1 Introduction

A blend of coffee and conversation never seemed to amaze the customers who go to Old Town White Coffee. Famous for its white coffee, the coffee chain started business in 1999 under the name of White Cafe. Rapid developments have seen the business expand into exporting homemade white coffee to neighbouring countries alongside expanding the product line. Not to mention the fact that the coffee chain has shops literally all over Malaysia, more precisely Kuala Lumpur, Pahang, Perak, Penang, Sabah and Sarawak The level of expansion has been equally matched with anticipating quality required by the customers of the business. From the simple but unique taste of the coffee - to the free WIFI in each store shows promise of delivering to customers graciously. Our assignment is based on an Old Town outlet situated in Taman Connaught, Cheras. Established in 2007, the location for this outlet was seen ideal as there was an educational institution, UCSI, nearby. From the inception the response has been immense from the students, families and workers. With the interior designed to provide a soothing serene atmosphere, the cafe is situated in a small shop lot. We managed to interview the outlet manager to shed light on key areas of the outlet: marketing environment, SWOT, STP, marketing mix and actions and analysis.

2.1 - Macro environment

Looking at the customer segmentation for this specific outlet, a whopping 80% consists of Chinese the rest being Malay and Indians [Annex I]. The year 2008 saw all outlets of Old Town White Coffee comply with Halal in order to cater to the largest community the Malays. Nowadays its the trend to see mostly younger generations spending time in coffee shops either conversing with friends or working on school work or even simply browsing the internet with their computers, with a cup of coffee by their side of course. This is the scenario in this OTWC shop as well. The customer base also includes employees from the business community situated around the store. The distinguished uniqueness of the food offered at Old Town White Coffee shops differentiates them with other Food & Beverage chains in Malaysia. Very good examples would be KFC, McDonalds and Secret Recipe. All of them are considered as competitors although the menus offered are vastly different from that offered by Old Town White Coffee which comprises mainly of local foods at reasonable prices compared to the menu offered by the previously mentioned chains. At a time where technology is overtaking almost all aspects of business, Old Town White Coffee has also welcomed changes in this area. A key example is the touch screen system used for sending orders to the kitchen, and POS system for the payment.

2.2 - Micro environment

The factors influencing the business include the suppliers, marketing intermediaries, customer markets, competitors, and publics. These factors directly affect the Old Town White Coffee performances and the decision making. Mission To let everyone enjoy every sip of authentic Malaysian Ipoh White Coffee, anytime, anywhere

Vision
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Old Town White Coffee vision is mostly highlighted to promote their unique Taste and to deliver their best. (Old town white coffee) To promote our unique Malaysian Taste the authentic Ipoh White Coffee and Continue White Coffee Legacy through continuous improvement and innovation that exceeds customers expectation As Market Leader, we take pride in distinguishing ourselves to be ahead of the pack. By setting precedence, we have made a standard that equals excellence, pushing other brands to do the same We strive for continuous improvement, incorporate innovations and technology in our commitment to create customer value in our both products and services Aligned with transparent policies and achievable targets, together with our core values, we are able to move forward as one responsive team and deliver our best SWOT analysis

A SWOT analysis helps in analysing a business in regard to decision making. The chief strength we uncovered is the undeniable brand loyalty among the customers. Due to the differentiated menu offered in OTWC chains, weve found out that customers specifically come to the shop for specific dishes, unoffered in other food chains. The next biggest strength is the competitive prices offered in terms of the quality of food being offered. Customers deem OTWC delicacies well affordable, healthy and delicious. The most comparable example would be Starbucks Coffee. Even though OTWC and Starbucks have differentiated coffee product lines, both offer quality coffee but at two different level of prices. Weaknesses Two weaknesses exposed include the lack of customization on the choice of food and the language barriers faced by staff in communicating to customers. Customers have raised their views on customization of certain menu items as to their preference, but due to the fixed computerized system and pricing, the shop has been unable to deal with this yet.

With regard to the latter issue, most of foreign workers hired by OTWC are foreigners and thus lack good communicational skills. This could be improved by giving customized language training programs. Opportunities Opportunities for the company include the expansion of our coffee retailing beyond the current scope and the very obvious fact of expanding the number of OTWC shops locally and regionally. Threats Considering the threats to the outlet, a significant threat was uncovered. The outlet is located near a lot where a big night market is held every Wednesday. Thus potential customers choose to dine at the market rather than at the shop. Other threats include the lack of professionalism amongst the staff. This has the potential to kill off customer approval ratings for the shop. Furthermore, hiring international workers are gathering negative interest from local potential workers looking for jobs. Companys STP When marketers want to designs customer-driven marketing strategies, they must first decide who it will serve. Through market segmentation, a business can focus on the particular market segment which in turn would help in catering to their specific needs. Market targeting refers to the segment a business decides to cater to. In this step, marketers will evaluate the market segments attractiveness, segment size and growth, and company objective and resources in order to gain advantages over competitors.

Market Segmentation & Target Market In Malaysia, there are three major ethnicities; Malay, Chinese, and Indian. The Old Town White Coffee market caters to 80% Chinese, 16% Malays and the rest Indians. The demographic segmentation is most easily categorized in to children, students and youth, workers and senior citizens.

The distinguished needs between these segment groups are diverse. Students are seen as low income earners, thus menu items include acceptable prices for them. While workers are considered as income earners and come in groups and have limited time to enjoy their meal, this also has to be taken in to account. Local delicacies are included in the menu to suite the likings of old timers, while set menus are provided for families. Every day the cafe is full during breakfast and lunch hours. A few solid advantages Old Town has compared to alternative cafes nearby is the fact that they provide a good, clean environment the breakfast and lunch promotions along with the low pricing with the additional fringe benefit of WIFI. Market positioning After target the market, we have to differentiate our products and position ourselves in the market. Old Town always advertise their product with slogans like Malaysias No.1 confirms best White Coffee. And according to the manager, nowadays new customers easily remember Old Town is associated with White Coffee and it has been observed that new customers order classic drinks white coffee.

Companys marketing mix Marketing mix Marketing mix is an important tool in matching the demand anticipated by the business. We will be analysing the four Ps of the marketing mix in application to the Old Town shop we have chosen.

Product The key product the shop focuses is the coffee product line. They offer 3 different coffee classes the OTWC 3 in 1 blend, Nan yang White Coffee O, simple pure white coffee ready to drink product.

The original white coffee is from Ipoh. They serve the fresh and true product to the customers and make sure customers feel the best taste from the white coffee. The food line of products has local, classic and sweet delights alongside hot and cold beverages. Classic dishes are for the customers who need a normal component meal just like Rendang Chicken Rice, Chicken Hor Fun, Nasi Lemak special and so on. Local flavors and Sweet delights include Signature toast, Savoury starter, desserts and others. Beverages included the series of origin white coffee, old town iced cold coffee and tea, smoothies and so on. Place To position the place of a company is an essential element for a business. The outlet of OTWC weve chosen, the placing of the outlet can be said as an ideal location. The outlet is in a quite developed area with a university and a local Bank (Maybank) so close by. Also the bus station is quite nearby this outlet. Thus it provides an optimal place for a coffee shop. An overall placement analysis on the coffee chain shows, due to the large number of shops scattered across Malaysia placement is good. Brand loyalty is strengthened amongst customers who often travel locally. Furthermore the Old Towns Coffee packs are available in hypermarkets, the likes of Jusco, Giant & Tesco.

Price The prices offered in the Cheras outlet is lower compared to OTWC outlets in famous business centres such as Pavilion, Genting Highlands and LCCT. Plus in comparison to other food chain rivals, the pricing is more cheaper. With the given promotions, it can be said that the outlet is justifying hard in pricing decisions that will benefit customers even more.

Promotion The purpose of promotions is seen as a way to make customers differentiate the Old Towns experience. Three promotions are held daily, at tea time, 3pm-6pm, and a promotion for the whole day. While the whole day promotions include certain flavours of noodles, the tea time has light snacks and the 3pm promotions have full meals. New menu items are introduced through promotions at reduced prices to collect feedback. Proudly adding, the coffee chain is well advertised on the local media, Astro, quoted as a coffee chain with Malaysian Pride.

Actions & strategies Product Old Town offers a wide variety of products to serve its customers. Based on the Managers remarks and our survey, the main eye catcher in Old Town at Taman Connaught is their awardwinning White Coffee. The coffee originates from Ipoh, Malaysia where they are naturally brewed. This could be the main reason for the strong and natural flavour for the coffee. Although we do recommend, the serving size of the coffee to be improved as it is compassionately less now. Nasik Lemak which is the clear next favourite and we recommend it would be good idea to broaden the Nasik Lemak line by offering unique side dishes, perhaps pastries and home made desserts. Furthermore, we have found that many customers who take coffees also take the Kaya Butter Toast which is considered a snack. This bun is very crispy and the butter is made from a well recognised bakery in Malaysia. Thus it has high demand. It could be a good idea to offer additional snack options. Price Price being the key and initial factor customers would consider, Old Town White Coffees pricing is decided taking in to account key competitors such as Madam Kwan, Pappa Rich and more. Thus the pricing is reasonable and acceptable.
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Moreover the promotion packages are economical compared to ordering single items from the menu. A very good example is the breakfast set which includes one coffee, half boiled egg and toasted wholegrain bread with golden melted butter, priced at RM4.50, add 1 more ringgit and the customer can choose a drink from either white coffee or ice lemon tea. More pricing strategies were to be seen as we reviewed the promotions. The 3pm 6pm promotions offers 20% discounts on certain items, while other pricing promotions include the buy one get one free and lower prices being offered to students. Place As said before the location is seen as ideal for business. With the nearby businesses and the university almost next door, the current location is seen as ultimate location. Although with the anticipated demand through peak hours, it could be an optimal move to further expand the current shop. This could match the high demand further improving the brand loyalty. Customers have found it most convenient to stop over for a quick lunch or snack after visting the bank or nearby businesses. Thus there is little argument against the current placing. In order to deal with the night market situation as previously stated, we recommend the shop to come up with a new promotion to draw in customers on that particular night. Perhaps matching up to the prices offered by the night market, it would help to cover the shops fixed costs. And lastly we suggest it is a good idea to promote the shop a bit more around town. Even though high demand is met in peak hours, there is relative space for more customers during the evenings. This might attract the local demand a bit more. Promotion In terms of promotions being undertaken, we think there are numerous promotions. From the promotions offering different flavours of noodles for any day to the most recent one of early bird breakfast promotion, there is always some promotions customers can choose from. We recommend the shop to come up with better promotional offers during the evenings as there is additional capacity to accommodate more customers. As said before these promotional strategies should highlight the need to amend the issue of the night market as well. A suitable idea is to create membership cards to customers so that customers would feel more at home and this is turn could hold customers off going to rivals.

Conclusion The areas being stressed on in this assignment are the companys marketing environment, the Swot Analysis, STP, marketing mix and actions & analysis. The market environment described how external and internal factors within affects the drawing of customers to the restaurant. Moreover the business has established its performance within the regional market. Even though the shop offers the classes along the lines of classic food, there seems to be lack of customization to suite the customers ever changing desires. This might have to be remedied soon enough to draw in newer customers, especially the young to middle aged customers. The reason weve highlighted this segment is because this is the segment which raises the issue for the shop to differentiate and customize the menu being offered rather than the aged group. Additionally, it has been found that Old Town Coffee in retail shops and hypermarkets does not do too well compared with the other coffee brands such as Nescafe. It seems almost impregnable to break in to newer customers. Accordingly we acknowledge this is a high priority situation that has to be remedied. We propose the chain/shop to setup free sampling booths in hypermarkets, and on the spot promotions signifying to the customers clearly the major difference in prices compared to rivals. With these things taken care of, the business would find itself in a stronger position than it already is, in the target market. A bit of professionalism needs to click in to place continue on being on the frontier of the coffee line. That would indeed match the desires of the customers, with the matching promise of delivering to them truly.

Microenvironment
The microenvironment concerns the internal factors influencing a business directly. This could be either, suppliers, marketing intermediaries, customer markets, competitors, the general public or the authorities.

The company
A business has always set objectives, mission and vision statements. These help in motivating the employees to work towards the set goals. Objectives include the set sales targets that the staffs work hard to achieve. Or simply to continue serving the unique service and food of the Old Town White Coffee.

Suppliers
Suppliers are an adamantly important group. The few suppliers of Old Town include Netron Plus sypplying ham, sausage and Omega egg, Spritzer supplying mineral water, Nesley supplying ice cream, and SCS supplying butter to the coffee chain. These are well established suppliers within the market hence the gaining of trust of our customers.

Customer markets
There is no specific market segment to which our focus shop wants to deliver to. But it is not the case when majority of the customers are students. Consequently the pricing, promotion strategies have been adopted after strictly reviewing the different demand segments.

Competitors
Even though there are well established brands the shope is competing against, such as KFC, McDonalds, Madam Kwan, its relatively safe to say that the main competitor for Old Town is Secret Recipe. Though the product line is difference, and the pricing of Secret Recipe sky high compared to Old Town.

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Three Major Nation Percentage

Indian 4%

Malay 16%
Chinese Malay Indian

Chinese 80%

Market Segmentation
Senior Citizens 1.5% Family 13% Students 40% Expatriate 0.5%

Students Young Adult

Officers 17%

Workers Officers Family

Workers 16%

Senior Citizens
Young Adult 12%

Expatriate

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