Group Ding Dong Alberto, Camposano, Feliciano, Neri, San Diego, Velasquez

Goldilocks Bakeshop Inc. Marketing Audit I. External Business and Economic Environment
Economic Employment
The July 2010 Labor Force Survey (LFS) revealed an employment rate of 93.1 percent, and estimated the number of employed persons at 36.3 million. Among the regions, Cagayan Valley, Zamboanga Peninsula, Northern Mindanao and Autonomous Region in Muslim Mindanao (ARMM) posted the highest employment rate at 96 percent. The National Capital Region (NCR) had the lowest employment rate at 89.1 percent (National Statistics Office). The July 2010 LFS also revealed that the size of the labor force was approximately 39.0 million out of the estimated 60.9 million population 15 years old and over. Correspondingly, these numbers translate to a labor force participation rate (LFPR) of 64.0 percent (National Statistics Office). Of the estimated 36.3 million employed persons in July 2010, the services sector was the largest group comprising more than half (51.2%) of the total employed population. The highest employed workforce in the services sector were in wholesale and retail trade, repair of motor vehicles, motorcycles and personal and household goods (19.4% of the total employed) (National Statistics Office).

Foreign Exchange
The baking industrys dependence on imported flour makes it very important to monitor the foreign exchange market. Capital Economics (a London-based think-tank) international economists Kevin Grice and Ashira Perera, in a study titled The Philippines tightening cycle to begin soon, said the peso would appreciate to 39 instead of the previous forecast of 41 by the end of 2011 as currencies in the Asia Pacific region are expected to strengthen against the greenback until next year (Agcaoili).

Monetary Policy
In its December 29 policy-setting meeting, the BSP maintained its key overnight borrowing and lending rates at 4.0 percent and 6.0 percent, respectively, as inflation forecasts continue to be within target range of 3.5 to 5.0 percent for 2010 and 3.0 to 5.0 percent for 2011 and 2012 (Bangko Sentral ng Pilipinas 1).

Inflation
Year-on-year headline inflation increased to 3.0 percent in November from 2.8 percent in October. Electricity prices went up in November with the higher cost of power from the National Power Corporation (NPC) and the Wholesale Electricity Spot Market (WESM). The impact of higher global crude oil prices on the domestic pump prices of petroleum products led to higher inflation for transportation and communication services. Meanwhile, food prices were generally stable, particularly for meat and rice (Bangko Sentral ng Pilipinas 2). Various surveys continued to indicate well-contained inflation expectations over the policy horizon. The Asia Pacific consensus forecasts and the BSPs survey of private sector economists showed within-target inflation forecasts for 2010-2011. However, relative to the previous estimates, the average baseline inflation forecasts for 2011-2012 are higher. The higher actual inflation for November compared to the baseline forecast for the month contributed to the increase in inflation forecasts. In addition, the forecasted stronger output growth and liquidity expansion, as well as higher oil prices, also contributed to the increase in the current forecast (Bangko Sentral ng Pilipinas 2-3). The upside risks to future inflation include a potential rebound in oil prices given the continuing strong demand by emerging economies, additional increase in rice prices, potential increase in the price of other non-oil commodities, the impact of adverse weather conditions on agriculture, petitions for electricity rate adjustments, and a stronger-than-expected domestic economic recovery that could induce demand-side price pressures. The downside risks to inflation relate to the slow recovery of global growth and a sustained strengthening of the peso-dollar exchange rate which could help temper the impact of imported inflation (Bangko Sentral ng Pilipinas 3).

Demand conditions
Despite the recent slowdown in industrial production and the drop in agricultural production, the underlying growth momentum continues to be robust. The deceleration is not surprising as the partly inventory-driven rebound in global trade in the first half of 2010 has been moderating. However, domestic demand momentum remains relatively strong. Leading indicators of demand (vehicle sales, energy consumption, and exports) continue to grow at double-digit rates. However, these demand indicators have also eased slightly from the rapid pace recorded in the early part of 2010. Meanwhile, capacity utilization in manufacturing and measures of business and consumer confidence posted record highs in the fourth quarter (Bangko Sentral ng Pilipinas 3). Capital Economics Ltd. expects the countrys (GDP) to expand 6.5% this year before slowing down to 5.5% next year. The Cabinet-level Development Budget Coordination Committee (DBCC) sees the countrys GDP expanding by 5% to 6% this year and by 7% to 8% next year (Agcaoili).

Supply-side indicators

Agriculture During the first semester of 2010, the agriculture sector contracted due to the effects of El Nio, particularly on the production of corn, palay, and sugarcane. Agricultural production is expected to register a year-on-year decline for the entire year due to the impact of weather disturbances. Typhoon Juan exacerbated the expected decline in the production of both rice and corn in 2010. Latest domestic climate reports point to the onset of a weak-to-moderate La Nia episode, which is expected to last until May 2011 (Bangko Sentral ng Pilipinas 3-4). DTI warns of more price increases. After a National Price Coordinating Council (NPCC) meeting last February 11, 2011, the Department of Trade and Industry (DTI) warned of higher prices of various basic necessities and prime commodities amid the unabated increase in global demand and prices. DTI Secretary Gregory Domingo said flour prices are expected to rise in the coming weeks to about P850 per 25-kilogram bag from the current P820 to P830 a bag, as globalwheat prices hover at all-time highsmore than double last years prices because of higher global demand amid slower production of wheat-producing countries. The DTI chief said wheat prices in February increased 15 percent from January. He is not discounting flour prices hitting P900 per sack if global wheat prices do not stabilize (De Vera).

External developments
The global economy performed strongly in the first half of 2010 but latest indicators suggest that the pace of recovery is slowing down. Economic expansion in the US quickened in Q3 2010 but experts, including the US Fed, remained concerned about the sustainability of the recovery given tepid employment conditions. To promote a stronger pace of economic recovery and help ensure that inflation over time remained consistent with its price stability mandate, the US Fed committed to expand further its holdings of securities on November 3, 2010. Meanwhile, economic activity in the euro area grew strongly in the second quarter of 2010 but latest surveybased indicators point to a possible moderation in the third quarter. The Japanese economy also showed signs of moderate growth but the pace of recovery is slowing down. On the other hand, Asian economies continued to exhibit strong growth momentum. (Bangko Sentral ng Pilipinas 7).

Political and Legal

The government plans to extend the zero-tariff on wheat flour until the month of April to help drive local flour prices down (Montemayor).

Social/cultural
Rising country population translates to growth in demand.

The National Statistics Office (NSO) projected population to grow by 1.95 percent and reach 94 million by 2010 and 102.97 million by 2015. The ballooning of the teenage population will make this age group the likely target of fast food chains. It should be noted that fast food brands like Jollibee and McDonalds has long targeted tweens in their marketing strategy. In addition to this, the forecast period will continue to see their focus expand to teens and young professionals (Fast Food Philippines 5) The Philippine Association of Flour Miller (PAFMIL) has revealed that some 85.0 percent of Filipinos prefer to eat bread for breakfast rather than the usual rice, implying a positive outlook in the growth potential of the baking industry The move to a healthier lifestyle resulted in a shift in preference for healthier whole wheat bread, which may increase demand for such product line of the industry. A reference used by the Philippine Council for Health and Development (PCHRD) revealed that those who ate food with whole grains are less likely to gain weight. However, this trend also leans to the advantage of fruit/fruit-based snacks as these are known to contain more natural vitamins and nutrients. The drought experienced in the first half of 2010 could potentially harm transactions per outlet in Northern Luzon and Mindanao. Consumers in these areas are likely to have less income to spend on fast food due to the destruction of agricultural products during the Ondoy and Pepeng typhoons and drought. It should be noted that agriculture remains the primary source of consumer income. The power outages experienced simultaneously with the drought could also dampen investor confidence in the country (Fast Food Philippines 5).

Intracompany

Goldilocks labor dispute settled

ABS-CBN news reported that a recent labor dispute between the workers and management of Goldilocks Bakeshop ended in a new agreement last October. The members of Bukluran ng Independenteng Samahan na Itinatag sa Goldilocks went on strike last March 11 to protest alleged labor rights violations such as union busting and illegal dismissal of workers. With the new agreement , issues such as provisions in workers contributions in the Social Security System, Pag-IBIG and PhilHealth were solved. The management also agreed to give the workers advances representing a portion of their 13th month pay and the equivalent amount of their vacation and sick leaves for 2010. Labor Secretary Rosalinda Baldoz described the settled case as a maturing relationship between labor and management. I am sure both parties are beginning to realize their increasing roles in resolving labor disputes without too much government intervention, which is exactly one of the reforms being initiated by the DOLE in consistent with the directives of President Benigno S. Aquino III in the area of labor relations.

Expansion initiatives of bakeries indicate robust industry growth.

Cases in point: Business World revealed that Goldilocks Bakeshop put up 40 more branches in the last quarter of 2010, thereby, having nearly 350 branches nationwide to operate at the end of 2010. Furthermore, a new manufacturing plant also started its operations last year to tap more markets in Northern Luzon through franchising and organic growth. Dunkin' Donuts, the world's biggest donut, coffee and baked goods chain, has expanded to approximately 700 outlets in the Philippines and is now targeting the opening of 1,000 outlets nationwide(Philippine Star: Goldilocks bakeshop chain to open 40 branches). Gardenia Bakeries Philippines Inc. is planning to invest hundreds of millions of pesos in new plants in the Visayas and Mindanao over the next two to three years. Gardenia president and general manager Simplicio Umali Jr. said the company was planning to invest up to P150 million in its Cebu operations, alone, this year (Ho). The president and chief operating officer of Julies Franchise Corporation, Mr. Joseph R. Gandionco, sets a bullish growth in sales for 2011 after branching out to 50 to 60 new outlets all over the country. Gandioco also added that the company sets an aggressive marketing plan of opening outlets in nearby countries such as Jakarta, Indonesia (Business World: Bakeshop Chain Expects Sales to Grow).

The growth of specialty coffee shops may extend to an increase in demand for the industrys products.

Bread and other pastries are good complements to coffee, and some coffee shops source such products from the industry. Specialty coffee shops are seen to exhibit a 10 to 20 percent growth yearly for the next three to five years (Agriculture and Agri-Food Canada, the Brewing Business of the Philippine Specialty Coffee Shop Industry).

Technology
The process of baking bread is highly automated, such that firms are able to mass produce and thus utilize their equipment more efficiently. Gardenias state-of-the art manufacturing plant is the most advanced large-scale bread manufacturing plant in the country today. Gardenia's loaf breads are baked practically "untouched by human hands", a feat that is unmatched by other local bakeries. The plant uses one of the world's most technologically-advanced and environment-friendly large-scale ovens that can utilize compressed natural gas as an alternative to LPG (Gardenia Bakeries Philippines).Taking these into consideration, potential players will therefore have to come in at a large scale to be at par with incumbents, or operate at a small scale and suffer losses from lagging behind large-producing firms. Entry barriers are heightened by the industrys dependence on imported inputs, a large bulk of which is flour. However, the industry does not need high technology equipment as compared to other automated manufacturing businesses, implying low capital investment. The existence of second-hand bakery machineries also lowers capital needed by entrants, thereby neutralizing entry barriers.

The Market and the Consumer

Total Market
The baked goods industry, mainly comprised of sweet baked goods specialist like Dunkin Donuts, Krispy Kreme, and Goldilocks, experiences growth in sales in 2010 as the Philippine economy recovers from the global recession. This growth was largely due to big investments in advertising by companies such as Red Ribbon Bake Shop Inc. and Goldilocks Bake Shop Inc. as well as the availability of private label products that made it possible for consumers to purchase baked goods regularly and consume them as mid-day snacks(Euromonitor: Baked Goods Philippines, 1). The fast food industry also records value growth, but in a smaller rate than previous years as consumers try to reduce their expenditure. Chained fast food dominates this industry with the help of franchising as it contributes 96% of sales(Euromonitor: Fast Foods Philippines, 1-2).

Market Development Trends and Characteristics

Although fast food brands like Jollibee and Mcdonalds has been targeting tweens in their marketing strategy for a long time, the increasing population of teenagers will make this age group an important target of fast food chains. Companies are noew responding to the change in consumers tastes by making their modernizing their outlets and making it look trendier as customers become more concerned about the restaurants ambience(Euromonitor: Fast Foods Philippines, 3). The more-for-less strategy is continued to be used as value meals continue to be popular among consumers. New variants of Jollibees 39ers were released in 2009, Chowking offered meals that are complete with drinks for the price of 49 pesos and McDonalds used this strategy with their 25 pesos meals. Goldilocks now makes smaller versions of their cakes which are more convenient and affordable for their customers(Euromonitor: Fast Foods Philippines, 1). Recently, there has also been a trend of BPO expansions in areas outside Metro Manila. The establishment of these BPO hubs in these areas creates a circle of employees that are getting paid above average. Companies in the foodservice industry are now taking advantage of this trend by expanding in these cities. Examples of these cities are Iloilo City, Davao City, Lipa City, and Metro Pampanga(Euromonitor: Fast Foods Philippines, 3). The health and wellness trend is also being taken advantage of by the baked goods industry as they make their products healthier. For example, Gardenia Philippines Inc. introduced Slim n Fit wheaten bread in 2009 which contains L-Carnatine, an amino acid that helps increase the conversion of fat to energy(Euromonitor: Baked Goods Philippines, 2).

Competition
Gardenia Philippine Inc.s leadership position in the baked goods industry is mainly because of the innovations that it made by offering new products in 2009 that cater to consumer needs and because of its expanded geographical reach when it entered untapped locations such as Samar and Leyte(Euromonitor: Baked Goods Philippines, 1-2).

In the fast food industry, Mang Inasal Philippines Inc. became the fastest growing brand in 2009 as it expanded the number of its outlets from 92 in 2008 to 214 in 2009. The companys success was mainly due to its use of the more-for-less strategy which was complemented by the economic slowdown which forced consumers into looking for cheaper and more satisfying alternatives. Political and Social factors in the Philippines also contributed to the success of Mang Inasal in the way that Filipinos are now becoming more nationalistic(Euromonitor: Fast Foods Philippines, 2).

Prices
Because of the increasing prices of raw ingredients, unit price of baked goods increased in 2010. The increase can also be attributed to the introduction of new product innovations such as healthier breads. However, tight competition in the industry will prompt players to be more cautious about their pricing as they try to strengthen their position because consumers continue to look for more affordable products(Euromonitor: Baked Goods Philippines, 1). For cakes and cake rolls, Goldilocks offers the cheapest products compared to its competitors. Gardenia, however, offers cheaper products in other categories such as loaves and pandesal. In the fast food industry, Goldilocks, Mang Inasal, and Chowking offers the cheapest meals while restaurants like Wendys and Red Ribbon do not offer meals below 88 pesos (for the list of price ranges in the baked goods and fast food industry, see appendix 4).

Physical Distribution
Flexible packaging, which involves the use of film, foil, or paper sheeting, is the most commonly used packaging type in the baked goods industry in 2009. Take-away and delivery becomes an important concern for the foodservice industry as revenues from this type of distribution steadily grows. For example, City Delivery, which is a delivery service which uses the centralized hotline 87878 for different restaurants, was developed in 2009 to make it easier for consumers to order food(Euromonitor: Baked Goods Philippines, 2).

Communication
Because companies in the foodservice industry are beginning to target teens and young professionals, most of the promotions and advertisements will tap youth celebrities like Sarah Geronimo and John Lloyd Cruz. Events and activities that will attract the youth are also conducted. For example, Jollibee organized a dance mob in 2009 and the event is planned to be continued as a yearly event that will have teenagers as participants(Euromonitor: Fast Foods Philippines, 3). The internet also proves to be a significant tool for promotions in the foodservice industry. Because reviews by people in the people in the internet is perceived to be more objective than advertisements that come from the company itself, companies today are trying to utilize the use of food bloggers to promote their brand. Food companies are now inviting food bloggers to their product launches, outlet openings, and other important events in order to create buzz in the

internet and to have a good relationship with the food bloggers themselves(Euromonitor: Consumer Foodservice Philippines, 2) .

Industry Practices
Expansion strategies in the foodservice industry are usually facilitated by franchising especially in fast food, street stall/kiosk, and full-service restaurants. Chained specialist coffee shops like Starbucks and Seattles Best Coffeee, however, do not use franchising in order to ensure the quality of their products(Euromonitor: Consumer Foodservice Philippines, 2) .

Competition
Industry Structure
The market leader in the baked goods industry is Gardenia Philippines Inc. with 8.8% share of the market in 2009. Goldilocks comes close with 8.6% market share and the difference between the third is bigger with MLM Foods Inc. getting 5.1% of the market (for the complete list of companies in the Baked Goods Industry, see Appendix 2). Baked Goods are divided into three main categories: breads, cakes, and pastries. Each category can be further divided into packaged or industrial products and unpackaged or artisanal products(Euromonitor: Baked Goods Philippines, 1-2). Jollibee Foods Corporation is the clear leader in the fast food industry, taking 59.9% of the market share in 2009, including subsidiaries and franchisees, while Golden Arches Dev Corp. is a far second with 14.8% share (for the complete list of companies in the Fast Food Industry, see Appendix 3). Fast Food is categorized by the type of food they serve. Examples are asian fast food, latin American fast foog, burger fast food, and bakery products fast food(Euromonitor: Fast Foods Philippines, 2)

The Consumers
Key Insights
As an influence from Western culture, Filipinos continue to love burgers, spaghetti, and fried chicken. However, Filipino food is starting to get more popular with the help of chicken fast food restaurants that serve chicken inasal(Euromonitor: Fast Foods Philippines, 1). In the baked goods industry, consumers will prefer packaged goods over unpackaged goods due to the longer shelf-life of packaged goods which will provide convenience for consumers as they can buy them in bulk and they dont have to consume these right away. However, unpackaged products still accounts for 52% value share of baked goods in 2010 as many consumers prefer freshly made goods in stores near their neighborhood(Euromonitor: Baked Goods Philippines, 2).

Because affordability is a major concern for consumers, the preference for street stalls / kiosks rises, especially now that rice meals are now offered in these chained street stalls, which enabled employees to eat out in the stalls rather than in fast food or full service restaurants(Euromonitor: Consumer Foodservice Philippines, 4-6).

II. Internal
Sales
Goldilocks Bake Shop Incorporation was founded by sisters, Maria Flor, Milagros and Clarita Leelin, and their sister-in-law Doris in 1996 with a startup capital of P10,000. The family business was started in a one-door apartment of a two-storey structure on Pasong Tamo Street, Makati City, serving customers with delectable collections of cakes and pastries. The companys first day sales was P574 which when adjusted for inflation was estimated to be P21,025 of value today. Through the years, Goldilocks has been profitable a company gaining annual sales of P4,906,013,887 in 2008 and P5,430,540,793 in 2009. This amount is substantially larger as compared to the net sales of Red Ribbon and Gardenia, which are its nearest competitors. For Red Ribbon, sales amounted to only P2,566,654,012 in 2008 and P2,619,522,058 in 2009, while Gardenias sales reached P2,020,191,661 and P2,114,672,440 in the respective years. If we will compute the percentage increase in sales, Goldilocks fared best with 11% sales increase followed by Gardenia with 4% and Red Ribbon with 2%. (see Appendix 6)

Market Share
For the Global brand owner shares of chained fast food, Goldilocks ranked 5th with 1.9% shares from the total market industry in 2009. Jollibee Foods Corporation remained the market leader acquiring 59.9% market share, followed by McDonalds Corporation with 14%, Yum Brand Inc. with 3.9%, and Mang Inasal Phils Inc. with 3% share in the fast-food industry. In the chained consumer foodservice company shares category, a 1.3% share was obtained by Goldilocks placing it in the top ten percentile of this class. The company also obtained 1.3% for the chained consumer foodservice brand share. Although proportionally small, this is actually higher than the 0.7% share acquired by Red Ribbon. In the baking industry, Goldilocks positioned itself as the 2nd largest share owner among the baked good companies and the baked goods brands next to Gardenia Philippines Incorporation. Goldilocks gained 8.6% retail value while Gardenia got 8.8% and Red Ribbon 2.4%. (Euromonitor, December 27, 2010)

Profit Margins
2009 was a lucrative year for Goldilocks. Based from the financial statements, it has managed to raise gross profit from P1, 146,139,143 in 2008 to P1, 313,081,950 in 2009. This then lead to a 53% increase in net income from P187, 631,279 to P287, 212,290. Comparing with close competitors, the corporations profit was larger by about P800 million. For Gardenia Philippines

Inc., although its gross profit and net income increased, (Gross Profit from P377,729,688 to P433,022,672; Net Income from P20,141,752 to P35,687,721) it did not get to the billion peso gross profit made by Goldilocks. The same thing with Red Ribbon, its profits only amounted to P448, 423,198 in 2008 and P484, 408,104 in 2009. And while Goldilocks and Gardenia were experiencing improvements in profits and income, Red Ribbon had a decline in net income from P33, 291,535 to P14, 044,692 in 2009. However, it should be noted that although Red Ribbon experienced the smallest percentage increase in sales among the 3 companies and also a decline in its net income, its net profit margin of 18.49% is substantially larger than Gardenias 1.36% and Goldilocks 5.29%

Marketing Organization

Marketing Director

Decorations Department (Manager)

Marketing Department

Sales Department (Manager)

Research Manager

Corporate Manager and Food shop manager

Bake Shop Manager

Local Store Marketing Manager

The marketing organization of Goldilocks is composed of a head marketing director who supervises three departments beneath itthe decorations, marketing, and sales departments. These departments would give reports on the development of their respective divisions as requested by the director. The director is the one in charge of the monitoring and integration of the information gathered from the various departments. He is the most knowledgeable person with regards to the undertakings and accomplishments of the company. He is highly involved in the decision-making process and his insights are highly valued. The marketing director serves as the public relations officer who embodies the organization for corporate communication. The first department under the director is the decorations department. As its name implies, the decorations department focuses on the creation of designs for the companys products. Under this department are people with the knack specifically in cake-making. They are the ones who produce the designs according to the customers needs. The approval of the designs, however,

is left to the decorations manager who decides what and what not are the designs to implement. Although Goldilocks allows customers to decide on what they want their cakes to be, the designs made by this department apply to the basic pastries available in every Goldilocks stores. They construct the packaging of goods and fashion the cakes to the desired shape, size, color, and texture. Whenever the company decides to launch new products, the decorations department ensures that the new product will be appreciated by customers and that there is proportion, balance, and harmony on the elements comprising it. The next department is the sales. It is the one who gathers sales reports from each of the branches locally and internationally. The sales department integrates or compiles the sales data of each product from all the Goldilocks branches. It is mandated that each branch must submit reports per region on how their stores are generating revenues. In the case of international branches, sales data are forwarded to the main office in the Philippines under the supervision of the managers who are Filipino expatriates. In this way the sales department of the main Goldilocks office will know how the branches are faring against all other operating branches globally. Through this the company is able to track which branches generate the most profits and which product is in demand and sells best. The third one is the marketing department. This department is comprised of the research, corporate, food shop, bake shop, and local store marketing managers. The research department probes the opportunities in the market. They look for the latest trends and think of ways to improve the companys product offerings. With the overwhelming trends on the rise, the role of the research manager is to scan these trends and determine which specific trend to act on. As we know Goldilocks works on two industry linesthe food shop and the bakeshop. The company makes certain that these two lines are being watched upon, and the products from the lines are marketed perfectly. To achieve this goal, managers are assigned to monitor the different lines, making sure that no products are left behind. The corporate and bakeshop managers for instance are concerned about the baked goods line of the corporation. Their job revolves around the growth and improvement of Goldilocks baked goods products. And while the corporate and bakeshop managers are into bakeshops, the food shop manager is into the foodservice industry line. Everything that relates to the non-baked products of the company is its concern. The food shop managers duty is to find ways to sell the dishes they put on sale. Recently, various diversifications have been done by Goldilocks. And if you will ask how Goldilocks chooses the location to put their stores, ask the local store marketing manager. He is the one who selects the suitable place for the outlets to be built. He sets the distance between branches, taking care not to create customer divide and guaranteeing that the location would make the company tap more customers.

Company Vision / Mission

Vision: Goldilocks, a strong global brand! Mission: Goldilocks symbolizes excellence in products and services that go beyond customer expectation worldwide.

Marketing Procedures and Strategies

Everything that Goldilocks achieved was never a stoke of luck. All strategies have been planned, every detail has been scrutinized, and certain factors have been analyzed. Starting from the selection of the company name, Goldilocks was picked for its wealth-sounding syllables gold and locks to suggest richness and prosperity. The named was also aimed to create a strong appeal and attract interest of mothers and childrenthe companys primary target market. (Malabanan, January 2007) Goldilocks has been an icon of the Filipinos strong family ties and get-togetherness. From the beginning, it engaged itself in niche marketing servicing primarily the Filipino family. Its products were catered for every occasionbirthday, wedding, anniversary, graduation and other special events in the Filipino life. Today, the company competes for the mass market particularly the A, B and C, and has brought its products in the overseas markets.

(SOURCE: www.aseanfoundation.org)

In the minds of consumers, Goldilocks has positioned itself as a bake shop with international standards that caters to Filipino taste. It showcases a wide portfolio of native quality dishes and sweets which are relatively cheaper as compared to the product line of most branded bakeshops. As a brand, it has created an identity engrossed in the hearts of the people. For strategic direction and product differentiation, the corporation continues to improve retail and foodservice product range to suit the changing lifestyles of Filipinos. For instance, it now offers a guilt-free collectiona line of sugar-free cakes and pastries to meet the emerging need of the health-conscious individuals, to differentiate itself in the market, and to establish integrity for itself. A more-for-less strategy was also used to entice as much consumers by offering smaller cakes which are more affordable. Aside from that, a delivery service was launched giving convenience to customers. Goldilocks success can also be attributed to the aggressive expansion strategies undertaken by the company to reach untapped districts and provincial locations through franchising. Its strong brand equity has helped the creation of more outlets especially in Northern Luzon where there are no chained bakeries. Goldilocks also opened outlets in the international market where there are large Filipino communities looking for a taste of traditional Filipino meals. Through the years,

it has followed the principle of thinking global, strategizing regional, and acting local by fusing in its menu multicultural tastes with the exact flavor and goodness of the native Philippine dishes marketed in the global market.

Marketing Mix Brand Name

The Goldilocks brand is mainly associated with simple Filipino values that created its indelible brand identity. According to international research firm, AC Nielsen, Goldilocks has a 100 percent brand awareness and top-of-mind awareness of 80%. When asked to enumerate bakeshops, 10 out of 10 Filipinos cited Goldilocks, and 8 out of 10 first mentioned the company. This recognition is due to the companys effective positioning and differentiation tactics. (Malabanan, January 2007)

Brand Values & Customer Perception

Thoughtfulness, care, love for familythese are simple Filipino values where the Goldilocks brand is anchored. With every product consumed, customers not only get a regular taste of goodness but a goodness that comes from the Filipino way of life. Filipinos have come to know Goldilocks as a they have come to know toothpaste as colgate and photocopying as Xerox. It is evident that the brand has a strong place in the hearts of every Filipino. (Imbong, October 22, 2010) National consumer surveys have consistently identified Goldilocks as the landslide winner in customer satisfaction indices such as Awareness Conversion (the ability to translate brand awareness to actual trial) and Share of Heart (the emotional approach to measuring preference). Customers perceive Goldilocks as very Pinoy and most of the time they see the products as something not so much for themselves but as something they would like to give someone as a means of showing love and affection. Goldilocks will never grow as much as it has grown today if customers do not place value to it. Goldilocks will always be Filipinos first love. (from Goldilocks official website <goldilocks.com.ph>)

Product Range
After a long time of producing only packaged and unpackaged baked goods and being successful in the baked goods industry, Goldilocks decided to diversify by exploring other areas in the food industry. The company now offers full meals that are all Filipino foods and they also offer catering services. Goldilocks goods and services on the market are of two sorts: Bakeshop (retail) and Foodshop (foodservice). The Bakeshop offers celebration cakes, breads, pastries and pies, sweets, salads, cakes, cookies, Go-lite desserts, and decorate-your-own cakes. The Foodshop is all Pinoy which includes beef menu, pork menu, chicken menu, seafood menu, vegetable menu, Sarapinoy meals, Soupinoy, Party Funfeast, and Thirst-quenchers.

Product Development
Goldilocks recently introduced new Pinoy offers: Chorizo Ensaymada, Cake-a-Bread, Chick n Buco, All Veggie Lumpia, and new wedding cake packages such as Bliss (comprised of one 3layered fondant butter wedding cake plus four round miniature cakes for sponsors and twelve polvoron cakes for guests), Serenade (comprised of one 2-layered fondant butter wedding cake plus four miniature cakes for sponsors and twelve polvoron cakes for guests), Romance (comprised of one 3-layer fondant-inspired mocha wedding cake plus six round miniature cakes for sponsors and twenty-four polvoron cakes for guests), Vow (comprised of one 2-layered fondant-inspired mocha wedding cake plus four round mini cakes for sponsors and twelve polvoron cakes for guests), and Promise (comprised of one single layer round fondant-inspired mocha wedding cake plus four round miniature cakes for sponsors). (from Goldilocks official website <goldilocks.com.ph>)

Promotions
Goldilocks has come up with different tactics in reaching their intended goals. One concerns about price offers. They do not give direct discounts on the bakeshop goods. Instead, the company (locally) offers promos like Sulit sa Bitbit (Get one Fluffy Mamon for free when you buy any three snack cakes variant OR one Cheesy Mamon for free when you buy any three ensayamada variant) and Goldilocks Decorate your cake (Party guests will do the decorating; designing their party treats with the Goldilocks Decorate Your Own Party Package). Another tactic is partnering with BPI. Shopping anywhere and enjoy Pinoy goodness for FREE with Goldilocks treats. Simply present your BPI Express Credit card and submit your original charge slip with a minimum receipt of P1,500, P4,000 and P8,000. The more you shop, the more Goldilocks treats you get. On the matter of advertising, Goldilocks has definitely created its brand values and brand identity. Most Filipinos consider Goldilocks not only a brand, but also a Filipino Institution. In fact its popular tagline, How thoughtful, how Goldilocks has evolved over the years into How thoughtful, how Pinoy, and later to Ang sarap magmahal ng Pinoy!, embracing a culture and tradition that goes beyond the name. In a few years, there came the Youre the One, Goldilocks, as starred by their major endorsers in the country, Kris Aquino and Dingdong Dantes, who gave a plausible outcome for the company. Goldilocks website features a media vault containing the companys video and print ads. It also displays schemes on having an interactive atmosphere for the viewers of the site: Sweet Moments (online sharing of photos capturing Goldilocks moments such as birthdays, weddings, etc), FunWall (posting of comments and suggestions directly), E-Cake, Widget, Wallpapers and Decorate-YourCake (application that lets you decorate the cake the way you want it, literally). Concentrating not only on the product taste, Goldilocks has separate Research and Development for bakery and dcor, to ensure its cakes are not only great tasting but also great-looking. Another groundbreaking event was the staging of the 1st Goldilocks Intercollegiate Cake Decorating Challenge in 2006. The idea behind the competition was to give college students a venue to showcase their creativity and talents.

In 2006, Goldilocks launched its delivery service Handa line 888-1-999, Isang tawag lang handa na! In 2007, the company also launched its Cake Fun Tour, an event for kids that will let them see how the cakes are made. (Euromonitor, December 27, 2010)

Production
All of Goldilocks products are produced in the Philippines. The company has food processing facility for foodservice meals which was awarded a triple A rating by the National Meat Inspection Service in 2006. For its baked goods, the company has put up a cake plant in Shaw Boulevard. It also opened an office in Cebu City that serves the needs of the southern region. Although Goldilocks Bake Shop has outlets in the foreign market like US and Canada, its retail and foodservice range are not exported. Baked goods and main meals are produced in the local country where it operates. Fresh as they are, the products are made using the same recipes and local ingredients. However, in places where there are large Filipino communities, packaged baked goods and Pinoy ready meals are exported specifically in countries such as Thailand, Singapore, Hong Kong, UK, Italy and Australia. At present, Goldilocks allows Philippine Airlines to supply baked goods to domestic and international markets. The company supplied generic burger buns for McDonalds, Wendys, Burger King and Carls Jr. when they first entered the Philippine market, but theres no recent evidence that the company manufactures for third-party brands. (Euromonitor, December 27, 2010)

Planning and Control System

Food safety and product quality are the major concerns of the company. This is the reason for Goldilocks strict adherence to quality standards and safety measures. Cleanliness is observed from the sourcing of raw materials down to the distribution of the packaged and unpackaged goods to each store outlets. In an interview, Goldilocks Marketing Director Pinky Yee said that they require sample of goods and certificate of analysis from all their suppliers regarding the microanalytical components of their goods. Assurance inspectors were also hired to do frequent check during the stages of manufacturing, packaging and distribution, from the production plants to equipment facilities and utensils. All of these are under the management of the operations department. (Dumlao, May 25, 2008) Regarding the designs and packaging of goods, the decorations department is in charge of the design-formulation out of the creative juices of its people. They make sure that the design of a specific product is aligned with the occasion or the concept that the customers would want. For the marketing of products, the research department is responsible for analyzing the market and the emerging trends, and for probing opportunities for the companys gain. Since Goldilocks has two industry lines, bakeshop and foodservice, development on these lines are left to the care of the corporate, food shop, and bake shop managers. The supervision of the outlets is the obligation of local store marketing manager, while the control of sales data is up to the sales department. All the said departments work hand in hand to achieve Goldilocks mission of excellence in products and services that surpass customers expectations.

Recent Developments
In an industry challenged by more aggressive competitors, Goldilocks must improve its bottom line, expand its market share, and improve or at least maintain its industry position. For 44 years of existence, Goldilocks have been favored by most of the Filipino consumers but the brand experiences perceptional problems among the youth. Based on surveys, most of them think that Red Ribbon is better than Goldilocks. For this reason, the company decided to make strategic rebranding. Branding is what distinguished your products from any other products around. When you do rebranding you change all the necessary materials to project your brandfrom the logo to the name and to the store concept. Accordingly, in an effort to do strategic rebranding, Goldilocks Bake Shop Incorporation undergoes major changes in its brand. It has revamped its image by replacing its curly, pale-faced girl logo to a simpler, hipper-looking letter g. The company also introduced newer look and ambiance for all its stores to make the company more relevant with the times. Recently, it has launched Luxe as its newest concept store which features a fresh, elegant, and pristine environment for clients that is far from the old-dated, fast-paced Goldilocks atmosphere. As marketing director Pinky Yee says, When you talk about brand identity, it goes beyond just changing the font. Thats just superficial. Its the total 360 degrees, from our packaging to our office and crew uniforms, the product offerings, and the store interiors. And thats what a market leader does. It does not follow trends, more than that, it sets the trends. (Imbong, October 22, 2010)