Question

Using Caribou Coffee as my case study, how would I answer the following questions?

• How the target market changed over time
• Whether you think the marketing manager should make changes to the products he/she offers
• Recommendations you might make to the marketing manager
• How the marketing manager might be more certain that any actions he/she takes will more completely address the needs of the target consumer group
• The risk(s), if any, that are involved with implementing your suggestion(s)

Answer 1

Caribou coffee specializes in retail of teas, coffee bakery goods and other related products. It focuses on commercial, retail and franchise businesses. Retail segment comprise of about 400 of the total coffee establishment and focuses on the local market. These key stores are based in Minnesota and over 20 other store in major states. Commercial segment focuses on mass merchandisers while the franchise business which comprises of about 19% of the total coffee houses targets the international market. The firm supplies its products to diverse clientele groups such as grocery stores, hotels, airlines, mass merchandisers, entertainment venues, offices and colleges among other clients. While initially it supplied coffee to retail consumers, it has made the switch to providing coffee as a luxury item, as can be seen by their new "lodge" like stores. Caribou management main goal is directed towards providing high quality coffee blends and other related products to its clients.

(a) How has the target market changed over time?

Initially, adults were associated with Coffee drinking until the recent witnessed shifts in the consumer behaviors brought about by the Generation X and Y.

(b) Should the manager make changes to the product line? And recommendations to the manager?

The changes associated with these generations should mean that Caribou redesigns its product line in order to attract a growing number of young adults who have indicated interest in the firm’s coffee products. For example, Caribou resulted in single-serving system in mid 2000 in order to ensure that target consumer are able to access superior coffee at designated pods in hotels, entertainment venues or even in major stores in Minnesota. Baby boomers who normally switch to healthier coffee products forced Caribou to introduce decaffeinated coffee in the stores. This transition was enabled by the firm’s aided technological processes which usually improves decaffeinated coffee flavors to suit the various generations’ considerations.Similarly, changing the product line slightly to inculcate the shift in generations is natural and can only lead to greater profits.

(c) Risks associated with implementing suggestions?

Might become too generic, losing its specialisation. It is essential to carve out a niche, but creating a very specific image in consumer's minds reduces the target market. Coffee products offered by other players such as Proctor & Gamble or even Starbucks Corporation at a competing price offer a threat to CBOU.O specialty coffee products, thus making it hard for the firm to raise prices for profitability reasons. Health concerns have influenced the consumption levels of specialty coffee as a substitute to other highly priced soft beverages. For example, Starbuck’s Power Frappuccino has been a big threat to Caribou’s due to its price espresso-based beverages.