Team 2 – Fenway Cohort

Andres GarzaKamanasish KunduXiaochun SongCarla VelaDalibor Vucic

Quadrant

New ProductSame Market

New ProductNew Market

Same ProductNew Market

What is Whole Foods?

Highest Quality of Products

Natural & Organic Products

Transform Grocery Shopping into Interactive Theater

New lifestyle towardshealth and pleasure

1

2

3

4

Why China?

2nd largest economy

47% of urbanization (2.3% growth rate)

Grocery Market US $285b growing 7% annually

Movement towards Health Culture

45% CAGR in organic food segment

China is one of the top five organic producers

Total US$1.1billion organic market

22% gross profit for foreign players

The Pyramid Model of Business Key Success Factors in China¹

¹ Market Research done in Mainland China by National Taiwan Normal University in 2010

Leadership

R&D and Innovation; Strategy

Corporate Culture: HRM and Development: Market Demand

Relations with Government

Business Information

Brand Reputation

Supply Chain

Critical Success Factors

Supermarkets

Organic retailers

Online Shop

Huge Market Share

Low Price

Stable Supply Chain

Low Cost

Fast Delivery

Convenience

Quality&

Loyalty

In-StoreExperience

Competition Analysis

White collar families

40%Families with

young children

10%

Young people

Families with health issues

10%

Government Officials

10%

Others

10%3%Foreigners live

in China

Overseas returns

5%

7%

Business people from Taipei and Hong Kong

5%

Main reasons for buying organic foods:

Issues that less concerned with:

• Certification relating quality• Food safety• Information about nutrition value

• Promotion and advertising of organic food• Whether the organic food was produced in

China• The social status of people purchasing

organic food

Organic Products Consumer

Source: Organic Food Products in China, Market Overview, 2010

Customer Segmentation

Education Level in the city of China

1 Beijing

2 Shanghai

3 Wuhan

Income Level in the city of China

1 Dongguan

2 Shenzhen

3 Shanghai

Based on the Education and Income level, we chose Shanghai as the Wholefoods first location in China

Foreigners Population in China

1 Shanghai

2 Beijing

3 Hong Kong

Embracers Daily organic shoppers that already knows Whole Foods. Hold core value on health, importance of natural/organic.

Pro-Organic White collar income people, frequent organic product customers that doesn’t know Whole Foods.

Marketing StrategyTarget Market

Marketing StrategyMarketing Objectives

Increase level of confidence within Embracers

2

Position Whole Foods as the 1st high-end organic supermarket in China

1

Create brand awareness and educate Pro-Organic

3

Promise

Vision

Message

Personality

Personality

Message

Promise

Vision

Marketing Strategy

Brand Map

Quality and LoyaltyIn store experienceConvenience

Healthy and quality organic food Delivery & Online ShoppingWHOLE indoor experience

Seek out the finest natural and organic foods available and maintain the strictest quality standards in the industry to be positioned as the 1st organic theater in China

Customer who hold core value on health and cares about the importance of natural/organic.

Marketing Research

• Primary Qualitative

• Interview the top 20 organic producers in China

• Interview 20 distributor,

• 200 selected aim customers survey

• Secondary Qualitative

• Competitor analysis

• Customer research from social media (Chinese Micro blog)

Financial Projections

Year 1 Year 2 Year 3 Year 4 Year 5Number of Stores 2 4 6 8 10Revenues 60,000,000 132,000,000 206,400,000 281,280,000 356,256,000 Marketing Investment 1,800,000 3,960,000 6,192,000 8,438,400 10,687,680 EBITDA 7,200,000 15,840,000 24,768,000 33,753,600 42,750,720 Net Income 4,200,000 9,480,000 14,976,000 20,515,200 26,063,040

Year 1 Year 2 Year 3 Year 4 Year 5

1,800,000 3,960,000

6,192,000 8,438,400

10,687,680

4,200,000

9,480,000

14,976,000

20,515,200

26,063,040 Marketing Investment Net Income

Marketing Mix

PRODUCT

PRICE

PLACE

PROMOTION

OFFERING

VALUE

EXPERIENCE

RELATIONSHIP

Quality Standards: Organic Integrity

No price competition: High-end products

Encourages Five Senses: A Experience

Customers are Brand Ambassadors“Good Food Feels Good”

Marketing Strategy

Marketing Communications• Press Release & Brochures• Loyalty Card• WOM through loyal customer• Newsletter (Coupons, Recipes…) • Value Tours

Outbound Marketing

• WOM with Social Media• Hire influencers who have more than 1,000 followers to

post the stories and recommendations of WF• Advertise with online Farmer Game

Inbound Marketing

Sales Enablement

• Train Employees

• How to daily arrange the store

• How not to run out of stock

• How to manage promotional tools

• How to please customers

• How to conduct value tours

• Create self directed Teams

• Team Member incentive programs

• Employee of the week

• Loyalty Programs

• Team Member Stock Options

• Continuous learning and promotion opportunities

Conclusion

AppendixStrength Weakness Opportunities Threats

Traditional Supermarket

•Have lots of loyal customers•Low price•Big market share

•Lack of high quality products

•Different product price•Customer

behavior education

•They are losing their organic customer because of the quality problem in the former experiments

Organic retailer:Lehuo, Haike

•Have lots of loyal customer•Good reputation

•Supply chain in China has not completed• Small scale

•Franchise •Difficult control supplier’s quality•Too small to

expend

Online shop:Tootoofood,Yiguo

•Low cost•Direct delivery

•Only focus on few KPUs•Late delivery•Customer

satisfaction

• Include more KPUs•Warehouse

management

•Relay too much on suppliers•Competition from

big online shopping mall