James Robie Art Gallery Visit Assignment Essay Example | Topics and Well Written Essays - 500 words

James Robie Art Gallery Visit Assignment - Essay Example The arms are silver in color and are half circles. He shows the head as a half circle. the body stands on a wood base of dark wood. The "Conjurer" is strong and powerful because the whole body is visible to the viewer. You really don't have to use your imagination to see the body. Why the name "the Conjurer"? He is a strong wizard. His art is old and his feats are to change the fate of those who ask. The half head shows the size of the moon. A wizard or conjurer practices his art at night. The "Shrine" represent a couple under the umbrella of unity. It is a kind feeling as the man and wife are united into one. There is a mixture of modern as seen with the top and of native culture. It could be African or it could be from the depths of South America. The soft light wood with the oxidized green shows life which has become united in time and aged with experience. It is interesting to note that though there are angles in this statute, the majority of the statue is a solid piece of wood. The couple is facing each other. Normally Robie uses different pieces and forms in his statutes. In the "Conjurer", he used a vibrate wide spread silver showing the magic. Perhaps this is why we see him as moving his arms We see the "Shrine" as a still peaceful moment of a couple looking out. Each of Robie's statutes show different angles of the person both physically and spiritually.

Aesthetic Attitude Is A Myth Philosophy Essay

Aesthetic Attitude Is A Myth Philosophy Essay In The Myth of the Aesthetic Attitude, George Dickie argues that the notion of the aesthetic attitude is a myth and attempts to argue against all forms of the idea. Whilst there are other compelling theories concerning the existence of the aesthetic attitude, he presents a strong case against it, arguing that all attempts to precisely describe such an attitude fail. His argument focuses on the notions of the aesthetic attitude proposed by Bullough and Stolnitz, which I will outline in this essay. Initially, Dickie considers Edward Bulloughs theory of psychical distance. Bullough suggests that in order to obtain an aesthetic attitude and judge an object aesthetically, the subject must distance themselves from that object and separate à ¢Ã¢â€š ¬Ã‚ ¦the object and its appeal from ones own self, by putting it out of gear with practical needs and ends.  [1]  In doing so, Bullough says that contemplation of the object becomes alone possible  [2]  and you are no longer directly involved with the object. Bullough illustrates his idea using his fog at sea example, where he describes how unpleasant and dangerous the fog might seem to a person, but also how beautiful the fog is. Bullough thinks that it is the aesthetic attitude which enables ones view of the fog to change through a transformation by distance  [3]  as the fog is allowed to stand outside the context of our personal needs and ends and one can look at it objectively. For Bullough, only the right amount of distance enables the aesthetic attitude to be employed and he discusses à ¢Ã¢â€š ¬Ã‚ ¦cases in which people are unable to bring off an act of distancing or are incapable of being induced into a state of being distanced.  [4]  Bulloughs example of à ¢Ã¢â€š ¬Ã‚ ¦the jealous husband at a performance of Othello  [5]  unable to concentrate as he is thinking of his own wifes suspicious behaviour demonstrates being under-distanced as the subject is too emotionally involved with the play. Similarly, a light technician working on the play might be over-distanced as he is preoccupied with the lights and missing any emotional involvement with the play itself. Dickie may undermine Bulloughs concept of distance here as he questions whether one can deliberately distance oneself or whether one can be induced into a à ¢Ã¢â€š ¬Ã‚ ¦consciousness denoted by being distanced.  [6]  Dickie undermines the concept of distance here suggesting that there is no such experience as being distanced and so undermines Bulloughs theory. Furthermore, Dickie criticises Bulloughs use of new terms referring to distance, as he thinks to introduce these terms does nothing but send us chasing after phantom acts and states of consciousness.  [7]  Dickie infers that there is no identifiable psychological experience of being distanced  [8]  and so no value in Bulloughs idea of distance. Furthermore he suggests that being under or over-distanced is simply being more or less focused on something and just two different cases of inattention.  [9]  Therefore, being distanced means just focusing ones attention on something and is not a new kind of act  [10]  or special state of consciousness  [11]  . Whilst Dickie puts forward a fairly persuasive argument against psychical distance, his description of aesthetic experiences as simple cases of attention or inattention may not be adequate in explaining what it truly is to have an aesthetic experience. If, as Dickie suggests, we reject the aesthetic attitude, one might argue that we would be unable to answer some important questions about aesthetic experience. Specifically, one might argue that the aesthetic attitude is required in order to pinpoint what exactly the judgment of taste is and what prompts us to recognise objects as aesthetic objects. Therefore, Dickies argument may be less effective in refuting the aesthetic attitude, as Bulloughs theory of distance may be closer to providing answers to such questions. Importantly, Dickie continues his argument by criticising another way of conceiving the aesthetic attitude when he discusses Jerome Stolnitzs theory which suggests that the aesthetic attitude is à ¢Ã¢â€š ¬Ã‚ ¦marked out by its disinterestednessà ¢Ã¢â€š ¬Ã‚ ¦Ã‚  [12]  and its detachment from practical purposes. Stolnitzs definition is that it is the disinterested and sympathetic attention to and contemplation of any object of awareness whatever, for its own sake alone.  [13]  Stolnitz elaborates on this idea explaining that disinterested attention means looking at the object with no concern for any ulterior purpose.  [14]  Similarly he says that sympathetic attention means that the subject can experience the objects individual qualities with no prejudice. For Stolnitz, such an aesthetic perception involves the subjects active attention being directed at the object alone, without thinking or asking questions and being emotionally open and able to respond to it. This result s in an enhanced experience of the object which enables us to focus on à ¢Ã¢â€š ¬Ã‚ ¦the look of the rocks, the sound of the ocean, the colours in the painting,  [15]  whilst contemplating an object with a practical perception prevents us from truly appreciating it and limits our experience of the object. Dickies criticism of Stolnitzs aesthetic attitude only really focuses on this notion of disinterested attention. Stolnitz distinguishes between disinterested attention and interested attention which he says differ according to the purpose of the attention. For example when looking at Warhols Campbell Soup Cans, if I admire it as a beautiful piece of art then I experience it with disinterested attention. On the other hand, if I look at it and think about how hungry I am and how I would like to eat the soup, I experience it with an interested attention. However, Dickie objects to Stolnitzs idea that such a difference in purpose results in a difference in attention. Dickie proposes that the concept of disinterest does nothing to explain what it means to attend to  [16]  an object. To reinforce his point, Dickie uses an example of two people listening to music with different purposes Jones with the purpose of analysing the music for an exam and Smith with no such purpose other than simply listening to it. Dickie suggests that Jones has an ulterior purpose and Smith does not, but this does not mean Joness listening differs from Smiths.  [17]  Dickie demonstrates that the only difference between the listening of Jones and Smith is their purpose and suggests that in reality there is nothing different about their attention at all. Therefore, Dickie argues that the notion of disinterestedness cannot be used to refer to a type of attention, as attention has no special attribute such as disinterest. Instead, Dickie thinks that it ca n only refer to whether attention is motivated by a purpose or not. Hence, Dickie may challenge Stolnitzs theory as he questions the validity of the concepts of interested and disinterested attention which is key to Stolnitzs whole theory of the aesthetic attitude. In addition, Dickie reinforces his argument using the example of the art critic attending a piece of art. Dickie points out that according to Stolnitzs theory, the art critic could not critique the art as well as appreciate it, as the critic has an ulterior purpose to analyse and evaluate the object he perceives.  [18]  Dickie claims that Stolnitz confuses a perceptual distinction with a motivational one  [19]  as the critic only differs from other subjects attending the art in his motives and purpose. For Dickie, this example only further highlights that it is not possible to attend to art interestedly nor disinterestedly only with or without a motive or purpose. Whilst Dickie develops a convincing argument against Stolnitzs theory of the aesthetic attitude, he does only really focus on one aspect of it disinterestedness and doesnt effectively address the idea of sympathetic attention, for example. In his argument, Stolnitz stresses the importance of considering all the aspects of his definition of the aesthetic attitude, so for this reason, Dickies attempt at challenging Stolnitzs theory may not be as successful. Furthermore, Stolnitz himself argues in response to Dickies criticism that, Leading aestheticians continue to take disinterestedness to be foundational in their thinking.  [20]  Stolnitz suggests that the incomparable longevity of the concept demonstrates its validity, as it continues to engage thought.  [21]  As engaging as the concept may be, however, this point might not succeed as an effective counter-argument to Dickie. Dickies argument convincingly refutes Bulloughs and Stolnitzs theories of the aesthetic attitude, but it may not follow that rejecting the ideas of distance and disinterestedness means that no special aesthetic attitude exists. One might argue that from the vantage point  [22]  of the subject there are a set of features that identify aesthetic experience  [23]  which, whilst difficult to describe accurately, constitute the aesthetic attitude. Furthermore, it might be argued that Dickie is more concerned with the aesthetic object than the aesthetic experience, as his own alternative for the aesthetic attitude the institutional theory of art focuses on the nature of art and how an object can become art, rather than on aesthetic experience and our response to an object. Ultimately, however, whilst there are several compelling counter-arguments in favour of the aesthetic attitude, I think that Dickies argument that it is a myth is convincing and effectively undermines both Bull oughs and Stolnitzs notions of the aesthetic attitude.

The play A Memory of Lizzie is a fictional look at the childhood years

The play â€Å"A Memory of Lizzie† is a fictional look at the childhood years of the infamous murderess Lizzie Bordon The Memory of Lizzie Bordon The play â€Å"A Memory of Lizzie† is a fictional look at the childhood years of the infamous murderess Lizzie Bordon. Set in America the late eighteen hundreds, the play takes place in an average middle class neighbourhood in Massachusetts at that time. The play takes place in an average suburban school, and the characters are (or at least the children of) moderately wealthy people. The Characters in the play are the childhood acquaintances of Lizzie Bordon, each aged around twelve years old, though due the era they would probably be less mature than modern day twelve year olds. Each character has a different attitude towards Lizzie which becomes apparent as the play continues. The children Ann Dorothy Barbara Irma Jo and Kathy all bully Lizzie, while Christy and Georgina pity her. The character Rachel Brayton is a very quiet character, possibly younger than the other children present in the scene and therefore more fearful towards Lizzie. The set in the scene that we performed consisted of some steps to represent the schools steps and a pair of curtains to represent doors. The scene starts with the children frozen, some playing with a ball, others with cards and three with a skipping rope. The only other prop that we needed was the doll that Rachel Brayton played with. Costumes would include schools uniforms, gr...

Cafe Nero Marketing Plan

[pic]vvv v Contents Introduction†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Page 3 Overview†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Page 4 Marketing Audit†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. Page 5 PEST Analysis†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Page 5 Market Analysis†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â ‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. Page 8 Micro Environment †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Page 10 Internal Analysis†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. Page 12 SWOT Analysis.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Page 13 Assumptions†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. â € ¦.. Page 14 Marketing Objectives†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Page 15 Strategy Choices†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ Page 16 Marketing Strategies†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. Page 17 Places†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. Page 17 Products†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã ¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. Page 18 Prices†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. Page 18 Promotion†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦.. Page 19 Control & Evaluation†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Page 20 Expansion †¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚ ¬ ¦. Page 20 Success of new products and targeting operations†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Page 20 Brand awareness†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. Page 21 Introduction to International Expansion†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Page 22 Which Country†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. Page 22 How to Enter†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. Page 23 What Marketing Strategies†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. Page 23 References & Bibliography.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Ã¢â‚¬ ¦. Page 24 Appendixes†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. †¦Page 25 Introduction This marketing plan analyses the key success factors of the company and our current market position in order to set the next market objectives and plans a one year plan strategy to reach those objectives. In the second part, this marketing plan outlines the issues that need to be considered to implement Caffe Nero overseas by analysing of international marketing of the company. Caffe Nero Group Plc Caffe Nero Group Plc was founded 1977 and currently owns 290 stores from Brighton to Glasgow with ? 0,7 million as turnover. We provide Italian coffee in European style coffee houses. Our philosophy consists on serving the best quality coffees and food in a friendly way in a pleasant atmosphere. Corporate Objectives †¢ Increase our market share in UK in order to be the leader. †¢ Starting international expansion in the Western Europe 1. Overview 1. 1 Market segmentation The coffee shop market in UK is estimated at ? 540 million in 2006 and had increased by 109% between 1999 and 2004 (Mintel, 2005). This market has emerged in 1990. It is dominated by single-site and independent coffee stores which account for 35% in terms of outlets numbers. However, branded coffee shop companies have grown significantly. In 2004, the top four branded coffee shops, which include Starbucks, Costa, Caffe Nero and Puccino’s, accounted for 23% of the whole market and were expected to keep expanding (Mintel, 2005) (Figure 1). Caffe Nero Group Plc is the last entrance between the top fives competitors in the UK coffee shop’s market. We currently own 290 stores with a turnover of ? 90,7 million. This is due to an aggressive expansion strategy that we have conducted from 1999. Indeed, we were ranked 20th on the annual listing that gather rapidly growing European companies in the 2004 and 2005 Europe's 500. Figure 2 shows how the market shares were split between the top five competitors in 2004. 2. Marketing Audit This section shows external and internal factors that characterize the coffee shop market. It is essential to determine them in order to have a better understanding of the market characteristics. 2. 1 PEST Analysis Political & Legal Environment Fair trade coffee is becoming an important issue in UK since Starbuck introduced it in 2002. It appeared first in 2000 in the US where activists pressured Starbuck to carry fair-trade coffee in their outlets. Mintel found that 25% of adults who have been to coffee shop agreed that more coffee shop should sell Fairtrade products (Mintel, 2005). This is certainly a significant figure that coffee shop and other outlets selling coffee cannot afford to ignore. The smoking-ban in the UK will be enforced in summer 2007. This means that smoking will be prohibited in all pubs, clubs, restaurants, coffee shops and other public places. This may have both positive and negative impact on the coffee shop market. As happened in Ireland and Scotland where the ban has already been adopted for several years, people are likely to eat more in coffee shop since they will be no longer bothered by smoke when eating. However, coffee shops that do not provide an outside smoking area are likely to observe a decline of their visiting as smokers enjoy having cigarettes when drinking coffees. Economic Environment There are signs that boom in the UK coffee shop market is over. Store opening has declined from 2002 (Figure 3) as well as year-on-year growth that has declined from the peak of 23% in 2001 to 9% in 2005 (Figure 4) (Bremner C, Euromonitor international, 2005). Social Environment UK population is about 60. 2 million with 48 million people living in urban area, where coffee shops tend to be concentrated. Mintel carried out a survey that reveals that the most typical user is in the 25-34 brackets (Mintel, 2005). More precisely, the 20-24 age groups and the wealthy achievers category are the biggest clientele of branded coffee shops. They are forecast to continue rising until 2009 according to UK National Statistics (UK National Statistics, 2006). As mentioned above, coffee shop market seems to approach the maturity. Thus, coffee shop companies focus more on how increase spends by head. Thereby, the rise of Personal Disposal Income (PDI) has become an important factor for companies. In fact, the coffee shop market has taken advantage of the PDI that has been rising since 1999. This should continue until 2009 at least, since PDI is set for similar growth (Mintel, 2005). Allegra’s survey, based on 7500 coffee shoppers’, sample points out that the most important reason for visiting coffee shop is to relax and to meet friends and colleagues (Allegra Strategies, 2006). Mintel’s survey makes clear that there is no gender bias in coffee shop consumers which is of such importance for the outlets since this makes coffee shops places ideal for couple as well as suitable venues for single men and women to socialise in mixed company (Mintel, 2005). According to Allegra’s survey, coffee bar loyalty is increasing, with significantly more than half of consumers surveyed in 2005 mentioning that they mainly visit their favourite coffee shop (Allegra Strategies, 2006). However, this survey shows that â€Å"convenience of location† is the most important reason consumers select a given coffee shop. Thus, the number of outlets is a critical element. Coffee suffers from its image as it contains caffeine which can produce coffee addiction. This may lead people to fear the caffeine dependency. Therefore, Starbuck has communicated that coffee has high level of antioxidants which have been shown to help prevent cancer, heart disease and other conditions. Technological Environment There is a general direction to transform outlets into media and community area centre. Thus, coffee shops develop Wireless Internet Hotspot and coffee book store. For instance Starbuck, has developed high-speed wireless Internet access through a deal with T-Mobile. Besides, Costa and Starbuck have developed electronic card that allows customers to get points when purchasing coffee shops’ products. Customers can use those points to get free products and use this as debit card. 2. Market Analysis Market Shares There is an intense competition between the top three companies. The following picture shows the market shares of the three main competitors by the number of outlets. [pic] Market Trends There is a general trend for branded coffee shops to increase spends by head. This required to create interest and stimulate demand by introducing new drinks and patenting them or wider selection of gourmet food. Thus, a general strategic trend for the top four coffee shop companies consists to emphasize on developing new products and pushing larger cup size. Food has become essential for them since it really helps to increase spend by head and allow to infringe on the fast-food market as well. Therefore, coffee shops have added into their menu hot and cold meals such as pizzas, paninis, salads, sandwiches, etc. Even though the market is approaching maturity, there are still high consumer demands and opportunities identified in the UK, according to Allegra (Allegra Strategies, 2006). Thus, the top five companies emphasize on keeping on expanding with different methods. They purchase and implant new outlets and have started to move into provincial region. Despite the fact that those provincial stores are less lucrative than stores in city-centre, they offer opportunities, allowing companies to secure higher levels of brand recognition as well as market share. Franchising and licensing have become important keys to growth as well. This allows companies to avoid paying extortionate retail rents and limit their risk. Besides, companies use partnerships with retailers and other consumer services such as banks, bookshops or supermarkets to increase their market share. Both Starbuck and Costa adhere to Fairtrade label and have launched their own Fairtrade coffee certified by the Fairtrade Foundation. We do not serve coffee certified Fairtrade. We adhere to self-imposed guidelines to ensure that growers receive a fair price. Thus, we are not allowed to call our coffees ‘Fairtrade' as that is a commercial trademark. However, we are committed to purchasing coffee beans that meet the International Coffee Organisation’s (ICO) standards. This consists in paying a fair and decent price to farmer as well as to trade only in quality coffee as proposed by the ICO Coffee price does not seem to be a determinant factor. Indeed, Starbuck charges quarter more than most other shops and raises prices in line with shifts in coffee prices, which suggest their consumers are not affected by their pricing (www. morningstar. com). Moreover, despite operator price increase, the market has increased of 9% in the past 18 months. In fact, since coffee is more of a luxury product than a necessity, it is a kind of price inelastic product to some degrees (not exceeded ? ,5). 3. Micro Environment Consumers Analysis The survey carried out by Mintel specified that customer of Caffe Nero are slightly younger than other coffee shops. Indeed, 60% of Caffe Nero’s customers are under 34 years old. Furthermore, UK National Statistics forecast that the 20-24 age group, which is our biggest clientele, is going to increase (UK National Statistic , 2006). (For more detail, see appendix 1) According to Mintel’s findings, our customers are more likely to flit between brands than Starbuck or Costa’s customer (Mintel, 2005). We do not believe that our clientele is disloyal. This is explained by the fact that we have less outlets than Starbuck or Costa and so their clientele does not need to flit between brands as they find their favourite branded coffee shops everywhere. Competitors Analysis Starbucks Corporation Created in 1971 in Seattle, Starbuck is the world’s largest coffee shop company and the UK leader since 2002. Starbuck has currently 10 000 stores across the globe and 532 in UK. Its brand awareness is high despite increasing criticism from the anti-globalisation lobby. Generating $7. 8 billion as revenue in 2005, Starbucks has a real important investment capacity. Costa Coffee Ltd Founded in 1978 and acquired in 1995 by Whitbread Group, Costa Coffee used to be the largest coffee shop in UK before Starbucks came. Costa Coffee owns 500 stores across UK and has started international expansion in the Middle East, in India and in Cyprus. As Costa is part of the Whitbread which owns hotels, restaurants and many other businesses, it has an important investment capacity. Puccino’s Puccino’s is a private company created in 1996. It has about 110 stores but does not own them, as the outlets are franchised. Thus, Puccino’s does not have a real power. Its turnover is about ? 0 million. Coffee Republic Coffee Republic was created in 1995. It became one of the largest independent espresso bar brands of the UK. However, since 2003, Coffee Republic has started to reduce the number of its stores as is currently in the midst of converting its portfolio to the Republic Deli concept. Therefore, Coffee Republic’s turnover has more than halved and we can consider that it is not a competitor anymore. Channel Analysis The coffee shop market has the advantage of having a huge number of suppliers who are actually farmers. Thus, the bargain power of those suppliers is very low. However, several organisations such as the International Coffee Organisation denounce the abuse of coffee shop brands’ power. The retailers are either franchisees or stores that the coffee shops companies own. 2. 4 Internal Analysis Cafe Nero has been ranked first by British coffee drinkers in the last six years. According to the consumer research organization, Allegra, the 2005 poll put Cafe Nero first, Costa second, and Starbucks third in terms of coffee quality, atmosphere, service quality and price value (Allegra Consumer Report 2005 – Major Coffee Brands). Our emphasis on the quality of our products and services are gainful and gives us a good corporate image. We support an image of Italian coffee bar which is reflected through our Italian and Mediterranean deli-style meals. This has allowed us to be rated as â€Å"The best espresso this side of Milan† by Tatler and labelled â€Å"The traditional Italian cafe† by Egon Ronay We have tried to create a range of natural, fresh foods, avoiding all additives, artificial flavours and colorants. Our menu consists of Italian and Mediterranean food. Most ingredients we used are imported from Italy For more detail about where we are in term of offers and services, we have analysed our position and strategy with the 4P analysis in appendix 2. 3. SWOT Analysis Strengths †¢ Products and services quality (coffee and food), seen as the best by customer for 6 years (Allegra Strategies, 2005) †¢ Our image of Continental and Italian style and atmosphere supported by sponsoring art events. Weakness †¢ Not enough number of outlets. Our clientele has to flit between brands †¢ 60% of our existing clientele is under 34 years old †¢ We cannot call our coffee Fairtrade even if we follow the fair-trade philosophy as Fairtrade is a trademark. Opportunities †¢ Expand our clientele in targeting people older than 34 years old †¢ Opening new outlets in three ways: o Continue to acquire new stores o Continue to develop new partnerships with mega stores o Develop franchise †¢ Develop in smaller cities †¢ Develop new products †¢ Make available Wireless Internet Hotspot and books into all our stores †¢ Coffee’s virtue : high level of antioxidant Threats †¢ The Market is approaching the maturity †¢ Fast food selling coffee e. g. Mc Donald, Pret a manger †¢ Adverts showing caffeine effect on health can reduce the sales †¢ The smoking ban may affect on customers’ visiting 4. Assumptions From the marketing audit and with respect to the coffee market’s climate, it is assumed that: †¢ Competitors will carry on their expansion in term of outlets to make sure that their customers will not have difficulties to find their stores, avoiding them to flit between brands. †¢ The market is forecast to reach the maturity in 2009 and so the liability of expansion for coffee shops will be reduced due to the saturation in high street in the UK’s main cities. †¢ Food is becoming an important aspect for the top five competitors since it allows to take market share from fast-food market and generate an important source of income. Thus, coffee shops will have to focus on developing wider range of food to increase their market share. †¢ The smoking ban may affect the coffee shop market. In order to avoid any risk of decline it will be essential to provide outside smoking area. †¢ There is a rise in fair trade coffee demand. Coffee shops that do not emphasize on fair trade coffee will be criticised. 5. Caffe Nero’s Objectives The analyses of the current market as well as the analysts’ forecasts for Caffe Nero have led to the following three years marketing objective. Then, we have extrapolated this long term objective into year objectives. Increase our market share up to 30% between the top three competitors before the market reaches the maturity in 2009 in terms of turnover and outlets. o This means that we will have 600 outlets across UK. o All stores should reach at least ? 350  000 as turnover. †¢ For the year 2007 1) Increase the number of outlets by 38% to reach 400 stores by the end of 2007 (36% in 2006; 32% in 2005; 34% in 2004). 2) Increase our sales by 35% for 2007 (? 129,8 million) compare to 29% realised in 2006 (? 90,7 million). To see our objectives for 2008 and 2009, refer to appendix 3 To see the analysts’ forecasts for Caffe Nero, refer to appendix 4 . Strategy Choices Here, we have developed strategies to achieve our objectives. We also did a planning gap in appendix 5. Ansoff’s product – Market expansion Products/Services ExistingNew | | | |Increase the number of outlets by 38%. |Develop ice-creams. | | | | |Targeting people beyond 34 years old. Parents and not parents) |Develop new soups. | | | | |Equip all our stores with Wi-Fi hotspots. | | | | | |4) Develop outside smoking areas. | | | | |Expand in smaller cities. | | 7. Marketing Strategies To establish strategies that will allow us to achieve our objectives, we have used the 4 p marketing mix. 7. 1 Places Our objective consists in opening 110 new store s. This requires a huge investment. However, there are three different way to expand. First of all, expand in acquiring new outlets. We opened 76 stores last year. This year, we should be able to acquire 85 stores. We need to purchase stores in high street in order to avoid our existing clientele to flit between brands. Another opportunity consists on going in some smaller cities where there is no competitors. However, those cities must have more than 150  000 habitants to be considered. Secondly, we should develop a franchise system to support our expansion. Indeed this system allows us to expand with a small investment. (for more details, refer to appendix 6. 1) Thirdly, we also need to develop more partnership with mega stores since it allows to reduce the price of the coffee shop’s rent. We could develop partnership with Virgin and some others book stores. As response to the smoking ban, we need to develop outside smoking area in most coffee shops we are able to. These areas could attract customers of our competitors if they do not have smoking area. They required heaters as well as outside furniture. Furthermore, we need to equip all our stores with wireless Internet access in order to satisfy and retain our clientele since competitors develop wireless Internet access as well. . 2 Products To increase spend by head we need to develop new products. Our clientele enjoys our soups. Indeed, there are healthy and practical with our take-away packaging. Moreover, they fit well with our image of quality and healthy food. Furthermore, it is still a kind of new product since only Starbuck serve soups as well. Therefore, we should develop mo re soups as we have got only four different soups. 10 different tastes would be enough. We also need to add ice-creams in our menu. This product may attract new customers who will go to our coffee to have a dessert. Indeed, ice-cream match well coffee shop’s spirit in the sense of having a break time with friends or family. Everyone finds something he really likes in our stores (hot or cold drink, salty food or sweetened, frozen, cold or hot food). We will propose some light ice-creams as well. Furthermore, ice-cream may help to attract parents who can go with their kids to get them an ice cream. Finally, to keep our Italian branding way, we will serve only Italian ice-cream and will prepare the cream as Italians do. However the machine required is too big to take place in every store. So we have to find a smaller one. 7. 3 Prices We should keep our prices as they allow our coffee to be perceived as worth (Allegra Strategies, 2006). However, the price for our food is a bit higher as we server only quality food. Thus, our Italian ice-creams and soups will be a bit more expensive than every where else. The cru bourgeois costs more than the table wine! To attract people beyond 34 years, we should consider family as part of potential clients. To do so, we should create a child menu which will include a hot chocolate, some cakes and a toy for a reasonable price. 7. 4 Promotions In order to consolidate our brand awareness, we should advertise on television. Despite of the expensive cost, it is the support which reaches the most people. We need to make people aware of our new products such as ice-cream. This would consolidate our brand awareness. However, we need to develop adverts that fit our sophisticated Italian image. This advert should emphasize on the friendly Italian atmosphere of our stores and the quality of our products. We also should advertise on newspapers such as the guardian or the independent who are more likely to be red by people beyond 34 years old. We must carry on our sponsorship of art events as it matches well with our Italian sophisticated image. To attract parents we should organised children events in our stores as Mc Donald’s is used to do. For example, we can have a Santa Claus for Christmas and some animations for Halloween. However, we need to be aware of the risk of developing family clientele since they may bother our existing clientele. 8. Control and Evaluation This section aims to produce a system of control and evaluation of the proposed marketing plan and its realisation. 1. Expansion We need to open 110 stores, so we can establish that nine stores should open every month at least. The full-term aim is to reach 30% of the branded coffee shops market. So we also need to look at competitors’ expansion. This will be realised every six months as companies produces interim reports. We may need to adapt our expansion strategy according to competitors’ growth to reach 30% of market share in 2009. 2. Success of new products and targeting operations In January we will conduct a survey into all our stores. This survey will include questions about: †¢ Define sample questions (age, sex, married, children, frequency, etc.. . †¢ How much our clientele like our food product (their satisfactions) †¢ What think customers about introducing Italian ice-cream in our menu. †¢ How many Caffe Nero’s adverts they have seen †¢ Use of services (Wi-Fi, smoking area) †¢ What they think of Caffe Nero’s atmosphere The same survey will b e conducted in December. Thus we will be able to compare the results and so determinate the success of our new products. Moreover, this survey will check if we have increased our 35-years-old-and-more clientele. In parallel, we will look every trimester at the ice-creams and soups’ sale volumes. We expect the same success for the Italian ice-cream than we had with soups. 3. Brand awareness Allegra Strategies conducts every year a serious survey on the coffee shop market and the customer’s satisfaction. This constitutes an useful tool for us as we can see the evolution in customer’s mind of our brand awareness and satisfaction concerning our products and services. Introduction to international expansion We are thinking of international expansion. Indeed, since the coffee shop market is approaching the maturity in England, we should develop our company overseas. This could help to reduce the risk for our company if we do a successful international implantation. Starbucks has shown that international expansion is a real opportunity for branded coffee shops in setting up more than 7000 international outlets in 9 years. However, an international expansion implies to decide which market to enter, how to enter in, what marketing strategies need to be used within which organisation. Here, we will answer those questions. Which country? First of all, it is essential to go in a country where the competitiveness is low. Furthermore, the population and their income size must be high, enabling potential customers to devote a large proportion of their discretionary spend on leisure activities. France could be an appropriate place for us. Indeed, it is in the â€Å"triad market† that includes the United States, Western Europe and the Far East which account for a large percentage of all international trade. There are already two branded coffee chains in France (Starbuck and Colombus Cafe) which ensure that there are possibilities for the coffee shop market. They are implanted only in Paris with 18 stores for Colombus Cafe and 26 stores for Starbucks. Colombus Cafe’s philosophy is quiet close from ours. Indeed, they serve Italian coffees in a quiet and relaxing atmosphere and emphasize on the welcoming services. However, those two chains are not implanted in the south cities of France such as Marseille (2nd biggest city, 1,4 million habitants) and Montpellier (0,5 million habitants). Furthermore, according to the French tourism department, 10 % of English people go to the south of France for holydays (Ministere Delegue au Tourisme, 2006). This is an opportunity to increase our brand awareness due to the global mobility of our customers. Therefore, it seems that those cities could be great for success abroad. How to enter? Since we are not the first one to go in France and as the competitiveness is low, we should expand cautiously. Indeed, two approaches can be used when planning an international expansion: †¢ A Waterfall approach, in which a country is gradually entered sequentially †¢ A Sprinkler approach, in which many countries are simultaneously entered within a limited period of time We have better to use a waterfall approach, in opening few stores in order to limit the risk of financial lost if we are not to success. Two ways of opening stores are possible: †¢ Franchising, which allows to gain entry at little risk but limit the profit for the company †¢ Direct investment, which is the most risked but allows the company to retain a full control of its investment. It seems that we should rather purchase few stores since we need to set up distribution and logistics that generate costs to provide those stores with our products. Thus the acquisition of two stores in Marseille and Montpellier could be good to start as it limits the risk. We will be able to see after a year time if those stores are profitable. What marketing strategies? It is essential when planning for success abroad to think how much products and promotions need to be adapted to the local market. Thus we need to focus on cultural differences as well as French’s customs and inspirations. Despite the fact that French are proud of their food and drinks, they believe than Italians are better for some specialities such as pasta and coffee. Indeed, several coffee beans companies in France such as Lavazza, San Marco and Segafredo market their coffee as traditional Italian coffee. Besides, French support a kind of passion for Italy as English people do. However, the coffee was introduced first in France in Marseille. Thus, there is a very famous French roaster company which produces the traditional French south coffee called Henry Blanc. This is an important emblem for French. In order to adapt our strategy to the French market we have used the 4 P marketing mix. Place: Montpellier has a big commercial place in the centre called Place de la Comedie. There is a very famous high street in Marseille which is called Cannebiere. Those places could be great to implant stores since they have big activities. Products: We will be the first coffee shop in the south of France. So we should keep our coffee menu that is likely to seduce French as it would be new for them. This should seduce the young population first who will then bring others. Futhermore, French like Provencal food which is quiet close from Italian one. So our Italian gourmet food should correspond to their expectations. However, we should introduce the traditional French coffee Henry Blanc in order to meet French taste. Furthermore, this will seduce local people as we will support the local economy. Price: French are known to like good quality. According to Emarketing, French associate quality with high price (A. Michalowska, Marketing Magazine, 2002). Besides, the American magazine Travelers has conducted a survey in 2005 which reveals that the average price for coffee in France is 4â‚ ¬ when we sale our espresso in England at ? 1,25 (2,7â‚ ¬) (Le Chiffre du Jour, 2006). Thus, we should keep the same prices of our products. Promotion: We need to advert a lot to generate awareness of our company. First, we will put big adverts on our stores when they will be under construction. Secondly, we will organise a celebration for the opening day. Finally, we will advert on local newspapers such as La Provence and Midi-Libre which covers all the south population. References & Bibliography Allegra Strategies, (2006), Market Overview and Key Statistics: Project Cafe6, [online], London, Available from  : ; http://www. allegra. co. uk/project-cafe6-keyfindings. html; [Accessed 20 December 2006] Bremner C. , (2005), Coffee Shops in the UK, [online], Euromonitor International, Available from  : ; http://www. euromonitor. com/Coffee_Shops_in_the_UK; [Accessed 23 December 2006] Caffe Nero, (2006), Caffe Nero, [online], Available from  : [Accessed 20 December 2006] Kotler P. and Keller K. L. , (2006) Marketing Management, 12th Edition, Upper Saddle River, NJ :  Pearson Prentice Hall Le Ministere Delegue au Toourisme, (2003), Les principales clienteles europeennes de la France, [online], Paris, Available from  : [Accessed 28 December 2006] McDonald, M. , (2006), Marketing Plans, 5th Edition, Oxford :  Butterworth-Heinemann Michalowska, A. , (2002), Qualite : les Francais prets a en payer le prix, [online], Marketing Magazine  N °71, Available from  : [Accessed 27 December 2006] Mintel Reports, (2005), Coffee Shop UK, [online], Available from: [Accessed 3 January 2007] National Statistics, (2006), National Projection, [online], Available from  : [Accessed 22 December 2006] Vacances Pratiques, (2006), Le chiffre du jour  : 8,30â‚ ¬, [online], Available from  : [Accessed 30 December 2006] Appendices [pic] Appendix 1†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Page 27 Appendix 2†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ †¦. Page 28 Appendix 3†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ †¦Ã¢â‚¬ ¦.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. Page 30 Appendix 4†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Page 31 Appendix 5.. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. Page 32 Appendix 6†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ †¦Ã¢â‚¬ ¦. Page 33 Appendix 1 Specialist coffee shop brands, by gender, age, socio-economic groups and working status, November 2004 Base: 2,065 adults aged 15+ |   |Any branded coffee shop (%) |Starbucks (%) |Costa Coffee (%) |Caffe Nero (%) |Other branded coffee s hop (eg | | | | | | |Tchibo, Puccino’s) (%) | |All |32 |19 |14 |8 |5 |   |   |   |   |   |   | |Men |32 |20 |13 |9 |5 | |Women |33 |19 |14 |8 |6 | |   |   |   |   |   |   | |15-19 |35 |22 |14 |7 |4 | |20-24 |45 |27 |15 |17 |7 | |25-34 |45 |32 |21 |14 |6 | |35-44 |36 |21 |18 |8 |4 | |45-54 |29 |15 |11 |8 |7 | |55-64 |29 |17 |11 |6 |7 | |65+ |16 |6 |6 |3 |4 | |   |   |   |   |   |   | |AB |48 |31 |24 |15 |8 | |C1 |43 |27 |19 |11 |5 | |C2 |25 |14 |10 |6 |5 | |D |19 |9 |5 |4 |5 | |E |17 |9 |6 |4 3 | |   |   |   |   |   |   | |Working status: |   |   |   |   |   | |Full-time |42 |27 |19 |12 |7 | |Part-time |35 |18 |15 |11 |6 | |Not working |28 |18 |11 |7 |3 | |Retired |19 |9 |7 |3 |4 | Source: NOP/Mintel Appendix 2 Caffe Nero’s position and strategy with the 4P analysis Place: Most of our stores are situated in high street, where competitors tend to be concentrated as well. We have got some outlets in airports and ra ilway stations. We also have agreements with House of Fraser and Blackwell bookshops. Six House of Fraser department stores and four Blackwell bookshops incorporate a Caffe Nero. Finally we are considering international expansion. Products: Coffee: Italian coffee contained a blend of seven different beans. Our coffee is seen as the best in term of quality by UK customers (Allegra Consumer Report 2005 – Major Coffee Brands). Our menu contained different coffee derived products: – Espresso – Espresso Ristretto (very short and intense espresso) – Espresso Macchiato (espresso with a dollop of milk foam on top) – Americano (double espresso topped up with hot water) – Cappuccino – Caffe Latte – Mocha (cappuccino with chocolate) – Hot chocolate – Iced Latte (cold drink) – Iced Mocha (cold drink) – Frappelatte (cold drink and unique to Caffe Nero) We also propose milkshakes (Frappe milkshake) and fruit juice based drink (Fruit Boosters) that are also free from from artificial flavourings, colorants or preservatives. Food:We have tried to create a range of natural, fresh foods, avoiding all additives, artificial flavours and colourants. Our menu consists of Italian and Mediterranean food. Most of ingredients we used are imported from Italy. We also offer a range of lighter sandwiches and meals. As mentioned above, we try and we do serve the best quality food between the top five competitors (Allegra Consumer Report 2005 – Major Coffee Brands). Our soups have met with popular acclaim due to the take-away packaging that we have developed. 11 Cold sandwiches (Wraps, Wedges and other) – 20 Hot sandwiches (Paninis, Focaccias) – 18 Cakes and desserts – 13 Muffins and pastries – 4 Soups – 30 other products such as organic food, bruschetta, crisp, fruit salad, porridge, etc. Price: Our coffee p rices are on the average between the top five competitors. However, our food is more expensive than other competitors since we serve fresh food with imported ingredients in order to provide good quality food. Promotion: It seems that we do communication well. Indeed, our marketing strategy communicates on our continental style of operations and atmosphere. We support an image of Italian coffee bar which is reflected through our Italian and Mediterranean deli-style meals. This has allowed us to be rated as â€Å"The best expresso this side of Milan† by Tatler and labelled â€Å"The traditional Italian cafe† by Egon Ronay. Furthermore, as mentioned above we have been ranked first by British coffee drinkers in the last six years for the quality of our products. Besides, we have been involved in arts sponsorship from 1999. This allows us to bridge our image of Italian coffee bar with arts such as the Turner in Venice exhibition at the Tate Britain. Appendix 3 Caffe Nero’s Objectives The analyses of the current market as well as the analysts’ forecasts for Caffe Nero have led to the following three years marketing objective. Then we have extrapolated this long term objective into year objectives. Increase our market share to 30% between the top three competitors before the market reaches the maturity in 2009 in terms of turnover and outlets. o This means that we will have 600 outlets across UK. o All stores should reach at leas t ? 350  000 as turnover. †¢ For the year 2007 3) Increase the number of outlets by 38% to reach 400 stores by the end of 2007 (36% in 2006; 32% in 2005; 34% in 2004). 4) Increase our sales by 35% for 2007 (? 129,8 million) compare to 29% realised in 2006 (? 90,7 million). †¢ For the year 2008 1) Increase the number of outlets by 25 % to reach 500 stores by the end of 2008. 2) Increase our sale by 35% for 2008 (? 175 million). ) Start international expansion in Europe with the opening of one overseas store. †¢ For the year 2009 1) Increase the number of outlets by 20 % to reach 600 stores by the end of 2009. 2) Increase our sale by 20% for 2008 (? 210 million). Appendix 4 Analysts' Forecasts for Caffe Nero FY 2007 (June 2006 – May 2007) Analysts |Collins Stewart |Numis Securities |KBC Peel Hunt |Teather & Greenwood |Altium |DKW |Shore Capital |Average | |Sales (? m) |108. 1 |109. 9 |107. 4 |109. 7 |109. 9 |111. 3 |- |109. 4 | | Source: Caffe Nero, http://www. caffenero. com/FinancialInfo. asp? section=AnalystForecast&ZZIS_InformationID=1831 Appendix 5 The Strategic Planning Gap To achieve this objective we must develop strategies. Those strategies will act on different plans. The first plan that we need to consider is the market penetration. We expect to increase our market share by acquiring new outlets. As mentioned in the marketing objectives we need to open 110 new stores for the year 2007. Secondly, we would like to increase usage by expanding our clientele in targeting people older than 34. Finally, we need to develop new food products. This will also help us to increase our revenue. In fact, we need to focus on increasing spend by head and thus take advantage of the rise in Personal Disposal Income. Appendix 6 The franchise The franchise system consists to finance only 20% of the investment required for the acquisition of the store. The franchisee pays 80% of the acquisition and has to buy equipment and furniture from us. As franchise, all products used will come from us. We will assume the promotion, the staff training, the branding as well as some financial facilities. As compensation, the franchisee will give us 20% of his profit in the form of fees. [pic] ———————– Source  : Mintel Figure 3  : Figure 2 Source  : Mintel Figure 1 Existing Market New Market [pic] Revenue (? million) Figure 4  : Initial forecast (? 109,4 million) Source  : Caffe Nero (Appendix 1) Marketing objectif (? 129,8 million) Years

How may advertising act as a barrier to entry? Essay

Like almost every science, the school of Industrial economics is made up of theory and empirical studies. In Industrial economics, empirical studies are industry studies conducted by a number of researchers. Joe Bain, from the Harvard school of industrial economics, first mentions barriers to entry in an industry study he conducted in the early 1950s. Bain links entry barriers to the capacity to raise price above unit (marginal) cost in the long run without inducing potential entrants to enter the industry. Demsetz of the Chicago school links the idea of entry barriers to government based restrictions on entry, which are not relevant for this essay. Bain outlines a total of three types of barriers to entry: Absolute cost advantages, Economies of scale and Product differentiation. Bain links advertising and the creation of copyrighted brand names to product differentiation. In his 1956 industry study, he found that advertising acts as a barrier to entry more in some industries than in others. For example, he found that in the Automobile and Cigarette producing industries, advertising, effectively constituting as a barrier to entry in his belief, is used to a higher extent than in the caned fruit and vegetable industry. For a definition of advertising we refer to Colley (1961). He defines advertising as â€Å"mass paid communication, the ultimate purpose of which is to impart information, develop attitudes and induce action beneficial to the advertiser†. Advertising is usually used by firms to inform and/or persuade customers to buy their products. Firms also use advertising to remind ex-consumers that their product is still on the market or to hamper the entry of new firms into the market. It is important to establish whether advertising is predatory or cooperative advertising. Predatory advertising attracts away customers from competition, whereas cooperative advertising increases demand for all firms in the market. A profit maximising firm will typically advertise as long as the expected marginal revenue from advertising equals the expected marginal cost of advertising. Advertisement levels vary between markets mainly due to differences in market structure. For a profit-maximizing monopolist, the optimal level of advertising is dependant on the ratio between advertising and price elasticities according to Dorfmann and Steiner (1954). The greater the consumers’ responsiveness to advertising and the lower their responsiveness to changes in the product price, the higher will be the optimal level of advertising relative to sales. In an oligopoly market structure, Cable (1972), argues that advertising plays a more important role than price competition. Cable argues that rival firms quickly realize changes in price, which leads them to also lower their prices as a consequence. With regards to advertisement, it is unlikely that changes in their levels are quickly realized by the competition and effects on profits are unlikely to be closely related. This is the explanation why, according to Cable, in an oligopoly market environment high advertising intensity prevails. Advertising as persuasion – view This view is advocated by the Harvard school scholars, like J. Bain (1968). The assumption is that advertisement changes peoples perception of the product. According to Bain, advertisement increases market power and prices, as well as distorting consumers’ preferences. Bain argues that by changing the consumers perception in favour of the advertised product, demand for it becomes less price sensitive, more inelastic to changes in its price. Without any immediate changes in the competitor’s advertisement levels, consumers will be less likely to change their choices, even if the competitor lowers prices. If a rival company wishes to enter the market, it has to either offer substantial price cuts or advertise more than the incumbent. Bain classifies â€Å"persuasion† advertising as a barrier to entry, since either lower prices or heavy advertisement spending will heavily reduce the entrant’s potential profits. John Sutton brought an extension to Bain’s â€Å"Advertising as persuasion†-view in 1992. Sutton sees advertising as an endogenous strategic â€Å"sunk cost† expenditure, which firms alter like they alter price and quantity. In his model, Sutton assumes that companies use advertisement to influence different levels of perceived quality just like Bain does. This leads to consumers perceived quality becoming a function of firms’ advertisement. F(u) = f + a (u), where F(u) is the total level of fixed costs and u is the perceived quality, with a (u) being an increasing function. Sutton finds in his three staged game, that even as advertising levels increase, the number of firms in the industry remains unchanged, even if the market is growing. (Church and Ware, 2000) Advertising as information-view This view is advocated by the Chicago school scholars, like Stigler (1961). He sees advertising primarily as a means of firms providing information to consumers, who lack knowledge about the products on the market. Stigler reckons that advertisement changes consumers perception about a product so that they can make the decision as to which product is best to them. Different to Bain’s theory, this information will actually make the demand for products more price elastic. Consumers have more information about the product and will make more rational decisions. This leads to companies competing and a lower profit maximising price for the incumbents. New firms can make customers aware of the features and prices of their products though informative advertising. Whichever firm, whether incumbent or entrant, offering the best value for quality in the eyes of the consumer, will expand in the long-term, benefiting from economies of scale, leading to higher levels of concentration. In the long term, therefore, effective informative advertising may also be classified as a barrier to entry. Empirical evidence Catherine Matraves studied the â€Å"Market structure, R&D and Advertising in the Pharmaceutical Industry† in 1999. She found that as markets across the world in this industry become more liberalized and open, e. g. total market size increases, advertising spending of surviving firms also increased. Matraves uses Grabowski and Vernon’s industry studies of the pharmaceutical industry in her paper, which reject Bain’s â€Å"Advertisement as persuasion-view†, but support the Stigler view â€Å"Advertisement as information†. Grabowski and Vernon found that high advertisement-sales ratios did not act as an effective barrier to entry. Geroski and Murfin (1991) observed a different relationship between advertisement and entry. The two researchers found that in the UK car industry falling concentration and increasing imports lead to an increase in advertisement intensity. They conclude their findings in saying that advertising facilitates entry to the extent that an entrant can account for a large share of total industry advertising. However, they note that it is very costly to acquire this large share of advertising. Fiona M. Scott Morton, also studied the Pharmaceutical Industry, but only looking at the U. S. (1998). Fiona looked at the entry decisions generic pharmaceutical manufacturers face when they look at markets which have been opened by patent expiration to competition. She confirms the findings of Grabowski and Vernon (1992) stating that advertising is exogenous to entry decisions. She finds some evidence that brands may affect generic entry very slightly by advertising before patent expiration, but both effects are â€Å"nearly insignificant†. Fiona concludes her paper stating that â€Å"brand advertising is not a barrier to entry by generic firms into the US pharmaceutical market†. Conclusion We have seen two models in this essay, Bain’s â€Å"Advertising as persuasion-view† and Stigler’s â€Å"Advertising as information-view†. The models outlined show how the different views shared on the purposes and effects of advertisement yield different outcomes on concentration and market entry. Persuasive advertising causing high brand loyalty forces potential new entrants to either outspend the incumbent for advertisement expenditure or to offer high price cuts. These constitute in substantial barriers to entry. Stigler’s â€Å"Advertising as information-view† sees advertisement as a barrier to entry mainly in the long term, as companies selling products at the best price for the best quality to well-informed consumers, expand and benefit from economies of scale. However, empirical research shows that in the majority of industries, advertising does not constitute in a barrier to entry. Bibliography: Joe Bain: â€Å"Relation of Profit Rate to Industry Concentration: American manufacturing, 1936-40†³, 1951, Quarterly Journal of Economics; Barriers to New Competition†, 1956, Harvard University Press; Industrial Organization, 1968 Grabowski, H. G. and J. M. Vernon, â€Å"Brand loyalty, Entry, and Price Competition in Pharmaceuticals after the 1984 Drug Act†, Journal of Law and Economics, vol35, Pages 331-345 Catherine Matraves: â€Å"Market structure, R&D, and Advertising in the Pharmaceutical Industry, The Journal of Industrial Economics, Pages 175-177