In 1921, Reuben Mattus invented a type of ice cream made of pure natural materials and formally named it Haagen-Dazs in 1961 when brought the product to the American market. In 1983, Haagen-Dazs made its first attempt to enter the Singapore and Hong Kong market after having successfully spread its product all over the world. Now over 40 years old, Haagen-Dazs has over 700 brand shops and tens of thousands of retail stores in 55 countries. The brand has been coined the Rolls Royce of Ice Creams because of its quality and price. In China, the price of Haagen-Dazs ice cream is about 5 to 10 times of common types. Despite its price tag, it remains very popular in China.
Haagen-Dazs: Key to Success
There are six factors that contribute to Haagen-Dazs’s success in entering the Chinese market. First is its special brand positioning. It encourages people to chase the comfort and leisure of life by self-indulging. Second, it sets specially high standards for its own products. It uses only quality ingredients and ensures that the end product is the best it could produce. Third, it pays special attention to its marketing strategy. Unlike some luxury brands that use a lot of time and money to promote their products, Haagen-Dazs hardly issues advertisements. It pays more attention to building up brand image by word of mouth among existing and potential customers. In its advertisements, it appeals to couples by incorporating an element of romance. Fourth, Haagen-Dazs maintains very high standards for its shops. It places all of its shops in the downtown area of cities. One of its shops in Xi’an(西安) lies between the bell tower(钟楼) and the drum tower (鼓楼): two attractive tourist sites. Now it has become the symbol of a developed city. Fifth, it caters to consumers’ special needs. For example, it occasionally conducts consumer surveys and listens to opinions and suggestions. Last, the company adjusts its products to Chinese tastes. For example, it made ice cream mooncakes for the Mid-Autumn Festival and it names its products in Chinese. This fusion of its products and Chinese domestic culture makes it more popular.
Haagen-Dazs: a brief SWOT analysis
Strength: It has a clear market position, and high-end consumers are loyal. The brand is famous and influential, and its special marketing strategy and cheap but is effective.
Weakness: Due to the high operating costs, the prices of Haagen-Dazs products are also high, which may drive common consumers away. Also its operating costs remain high throughout the year even though its profits are seasonal.
Opportunities: China’s economy is still rising, and people are becoming richer. So consumption of Haagen-Dazs may also increase. Also, foreign brands have more space to develop since China joined the WTO.
Threats: Chinese consumers are becoming more and more concerned with their physical health, so Haagen-Dazs’ products, which are high in calories and not very nutritional, may not fit into this Chinese health craze. Also, other international giants are also exploring China market, which may eat into the company’s market share.
Picture Source: Haagen Dazs China