Consumer Behavior (Old Town) Essay

Introduction The company that we had choose is Old Town White Coffee (OTWC). The history of OTWC can traced back to the incorporation of White Cafe in 1999 , with the intention to provide quality white coffee to Malaysian households and the food services industry , the co-founders and Executive Directors , Mr Goh Ching Mun and Mr Tan Say Yap formulated their own blend of 3-in-1 instant white coffee and commenced manufacturing in 1999 . The OTWC goal is to let everyone enjoy every sip of authentic Malaysian Ipoh White Coffee anytime and anywhere.

Nevertheless, the vision of OTWC is to be the Asian Pacific’s Leading White Coffee producer providing high quality products to customers globally. Besides that, the company mission is to promote the unique Malaysia taste- the authentic Ipoh White Coffee and continue White Coffee Legacy the rough continuous improvement and innovation that exceeds customer expectations. Secondly, by setting precedence OTWC have made a standard that equals excellence, and pushing other brands to do the same.

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Next, strive for continuous improvement, incorporate innovations and technology in our commitment to create customer value in our both product services. And lastly, maintain and reinforce their market leader status and move forward to become a leading White Coffee producer in Asia Pacific. The target market of OTWC is more to workers and teenagers . For workers they can have their breakfast in OTWC before going to work . OTWC got provide breakfast set so is easy for workers to choose , beside breakfast OTWC also have lunch set .

While for teenagers , they can have a gathering in OTWC . They can have a drink and have some snack like bread and desserts that have in OTWC . Motivation Motivation is described as the driving force within individuals that impels them to action. This driving force is produced by a state of tension that exists as the result of an unfulfilled need. Individuals strive, both consciously and subconsciously, to reduce this tension through behavior that they anticipate will fulfil their needs and thus relieve them of the stess they feel.

The specific goals they elect and the patterns of action they undertake to achieve their goals are the result of individual thinking and learning. In other word, the study of motivation refers to all the processes that initiate the drive in a person to perceive a need and pursue a definite course of action to fulfil that need. Motivation process shows motivation as a state of need-induced tension that drives an individual to engage in behaviour that he or she expects will gratify a need and thus reduce the tension. Whether gratification is actually achieved depends on the course of action being pursued.

The specific courses of action that consumers pursue, and their specific goals, are selected on the basis of their thinking processes (cognition) and previous learning (experiences). OTWC using motivation theory approach to attract their customers. Firstly, consumers has an unfulfilled needs. There are 2 types of needs which is innate needs and acquired needs. Innate needs are physiological needs that are considered primary needs or motives. Innate needs include the needs for food, water, air, clothing, shelter, and sex.

Innate needs are considered primary needs or motives because they are needed to sustain biological life. Acquired needs are needs that we learned in response to our culture or environment. Acquired needs may include the need for self-esteem, prestige, affection, power, and learning. Acquired needs are generally psychological, they are considered secondary needs or motives. Psychological needs arise from the need for recognition, esteem and belonging. A need becomes a motive when it is aroused to a sufficient level of intensity. This can be relate to how motivation lead consumers to visit OTWC.

Firstly, consumers are hungry, they need foods to feed, so there is an unfulfilled needs. Once a need has been activated, a state of tenstion exists that drives the consumer to attempt to reduce or eliminate the tension. The need of foods will drive the customer to reduce the tension. Drive is the degree of arousal . A basic need can be satisfied in any number of ways , and the specific path a person chooses is influenced both by the unique set of experiences and by the values instilled by the culture in which the person has been raised .

Drive theory focuses on biological needs that produce unpleasant states of arousal . We are motivated to reduce the tension caused by this arousal . Researches have proposed tension reduction as a basic mechanism governing human behavior . As consumers feel tension for hungry, need for foods, it will drive consumers to search for foods to fill their hunger. So consumers will recall back by their experiences about which restaurant has many choice of foods and cheaper. In this process, the choice that made by consumers are also influenced by their own personality, perception, and attitude.

Consumers also learned from something they had tried before, for example, they had learned from the past experiences from OTWC foods and drinks(coffee). As consumers choose among the choices and based on their past experiences, they found that OTWC is the best choice because it is cheap and many option of foods. Behavior refers to the actions and mannerisms made by organisms , system or artificial entities in conjunction with their environment ,which includes the other systems or organisms around as well as the physical environment .

It is the response of the system or organism to various stimuli or inputs , whether internal or external conscious or subconscious , overt or covert and voluntary or involuntary . After consumers has chosen which restaurant or cafe they think is the best choice, they will go visit that restaurant or cafe. Consumers think that OTWC is the best choice based on their past experience and perception, so consumers will go OTWC to eat. Next step of motivation process is goal or need fulfillment . There have two goal , that is generic goals and product-specific goals .

Generic goals are general categories of goals that consumers see as a ways to fulfill their needs . Products-specific goals are specifically branded products or services that consumers select as their goals . Consumer select their individual goals depend on their personal experiences , physical capacity , prevailing cultural norms and values and the goal’s accessibility in the physical and social environment . Consumers will go select OTWC for their meal or tea time maybe is based on their past experience .

If the OTWC food and coffee is nice and the price are fulfill the consumers need , then they will visit OTWC again . If OTWC satify consumers needs and goals , consumers will always visit it and when they think about white coffee they will first think about OTWC . Marketing strategy OTWC no delivery service , so if they have delivery service they will more attract and motivate more consumer to visit or purchase the OTWC food and coffee . It is because many consumer are not free to come out for their lunch and the tea time .

So if OTWC have delivery service consumer will more easy and convenience . OTWC need to make sure the delivery time are in the short time , like not more then 30 minutes for the delivery time . Besides that , they also need to make sure the food and coffee are fresh and warm . If the delivery service are success more consumers will look forward to OTWC . Besides that, OTWC also can do new promotion. Since OTWC only has limited promotion, they should do more promotion on it. OTWC currently only offers the promotion with specific meal and drinks together at a low price.

OTWC can do a new promotion to their customers, which customers can get random combination set of meal and drinks at a low price. By doing this will helps attract and motivate more customers to come to OTWC because it is cheap and flexible. Cross cultural consumer behaviour Cross cultural consumer behaviour is the examination of psychological, social, and cultural factors, we have regularly pointed out how segments of consumer from a particular country or culture are in certain way different in terms of their consumer attitudes and behaviour.

To succeed the international market, we must understand the nature and extent of difference between the consumer of different society-“cross cultural”-so that we can determine whether we can use a similar marketing strategy across different countries, or develop somewhat different or even rather unique and differentiated marketing strategies for specific foreign markets. Potential invest in India The probability of Old Town White Coffee successfully introducing its coffee bar culture in India is relatively high for many reasons. Firstly, India has a huge amount of population.

India, which is the seventh-largest country in the world and the second-most populous country with over 1. 18 billion people (around 17. 31% of the world’s population). India is also expected to have population more than 1. 6 billion by 2030 and might surpass the population of China (U. S. Department of State, 2010). The following is a proposal to open new locations of OTWC in India: – (1) Mumbai: 13,900,000 people and (2) New Delhi: 12,100,000 people (City Mayors Statistics, 2010). These two locations were strategically picked to ensure success of the business venture and will serve as test locations.

If the new stores are highly profitable, OTWC can expand to more than 200 locations in India. Secondly, there is a new consumer culture emerging in India. Today, India’s young are becoming world-class consumers. They have increasingly wealthy and are willing to spend on everything. These changes can be attributed by many factors such as the Indian economy went through a massive liberalization under the new minority government of P. V. Narasimha Rao in1991. The revolution had opened the India’s economy to foreign investment and trade.

The new policies has dismantled important controls, lowered customs duties, devalued the currency, abolished licensing controls on private investment, dropped tax rates, and broke public sector monopolies (Schuman, 2003). This is the good news for both foreign and local entrepreneurs. For examples, Multinational companies such as Citibank, McDonald’s and Motorola have been taking advantage of these new policies and finding a new home in India. These companies owe their success to the rising young elite due to the mass outsourcing by foreign companies.

According to Thottam (2003) in the Time Magazine entitled “Where The Good Jobs are Going,” writes, U. S. companies are expected to send 3. 3 million jobs overseas in the next 12 years, primarily to India according to a study by Forrester Research.? Increasingly in job opportunities enables Indian consumers to reinvest in the Indian economy. Time Magazine journalist, Michael Schumann, asserts that with the changing Indian economy, Indian attitudes towards money are also changing. The Indian consumers today, inspired by job opportunities, have switched to spend more compare to previous.

With the money, they are willing to pay anything and everything. They even want to do what the rest of the world is doing, includes getting fast food in McDonalds, wearing Levis Jeans, and etc, but what’s more is that they are willing to pay. For it, Indian consumers will definitely welcome the internationally popular OTWC to its country. The two proposed locations for OTWC shop are strategically picked because both Mumbai and New Dehli are home to many call centers where these younger spenders work. Besides, many colleges and Universities are also located here which will allow OTWC to target the young generations.

Furthermore, these two cities are also major hot spots for tourists, who recognize a multinational brand such as OTWC. Of course, the OTWC menu in India must cater to the Indian taste, mixing traditional menu items with those that a customized for the Indian tastes Religions India is one of the most religiously diverse nations in the world, with some of the most deeply religious societies and cultures. In India, religion still plays a central and definitive role in the life of many of its people. There are 80% of the people in India are Hinduism. Islam is practiced by around 13%.

Sikhism, Jainism, and Buddhism are influential not only in India but across the world. Christianity, Zoroastrianism, Judaism and the Bahai Faith are also influential but their numbers are smaller. The traditional of Indian culture is defined by relatively strict social hierarchy. Children from an early age are reminded of their roles and places in society. This is reinforced by the fact that many believe gods and spirits have an integral and functional role in determining their life. However, a far more powerful division is the traditional Hindu bifurcation into non- polluting and polluting occupations.

Strict social taboos have governed these groups for thousands of years. In recent years, particularly in cities, some of these lines have blurred or even disappeared. In rural areas, it is common that three or four generations of the family live under the same roof. The patriarch often resolves family issues. Marketing Strategy Product strategy(Standardization) Product mean the goods and service or idea with tangible or intangible attributes combination the company offers to the target market that create value for a buyer or user. Kotler & Armstrong, 2010). According to Kotler (2010), the product is a centre focus of the marketing mix. If it fail to satisfy the needs of consumer, no amount of promotion, price cutting or distribution will persuade people to buy. OTWC India will customize their menu to meet the tastes of their new target market. This includes the addition of more tea items taking in accordance that Indians are known to be more a ‘tea-drinking? population, as well as adding some new flavors in their coffee selection.

OTWC will sell a variety of coffee and tea beverages along with different types of snacks such as pastry, confection, and baked goods, coffee-related accessories, and etc. A new menu will be formulated after several months of research and development. There are some common tastes and preferences of the Indians are known already. For example, Indians tend to take more cream in their coffee. Also, the skim milk option will not be offered in India because dieting is not a commonly accepted practice in the country. Indians will feel that they are being cheated out of their money if skim milk is put in their beverages.

Some of the facilities should also be provided. For examples, the wireless internet is necessary important and must be provided in each stores, so that customers can bring their laptop to continue their work or might spend more time in the stores. The environment of OTWC shop should not be neglected too because the design of the shop will provide customers with a pleasant place to come and relax, study, work, or have business meetings. Besides that, Indians also like spices in their tea and coffee, especially ginger and black clove. One of India’s favorite fruit flavors in mango, and in fact the mango is India’s national fruit.

Packaging is also needed to take into consideration because it helps to attract customers. For packaging in India, green, yellow and brown will be chosen as the product packaging colour because all those colours reflect the distinctive and rich culture and colourful spirit of the people of India. For branding, the brand logo in India will be remained as same as in Malaysia outlet. The raw material such as coffee beans and tea will be bought from local Indian farmers in order to support the local agricultural economy, save money in transportation and tariffs, and gain tax benefits.

Of course, an inspection of the crops is very important in which this process will ensure that the high quality coffee beans to be selected and used in the daily operation and further generate better brand image. These coffee beans will then be transported to the OTWC roasting plant located near the New Dehli location and then transported to Mumbai through avast and efficient railway system. The equipment and other necessary supplies will be shipped from Malaysia keeping in mind there is a tariff on all these items. The inventory policy is to keep the stores stocked but not overstocked to ensure freshness of products.

Thus, better gauges of the numerical figures in the inventory policies should be made after observing consumer trends. Distribution Strategy (Place-Localization) Place includes company activities that make the product available to target consumers. According to Kotler (2010), the distribution decisions are often interdependent with the other marketing mix variable. An organisation distribution strategy is determined by two major factors, including coverage and control. This mean that the coverage of the selling areas must be largest enough in term of population, demand or purchasing power of customers.

Both proposed locations of OTWC shops will be at the highly urban locations in Mumbai and New Delhi because the purchasing power of Indian consumers in urban areas is relatively higher than rural areas (Knowledge Wharton, 2007). Besides, both locations are home to many call center locations, technology companies, major tourist hot spots, colleges and universities, and shopping centers. The OTWC in Mumbai will be located at Nariman Point near Church gate and Gateway to India, which is a major tourist spot. In close proximity to Nariman Point are many technology companies and call centers.

Nariman Point and the nearby area of Colaba are home to the higher-class affluent society. The Architecture around the area is very modern and developed. The roads are in good condition to maintain easy access to the location. The OTWC in New Delhi will be located in Connaught Place, which is a large commercial shopping area in New Dehli. Most of the call centers and big companies are also in the Connaught Circle. New Dehli is the nearest big city to the world famous Taj Mahal, therefore also being the popular place for tourists from all over the world. The OTWC Zone Office will be located in this OTWC store.