Sprinkles Cupcakes at UTD By Laura Timciuc Malu

Sprinkles Cupcakes at UTD By: Laura Timciuc Malu Crespo Tina Wei Zoey Fan Badir Al-Najjar Akram Khalil 1

Table Of Contents: - 1. Background • • Background Key Issue’s and Problems 2. Market Research • • • Market Research Competition Consumer & Buying Behavior 3. Analysis • • Segmentation and Targeting Perceptional Mapping Evaluation of Alternatives SWOT Analysis 4. Promotion • • Promotion plan Success Metrics 2

Sprinkles Background • Sprinkles is a Beverly hills based cupcake bakery chain established in 2005 and was founded by Candace and Charles Nelson. It is considered to be the first cupcake bakery. • It started in 2002 when Candace/Charles Nelson decided cupcakes needed to stop being the back up for cakes. • On April, 13 th 2005 Sprinkles opened for the first time and their first day they sold out in 3 hours and around 2, 000 cupcakes were sold that week. 3

Continued • Sprinkles have 10 locations now and plan to open 15 more including cities in London, Tokyo etc. • Sprinkles offer Vegan and Gluten-Free cupcakes, and even dog-food cupcakes. • The cupcakes are baked daily and are free from preservatives, Trans- fats, and artificial flavors. 4

Key Issue’s and Problems – There is no dessert place on campus where students can go. – Students residing on campus may not have a ride to get dessert. – If you leave campus to buy a dessert you may not find parking when come back. – Students may not have time to leave to get a dessert from out. 5

Market Research 6

Market Research - Secondary Data Sprinkles Case Study (July 13, 2009) Why Cupcakes? Why Sprinkles? - It addresses consumer’s comfort and indulgence needs. - Recession has encouraged consumers to seek comfort foods that have indulgence qualities. - Work and school stress related as well as emotional instability makes for sweet cravings. - Just like Starbucks: The Sprinkle store has a café style with a relaxed ambiance. - It it more affordable than other desserts. 7

Market Research -Secondary Data- by TLC, November 2011 10 Most Popular Cupcake Flavors 10 -) Vanilla with White Frosting 9 -) Pumpkin 8 -) Banana Best with: any berry-flavored icing 7 -) Coffee Best with: chocolate, vanilla, butter scotch, almond, & raspberry icing Why These Flavors? It is very popular and is good for any occasion It is used in Halloween parties and throughout the month of October It taste like Banana Bread and is comforting People love coffee 8

Market Research -Secondary Data- by TLC, November 2011 10 Most Popular Cupcake Flavors Why These Flavors? 6 -) Dark Chocolate It causes receptors in the brain to chemically induce feelings of pleasure. 5 -) Lemon Specially made for people that like a little sour with their sweet Best with: tangy yellow frosting 4 -) Peanut Butter Best with: peanut butter, chocolate, banana, or honey icing They are popular because they are not too sweet 9

Market Research -Secondary Data- by TLC, November 2011 10 Most Popular Cupcake Flavors 3 -) Carrot Cake Best with: cream cheese icing 2 -) Red Velvet Best with: cream cheese icing 1 -) Chocolate with Vanilla Icing Why These Flavors? Delicious, chic, and sweeter than most vegetable desserts Think: Red Velvet Cake miniature! It is trendy and has less calories than other cupcakes Classic, traditional, and popular around the world. 10

Consumer & Buying Behavior • Good amount of students living on and off campus were surveyed. • Our short survey contained six questions: 1. Have you heard of Sprinkles Cupcakes? 2. Have you eaten cupcakes in the last two weeks? 3. Where do you usually purchase cupcakes? 4. Which events would you like to serve cupcakes at? 5. Rank attributes that are important to you when you are purchasing cupcakes? 6. Circle top favorite flavors of cupcakes you prefer to buy. 11

Consumer & Buying Behavior Our results shown below after surveying student. • 60% of students have not eaten cupcakes in the past 2 weeks. Purchasing cupcakes: • Grocery stores: 55% • Sprinkles Stores: 40% • Other bakeries: 5% By opening a new location on campus we can create awareness and attract more customers. 12

Market Research Primary Data - Consumer Behavior Flavor Presentation Price Calories 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% Most important factor when purchasing cupcakes to UTD customers

Market Research Primary Data 10% Red Velvet 45% Chocolate Strawberry 35% Vanilla Top 3 flavors UTD customers prefer 14

Market Research Primary Data Holidays 10% Parties 10% Birthdays 45% Events on Campus 35% Which event would you like to serve cupcakes?

Competitors Pros • The only bakery located on campus. • Available for everyone outside campus too. • It is a branch of a known brand bakery. • Great taste & variety of flavors. • Host events easier. • New study spot. Cons • Over priced cupcakes. • Only focuses on cupcakes. • Cupcakes aren't preferable to some people. • Might target a limited amount of students. • Health conscious. 16

Competitors - cupcake bakeries - • B La Rosette Bakery 581 West Campbell Rd, Richardson 75080 • D Cake Carousel 1002 North Central Expy, Richardson 75080 • A Trailercakes 740 East Campbell Rd, Richardson 75081 17

Analysis 18

Product • Sprinkles Cupcakes sells freshly baked cupcakes every single day. • Each cupcake is made of rich organic ingredients to ensure that Price people are eating the best cupcakes. • Each cupcake will cost • Each cupcake is wrapped $3. 25. individually in a box • Discounts: • Our four main cupcakes that we 1. First 20 people on the will provide third Tuesday of every • Red Velvet month will receive a free • Chocolate cupcake!! • Strawberry 2. Buy 3 dozen cupcakes • Vanilla get a dozen cupcakes free. 3. First 100 customers get a free cupcake on opening day. 19

Place • Sprinkles will be a store on campus located in between the Student Union and the Engineering building • The inside of the store will contain a bakery where the cupcakes will be baked fresh everyday. • The inside will be very vibrant with huge glass windows to look inside. • Lots of seating will be placed for students to sit and eat. The inside will be painted pale pink. There will be several televisions for people to just relax and enjoy as well. • The all cupcakes will be placed in a glass case 20

Sprinkles New Location New Sprinkles Location on campus: In front of the Dining Hall Between the Student Union and The Engineering Building 21

Segmentation and Targeting • • Age Group 18 -22 years old College students living on and off campus Single, dating, or married People who NEED and WANT freshly baked specialty cupcakes on campus. 22

Perceptual Map 23

Evaluation of Alternatives Flavor Presentation Price Calories Total Sprinkles . 4 (10) . 3(7) . 2 (9) . 1(8) 8. 7 La Rosette . 4 (7) . 3(8) . 2 (7) . 1(5) 7. 1 Trailercakes. 4 (5) . 3(9) . 2 (5) . 1(4) 6. 1 Store Brand. 4(2) . 3(3) . 2(10) . 1(3) 4. 0 24

SWOT Strengths Weaknesses • Great on campus location near dining hall • No other dessert place on campus • Specialty flavors • Natural and premium ingredients • Gluten free and Vegan options available • Commuter school so a lot of people have cars • Most customers are on a college student budget • Cupcakes are pretty pricy at $3. 25 a piece • Cupcakes are high in fat and calories 25

SWOT Opportunities • Different organizations on campus can serve cupcakes at meetings • Offer packages to be delivered to apartments or dorms for peoples birthdays • Contests available to bring awareness • Only store on campus that sells dessert; Cupcakes Threats • Local cupcake shops within walking distance • Frozen yogurt is a healthier choice and a new fad amongst students • Cost of ingredients are increasing • The dining hall may open their own area for desserts to meal plan students. 26

Cross Reference 1. Only store on campus that sells dessert; Cupcakes. 2. Offer packages to be delivered to apartments or dorms for peoples birthdays 3. Different organizations on campus can serve cupcakes at meetings. 4. Use the best ingredients to keep the amount of calories down 27

Cross Reference 1. The dining hall opens up a dessert area for students who have a meal plan. 2. Frozen yogurt is a healthier choice and a new fad amongst students. 3. Local cupcake shops within walking distance 4. Cost of ingredients are increasing 28

Promotion

Promotion Plan Media Price Facebook Free Flyer $4250 (12500 Flyers in total $0. 34/Flyer) School New paper $2, 450 ($350 ad/month on front page of The mercury news paper. 7 month) Poster $468 (20 Poster $23. 40/Poster) Email (Zmail) Free Twitter Free You. Tube Free

Promotion plan Media Price Direct Mail $5, 400 (6 month, 3 zip codes) Discount Promotion $4680 ((1)$455+(2)$3900+(3)325) Facebook ads $2, 560 ($0. 64 per click, 1, 000 clicks per school network) Google Ad words $1, 000 (14, 800 clicks, 100 days) Local radio $19, 000(Two months) Vehicle Graphics $2, 000(2 cars) On campus Promotional Events $4, 000(1 time/semester, $2, 000/events) Total $45, 808

Sprinkles Cupcakes You. Tube page Sprinkles Cupcakes tweeter page Sprinkles Cupcakes Facebook Page

Sprinkles Cupcakes Flyers & Poster Sprinkles Cupcakes vehicle graphic

Sprinkles cupcakes ADs on school newspaper

Sprinkles cupcake On campus promotional events

Success Metrics • Breakeven $80, 000($50, 000 investment for promotion, $30, 000 capital) • Reach at least 1000 customers in the first half year. • Gain additional 2000 follower and likes on Twitter and Facebook. • At Least 15, 000 people attend on campus every promotional events that we host.

Source Reference • • • http: //www. zazzle. com/cr/design/pt-zazzle_flyer (Flyer) http: //www. zazzle. com/cr/design/pt-zazzle_print (Poster) https: //twitter. com/sprinkles (Sprinkles on twitter) http: //www. facebook. com/sprinkles (Sprinkles on Facebook) http: //www. youtube. com/sprinkles (Sprinkles on Youtube) http: //bloximages. newyork 1. vip. townnews. com/utdmercury. com/content/ tncms/assets/v 3/editorial/7/a 9/7 a 9 ce 254 -ddaf-11 e 1 -9492001 a 4 bcf 6878/501 c 3 e 3 a 99 ac 8. pdf (School newspaper) http: //www. larchmontbuzz. com/larchmont-village-news/sprinkles-cupcakescoming-to-the-grove/ (Sprinkles cupcake-coming Pic) http: //www. facebook. com/photo. php? fbid=10151908050808029&set=a. 7444812 3028. 76428. 40028693028&type=1&theater (On campus promotion Pic) http: //www. flickr. com/photos/abbearden/3679271954/ (Flyer Pic) http: //fastfood. ocregister. com/2009/06/23/sprinkles-on-wheels-cupcake-vancoming-to-oc/24967/ (Cupcakes Vehicle promotion Pic) http: //recipes. howstuffworks. com/food-facts/10 -most-popular-cupcakeflavors. htm (Secondary Data for Market Research) http: //www. marketresearch. com/map/prod/2391899. html (Sprinkles Case Study)

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