Edexcel IAL Business 1.3.2 The Market

Sources for use with Extract E Niche brands are increasing their mass market appeal In the last 10 years there has been an increase in the number of health and well-being brands moving from a niche to a mass market. Many health products are benefitting from increased revenue, due to growing consumer desires to live healthier lives. These brands are no longer viewed as exclusive products and are now purchased by more customers each year. One of these brands is Pukka, which sells premium priced speciality tea. The global speciality tea market is predicted to grow by $50bn between 2021 and 2026. Extract F About Pukka Pukka sells a range of speciality teas including herbal, organic and fruit teas. Entrepreneurs Sebastian Pole and Tim Westwell launched Pukka in 2001. Sebastian had been interested in plants and conservation for many years. He was determined to follow his dream to start a business selling a healthy product. Sebastian saw an advertisement of Tim’s which offered to help start up an ethical business. They agreed to meet to discuss their ideas and Pukka was formed shortly afterwards. From the first moment Tim and Sebastian met, they were the perfect match. Although they had completely different personal skills, they shared a common marketing objective, to create a business that would benefit the health of people. Tim had 10 years’ experience as a business management consultant. They spent many hours in Tim’s house planning their future strategy. They worked evenings and weekends to turn their ideas into a successful business.

Sources for use with Extract D In congested Istanbul, companies get goods to you fast There has been a rapid growth in the demand for shopping services in Istanbul, Turkey. These on-demand services are expanding because transportation can be slow. Businesses are making use of new technology, wages are rising and more people have access to smartphones. Shopping services such as Kapgel and Getir offer innovative delivery solutions to meet the needs of their customers. Both firms have different approaches, but aim to meet people’s immediate needs and develop customer loyalty by using technology to develop apps and deliver goods as quickly as possible. Kapgel has designed an app to allow customers to shop from a wide number of stores and supermarkets. The customer creates a basket of goods on the app and a delivery person shops for these items and delivers directly to the customer. Deliveries are made within one hour for a delivery fee of 5 Turkish Lira (US $0.85). Kapgel does not keep any stock and uses part-time and temporary delivery people, rather than employing workers on a permanent and full-time basis. Getir owns many warehouses around Istanbul to stock over 1,000 different products, including food items and small electrical goods. Customers select from the 1,000 items using an app on their smartphone. Getir employs over 350 people for this delivery business and have an average delivery time of 9 minutes and 6 seconds. Unlike Kapgel’s delivery fee, Getir adds a cost to each product. It has a minimum shopping total of 15 Turkish Lira (US $2.55) before it will deliver an order. Extract E BiSU Water Delivery In Turkey, most tap water is not drinkable. Delivery services in the past were slow and not well organised. On-demand delivery services such as BiSU have changed the water delivery market in Turkey. Customers can now order water using an app on their smartphone. They can have it delivered quickly and at a time to suit them. BiSU has a large team of delivery drivers. The business was launched in 2015 and has expanded to many cities in Turkey, receiving over 100,000 orders a month from 38,000 users. Water prices depend on the brand requested and the region the water is delivered to.

Sources for use with Extract A The Ice Cream Market The global ice cream market value is expected to reach $89bn by 2023 and is attracting many new businesses to the market. Unilever dominates the global market with a 22% share. It owns 8 of the 15 top selling brands. Its brands include Magnum, Cornetto and Ben & Jerry’s. Nestlé is Unilever’s closest rival having 4 brands in the top 15. The sales of low‑quality ice cream have been declining, due to the increased demand for premium ice cream. There are many factors contributing to the growth of the ice cream market. These include innovative flavours and the rise in incomes. Niche markets are developing to cater for an increase in demand for organic and naturally sweet desserts. There is an increase in demand for ice cream from consumers above the age of 50. Extract B Oppo Ice Cream Everyone loves ice cream. We all know it is a delicious treat but know it is not a healthy one. However, a business called Oppo has created an ice cream with 60% fewer calories and less sugar than standard ice cream. Oppo claims that one portion of its ice cream contains fewer calories than an apple. Brothers Charlie and Harry Thuillier came up with the idea while on holiday in Brazil. When they returned home, Charlie left his graduate job to dedicate himself full‑time to developing a healthier ice cream. During their primary market research the brothers used two methods, interviews and product trials. They interviewed people who worked in the ice cream industry including a leading industry professional named Gary Martin who had worked on the Häagen‑Dazs ice cream brand. After months of experimenting with different recipes, Charlie and Harry developed a winning recipe that replaced cream and sugar with fresh milk, coconut oil and stevia leaf. Oppo initially conducted product trials in a few supermarkets to test if the product would sell, and now the ice cream is stocked in over 1,600 UK stores. After two years of hard work in Harry’s kitchen the brothers had achieved what they set out to do. Even though they were told by some industry professionals that they would not succeed, the pair persevered and their determination paid off. The business is now continuing to grow and is expanding internationally.