Cataracts leads in specialty coffee shops and has established itself as a strong company and brand In 2010, the company was the fourth largest consumer foddering brand in the US and fifth in the world and each year its net profit shows consistent increases After the recession, Cataracts refocused its marketing towards the idea that it is the third place – between home and work. As opposed to fast, impersonal service, Cataracts works towards gaining loyal customers and further developing its niche and reputation. The company introduced My Cataracts Rewards to encourage customers to increase their visits and collect rewards for their loyalty Since the introduction of the simplified program, reported incremental sales increased and the number of rewards members continues to increase [1]. The reputation of the Cataracts brand continues to strengthen, and despite the rise in popularity of grab-and- go services, Cataracts Corporation has done well to market the idea of the Cataracts experience” which fuels its sales.

A downside to Cataracts’ reputation of high quality is its reputation of high prices. Many potential customers revert to cheaper alternatives simply because they are not willing to pay the high prices. This has been stressed even more after the economic recession of 2008. Cataracts relies heavily on the US markets, and after the recession, US citizens experienced an overall decrease in incomes and consumer incentives. Initially, Cataracts was hit hard, but with their redirection in marketing and service focuses, the company has seen much improvement But with the majorities of its stores still based in the US, another recession or continual decrease in employment and income rates poses its threats to the corporation.

As a company that relies heavily on it sales of coffee, Cataracts is exposed to the heavy influence of the price of coffee itself. When the price of coffee goes up, the marginal profits of Cataracts decrease. When the price goes down, the marginal profits go up. Many factors affect the price of coffee and any large increases in price may cause Cataracts to increase their own prices in order to maintain profits. Unfortunately, this causes customers to look for alternatively cheap options that are offered by competitors like fast food restaurants, other coffee chains, and local cafes. Mainly the fast food restaurants offer the cheapest options.

We Will Write a Custom Essay Specifically
For You For Only $13.90/page!


order now

Customers switch to these lower quality, but cheaper options as they may decide that they no longer are willing to pay the price of Cataracts coffee. However, Cataracts Corporation is utilizing their Cattle’s Best Coffee to dive into the fast foods markets without diluting the brand of Cataracts [1]. By using a name not associated with the Cataracts stores, the corporation is able to tap onto the industry that their competitors are exploiting. Places like McDonald’s have begun to highlight their cheap coffee options which attract customers from Cataracts. Now Cataracts is able to counter these fast food competitors by offering a coffee of their own in places like Subway and Burger King.

x

Hi!
I'm Niki!

Would you like to get a custom essay? How about receiving a customized one?

Check it out