Sstrategic Marketing Plan Trategic Marketing Plan

S trategic Marketing Plan

Team C
Kate Borchardt
Katso Bureman
Matt Fenske
Carly Hedlin
Genette Sekse
2

Executive Summary

Compatible Technology International (CTI) is a nonprofit organization which alleviates hunger and
poverty in the developing world by designing and distributing food and water technologies. CTI’s goal is
to market and sell their Ewing III and Omega VI grinders in the United States for profit in order to earn
revenue to support their mission in the developing worlds. CTI has had very little experience in
marketing and selling their grinders for profit in the United States but they do have a marketing system
in place to raise funds and promote their mission of alleviating hunger and poverty in the developing
world which they will be able to use to support this new for profit venture. CTI’s competitive advantage
comes from the social cause associated with purchasing a grinder and the durability and longevity of the
product itself. Through a current market assessment, primary market research, environment analysis,
competitive analysis, SWOT analysis and a STP analysis it was determined that small scale producers
(which includes small farmers, hobby farmers, and small organic farmers) are the target market for this
product. Key features of the product to emphasize are its long life and the philanthropic benefit that
comes with purchasing a grinder. The internet, farmers markets, and trade shows and conferences are
all excellent places to begin marketing CTI grinders. Additionally, social media, magazines, word of
mouth and CTI’s own website, brochures and newsletter provide excellent promotional opportunities.
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Table of Contents
Company Overview...................................................................................................................................... 5
Compatible Technology International ..................................................................................................... 5
Mission .................................................................................................................................................... 5
Objectives/Goals...................................................................................................................................... 5
Sustainable Competitive Advantage........................................................................................................ 5
Assessment of Current Marketing Strategy................................................................................................. 5
Primary Market Research ............................................................................................................................ 6
Environment Analysis (CDSTEP)................................................................................................................... 7
Culture ..................................................................................................................................................... 7
Demographics.......................................................................................................................................... 8
Social........................................................................................................................................................ 9
Technology ............................................................................................................................................ 10
Economy ................................................................................................................................................ 11
Political/Legal ........................................................................................................................................ 11
Competitive Analysis ................................................................................................................................. 11
SWOT Analysis ........................................................................................................................................... 12
Strengths................................................................................................................................................ 12
Weaknesses ........................................................................................................................................... 13
Opportunities......................................................................................................................................... 13
Threats................................................................................................................................................... 13
STP Analysis ............................................................................................................................................... 14
Segmentation ........................................................................................................................................ 14
Targeting................................................................................................................................................ 16
Positioning ............................................................................................................................................. 17
Marketing Mix ........................................................................................................................................... 17
Product .................................................................................................................................................. 17
Place ...................................................................................................................................................... 20
Price ....................................................................................................................................................... 21
Promotion.............................................................................................................................................. 22
Implementation Strategy........................................................................................................................... 23
4

Contingency Plan ................................................................................................................................... 24

Financials ............................................................................................................................................... 24
Measures of Success.............................................................................................................................. 25
Figures ....................................................................................................................................................... 26
Figure 1 .................................................................................................................................................. 26
Figure 2 .................................................................................................................................................. 26
Figure 3 .................................................................................................................................................. 27
Figure 4 .................................................................................................................................................. 28
Figure 5 .................................................................................................................................................. 29

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Company Overview

Compatible Technology International
CTI is a nonprofit organization that alleviates hunger and poverty in the developing world by designing
and distributing simple, life-‐changing food and water technologies. CTI’s goal is to sell grinders in the
United States for profit in order to earn revenue to support their mission in the developing worlds. The
products that are grown in the U.S. and can be used in the grinder include; Wheat, oats (after hulling),
sorghum, millet, corn (dry), roasted soy beans, roasted coffee beans, roasted cocoa beans, flax, barley,
rye, sesame, barley, and dried leaves such as oregano and parsley and some dried vegetables such as
potatoes and yucca. It can also hull rice with a special burr attachment.
Mission
CTI’s mission is stated as, “Working to relieve hunger and poverty in developing countries by
designing food and water technologies that are sustainable and appropriate to local cultures and
collaborating with in-‐country organizations to identify needs and to achieve widespread use of our
technologies.”

Objectives/Goals
Market and sell grinders in the United States for profit to earn revenue to support their mission in the
developing world.

Sustainable Competitive Advantage
CTI has a strong competitive advantage over other grinder producing companies due the philanthropic
benefit that comes with purchasing a CTI grinder. Upon purchasing a CTI grinder, consumers
immediately know that their purchasing dollars will aid CTI’s charitable grinder program which will
improve the life of someone else who is less well-‐off then themselves. This is an example of a case/issue
that the company is specifically addressing (international hunger). While CTI grinders fulfill functional
needs of consumers, the psychological needs of helping others can be a significant determinate
attribute when comparing a CTI grinder to another company’s grinder. Additionally, the grinder is very
high quality and durable.

Assessment of Current Marketing Strategy
Currently, CTI does not market their grinders for sale in the U.S. A number of individuals have
approached CTI to purchase a grinder for their own personal use but this has not been the result of a
direct attempt by CTI to market their grinders for profit. CTI has sold seven grinders to organic farmers
and Mennonite/Amish people in the past. CTI does, however, have a marketing system in place to raise
funds and promote their mission of alleviating hunger and poverty in the developing world. CTI will be
able to use some of their existing marketing materials such as their website and brochures to aid in
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marketing this new for profit venture. Additionally, CTI is able to effectively promote the difference that
their grinders and other technologies make in individuals’ lives in developing countries. This strategy can
be adopted to aid in the marketing of grinders in the U.S.

Primary Market Research
Personal interviews were used to conduct primary market research. Finding people who were willing to
be interviewed and/or felt grinders were relevant to them proved to be difficult. Numerous people were
contacted but only four personal interviews could be conducted.

Charli Mills, Marketing Communications Manager, Valley Natural Foods
Charli Mills is the Marketing and Communications Mangers for Valley Natural Foods, a member owned
cooperative in Burnsville, MN. As an experienced marketer in the organic and natural foods industry,
Mills explained that small farmers would be most likely to use a grinder that would enable them to
create a value-‐added product from their crops. Additionally, Mills explained that trade association
shows and conferences would be an excellent place to promote CTI grinders, as well as farmer’s
markets. Mills also mentioned that winter is the season when farmers have the most time available to
them to attend these sort of conferences and shows. She also mentioned the Midtown Global Market
could be a potential opportunity to market to home users. When asked about the cost of CTI grinders,
Mills felt that the $300-‐$400 price tag would not be unreasonable for small farmers. She added that
grants from USDA Rural Development may be available to farmers to help with the cost of purchasing a
grinder. If there are grants available, CTI could publicize the available grants with their grinders and help
farmers with the grant application process. Mill also saw a potential opportunity in promoting the social
cause associated with CTI grinders.

Darrold Glanville, Owner, Sunrise Flour Mill
Darrold Glanville is the owner of Sunrise Flour Mill, a boutique flour mill, in North Branch, M N. Glanville
purchased a grinder from CTI and plans to use it to grind corn. He currently sells various stone burr mills
and is considering purchasing CTI metal grinders to resell. He explained that an advantage that metal
grinders have over stone grinders is their ability to grind oily products like peanuts and herbs. He also
mentioned that CS Bell Co. should be looked at to get a good idea of all the uses and industries for
grinders.

Danny Schwartzman, Owner, Common Roots Café
Danny Schwartzman is the owner of Common Roots Café in Minneapolis, MN. Common Roots is café
which uses local and organic ingredients in all their products. Schwartzman explained that his café
would not have a use for a grinder. The café gets their grains from Whole Grain Milling, a local micro mill
that built their own grinder. He also didn’t think other cafes like his would be interested in using a
grinder other than possibly grinding coffee beans. His café already has an electric coffee bean grinder.
Schwartzman did, however, think that small farmers could be a potential user of the grinders. He
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recommended specialty organic conferences and trade shows as a place to market the grinders. He also
mentioned that winter is the time when most of these conferences occur because winter is the time of
year in which farmers have more down time.

Greg Reynolds, Owner, Riverbend Farm
Greg Reynolds is the owner of Riverbend Farm near Delano, MN. Riverbend Farm is an organic produce
farm. Danny Schwartzman recommended speaking to Greg Reynolds because Reynolds uses a hand
crank mill to make his own polenta. Reynolds explained that there are currently two markets for hand
cranked grinders – home users and small scale producers. He expressed concern that hand crank
grinders and even small electric powered grinders are not viable options for small scale producers
because the time required to grind the product would make the product too expensive for anyone to
buy. He mentioned that Amish people, Green Wizards, and Transition Towns would be “natural” users of
this product.

Primary Market Research Conclusions
• Small farmers and small scale producers are a market for grinders
o Although, Greg Reynolds comments about the viability of hand crank grinders for small
scale producers are cause for concern
• Trade Association shows , specialty conferences, and farmer’s markets are opportunities to
both gather more industry research and market CTI grinders
o The winter season would be the best time to do this
• Cafes and restaurants do not seem to be a market for grinders
o There is a possibility to that cafes may be interested in using the grinders to grind coffee
but there are many other coffee grinders, especially more efficient electric coffee
grinders, available on the market.
• There is the potential to sell grinders to other businesses that will resell the grinders
• The philanthropic cause and concerns associated with purchasing a grinder from CTI are
opportunities for CTI

Environment Analysis (CDSTEP)

Culture
• An unfortunate recent cultural trend in America is obesity1. This epidemic has prompted vast
promotional efforts showcasing living and eating “healthier” as the best solution, including a
national effort targeting childhood obesity by The First Lady called Let’s Move2. CTI grinders can
be used to create healthy foods.

1
http://www.cdc.gov/obesity/data/index.html
2
http://www.letsmove.gov/
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• A more positive recent trend is support for health and the environment. Many Americans value
healthy and environmentally friendly products. CTI grinders work without electricity or harm to
the environment and can be used to create healthy products. Additionally, purchasing a grinder
helps support CTI’s mission in the developing world.
o According to the Organic Consumer Association, 30% of those surveyed seek healthy
eco-‐friendly products. Of them 75% say their purchasing decision is based on the health
and sustainability of the environment and world.3
Demographics
• Farmers (in general)

4
o In 2007, there were 2,204,792 farms in the US.
• Organic Farmers5
o As of 2008, there are nearly 15,000 farms in the US that the USDA has certified as
organic.
o Most producers sell products locally
• Small scale farming
6
o In 2007, small farms accounted for 91% of all farms in the US.
7
o Farms with annual sales less than $10,000 account for 60% of farms in the US (see
figure 1)
o Farms with annual sales between $10,000 and $99,999 account for 24% of the farms in
the U.S.8 (see figure 1)
9
o Small farmers on average are male, white, and 57 years old. (see figure 2)
o See figure 3 for % of products produced by small farmers
o The National Sustainable Agriculture Information Service explains that creating value
added products is a strategy to keep farming operations viable.10
• Number of Farms are growing in the U.S.
o USDA Census reports that between 2002 and 2007 the number of farms grew 4% after
previous decades with no growth11
• The number of Hobby Farms are growing
o John Ikerd, professor of Agriculture Economics at University of Missouri -‐ Columbia
explains that the largest increase in farm numbers from 2002-‐2007 came from farms
with annual sales less than $1,000 which are hobby farms. 12

3
http://www.organicconsumers.org/Organic/ecofriendlyMay02.cfm

4
http://www.agcensus.usda.gov
5
6
7
http://www.agcensus.usda.gov/Publications/2007/Online_Highlights/Fact_Sheets/small_farm.pdf
8
9
10
http://attra.ncat.org/attra-‐pub/PDF/grainpro.pdf
11
http://web.missouri.edu/ikerdj/papers/SFT-‐New%20Farmers%20-‐%20USDA%20Census.htm
12
http://web.missouri.edu/ikerdj/papers/SFT-‐New%20Farmers%20-‐%20USDA%20Census.htm
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• Amish
A total population of 249,000, in 28 states and Ontario13.
o
• Organic food purchasers14 (see figure 3)
o Most “heavy” organic food purchasers are college educated, between 50-‐64, live in the
western United States, and are white.
o Most “medium” organic food purchasers are college educated or have some college
experience, between 50-‐64, live in the southern United States, and are white
• Organic food sales by product15 (see figure 4)
o Bread and Grains make up 11% of U.S. organic food sales
Social
• The “organic” food industry has grown dramatically in recent years due to an increased social
movement to eat healthier in order to live healthier.
o The Hartman Group reports that 73% of the U.S. population consumes organic food or
beverages at least occasionally.16
o The Hartman Group also found that consumers buy organic because it tastes better, has
environmental benefits and because it is healthier.17
o USDA Economic Research Service reports that organic food sales have grown 17-‐20% in
the past few years while conventional food sales have only grown 2-‐3%18
o The sale of organic agricultural products generated $ 1.7 billion in income for farmers in
2007. 19
o 38.4% of all U.S. organic sales was from California, followed by Washington and
Oregon.20
• The concept of “green living” has opened the door for an entirely new “green market.” CTI fits
into this “green market” due to the fact that its grinders are manually operated instead of gas or
electric.
o Bloomberg Business week reports that 32% of North Americans surveyed said they seek
out and purchase green products.21
• Studies have shown that people are more willing to give when they see and hear an individual’s
story versus an organization’s goal. 22 CTI’s goal is to help end hunger abroad and it has decided

13
http://www.huffingtonpost.com
14
http://www.choicesmagazine.org/2007-‐2/grabbag/2007-‐2-‐05.htm
15
http://www.choicesmagazine.org/2007-‐2/grabbag/2007-‐2-‐05.htm

16
http://www.hartman-‐group.com/hartbeat/who-‐buying-‐organic-‐demographics-‐2006
17
18
http://www.ers.usda.gov/publications/aib777/
19
20
http://www.ers.usda.gov/publications/aib777/
21
http://www.businessweek.com/careers/managementiq/archives/2009/02/consumers_still_going_green.html
22
http://mashable.com/2009/12/22/social-‐good-‐trends/

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to use all of its domestic market profit to serve this cause even more. However, CTI does a
wonderful job using its website to showcase personal stories from abroad about how their
grinders have improved people’s lives. CTI does a good job of this already but they can be even
more effective at promoting this aspect of the company when they sell their product
domestically.
23
• A product that is associated with a social cause adds value for consumers.
o According to a Cone’s Cause Evolution Study 2010:
 83% of Americans wish more products, services, and retailers would support a
cause
 40% said they bought a product because it was associated with a cause. This is
twice as many as in 1993.
• Consumers think companies should address economic development and hunger issues
• In fact according to the Cone’s Cause Evolution Study 2010, 80% of those
surveyed said companies should address economic development and 77% said
they should address hunger
• One of the best methods of product promotion is through word of mouth. Consumers constantly
utilize reference groups (Friends, family, etc) to gain knowledge of a product’s potential value.24
By targeting a specific market segment, consumers’ opinions of products are passed from one
person to another within a segment’s community. CTI hopes to tap into targeted segments of
consumers who will spread a positive reputation about their product, as well as awareness of
CTI’s mission in the developing worlds.

Technology
• The Internet has become an increasingly active place for consumers to shop. Many grinder
manufactures sell their products on numerous websites and CTI would be smart to do the
same.25
• When comparing a non-‐essential higher priced item versus a lower priced item, consumers who
purchase the higher priced item generally expect a higher level of quality and performance from
their more expensive purchase. CTI grinders are manufactured with durable, quality, materials
which add value to the product and help justify the cost in consumer’s minds26
• Many grinders in the market are much more technologically advanced than CTI’s grinders,
including those that run on electricity, or allow for a greater variety of food producing.

23
http://www.coneinc.com/2010-‐cone-‐cause-‐evolution-‐study
24
Grewal, Dhruv, and Michael Levy. Marketing. Boston: McGraw-‐Hill Irwin, 2010. Print.
25
See Shopping Results on Google to view amount of Grinders available for purchase on the internet -
http://www.google.com/search?client=safari&rls=en&q=food+grinder&ie=UTF-‐8&oe=UTF-‐
8#sclient=psy&hl=en&safe=active&client=safari&rls=en&biw=1023&bih=631&tbs=shop:1&q=manual+food+grinde
r&aq=f&aqi=g1&aql=f&oq=&gs_rfai=&pbx=1&fp=4af02a4ef0e10fb4
26
Grewal, Dhruv, and Michael Levy. Marketing. Boston: McGraw-‐Hill Irwin, 2010. Print. Pg 319.
11

Economy
• Consumers continue to rate the economy as poor but starting in October the Discover
Consumer Spending Monitor reported that consumer confidence is slowly increasing.27
• Farming as a business is somewhat precarious. Crop prices fluctuate, weather and insects
threaten crops, and getting hurt on the job can mean selling the family farm. The recent state of
the economy has made the sustainability of farming especially unpredictable.
28
o USDA predicted that farmers’ profits would fall by 38% due to the recession
• Consumers perceive more value in a product if they receive “more product” for the listed
price.29 Basically, consumers want to get “more bang for their buck.” CTI would be smart to
include additional incentives with the purchase of a CTI grinder.
Political/Legal
• There is possible grant money available for farmers from USDA rural development which can
help purchase value added products30
• For a finished agricultural product to be considered organic it must be certified by the USDA.
Legal processes must be followed to achieve this accreditation through the USDA.31
Competitive Analysis
• Products are continually being developed which are both more technologically advanced when
compared with CTI grinders, and can offer other additional food producing features which CTI
grinders do not. While this does threaten CTI’s market segment, the determinant attributes of
our product are more in-‐sync with CTI’s target consumers.
o For example CS Bell Co., an experienced company established in 1858, produces and
sells a variety of different grinders for multiple different industries
• The Internet makes it very easy to shop for grinders online. Grinder manufactures have flooded
the Internet with their products for purchase. In order for our product to be competitive with
other grinders, CTI needs to get their product onto these websites so consumers can easily
locate and purchase a CTI grinder.
o The Country Grain Mill appears on most sites selling hand crank grinders

27
http://www.rasmussenreports.com/public_content/business/indexes/discover_consumer_spending_monitor/di
scover_r_consumer_spending_monitor_sm
28
http://online.wsj.com/article/SB125138431827963711.html
29
Grewal, Dhruv, and Michael Levy. Marketing. Boston: McGraw-‐Hill Irwin, 2010. Print.
30
http://www.rurdev.usda.gov/rbs/coops/vadg.htm
31
http://www.usda.gov/wps/portal/usda/usdahome?navid=ORGANIC_CERTIFICATIO&navtype=RT&parentnav=AG
RICULTURE

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• Electric/Automatic Grinders are available for purchase from many kitchen appliance stores and
at a lower cost32
o These most likely would be used by home users and not small farmers
• Whole Grain Milling developed and built their own grinder to process their own organically
grown grains
• Coffee grinders for use in cafes and restaurants could also be considered competition for CTI
given that CTI grinders can also grind coffee beans
• Other websites selling grinders also include recipes
o CTI could also include recipes on their website and possibly include a recipe book with
purchase of a grinder. This recipe book could include pictures and stories of the grinders
being used abroad and potentially recipes from users abroad.
• None of the grinders on the market support a cause like CTI grinders. This is an opportunity for
CTI to differentiate their grinders on the basis of the philanthropic benefit associated with
purchasing a grinder
SWOT Analysis

Strengths
• By purchasing one of CTI’s grinders, consumers get the added value of knowing their purchase
goes towards alleviating hunger across the world.
• CTI grinders turn grains, nuts, and other raw foods into raw ingredients which are turned into all
kinds of food. This has many impacts...
o Grinder owners can use the grinder and ingredients it produces to make their own
delicious foods including, but not limited to peanut butter, bread, and spices.
o Grinder owners save money on groceries by making their own food.
o The grinder is meant to grind all natural raw foods which have not been processed by a
large company with preservatives and the like, resulting in a much healthier and natural
end product.
• Because CTI grinders are sold with a manual crank, owners cut down on the carbon footprint
they leave by operating a gas or electric powered grinder.
• CTI products are of high quality and are extremely durable. The grinder burrs are made from
Rockwell C53 stainless steel and should last a lifetime. Also, the durability of this product allows
the grinder to be passed down through generations, adding a kind of “nostalgic” value to our
product.
• Adjust burrs to make the food more fine or coarse.

32
http://www.everythingkitchens.com/grainmills.html

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• The company website clearly demonstrates CTI’s mission and the positive impacts their products
have in the developing world, allowing grinder purchasers to research more closely how their
purchase made a social impact.
• Our product is very similar to many of the other grinders on the market which are praised for
their high quality and cost about the same.
Weaknesses
• CTI has never sold their products domestically except for a few individuals who have
approached CTI about purchasing a grinder in the US.
• CTI has not previously sold their grinders for profit. Grinders have only been sold at cost. They
have never developed a domestic marketing plan before.
• Due to CTI’s non-‐profit status, their resources and experience for marketing a for profit product
are limited.
• The grinders made by CTI cost quite a bit to produce, which makes them more expensive than
some alternatives offered by competitors.
• There is a lack of awareness that CTI sells as well as donates this product.
• While CTI is effectively using its resources now, there is a chance that there will be a need for
greater resources in the future, should the product achieve a huge success.
Opportunities
• By tapping into a community of consumers who prefer an organic lifestyle, the information of
this product could be passed from one person to the next and build a positive reputation, as
well as awareness of CTI’s mission in the developing worlds.
• Incentive to purchase this product may increase if a cookbook of organic recipes is included with
the purchase of a grinder.
• Consumers may become more interested in the product and CTI’s mission in the developing
world if the website were continually updated with new recipes and uses for the grinder.
• There are many places to promote this product as well as CTI’s mission, including farmer’s
markets, feed stores, organic food magazines and websites, various promotional events, and
global food markets.
• This product could be promoted as a way to help prevent childhood obesity through a healthy,
organic diet.
• A lifetime warranty could be offered on the burrs of the grinder, which would improve the value
of the product.
• Natural Retailers sold 38% of organic food in 2009, according to the Organic Trade Association.
This provides an opportunity for grinder owners to sell their finished product to local natural
retailers, allowing the grinder owners to make their own profit.
Threats
• Price competition. There are grinders available for purchase at a lower price than CTI grinders
will be.
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• The state of the economy and the impact is has had on people’s purchasing decisions makes our
product a harder sell due to its high price and the fact that it is not a “necessary” product (like
groceries and gas).
• Other grinder producing companies employ a variety of different methods and means to sell
their product and capture our market segment, thereby hindering our sales and overall profit.
Things like cheaper grinder, electric grinders, Larger grinders/machinery available for farms
• Demand for this product could be more than expected and the volunteers that produce the
grinders may be unable to keep up. There is also the possibility that demand could be much
lower than expected and selling the product would not be an efficient use of volunteer
resources
• Other products on the market are advertised to “grind” along with many other food producing
settings, adding additional value to their product which threatens our sales.
• The Organic Trade Association reports 54% of organic food was sold at mainstream grocers in
2009. The convenience of buying organic food at the supermarket versus making it yourself is
very much a threat to CTI grinder sales.
SWOT Conclusion
The SWOT analysis has shown that CTI’s greatest strength is in the philanthropic benefit that comes with
purchasing a grinder. Consumers that purchase a grinder from CTI will know that by purchasing a
grinder for themselves they are also helping support CTI’s mission in the developing world. By
emphasizing this point in the product’s promotion, consumers will be more inclined to make purchases
from CTI. Another strength is the durability of the product itself. If CTI were to take advantage of the
opportunity of offering a lifetime warranty on their grinders, consumers would be more willing to
purchase from them. CTI’s greatest weakness lies in the fact that its products have never been sold for
profit before. Because they have primarily relied on donations, they have no experience in marketing
for profit which could make promotion of the product difficult. However, there are many opportunities
for promotion at locations such as farmer’s markets, organic food magazines, websites, and various
promotional events. By taking advantage of these opportunities, awareness of the product and CTI’s
mission should continue to spread. CTI’s largest threat is in the less expensive and electric alternatives
offered by competing companies. While purchasing a CTI grinder would promote the company’s
mission, some consumers may be more inclined to buy a cheaper product.

STP Analysis
Segmentation
Small scale producing (for profit)

• small farms (annual sales less than $10,000), organic farms, farmer’s market vendors
o Pros
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 Small scale producers use grinders to turn raw products into value added
products. The National Sustainable Agriculture Information Service explains
that producing farmer’s own grains is a strategy to keep their farming
operations viable.33
 Communities (organic, small farming) and community events (tradeshows,
conferences) provide accessibility into large numbers of potential customers.
 The “green/sustainable” value of CTI grinders is especially appealing to organic
farmers.
 Small and organic farms are easy to identify.
 Selling to small scale producers allows for the potential of selling multiple
grinders to one customer. This is unlikely in the home users segment.
 By marketing specifically to small scale producers at tradeshows, home users
will also be marketed to as a byproduct. (ex. Customers who are especially
passionate about sustainable living will attend tradeshows that CTI is at)
o Cons
 For-‐profit companies want to be as efficient as possible in order to make as
much profit as possible. For this reason, electric grinders and larger grinders
may have a competitive advantage over CTI grinders.
 CTI’s corporate social responsibility message/program adds a lot of value to CTI
grinders in many consumers’ minds. Marketing to small scale producers who
may be solely interested in a grinders functionality are not necessarily
interested in CTI’s social programs. In this sense, the CTI grinder is viewed as
less competitively advantageous.

Home users (personal use)
• Pros
o responsive to our “global outreach” message/program.
o Reachable through many channels including grocery ads, “mom websites”, blogs, etc...
o Positive feedback about CTI grinders from satisfied customers promote CTI in the hopes
of capturing more market share.
o Venues like the Midtown Global Market in the Twin Cities provide an excellent
opportunity to reach home users
• Cons
o High cost of CTI grinder may be off-‐putting to potential customers who will not make
any monetary profit from the grinder.
o Home users are the least identifiable out of the three segments. CTI would have greater
success marketing their grinder to a segment that is easier to target more directly.

Businesses (wholesale)
o Pros

33
http://attra.ncat.org/attra-‐pub/PDF/grainpro.pdf
16

 CTI lacks in for-‐profit business management skills. Allowing other retailers to
sell CTI grinders alleviates some of the product management headaches that CTI
would have to fix.
 Other retailers selling CTI grinders (especially Internet retailers) can reach many
different markets including small scale producers and home users.
o Cons
 Potentially make less profit by going through another retailer who has to sell it
at mark-‐up.
 Sacrifice the personal CTI “message” when a CTI grinder is sold at another
retailer.
Amish/Mennonite
o Pros
 CTI has previously sold a few grinders to Amish/Mennonite people
 Amish/Mennonite people do not use electricity and would value the hand crank
capabilities of CTI’s grinders.
o Cons
 Both the Amish and Mennonite communities would be very difficult to enter.
They do not use any modern technologies and are very isolated communities.

Targeting
Small scale producers (for profit) are the segment that should be targeted because this segment is
identifiable, substantial, reachable, responsive, and profitable. According to all four personal interviews
conducted for primary research, small scale producers would be a viable target market. Two of the
interviewees are small scale producers who use grinders.
o Identifiable
 Small scale producers are relatively easy to identify. Our industry analysis has
shown that a simple Google search can yield thousands of links to potential
customers. Also, the Internet is a relative data mine of potential customer
information for any small scale producer who has a website. This can be used to
hone in even more on potential customers which should yield more effective
and efficient marketing. Additionally, the USDA publishes an Agriculture Census
detailing the population of farms in the U.S.
o Substantial
 Small scale producers may not be as numerous as potential home user
customers but under the right circumstances they are much more substantial to
market to. CTI can market to large numbers of potential customers directly by
attending industry-‐specific tradeshows and conferences (organic, small
farming). These bring large numbers of potential customers together in a
purchasing environment. Also, home users who attend such events are also
marketed to as a byproduct.
o Reachable
17

Acting as a wholesaler and selling grinders through other retailers would allow
CTI to reach the most people. However, by focusing in on small scale producers,
CTI can reach the most customers who are most likely to buy a CTI grinder. This
allows for a greater chance of sale while minimizing wasteful spending on other
marketing channels.
o Responsive
 Small scale producers would be very responsive to CTI grinders. Small scale
farmers, organic farmers, people who sell products at farmers markets, etc..
could/would use a CTI grinder to turn a raw material into a finished product
they would sell. When making a purchase, these producers seek out high
quality tools which will help their business profit. Because CTI grinders are of
high quality, small scale producers would be very responsive to CTI grinders.
o Profitable
 The high price of CTI grinders is off-‐putting to potential home user customers.
Because a small scale producer would see a CTI grinder as an investment in
their business, small scale producers would not be as high-‐price sensitive when
making a purchasing decision. For this reason, small scale producers would
yield a good size profit.
Positioning

CTI should position their grinders as a high quality, long lasting business investment for small scale
producers with the additional value of supporting a social cause that improves the lives of many in the
developing world. Small scale producers would use CTI grinders to turn raw materials (wheat, peanuts,
cocoa beans, etc) into value added products (flour, peanut butter, coffee, etc).

When considering position, product placement in relation to our competitors is also of high importance.
Grinders which are more technologically advanced than CTI grinders, as well as, grinders which are very
similar to CTI grinders are available from competitors. Many also offer lifetime warranties and make
claims of their products’ durability and functionality. However, none of the competitors’ grinders
support a social cause. By positioning CTI grinders in this sense, CTI retains a sustainable competitive
advantage.

Marketing Mix

Product
The Ewing III and Omega VI are hand-‐driven grinders that can make fine flour from various grains and
peanut butter from roasted nuts, as well as other food products.

Key Characteristics
• may be driven with hand crank, pedal power, or motor at 6x the hand cranking rate
• design has been optimized by engineers
• can grind oily products
18

• durable and long lasting

• easily disassembled for cleaning

Value Created by Product
• Increasing the value of the harvest by turning raw food into finished products.
• Preserve more of the food farmers grow.
• People eat healthier and more nutritiously.
• Customer can help support CTI and their mission of improving lives in the developing
world

Products that can be ground
• Wheat
• oats (after hulling)
• sorghum, millet
• corn (dry)
• roasted soy beans
• roasted coffee beans
• roasted cocoa beans
• flax
• Barley
• Rye
• Sesame
• dried leaves such as oregano and parsley
• some dried vegetables such as potatoes and yucca
• hull rice with a special burr attachment.

Product Bundling
• include recipe books with stories and pictures from grinders use in the developing world
• free recipes online

19
Ewing III Omega VI

Typical Ewing III Grinder Output

CROP PRODUCT HAND CRANK
Roasted Peanuts Creamy Peanuts Paste 10KG
Seasam Sesame Paste 11KG
Sorghum Sorghum Flour 18KG
Millet Millet Flour 18KG

Typical Omega VI Grinder Output

CROP PRODUCT 60rpm 85rpm 400rpm
Roasted Peanuts Creamy peanut 15KG` 21KG 65KG
butter
Dry Maize Coarse Flour 14 KG 20KG 150KG
Sorghum Hulled Sorghum 18KG 26KG 100KG
Hulled Sorghum Sorghum Flour 15KG 21KG 125KG

20

Place

Internet
In today’s world, with online shopping markets such as Amazon and Ebay, it is important for
companies to keep up with these online shopping trends. Nearly every firm – whether a small
business, a non-‐profit organization, or otherwise – has a website where consumers can learn more
about the company itself as well as its products or services. Many companies also have a section of
their website dedicated specifically to shopping, where consumers can place orders for the products
and services that are offered by the firm. This is a trend that has grown significantly since the birth
of the Internet to the point where nearly anything can be purchased online.

With this in mind, it would benefit CTI if they made their grinders available for purchase online.
Along with the convenience of being able to purchase the grinders online, links to the company’s
main page would be available, which would allow for CTI’s mission to benefit developing countries
to spread. This would also allow for CTI’s market to spread into other reachable areas.

Farmer’s Markets

For small farms and other small-‐scale producing firms, farmer’s markets provide an excellent outlet
for the promotion and sale of locally produced goods. Local growers and producers are able to bring
their products to farmer’s markets where they can sell and promote their small businesses to those
who do not grow or produce their own food. CTI could get a good foothold in the small-‐scale
producing market by promoting their grinders at the local level at various farmer’s markets
throughout the country. Not only would they be able to promote to small farms and hobby farmers,
but they could also reach consumers who might be interested in making some of their own foods
such as flour, peanut butter, and coffee.

Trade Shows

Trade shows such as the NOFA Summer Conference and the MOSES Organic Farming Conference in
Minnesota can be some of the most beneficial events that CTI can take advantage of. Not only will
CTI be able to promote their product and their cause, but they will also be able to network with
other companies and firms as well as size up any potential competitors who might also be attending
the shows and conferences. At the trade shows, CTI will be able to demonstrate how the grinders
work as well as discuss with potential consumers and business partners. By networking with other
businesses, CTI can not only sell their product and spread the story of their mission further, but they
could also form business relationships and expand their market.

21

Price
CTI would be smart to employ a cost-‐based pricing model when considering how to price their grinders.
CTI’s goal is to make a profit on the grinders they sell in the U.S. in order to support their work in the
developing world. Due to CTI’s limited resources and their non-‐profit status, cost-‐based pricing should
be the most significant consideration. Because CTI is just entering and has little experience concerning
the for profit market, the initial profits CTI makes from its domestic grinder sales will be significant for
them to finance their operation. With this in mind, value-‐based pricing would potentially yield less
profit than cost-‐based pricing at this point in time. Additionally, due to the fact that other models
(including electric models) are available for purchase, competitor based pricing should also be
considered.
Current Cost of Production
Grinder Cost
Ewing III $200
Omega VI $325

Competitor Pricing
Sample of the Grinder prices available online
Grinder Price
Back to Basics Grain Mill $47
Family Grain Mill $129.95
L’ Equip NutriMill Grain Mill $289
Household Stone Burr Mill $375
The Country Living Grain Mill $409
Grain Maker $425-‐695
Diamant Grain Mill $1299

22

The Ewing III should be priced around $300 to cover cost of production and earn a profit of $100 per
unit sold for CTI while still remaining competitive with the price of other grinders. This would place the
Ewing III in the lower middle of current grinder prices. It is important to note though that the lower
priced grinders are designed for more household use.
The Omega VI should be priced around $400 to cover cost of production and earn a profit of $75 per
unit sold for CTI while still remaining competitive with the price of other grinders. This would place the
Omega VI in the higher middle of current grinder prices without being on the highest end.
A shipping cost will also have to be applied to the total cost depending on where the product will be
shipped to and how it will be shipped.

Promotion

Social Media
In today’s technology-‐driven world, social media has become a strong resource for information about
various organizations and companies. Many people get their daily news and information from social
media sites such as Facebook and Twitter, which makes having a social media page imperative for many
firms. CTI already has a Facebook page where they promote events to raise money for their cause, but
they could use it further as a means to promote their grinders as purchasable products. CTI could also
extend their social media promotion to Twitter, where they could post feeds that are similar to those
that they post on Facebook.

On a similar note, many companies have found ways to promote themselves on YouTube. CTI could also
extend themselves to YouTube by making videos that raise awareness of world hunger while offering
the purchase of a grinder as a way to help in this worldly issue. CTI could also make tutorial videos on
how to use the grinders to make food products such as flour, peanut butter, and coffee.

Web Site
CTI’s web site is already very informative on the issue of world hunger and the firm’s mission to combat
it. By offering grinders for sale on the website, CTI could gain an increase in sales due to the
convenience that is offered by online shopping. At the same time, CTI’s mission to end world hunger
could spread further and continue to promote the purchases of the grinders.

Magazines
Although the Internet is a large source of information, many people still look to print resources such as
newspapers and magazines. There are many magazines related to farming and organic farming, such as
Hobby Farms, Successful Farming, and Progressive Farmer, just to name a few. CTI could make
advertisements to be placed in these magazines, including a line mentioning their mission against world
hunger and how it can be helped by the purchase of these grinders.
23

Brochures, Newsletter, and Posters
As far as nonprofit companies are concerned, informational brochures play a large part of advertising
and promotion of the companies and their causes. CTI could take advantage of this and include a
segment in their brochures and informational packages advertising that grinders are available for
personal purchase, and that the money will go toward making more grinders to be sent in developing
countries.

Word of Mouth
Word of mouth is one of the oldest forms of advertising as well as one of the most effective. Consumers
seek advice and recommendations about products from their friends and families constantly. CTI’s
grinders are excellent products that will last for a long time, a trait that will come in handy when past
consumers provide recommendations to potential future consumers. In addition to this, CTI could
advertise that grinders are available for purchase after demonstrating how they help struggling villages
in developing countries.

Emphasis on Social Cause Component
In promoting CTI grinders, CTI should focus on the philanthropic benefit that comes with purchasing a
grinder. Promotional materials should emphasize CTI’s mission and include personal stories of how CTI’s
devices have improved lives.

Implementation Strategy
• The first step CTI must take is to create an online store on their web page. Currently, there is a
device inquiry form on the site but a page should be added that makes it clearer that grinders
are for sale. By adding a section to CTI’s website to purchase grinders, the consumer will be able
to see what exactly each grinder is capable of doing and be able to purchase the grinder on the
spot. Due to different price schemes for non-‐profit and for profit companies, it is recommended
that CTI include a section of the online store where tax codes could be entered to verify non-‐
profit purchases.
• CTI must also add a section about grinders for sale to the existing brochures and news letter so
that potential donors will also be aware that they can purchase individual grinders for their own
use.
• CTI can promote brand awareness by continuing and increasing efforts to promote the
organization and its mission. They can make the organization more visible by using social media
such as Twitter and YouTube, and attending conferences and trade shows in addition to current
efforts to publicize CTI in general.
• CTI should buy strategically placed ads. By buying ads in magazines, online ads, etc. CTI will be
able to promote that they now sell grinders for purchase in the US.
• By tapping into farming networks by attending trade shows, conferences, and farmer’s markets,
CTI will be able to spread the awareness of the product as well as their mission in developing
countries.
24

Contingency Plan

In the case that CTI’s targeting of the small-‐scale producing segment does not produce as much profit as
was expected, they will simply have to re-‐target their market toward whichever segment seems to show
the most interest in the grinders. The most likely alternative to small-‐scale producing firms would be
individual home users. In this case, CTI would turn away from promoting their product at trade shows
and emphasize online sales. CTI could still promote themselves at farmer’s markets since many
homeowners shop there as well.

The other issue that may arise is the high price of the grinders. Many competitors have similar products
to CTI’s available at lower prices. If consumers are not receptive to the offered price or swayed by CTI’s
mission, then the grinders’ price will have to be lowered. However, lowering the price may turn a larger
profit if more consumers become receptive to the product and the new, lower price attached to it. In
this case, the profit margin on each individual grinder will be smaller, but the overall profits will be
higher.

Financials

When considering promotional efforts the company’s resource constraints must be taken into
consideration. As a non-‐profit organization funded primarily by donations with a primary mission of
sending life improving technologies to the developing world, CTI will have limited resources in terms of
spending on promotional efforts. However, CTI already has several resources in place which the
organization can add to and use in their promotional efforts at very little cost. The website, brochures,
news letter, and social media are already in place.

After production costs, CTI will make $75/100 on each grinder sold. CTI must determine how many
grinders must be sold in order to make their marketing efforts worth the time and cost. To help with
this, the ROI for hypothetical marketing expenditures of $5,000 and $10,000 have been calculated
below. In order to avoid confusion, the “gross margin %” has been entered as $100.

ROI = (Sales x Gross margin% -‐ Marketing expenditure)
Marketing expenditure

ROI = (Sales x 100 -‐ $5,000) 0=50
$5,000

ROI = (Sales x 100 -‐ $10,000) 0=100
$10,000

Based on these projections, if CTI wanted to make a profit on their grinder sales after production and
marketing expenditures, they would have to sell…

• 50 units if they spent $5,000 on marketing expenditures
• 100 units if they spent $10,000 on marketing expenditures

For every $1,000 spent on Marketing, CTI must sell at least 10 units to break even, more if want to make
a profit.
25

Measures of Success

In order to measure the success of our marketing plan, CTI should monitor numerous market and
financial characteristics. One such characteristic is sales. If CTI enters the domestic market and sales are
low then concerns about segmentation choice and product promotion should be addressed. One way
CTI could avoid this and gain a better understanding of their customer demographics would be to
include a survey with each grinder purchased. Asking questions like “How did you hear about CTI/CTI
grinders?” would help CTI figure out who to target better. Another measure of CTI success is profit. CTI
should make a significant enough profit off of grinder sales to at least cover production and promotional
costs. More profit means more success. Finally, one final measure of success for CTI is seeing what the
company is doing right. Because CTI can analyze customer information from grinder purchases to see
when it made the most and least profit and sales, CTI can link what promotional efforts it was pursuing
at the time and adjust accordingly.

26

Figures

Figure 134

Figure 235

34
35
27

Figure 336

36
28

Figure 437

37
Nielsen Homescan data from 2001 and 2004 http://www.choicesmagazine.org/2007-‐2/grabbag/2007-‐2-‐05.htm

29

Figure 538

38
Nielsen Homescan data from 2001 and 2004 http://www.choicesmagazine.org/2007-‐2/grabbag/2007-‐2-‐05.htm

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• Farmers (in general)

Small scale producing (for profit)

• durable and long lasting

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