Godiva Brand Brief

Brand Brief Nerissa Marbury, PMP Creative Brand Manager VCU Brandcenter / Course: Global Brands 26 January 2009

Godiva Chocolatier: The Brand

The Legacy Born out of a small praline-making business run by the Draps family in Brussels, Belgium, Godiva was originally Chocolaterie Draps until Joseph Draps decided he wanted to produce a more exclusive chocolate and open up a chocolate shop.

Joseph Draps created a line of chocolates with �extraordinary richness and design, a collection of passion and purity.� He sought a name that embodied the timeless qualities of passion, style, sensuality and modern boldness. With the help of his wife, Godiva was the chosen name in honor of the legend of Lady Godiva.

1958: 1st Boutique outside Belgium was opened in Paris, France.

1926: Founded

1967: Campbell Soup bought Godiva from Draper Family.

1966: 1/3 stake sold to Campbell Soup 1st Boutique in North America opened in Philadelphia, PA.

1972: 1st N. America boutique opened in New York City.

Godiva became available in Japan.

1968: Began producing in U.S. using Belgian recipes.

2007: Campbell sold Godiva to Yildiz Holding of Turkey for $850MM.

1998: 1st Godiva Store in Hong Kong

Today: Godiva available in over 80 countries around the world.

The Vision: Joseph Draps, Founder & Chocolatier

Create the world's most elegant, handcrafted chocolates for discerning consumers

Future: Envisioned

We, at Godiva Chocolatier, want to be the curator for guilty pleasures and share our miniature pieces of edible art with the world. Like the Kaşıkçı Diamond*, Godiva is a gem preserved by polishing and promoting it in unknown markets.

Every time the beguiling image of Lady Godiva is seen, man and woman will undergo an emotional reaction. Godiva will erase all woes and brighten every smile.

Admirers will become addicted to the sensatory overload from the indulgence occurring the moment they let go of self-restraint and allow temptation to overtake them.

*A precious 86-carat, pear-shaped diamond on exhibit at Topkapı Palace in Istanbul.

Godiva Style & Core Ideology

Miniature piece of art with exquisitely balanced counterpoint of aroma, flavor and texture.

• attention to detail • design excellence • top-notch service

Five Facets of Fine Chocolate

Everything is decided by Godiva: the choice of cocoa beans, the degree of roasting, the fineness of grinding, the purity and the homogeneity of the chocolate paste.

Each chocolate is a miniature piece of art

uses only chocolate made from 100 percent cocoa butter

Over 80 years of quality Belgian chocolate production made with proven processes.

uses only grade A ingredients

Source: Godiva.com finechocolateindustry.org

One-of-a-kind taste experiences Smell the Chocolate:

Savoring fine chocolate begins when you open the box and take in the bouquet of the contents. Fine chocolates have a fresh, deep aroma, not the overly-perfumed or sugary smell associated with artificial flavors or preservatives.

Look at the Chocolate:

Fine chocolates have a consistent color and natural-looking satiny sheen free of air bubbles or other blemishes. The best chocolates also display a high degree of craftsmanship in their shapes and designs.

Listen to the Sound:

With the notable exception of truffles, the couverture or outside coating of fine European-style chocolates is often molded in a sleek, semi-hard shape that "snaps" when you bite into it.

Feel the texture: A fine chocolate is velvety smooth without the graininess that comes from incomplete refinement.

Taste the Chocolate: Freshly made fine chocolates have very intense but refined flavors and subtle nuances of textures. The inside of fine chocolates is specifically intended to complement the couverture in terms of flavor and texture.

Allow the flavors to permeate your mouth. The initial taste is a nutty, roasted chocolate flavor, followed by sweetness and other flavor components. Lastly, fine chocolates have a longer "finish" or pleasant aftertaste that lingers on the palate.

Source: Godiva.com

Product Selection Gift Baskets & Towers

Gold Collection, Assorted Chocolates

$44 - $200

$3.50 - $150

Biscuits, Coffee and Cocoa

$16.50 - $70

Exclusive G Collection

$8.50 - $25

$24.75 - $85

Chocolate of the Month

Truffles

Chocolate Bars

$17.75 - $70

Gifts

Bridal & Party Favors

$3.50 - $38

Beyond Chocolates

Dark Chocolate $8.50 - $70 Birthday

$13 - $70

Thank You

$15 - $150

Godiva Belgian Blends $185 - $540

Godiva Liqueur Godiva Baked Goods Source: Godiva.com Note: All Prices are in US dollars

Available at Godiva Boutiques & Select Retailers Only

Source: Godiva.com Note: All Prices are in US dollars

The Ballotin Godiva’s iconic, signature package is the Gold Ballotin (French for “small, elegant box of chocolates.�

In addition, Godiva produces seasonal and limited edition chocolates with special packaging for all major holidays.

Retail Distribution Channels Online: 421,037 unique monthly visits Boutiques: Over 480 world wide Wholesale: Over 2,000 retailers Catalog: Six per year Mobile: Unknown Source: Godiva.com compete.com

Connecting & Engaging with the Consumer Godiva has undertaken a combination of merchandising PR, in-store promotions, web site promotions and sampling initiatives or experiential marketing to increase awareness and market new products.

• Held a charitable auction celebrating the influence of taste and style as it is passed from generation to generation. Pairing mothers and daughters, and protégés and mentors to benefit a variety of causes, Godiva looks forward to continuing the success of last year’s auction.

• During Fashion Week in New York, Godiva gave sleep deprived and malnourished fashion folk a sugar fix

with chocolate deliveries. Editors were able to pick from an elaborate menu of goodies and place an order for chocolate dipped strawberries, macaroons, berry dessert cups, and banana strawberry kabobs.

• Ringing of the opening and closing of the New York Stock Exchange bell on Valentine’s Day. • Leveraged the promotional opportunity afforded by Miramax Films' hit Chocolat, giving holders of tickets to the movie free samples and sponsoring a contest which offered the winner a trip for two to Brussels.

• Hired a double decker bus for 5 days to act as Godiva Chocoiste Convoy that took passengers from the

Godiva store at the World Financial Center to Times Square, all the while handing out the chocolates to the passengers. Sent samplings and VIP pass for the convoy to media.

• Hired people to give out samples of the chocolate at the Central Park in NY • Created a chocolate personality quiz in a new website http://www.areyouachocoiste.com/ after which the user could redeem a free gift certificate for free chocolates.

Connecting & Engaging with the Consumer Online campaigns the Godiva Way • Create a special site engaging the target audience through the clever use of a survey (Ex. visitor receives a free sample and Godiva obtains more information about the target audience) • Place a graphic/button of the new product or promotion on the homepage of the main Godiva.com website • Use lush photography to showcase the products • Provide an option to see larger image of the product • Cross-sell products using the ‘Other Options Available’ on each product presentation page

Previous Media & Communications

The World of Chocolate

Fact Sheet: China

Population (in millions): 1,321.3 Language: Mandarin (Vernacular Chinese) Economy: China is one of the few large economies whose banking system has not been crippled by the global credit crunch. The economy is expected to revive by midyear and achieve GDP growth of close to 8% for 2009.

Wealth: China has 106 billionaires and 4,935 "Ultra-HNWIs" (Ultra-High Net Worth Individuals), defined as those with financial assets of more than US$30 million.

Fifth-most millionaire households of any nation with 414,900 people owning at least US$1 million in liquid assets.

Chinese Countries or Territories: Hong Kong, Macau, Taiwan, Singapore Sources: china.org.cn afp.google.com

Industry Experts on China

"Chinese people in the past only considered chocolate as something with a sweet taste and brown color. Now they are beginning to realize that chocolate can represent more than just snacks and fashionable assortments."

- Elvin Ho, Asian Pacific marketing director of Barry Callebaut, the world's biggest chocolate maker

"The maturing chocolate culture has prompted Chinese consumers to begin asking for a greater variety of premier products. High-end chocolates are expected to see the fastest growth in the next few years, which is also in line with the global trend."

- Jason Foo, business development director of Aslst Chocolate, a Singapore-based manufacturer

Source: china.org.cn

The Global Market The Chocolate Industry Total global chocolate market of US$75 billion The Premium Chocolate Category (US$8+ per pound) Premium chocolate represents a fast-growing and dynamic market in many parts of the world, yet is less than 10% of the total global chocolate market.

The global premium chocolate market is valued at almost US$7 billion, which reflects a 65% increase since 2002. The premium category has risen over 18% increase in the last year.

The Super-Premium Category (US$40+ per pound) A narrower definition of “super premium� chocolate reduces the global market size to about US$1.25 billion.

Source: researchandmarkets.com

The Chinese Chocolate Industry

• Valued at US$813 million, representing a 10% increase over prior year.

• Chocolate imports total US$56.8 million (9,521 tons), a 21.5% increase over prior year.

- The U.S. accounts for 23% ($8.4 million - 2,233) chocolate imports.

• Chocolate retail sales are expected to reach US$1.23 billion by 2012.

• Chocolate consumption is increasing 10 to 15 percent a year as living standards and acceptance of Western styles rise.

• Milk chocolate is the favorite flavor with Chinese consumers, accounting for 38 percent of value sales of chocolates in 2007. Of all fillings, nuts are the most popular.

Source: china.org.cn Source: ecandy.com/traderegulations.aspx

The Chinese Chocolate Industry (cont’d) • The history of China’s chocolate manufacturing history is less than 50 years old, which has caused an inevitable gap behind foreign brands in terms of production techniques and technologies.

- Due to inappropriate processing equipment and incomplete production facilities, product quality assurance is difficult for many local chocolate companies.

• Most Chinese chocolate companies are weak in product R&D, resulting in slow product changes and updates. At present, most local chocolate companies are stuck in an embarrassing situation of low product quality.

• With their considerable financial power, multinationals can play their technological and cultural cards, as well as promote their premium quality and unique tastes, to rapidly capture the Chinese market.

- Foreign chocolate brands such as Dove, Cadbury and Hershey’s have captured 70% of the Chinese chocolate market.

Source: economist.com

Competition - Direct Direct

Indirect Cadbury:

Significant producer in China with its brands ranking in the top three in sales for chocolate, sugar confectionery, and gum.

Saw sales skyrocket 87% in 2006 with less than US $5 million in sales in premium chocolate. Only premium chocolate manufacturer with a worldwide distribution.

Hershey’s:

Determined to achieve 23% Chinese market share of the local market by 2010 and the runner-up position in China. Partnered with Lotte to have candy produced in China.

Nestle: Sales have doubled in China since 2001 Local Chinese Companies: Has shown the greatest premium sales growth last year per Packaged Foods.

Unable to compete with multinational companies on a levelplaying field because improvement is needed in product quality, select of raw ingredients, production facilities, use of international technologies, product innovation and brand management.

Non-category:

Champagne, Exotic Blooms,

etc.

Source: mediapost.com

Market Opportunities & Challenges Opportunities • Belgian chocolates enjoy a sterling reputation for high-quality ingredients.

• China has a fast-growing middle-class and large population • Growing level of health conscious consumers within China Challenges • Educate the target on the quality and taste difference between Godiva and mass-produced premium chocolate already on the shelves.

• Higher prices of global players scare away Chinese customers who do not have the purchasing power of their Western counterparts.

• Difficult to gauge how popular chocolate goods will be once country is more fully developed, but growth will likely be significant.

• Perception of a Turkish owned American company that produces Belgian style chocolates.

Source:: fool.com

Cultural Explorations

The Discerning Godiva Consumer

Characteristics • 66% of chocolate is consumed between meals • 22% of all chocolate consumption takes place between 8P and midnight • More chocolate is consumed in the winter than any other season • Interested in buying luxury products and enjoying up-market tourism • Big spenders on wellness, accounting for 14% of their passion dollars Shopping Behavior • General gift giving - Birthday, romantic gesture, thank you, etc.

• Seasonal - New Year, Easter, mother's day, The Night of Sevens / Magpie Festival (V-Day), Winter Solstice Festival, etc.

• Other - Treat self, dinner party, house staple, etc.

Sources: sfu.ca china.org.cn businessweek.com

Cultural Tidbits

People Identity Many ethnic groups exist in China; however, the pre-eminent ethnic group is the Han Chinese (92% of the population). The term Zhonghua Minzu describes Chinese nationalism in general. Much of the traditional cultural identity within the community has to do with distinguishing the family name.

Social Values Most social values are derived from Confucianism and Taoism with a combination of conservatism.

Literature The Five Cardinal Points are the foundation for almost all major studies. Concepts covered a wide range of subjects including poetry, astrology, astronomy, calendar, constellations and many others.

Source: en.wikipedia.org beijingmadeeasy.com

Cultural Tidbits Leisure The most common game is Mah Jong. The same pieces are used for other styled games such as Shanghai Solitaire. Others include Pai Gow, Pai gow poker and other bone domino games. Weiqi and Xiangqi is also popular. Ethnic games like Chinese yo-yo are also part of the culture.

Superstitions White is the color of death and is thus avoided. Yellow is the color of heaven. The dragon is a divine being capable of bestowing happiness and good fortune. Red and gold are both extremely auspicious, but do not write in red as it is considered rude.

Gifts Etiquette dictates you must bring a gift when visiting a Chinese person in their home.

Fruit, flowers, tea or sweets would be appropriate or cigarettes or alcohol if you know the person partakes. Foreign items have prestige value.

Source: en.wikipedia.org beijingmadeeasy.com

The Assignment

The Task: Expansion within the Asian Market Budget: US$2.5 million (CNY 17,110,500)

Location: Shanghai, China • Set the stage for Godiva to own the luxury chocolate category in China. • Identify consumer segments Godiva should pursue and recommend effective methods to reach and engage the target.

- Understand the tastes, habits, behavior and expectations of consumers and adapt our communications to suit the culture.

China: Market Challenges

Challenges • Educate the target on the quality and taste difference between Godiva and mass-produced premium chocolate already on the shelves.

• Higher prices of global players scare away Chinese customers who do not have the purchasing power of their Western counterparts.

• Difficult to gauge how popular chocolate goods will be once country is more fully developed, but growth will likely be significant.

• Perception of a Turkish owned American company that produces Belgian style chocolates.

Source:: fool.com

Measuring Campaign Success

• PR coverage of the campaign/event/product • Media/broadcast coverage of the campaign/event/product • Store sales • Visits to the specifically designed website associated with the campaign • Clicks from the Godiva.com homepage to the new product section or promotion

Brand Brief Nerissa Marbury, PMP Creative Brand Manager