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Old 26.04.2006, 02:18
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Seeking feedback for Marketing class project

Hello from California!

I am in graduate school (University of California at Davis) taking a marketing class, and our big class assignment is to come up with a product and research how it might perform and how we would market it in a foreign country. One of our team members was born in Switzerland and a good friend of mine at work is Swiss but has been living in the U.S.A. for the last 16 years. So, we though Switzerland would be a good place to try to market a product because of the feedback we could obtain. I ran across this forum in my Google searches and thought I might throw out our idea and see what you guys think. Thanks in advance for any feedback!

In our project, we actually picked a food chain that has been successful in the United States, but hasn't gone outside the U.S. except for one store in the Bahamas. The franchise name is Jamba Juice (www.jambajuice.com). They make dairy and all-fruit smoothies with an emphasis on health benefits of the high-fruit content. They also include free "boosts" (I uaully pass on these myself) such a vitamin boost, a protein boost, etc...

Our professor has already hit us with some questions about our selections and I offer them here for your feedback. Again, thanks for any help!

How unique is the Jamba Juice product? What other healthy drink alternatives exist in Switzerland? Are there local competitors?

Are the Swiss used to buying drinks from stores (similar to Starbucks cafes)? If not, would this be a barrier?

Are smoothies popular in Switzerland? How about tropical flavors?

Thanks again for any help!
Jason
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Old 26.04.2006, 08:15
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Re: Seeking feedback for Marketing class project

Hi Jason,

Let me congratulate you on an excellent choice of country for your marketing project. Not because the product would necessarily do well here, but because this is going to make for some interesting discussions both on this thread and with your classmates. It is possible that your Swiss classmates may violently disagree with our opinions and assessments!

I'm sure I'm not the only one who will post on this thread, and subsequent posters may have an entirely different opinion to me, but that's the way these things go in this kind of survey.

So these are my thoughts based on my experience. They are often shaped by my irritation with the Swiss soft drink market.

* This is a country where the most popular drink is made from milk serum. The product is called Rivella (hey guess what - their website is in 2 languages, but not English, and Italian has also been forgotten - very Swiss). They attempted to market this product in other countries and it was a spectacular flop. It remains a very popular product with the Swiss. I personally don't like it, but it seems to be one of those things that you have to grow up with the appreciate it...

* The Swiss are not early adopters of very much at all, and prefer always to wait and see what other people do before making a move. They will never stick their neck out in case it gets chopped off.

* Choice and range of products in general is very poor. This is slowly changing as foreign competition in the retail sector starts to put pressure on the local market. Choices of cold drinks (if they are indeed cold) at many kiosks are, in comparison to the US and other consumer-orientated countries is usually quite poor. To give you an example a typical place will carry Fanta, Coke, Water (1 brand of still, and 1 brand of sparkling), Rivella and Ice Tea (a very sweet mix, also tends to found only in Switzerland - I think it's disgusting but the Swiss complain about the Ice Tea not being correct when they go abroad). This is also the standard vending machine mix.

* I spent a lot of time in Australia, so I am familiar with the concept of fruit based products being popular. This is not the case in Switzerland. Almost all the time when you buy an orange juice product it is made from concentrate, this applies to the supermarket and also to restaurants. These days it is not impossible to get freshly squeezed, but it is very much the exception rather than the rule. I've generally given up on drinking orange juice here for that reason.

* Smoothies are virtually unheard of. In fact I don't ever recall seeing one, but I'm sure as soon as I say that there will be a flood of responses saying that smoothies are everywhere. For example, starbucks may carry something like this, but I only drink the coffee since everything else they sell seems to contains levels of sugar which should probably be illegal

* The Swiss seem to be swayed by messages of products being healthy. For example chewing gum is marketed to adults with messages about how good it is for your teeth. It also costs a fortune. At the rivella website check out the Michel products. These are fruit-based but made from concentrates and very sweet. They usually come in very small packaging (common to fruit-based products, as if it is some sort of luxury) and are very sweet. Again, not a big fan of them, but one often finds that they are the only choice if you want something with fruit. The marketing is very much health based, hence product names like "bodyguard". But hey look - now there are 6 flavours for the relaunch, there used to be only two!

* Getting anything new into the distribution chain, especially in the German-speaking part of Switzerland is extremely difficult. Much of it is cartel-based and new kids on the block are never appreciated.

Now there is a silver lining to this cloud. On the surface it would appear that marketing any new product in Switzerland is hard, but anyone who studies marketing, especially in the soft drink field would have heard of the Austrian company that brought us Red Bull. Red Bull is also very sucessful in Switzerland, though it is aimed at a niche market, and I think it is the same company that recently brought us Carpe Diem which seems to have appeared in quite a few stores. This is usually my choice, not because I go for all the mystical rubbish written on the label, but because I don't want to drink coke, rivella or ice tea.

So this shows that there is room in the Swiss market for new products - in fact that hole in the market is so big you could drive a freight train through it. It also shows that it is not impossible to bring a new product, but you better have your bases covered and spent a lot of money!

Conclusion: This is a very high risk country for your product (in the sense of your project work). If I were the investor that had to put the money up for this, I think I would probably decline.

That's just my opinion, but I'm sure Richard will be along shortly and post counter arguments to the above points. I'd be interested to hear other feedback!

Mark
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Old 26.04.2006, 09:27
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Re: Seeking feedback for Marketing class project

Further to the "free market economy" here, you'll find that there are products that only one supermarket chain will stock - so you'll have to shop in two stores if your shopping cart needs to be filled with such items.

10 years ago, shopping (for groceries) was even worse here. The apparent shortage of ethnic foodstuffs in mainstream supermarkets, the high price/low quality/non-rotated stock (yes, you could happily purchase "expired" items at full price) being just a few glitches in the Swiss matrix.

Now it is MUCH better but you only have to do some border-hopping to see what grocery shopping should be all about.... and many many many people do go "abroad" for their grub. I personally enjoy Iper in Italy myself - lots to choose from, lots of special offers, excellent prices. Plus the checkout girls usually make some effort

I'd suggest studying what happened to Planet Hollywood in Zurich; you have to note that Swiss do tend to embrace things American but PH was a dismal flop.

It's a cliquey-culture, for want of a better phrase, and you have to address your target market well.

And finally, your fellow general in the Swiss army who works for Migros is probably your most important friend!
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Old 26.04.2006, 09:33
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Re: Seeking feedback for Marketing class project

Hey Lob,

We are giving this poor guy quite a headache. I can see his entire assignment imploding into a pile of dust under the weight of all this "Swissness" - just wait until he tries to explain all this to his professor. He might get "Don't bring me problems, bring me solutions" hehehe
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Old 26.04.2006, 17:56
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Re: Seeking feedback for Marketing class project

Actually this is all great information! We're supposed to have some reasoning for trying our product and country combination, but we can also come back at the end (which is six weeks in this case) and say after all of the research that we recommend against trying the product in the new market.

So, all the info (for and against) is valuable. Cases like the Planet Holywood failure are especially great for us research and report on the cause of failure.

Since Jamba Juice operates much like Starbucks -- you go in, order your smoothy, pay, and wait for it to be prepared -- and based on my research, it looks like Starbucks opened in Switzerland in 2002, I'd appreciate your feedback on how people have reacted to the company.

In the U.S. we have franchises companies teaming up with other stores to expand their customer base. For example, Starbucks has kiosks in some of our grocery stores and gas stations. If you go to a gas station, you can find a fast food chain lsuch as Subway or Kentucky Fried Chicken. Does this trend exist in Switzerland and would you expect a Jamba Juice to have a better chance of success if it introduced itself as a grocery store kiosk for example. What other types of locations might work well (given that they are a bit loud when they have to run the blender for your drink so a library might be out of the question )

Thanks again for all of your feedback!

Jason
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Old 26.04.2006, 19:09
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Re: Seeking feedback for Marketing class project

Hi Jason,

I've just had a quick look at the web site. Although I can't claim to represent the whole country, I can't be the only one that would answer as follows:

>How unique is the Jamba Juice product?
It's unique. Whenever I walk through the city I look for a juice bar. Even the gym's that I've been to don't have fresh juice. I travel frequently to other countries, including relatively poor countries, and always find juice bars.

> What other healthy drink alternatives exist in Switzerland?
I don't like carbonated drinks, so my only option is still water. Usually I drink bottled water, rather than tap water. I'm naturally suspicious that carbonated drinks can be really healthy.

> Are there local competitors?
If so, then I haven't found them.

>Are the Swiss used to buying drinks from stores (similar to Starbucks cafes)? If not, would this be a barrier?
There is a café society here in the city, so it would not be a barrier.

> Are smoothies popular in Switzerland? How about tropical flavor?
No idea.

=DM=
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Old 26.04.2006, 20:42
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Re: Seeking feedback for Marketing class project

Hi Jason,

I tend to slightly disagree with some of the comments made previously. It is true that most of the usual suspects in terms of distribution have limited product offerings, and to a large degree control market factors with cartel behavior. However...there are opportunities....

If one looks a little bit outside the normal chains, then you are quite likely to find a wider selection (I know of a couple of locations in Zürich selling fresh juice drinks...including smoothies - both are in high traffic locations). There are also other producers in the market (have a look at Traktor Bio-Smoothie - their site is only in german, but if you click on the link that says Traktor Kaufen, then follow another link to die Verkaufstellen you will come up with their distribution list throughout Switzerland. It is quite varied). Another factor to consider is the ever expanding pressure from the surrounding EU countries and their firms. In my opinion, the market will continue to open over the next few years, bringing new opportunities - and something that should not be ignored by anyone thinking of launching a new product in Switzerland.

From a packaging perspective...most products in Switzerland are required to follow rather strict Swiss labeling laws - including placing all information in three languages. This is often a big deterent to a small company wanting to expand...It is easier to find your distribution chain in an EU country and make your labeling the same throughout...

Finally...there's always the option to sell the brand to a small Swiss company - Nestle!

Good luck,
Jack
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Old 26.04.2006, 23:57
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Re: Seeking feedback for Marketing class project

Thanks, Jack!

Just to clarify, Jamba Juice is a relatively-large chain in the U.S. with a few hundred stores -- for our case report, we have to determine if this chain could succeed in the Swiss market. Although everyone in our group likes Jamba Juice smoothies, we have no other affiliation with them.

Per region would also be interesting -- for example, I know that although they would do well in more urban areas of the U.S. where the populations tend to be young professionals but may not do so well in a older farming town where people are happy drinking water and get plenty of exercise from their everyday activities.

Jason
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Old 29.04.2006, 09:54
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Re: Seeking feedback for Marketing class project

Quote:
I know of a couple of locations in Zürich selling fresh juice drinks...including smoothies - both are in high traffic locations
Hey Jack, spill the beans! Where are they?

Cheers,
=DM=
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Old 29.04.2006, 09:57
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Re: Seeking feedback for Marketing class project

In addition to my previous comment.

I now know what a smoothie is. Yesterday, on the way to board a train a Paddington Station (in England), there were a gang of kids thrusting bottles of fruit drink into people's hands.

The accompanying brochure invites us to visit: pj.smoothies.co.uk

That's also a common practise in Switzerland. Namely, to put a huge gang of representatives in main train stations at peaks hours, who hand out samples.

=DM=
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Old 29.04.2006, 18:29
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Re: Seeking feedback for Marketing class project

Quote:
Another factor to consider is the ever expanding pressure from the surrounding EU countries and their firms. In my opinion, the market will continue to open over the next few years, bringing new opportunities - and something that should not be ignored by anyone thinking of launching a new product in Switzerland.
I'd really hope that the market opens up here - it would be good news for everyone except the vested interests.

However, I tend to agree with Mark's comments. Consumers here are generally reluctant to try new things, especially 'foreign' products, and prefer to wait until something becomes popular. The way to do that is to throw massive amounts of money at promoting the brand and convincing people that it's already a success.

There is also a massive cartel system in place in virtually every sector of commerce, as far as I can tell. Supermarket chains tend to carry only one or two brands of a product as they've sewn up deals with the suppliers. If you are used to a more consumerised society, it's a real pain. As already mentioned, assuming you have your own preferences for products you'll probably end up doing your weekly shopping at at least two different supermarket chains in order to get everything that you want.


Your best bet to introduce a product into Switzerland is to sign up one of the existing members of the cartels here. They'll have the muscle to get it into stores and a brand image that will encourage people to 'risk' their francs to buy it. Of course, doing so will entail them taking a generous percentage of the profits.


Gav
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Old 29.04.2006, 18:45
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Re: Seeking feedback for Marketing class project

I also agree with Diem - Jack: Tell us where the smoothies are!!

Maybe you could plaster the packaging with Swiss flags and say how you support Swiss farmers and rename the product to something like Swoothie (Swiss-smoothie). Then get some Swiss sport stars to drink it, bang on about how Swiss fruit is the best fruit in the world. That ought to do it
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Old 30.04.2006, 00:04
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Re: Seeking feedback for Marketing class project

This is almost off topic I know so I do appologise Jason, but for those of you looking for a juice bar, there is an excellent one near Kreuzplatz next to the healthfood store and the Post Office...
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Old 30.04.2006, 09:26
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Re: Seeking feedback for Marketing class project

Quote:
Your best bet to introduce a product into Switzerland is to sign up one of the existing members of the cartels here. They'll have the muscle to get it into stores and a brand image that will encourage people to 'risk' their francs to buy it. Of course, doing so will entail them taking a generous percentage of the profits.

Gav
You're absolutely correct in my opinion! Right now distribution is the king, but I see a brewing battle between producers and suppliers. On the one hand, producers want to expand their market reach because Switzerland is just too small (for most anyway) to support long term growth. They are actively pushing for EU incorporation, or at least an expansion of access into the EU market without high tariffs. On the other hand, the suppliers want to protect their cozy cartel-like situation and not allow any increased competition into the Swiss market. Companies like Migros must be going nuts internally because they are doing both, and trying to push for a situation in which they both enjoy expanded EU opportunities and protected Swiss markets. Meanwhile, the EU just sits back and tells Switzerland...if you want access to this big carrot, then you must allow unencumbered access into the Swiss market. I think, over time, the suppliers will win and there will be an EU integration... Until then, it is quite possible that the big Cartel-like suppliers in Switzerland will attempt to partner with large EU producers/suppliers in an effort to continue controlling their present distribution. Of course, over time, this type of 'partnership' will crumble and be replaced with a more advantageous cost structure.

As for finding juice/smoothies...

The Saftladen at Münstergasse 31, 8001 Zürich
Can't recall the name of the other, but it is easy to find. From the Bahnhofstrasse at the Renweg tram stop...proceed on the street just opposite Coop St. Annahof in the direction of Renweg. It is about 30 meters up the street on the left hand side (the next time I go I will find out the name). They have a very nice juice/sandwhich selection (also non-smoking)...

Jack
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Old 01.05.2006, 21:17
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Re: Seeking feedback for Marketing class project

All this talk of smoothies and juice bars is making me thirsty It doesn't help that it's my lunch hour and its 81°F (27°C) outside right now.

Besides Starbucks, what other foreign chains do you see in Switzerland?

Jason
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Old 01.05.2006, 22:38
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Re: Seeking feedback for Marketing class project

It might be easier to ask which chains are not in Switzerland...
Jack
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Old 18.05.2006, 22:39
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Re: Seeking feedback for Marketing class project

Hello everyone,
Sorry I am joining the discussion late. I am in Jason's group trying to market Jamba Juice for our class project. I carry duel citizenship with Switzerland and was born in Zurich so I guess I sort of influenced the decision to bring Jamba Juice to CH! All of the responses are very helpful to us and I thank you for your feedback.
I agree that the choices of juices in Switzerland are lacking. I too have tried Rivella and was perplexed as to why it is so popular. Probably my favorite juice is the Apfelsaft as the orange juices are way to sweet for my taste.
I also agree that we would have to market some of the smoothie choices toward Switzerland with names such as a "Farmer's Smoothie" with some sort of Swiss connection. Some people drink these smoothies "on the go" as sort of a quick replacement meal, so I think a great place to bring them to would be the train stations. The fact that RedBull was marketed successfully in Switzerland is a positive fact for us.
I will be in Switzerland at the end of June and wish I could bring you all some Jamba Juice smoothies to try but I think they would melt before I arrived on the plane!
Most of the smoothies I have seen in Switzerland are very heavily based with yogurt. Jamba Juice carries some with frozen yogurt and some that are just fresh fruit based. They also come with a choice of a "Boost" which is added to your smoothie which contain variations of vitamins or protein depending on your needs/wants. I guess one question I have is how popular are vitamins in Switzerland and do the majority of people take them? I know when we visit our relatives always ask us to bring them multivitamins from the US because they are so expensive there. (In reverse I tell them I need my swiss-vitamins which is of course swiss chocolate in exchange!)
Thanks again for your responses!
Cheers,
Jamima
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Old 23.09.2007, 21:40
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Re: Seeking feedback for Marketing class project

Just a little heads up, since 2004 there was a juice bar chain created with it's base in Lausanne (rue du grand-Pont 18) www.zeste4life.ch. They now have three stores, Lausanne, Neuchatel and Bienne. They will also open in october this year a store in Geneva close to the train station (centre manor). There juices and smoothies are the real thing, just like those from Australia (my home country) with amazing friendly service, a breath of fresh air here in Switzerland! Personally I have tried Jamba, good, but too icy for me. Zeste wins outright.
You must check them out
All the best with your study
melly
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Old 09.10.2007, 15:03
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Re: Seeking feedback for Marketing class project

Hello Jason

I want to give you the opinion of a Swiss here:

I have lived in the USA for 3.5 years, loved smoothies, and also tried Jamba Juice once when I visited San Diego. Now granted, I'm probably younger & more adventurous than the average Swiss person, but I certainly don't think that selling smoothies in Switzerland is doomed.

Also, I have noted that recently smoothies are being sold at Coop (large retail store here) and Kiosk. I especially see this brand "Traktor" now in many places, and I happily pay the outragous prices to buy a smoothie here.

Now my last comment is about Starbucks. I remember in ca. 2001/2002, when Starbucks opened the first branch in Switzerland, there was a big article in the "Cash"-Newspaper about how this company is going to fail because in Switzerland you can already get excellent strong coffee without having to pay the outrageous high price of Starbucks coffee. Now, a few years down the road, Starbucks is a big hit here! So I would defenitely say "never say never", Jama Juice might become a hit as well.

Ok, I also just remember that this year I went to a newly opened Subway restaurant in Zurich. The first time was right after they had opened, and nothing spectacular. But when I went back a week later, there were at least 30 - 35 people queing waiting for their food. This is certainly not normal in Switzerland. So I'm thinking that anything American has a good shot at suceeding here
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Old 09.10.2007, 16:22
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Re: Seeking feedback for Marketing class project

I think you're about a year and a half late with your feedback!
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