We are proud to present you our final report along with a presentation. Through our efforts, we won the opportunity to work and carry out a strategic project concerning Deotto Espresso System business which is on the verge of signing a contract with a famous Italian company Eraclea, which produces and distributes (directly to final consumers and indirectly to Hotels-Restaurants-Cafes) a wide range of high quality products such as hot/cold chocolate, ice-creams and teas, following the new trends of market consumption, that are flavor and original presentation oriented.
We first began by organizing our team to work and communicate effectively. To launch the project, we assessed the market of professional Ho-Re-Ca and chocolate production and distribution in France. Evaluating the internal and external situation of DES and Eraclea, defining the market, explaining the political, economical and social macro environmental factors, understanding the competition were the first steps of the project. Our interlocutors, Laurence Thébaut, responsible for marketing of DES, and Giorgio Guerra, sales manager, gave us information by providing us data, brochures and confidential corporate documents in order to well understand their needs and expectations from us. So, we met our clients in the headquarters.
The second part of the report is the most important one; it reflects the real need of DES. As Eraclea is going to penetrate the French professional market of Ho-Re-Ca, they contracted with DES to benefit from the national distribution network of the existing and potential clients who buy Lavazza capsules and machines (Remember that DES is the exclusive importer of Lavazza capsules and machines). The big challenge was to develop the Italian brand, build recognition and identity, in the minds of French professionals who are behaving as differently as the Italian ones.
[...] Strengths Opportunities DES Regional network of 350 retailers in Sector of Ho-Re-Ca dynamic, France restoration market often precursor Expertise in OCS since 20 years of new trends Already 5000 restaurants equipped Final consumers willing to pay more with Lavazza coffee machines for quality 10 resellers dedicated to Eraclea in Existing clients for Lavazza could 2008 match with Eraclea attributes Eraclea Italian concept of chocolate” Eraclea : Italian brand, perceived as is growing high quality value brand Eraclea proposes chocolate drinks Innovation product/packaging with thick consistency thus meeting Top of the range positioning the expectation of consumers Marketing dynamic Strong Research & Development Weakness Threats DES Commercial means (no human means) Important capability of investment Logistics policy in R&D and marketing Lack of presence in certain regions Consumer behavior: versatile, in terms of resellers. [...]
[...] Their relative advantages and positioning Polymat is the direct competitor of Eraclea because it engages in almost the same activity. Indeed, it produces the machines and the chocolate. Polymat has a comprehensive and wide range of products. But, Eraclea has also the same strength. So, that doesn't represent a comparative advantage. Polymat has a brand image based on the quality, the pleasure and the traditional aspect. It is between the high and the middle segment. Because, on one hand the brand image is familiar and convivial and on the other hand the brand image is luxurious and refined. [...]
[...] In order to succeed, Eraclea has to focus on its luxurious brand image and develop the traditional Italian image of one of the best chocolate brands in the world. In Italy of the turnover of Eraclea is recognized with the hotels and 90% with the breweries. However, the Italian breweries sell more products than the French breweries because they do not have the same way of life. For example, Eraclea could sell its products to several luxurious breweries like the “Durand Dupont” at Neuilly sur Seine, Gare” in Paris or the also in Paris. [...]
[...] The limits of Eraclea The most important point that can be a limit for Eraclea's development in France is that the name isn't yet well known in the French market. It could slow down its development when it comes to customers (HoReCa) and the way they think. For an independent or a well known company, it's always very difficult to change its suppliers when there are no problems even if the other company has many quality products. The second difficulty will be to provide the full line of products to all the customers. [...]
[...] Concerning the brand image, Eraclea has to be careful of changing the advertizing in France. The Italian brochures expose charming/hot girls, and we think that for the French market it will not be appropriate. For France, we recommend to focus the brand image on an elegant style, and romanticism. For instance, we could use the couple image. We also suggest launching a diet range because it is an important trend of the French market. French people are preoccupied by their health and they give a lot of importance to the diet, bio or fair trade products as they want to stay slim but Eraclea's products are very wealthy in calories. [...]
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