Introduction
Rob and Pablo, the co-proprietors of SNOG (a chain of U.K. based yogurt shops), mention that the secret behind their success lies not only in the type of product they sell but rather in the way in which they make each transaction an “experience” for their customers.
What these two entrepreneurs are referring to is the general ambiance and “feel” that permeates a particular store or shopping area. This paper will examine the origins of yogurt chain “Snog” and the various entrepreneurial activities and concepts that contributed to its success within the U.K. market.
Case Overview
The U.K. yogurt shop market reveals a high degree of market saturation with brands such as Frae, Itsu, Moosh, Snog, YUforia, Yog and Pinkberry all competing for a “slice” of the U.K. consumer market. Furthermore, each company has their own variation of yogurt with some shops such as Snog advocating the use of organic ingredients while others pursue an approach of having unique flavors and overall affordability (Birkett, 2009: 21).
With so many different stores and product variations already present in the U.K. market today this makes market penetration and the creation of sufficient brand awareness of a new yogurt shop all the more difficult to implement.
What is Snog?
The increasing awareness of health problems within the U.K. (such as obesity and diabetes) has contributed to a popular trend in many modern food products to target customers who want to derive health benefits from the products they consume.
It is based on this that the yogurt enterprise “SNOG “is dedicated to providing healthier yogurt than its competitors (i.e. Pinkberry) since it is fat-free and uses natural ingredients with a mixture of fresh fruits, nuts and organic yogurt.
Started by entrepreneurs Rob and Pablo, both men had come from diverse backgrounds yet were able to come together to start a coffee shop business concept that was quite successful and chose to branch out into other endeavors in their pursuit of a great entrepreneurial experience.
In a recent interview they talked about how they developed the initial concept of the shops interiors and the method of sweetening their products through the use of a sweetener importer from Mexico.
They explained how they realized success in during an economic downturn was possible by making their shop an “experience” rather than merely thinking of it as a shop and they even planned the happy ambiance that pervades most SNOG yogurt shops as a method of drawing people in and enhancing their purchasing experience.
When examining the interview it became apparent that the pilot-in-the plane principle was at work regarding the success that SNOG enjoys at the present. As it was mentioned earlier, the entrepreneurs took great pains in the planning process especially in terms of developing their brand image and this resulted in the popularity that SNOG enjoys today.
As Gilbert (2010) notes in his study examining the pilot-in-the plane principle the success of a business is directly tied to the course that an entrepreneur chooses to take, this can come in a variety of forms and result in a plethora of different outcomes however in the end what determines success or failure is how entrepreneurs choose to guide their business and deal with the ramifications of their actions (Gilbert, 2010:83 – 91).
Based on this it can be stated that proper planning and sticking to a business concept that places an emphasis on brand image and stability can result in a stable and profitable company (Picker, 1993: 19).
Environmental Factors
Making it into an experience
Rob and Pablo state the following regarding what it takes to become a successful entrepreneur “now we are in a recession and we see businesses that are successful, I think the one thing you see that they all have is a form of experience for their customers which is the most important part in everything, so we made sure that there was an experience at Snog”. The “experience” that Rob and Pablo are referring is not just the quality of the product itself but what customers feel when they enter into a particular establishment.
In the case of Snog all their outlets have a warm and friendly ambiance which is not only family friendly but actually promotes, in their words, “a happy feeling” for customers. For example, it can be seen that in the case of Apple Inc. (which is considered the world’s most valuable company) all their stores, no matter what country they are present in, have a stylish and ergonomic design that looks “clean, modern and cutting edge” which has come to exemplify the experience of buying products at an Apple store.
Based on the popularity of not only Snog but of Apple itself it can be seen that by making their store into an “experience” rather than just a store this helps to encourage buying behavior among their clientele and even repeat visits. As such for any business that wants to increase their customer base it is important to develop the experience their venue provides so as to better appeal to consumers and create repeat business (Heap, Chua, & Dornhofer, 2005: 85-88).
Translating the Idea into an Opportunity
The following is an example of the process utilized by Rob and Pablo in their examination of the U.K. market and how a yogurt shop that focuses on healthy offerings and a friendly ambiance can result in a viable business.
Market Examination
Dobson & Chakraborty (2008) in their examination of consumer trends within U.K. in the past 3 years has noted that people are generally becoming more self-conscious regarding their health and physical appearance (Dobson & Chakraborty, 2008: 333 -341).
While Dobson & Chakraborty (2008) do not precisely indicate whether this is the result of health awareness campaigns or the mass media Dobson & Chakraborty (2008) does recommend that strategies in targeting today’s “brand of consumer” should therefore concentrate on campaigns and the creation of consumer products that emphasize “no fat, no cholesterol and with comparatively low calories” (Dobson & Chakraborty, 2008: 333 -341).
It must also be noted that Beattie, Dhanani & Jones (2008) has noted a distinct increase in the amount of consumers that have a greater degree of awareness regarding environmental and social responsibility. As Beattie, Dhanani & Jones (2008) states, “consumer trends in product and service patronage have been changing as of late towards companies who are involved or promote donations, recycling and preservation of the environment” (Beattie, Dhanani & Jones, 2008: 181 – 219).
How They Coped with Risk and Uncertainty
Focusing on Brand Image
Further examination of the methods employed by Rob and Pablo in coping with uncertainty and risk reveals that they placed a heavy emphasis on brand image and how this generated a great deal of consumer interest for their yogurt store. Evidence of this can be seen in the very name they chose for their shop which is synonymous with the act of kissing within British culture.
By creating a slight bit of controversy with the name they chose, the entrepreneurs were able to generate a significant amount of public interest which they converted into the very way in which the brand itself is correlated with something that is pleasant, exciting, spine tingling and above all interesting.
This is in direct contrast to the methods employed by other yogurt stores which focus more on “traditional” methods of brand formulation. This creates a certain advantage for Snog which has enabled the company to survive in an overly saturated yogurt store market and gives it a certain level of distinction as compared to the other brands available.
As Neganova & Neganova (2011) explains, a company’s brand image helps to enamor it to customers in that through a distinctive way of presenting the company’s products and services this enables it to distinguish itself from its competitors (Neganova & Neganova, 2011: 261-266).
On the other hand Neuts (2011) explains that a brand image can also be utilized to popularize a company among a particular consumer demographic in that through the uniqueness of the brand image a consumer continues to remember the company and its brand long after the initial consumption of a product or use of a service from that company (Neuts, 2011: 80).
Examples of this can be seen in the brand image utilized by U.S. based Apple Inc. which has quite literally developed a cult following among millions of international consumers today (Barr & Wright, 2010: 1-9). They did this by facilitating a brand image of distinctiveness and quality and further enhanced this by providing innovative products that subsequently created a whole new trend in ergonomic design, stylish looks and above all advanced technological capability (Chandler et al., 2011: 375-390).
Within the Middle East the telecommunication company Du which is based in the U.A.E has challenged the monopoly of Etisilat (a major internet and telephone provider which has been based in the U.A.E for decades) by providing cheaper services, better phones and above all as a new and “hip” brand image which has greatly facilitated greater consumer demand for Du’s services (Masurel et al., 2002: 238).
Another example can be seen in the case of the Philippines within South East Asia where the outsourcing company Convergys has in effect popularized jobs related to the customer service sector by presenting them in such a way that they appeal to new graduates of local colleges within the country (Prahalad & Mashelkar, 2010: 132-141).
These and other examples too numerous to mention show the importance of developing a particular brand image in order to entice consumers, win over potential employees or stay ahead of the competition (Hitt et al., 2011: 57-75). As such it is recommended for any company, newly established or not, to develop a brand image that appeals to the market segment they are targeting so as to facilitate a greater market share for the company.
Focusing on Store Locations
Another strategy employed by Rob and Pablo was to ensure that all Snog stores were placed in locations that have high pedestrian traffic so as to maximize the amount of people that take interest in the ambiance of the store and its product offerings.
The pedestrian traffic alone that goes through Brewer Street on a daily basis is incentive enough to establish a store in such a location and makes the Snog shop there ideally placed in being able to take advantage of the daily pedestrian traffic in order to popularize the store’s image and offerings through various window displays and offerings on the street.
It must also be noted that aside from the number of people that traverse Brewer Street on a daily basis the location itself is home to a variety of commercial areas such as department stores, food chains, restaurants, snack bars, fashion boutiques, etc which creates a spillover effect wherein people who finish their shopping from one store can go to Snog in order to rest and relax.
My Entrepreneurial Profile
In terms of the experience I have just undertaken in this project I have come to realize that there is more to entrepreneurship that just creating an effective product or service, rather it is necessary to develop a product’s branding, method of sales and consumer interaction. In fact when taking all the facts mentioned into consideration it becomes obvious that what I know now is still woefully inadequate in terms of being able to successfully establish my own business.
I still need more experience in terms of understanding markets, determining what works and what will not. I need to be able to make mistakes in order to learn from them and as such I believe that it is necessary that I learn under more entrepreneurs in the future in order to understand what they did and the mistakes they made so as to avoid making them in the future.
I plan to utilize this to my advantage by talking to as many entrepreneurs as I can, expand my current network and attempt to determine what the market needs and how I can provide it. By doing so I believe I can become a great entrepreneur and as such I owe a lot to this current project in enabling me to see what is necessary in creating an effective business endeavor.
Enhancing my Entrepreneurial Capabilities
All business endeavors have a certain degree of risk which can come from the interaction of businesses with market forces yet entrepreneurs can limit the amount of risk they are exposed to by taking the proper steps to ensure that their business stands on a solid and stable platform which acts as the best insulator there is against market risks (Farber, 2008: 73).
As a student taking up this entrepreneurial course I have been taught numerous lessons which I believe will help me in my future entrepreneurial activities and as such I believe this gives me a distinct advantage over other people in the same career that have not received the same level of educational quality I have.
Lessons I learned:
Focus on Quality
One of the most important factors in creating and maintaining a successful business is a focus on quality and ensuring that any product bought by a customer is not the result of inferior production or workmanship.
What must be understood is that customers tend to patronize businesses that show that they care about their customer by ensuring the strictest measures are followed in product quality (Baum & Bird, 2010: 397 – 412). In instances where a company has failed to live up to the expectations of consumers regarding the overall quality of a product it is often seen that such companies tend to lose customers in droves (Baum & Bird, 2010: 397 – 412).
This was seen in various technology companies such as Dell that neglected to implement proper quality control measures on its motherboards resulting in several computers being sold whose motherboards leaked chemicals when overheated.
Such a fiasco was a nightmare for Dell and ruined its reputation with several of its customers in effect sending them to other companies as a result. It is based on this that it can be seen that a focus on quality is an important aspect for any company to follow in order to grow and maintain its consumer base.
Adapting to Changes in Business Environments
Another factor that businesses should take into consideration is adapting to changes within local business environments. What must be understood is that businesses don’t operate within a vacuum and as such it becomes necessary to observe that occurs within local business environments and respond accordingly (Chell & Baines, 2000: 195-215).
This can come in the form of expanding during times of economic prosperity or cutting back and outsourcing specific aspects of the company’s operations during lean economic times. Not only that, companies should be prepared to respond to changing consumer trends in order to stay relevant lest they fall into obscurity and stagnation (Chell & Baines, 2000: 195-215).
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