AVERITH ENTERPRISES

Averith Enterprises is a startup company offering Deliciosa Organic Ice Cream. It

aims to provide customers a delicious, nutritious and affordable ice cream.

MARKETING PLAN

Determining market demand and meeting customers’ needs are two of the
primary objectives of any companies which will form part of the Marketing Plan. Thus,
this chapter covers plans about the product, its price, ways of promoting and methods of
distribution.

1.1 DESCRIPTION OF THE PRODUCT

Product is the tangible output that a company offers to customers. It is the

forefront indicator of a company’s extensive efforts to make it a want-satisfying good.
Customers consider this as the focal point to decide patronage and preferences.

Deliciosa Ice Cream is made from coconut milk, milk solids-non-fat (skim-milk
powder), sugar; all purpose cream, and natural fruits or premium cocoa powder.
Coconut milk is known to be an antioxidant. It can prevent cancer and other digestion-
related diseases. It cures constipation and will make your skin smooth. Moreover, skim
milk is a good source of calcium that increases the solid content of the ice cream and
gives it more body. It is also an important source of protein which will improve the ice
cream because of the nutrients. Fresh fruit is also used as a flavor which is a good
source of vitamins and minerals.

Deliciosa Ice Cream will strive to make an image as a nutritious, delicious and
affordable ice cream. Unlike existing national brands, Deliciosa Ice Cream uses fresh
fruits as the flavoring component that makes it more nutritious with the following health
benefits:

o It lowers cholesterol level.

o It is rich in fiber which could solve your digestion problems.
o It reduces the risk of heart attack.
o It has a higher content of vitamins and minerals considering that it is fresh.

Moreover, it is very delicious. The group conducted free taste among

the students and they commented that it is very delicious. They even
noted that it can rival national brands of ice cream because of its delightful
taste. Furthermore, it is highly affordable relative to competitors.
Consumers can now enjoy eating ice cream at a low price. We
provide this satisfaction to attract more customers and retain the loyal
ones. Hence, our competitive edge delves into offering affordable,
nutritious and delicious ice cream.
1.2 COMPARISON OF THE PRODUCTS WITH ITS COMPETITORS

Product Quality

It has been said that quality is like beauty, in that; it is in the eyes of the
beholder. While there is a standard definition to it because of the efforts done by
companies in their Total Quality Management or TQM, a person’s unique
definition is cathartic. It is evidenced in the initial survey we conducted. We asked
what does quality mean to them and answers varied from the texture to taste and
cheap price to availability. 32% commented that it should be tasty and
delicious. As such, Deliciosa Ice Cream will capitalize in its delicious taste. If
customers will be satisfied with its taste, then repeat purchases is expected.

Price

Price is the amount of a particular good that customers are willing to pay.
It can be the major reason of product purchase. Deliciosa Ice Cream is priced
lower than the “giants” in the ice cream industry and higher than the existing
homemade ice cream in the market. With this, we anticipate more customers will
be patronizing our product because it will be very affordable for the students,
faculty and staff of MSU-Iligan Institute of Technology and the residents in Iligan
City.

The group plans to use a “transparent” packaging inorder to attract more

prospective customers.

1.3 LOCATION

Averith Enterprises will be renting a space located at Clovy Enterprises near

the MSU-IIT Cooperative. The group believes that it is a strategic location because it is
just adjacent to the MSU-IIT campus where the target market is in. Moreover, the place
is just a few steps near to the National Highway, an indication of accessibility for more
customers to pay attention to the business. Acquisition of raw materials will be done
once a month and in bulk. An exception to the fruits which will be bought thrice a month
or as needed to avoid spoilage and to ensure freshness. While the business is yet to be
explored, the proponents will act as employees themselves and they will hire 1 person
responsible for manufacturing and the other one as an attendant in the store when the
owners are not around.
1.3B. STORE LAYOUT

1.4 MARKET AREA

MSU-Iligan Institute of Technology will be the focal coverage of the business.

With over 12,000 constituents, MSU-IIT comprises 2.4% of the total population in Iligan
City. Presently, there are four stores that offer ice cream products near the campus. The
group will be renting a space at Clovy Enterprises and will do direct distribution whereby
customers will be served in the store.

1.5 MAIN CUSTOMERS

The target market of the enterprise will be the students, faculty and staff of MSU-
Iligan Institute of Technology.

The college students comprise the largest population of the institute. Most of
them have Php 3,001 – Php 4,000 monthly allowance, 17-21 years of age and live in
the lodging houses and dormitories near the campus. They buy products for personal
consumption. Based on the survey, 98% of them like to eat ice cream.

The faculty members of the institute have a monthly salary ranging from
Php 10,000 to Php 60,000 and above. Most of them are already married, 25-56 years
old and reside within Iligan City. They basically buy products for their families and based
on the survey, majority of them likes to eat ice cream.

The administrative staff of the academe earns an income ranging from

Php 5,000 to Php 30,000 monthly and up. Majority of them are married, with ages
from 22 to 56 and most stay in their houses or rent an apartment within Iligan City.
Based on the survey, they like to eat ice cream.
1.6 TOTAL DEMAND

In Barangay Tibanga, there are four retail stores that sell ice cream products of
Nestle, Magnolia and Selecta. However, ice cream is not their main offering. AVERITH
Enterprises will be the first of its kind and Deliciosa Organic ice cream will be the
main product. The group hopes to serve 12,198 constituents of MSU-Iligan Institute of
Technology. Specifically, there are

 11,491 registered high school, college and graduate students

 497 faculty members
 210 administrative staff

1.7 MARKET SHARE

Ice Cream # of Their Share Their Product Market Share

Products Competitors Features (%)
Scoop Few Small Similar 20 – 40 %
Cup Few Small Similar 20 – 40 %
Pint Few Small Similar 20 – 40 %
½ gallon Few Small Similar 15 – 30 %
1 gallon Few Large Similar 15 – 30 %

Basically, there are few competitors offering ice cream products near MSU-IIT namely:

 Clovy Enterprises. It is located some meters away from the main entrance of
MSU-IIT. They offer grocery products to customers. Ice cream from Nestle and
Selecta is one of their product offerings. Accordingly, drumstick is the most
saleable item where students enjoy eating it after classes. At least 100 pieces will
be sold in a week.

 Kristine’s Bakeshop. The store is situated alongside with various

establishments in Tibanga. Bread is their main product. They also sell Nestle Ice
Cream. A small area is allocated for customers who would like to eat ice cream
and bread within the store.

 Mr. Bakers. The store offers bread, cake and pastries. They also sell ice
cream products of Nestle. Their competitive advantage is the 24/7 concept
wherein they sell products whole day, seven days a week. Most of their
customers are students who like to take snacks with their friends and
classmates.

 Petron Gas Station. The establishment sells Nestle Ice Cream products. As a
gas station, their customers include vehicle owners, drivers and even passengers
who get to drop by the area.
1.8 SELLING PRICE

Averith Enterprises will establish an Ice Cream Parlor / mini store offering ice
cream in scoop, cup, pint, ½ gallon and 1 gallon. The business will join the “giants” in
the ice cream industry by offering organic ice cream to the students, faculty and staff of
MSU-IIT. As such, the group will use a Comparative Method in determining the selling
price of the Ice Cream. Please refer to table below on the table below.

Averith Clovy Enterprises Kristine’s Mr. Petron Gas Station

Variants Enterprises Bakeshop Bakers

Deliciosa Nestle Selecta Nestle Nestle Nestle Selecta

Scoop Php 10 - - 30 - 35 - - -
Cup Php 20 20 25 20 20 20 25
Pint Php 60 125 140 125 125 125 140
(500ml)
½ gallon Php 199 240 - 250 225 - 275 240 - 250 225 - 275 225 260 - 270
1 gallon Php 389 400 - 450 400 - 420 400 - 450 400 - 420 400 – 420 400 - 420

Averith Enterprises will set the price lower than the competitors. Based on
the survey conducted, respondents prefer ice cream at Php 10.00 per scoop, 20.00 per
cup, 60.00 per pint, 199.00 per ½ gallon and 389.00 per 1 gallon. The group will use
psychological pricing to support the claim that Deliciosa Ice Cream is very
affordable. The price of 1 cup, however is similar to that of Nestle because 87 out of
222 respondents or 39.2% chose the Php 20.00 price for 1 cup. These lower prices
serve as another competitive advantage of Averith Enterprises that will allow anyone
specially the constituents of MSU-IIT to eat ice cream at a very affordable price. Hence,
the group can give customers happiness through eating ice cream which is also
one of their goals.
1.9 SALES FORECAST

STUDENTS
f % Population x Estimated Estimated Frequency
# of of
Percentage customers Purchase

Once a week 33 0.18 x 11491 = 2061 x 10% = 206 x 4 = 824

More than once
a week 32 0.17 x 11491 = 1998 x 10% = 200 x 3x4 = 2398
Once a month 52 0.28 x 11491 = 3247 x 10% = 325 x 1 = 325
2-3 times a
month 50 0.27 x 11491 = 3123 x 10% = 312 x 3 = 937
Occasionally 16 0.09 x 11491 = 999 x 10% = 100 x 1 = 100
Expected # of customers'
183 purchase 4584

FACULTY

Once a week 4 0.11 x 497 = 57 x 10% = 6 x 4 = 24

More than once
a week 5 0.14 x 497 = 71 x 10% = 7 x 3x4 = 85
Once a month 9 0.26 x 497 = 128 x 10% = 13 x 1 = 13
2-3 times a
month 10 0.29 x 497 = 142 x 10% = 14 x 3 = 42
Occasionally 7 0.20 x 497 = 99 x 10% = 10 x 1 = 10
Expected # of customers'
35 purchase 174

STAFF

Once a week 0 0.00 x 210 = 0 x 10% = 0 x 4 = 24

More than once
a week 2 0.04 x 210 = 8 x 10% = 1 x 3x4 = 9
Once a month 28 0.51 x 210 = 107 x 10% = 11 x 1 = 13
2-3 times a
month 13 0.24 x 210 = 50 x 10% = 5 x 3 = 42
Occasionally 12 0.22 x 210 = 46 x 10% = 5 x 1 = 10
Expected # of customers'
55 purchase 98

The group identified the number respondents as to how frequent they are in buying
ice cream. They used the percentage as a basis in determining the sample from the
total population of each segment and approximately 10% of them will do the actual
purchase which is also one of the marketing goals of the business. Finally, the
expected number of customers in each segment is determined by multiplying the
estimated number of customers with the frequency of purchase. The total of which
serves as the benchmark.
Moreover, the group made an assumption that not all of the student population for
instance will only buy ice cream per scoop. Percentage distribution is applied as follows:

Students Faculty Staff

Scoop 60.0% 5.0% 5.0%
Cup 30.0% 10.0% 15.0%
Pint 5.0% 20.0% 20.0%
1/2 gallon 3.0% 25.0% 20.0%
1 gallon 2.0% 40.0% 40.0%

To illustrate, 60% of the expected student customers will buy ice cream per scoop in a
month. The process is similar with faculty and staff in determining the monthly sales per
scoop, cup, pint, half and 1 gallon of ice cream. Please refer to the sales forecast below.

Students Faculty Staff

Expected # of
customers 4,584 174 98
X Price per
Refer to the
percentage
distribution
of patronage
Scoop 10.00 27,504.00 87.00 49.00 above
Cup 20.00 27,504.00 348.00 294.00
Pint 99.00 22,690.80 3,445.20 1,940.40
1/2 gallon 169.00 23,240.88 7,351.50 3,312.40
1 gallon 299.00 27,412.32 20,810.40 11,720.80
Sales per Month 128,352.00 32,042.10 17,316.60 177,710.70
X 10 months 10.00 10.00 10.00 10.00
Total Sales for 10 months 1,283,520.00 320,421.00 173,166.00 1,777,107.00

Sales during
Summer
Expected # of
customers 687.60 26.10 68.60
X Price per
Scoop 10.00 4,125.60 13.05 34.30
Cup 20.00 4,125.60 52.20 205.80
Pint 99.00 3,403.62 516.78 1,358.28
1/2 gallon 169.00 3,486.13 1,102.73 2,318.68
1 gallon 299.00 4,111.85 3,121.56 8,204.56 15,437.97
19,252.80 4,806.32 12,121.62 36,180.74

TOTAL SALES Php 1,813,287.74

The figures above show a sales forecast in a year. The group also estimates that during
summer, only 15% of the student and faculty and 70% of the staff population will be
around at the campus. This is due to the fact that some faculty and students don’t enroll
summer classes while staff members still report on duty during the period.
Hence, the sales forecast for 5 years will be as follows:

Year 1 Year 2 Year 3 Year 4 Year 5

SALES 1,813,287.74 2,175,945.28 4,351,890.56 6,527,835.85 8,703,781.13

The group assumes a 20 % increase in sales on the 2 nd year of its operation. They also
want to increase sales by 200 % on the 3rd year by producing 42 gallons of ice cream a
day considering the increasing demand in the future. This increment will be made
possible by aggressive marketing efforts, additional production staffs and financing.

1.10 Marketing Strategy

A strategy is a broad course of action by which an organization intends to

reach its objectives (Stanton, Fundamentals of Marketing). It describes what should
be done and how to do it to realize the predetermined goals.

Market Penetration Strategy

Market Penetration aims to enter the market at a relatively low price

and hopes to increase sales for present products. As a new entrant to the
MSU-IIT market, Averith Enterprises will offer affordable organic ice
cream. For instance, the price of 1 gallon with durian flavor is Php 299.00
compared to Php 400.00 and up with brands such as Nestle and Selecta.
This is an important strategy to penetrate the market quite easily because
people have this innate desire to try lower-priced products and eventually,
they will be able to appreciate the product because of its excellent taste.

Market Development Strategy

Market Development is a process of identifying a new group of

customers to serve. This is evidenced by the company’s desire to provide
want-satisfying products to a new group of customers. Averith
Enterprises does this by accommodating customers other than the MSU-
IIT constituents. Another set of promotional tools will be employed to
better satisfy this new group of customers. The proponents of the
business venture anticipates this direction by penetrating first the present
target market and expand through catering other new market segment 3
months after the commercialization or launching of the said business.

Product Development Strategy

Product Development incorporates production of new related products.

It could actually be an expansion of product mix or extension of the
product line. Averith Ice Cream will also explore this strategy by
 introducing new flavors of homemade ice cream. Doing this will make
the customers more excited and fortunate because their other preferences
will be offered. This also justifies the notion that every individual has a
distinct need to satisfy, hence the relevance of offering a new flavor or
even size variants as examples.

Diversification

Diversification is the process of venturing into a new undertaking which

maybe related or not to the existing business. This poses a challenge to
the business for deliberation. Avireth Enterprises likes the idea of
offering bread, cakes and pastries after some months of selling organic ice
cream. The proponents believe that these are complementary products for
overall satisfaction. They will consider this as an exciting opportunity with
the hope of gaining profit.

Marketing Tactics

A tactic is a more specific activity that details the marketing strategy. Proper
planning and implementation will make the activities more effective and successful.
It delves on the 4 P’s of marketing namely product, price, promotion and place of
distribution. It requires creativity to become unique and influential among customers.

Price
One of the major reasons why consumers buy products is price. In
fact, others make it the sole basis before buying something. Averith
Enterprises will use market penetration pricing in which price is set
lower than competitors to reach the market quite easily. This will be
another competitive advantage which is favorable to the proponents.
During the blind taste test, respondents were also asked to voice out
their comments about the product and it was so amazing that they like
the taste very much. They even stressed that the product can be highly
saleable because of great taste. In relation to price, the proponents are
confident for the success of this technique to earn bigger sales.

Cost-plus pricing will also be incorporated in which a mark-up is

added to the total cost to earn profit. Also, psychological pricing will be
employed in which price will be set at seemingly odd prices like Php 299
instead of Php 300 for 1 gallon of ice cream. This will further attract more
customers to buy.

Promotion
Promotion is the element in the marketing program that serves to
inform, persuade, and remind the market of the company and/or its
products (Stanton, Fundamentals of Marketing). It is the communication
tool to convince more customers. In fact, it is called as marketing
communication because every single element of the marketing mix should
be communicated to the target audience. Averith Ice Cream will be doing
a lot of promotional activities including:

a. Word of mouth Communication

Averith Enterprises will facilitate word of mouth communication by

ensuring customers are satisfied because they will serve as
promotional channel in which they will tell their friends, relatives and
loved ones about the product. This exposure is very much influential
because of the third party impact in promoting the product.

b. Advertising

Avireth Enterprises will make use of the following as advertising

tools:

o Tarpaulin
o Leaflets
o Calling Card
o Trivia. The proponents will be posting Trivia about Ice Cream on
the bulletin boards every other day with contact details of our
business. This is to facilitate accidental exposure to information
among passersby or bystanders near the information bulletins.

c. Sales Promotion
The proponents will be using sales promotional techniques to
increase sales. Below is a list of methods:

o Free taste. Allowing customers to at least try the product opens

a doorway for more sales. Implementing this will make
prospects to buy the product. The proponents are confident with
its delightful taste, hence the relevance of this technique.

o Discount. We will give concessions to birthday celebrants such

as 5% discounts for 1 gallon and 15% for 1 tube of ice cream
purchased.

o Point of Sale Promotion

 d. Public Relations

The group will sponsor events such as simultaneous eating of ice

cream in cone by hundreds of college students in the campus. This will
be realized a year after the grand launching of the business on March
2016.

We will also coordinate with organizations that will be organizing

medical mission and extend financial assistance. Sometime later, the
proponents will really spearhead free dental and health check up here
in Iligan City and some other places. Doing all these will eventually
result to positive publicity and will create a positive impact

e. Internet Marketing
With an outgrowing number of users in facebook and other
networking sites, promoting our product through it is a good idea. We
will create a group page in facebook with members exclusive for the
constituents of Iligan City. This is to elicit orders during important
occasions such birthdays and family reunions. The group plans to
maximize its advantages three months after the opening of the
business.
We will also invite bloggers and social media influencers to try our
product for free and they will serve as brand ambassadors.

Place of Distribution

Place of Distribution is the location or the channels of distribution that a

company selects in serving the target market. It is another crucial element
because it is the end point of making a sale. The proponents will make
use of direct distribution strategy in reaching the target market. They
will rent a space at Clovy Enterprises to serve the customers. They will
also accept orders and deliver it to the customers with a service charge.

The group also plans to put up ice cream stalls near MSU-IIT and
Gaisano Mall to serve a broader target market.
1.11 MARKETING BUDGET

Schedule of Promotional Expenses

Feb - Mar Apr - May Jun - Jul Aug - Sep Total

Tarpaulin 2,500.00 2,500.00 1,000.00 1,000.00 7,000.00

Leaflets 500.00 - - - 500.00
Calling card 300.00 - - - 300.00
Free Taste 500.00 500.00 500.00 - 1,500.00
Communication (e.g. Phone calls) 1,000.00 1,000.00 1,000.00 1,000.00 4,000.00
Transportation Allowance 1,000.00 1,000.00 1,000.00 1,000.00 4,000.00
Birthday celebrants 600.00 600.00 600.00 600.00 2,400.00
Public relations 500.00 500.00 500.00 500.00 2,000.00

Total Promotional Expenses 6,900.00 6,100.00 4,600.00 4,100.00 21,700.00