Ice Fili – Russian Ice Cream Market
Essay Preview: Ice Fili – Russian Ice Cream Market
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Ice-Fili, one of Russia’s top ice cream producers, is a great example of a mid-size company beating the odds and becoming successful in a very tight controlled regime. It even managed to outlast well established international companies such as Ben & Jerry’s and Nestle. It did so by understanding the power of competitive advantage and knowing what the consumers wat. Some of the challenges to creating a competitive advantage in the Russian ice cream market is the high threat of new entrants into the market. Not only were regional producers entering the market, international producers were coming in as well. These international producers were trying to label their ice cream as “Russian ice cream” when it fact, it tasted more like western-style ice cream. So Ice-Fili and other regional producers came together and forced a new standard that determined the minimum amount of real milk, butter, and other ingredients that must be used to classify as “Russian ice cream”. This standard was imposed to ensure that consumers were not being misled by the use of milk and butter substitutes used by international producers. Ice-Fili also created competitive advantage by creating a Blue Ocean strategy. It introduced a new ice cream that attracted new consumers to the brand that weren’t allowed to enjoy it before. The company innovated a diabetic ice cream to appeal to the 140,000 diabetics in Moscow alone. This brings in new consumers to the ice cream market and since Ice-Fili was the first and one of the only companies to sell a diabetic-friendly ice cream, they don’t really have any competitors in that section of the market.
Ice-Fili has done a great job over the years differentiating itself from the rest of its competitors. The company has adapted a variety-based positioning strategy. The company specializes in ice cream and offers a variety of different flavors and products to meet the need of a cold dessert craving. Because Ice-Fili only focuses on ice cream, it is able to focus on that and create great tasting flavors with high-quality ingredients. It also allows them to offer a wide variety of flavors and products to meet the needs of the customer, whether they need a family-sized product or just a single-serving. As mentioned earlier, they have also met the needs of diabetic customers by offering an ice cream product specifically for them, which also places them in the needs-based positioning strategy. When it comes to analyzing relative costs between Ice-Fili and other regional producers, Ice-Fili spent more on almost every aspects of costs from ingredients to manufacturing to marketing. Ice-Fili prides itself on using high-quality ingredients, which means it has to have a higher retail price, almost twice as much compared to other regional producers. Ice-Fili also tapped into the marketing field, which was virtually untouched by producers in the Russian ice cream market, which gave them an advantage. One advantage for some regional producers was the lower production and labor costs because of the construction of new facilities.