GOURMET is a good example of blue oceans. gourmet is a successful story and after achieving its stability position, Gourmet has tried to match its products with the big international brands, established ones, like Pepsi, Coca-Cola. In ice cream industry, Gourmet has rivalry with Walls. In milk industry, Gourmet competes with Nestle or Milkpak. Gourmet's strategy is to provide quality product and service to its consumers at the economical price.
Gourmet has created a reasonable value with its customers at a lower cost. it has pursued differentiation and economical cost simultaneously.
21 comments:
Its right that gourmet is moving successfully but u canot compare it with the big guns of the market. comparing gourmet with Pepsi, coca cola and other big companies, i don't agree with that . these are the mature companies and have a high brand loyalty so it is difficult for gourmet to divert the customers of these brands to gourmet. even though it is offering low prices, it is mentioned in the notes that price does'nt give an edge towards the blue ocean. M Omer Azeem Siddiqui
Absolutely right...Gourmet, i would like to say that it is a very restricted brand till now..because Gourmet has restricted his products till its own branches..you wont find any gourmet products on any other store..so this can be challenge for them to compete with Pepsi, coke..which we find everywhere
Comparing Gourmet with international brands would not be a rational approach.Actually Gourmet is not competing with Pepsi,Walls or Halib,in fact it is efficintly outshining bakery brands only in Lahore.
The biggest challenge to gourmet is the taste and the manufacturing formula of Coke and Pepsi. As there is no big competitor of gourmet cola in market except Pepsi and coke or international brands so it is more important for gourmet to set its strategy to compete those brands.
My question to everyone is that; Why Shehzan is not been able to imitate Gourmet's strategy? or that Shehzan is trying the other way out?, like they are trying to give more quality with slightly higher prices? Are they operating under two distinct strategies?
Gourmet is a RED Ocean strategy, as it is not the pioneer in the field.... I think Shezan created a blue ocean and Niralla also contributed a little, gourmet simply re-introduced the concepts and took it to greater heights cos of their execution strategy.
Mozamm:
Shezan's USP is not exactly price,,, i believe that they are simply milking the Cow i.e. they have reached the saturation point, they r experiencing slow growth and stable sales, the management seems satisfied with it and therefore they do not wish to innovate and explore new segments of the market - they continue selling the same products with the same Unique taste.
@ awakening
in my openion shezan was a cash cow but now its condition is as bad as DOG. there is a huge decrease in their sales and they are actually in the phase of surviving not the saturation point....
yar shezan has been left very far behind. I think its out of competition. From the bignning till now they r providing same stuff and there is nothing new that can provide them competitive edge. They r even kicked out of the red ocean. Tell me any 1 product of shezan that brings them into competition.
And one another major reason for their low sales is the religious conflict.
I completely disagree with this statement of Blue ocean strategy as far as gourmet is concerned. opening so many branches does not mean acquiring the share of market. secondly look at the quality of products. do u really think that there is any competition of gourmet cola with pepsi or coke? Frankly speaking if you compare SHEZAN products with gourmet they are far better in some ways. in short i think gourmet has successfully launched its mineral water. thats it not more than that
Omer
It is confirm now that Shezan doesn't belong to that religious sect. The Shahnawaz group of Mercedes is separated from Shezan. Now Shezan is owned by the Islamic Group
@Adil Nasim
Shezan, Mercedes (Pakistan dealerships) and all the manufactured products are owned by the Shahnawaz Group and have been the same way since almost the last 50 years, and this group is the only certified cooperation of Pakistan given the licence to sell Mercedes cars through a dealership in Pakistan. Please do some research before typing any such thing on these blogs. Personal views aside the above mentioned business sectors are and have been owned by the Shahnawaz group.
Dear Omer
As for as Shezan is concerned, the ownership of Shezan is changed from Shahnawaz group as you mentioned the guys belonging to Mercedes dealership
Go and you please confirm that
I discussed this with many reputed people like Dr. Farid A Malik
So please you confirm this
Thanks
Shezan core competence is their unique taste, which has not changed at least as far as i can recall :-)... they do increase their price but the taste and quality is the same :-)
and their target market is probably people who probably do not like change and want their fruitcake to always taste the same :D
well u talk about Shezan.. Do you know that Shezan is revising its strategy? Shezan had actually suffered from market share loss and it was primarily because of its cake taste.
(go and search the real story behind)
I think gourmet can't compit with the international brand Like pepsi and others. Gourmet is the local brand which is not famus yet in all over the Pakistan. Then how can they compet with multinational brands.
Quality of gourmet products specially in Bakery itms also decrease. Gourmet will suffer in future like Sehzan today...
Gourmet in competition with Multinationals....No way. I agree with Burraq.
Talking about blue ocean strategy, i think it is nowhere near it. Reasons:
First, although it has diversified itself into many products, it has not created a new market, it has just entered into existing ones where there already are many rivals competing against each other. Second, blue oceans are not created by doing what everyone else is doing to achieve operational efficiency by quality increases or low prices which in themselves are small tools to compete against others.
So, Gourmet is still operating in red ocean i would rather say red oceans like dairy products industry, beverages, and bakery industry and its not even a big one in any industry.
Are you trying to make the point that “no company can adopt blue ocean strategy at country level? It is necessary for any company to be amongst the top tens and be worldly recognized? And only then with this aim a company can adopt Blue Ocean Strategy? “
I think, Blue Ocean Strategy’s purpose is to provide competitive edge and to increase the company’s growth.
Gourmet is till now focusing on Lahore. And what I have said is that Gourmet is adopting a Blue Ocean Strategy. Providing the reference of W. Chain Kim and Renee Mauborgne:
1. When it comes to creating Blue Oceans, the evidence shows that successful companies pursue differentiation and low cost simultaneously.
WHO disagrees with the economical prices being offered by Gourmet and the differentiated products being produced by Gourmet?
2. Cirque offers the best of both circus and theater.
Is gourmet not providing the best of dairy products/ ice creams, soft drinks/ bottled water and then the bakery items?
3. The same company can be brilliant at one time and wrongheaded at another. Every company rises and falls over time.
Gourmet has successfully tried its best and now it is among one of the known, recognized and established brands that exist in Lahore. And we find today the Gourmet outlets in other cities too…soon they will be opened, and if it struggles hard with determination, then you all will see it competing with World’s brands. :D
4. Likewise, there is no perpetually excellent industry; relative attractiveness is driven by the creation of Blue Oceans from within them.
So, here is my point. Never mind.
we are here to learn
Is the cola market really a blue ocean. Or is gourmet's strategy there just based on low cost competition? If gourmet was to charge the same or higher prices for its cola would ppl still buy it?
gourmet can not compete with international brands because its approach to do business is local and static instead of global and dynamic
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