Harvard Case - Ben & Jerry's - Japan
"Ben & Jerry's - Japan" Harvard business case study is written by James M. Hagen. It deals with the challenges in the field of Entrepreneurship. The case study is 17 page(s) long and it was first published on : Apr 13, 2000
At Fern Fort University, we recommend Ben & Jerry?s adopt a hybrid strategy for entering the Japanese market, leveraging both market penetration and product development approaches. This strategy will involve:
- Strategic partnerships with local Japanese companies for distribution and marketing.
- Adapting existing product offerings to cater to Japanese tastes and preferences.
- Developing new, innovative flavors specifically tailored to the Japanese market.
- Embracing a strong commitment to corporate social responsibility to resonate with Japanese consumers.
2. Background
Ben & Jerry?s, a renowned American ice cream brand known for its unique flavors and social activism, seeks to expand its operations into the Japanese market. The company faces challenges in navigating a competitive market with established players and discerning consumers. While Ben & Jerry?s boasts a strong brand image and a loyal customer base in the US, it must adapt its strategy to succeed in Japan.
3. Analysis of the Case Study
Competitive Analysis:
- Porter?s Five Forces: The Japanese ice cream market is highly competitive with strong local brands like Lotte and Morinaga, posing a significant threat. The market also faces low barriers to entry, further intensifying competition.
- SWOT Analysis:
- Strengths: Strong brand image, commitment to social responsibility, innovative flavors, and a dedicated customer base.
- Weaknesses: Lack of familiarity with the Japanese market, limited distribution network, and potential cultural barriers.
- Opportunities: Growing demand for premium ice cream, increasing interest in foreign brands, and a receptive market for social responsibility initiatives.
- Threats: Intense competition from established players, cultural differences in taste preferences, and potential economic fluctuations.
Market Segmentation:
- Target Market: Ben & Jerry?s should focus on young adults and families who appreciate unique flavors and are willing to pay a premium for high-quality ice cream.
- Value Proposition: The company should emphasize its commitment to social responsibility, its unique flavor profiles, and its premium quality as key differentiators.
Business Model Innovation:
- Strategic Alliances: Ben & Jerry?s should forge partnerships with local Japanese companies for distribution, marketing, and product development. This collaboration will provide access to local expertise and a strong distribution network.
- Product Development: Ben & Jerry?s should develop new flavors that cater to Japanese tastes and preferences, while also offering familiar favorites with localized adaptations. This approach will appeal to both existing and new customers.
Corporate Social Responsibility:
- Environmental Sustainability: Ben & Jerry?s should highlight its commitment to sustainable practices, such as using local ingredients and reducing its environmental footprint.
- Social Justice: The company should engage in social justice initiatives that resonate with Japanese consumers, such as supporting local charities or promoting fair trade practices.
4. Recommendations
- Strategic Partnerships: Ben & Jerry?s should partner with a reputable Japanese distributor or retailer with a strong network and understanding of the local market. This partnership will facilitate efficient distribution and marketing efforts.
- Product Adaptation: The company should adapt existing flavors to Japanese preferences, such as incorporating local ingredients or reducing sweetness levels. Additionally, Ben & Jerry?s should develop new flavors specifically tailored to Japanese tastes, incorporating traditional Japanese ingredients and flavors.
- Marketing Strategy: Ben & Jerry?s should leverage social media and digital platforms to reach its target audience. The company should also engage in public relations activities to highlight its commitment to social responsibility and its unique brand identity.
- Corporate Social Responsibility: Ben & Jerry?s should actively engage in local social responsibility initiatives, such as supporting environmental sustainability projects or partnering with local charities. This approach will resonate with Japanese consumers who value ethical brands.
- Pricing Strategy: Ben & Jerry?s should adopt a premium pricing strategy, reflecting the high quality and unique flavors of its products. However, the company should also consider offering smaller sizes or value packs to make its products more accessible to a wider range of consumers.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core Competencies: Ben & Jerry?s core competencies lie in its innovative flavor profiles, commitment to social responsibility, and strong brand image. These strengths are aligned with the company?s mission to create a ?world of peace, love, and ice cream.?
- External Customers and Internal Clients: The recommendations cater to the needs of Japanese consumers, who value quality, innovation, and social responsibility. They also align with the values and aspirations of Ben & Jerry?s internal stakeholders.
- Competitors: The recommendations address the competitive landscape by leveraging strategic partnerships, product differentiation, and a strong focus on corporate social responsibility.
- Attractiveness: The proposed strategy is expected to generate a positive return on investment through increased market share, brand awareness, and customer loyalty.
6. Conclusion
By adopting a hybrid strategy that combines market penetration and product development, leveraging strategic partnerships, and embracing a strong commitment to corporate social responsibility, Ben & Jerry?s can successfully enter the Japanese market and achieve long-term growth.
7. Discussion
Alternatives:
- Full-scale expansion: This approach involves establishing a fully owned subsidiary in Japan, which requires significant investment and expertise in local market dynamics.
- Licensing: This option involves granting a Japanese company the right to manufacture and sell Ben & Jerry?s products, but it may compromise brand control and product quality.
Risks and Key Assumptions:
- Cultural differences: Adapting flavors and marketing messages to Japanese preferences is crucial for success.
- Competition: Intense competition from established players could hinder market penetration.
- Economic fluctuations: Economic downturns could impact consumer spending on premium ice cream.
8. Next Steps
- Market research: Conduct thorough market research to identify specific consumer preferences and competitive landscape.
- Partner selection: Identify and evaluate potential partners for distribution, marketing, and product development.
- Product development: Develop and test new flavors and product adaptations tailored to the Japanese market.
- Marketing campaign: Develop a comprehensive marketing plan that leverages social media, public relations, and local partnerships.
- Implementation: Launch the product in selected regions and monitor performance to refine the strategy.
By following these steps, Ben & Jerry?s can effectively enter the Japanese market and achieve its growth objectives while staying true to its core values and brand identity.
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Case Description
The CEO of Ben & Jerry's Homemade, Inc. needed to give sales and profits a serious boost; despite the company's excellent brand equity, it was losing market share and struggling to make a profit. The company's product was on store shelves in all U.S. states, but efforts to enter foreign markets had only been haphazard with non-U.S. sales accounting for just three per cent of total sales. The CEO needed to focus serious attention on entering the world's second largest ice cream market, Japan. An objective of Ben & Jerry's was to use the excess manufacturing capacity it had in the U.S., and it found that exporting ice cream from Vermont to Japan was feasible from a logistics and cost perspective. The company identified two leading partnering options. One was to give a Japanese convenience store chain exclusive rights to the product for a limited time. The other was to give long-term rights for all sales of the product in Japan to a Japanese-American who would build the brand. For the company to enter Japan in time for the upcoming summer season, it would have to be through one of these two partnering arrangements.
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