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.