ContentsProduct Statement......................................................................................................................................4

Analysis of the External Environment..........................................................................................................5

Industry Trends........................................................................................................................................5

Competitive Trends.................................................................................................................................7

Brand Competitors..............................................................................................................................7

Product Competitors...........................................................................................................................7

Generic Competitors..........................................................................................................................10

Total Budget Competitors..................................................................................................................10

Political Trends, Legal Trends and Regulatory Trends...........................................................................11

Franchising.........................................................................................................................................11

Food and Drug Administration..........................................................................................................11

Technological Trends.............................................................................................................................13

Economic Trends...................................................................................................................................14

Cultural Trends......................................................................................................................................17

Analysis of the Customer Environment.....................................................................................................19

Who.......................................................................................................................................................19

How many.............................................................................................................................................20

What......................................................................................................................................................21

Why and How........................................................................................................................................23

When.....................................................................................................................................................24

Why Non Customers..............................................................................................................................25

Where....................................................................................................................................................26

Analysis of the Internal Environment........................................................................................................27

Marketing strategies..............................................................................................................................27

Target Market....................................................................................................................................27

Image.....................................................................................................................................................27

Marketing Programs..............................................................................................................................28

Advertising.........................................................................................................................................28

Product and Service Offering.............................................................................................................29

Distribution and Channel Programs...................................................................................................30

Pricing................................................................................................................................................30

1

Sales strategy and Sales force effectiveness......................................................................................30

Marketing research /intelligence gathering efforts...........................................................................30

Public relations/publicity...................................................................................................................31

Financial Performance...........................................................................................................................32

Additional Company Characteristics......................................................................................................33

Technical Capabilities........................................................................................................................33

Available Resources...........................................................................................................................33

Production Capacity...........................................................................................................................33

Career Opportunities.........................................................................................................................34

SWOT Analysis...........................................................................................................................................35

Strengths...............................................................................................................................................35

Weaknesses..........................................................................................................................................37

Opportunities........................................................................................................................................38

Threats...................................................................................................................................................39

Marketing Goals and Objectives................................................................................................................40

Goals......................................................................................................................................................40

Objectives..............................................................................................................................................40

Marketing Strategies.................................................................................................................................41

Target market........................................................................................................................................41

Value Proposition..................................................................................................................................42

Positioning Statement...........................................................................................................................42

Issues Analysis.......................................................................................................................................43

Action Plans...............................................................................................................................................45

Valpak Savings Coupons........................................................................................................................45

Free Smoothie Sample at Gasparilla Distance Classic Race Expo...........................................................46

Customer Loyalty Card..........................................................................................................................47

University of South Florida Freshman Orientation Promotion..............................................................48

Tuesday Free Kids Giveaway..................................................................................................................49

Dog Yappy Hour.....................................................................................................................................50

Student Study Break promotion............................................................................................................51

Clear Channel Outdoor Digital Billboard................................................................................................52

2

Senior Citizen Afternoon Happy Hour....................................................................................................53

Monthly Customer Drawing..................................................................................................................54

Marketing Budget......................................................................................................................................55

What We Learned......................................................................................................................................56

3

Product StatementAward-winning Cold Stone Creamery has been serving up superior ice cream, cakes, cup cakes and

smoothies and shakes for over 20 years. In 1988, founders Donald and Susan Sutherland pursued their

“ice cream dream” when they opened the first Cold Stone Creamery in Tempe, Arizona. Since they were

ice cream lovers themselves, their mission was to give customers the “to make people happy and give

them the ultimate ice cream experience”.1 There are more than 1,450 Cold Stone creamery franchises

located throughout the United States and in countries all over the world. Currently, there are 15

locations throughout Hillsborough County. The company is based in Scottsdale, AZ and is owned and

operated by Kahala Franchising, L.L.C.

Industry experts have referred to Cold Stone ice cream as “super premium” because it is made fresh

every day in each store. All ice cream orders are called “creations,” because the ice cream artists use a

frozen granite stone to mix anything and everything into any ice cream flavor. There are over 11 million

possible creations and after years of practice, some of the favorites have been named “Cold Stone

Signature Creations”.2 For ice cream lovers who want to indulge in flavors and not the calories, Cold

Stone has several options they call, “Healthy Indulgences”. These health conscious customers can

choose from non-fat no sugar added ice cream, Sorbet flavors and non-dairy smoothies.

The ice cream creations are offered in three sizes: 5 oz, 8 oz, and 12 oz. The sizes are creatively named

“Like It”, “Love It”, and “Gotta Have It” respectively. There is also a 3 oz kids’ size available for young

Cold Stone lovers. Customers that really “Gotta Have it” can order larger quantities “to go” in either

“mine”, “ours” and “Everybody’s” sizes (small, medium and large). Cold Stone treat prices are $3.29 for

a “Like it,” $3.39 for a “Love it,” $3.79 for a “Gotta have it,” and $1.69 for a kids size. “To go” prices

range from $6.99 to $9.99 and toppings start at 30 cents each.

1 “Our Story” Coldstone Creamery. September 6, 2010 https://www.coldstonecreamery.com/about/cold_stone_story.html2 “Our Story” Coldstone Creamery. September 6, 2010 https://www.coldstonecreamery.com/about/cold_stone_story.html

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Analysis of the External EnvironmentIndustry Trends

The United States Frozen dessert market has two main channels: retail and foodservice. The retail

market encompasses sales of frozen goods through grocery, convenience, specialty and discount stores

while the foodservice market includes sales from scoop shops, restaurants, vending machines and other

establishments. In 2009, it was estimated that the U.S. ice cream and related frozen dessert market

reached 24.6 billion dollars, a 1.5% increase from 2006. In the same time period, nearly 60% of all U.S.

frozen dessert sales were made through foodservice.3

The foodservice market has been faced with tough times because of the ongoing recession. Consumers

are eating at home more, and are buying ice cream from retailers to eat at home instead of going out.

The ice cream sales have not grown since 2006 and experienced a 3.6 percent decrease from 2007 –

2008. It is forecasted that foodservice ice cream sales will continue to decline, up to 4 percent, through

2013.4 Although this seems like bad news, these shops have a unique advantage. Going out for a bowl

of ice cream allows consumers to indulge in a small luxury, but be mindful of their wallet during difficult

economic times. Super premium ice cream shops, are a bit more expensive, but aim to give consumers

the most bang for their buck. When they visit these upscale shops, they are looking for more than a

bowl of ice cream; they are looking to have an “experience”. This trend is called “The Starbucks effect,”

and causes consumers to pay more to get a personalized experience.5

Being health conscious continues to be a trend with consumers and has lead to the comeback of frozen

yogurt shops. From 2005 to 2009, foodservice frozen yogurt sales grew 10.9 percent while during the

same time period foodservice ice cream sales experienced only a 4% growth because of declines in 2007

and 2008.6 Consumers want still want to treat themselves to something sweet, but without the extra

calories. The new frozen yogurt shop is self-serve, where customers dispense and mix their own flavors,

pick out toppings and pay by weight. Self-serve shops allow consumers to still have a personalized

experience without having to pay a premium price. In the Tampa Bay area, Yogurtology and Yogurt Spot

are two self-serve yogurt places have recently been popping up.

3 “Ice Cream and Frozen Desserts in the U.S.: Markets and Opportunities in Retail and Foodservice, 6th Edition” MarketResearch.com September 8, 20104 “Market Size and Forecast” Ice Cream shops US 2009 Mintel report September 8, 20105 “New Product Trends” Ice Cream and Frozen Desserts. Marketresearch.com 20106 “Foodservice Frozen Yogurt Is a Soft-Serve Market” Ice Cream and Frozen Desserts. P.71. Marketresearch.com 2010

5

Health conscious consumers are demanding great tasting natural food with simple ingredients. In

response to this trend, Haagen-Dazs came out with their “Five” series of ice cream. Each flavor of

Haagen-Dazs Five has only five natural ingredients: milk, cream, sugar, eggs and one additional flavor

ingredient. All of the ingredients are easily recognized by consumers and make them feel good about

what they are putting into their bodies.7

The demand for organic products is no longer something found only in urban areas and in college towns.

In 1997 organic products was a 3.6 billion dollar industry and in 2007 it was recorded to have grown to

18.9 billion dollars, making organic products mainstream. Many mainstream ice cream manufactures,

such as Ben & Jerry’s, have reacted to this demand and now offer an organic version of their products.8

Co-branding is a relatively new trend where two different franchises, usually from the same parent

company, provide offerings from one location. Over 10 years ago, Dunkin Donuts and Baskin Robbins

were two of the first franchises to successful open a co-branded shop. Recently, many other franchises

have followed suit, including Maggie Moo’s and Great American Cookies; Pizza Hut and Taco Bell; and

Marble Slab Creamery and a NexCen preztelmaker subsidiary. Co-branding is a way that both brands

can take advantage of their complimentary traffic patterns, raise awareness, grow, and keep costs

down.9

7 “Haggen-Dasz Five Stands Out” Ice Cream and Frozen Desserts. P. 293 Marketresearch.com 2010 September 8, 20108 USDA says Organic is Mainstream” Ice Cream and Frozen Desserts. P. 66 Marketresearch.com 2010 September 8, 20109 “The Major Ice Cream Chains” Ice Cream and Frozen Desserts. P. 157. Marketresearch.com 2010 September 8, 2010

6

Competitive TrendsBrand Competitors

Marble Slab Creamery claims that in 1986 it was the first shop to use a frozen granite slab to blend

mix-in toppings into the ice cream, per the direction of a customer. The company began in the

Southeastern region of the United States and has since expanded to nearly 400 locations in 35 states,

Canada, the United Arab Emirates, Kuwait, and Mexico.10 There are five locations within the Tampa Bay

Metropolitan Area.11 Marble Slab Creamery had $89 million in sales in

2008, making up 6.9 percent of the leading ice cream shop market.12

In September 2009, Marble Slab announced a line of shakes for

"grown-up" tastes. The new shakes, under the Club Marble label,

include Irish Cream, espresso, and island coffee flavors. In an effort to

become more environmentally friendly, the company launched a

program in the spring of 2010 to phase out plastic containers and

replace them with paper products. Its packaging displays the phrase,

“Find Happiness Within,” a sentiment that embodies the culture of the brand. 13 The company has

defined its brand through a gourmet proposition maintained by a “chef-driven vision.” This concept is

being promoted as part of the company’s rebranding initiative. In an effort to reposition its global brand

image to better reflect its gourmet ice cream artistry experience, Marble Slab Creamery collaborated

with contestants from the television show Top Chef to create, “Celebrity Sundaes.”14

Product CompetitorsDairy Queen combines ice cream and fast food under one roof. This is an effort to produce leverage

over its competition, by creating a restaurant-like atmosphere to attract families. Dairy Queen,

headquartered in Minneapolis Minnesota, has 5,600 stores in the U.S., Canada, and many other various

10 Ice Cream and Frozen Desserts in the U.S.: Markets and Opportunities…6th Edition, pg.16711 www.yellowpages.com (September 14, 2010)

12 Ice Cream Shop – US – December 2009, Mintel Oxygen, Leading Companies13 Ice Cream and Frozen Desserts in the U.S.: Markets and Opportunities…6th Edition, pg.16814Ice Cream Shop – US – December 2009, Mintel Oxygen, Brand Qualities

7

countries.15 There are 21 locations in the Tampa Bay Metropolitan Area.16In 2008, Dairy Queen had

$2,550 million in sales, making up 50.5 percent of the top U.S. ice cream shop chain market.17 In 2009,

Dairy Queen announced “The Sweet Deals value menu” which includes nine items that can be purchased

in combinations of two for $3, three for $4 or four for $5. Items include

a cheeseburger, all-beef hot dog, chicken wrap, French fries, onion

rings, salad, beverage and sundae or cone.18 Dairy Queen is aggressively

seeking innovative ways to engage consumers and build brand equity

through social media, mobile messaging and virtual branding. Dairy

Queen spent 78.1 million in advertising expenses in 2008, an 86.3

percent share of the top ice cream shop advertisers.19 Dairy Queen is best known for its signature

Blizzard treats, and they account for about a quarter of its total sales. The company puts a huge

emphasis on its promotional support because of how much sales come from this trademark product.

The company created a “Blizzard of the Month campaign”, which is advertised on television to create

product awareness and excitement.

Baskin-Robbins is the largest frozen dessert chain in the United States and the world, with more than

2,800 locations in the U.S. and 6000 throughout the world and 2,800 locations in the United States.

There are 25 locations in the Tampa Bay Metropolitan Area.20 Baskin-

Robbins had $572 million in sales in 2008, making up 11.3 percent of

the top U.S. ice cream shop chain market.21 Baskin-Robbins is a leading

player in the ice cream industry and embodies the brand qualities of a

traditional ice cream shop. The company has classic menu offerings and

offers consumers a variety of flavors. Baskin-Robbins plans to reinvent

the brand by offering Soft Serve ice cream and create a new value price

point. In addition, Baskin-Robbins is beginning a new concept format

called “BR Express” featuring a product line based from the future soft serve menu. 22 In 2009 Baskin-

Robbins suffered and was faced with challenges from the recession. In response, it released a new

15 Ice Cream and Frozen Desserts in the U.S.: Markets and Opportunities…6th Edition, pg.16316 www.yellowpages.com (September 14, 2010)17 Ice Cream Shop – US – December 2009, Mintel Oxygen, Leading Companies18 Ice Cream Shop – US – December 2009, Mintel Oxygen, Brand Qualities19 Ice Cream Shop – US – December 2009, Mintel Oxygen, Advertising and Promotion20 www.yellowpages.com (September 14, 2010)21 Ice Cream Shop – US – December 2009, Mintel Oxygen, Leading Companies22Ice Cream Shop – US – December 2009, Mintel Oxygen, Brand Qualities

8

“Buy-One Get-One” promotion called BOGO for frozen beverages. Baskin-Robbins tries to engage its

customers and has a Birthday Club, which offers a free ice cream cone to every member on his or her

birthday and special savings coupons all year long via e-mail.23

Ben & Jerry’s brand’s identity is shaped by innovative combinations of traditional ingredients paired

with some very unorthodox names. 24 They have roughly 750 locations with approximately 500 of those

in the United States.25 Ben & Jerry’s had $240

million in sales in 2008, making up 18.5

percent of the leading ice cream shop

market.26 There are four locations in the

Tampa Bay Metropolitan Area.27 Ben & Jerry’s

spread environmentally-friendly messages and is committed to activism. The company uses limited time

offers of particular flavors to raise money and awareness for a variety of different causes. For example,

a limited edition flavor was launched to recognize Sir Elton John’s first trip to Vermont and to raise

money for the Elton John AIDS Foundation.28 The proceeds from this particular flavor were donated to

Elton John’s AIDS Foundation and simultaneously boosted the brand’s identity. Ben & Jerry’s also value

its customers and have employed a “Free Cone Day” as a customer appreciation effort for over 30 years.

Haagen-Dazs was the first super premium ice cream brand and was started by Reuban Mattus in 1960.

The company was originally packaged ice cream that was available in shops throughout New York City.

In 1976, the first Haagen-Dazs shop was opened by Rose Matthus, the owner’s daughter, and it was an

instant success.29 It is believed that Haagen-Dazs laid the groundwork for other super premium scoop

shops, including the brands greatest rival, Ben & Jerry’s. The

company currently has over 900 shops in 50 different

countries, including upscale locations in Europe and Japan.30

There are three locations within the Tampa Bay Metropolitan

23 Ice Cream and Frozen Desserts in the U.S.: Markets and Opportunities…6th Edition, pgs. 15924 Ice Cream Shop – US – December 2009, Mintel Oxygen, Brand Qualities25 Ice Cream and Frozen Desserts in the U.S.: Markets and Opportunities…6th Edition, pgs. 16026 Ice Cream Shop – US – December 2009, Mintel Oxygen, Leading Companies27 www.benjerry.com (September 14, 2010)28 Ice Cream Shop – US – December 2009, Mintel Oxygen, Innovations and Innovators29 “History” Haagen-Dazs September 20, 2010 http://www.haagendazs.com/company/history.aspx30 Ice Cream and Frozen Desserts in the U.S.: Markets and Opportunities…6th Edition, pgs. 127-128

9

Area.31 Haagen-Dazs had $100 million in sales in 2008, making up 7.7 percent of the leading ice cream

shop market.32 Haagen-Dazs prides itself on using simple and pure ingredients and promotes its brand

as, “made like no other”. The Haagen-Dazs brand trademark is the use of unique upscale ingredients

such as Bailey’s Irish Cream, caramelized pear & toasted pecan, and crème brulée. One of the brand’s

latest innovations, “Five,” features only five ingredients in the all natural ice cream. While the main goal

of releasing “Five, was to offer a pure and natural product line, it also claims to have less fat than its

other ice creams. 33

Generic Competitors Name Brand Ice Cream (Grocery Store) Generic Brand Ice Cream (Grocery Store) Smoothies Italian Ice Frozen Novelties Frozen Yogurt Gelato Coffee Juice

Total Budget Competitors Donuts Cookies Cupcakes Chewing Gum Potato Chips Pizza

Political Trends, Legal Trends and Regulatory TrendsFranchisingFranchising is a method of expanding a business and distributing goods and services in accordance with

terms and regulations set by the franchisor, also known as the business developer. The business

expands because the franchisor licenses its name and business operations to an individual or entity (the

franchisee).34 Franchising is a good way for someone new to business to start out because some else

31 www.yellowpages.com (September 14, 2010)

32 Ice Cream Shop – US – December 2009, Mintel Oxygen, Leading Companies33 Ice Cream Shop – US – December 2009, Mintel Oxygen, Brand Qualities34 Snyder, Garth 23 November 2009 “FAQ’s on Franchising” FranchisingLaw.com September 20, 2010

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has already worked out the business strategy. Over time, franchising has become increasingly more

popular and there was a franchise boom between the years 2002-2008. Each state has different laws,

but under Florida Law, “a franchise is an agreement between two or more persons that involves a

commercial relationship giving the franchisee a right to do business using the franchisor's services.”35

Nearly 1,400 Cold Stone stores have opened around the world over the last decade and in 2006,

Entrepreneur magazine ranked Cold Stone as the 11th fastest growing franchise. The initial application

process to become a Cold Stone franchisee can take up to three months. The initial franchise fee is

$42,000 and a total investment between $294,250 and $438,850 is required. When the application is

approved, Cold Stone must approve the store location and lease agreements. To ensure success, the

new owner must attend “Cold Stone University,” a two weeks training course located at the

headquarters in Scottsdale, Arizona.36

Food and Drug AdministrationIn the United States, there are 58 Million people considered to be overweight, 40 million people

considered to be obese, and another three million who are considered morbidly obese. These

percentages were calculated using the Body Mass Index (BMI) standards. Those with a BMI between

18.5 and 24.9 are usually considered healthy. Adults with a BMI between 25.0 and 29.9 are considered

overweight and adults with a BMI between 30.0 and 39.9 are considered obese. According to these

standards, a BMI over 40.0 is considered morbidly obese.37 These numbers are only increasing and it has

become a concern for the FDA.38 The FDA required all food items to have a complete nutrition label to

aid consumers in making healthy choices. Nutrition labels are not just for grocery items, in order to

comply with FDA regulations, ice cream parlors are required to have a nutrition label.39 All stores must

also abide by local sanitation standards and routine visits from Health Inspectors. In accordance with

Section 509.013, Florida Statutes states what exactly a food establishment is and then requires that

inspectors make routine visits about two times a year.40

35 “Florida Requirements” Guide to Florida Law: Florida Franchising and Dealerships . September 20, 2010 http://www.weblocator.com/attorney/fl/law/franchdeal.html36 "Cold Stone Creamery - Steps to Becoming a Franchisee." Cold Stone Creamery - The Ultimate Ice Cream Experience. Web. 16 Sept. 2010.<http://www.coldstonecreamery.com/franchises/steps_to_becoming_a_franchisee.html>.37 Jensen MD. Obesity. In: Goldman L, Ausiello D, eds. Cecil Medicine. 23rd ed. Philadelphia, Pa: Saunders Elsevier; 2007:chap 239.38 "Obesity Statistics for Adults, Children." Weight Loss Diet Program, FREE Diet Advice! Weight Loss Diets, Low Carb Plan . Web. 16 Sept. 2010. <http://www.annecollins.com/obesity/statistics-obesity.htm>.39 "Cold Stone Nutritional Information." Cold Stone Creamery - The Ultimate Ice Cream Experience. Web. 16 Sept. 2010. <http://www.coldstonecreamery.com/nutritional/nutrition_ingredients.html>40 "Food Service Definition." DBPR: Home Page - Florida Department of Business and Professional Regulation. Web. 19 Sept. 2010. <http://www.myfloridalicense.com/dbpr/hr/inspections/FoodServiceDefinition.html>.

11

Technological Trends

Many companies strive to become one step over the rest in the ice cream industry. Marble Slab

Creamery was the first company that used a frozen granite stone to blend super premium ice cream

with mix-ins. Frozen granite was chosen because it has a non-porous surface and can consistently

remain at five degrees Fahrenheit.41

Social e-gifting is a relatively new Facebook application that makes it easy for companies to engage

customers through social media. Consumers can go to the First Data Social e-gift page on Facebook and

41 https://www.coldstonecreamery.com/about/cold_stone_glossary.html

12

quickly send a tangible “gift” to a friend’s Facebook account or e-mail address. 42 The company has plans

to expand but currently only offers “gifts” from Cold Stone Creamery.

42 http://www.retailcustomerexperience.com/article/127182/Cold-Stone-Creamery-debuts-social-e-gifting-program

13

Economic Trends

The United States has the largest economy in the world, but is currently in what some consider an

economic crisis. It was predicted that the economy would be making a strong turn around this year but

last quarter (April – June 2010), the economy only grew 1.6 percent; less than the 2.4 percent that

economists had previously predicted. Economists believe that in order to prevent further

unemployment, the economy needs to sustain a 2.0 – 2.5 percent growth rate. Although things are

looking grim for the end of 2010, experts predict the economy will begin to pick up in 2011. 43 The

Tampa Bay area is experiencing very little economic recovery, is currently ranked as one of the weakest

metropolitan areas in the nation.44 The recession has heavily impacted the ice cream industry. Cold

Stone has closed approximately 160 stores in two years, and more than 20% of its current stores are up

for sale. Many franchisees are overwhelmed with debt, and some store owners are even claiming

personal bankruptcy.45

Income LevelsAs stated in the target market, there are 2,747,272 living in the Tampa Bay region. The average annual

household income is $64,267 and the median is $47,484. Tampa Bay falls under the national average

and mean which are $71,128 and $52,175 respectfully. The cost of living is less in Tampa Bay then many

areas and consequently people make less money which could account for the difference. The household

annual income levels are being affected by the high unemployment rate in Tampa Bay.46

Unemployment The entire nation is dealing with high unemployment rates and many people have little hope of finding a

job. Unfortunately, a big percentage of this group has also lost their home due to foreclosure. In 2009

the national unemployment rate was 9.8 percent and the Florida rate was much higher, 12.9 percent.

Although the entire nation is suffering, Tampa Bay is worse off with a reported 13 percent

unemployment rate during this same time period. 47

43 Grey, Barry. 28 August 2010“US slashes estimate of second-quarter economic growth” World Socialist Website. September 16, 2010. http://www.wsws.org/articles/2010/aug2010/econ-a28.shtml44 Harrington, Jeff. 15 September 2010 “Tampa Bay ranks Among the Worst in Economic Recovery” TampaBay.com September 16, 2010. http://www.tampabay.com/news/business/tampa-bay-area-ranks-among-nations-worst-in-economic-recovery/112167145 http://www.lewrockwell.com/decoster/decoster132.html46 “Demographics” September 16, 2010 Tampa Bay Population Regional Data Profile 2010. http://www.tampabay.us/relocation-information/regional-data-profile.aspx47 “Demographics” September 16, 2010 Tampa Bay Population Regional Data Profile 2010. http://www.tampabay.us/relocation-information/regional-data-profile.aspx

14

TaxThe on-going availability of sugar is essential to making super premium ice cream and there has been

concern of an anticipated sugar shortage. There is some concern that a sugar shortage may occur in the

next two years because of quotas on imports imposed by the USDA. 48 In addition to the possibility of a

sugar shortage, there is also the possibility that legislators could impose a “Fat Tax” on foods and/or

beverages high in sugar content.49

Inflation rateThe inflation rate is one of the most important economic forces because it consistently weighs in on the

value of a nation's currency. The inflation rate in the United Stated has remained fairly consistent and

averaged out to 3.5 percent from 2005-2009. In 2010, the interest is averaged out to be 1.85 percent,

and is forecasted to slowly drop for the rest of the year. On a seasonally adjusted basis, the CPI-U

increased 0.3 percent in August, the same increase that was reported in July.50

Trade RestrictionsThe Office of Foreign Assets Control (OFAC) of the United States, controls economic and trade

authorized based on the foreign trade laws. On January 1, 2008, the North America Free Trade

Agreement (NAFTA) was fully implemented. This allowed the United States, Canada, and Mexico to

48 FoodNavigator-USA.com, September 29, 200949 FoodNavigator-USA.com, July 29, 200950 http://inflationdata.com/inflation/inflation_rate/CurrentInflation.asp

15

benefit the agriculture and economic well being of each country. In order to trade within the

agreement, each food/drug product must follow requirements by the Animal and Plant Health

Inspection Service (APHIS) for all meat, plant, poultry, and egg products. Trade restrictions have now

been lifted from Mexico and the United States, and now allow sugar, corn, dry edible beans, nonfat milk

and high fructose corn syrup to be traded freely.51 The United States has spent nearly 20 million dollars

in an attempt to revitalize the Mexican production challenges and assist in better trading.52

Interest RatesThe current prime interest rate is 3.25 and is expected to increase to 3.50 in 2011 and to 4.0 in 2012. In

Tampa, Florida the sales tax associated with products is 7 percent.53 The increasing interest rates are

going to increase the recovery time of the economy and decrease consumption. Increased interest rates

affect the cost of borrowing and lead to higher taxes to cover increasing national debt. Consumer and

business confidence will remain low, causing an increase in savings and a decrease in disposable

income.54

Consumer Price IndexThe Consumer Price Index (CPI) program produces monthly data on changes in the prices paid by urban

consumers for a representative basket of goods and services. The index for all items, less food and

energy, was unchanged in August after rising 0.1 percent in July.55

Consumer ConfidenceMarketers want consumers to be confident, because confident consumers spend more money. The

recession officially started at the end of 2007 and with that, a drop in consumer confidence. By the end

of 2009, the percentage of confident consumers was on the rise and by the end of the year; the group

increased by 25 percent. For the first time in two years confident consumers outweighed anxious

consumers by 3.5 million, and 47.6 million were reported to be confident consumers.56

51 "North American Free Trade Agreement (NAFTA) —." USDA Foreign Agricultural Service (FAS). 2 Jan. 2008. Web. 20 Sept. 2010. <http://www.fas.usda.gov/info/factsheets/NAFTA.asp>.52 "Export Products Returned to the United States." FSIS Advertisement Rotator. 5 Sept. 2007. Web. 20 Sept. 2010. <http://www.fsis.usda.gov/regulations_&_policies/Export_Products_Returned_to_the_United_States/index.asp>.53 "Prime Rate Forecast: Projected Prime Rate Values 2010-2040." Mortgage-X ~ Everything There Is To Know About Mortgage Loans. Web. 20 Sept. 2010. <http://mortgage-x.com/general/indexes/prime_rate_forecast.asp>.54 "Effects of Increasing Interest Rates Economics Help." Economics Help - Helping to Simplify Economics. Web. 20 Sept. <http://www.economicshelp.org/macroeconomics/monetary-policy/effect-raising-interest-rates.html>.55 http://www.bls.gov/56 “The Post Recession Consumer” 2010 marketresearch.com September 14, 2010

16

Cultural TrendsDemographic TrendsAs stated earlier, there are 2,747,272 people living in the Tampa bay area and there is about an even

number of males to females. Three dominant races reside in Tampa and it breaks down to be 47.7

percent White, 25.2 percent African American, and 22.2 percent Hispanic Mexican, Puerto Rico, Cuban,

and others).57 African American household consume more ice cream then the typical American

household.58 The Hispanic culture has influenced some ice cream flavors, such as “dulce de leche”. The

Hispanic population is expected to grow, and if correctly marketed, will spend money.59

Generation X, ranging from 1961 to 1981, currently makes up about 20% of the population. They are

often single and still in college, due to taking time off for personal reasons. Generation X is concerned

with their health. They are considered a more materialistic generation that likes nice things. Their

salaries range from $15,000 to $45,000 a year, and they are more concerned with how they spend their

time rather than how much money they are making. Although money is not their main priority, many

are worried about retirement, and are concerned with spending money60

Generation Y, also called millennial’s, were born between 1979 and 1990. They are known as the most

ethnically diverse and technological savvy generation yet. The majority of generation Y is either still in

college or already holds at least a Bachelors degree. This generation believes money stands for success,

and put a lot of emphasis on their image and material items. This mindset has caused a good

percentage of them spend more than they make, resulting in low bank account balances and higher

debt. They tend to lead busy lifestyles, eat out often and put on weight.61

Lifestyle TrendsMany Americans are making a stride towards healthier lifestyles, and healthier desserts are becoming

more popular as well. These health trends are making frozen yogurt and healthy toppings, such as fruit,

a more favorable option when choosing a frozen dessert. Health and fitness have been becoming more

and more popular United States, however about 68% of adults and 32% of children are overweight.

Food portions in America are generally supersized, which cause many Americans to suffer from portion 57 "Tampa City, FL." U.S. Census Bureau. U.S. Census Bureau, 2008. Web. 20 Sep 2010. <http://factfinder.census.gov/servlet/ACSSAFFFacts?_event=Search&geo_id=&_geoContext=&_street=&_county=tampa&_cityTown=tampa&_state=04000US12&_zip=&_lang=en&_sse=on&pctxt=fph&pgsl=010>.58 "Per Capita U.S. Frozen Dairy Product Consumption (Annual)." Understanding Dairy Markets . Agricultural and Applied Economics, 2006. Web. 20 Sep 2010. <http://future.aae.wisc.edu/data/annual_values/by_area/2252?tab=sales>. 59 “The US Market for Ice Cream and Related Frozen Desserts.” Packages Facts. MarketResearch.com 200760 "Generational Market Research Bundle: Baby Boomers, Gen X and Gen Y." Packaged Facts . Market Research.com 200861 "Generational Market Research Bundle: Baby Boomers, Gen X and Gen Y." Packaged Facts . Market Research.com 2008

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distortion, and eat about 30% more than they would when served a smaller portion. Therefore, many

people in the US are trying portion control diets. Because of the popularity of portion control marketers

are introducing smaller portion snacks, such as 100 calorie packs, to promote weight loss. About 38.7%

adults watch their diet to maintain or lose weight, and about 20% count calories.62

The economy is currently ailing; in some situations parents may only be able to take their children out

for ice cream, preferably lower priced ice cream. Consumers of ice cream frequently look for variety and

new flavors when going out for frozen dessert. About 89% of US households keep ice cream or sorbet in

the house. A majority of adults prefer ice cream to other desserts, such as cookies or cake. In a survey,

67% said that it was worth it to indulge in full fat ice cream. Ice cream can be considered good for you

because of its good source of protein, calcium, and vitamins, but it is generally not, so it has been being

created in low fat or sugar free. Frozen yogurt is making a comeback as well, but in more flavors to

satisfy health conscious consumers.63

Cultural Values According to a study done by Panasonic to understand behavior and attitudes of families, 48% of

parents claim that they do not spend enough time with their children, and 63% would pay more on

technology if it meant spending more time with family. 98% of parents find it essential to spend time

with their family. Only 52% claim that they spend a sufficient amount time with family. Some parents

believe watching television and playing video games is spending quality time with their children. Others

believe technology is tearing their families apart and even leading to neglect. 84% of generation X’s take

pleasure in spending time with family, others would either spend time elsewhere or alone.64

62 “Weight Management Trends in the US.” Packaged Facts. MarketResearch.com 201063 “The US Market for Ice Cream and Related Frozen Desserts.” Packages Facts. MarketResearch.com 200764 "Survey: Families Need Technology to Spend Quality Time with One Another."Lifestyle . N.p., 02 Aug 2007. Web. 18 Sep 2010. <http://www.associatedcontent.com/article/334270/survey_families_need_technology_to.html?cat=25>.

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Analysis of the Customer EnvironmentWhoCold Stone Creamery is a market leader and ranked third in a 2008 list for growth of United States ice

cream chains.65 Cold Stone lists its “perfect demographics” as, a population of 15,000 within one mile,

consumers aged 18 to 36, and families with a household earning to $35,000 dollars or more.66 The

concept of Cold Stone is more than just ice cream; its mission is “to make people happy”. Cold Stone

lives up to this by offering an entertaining experience to consumers while they indulge in a customized

treat.67 A high level of customer service is what these consumers value and expect; it is why they are

loyal to the Cold Stone brand.

Psychographically, the customer base for Cold Stone can be easily compared to Starbucks coffee shops.

Consumers go to Starbucks for more than a cup of coffee; they go to have a personalized experience.

Creating a “customer experience” is sometimes referred to as the “Starbucks effect”. This effect has

been adopted and implemented by Cold Stone. Through this, Cold Stone is meeting the demands of its

customers and turning ice cream into much more than a commodity.

In most cases, the purchaser of a Cold Stone creation is also the user. Cold Stone creations would be

difficult for someone other than the user to pick out, because they are based up personal taste

preferences. There are times when one person buys multiple creations, but they usually know ahead of

time what each user wants. The purchasing decision is made by the consumer but can be highly

influenced with external forces. Cold Stone’s are located in high traffic areas where it is easy for

consumers to come in for a spontaneous treat. It is very common to see Cold Stone’s next to movie

theaters, schools, or in strip malls.

65 “Table 4-3 Leading U.S. Frozen Dessert Chains by Units, 2008” Ice Cream and frozen yogurt market U.S. marketresearch.com66 “Submit a site location: introduction” Cold Stone Creamery http://www.coldstonecreamery.com/about/submit_location_intro.html67 “The innovation track” Ice Cream and frozen yogurt market U.S. Marketresearch.com

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How manyCold Stone Creameries are franchising and its customer environment varies upon location. The average

check is $9.00, which is usually for two people. Most people visit a Cold Stone in pairs, but according to

a store owner in FL, it is not uncommon for consumers to come alone. On average, a Cold Stone store

serves 140 people per day on Monday through Thursday. Weekends tend to be busier, and a store will

serve 250 to 400 people Friday through Sunday. During football season, the weekend sales tend to

drop. The location of the Cold Stone also makes a big difference on consumer demand. A store next to

a movie theater would be busiest on Fridays, while a store on a college campus would be busiest

Monday through Thursday.68

Seasons tend to make a noticeable difference and most stores experience higher sales from March

through August. Depending on location, Florida for example, seasonal sales variations could be

irrelevant. To keep customer interest during colder months, Cold Stone creates special seasonal and

holiday themed flavors. In 1999, Cold Stone took a risk and opened a store in Alaska. It was quickly

discovered that consumers will eat ice cream even when it is cold outside. The Alaska store believes the

sales stay consistent because of the excellent product quality and having the right kind of employees to

create excellent customer experiences.69

68 Cold Stone Store owner in Winter Park, FL69 “Opening and ice cream store in cold seasons” U.S. Market for ice cream and other goods. Mintel Report

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WhatCold Stone makes its ice cream in stores daily using high end premium products. Every ice cream

served is referred to as a “Creation” because each one is considered “a work of art”. 70 The ice cream is

blended on a frozen granite stone, with different combinations of ingredients, to make unique creations.

There are over 11.5 million possible combinations that consumers can create and eat.71 The ice cream

can be served in a bowl, waffle cone or waffle bowl. The Creations are available in three sizes: like it

(5oz.), love it (8 oz.), and gotta have it (12 oz.).

Cold Stone Creamery also offers a “to go” option for at-home ice cream consumption. Consumers can

personalize a creation to bring home and choose from: “mine” (1-2 servings), “ours” (3-4 servings), and

“everybody’s” (4-6). Several different 32 oz. quart containers are available with preselected creations

for those that want to grab something quick to bring home. Health conscious consumers can indulge in

a Sinless Sans Fat, a non-fat no sugar added ice cream. Cold Stone Creamery also offers a variety of non-

dairy Sorbets and non-dairy Smoothies to meet consumers’ health needs.

In 2009, Cold Stone entered the gourmet cupcake market and began creating ice cream cupcakes to sell

in-store. The three Cold Stone signature cupcakes are, Cake Batter Deluxe, Sweet Cream and Double

Chocolate Devotion. The cupcakes are sold in packages of six for $9.99.72 In addition to the cupcakes,

Cold Stone Creamery has some other alternatives to scooped ice cream: Ice-Cream Cakes, Ice Cream

Cookie Sandwiches, Smoothies, Shakes, and Iced and blended Coffees.

Cold Stone Creamery uses several complimentary products with its ice cream. Waffle Cones can be

thought of as complimentary because it would not be consumed without ice cream. Several “mix-ins”

that are used to make a “Custom Creation” can also be considered as complimentary products. These

include: apple pie filling, cherry pie filling, peach pie filling, graham cracker pie crust, caramel, cinnamon,

fudge, sprinkles, sugar cone pieces and honey.73 Although the listed “mix ins” are tasty, they wouldn’t

necessarily be consumed alone.

70 Ice Cream and Frozen Desserts in the U.S.: Markets and Opportunities…6th Edition, pg. 16271 http://www.coldstonecreamery.com/icecream/about_our_ice_cream.html (October 1, 2010)72 Ice Cream Shop – US – December 2009, Mintel Oxygen, Innovations and Innovators73 http://www.coldstonecreamery.com/icecream/custom_creations.html (October 6, 2010)

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Today, consumers are focused on “going green” in almost every aspect of their lives. Frozen dessert

marketers are trying to appeal to these consumers by implementing environmentally friendly practices.

Kahala Corp., the parent company of Cold Stone Creamery, reported in March 2008 that it was drafting a

three year plan to incorporate more sustainable and green practices. Among its efforts would be

initiatives such as, incorporating more water and energy-efficient equipment at the company’s

headquarters and eventually at chain units; challenging suppliers of food and paper products to provide

more sustainable and fair trade goods; and remodeling or developing stores to incorporate more eco-

friendly features. The company reported that it is too early to determine how much the implementation

process would cost franchisees.74

74 Ice Cream Reporter, March 2008 (October 5, 2010)22

Why and HowCold Stone Creamery offers personalized ice cream creations, shakes, smoothies, cupcakes and cakes for

each customer and strives to “make people happy.” Cold Stone is in the business of making people

happy and even made it their mission statement. Staying true to the mission statement is how Cold

Stone satisfies its customers emotional and comfort needs. Consumers might also visit Cold Stone

simply because they are hungry and a Cold Stone treat meets that basic need.

Cold Stone’s biggest competitor is Marble Slab Creamery; it has five locations in the Tampa Bay area and

offer very similar products. Although Marble Slab can compete on the basis of similar products, they do

not have the same “entertainment” factor as Cold Stone. For example, Cold Stone sings a song every

time someone puts money in the tip jar, where Marble Slab does not. Cold Stone went a step further in

connecting the customer with their ice cream by categorizing size and already set creations. The names

of the sizes, “like it”, “love it” and “gotta have it”, allow the customer to connect emotionally and pick

out a treat size with ease.

To meet the demands created by the health craze, there are frozen yogurt chains that have been

expanding into the Tampa Bay area. Many have a “do it yourself approach,” where customers can

dispense their favorite flavors and toppings and then pay by weight.75 Competitors such as Yogurtology,

You Say When and Soobak Yogurt Bar have entered the Tampa Bay market and created a healthy and

fun option for consumers that want to indulge with fewer calories. Cold Stone didn’t always meet the

needs of consumers who wanted a healthy option, but they have added healthier substitutes to its

menu. Some of the Healthy menu items are, low calorie smoothies, no sugar added ice cream and an

assortment of healthier mix-ins. 76 Cold Stone has met the demands of consumers who want convenient

and quick payment options. At all stores accept cash, credit and debit cards and Cold Stone gift cards.

75 27 Sept. 2010. <http://www.coldstonecreamery.com/about/cold_stone_culture.html>.76 27 Sept. 2010. <https://www.coldstonecreamery.com/icecream/healthy_indulgences.html>.

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WhenCold Stone Creamery understands that the economic downturn has created drops in sales. People had

to give up luxuries and indulgences that included fancy dinners and vacations. Even in tough economic

conditions, people still need a “getaway” and time to spend with their family.77 Cold Stone encouraged

people to try new products while interacting with their family at Cold Stone stores. Indulging in a Cold

Stone experience was one way families could take a mini vacation without serious costs.

The Cold Stone on Fowler Ave in Tampa typically has three rushes during a typical business day. The

first rush is when the store opens and consists mostly of professionals on their lunch break, who come in

for ice cream after their lunch. During the afternoon Cold Stone gets a second rush of parents who bring

their children for ice cream after school. The third rush is before closing, and consists mostly of college

students. At this particular location weekends are the busiest days, as well as Mondays because of

student discounts. At this location, there is very little difference in seasonal sales because Florida

weather is pretty consistent throughout the year. Although the difference is small, it is worth noting

that even in Florida; sales during “winter months” are slightly lower than other times of the year.

Cold Stone creamery has consistently held promotions and special sales for consumers. Being part of

the community is very important to Cold Stone, and it gives back in multiple ways each year. It gets

involved with school fundraisers, charitable organizations and supports the Make-A-Wish foundation.

Cold Stone Creamery dedicates the entire month of September to raising money for the Make-A-Wish

foundation, which helps grant wishes for severely ill children.78 This year Cold Stone was a part of

“Kate’s wish” which was to create an exclusive ice cream mix for Cold Stone. On September 30, 2010,

they held the 9th Annual World’s Largest Ice Cream Social, where it gave away free samples of Kate’s

Creation.79 Cold Stone also gets involved with customers on Facebook. On a regular basis, Cold Stone

updates its status, responds to customers, answers questions, and posts information about particular

stores.80

77 29 Sep 2010 <http://www.qsrweb.com/article/127404/Ice-cream-industry-faring-relatively-well>78 29 Sep 2010.<http://www.coldstonecreamery.com/about/community.html>79Cold Stone Creamery. 29 Sep 2010. <http://www.coldstonecreamery.com/promos/makeawish/index.html>80Facebook. September 29, 2010. <http://www.facebook.com/coldstonecreamery?v=wall&viewas=0>

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Why Non CustomersUnique creations and treats at Cold Stone are delicious, but come with a price. The price of a Cold Stone

creation is usually higher than other ice cream shops and is significantly higher than ice cream at a

grocery store. Cold Stone successfully captures customers with a higher level of disposable income but

does not meet the needs of those on a tighter budget. Those on a strict budget have less disposable

income and cannot justify spending over $4.00 on a single ice cream treat.

Cold Stone is not only expensive, but also high calories. In most cases, it is not favored by those who are

trying to keep a healthy diet. At the request of its customers, Cold Stone introduced a line of “Healthy

Creations”. Even with these options, most consumers who live healthier lifestyles probably steer away

from Cold Stone. This could be because they are trying to resist a temptation to choose a high calorie

treat, or they simply not aware of the healthier options available.

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WhereCold Stone creations are only sold at franchised locations. In the Tampa Bay area, consumers can visit

anyone of the fifteen prime locations.81 Locations are most likely found in strip malls, near movie

theaters and in other heavily trafficked locations. Regardless of the

surrounding, store locations are always densely populated. Cold Stone

has expanded internationally and has introduced stores in ten

countries: Japan, South Korea, Taiwan, China, Indonesia, Mexico, U.A.E.,

Bahrain, Qatar, and Denmark.82 Cold Stone has a plan to become the

biggest ice cream store in the world and have been working diligently to

expand globally and remain a market leader.

Cold Stone has the capabilities cater events, both large and small. Since Cold Stone Creameries are

franchisees, each owner has his/her own policy with regards to catering. Cold Stone is able to bring its

potable store to almost any location. For most events consumers are able to place orders directly over

the phone.83

Most consumers love convenience and now they can have personalized creations delivered to their

homes in Tampa. Tampaeatz.com lets consumers order from over 30

different restaurants including Cold Stone Creamery. Orders can be

easily placed online or by calling 813-253-EATZ.

81 http://www.coldstonecreamery.com/google/stores/store_locator.aspx

82 http://www.coldstonecreamery.com/franchises/international.html

83 http://www.coldstonecreamery.com/about/company_faq.html#Store__locations

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Analysis of the Internal EnvironmentMarketing strategiesTarget Market

Cold Stone’s target market consists of consumers that like to indulge in super premium ice cream.

These consumers are looking for more than just ice cream; they are looking to have an experience. Cold

Stone has higher prices than other ice cream shops, but its target market is willing to pay, to get exactly

what they want. Cold Stone offers personalized service to each customer, allowing them to create their

own treat, and leaves them wanting to come back for more. According to the Cold Stone website, each

franchised location should be in a high traffic area with at least 10,000 people in a one mile radius.

Additionally, it recommends that Cold Stone’s are put in strip malls, near movie theaters, or near other

restaurants. Most ice cream is bought on impulse, which is why these heavily trafficked areas work best.

According to a store owner in FL, his target market consists of adults who come in alone or in pairs. He

also said adults tend to bring kids on the weekend, but that they almost always order something for

themselves too. In general, its target market is very similar to Starbucks, consumers who are willing to

pay a little extra to indulge in a small treat.

ImageCold Stone was started by Donald and Susan Sutherland after they realized that the world did not have a

“perfect” ice cream. In 1988 they went on a quest to change the world, redefine ice cream, and opened

their first store in Tempe, Arizona. 84 Cold Stone positions itself to be the world’s best ice cream and

considers it to be in a class of its own. Cold Stone makes its ice cream daily, in each store, from the

freshest ingredients. Using only the finest ingredients means its products are considered to be “super

premium”. The Cold Stone image is something much bigger than just ice cream; it is a place that leaves

people happy and wanting to come back for more. It is where people can come and indulge, have fun,

and relax.

84 “The Cold Stone Story” www.coldstone.com October 13, 2010

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Marketing ProgramsAdvertising

Cold Stone Creamery uses several different marketing programs to

increase consumer awareness and build relationships with ice cream

lovers worldwide. Through advertising, Cold Stone hopes to reach more

consumers and provide them with the ultimate ice cream experience.

Over the holidays in 2009, Cold Stone launched a mobile coupon

program where cable networks ran commercials asking viewers to text

“CREAM” to the number provided. Viewers that sent the text message

received a mobile coupon good for one free “love-it” size creation, when an additional treat is

purchased. The goal of the program was to get consumers inside the stores and ultimately drive sales.

The promotion targeted families, which allowed people of all ages to take advantage of the coupon, as

long as they had a mobile phone.85 The mobile coupon also appealed to, “green-minded” individuals

who favor paperless options for coupons. It created more foot traffic in the stores and got consumers

excited because they were being given something “free”. This was the first time Cold stone used mobile

marketing and the promotion was considered a success.

In 2007 Cold Stone Creamery released the “LOVE IT LOVE IT” campaign which tests consumer’s devotion

to their ice cream. The goal of the campaign was to capture the public’s love for ice cream and position

Cold Stone as the number one place in the world to eat ice cream. The campaign dramatizes the

consumers’ journey to a Cold Stone Creamery, and then creates obstacles that our put in their path,

thus testing their desire for ice cream. The advertisements were meant to be dramatic, humorous and

mysterious, they were supposed to draw consumers in and leave them wanting to know more. Each

advertisement was its own story that displayed a struggle about how far one will go to get something

they really want.86 This was Cold Stone’s first integrated advertising campaign and they used television,

online, radio, and a “LOVE IT LOVE IT” micro site. In the end, the campaign had mixed results on

whether it was successful or not. People can stay engaged with the “LOVE IT LOVE IT” campaign by

going to loveit-loveit.com, where they will find an archive of advertisements, characters and bloopers.

85 http://www.mobilemarketer.com/cms/news/commerce/2617.html (October 12, 2010)86 http://findarticles.com/p/articles/mi_m0EIN/is_2007_May_22/ai_n19155014/ (October 12, 2010)

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On July 7, 2010, Cold Stone teamed up with First

Data Corporation to offer a new gifting application

through Facebook. "Thanks to social networking

sites, texting and the growing abundance of web-

enabled mobile devices, the way people interact as

well as give and receive gifts is changing," said Dom

Morea, First Data division manager of Mobile

Commerce Solutions.87 Loyal Cold Stone fans can

now quickly and easily send a tangible gift (ice

cream Creations, shakes) to a friend or loved one's

Facebook account or e-mail address. Consumers can access the eGift social application through Cold

Stone's Facebook page or website and select one or multiple friends to send gifts to, by either by adding

them from Facebook or entering their e-mail address. The sender can then select which product they

would like to send their friend and can add a personal message. The sender of the eGift is able to then

proceed through the secure checkout process. After the sender “checks out” the recipient receives a

Facebook message, e-mail or both alerting them that they received a gift. Included in the message are

the account number and redemption instructions. The recipient can redeem the eGift item at any

participating Cold Stone location. 88 Cold Stone loves to “make people happy” and this gives people an

opportunity to share a Cold Stone moment even if they cannot be together.

Product and Service OfferingCold Stone Creamery has something for everyone with over 11.5 million possible creations.89 The

signature flavors are: Cake Batter, Chocolate, Coffee, Mint, Strawberry, Cheese Cake,

French Vanilla, Sweet Cream, and Sinless Sans Fat. In addition to the signature

flavors, stores offer local and season flavors such as Cinnamon Bun,

Pumpkin, Amaretto and candy cane. Cold Stone offers customers a wide variety of mix-ins for

their creations that include candy, fruit, nuts, cakes and cookies. For consumers that prefer

something other than scooped ice cream, Cold Stone has ice-cream cakes, ice cream cookie

sandwiches, smoothies, shakes, and iced and blended coffees.

87 http://www.retailcustomerexperience.com/article/127182/Cold-Stone-Creamery-debuts-social-e-gifting-program (October 12, 2010)88 http://www.retailcustomerexperience.com/article/127182/Cold-Stone-Creamery-debuts-social-e-gifting-program89 http://www.coldstonecreamery.com/icecream/about_our_ice_cream.html (October 13, 2010)

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Distribution and Channel ProgramsCold Stone Creamery has 1,400 franchised stores with 194 in Canada and other foreign countries. Cold

Stone is expanding globally, and is constantly looking to work with people that share its passion for ice

cream. Cold Stone franchise owners use in-store, online, and direct marketing channels.

PricingPrices at Cold Stone vary by size, item and by store. Cold Stone sells its ice creams in 3 different sizes:

Like it (5 oz), Love it (8 oz), and Gotta have it (12 oz). There is no set price per size because it depends

on the ice cream and mix-ins. The average price range for the three sizes is: “Like it,” $3.00 to $5.00;

“Love it,” $3.20 to $4.20; and “Gotta have it,” $4.00 to $5.50. Each ice cream order includes one

topping, such as fruit or candy, and then each additional topping or cone is 75 cents. Prices for

smoothies and shakes vary by size, and are respectively $2.69 to $4.29. Cold Stone serves coffee either

iced or blended in small, medium and large and are priced $2.69, $3.69, and $4.09 respectively. Cakes

can be made in small, medium and large and are generally priced $10.00, $19.95, and $25.95

respectively. Cold Stone provides premade pints to go for $6.49 or customers can make their own, with

up to three toppings, for $7.99.

Sales strategy and Sales force effectivenessCold stone has been unique and innovative in its different sales strategies. The most recent launch of its

eGift program has been very successful thus far. The eGifting idea was introduced to increase in store‐

revenue and drive franchisee profitability.90 Inside Network Inc., an industry research firm, states that

the U.S. market for virtual goods is currently estimated at $1.6 billion. Social networking sites account

for approximately half the total market for virtual goods, twice as much as one year ago. Unlike

traditional virtual gifting, Cold Stone’s eGift application is used to send tangible gifts that can be

redeemed in participating locations. The application was developed by e commerce and payment‐

processing industry leader, First Data Corporation‐ 91

Marketing research /intelligence gathering effortsCold Stone’s aims to provide ice cream lovers the ultimate customer experience. To gain insight on its

efforts, there is a brief online survey available to the public. The survey has a very colorful scheme,

background music and a comical song to stay consistent with the Cold Stone brand and ensure a

90 http://www.coldstonecreamery.com/assets/pdf/news/2010/pr_cold-stone-creamery_egift_070710.pdf91 http://www.coldstonecreamery.com/assets/pdf/news/2010/pr_cold-stone-creamery_egift_070710.pdf

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satisfying “survey taking experience”.92 Mystery shopping is also used to enforce excellent customer

service and satisfaction. Cold Stone wants to make sure that every customer receives exceptional

service and has an unforgettable experience. 93

Public relations/publicityCold stone creamery established created its own personal website which provides information that

dates back to 2003. Establishing this website early on, took them from being a localized ice cream shop

to a globally recognized ice cream powerhouse, which rivals organizations such as marble slab. Cold

stone participates in major food shows, all over the world, to create product awareness and provide

sampling. For the E! Entertainment network's 20th Birthday party, Cold Stone provided an exclusive

custom ice cream blend, "E! Entertain-mint”.94 Cold stone also partners with the Make-A-Wish

Foundation to help “grant wishes” to terminally ill children. Most recently, Kate an 11-year-old with a

life-threatening condition, wished that cold stone would participate in the

“World’s Largest Ice Cream Social.”95 Cold stone created an exclusive flavor for

Kate and on September 30th, from 5:00 to 8:00 PM, customers could receive Kate’s

creation free. This was definitely the world’s largest social and Kate’s wish came true!

92 http://www.csc1.com/93 http://www.satisfactionservicesinc.com/corporateoverview.htm94 http://www.coldstonecreamery.com/about/press_room.html95 http://www.coldstonecreamery.com/assets/pdf/news/2010/news_make-a-wish_090110.pdf

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Financial Performance

Cold Stone creamery is the fifth largest ice cream shop in the United States and was ranked number 35

in the Entrepreneurs 2010 Franchise 500.96 In 2008, its sales were about $430 million but have recently

experienced an increase in sales due to new and successful items such as, cup cakes and coffee. Cold

Stone is expecting the growth in sales to continue from recent co-branding efforts with Tim Hortons

INC.97 Cold Stone has been franchising stores since 1994 and currently has 1,400 franchised units,

including 194 in Canada and other foreign countries. Since 2008, this number of new stores opening has

dropped domestically, but has risen in foreign countries, including the 13 new stores opened that have

opened in Canada this year.98 Even with the domestic setbacks, Cold Stone is still considered to be one

of the fastest growing franchises.99 In order to open a franchise, a total investment from $292,525 to

$440,275 would be necessary. The potential owner would also have to be able to pay the $42,000

franchising fee, and meet the $125,000 cash liquidity requirement. Cold Stone is a private company and

does not provide sales or potential profits to interested franchisers.

Additional Company CharacteristicsTechnical CapabilitiesCold Stone has used many innovative technological resources to attract its customers. Customers can

interact with Cold Stone online by creating a My Cold Stone account, which allows the customer to have

96 "Entrepreneur." 2010 Franchise 500 Rankings. Entrepreneur Media, 2010. Web. 13 Oct 2010 <http://www.entrepreneur.com/franchises/rankings/franchise500115608/2010,.html>.97 “Mintel Oxygen.” Ice Cream Shop Analysis: Cold Stone Creamery. Mintel Group, 2010. Web. 13 Oct 2010. <http://academic.mintel.com.ezproxy.lib.usf.edu/sinatra/oxygen_academic/search_results/show&/display/id=393515/display/id=501043>98 "Entrepreneur ." Cold Stone Creamery. Entrepreneur Media, 2010. Web. 13 Oct 2010. <http://www.entrepreneur.com/franchises/coldstonecreamery/282219-3.html>99 “Mintel Oxygen.” Ice Cream Shop Analysis: Cold Stone Creamery. Mintel Group, 2010. Web. 13 Oct 2010. <http://academic.mintel.com.ezproxy.lib.usf.edu/sinatra/oxygen_academic/search_results/show&/display/id=393515/display/id=501043>

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a personalized space on the Cold Stone website. My Cold Stone account holders are eligible to receive

special offers and join the birthday club. Cold Stone uses the club and social networking as a cost

effective alternative to traditional advertising. Cold Stone does use any special gadgets to blend its

creations, but they do use state of the art ovens, refrigerators and freezers to provide the freshest treat

possible.

Available ResourcesCold Stone provides new franchise owners all the resources they need for success. The entire processes

of starting a new store, completing the necessary training and opening the doors for business takes

about a year. Not rushing this process ensures that the new owners will represent the Cold Stone brand

and exceed expectations. Each new owner is required to enroll at Cold Stone University, at the

headquarters in Scottsdale, AZ, for approximately eight weeks. Cold Stone University offers courses

where the new owners learn everything they need to know, including how to present the Cold Stone

experience to their future customers.100

Production CapacityCold Stone provides each customer with a unique experience and each creation is hand made in front of

the customer’s eyes. Cold Stone does not pride itself on producing a quick product, but instead on the

consistence and quality of its treats. Cold Stone customers do not expect quick service and visit the store

to have an experience and indulge in their favorite ice cream creation. Cold

Stone does have options for those with busy schedules such as pre-made

creations, cakes and pies. Every store is different, but most have several

tables located inside and outside the store.

Career OpportunitiesThere are over fourteen hundred stores operating around the world that

provide a variety of career opportunities. A new Cold Stone can be opened

almost anywhere, allowing some customers to own a piece of their

favorite treat if they qualify. The process of becoming an official owner of

a Cold Stone can take as little as three months. Each owner is followed while they secure a location,

negotiate the lease and finalize the location specifics. Each owner is sent to Cold Stone University,

100 “Franchise overview” www.coldstone.com October 13, 201033

where they are taught to live and exceed Cold Stone’s expectations.101 The entire process, including

training, can take up to a year to complete.

All Cold Stone locations have career opportunities on both large and small scales. Each store provides

full time, part time and management opportunities. Small scale jobs, like crew members, are great for

teenagers and are popular “first jobs”. A potential crew member is “auditioned” instead of having to go

through the typical interview process. Crew members prepare ice cream creations while providing the

ultimate customer experience. Crew members are enthusiastic, dedicated, team players and have

excellent customer service skills. On a larger scale Cold Stone provides opportunities at its corporate

headquarters in Scottsdale, Arizona. Corporate opportunities include web design, formulating

promotions and creative concepts, and testing, finance, accounting, managing, training, customer

service and supply.102

SWOT AnalysisStrengths

Statement of Internal Strengths

Company Performance Importance Strength Index Number

1=Minor 2 3 4 5=Major 1=Low 2 3 4 5=High

1. Growth X X 20

101 "Cold Stone Creamery Franchise - Facts on Ownership." Cold Stone Creamery - The Ultimate Ice Cream Experience. Web. 12 Oct. 2010.

<http://www.coldstonecreamery.com/franchises/facts_on_ownership.html>.102 "Cold Stone Creamery - Steps to Becoming a Franchisee." Cold Stone Creamery - The Ultimate Ice Cream Experience. Web. 12 Oct. 2010. <http://www.coldstonecreamery.com/franchises/steps_to_becoming_a_franchisee.html>.

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2. Store locations X X 203. Cold Stone

Creamery Customer experience

X X 25

4. Premium ingredients

X X 25

5. Advertising campaign

X X 12

6. Product offerings X X 207. Marketing

researchX X 15

8. Public relations X X 169. Financial success X X 2010. Consistency &

qualityX X 16

11. Website quality X X 1212. Facebook page X X 1213. Co-branding X X 15

1. Cold Stone Creamery is a market leader and ranked third in a 2008 list for growth of United States ice cream chains. There are 15 locations in the Tampa Bay Metropolitan area.

2. Locations are most commonly found in strip malls, near movie theaters and in other heavily populated and trafficked areas.

3. Consumers in target market are looking for more than just ice cream; Cold Stone Creamery provides and outstanding customer experience that can be compared to Starbucks.

4. Cold Stone only uses the finest “super-premium” ingredients to make its ice cream fresh daily.

5. Cold Stone Creamery teamed up with First Data Corporation to offer a new gifting application that is available through Facebook.

6. With over 11.5 million possible ice cream creations and additional menu items, Cold Stone has something for everyone.

7. Cold Stone offers a brief online survey available that is open to the public. Mystery shopping is a strategy that Cold Stone uses to enforce excellent customer service and ensure superior customer satisfaction.

8. All Cold stone press releases can be found on its website and is archived back to 2001. The company makes community service and working with charities a priority.

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9. Cold Stone is the fifth largest ice cream shop in the United States and sales have recently increased from new menu items and its co-branding efforts.’

10. Cold Stone Creamery provides a consistent customer experience and quality treats to consumers.

11. An interactive website where a consumer can create a My Cold Stone account which is a personalized space on the Cold Stone website. The website lists anything anyone would want to know about Cold Stone, except for financial performance because it is a private company.

12. Cold Stone utilizes Facebook and engages its customers by posting promotions, contests and fun facts on its page.

13. Recently, Cold Stone decided to begin co-branding which will provide more options for its customers and capture a bigger target market.

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Weaknesses

Statement of Internal

Weaknesses

Company Performance Importance Strength Index

Number1=Minor 2 3 4 5=Major 1=Low 2 3 4 5=High

1. Price X X X 25

2. Waiting Time X X 20

3. Franchisee Training

X X 6

4. Limited Expansion in the Saturated Market

X X 9

5. Volume Limited to Employees

X X 12

6. Large portion sizes

X X 12

1. Consumer confidence is at an all time low and customers are turned away from Cold Stone’s high priced creations.

2. Each Cold Stone creation is made especially to the customer’s satisfaction, which can lead to long wait times for customers.

3. The intense franchisee training can take over a year to complete which can turn away potential investors.

4. Cold Stone offers a product in an extremely saturated luxury good market leading to limited future expansion possibilities.

5. Cold Stone offers a product in an extremely saturated luxury good market leading to limited future expansion possibilities

6. Customers are watching their portion sizes, and Cold Stone offers generous servings.

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Opportunities

Statement of External

Opportunities

Activeness Success probability Opportunity Index

Number1=Minor 2 3 4 5=Major 1=Low 2 3 4 5=High

1. The Hispanic market

X X 25

2. University of South Florida

X X 25

3. Health conscious consumers

X X 15

4. Smaller ice cream shops are going out of business

X X 6

5. Consumers that eat organic

X X 12

6. Tampaeatz.com X X 16

1. As stated in our internal analysis, the Hispanic market in Tampa Bay area is rapidly growing and would be an excellent opportunity for market growth

2. University of South Florida- Placing a store on the University of South Florida campus could be very profitable and/or have USF partner with the off campus Cold Stone nearby.

3. Cold Stone should consider creating new flavors with nutrition content that would appeal to health conscious consumers. This is a trend that is not fading in America.

4. Smaller ice cream shops that have to close because of the economy, will give Cold Stone an opportunity to open new stores in the area to gain additional market share.

5. The percentage of consumers that eat organically is increasing. Creating organic flavors would meet the needs of these potential customers.

6. TampaEatz.com allows consumers to conveniently place an Cold Stone ice cream order online and get it delivered to their home within one hour.

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Threats

Statement of External Threats

Likelihood of Occurrence Seriousness Index Number1=Minor 2 3 4 5=Major 1=Low 2 3 4 5=High

1. Bad Economy X X 25

2. Competition X X 15

3. Health Conscious Movement

X X 9

4. Credit Crunch X X 25

5. Lacking Resources

X X 12

1. The United States is in a recession and the economy has only grown 1.6% this year. Unemployment rates are at an all time high, especially in Florida. People have less disposable income to spend which could cause them not to go out for ice cream.

2. There are many competitors in the frozen dessert industry that offer similar products such as, Marble Slab Creamery and Ben and Jerry’s.

3. Healthy lifestyles are becoming increasingly popular in the United States. About 38.7% of adults watch their diet and would probably prefer to eat healthier deserts.

4. It is becoming more difficult to obtain a personal or small business loan because banks are scared to lend money due to increases in defaults.

5. It is possible that a “Fat Tax” will be applied to foods high in sugar content, which could affect the production and cost of the ice cream.

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Marketing Goals and ObjectivesGoals

Implement new marketing strategies to increase customer awareness throughout Tampa Bay.

Develop Marketing techniques to better target the Hispanic community in Tampa Bay.

Open Cold Stone’s in areas throughout Tampa Bay that could be profitable for a Cold Stone

Creamery.

Add additional menu items and/or flavors that cater towards a health conscious consumers.

Continue to grow as a franchise in the global market and throughout the United States.

Maintain the current ranking as one of the fastest growing franchises.

Increase website interaction at www.ColdStoneCreamery.com

Increase the protection of copyrighted and trademarked property of Cold Stone Creamery to

sustain the super-premium ice cream brand.

Increase community relations with the Make- A-Wish foundation

Maximize the use of the Public Relations department to insure positive relationships with Cold

Stone customers

Create an effective customer loyalty program for the Tampa Bay area.

Objectives

Open 3 new locations in the Tampa Bay area by December 2012.

Increase the number of Cold Stone customers in Tampa Bay by 15% by December 2011

Open one new Co-branded Cold Stone in the Tampa Bay are by December 2011.

Increase Revenue at each franchise by 15% during 2011.

Run a promotion with USF during the spring semester of 2011.

Boost the sales for holiday inspired treats by 10% this year (year end 2010).

By December 2012, increase the number of repeat customers by 15% through a loyalty card

program.

Create an Organic flavor by May of 2011 and offer it in at least one Cold Stone store as a six

month trial.

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Marketing StrategiesTarget market

The target markets are geographically segmented for the Tampa Bay region and include the following

counties: Hillsborough, Hernando, Pasco, and Pinellas. The United States Census Bureau reported a total

population of 2,747,272 for the Tampa Bay region.

Primary market: 249,985 consumers who are 15 - 34 years old.

Demographic segmentation: age

o In 2009, Mintel reported that 44 percent of their 18 - 24 year old respondents and 38

percent of 25 - 34 year old respondents had visited an ice cream shop in the past 3

months. (Ice Cream Shops US) Consumers aged 15 - 17 were not included in this

particular study, but are part of the primary target market because teens are likely to

visit ice cream shops. In 2003, BuzzBack Market Research took a survey of 500 teens and

43 percent would choose to snack on ice cream if given options. ( Ice Cream and Frozen

Novelties)

Psychographic segmentation: Impulsive behavior

o In 2009, Mintel reported that 39 percent of their respondents decided to go to an ice

cream shop at the very last minute and 42 percent decided to go within the hour. (Ice

Cream Shops US)

Secondary market: 346,676 families with children, who have an annual income greater than $25,000.

Demographic segmentation: income

o The secondary market will include families making an annual income of at least $25,000.

Cold Stone is considered “super premium” and its products are usually priced higher

than other ice cream shops

Special occasion segmentation: indulgence

o Marketresarch.com reported that 60% of their respondents with children aged 3 – 12;

allow them to indulge in small treats. (The U.S. Kid’s Food Market)

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Value Proposition

Company and Product

Target Customers Benefits Price Value Proposition

Cold Stone Creamery

Adults and Families with Children

A superior customer experience

20% premium

The world’s greatest ice cream, with the highest quality ingredients, for a

premium price.

Positioning Statement

Cold Stone: To young adults and families, who like to indulge in super premium ice cream, Cold Stone is

where you can go to create your own customized ice cream treat. At Cold Stone, ice cream treats come

with superior customer service and a unique customer experience.

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Issues Analysis

Cold Stone’s biggest strengths are the number of strategically placed store locations, its image, the

customer experience provided and a history of financial success. Cold Stone’s are found in heavily

populated, high traffic areas where consumers are most likely to impulsively buy ice cream. Perspective

owners must meet all of Cold Stone’s regulations, including a population requirement surrounding the

new store. Cold stone has goals to continue expanding throughout the United States and across the

globe and it is predicted that Cold Stone will remain a market leader in the super premium ice cream

industry. Cold Stone creates a unique experience for each customer which is consistent with its brand

image. Consumers value specialized treatment and entertainment, making them more likely to pay

higher prices. Cold Stone has experienced strong financial success in most of its franchises. Recently,

there has been Cold Stones go out of business, but that number is outweighed by success of other stores

and continued expansion of the company. Financial success can be contributed to many things, but the

strict criteria Cold Stone makes perspective franchisee’s meet; helps ensure profitable ice cream shops.

Strict regulations also help keep each Cold Stone franchise consistent with the brands overall image, and

allow the company to better reach its objectives and goals.

Cold Stone strengths are important, but it is also important to monitor its biggest weaknesses: price,

wait time and portion sizes. Cold Stone has high prices, and there are plenty of consumers willing to pay

for a Cold Stone treat, but there is also a huge population that cannot afford Cold Stone. In Florida,

consumers are still getting laid off and remain unable to find employment. This leaves many people

without the disposable income they once had to spend on things like Cold Stone. Consumers that still

have jobs are not spending as much because of low consumer confidence. It is recommended that Cold

Stone review its pricing strategy and consider a revision. The high wait time at Cold Stone is because

each treat is made specifically for the customer. One of the company’s strengths is creating an engaging

customer experience, which creates a weakness because this increases the customer wait time. Cold

Stone has to-go options for its customers that are in hurry, but that still doesn’t ensure quick payment

and checkout. Cold Stone’s smallest serving, “like it,” is too big for someone watching their weight or

for health conscious consumers. The percentage of overweight Americans is rising and when they

decide to get healthy, they will have to cut Cold Stone out of their diet. To remain competitive, Cold

stone could reevaluate its serving sizes and consider creating a “taste it” size, for those that want a

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smaller treat. Indulging is small sized snacks is an emerging trend and would meet the needs of

consumers watching their weight.

If Cold Stone successful exploits its best opportunities, it would create new strengths for the company.

The Hispanic market is growing in the Tampa Bay area, and this is a demographic that is known to like

sweets. Currently, there is a huge opportunity to market to this population and get them to value the

Cold Stone experience. Cold Stone should consider creating new flavors that would specifically appeal

to the taste buds of this group. There is a Cold Stone located near USF, but it is not marketed well to the

USF population. This is another huge opportunity for Cold Stone because of the heavily populated

campus. The promotion strategies should be reviewed to create new ways the Cold Stone shop could

better market to the USF population. Cold Stone could also exploit the needs for people who prefer to

consume “organic” food items. The number of consumers who prefer to eat organically is on the rise

and Cold Stone should consider creating flavors with premium ingredients that are also considered

organic.

It is important for Cold Stone to monitor its top threats: the economy, its competition and the increase

in the number of health conscious consumers. The economy is considered to be in recovery mode, but

Florida is worse off than most of the nation. This has also resulted in a credit crunch and it is very

difficult to for people to obtain loans for personal use or for a small business. Banks are scared to lend

money because of increasing default risk and when they do lend money, it is at a higher interest. The

areas where the credit crunch is most severe, Tampa Bay being one of them, should be reviewed so Cold

Stone can stay on target for its expansion goals. The number of consumers that value healthy lifestyles

is increasing and is also a major threat to Cold Stone. As consumers become more health conscious,

they will begin to value healthier dessert options like frozen yogurt. The abundance of frozen yogurt

shops opening in Tampa Bay can be attributed to this threat and it is also creating increased

competition. Many consumers are also opting to buy ice cream at the grocery store because it is less

expensive. These consumers are now trying to save money and indulge at home instead of indulging in

higher priced foodservice ice cream, making packaged ice cream a huge threat to the continued success

of Cold Stone.

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Action PlansValpak Savings Coupons

Objective: To increase awareness and foot traffic for the Cold Stones in the Tampa Bay metropolitan area.

Target Market: Primary and secondary markets.

Description of the Program: A coupon will be placed in the Valpak mailings offering: buy two “love

it” size ice creams get one of equal size free. The coupons will be

offered to all individuals within our target markets. This program will

appeal to cost conscious consumers and will be a way Cold Stone can

try to establish relationships through value.

Who: The different Cold Stone franchise owners at the locations in the Tampa Bay metropolitan area.

Timing: Coupons sent out in April 2010. Good through September 2010

Budget: We will be sending the Valpack to our Primary target market (249,985 consumers) and

secondary target market (346,676 consumers). The total number of consumers that will

receive the coupon is 596,661. Valpack can be purchased for 100,000 households for

$300.00. We will need 600,000 @ $300.00 per 100,000 households = $1,800.00 total to print

the coupons. The cost of consumers redeeming the coupon is ($3.00 “love it” size x 5%

reach) (29,833 coupons redeemed) = $89,499. Total Valpak Budget: $91,299

Measurement: The coupons will be collected at each of the 15 locations and sales will be evaluated before the promotion is run again.

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Free Smoothie Sample at Gasparilla Distance Classic Race Expo

Objective: To reach out to consumers who are “health conscious” and give them the opportunity to

taste a Cold Stone smoothie.

Target Market: Half Marathon, 10k, 5k, and one mile fun run race participants

Description of the Program: Free samples of Cold Stone Smoothies will be given away at the

Gasparilla Distance Classic race expo. At least 20,000 people will

come through the expo over the two day period which gives Cold

Stone a unique opportunity to target this health conscious group.

Who: The different Cold Stone locations in the Tampa Bay metropolitan area will decide who will work

the booth at the expo.

Timing: During the race expo hours at the Tampa Convention Center (Friday, Feb. 25, 2011, 10 am –

8:00 PM and on Saturday, Feb. 26, 2011, 6:00 AM– 5:00 PM).

Budget: Booth rental cost = One (1) 10’ x 20’ Booth Space (Corner/Interior- includes two (2) 6’ tables,

four (4) chairs, wastebasket & sign) = $2,000. Cost of samples is ($0.04 per 1 Oz. paper cup

w/smoothie)*(1000 samples per hour)*(21 hours) = $840. Total Cost = $2,840

Measurement: The success of this plan will be measured by how much sales increase during the

month of March after the samples are given out during the race expo. March’s sales

should be compared to the previous months to see if there is a difference.

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Customer Loyalty Card

Objective: To turn one-time or infrequent customers into regular customers.

Target Market: All Cold Stone customers

Description of the Program: Customers that visit their local Cold Stone can pick up a “punch card” at

the counter when they are paying for their treat. Customers will

receive one punch for each ice cream treat or smoothie they buy but it

excludes kid size ice cream treats. Once the customer fills their card

with ten “punches,” they can redeem it for one free “love it” size treat

or smoothie.

Who: The different Cold Stone franchise owners in the Tampa Bay metropolitan area.

Timing: The promotion will run indefinitely.

Budget: It is estimated that each store will give out at least 5 free “love it” size treats per month.

$3.39*(5) = $16.96. $16.95*(15 stores) = $254.25 a month. = $3,051 a year.

Measurement: The success will be based on the percentage increase in sales and how many “fully

punched” cards are collected.

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University of South Florida Freshman Orientation Promotion

Objective: To increase awareness and foot traffic for the Cold Stone creameries.

Target Market: New Students that will attend the mandatory orientations at the different University

of South Florida locations

Description of the Program: Cold Stone will provide a stack of post-its that can be put in incoming

freshman student orientation bags. The post-it on top will be a

promotional coupon that students can tear off and bring in to the

nearest Cold Stone location. The new student will receive 50 percent

off the original price of one “love it” size ice cream.

Who: The different Cold Stone locations in the Tampa Bay metropolitan area will honor the coupons.

Timing: Fall 2011, during the freshman orientations at all University of South Florida campuses.

Budget: There will be roughly 5000 incoming freshman at the four different USF locations. 5000 post-

its can be ordered through Stick2it.com for $ 1,370 and it includes shipping. We estimate 20

percent of the freshman will take advantage of this [((5000*.20) = 1000 freshman)(1000*

2.00 loss from sale)] = $2,000 cost. Total cost for this promotion is $3,370.

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Measurement: The success of this promotion can be measured by how many coupons are turned in at

each of the stores and if sales increased during the remainder of the semester.

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Tuesday Free Kids Giveaway

Objective: The purpose would be to get parents to bring their kids into Cold Stone and hopefully

indulge in a treat for themselves.

Target Market: Parents with children age 10 and under

Description of the Program: During the summer season (when kids are out of school) kids age ten

and under can receive a free kid’s size ice cream on Tuesday nights

from 5:00 PM to closing. Giving treats away to children ten and under

will create a sense of value to adults and will as a result drive

customers to come in when they otherwise would have passed on

super premium ice cream.

Who: The individual franchises will honor Kid’s Tuesday nights at the Cold Stones in the Tampa Bay metropolitan area.

Timing: Every Tuesday night, from 5:00 PM to closing and it will continue indefinitely.

Budget: (Kid’s 3 Oz. @ 1.69 )*(20 kids per day) = $33.80*(4 days per month) = $135.20*(12 months per

year) = $1,622.40*(15 stores) = $24,336.

Measurement: While the kid’s ice creams are free, they will still be rung up on the register so the

different locations can keep track of how many free kids cups are given out each

Tuesday night nights. The success of the promotion will

be measured by how much sales increase on Tuesdays.

The Stores will track to see if sales increase from parents

or older siblings that won’t be receiving a free ice cream.

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Dog Yappy Hour

Objective: To try to increase store traffic and sales by encouraging consumers with pets to enjoy a

treat together. It will also encourage them to sit and relax and socialize with each other,

hopefully making Cold Stone a regular meet up spot.

Target Market: Owners with dogs who like Super premium ice cream

Description of the Program: On the first Friday of the month dogs will get a small taste of ice cream

with the purchase of a “like it”, “love it” or “gotta have it”. Owners

will be able to bring their dog(s) to the 15 Cold Stone locations in the

Tampa Bay Metropolitan area and will create an environment where

dog owners will be able to socialize with other dog owners. Each dog

will enjoy a 1 oz. sample size of vanilla ice cream with a dog treat

placed on top. Dog Yappy Hour will take place from 3 p.m. till closing.

Who: The respective Cold Stone franchises in the Tampa Bay Metropolitan area will honor the

promotion.

Timing: First Friday of each month from 5pm till close from May to August

Budget: (1 oz. @ $0.50) x (15 dogs per day) x (4 months) x (15 stores locations) = $450. $7.00 bag of

dog bones (@ about 75 bones per bag) x (15 store locations) = $105. Total Dog Yappy Hour

Budget: $555.00

Measurement: The success of this promotion will be measured by keeping track of sales and seeing if

there is an increase. After the program ends in August, the stores could also measure

success by tracking September sales to see if the dog owners keep coming to Cold

Stone.

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Student Study Break promotion

Objective: To give students a reason to take their study break at Cold Stone during finals weeks.

Target Market: All college students in the Tampa Bay metropolitan area

Description of the Program: During finals weeks students will be given the opportunity to receive a

“gotta have it” size for the price of a “like it” size at all 15 locations in

the Tampa Bay Metropolitan area. Students will be required to show a

student ID. This promotion will give students the added

encouragement to have a study session at Cold Stone creating a

positive environment for meeting and treating at the local Cold Stone

locations.

Who: The different Cold Stone locations in the Tampa Bay metropolitan area will honor the Student

ID’s

Timing: First two weeks in December and first two weeks in May

Budget: ($3.39– $3.29) = 0.10 x (20 students per day) = 2.00 x (4 weeks) x (15 store locations) = $120.00 total.

Measurement: The success of the program will be measured by the increase in foot traffic over the

finals weeks during the two different time periods the promotion is held.

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Clear Channel Outdoor Digital Billboard

Objective: Increase awareness of store locations and store traffic by showing indulgent treats from Cold Stone ready for consumption

Target Market: The entire Tampa Bay Metropolitan Area

Description of the Program: Cold Stone will implement a series of advertisements on all 12 clear

channel outdoor billboards located in the Tampa Bay

metropolitan area. The advertisement will be designed

to increase this “impulsive” buying behavior across the

target market. Cold Stone will buy into the Tampa Bay

Half Network which means the advertisements will

appear in every other rotation in the area. This

provides Cold Stone with 6,420 spots per day which

amounts to a reach percentage of 68.7. That’s 539,280

total spots. Each advertisement will contain a key super-premium ice cream term. This will be used to

measure success. Mentioning the term will enter each customer in a contest for a $100 dollar gift card.

The drawing will be held at each store location at the end of the 12 weeks.

Who: The 15 Franchise owners of the Cold Stones in the Tampa Bay metropolitan area.

Timing: For 12 weeks beginning March 2011

Budget: 12 weeks on Half Network = $66,000. $100 gift card x 15 store locations = $1,500. Total Clear

Channel Digital Billboard Budget: $67,500

Measurement: The key term mentioned above will help Cold Stone to understand the reach of each

particular billboard. Using this term and the sales associated with each term Cold

Stone will be able to determine the success of the campaign.

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Senior Citizen Afternoon Happy Hour

Objective: To increase sales and foot traffic and try to appeal to a different demographic that may not

normally choose to go to Cold Stone.

Target Market: Senior citizens, who are over the age of 65, in the Tampa Bay metropolitan area.

Description of the Program: Senior Citizens will be offered one dollar off a “like it” size ice cream

from 12:00 PM to 3:00PM on Thursdays. In an effort to create

awareness Senior Citizen Afternoon Happy Hour will be promoted at

senior centers throughout the Tampa Bay Metropolitan area. The

program is designed to appeal to a demographic that finds “deals” to

be as important as quality. By offering this “deal” Cold Stone will be

able to offer greater value to senior citizens.

Who: The different Cold Stone franchises in the Tampa Bay metropolitan area.

Timing: During “snow bird” season, from November to February, on Thursdays from 12:00 PM to

3:00PM.

Budget: 10 seniors x 15 stores = 150 senior citizens. = $ 150.00 x 16 Thursdays = $ 2,400

Measurement: The success of the promotion can be measured by tracking the sales generated on

Thursdays from 12:00 PM to 3:00 PM from senior citizens.

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Monthly Customer Drawing

Objective: To give back and thank customers while also giving them an incentive to indulge at Cold

Stone and turn them into more frequent visitors.

Target Market: Customers at the different Cold Stone locations

Description of the Program: This will be a monthly drawing where two customers will each receive

$15.00 Cold Stone Gift cards. Each store in the Tampa Bay area will

have a box where customers can fill out a card with their contact

information and enter it to be part of the contest. The winners will

be pulled on the 15th of each month and notified within 24 hours.

This promotion is also consistent with what Cold Stone already does

in the community. It will be a way for the company to give back to

the Tampa Bay area and hopefully create repeat customers and

positive buzz.

Who: The different Cold Stone locations in the Tampa Bay metropolitan area.

Timing: Once a month for a trial for a trial period of 3 months.

Budget: ($15.00 for each gift card x 2) = $30.00 ($30.00 x 15 stores) = $450.00 total

Measurement: After the three month trial period, the store owners will evaluate if the program is

worth continuing at their location. The respective store owners will see if customers

are getting excited or if the program is creating a buzz in their store and it will be up

to them if they want to continue. They can measure the success of the program if

they see an increase in foot traffic and sales or patterns of repeat customers.

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Marketing Budget

Valpak Savings Coupons

Free Smoothie Sample at Gasparilla

Distance Classic Race Expo

Customer Loyalty Card

University of South Florida

Freshman Orientation Promotion

Tuesday Free Kids Giveaway

$91,29946.6%

$2,8401.45%

$3,0511.55%

$3,3701.72%

$24,33612.42%

Dog Yappy HourStudent Study

Break promotion

Clear Channel Outdoor Digital

Billboard

Senior Citizen Afternoon Happy

Hour

Monthly Customer Drawing

$555.29%

$120.06%

$67,50034.45%

$ 2,4001.23%

450.23%

Total Budget Expenditure: $195,921

Cold Stone requires each of its stores to spend 3% of its sales on marketing. We estimated that the Cold

Stone’s in the Tampa Bay area each make $380,000 per year in sales. Based on this estimate, our total

budget is equal to 3.43% of each store’s average annual income. We decided to raise the current

budget that the stores have now so we can better achieve our goals and objectives.

The most important and expensive action plan it the Valpak savings coupons. Valpak coupons are an

important strategy that would allow our customers to save money on their ice cream while also

increasing foot traffic and sales for the Cold Stone stores. The budget for the Valpak savings coupons

was based on 596,661 consumers in our primary and secondary target markets. The coupon would

allow consumers to buy two “love it” ice creams and get the third one free.

We decided to include the University of South Florida and students in two of our plans because it is such

a huge school in this area, with multiple campuses and potential customers. We decided to give new

students a discount during orientation, so that they would get to know the cold stone locations near

school and possibly come back during the school year. This strategy targets new students in the

beginning of the semester while or next strategy targets all students at the end of the semester. During

finals week, we created a promotion that will give students a discount and a study break. Students can

come into any of the Cold Stones in the Tampa Bay area, show their student ID, and will be able to buy a

“Love it” size treat for the price of a “like it”.

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What We Learned

Melinda: The most valuable thing that I took from this project was being able to work with an

extremely motivated group and create a great marketing plan. I especially enjoyed learning about the

marketing aspect of a business, as well as working with my team mates. Everyone did an equally

amazing job, and everyone was able to meet deadlines and stay on top of the project. At first, I had

some difficulty with the research, but this project improved my researching and writing skills immensely.

I had never done a marketing plan before; it was a great learning experience and it also increased my

interest in the marketing field. Other then the hours of tedious research, I honestly enjoyed doing my

parts of the project.

Ashley: The most valuable learning experience for me was seeing all the work that goes into a

marketing plan. A marketing plan isn’t just full of creative and fun ideas to try to implement into a

business. The marketing plan is almost all background and research information in order to discover

beneficial promotions or changes in the business. The most enjoyable part of this project was my group;

we were all extremely motivated to getting things accomplished quickly and to its full potential. This

allowed the group to get along and each individual was able to work to their full potential. I am a

creative person and so I enjoyed the action plans the most. My least favorite phrase was the research

phases due to the lack “creativity” that it involved.

Kristin: Working on this marketing plan was one of my favorite projects I have done at USF. This is my

last semester, and our group was the best one I have ever been a part of. We are all hard workers, who

like to give 100% and turn in our best work. When we formed our group, we made sure we all had the

same expectations of what a “good” project was. We set clear deadlines, and everyone followed

through. We figured out early on what each of our “strong points” were, and tried to divide up the

project so that we could deliver excellent work, every time. My least favorite part of the project was

figuring out the numbers for the target market because it seemed like it took way longer than I

expected! After that, I thought the whole thing was pretty easy, especially when you have a group like

ours. I really enjoyed this class and working with team to create a successful marketing plan.

Sean: I found that creating a market plan takes a lot of creativity and a good strategy to be able to

compete in today’s business world. This was my first marketing plan and I feel like I have expanded my

knowledge and that it will help me in my career. While creating different advertising and promotional

strategies, I found that being innovative with new ideas can really help grab your target markets

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attention. I also found the SWOT analysis extremely useful and helped us make the right decisions to

keep the company successful and headed in the right direction.

Tom: During the completion of the marketing plan, I realized that I really enjoy working with people.

Verbal and written communication are very important skills to have in the work place and this project

gave myself and my teammates a real-life experience to both learn from and enjoy. My group was

extremely successful in making deadlines, working together, and understanding each other’s strengths

and weaknesses. As a result, our finished project is rightly a compilation of our hard work. My favorite

and most valuable learning experience during the course of the project was the research phase. I have

always had a creative mind but I found it very interesting to take the time to understand the market we

were working on and to find information that would help us create the correct promotional mix. During

this process I actually found it difficult to put down my computer as I was constantly looking for market

research that helped to solidify our claims. Overall, I am extremely satisfied with my group’s enthusiasm

and energy and I truly enjoyed Marketing Management and our Cold Stone Creamery marketing plan.

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