Marketing Plan Sugar Free Hot Cocoa Mix Essay Example

Marketing Plan: Sugar Free Hot Cocoa Mix Essay The purpose of this assignment is to launch a new product in a specific market segment. In this case, this product is a sugar free hot cocoa mix called â€Å"Cocoa Jewels†. The following chapters treat the key elements of establishing a new product with the goal to derivate a strategy for â€Å"Cocoa Jewels† in order to successfully entrench and operate the brand on the market. Furthermore this product launching strategy is based on the condition that our product is released by a food producer that is operating on the business to consumer market. 2Environmental analysis 2. 1Political and legal conditions The international trade of cocoa is regulated by the International Cocoa Organization (ICCO), a global organization composed of member countries from both cocoa producing (African, South American and Asian countries) and cocoa consuming countries (including Germany and the whole European Union, Switzerland and Russia). In 1973 it was established and since then put into effect, six International Cocoa Agreements, the last of them was negotiated in 2001 and came into force in 2003. The purpose of the International Cocoa Organization is to â€Å"work towards a sustainable world cocoa economy†. This includes work on customs tariffs on cocoa beans, cocoa semi-products and chocolate import and taxes related to cocoa consumption and processing. Besides prices are also fluctuating because of seasonal influences. They also depend on the rate of the London International Financial Futures and Options Exchange (LIFFE) and the Coffee, Sugar and Cocoa Exchange Inc. of New York where cocoa is mostly traded. 2. 2General economical conditions The global crisis of the last years had an impact on the German economy. For the first time in five years, the country had a negative economic growth (-5%). We will write a custom essay sample on Marketing Plan: Sugar Free Hot Cocoa Mix specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Marketing Plan: Sugar Free Hot Cocoa Mix specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Marketing Plan: Sugar Free Hot Cocoa Mix specifically for you FOR ONLY $16.38 $13.9/page Hire Writer The rise of the prices abruptly dropped in 2009 from 2,6% to 0,4% after 4 years of constant augmentation. The money spent by households for personal consume dropped from 2,5% in 2008 to 0,5% in 2009. However the German government is hoping for amelioration for the coming years. It expects an economical growth of 1,4% for 2010 and 1,6% for 2011 as well as an increase of the working population. Moreover a 2,5% augmentation of the average worker net income which should revive the private consume. We see this revival of the private consume as an opportunity for the launching of a new product. 2. 3Demographic conditions The demographical condition of Germany records a decreasing population which is getting older. Also the total number of single and two-person households is rising. Creating a product which attracts the upper age classes opens up new market potential and opportunities. 3Market analysis The following market analysis is based on our product strategy which will be described later and therefore only takes the European market into account. Before entering a new market, by launching a new product or establishing a new business, the first things to determine are basic facts about this specific market. The market analysis describes a systematic study of a market or market segment, regarding the market situation, customers and competition. The goal is, to determine the market attractiveness and opportunities as well as the strengths and weaknesses of the organization concerning the market. The following chapter treats: ?Market information ?Competition ?SWOT Analysis 3. 1Market information The world’s leading importers and ultimate consumer of the cocoa bean and cocoa products are the United States and Europe. These nations receive approximately 50% of the total number of imports. The sources of imports differ, depending on each nation. About 38% of the German cocoa import is used for beverage production. The total share of these beverages on the cocoa per capita consumption amounts to 7,3%. Since we concentrate on the European market -particularly the German market- the spotlight of interest lays on the largest consumers of cocoa products. The following chart exhibits the European countries with the largest per capita consumption. The six largest consumers by size -numbers in kg per unit- are Switzerland (10,2), Germany (9,3), Belgium (9,1), United Kingdom (8,8), Ireland (8,8) and Austria (8,5). The European average amounts to 5,8 kg per unit. 3. 2Competition Competition may be best described as rivalry in which every seller tries to get what other sellers in the same market segment are seeking, such as sales, profit and market share by offering the best practicable combination of price, quality and service. This paragraph deals with the major competitors market. Competition needs to be divided in three categories. The first category is the immediate competition or direct competition. It is defined as the party who offers products which are technically similar to the own product. The second category is the secondary competition, which offers products solving the same problem in a similar way. The last category is the tertiary competition who offers a different product which is solving the problem in a different way. A recent market research shows that our product is serving a niche market because of its specific characteristics and therefore doesn’t have immediate competition on the European market. However, there are products which are relatively similar to ours by attaining the requested result in a slightly different way. On the basis of this research we determined the major competition. 3. 2. 1Wander AG The product closest to ours is produced by a Swiss food giant by the name of Wander AG. The product portfolio includes â€Å"Caotina†, a cocoa drink which comes in powder form. â€Å"Caotina† is available in several different kinds such as noir (43% amount of cocoa), blanc (white chocolate), surfin (milk chocolate) and sugar-free. The package size differs from 500g per unit up to 1000g per unit and includes 15g portion packs. â€Å"Caotina† sugar-free is only available as a 270g â€Å"ready to drink product†. In terms of price, the average cost per 100g Caotina is 0. 94â‚ ¬ per unit. The promotion of â€Å"Caotina† mainly proceeds over television and internet merchandising, targeting adults who like to experience â€Å"the unique pleasure of chocolate†. Since the television promotion is in the form of commercials, the internet promotion is managed by an own brand homepage on which customers can find additional product information and recipes. The product is available anywhere in food retailing, such as Edeka, Rewe or Aldi, and also in many restaurants. 3. 2. 2Nestle S. A. Nestle S. A. is the world? s largest food giant and owns hundreds of different brands, among others â€Å"Nesquik† and â€Å"Nestle Feinste hei? e Schokolade†. â€Å"Nesquik† is a cocoa drink (19% amount of cocoa) which in general comes in powder form but is also available as â€Å"Nesquik† sugar-reduced, Syrup, Ice and Ready-to-Drink. Nesquik† is offered in 800g and 400g package as well as 500g refill-packages. The average price per 100g is set at 0. 41â‚ ¬. The promotion of â€Å"Nesquik† proceeds over television and internet merchandising, targeting children and parents. The television commercials especially attract ch ildren by using bright colors and the Nesquik-Bunny informing them about how tasty and cool â€Å"Nesquik† is. The internet promotion is more complex because it consists of two different platforms on which â€Å"Nesquik† is presented. The first one is the â€Å"Nesquik† homepage. It is divided into a child section and an adult section. The child section contains games and downloads whereas the adult section contains additional product, health and nutrition information as well as recipes. The brand is also present on social platforms such as Twitter, Facebook or Youtube where anyone can join the â€Å"Nesquik Club† and get the latest product information. â€Å"Nesquik† is obtainable in food retailing such as Edeka, Rewe, Real or Aldi. â€Å"Nestle Feinste hei? e Schokolade† is a cocoa drink (32% amount of cocoa) which is only available in powder form. The package size amounts to 250g which leads to an average price of 1. 16â‚ ¬ per 100g unit. Unlike †Nesquik†, â€Å"Nestle Feinste hei? Schokolade† has no particular promotion but promoted in context with other Nestle products. It is also presented on the Nestle homepage with the option of getting additional information about the product. It is available in food retailing such as Edeka, Rewe or Aldi. 3. 2. 3Kraft Food Inc. Kr aft Food Inc. is the world? s second largest food giant. The company? s product portfolio includes foodstuffs, confectionery and beverages such as â€Å"Kaba† and â€Å"Suchard Express†. â€Å"Kaba† is a cocoa product which is mercenary only in powder form which contains 18% of cocoa. The package size differs from 500g up to 800g. The average price is set at 0. 6â‚ ¬ per 100g unit. The brand promotion is mainly proceeds by television commercials. The commercials make use of experience groups in form of children and adults, who clarify the distinct features of the product, in order to attract viewers. The commercial also uses its established brand name not only to attract children but adults as well, by bringing back memories of their childhood. The product is also shown on the Kraft Food homepage to provide additional information. â€Å"Suchard Express† is the second brand provided by Kraft Food. Just like the Kaba product Suchard Express is a food pow der containing 18% of cocoa. The product is purchasable as 500g package and 14. 5g portion bags with an average cost of 0. 41â‚ ¬ per 100 g unit. The product is not directly supported by any marketing promotion but in relation with other Kraft Food products. As its predecessors, â€Å"Kaba† and â€Å"Suchard Express† are distributed in food retailing. Further competing products are provided by Niederegger (Niederegger Trinkschokolade), RUF Lebensmittelwerk KG (natreen) and Kruger GmbH (Moreno). 3. 3SWOT Analysis The SWOT-Analysis is an efficient tool to enable a transparent insight of the current product standpoint. The analysis contains strengths, weaknesses, opportunities as well as threats within a certain market. In this case, it is the market of cocoa drinks. The following analysis is regarding the standpoint of â€Å"Cocoa Jewels† within the cocoa market. Strengths ?Operating in a nice market ?Brand name without prejudice ?Product features ?Avoiding Head-to-Head competitionWeaknesses ?Comparable high price ?Unknown brand name ?Low profit margin Opportunities ?High cocoa consume in Europe and Switzerland ?Create increased demand for healthy and exclusive cocoa products Threats ?High market competition ?Larger competitors might target the niche market Economic situation impedes demand for expensive cocoa products 4Objectives In order to launch a new product we need to clearly define our objectives which are to find a niche product, to expand, to create a strong brand, to popularize â€Å"Cocoa Jewels† and to build market share. 4. 1Niche product The market our company is operat ing in is the consumer market and our product intends to fill a niche in the market for cocoa products. â€Å"Cocoa Jewels† respond to cocoa consumers whose needs are insufficient met by current competitors. Our goal is to create a product which no competitor produces and therefore fits perfectly into a market niche. This will lead us to entrepreneurial success. 4. 2Expansion At first â€Å"Cocoa Jewels† will only be available in Germany, so we can make sure that our product fills a market niche as expected. We are using the waterfall strategy, which means gaining market share in the local market (German market) and afterwards expanding to foreign markets. Before expanding we have to carefully analyse foreign markets by looking at the market potentials, consumer behaviours, levels of competition, market risks. Our strategy is to first of all open up markets which are most similar to the German market. Therefore, we will expand into European countries and at first to Switzerland because it has the highest chocolate consumption. Our final goal is to become successful worldwide. 4. 3Creation of strong brand Consumers tend to trust strong brands; therefore we have to create a strong brand image. Our customers should link positive memories, favourable and unique associations with our brand. Therefore they will buy our product instead of those of the competitors. Successful brand building can reap benefits by achieving distribution more readily, sustaining high and stable sales and profits through brand loyalty. . 4Popularise the product â€Å"Cocoa Jewels† should be a product that? s popular among our target audience- If the acceptance is high they will tell their friends and family members about it which expands our target audience. With this advertising strategy we will achieve an increase of our awareness level. 4. 5Built market share We also have no immediate competitors, be cause nobody offers a product that is equal to ours. We have a market volume which is not filled with adversarial market share. With these requirements it is easier for our company to build up market share. We hope to maintain in a tightened position before competitors enter the market with equal or similar products. We should have built up a market share which no competitor can challenge with. 5Target group We are creating a high standard product and therefore targeting customers with a high standard lifestyle who are willing to spend more money for quality products. This target audience is often depending on the brand and image of products and therefore they have a high potential fidelity that we should exploit. Moreover, we are producing a sugar free drink which mainly women are attracted to. The health-driven woman is very concerned about her alimentation and her weight. Therefore these women chose their food very carefully. They are often concerned about less fat and less sugar, which protects her from gaining weight. Therewith we are offering them a product that fulfils their needs which are full-taste of chocolate with less or no sugar. To reach these customers we will put in place an adapted marketing strategy: attractive, innovative, high standard characteristics, a relatively high price, a selective distribution and promotion. 6Marketing mix 6. 1Product Our core product is a sugar free hot cocoa mix, which is melting in a hot liquid. It is offered in a solid body, which is melting in water as well as in milk. Agitate your drink a few times and enjoy drinking. One can also enjoy it like a confection of cocoa which applies to the tangible product. â€Å"Cocoa Jewels† are in the shape of a globe with a diameter of 1,5 cm. They are packed in a very elegant and classy wooden box, which guarantees an easy and professional storage. This is needed because our globes should not be exposed to direct sunlight and they should be stored dry, in case of melting. One box comprehends 32 globes. Every wooden box weighs 350grams and it is comprised of two tiers with 16 globes. Every globe weighs 11grams. â€Å"Cocoa Jewels† give our Customers the opportunity to choose how intense they like their drink. They can choose how much globes they put in a glass, because the taste of people often differ. One globe consists to two- thirds of cocoa, which is our main ingredient. This is a big competitive advantage because our product includes almost twice as much original cocoa then competitive products. Another advantage of our product is that it contains no sugar. Therefore our product can be considered to be healthier than other cocoa products which contain a lot of sugar. We offer our customers no after sales service because it is not usual in the food industry to provide any after sales service or similar things. However, we offer them two opportunities to contact us. First of all we offer them a customer hotline and second, an e-mail address both printed on our package and published on our web site. On these platforms customers have the chance to ask questions and tell us their suggestions, wishes and afflictions. In addition we give no warranties on our product because money-back guarantee doesn? make sense while our product doesn? t improve the health or other things. A great benefit of our product is that it is variable because we can change the flavor from cocoa to vanilla or strawberry. This gives our company the chance to innovate and create new products out of the already existing product. Therefore we can boost our position on the new markets. 6. 2Price When it comes to pricing our product, there are three different approaches one can adopt to set a price. Besides the cost-orientated pricing and the competitor-orientated pricing we apply the marketing-orientated pricing for our sugar free â€Å"Cocoa Jewels†. Compared to the cost-orientated and competitor-orientated pricing we can assure to take a much wider range of factors into account in order to define the most efficient price for our â€Å"Cocoa Jewels†. There are five factors which need to be considered intensively before setting a price. In the following we are going to take a closer look at these five price indicators: 6. 2. 1Marketing Strategy In order to assure a successful launch of our new product we need to be sure about our positioning and launching strategy. Our strategic aim is to position our product in the high-price market segment. In order to enter this segment we have two possible options: the rapid skimming and the slow skimming. Rapid skimming combines a high price with high promotion expenditure. The heavy promotion creates high levels of product awareness and knowledge, the high price delivers high margin returns. A slow skimming strategy combines high prices with low levels of promotional spending. We are choosing the rapid skimming strategy for our product to enter the high-price market segment. Although rapid skimming is associated with high promotional expenditure it is the most effective way to make customers aware of our new product. In order to enter the high-price market with the rapid skimming strategy there are several characteristics which need to be considered: â€Å"Cocoa Jewels† provide a high value to the customer due to the special characteristics our product offers. The fact that our â€Å"Cocoa Jewels† are sugar free is the most important value for our customers because our target group of the health-driven woman is very concerned about her alimentation and lifestyle. Therefore she is willing to pay a higher price for our product which offers a â€Å"healthy pleasure† because it is sugar free. Price can also be seen as an indicator of quality. With our promotional message we are creating an image of high quality. When customers buy our product they need to experience a pleasure, in fact they will be satisfied consuming it. This leads to the fact that our high price is legitimated both buying and drinking â€Å"Cocoa Jewels†. 6. 2. 2Competition Another important pricing indicator is the competition we are facing on the market we want to enter. Our recent market research has shown that our product is entering a niche market. Due to its unique characteristics there are no immediate competitors on the European market. However, there exists a high amount of products similar to our â€Å"Cocoa Jewels†. Although these competitors are offering their product in a powder form and at a lower price we need to stick to our higher price in order to become a high-price and high-quality product. 6. 2. 3Value to customer As mentioned above our product meets the needs of our target group. The main factors for customers to make their cocoa drink buying decision are the price in relation to the quality, the taste, the comfortable use and the brand image. â€Å"Cocoa Jewels† covers all four decision makers. Due to the high rate of cocoa (two-thirds) the drinks are more creamy and delicious. This goes along with the high quality we offer. Through our promotion we are going to create a strong brand image in our customers mind. These three facts lead to the acceptance of a higher price. 6. 2. 4Costs Another important fact we need to consider are the costs. Although we do not apply the cost-orientated pricing we need to determine that our margins cover the expenditures. Due to the special shape and the high-quality packaging our production cost will definitely be higher as the production cost of our competitors. Even though we need to cover our expenditures we cannot set an utopian price. In our research we analyzed the prices of our competitors. Our main competitors sell their cocoa products from a price of 0,39â‚ ¬ to 1,16â‚ ¬ per 100g. In order to pursuit our strategic aim of entering the high-price segment we will launch our product at a price 1,43â‚ ¬ per 100 grams. This price will cover our expenditures. The spending on promotion, research, production and distribution capture 93% of our price. The remaining 7% are our planed profit margin. 6. 2. 5Negotiation margin As we enter the market with the rapid skimming strategy, we provide high prices right from the beginning. We want our customers to associate â€Å"Cocoa Jewels† with high-quality, healthy pleasure, uniqueness and exclusiveness. Therefore we are not planning on any discounts or price decreases in order to attract customers. The goal is to bind our customers by creating a product awareness, followed by consumption and final acquisition of their loyalty due to the specific product features such as sugar free and high amount of cocoa (two-third). 6. 3Place 6. 3. 1Distribution Strategy As we are launching an exclusive product and want to enter the market as a high quality brand, our distribution strategy needs to be adapted to this goal. Therefore we chose to commercialize our product with two different retailer types: First in delicatessen stores such as Kafer and high standard chocolate stores like Bitter Zart. Second, in order to reach a higher number of potential customers we also want to be present in upper-grade supermarkets such as Migros, Kaufland and Real. 6. 3. 2Type of channel distribution On the business-to-consumer market distribution is either direct or indirect. Direct distribution means that the producer supplies the consumer without any intermediary. By indirect distribution the product passes through one or several intermediates (Wholesaler, Retailer) before it will be offered to the customer. We are using the indirect distribution, because as we are commercializing a single product and not a large product mix (direct distribution appears ineffective). Besides the nature of our product is more adapted to indirect distribution, because a drink preparation mix doesn’t request any close contact between producer and customer and doesn? represent any handling difficulties for our distributors. As we don’t have any direct competitors we want to insist on the innovative characters of our product in order to compete with traditional cocoa preparation mixes using the same distribution channels. Therefore we don’t see the use of innovative direct distribution strategy. 6. 3. 3Channel selection As we chose to produce an exclusiv e product our target audience has particular expectations. They are willing to buy in nice conditions, in places they associate with high quality. Delicatessen stores are particularly adapted because they offer great service and allow the customer to get information about our product and its unusual shape while buying in a particular ambience. However, as we are commercializing a product which is always bought in small quantities we need to reach a large number of customers. Therefore we want to enter the market with supermarkets. Besides, supermarkets are a good way to reach women which are our principle target customers. As we want to commercialize an innovative product we are hoping that supermarkets and delicatessen will accept our product and will be willing to sell it. . 3. 4Distribution intensity Another decision we have to make is the intensity of distribution. There are three possibilities: (1) intensive distribution; is the use of all available outlets, (2) selective distribution; the use of a limited number of selected outlets, (3) intensive distribution; the use of only one unique distributor. As we intend to become an up-market brand and still want to reach a relatively large number of customer we choose a selective distribution. To have a quality image, apart from the delicatessen, we want to select the best supermarkets and of course dismiss discount retailers. 6. 3. 5Channel integration There are three types of channel integration: (1) in conventional market channels an independent producer and independent distributors are working together, (2) distributors can be franchised, (3) the whole channel can be totally owned by the producer. As we are launching a new brand we are using a conventional marketing channel, without any short-term project of franchising or channel ownership. Our goal is to gain market share within and then outside Germany always using our chosen type of upper-market retailers. We are willing to create successful and long-term partnerships by considering the interests of our various partners. We are aware of small delicatessen stores and supermarkets having different expectations and functioning and that these two types of distribution channels will have to be managed differently. We also plan to evaluate each partnership after a few months of selling to make sure our channel selection was really adapted to our product. 6. 4Promotion In todays competitive world, organizations are using innovative and new ideas to stay a step ahead of their competitors. Brand identity and promotion help the organization to establish itself strongly in the market and to attract the potential target audience in large numbers. These are very important aspects of the marketing mix and the only way to inform the chosen target groups about the brand and its products. It keeps the product in the minds of the customers and helps stimulate demand for it. It is proven that people all over the world prefer to purchase branded products and they also do not mind paying a higher price for it. However, in order to create a brand identity and awareness of the product, there are many factors which need to be carefully analyzed and to be executed in the appropriate direction to gain maximum benefit. We are trying to achieve that with our product â€Å"Cocoa Jewels† with the following marketing plan: ? Create awareness and desire for the product ?Sampling ?Message decisions ?Media decisions 6. 4. 1Create awareness and desire for the product To stimulate our sales and to increase profit we need a clear understanding of its communication objectives. The first contact between our product and the target group must be well organized. Ideally the first contact creates desire for the product. One way to do that would be to allocate samples of our product and let the target audience try before they can decide to actually buy it. The sales of some products suffer because of lack of trial and marketing research has shown that once customers try the product the acceptance is very high. 6. 4. 2Sampling Samples of our product can be offered in e. g. grocery stores, drugstores, fitness studios and on the streets. Those locations are central points of contact of our target group. It is most likely that our potential customers frequently visit these locations. With allocating our samples in fitness studios and drugstores we can make sure that the message of a healthy (sugar free) product is sent to the right audience. Give it away on streets helps us to gain new costumers which are not necessarily visiting fitness studios or drugstores. Another possibility is to sell our product to internet platforms such as (e. g. ) trnd. com. This platform provides us to let costumers try our product and give us feedback on it, which brings many advantages along. First of all we can allocate our product to specifically chosen (by trnd) target groups and let them tell us how they like it without paying for test persons. Moreover if they like our product they will tell their neighbors, family members or friends about it which brings us word-of-mouth advertising. Therefore it is a very efficient way to do advertising without having high costs. 6. 4. 3Message decisions The advertising platforms (media) are the foundation on which advertising messages are built. They should be important to the target group because that will be the only way to reach them. We will now show what our platforms and message are going to be and how they approximately going to look like. First of all we need a certain advertising message. This message has to be translated to the media platforms with words, symbols and illustrations that speak to the target audience. David Ogilvy an advertising practitioner suggested that press advertisements should follow a number of guidelines: 1. The message appeal (benefit) should be important to the target audience. 2. The message should be couched in the customers? language, not the language of the advertiser. 3. The advertisement should have a headline that might: -Promise a benefit -Offer a service -Identify a problem Our message could therefore be the following:  «Ã¢â‚¬Å"Cocoa Jewelsâ€Å" purer Genuss hei? er Schokolade, auch ohne Zucker  » 6. 4. 4Media decisions 6. 4. 4. 1Television Television advertising is often used to build a brand personality. Therefore it is the best way to promote a new product most effectively. It has many advantages. Advertisers can demonstrate the product through motion. The capability of TV can combine color, movement and sound (unlike the press, posters and radio). TV is able to transfer an emotion that’s why it is often used when brand image building is required. This is what we try to achieve with our product. Although TV advertising is a transitory medium which means consumers can not refer back to the advertisement once it has been broadcasted it is also one of the most expensive ways to advertise. Nevertheless it is still one of the most efficient ways to build a sustainable brand image. With a TV commercial we can not only create the attention and interest for our product it helps also to create desire for it and at the final stage hopefully the action to buy it. The best place and time to broadcast our commercial and to reach our target audience would be at the late afternoon, which is mainly from 4pm to 9pm. The active health-driven woman is that person (how we consider our target audience to be) who actually buys our product. Nevertheless our TV commercial should also respond to the actual consumers. With creating a familiar atmosphere in our commercial we want to show that everyone can consume our products. With this strategy we can even aim to expand our target audience to other groups as well. 6. 4. 4. 2Print media The print media advertising is another very effective way to promote our product. Advantages of print media are that readers are in control of how long they want to assimilate information. They also have the possibility to re-examine the advertisement at a later date. Magazines such as â€Å"Shape†, â€Å"FitforFun† and â€Å"Woman’s Health† respond to our target audience which means it is the perfect way to reach them. Other magazins could also be â€Å"Brigitte†, â€Å"Freundin† and â€Å"Bild der Frau†. These magazines often have articles about dietary and healthy food. As mentioned above the health-driven woman is concerned about her alimentation and her weight so she specifically chooses her food carefully. Less sugar is always something she considers to be healthy and it protects her form gaining weight, but she doesn? want to abstain good taste. This is exactly what we want to express with our print media: healthy and non-fattening food, because sugar free, but with full taste of chocolate. Other press promotion would be advertising folders of food retailers. Therewith we can show our target audience where they can buy our product. 6. 4. 4. 3Internet The internet is a media platform that allo ws us global reach at relatively low cost. If our product has a high acceptance in Germany it might sweep over to other countries by web forums and websites. It also gives us the ability to measure the number of website visits and clicks on advertisement so therefore we can see if it? s profitable to spend money on internet advertising. Communication between supplier and consumer is possible either by website-based communication or on various web forums so that we can get feedback on our product. 7Conclusion In today? s world the market is over swept with new products. With the globalization of the economy competition is growing. The challenge is to create innovative products with differential advantages in comparison to those from the competitors. The