Vosges Brands: Fill Two Marketspaces

Hybrid Strategy
As for Vosges chocolates sold in other retail stores, the demographics and lifestyle of the store’s patrons are key factors in the movement and sales of the product. Given the broad range of its product line and the holes in the chocolate market, Vosges can use a hybrid strategy and “pick off” the very high-end “niche” space with its truffles and $300 Bamboo Boxes by continuing to sell in retailers like Bergdorf Goodman. But their most substantial opportunities lie in the huge marketspace gap between Godiva and drug store chocolates. This mid-range affordable luxury area is already evidenced by the success of their top-selling $7.50 milk chocolate bar infused with Applewood-Smoked Bacon. Vosges needs to continue to develop similar types of products to capture the affordable luxury mid-range chocolate, and partner with appropriate channels like Whole Foods. This will dramatically raise the brand awareness, and more importantly, make the brand more accessible to a large variety of consumers. This is where Vosges’ greatest growth opportunity lies, and less so than with ultra high-end products.

Be A Wider Ranging Affordable Luxury
Katrina Markoff’s goal for Vosges Haut-Chocolat to be an affordable luxury like Marc Jacob’s apparel brand is appropriate, smart, and obtainable. Wisely, she initially based her product line on out-flanking high-end chocolates like Godiva. This strategy raises awareness in this marketspace, but not with mainstream consumers. To become a more widely-known brand and to grow substantially beyond its $12 million in revenue for 2007, Vosges should develop a wider ranging product line for the gap between high-end chocolates and drug store chocolates. This will not dilute its brand, but enhance its equity and reach. Vosges should leverage the wide reach of appropriate retailers like Whole Foods to dramatically increase volume, sales, and profitability. There are very few players with high brand awareness in this space now – can you even name one? And, are they national? Vosges can own two spaces simultaneously, and use both to enhance and leverage the other. By pursuing this hybrid strategy, Vosges would become even more well-known than Marc Jacob’s in clothing – and possibly develop a loyal customer base like Starbucks. This space owning strategy is an excellent fit for Vosges to build its niche and broaden its appeal. And for a chocolatier – how sweet it is!

Vosges Haut-Chocolat Looks To Own A Chocolate Marketspace

The Start
Ten years ago, Katrina Markoff started Vosges Haut-Chocolat in Chicago to make and sell premium quality chocolate. During this time, Vosges has moved from a tiny start-up to a well-known, high-end chocolate brand with revenue over $12 million in 2007. It is based in Chicago and has 80 employees. Vosges is known for its chocolate bars and truffles made with exotic, unexpected flavors. Katrina Markoff’s company is looking to own the very high-end marketspace in chocolate. Katrina decided to pursue this space when she realized that the two major areas that chocolate manufacturers occupied were the high-end which Godiva owned, and a lower-end which was one step up from drug store chocolates. She decided to out-flank Godiva on the very highest level.

Location and Marketspaces
Vosges Haut-Chocolat has five stores: two in Chicago, two in New York, and one in Las Vegas. In addition, Vosges is opening a store in Los Angeles. As with all retailers, location is critical to success. Because Vosges is a very high-end product, store locations are even more important than normal. For Vosges, geography is a critical access point to its marketspace. It is a paramount factor to gaining consumers willing to pay premium prices for chocolate. All its store locations need to link geography to a luxury-seeking demographic. In my white paper, “Innovating Your Marketing Strategies”, I talk about this Kaleidoscope marketspace factor. In this case, geography links directly to demographics, and dictates the ability to sell a certain kind of item at a premium price point.

The Two Key Ingredients For Vosges’ Stores
Vosges needs one of two ingredients for the success of its retail locations: high foot traffic or to be a point of destination. For its Chicago and New York stores, Vosges seems to combine both, with high foot traffic areas and high-end locations. Although the New York locations are relatively expensive, the exposure and awareness gained for the brand justify the costs. As for the upcoming Los Angeles store, it must be in a destination location, because this market does not have a lot of foot traffic. Geography (as it relates to the demographics of foot traffic) is vital to the Chicago and New York stores, because it dictates the likely customers. This is vitally important to Vosges because theirs is a luxury product with a relatively high-price point – it can’t be situated just anywhere. The Las Vegas store does not seem to have either of these elements working strongly in this way. One might argue for Vosges to emulate the Starbucks model of trying to market a ubiquitous affordable luxury with its own locations in geographies with mid-range demographics. However, the nature of the product as a non-staple food item, and relatively non-habitually consumed, makes it unlikely to be successful in non high-end locations.

Spanx Owns Marketspace Through The Blue Ocean

“Blue Oceaning” A Tired Industry
Spanx has succeeded in reviving a tired industry by casting it in a fresh new light according The Wall Street Journal’s August 7th issue.  A la Blue Ocean strategy, Sara Blakely and Spanx have rendered the competition irrelevant by transforming the grandmotherly product of shapewear into cool and hip.  It has raised the dimensions of packaging and image, created the new dimension of invisibility and fit, and infused emotion through coolness.  This has enabled Spanx to own the high-end marketspace of designer clothes wearing women. 

Connecting To A Space Through Two Dimensions: Useage and Demographics
In line with the strategies outlined in my forth-coming book, Owning Marketspace, Sara owns two space factors/dimensions: usage and demographics.  The usage type and occasion of the product are key – seamlessness and shapeliness under pricey garments typically worn when “going out” or for special events.  Spanx captures a younger, fashion-conscious demographic. Both these dimensions are critical to developing this Blue Ocean for this business, and Sara Blakely has deftly, coolly captured this marketspace. 

I am willing to talk with blog participants live via phone for free consultations.  I am also available to companies, businesses and organizations for consulting engagements and speaking opportunities.  For any of these request, E-mail me .  I will help my readers in any way possible – I want to share my knowledge and expertise.

Mike Bolden marketing expert and blue ocean strategist – writing to inform, enlighten, and inspire.  Author of forth coming book, “Owning Marketspace”.  Available for consulting and speaking engagements.

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