
$5.99, weighs 52 ounces, compared to 40 ounces for Breyers, and it has a butterfat
content of 13 percent, compared to 18 percent for Haagen-Dazs.
D. Goals and Objectives (Sales Volume, Market Share, Net Marketing
Contribution, Profit, etc.)
i. Sales Volume
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By implementing multiple new advertising platforms, we plan to further reach our
target audience and increase sales among homemakers and adults with families by up
to 33%, and encourage them to make the choose Blue Bell instead of other ice-cream
brand.
ii. Market Share
The company is among the top sellers of ice cream nationwide, with 2003 sales
of $400 million, while its products are distributed only in 15 states. Blue Bell will
increase its market share from a little over 11% in 2015 to 17% in year 3. And our goal
is to dominate our target market in the South to ultimately increase our market share by
17% and become the number one ice cream brand in the United States.
iii. Net Marketing Contribution
i. Marketing ROS (%)
= Net marketing contribution/sales x 100%
Year Net Marketing Contribution (NMC) / Sales x 100% MARKETING ROS
Year 1 $187,015,400.04 / $653,900,000.13 x 100% 28.6%
Year 2 $215,787,000.00 / $754,500,000.00 x 100% 28.6%
Year 3 $244,558,600.00 / $855,100,000.00 x 100% 28.6%
ii. Marketing ROI (%)
= Net marketing contribution/Marketing and sales expenses x 100%
Year Net marketing contribution/Marketing and sales expenses x 100%
MARKETING ROI
Year 1 $187,015,400.04 / $13,078,000.00 x 100% 14.3%
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Year 2 $215,787,000.00 / $15,090,000.00 x 100% 14.3%
Year 3 $244,558,600.00 / $17,102,000.00 x 100% 14.3%
IV. Advertising/Promotion
Blue Bell currently has a Facebook page but has yet to present itself on any
other social networking sites. We want to revamp the Facebook page and create two
additional accounts for both Instagram and Twitter, while still honoring the brands
traditional and southern style. We budgeted for sponsored advertisements to appear on
our three different social media platforms. The ads will be simple and traditional to
appeal to our current customers, and feature new and interactive promotional methods
to grab new ones. The paid-for advertisements will be well coordinated using different
promotional methods that are intended to reinforce each other. Our debut on social
media is the perfect way to reach out to new customers and further illustrate a positive
image for the brand.
Other promotional efforts done include the posting of professional looking
photographs, reposting of photographs uploaded by users and fans, open ended posts
allowing for user feedback and conversation, and surprise coupons meant to excite and
reward loyal customers and our social media followers and fans. Our first coupon to
launch will be the "buy one half-gallon, receive one half-gallon free!" scheduled to
release at the beginning of December in honor of upcoming holidays. Coupons and
other rewards programs will come out four to five times a year.
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V. Marketing Mix Strategy
A. Marketing Strategy Alternatives
Although our company Blue Bell creamery ranks in the top three ice cream
making company in the nation, even though the company products are only distributed
in about 26% of U.S stores. Vanilla flavor is our company top selling flavor even though
there are other roster of creative flavor combination. However due to our competitors
like “Dreyer’s Grand Ice Cream Holdings, Inc., Unilever, and Wells Enterprises, Inc.”
(Hoover, 2016) producing varieties of flavor will acquire more customer, so we decided
to create an online and in store ice cream surveys for customers to let us know which
flavor they will want us to add to our ice cream menu. In addition, since our company is
considered to be “a regional brand because its only distributed within certain region of
only 23 states in the United States” (Hoover, 2016), we plan to expand our company by
using the marketing to “Business to Consumer” strategy in order to increase our
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40
customers, improve our operating efficiency and most importantly improve our customer
satisfaction.
B. Marketing Strategy and Position
1. Product Strategy
We will apply product products variation to differentiate it itself apart from the
competitions. While our competitors slimmed down the size of their ice cream
containers in order to maintain profit margin we will retain the half-gallon size. And to
keep its customers coming back for favorite flavors while trying new ones each year, the
creamery boasts an active product development group that churns out new flavors,
such as its Rocky Mountain Road. (Hoover,2016) The goal of this plan is to set clear
objectives that can be achieved within a year. Increasing market share, sales, social
media presence and brand awareness are necessary steps to follow.
The company has two selected product line that consists of Frozen Yogurt which
flavors are: banana split, cherry granola crunch, country vanilla and strawberry and Ice
Cream which flavors are year round and rotational flavors but mostly known for its
vanilla flavor. Blue Bell will add more flavor to its ice cream, so that there will be variety
of savor to taste from. The more flavor an ice cream company has, the more customers
it will retain and also the more the money will be made, since Blue Bell has only been
known for just two ice cream flavor, initiating and producing more flavors will help the
company grow. While some competitors have slimmed down the size of their ice cream
containers to maintain profit margins, Blue Bell asserts that its ice cream will retain its
true half-gallon size.
2. Pricing Strategy
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Blue Bell is a family owned company, so the satisfaction of our customer is our
number one priority, and because our company has been known for providing quality
products, we will implement “market based pricing” through great value price to stay
ahead of our competitors.
3. Promotion Strategy
With Blue Bell only available within 23 states in the nation, the company will not be
well recognized like that, so in order for our company to be well recognized, we will
invest in marketing strategies and we will advertise through social media. Some
examples will be Facebook, Instagram, Twitter and Snapchat. Also we want to create
an advertising camping on television, newspapers and billboards, Blue Bell can
4. Distribution Strategy
Since our company only distribute in certain regions of only 23 states in the United
State, we plan to expand our company by opening more stores in the nation and also by
distributing our product to different retail stores in order to increase our customers,
improve our operating efficiency and most importantly improve our customer
satisfaction.
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VI. Tactical Action PlansTactical
PlanStrategy Action Item Responsibility Measure Time
FrameProduct
Action PlanProduct
DifferentiationEvaluate
competitor’s flavors and size
of their ice cream
containers
Market analyst Top 5 Competitors
Continuous
Price ActionPlan
Perceived ValuePricing
Implement market based
pricing
Price analyst Top 5 Competitors
Quarterly
PromotionAction Plan
Pull Communications
Advertise through social
media
Marketing Communications
& Retail advertisers
50 Customers
Monthly
DistributionAction Plan
Direct Channel System
Improve operating efficiency
Business Operations Manager
Quarterly Financial Reports
Quarterly
Service ActionPlan
Customer Satisfaction
Satisfy customers
expectations by adding new ice cream flavors.
Customer Service
department
All customers
Continuous
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VII. Implementation, Evaluation and Control
Implementation and Schedules
Blue Bell will continue to focus in the plan of creating new and better flavors for
the consumers, and keeping the production of current flavors in the market for the
incoming years. An amount of the new flavors are expected to come out to the market
on late 2016, and the three-year plan mentioned before will stay ongoing. In the
meantime, the marketing and sales division will continue to develop new and better
ways to maintain and raise the popularity of the brand to the general public in order to
attract new consumers.
The marketing and sales division will also continue to work in the new selling and
advertising strategies for Blue Bell Creameries. In addition, the marketing plan for the
new flavors will continue its development. Along with this, the search of new methods of
advertising and, new media through which the brand can grow will also continue.
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Evaluation, Control, and Monitoring Plan
Blue Bell will continue to maintain its superiority over other brands through new
methods of advertising, and the increase in sales through the development of new
flavors, and a possible new plant in order to satisfy the amount of current and new
consumers. Even if the sales increase at a slow pace in comparison to other brands,
Blue Bell has already developed strategies to eliminate the possibility of low sales
numbers, in order to increase the prosperity of the brand.
As mentioned before, brand awareness is one of the important points in the
three-year plan, and is extensively covered, along with the introduction of the new
flavors during the same span of years. Blue Bell will focus most of the marketing
resources in developing new ways to advertise the brand, mostly through the internet.
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VIII. Financial Projections (Expected Payoff) and Budget
Financial Projections
Firstly, the market for ice cream consumption is in a mature stage. It is not
growing; therefore, we hold market demand at a constant $5.03 billion dollars. We also
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assume that there are opportunistically 50 different supermarkets, wholesalers,
convenience stores, and the like who are buying Blue Bell products. This would include
places like Wal-Mart, Target, and gas stations. Currently, according to Statista, Blue
Bell owns approximately 11 percent of market share in the ice cream manufacturing
marketplace(Statista, 2016). We encourage Bull Bell Creameries to expand by two 2%
per year, over the next three years, while ramping sales from 11% to 17%. Accordingly,
reference to the Financial Budget and Projections chart to see further detail. Some
highlights include maintaining a 30% profit margin. Also, over the next three years,
idealistically, our profit should increase by $12.9 million dollars. This equates to 35%
jump in three years, an aggressive stance we are confident is capable. We also budget
for increases in the marketing expenditure budget every year to allow for our growth.
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Marketing expenses budget
To expand by 2% market share every year, our sales leaders, teams, and
supporting staff need to be well-compensated and the right people need to be
employed. In order to accommodate a growing marketing and sales department, we
increase our salaries and benefits 60% over three years from $4.8 million to $8 million.
This will cover hiring top talent to sell products and manage the department. As we push
to grow, we will expand our efforts to build online communication systems for customers
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48
and provide technical support expenditure to grow allowing for newer ways to purchase,
perhaps ice cream delivery applications through smart phones. Promotion budgets for
our sales and marketing people will steadily increase, allowing for more visits to trade
shows and allowing for more in store promotions. We will create a marketing blitz and
push forward with heavy investment into advertising, newspapers, radio/television,
direct mail offers, point of purchase coupons, and the like. Other expenses including
phones and travel will stay steady over the next four years.
IX. References
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Blue Bell Creameries, L.P.|Company Profile|Vault.com. (n.d.). Retrieved April 05, 2016,
from http://www.vault.com/company-profiles/food-beverage/blue-bell-
creameries,-lp/company-overview.aspx
Blue Bell Creameries. (2010, June 12). Retrieved April 05, 2016, from
https://tshaonline.org/handbook/online/articles/dibgj
Blue Bell Country. (n.d.). Retrieved April 05, 2016, from
http://cdn.bluebell.com/the_little_creamery/blue_bell_country.html
Blue Bell Creameries, L.P. (n.d.). Retrieved March 6, 2016, from
http://subscriber.hoovers.com/ezproxy.lib.uh.edu/H/Company360
Best, Roger (2009). Marketing Metrics Resources – Glossary. Retrieved from
http://www.marketingmetricssolutions.com/glossary.cfm
FIND/SVP (August 1998). The Market for Ice Cream and Other Frozen Desserts.
Retrieved from
http://academic.marketresearch.com.ezproxy.lib.uh.edu
Copyright 2016 Team 07 Spring 2016. All Rights Reserved.
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Hernandez, R. (2005, February 20). Blue Bell heats up ice cream competition.
Retrieved April 05, 2016, from
http://www.bizjournals.com/phoenix/stories/2005/02/21/story8.html
Reynolds, A. (2014, July 03). Consumer Reports: Best ice creams. Retrieved April 05,
2016, from
http://www.ky3.com/news/local/consumer-reports-best-ice-creams/21048998_26
781900
Statista (April 2015). Market Share of the Leading Ice Cream Brands in the United
States in 2015, based on Sales. Retrieved from
http://www.statista.com/statistics/255060/market-share-of-the-leading-ice-cream-
brands-in-the-united-states/
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