EXPORTING

PEANUT BUTTER
TO CHILE

Team 2: Claudia Icochea, Melissa

Gunther, Rebecca Wall and Stefanie
Wilfong

Product features
The containers of peanut butter in two
presentations will be the first in a plastic
jar (similar to a tomato sauce jar) in a
pack of 500 grams.
This product presentation will be in a
plastic cup which will have a label with
the product name, barcode, label it will
further product information, necessary
for consumers.

MISSION

The company is engaged in the

production and marketing of Jif
Peanut Butter, giving customers a
product of excellent quality with a
high nutrient content at an affordable
price, providing the satisfaction of all
consumer needs.

LABELING

Products commercialized in
Chile must be labelled with:

The name or registered

brand
The address of the producer
or importer
The country of origin
Care instructions

Information must be
provided in Spanish.

If product has a high

percentage of sodium, it
must be shown in the label

PROMOTION STRATEGY
Advertising, which is any paid form of
non-personal presentation and
promotion of ideas, goods, or services
by a well-defined sponsor.

The American influence in Chile will

help expand the knowledge of peanut
butter, even if Jif itself is not a wellknown brand in that country.
Walmart Chile - Walmart Chile
operates several formats including
hypermarkets, supermarkets, and
Ekono convenience stores.

MARKETING OBJECTIVE

Goal for Jif Peanut Butter within One Year

Launch a new product into the Chile market
Gain market share and control most of the
market - limited competition in Chile with peanut
butter
New product will be designed to accommodate
the local tastes of the Chilean culture
Appeal to consumers as a desirable and
affordable product
Everyday staple item for customers to enjoy as a
new healthy option in every household as well as
businesses and restaurants
Establish customer loyalty and brand recognition

E-COMMERCE
National e-commerce will exceed two
billion dollars, with annual rates growth
from 20% to 30%.

The popular online purchases include

electronics, tickets to concerts or events,
and plane tickets.
Most popular internet sites:
Lan.com (popular airline)
Fallabella (retail store)
Mercado Libre (equivalent to
Ebay).
Coupon shopping:
Groupon, Cuponatic
Lets Bonus
Agrupemonos.


USERS

In Latin America, the background described shows

the existence of gaps in Internet use at both gender
groups and even intensify in rural areas, or by level of
education or income.
UM Chile stated, In 2012, only 3% of Chileans used
mobile devices for e-commerce and only 70% of the
population owned a computer
AGE GROUP:
In Latin America the highest percentage of the
population, 32.5%, is concentrated in people between
15-24 years of age.
In Chiles case, this age group actually represents
39.8% of the countrys population, while only 24.7%
is between 25-34 years old.

MARKETING ENVIRONMENT
Jif must consider the external factors that the
Company will be facing and, will then need to take a
passive approach when entering the Chilean market
by adapting their product to meet the needs of the
consumer.

Micro-environment
It is imperative that Jif hires and trains a strong
international sales team to build long term relationships
with the retail stores that will be selling their product in
Chile.
JIF should consider engaging in co-branding with grocery
stores currently in Chile.
Jif needs focus marketing efforts not only on inducing
consumer trial of peanut butter, but also on creating
brand recognition to keep their specific product in high
demand at retail stores.


Macro- Environment
Social Factors

The large amount of potential consumers presents a huge

opportunity for Jif if the Company chooses to enter this market.
More than 17.8 million people live in Chile, which makes it home to
over .25% of all of the Worlds peoples.
Economic Factors
As reported by Euromonitor, there has been an increase in the
amount of disposable income for Chilean consumers.
As the economy continues to increase, retailers in Chile are eager
to diversify the range of products that they have available for the
consumer to purchase.
The convenience and grocery stores in Chile are looking to satisfy
upscale consumer demand for diversification and, the highest
demand is for snack foods and on-the-go items.


Legal and Trade Factors
Chile has a relaxed import policy with lose international trade
restrictions, encouraging goods to be imported and traded openly.

Relatively easy market to enter as there are currently no import

quota limits, pre-shipment inspection laws, or strict licensing
regulations.
Companies that import goods to Chile and net over five million
dollars in a financial year must share financial information to the
Central Bank of Chile, but there are not any limits on the amount
of currency that can actually be taken out of the country.
While importers are not limited by strict registration rules, Chile
does require each company importing items to staff a customs
broker who is responsible for entering the product if the resale
value is over $500 US dollars.

MARKET ENTRY STRATEGY

Directly export Jif peanut butter that is appealing to

the local tastes of Chile
Benefits of Exporting to Chile
Minimal risk - Does not require Jif to invest and
commit to purchasing a production facility
Capitalize on the open trade agreements between
Chile and the United States
Quick market entry
Gain higher long-term profits
Stronger relationships with Chilean buyers
More control over the exporting process

COMPETITIVE MARKET ANALYSIS

Challenges and Threats of Entering the
Chilean Market

It is vital that Jif works to build brand

recognition throughout Chile, so that if
similar competitors chose to follow Jif to
Chile, Jif will already have a connection
with the consumer to help them maintain
market share.
Jif must work hard to differentiate their
product from other comparable items by
creating a strong marketing campaign and
advertising the unique product attributes
of the peanut butter.
However, Jif should also consider using
price differential strategy to compete in
the open Chilean market by altering their
profit margins to remain competitive with

Threat of Substitute Products

Currently, the only direct substitute product for
Jif peanut butter in Chile is the generic or store
brand peanut butter that is offered in grocery
stores and the Chilean Walmart.
Jif should brand their peanut butter by
marketing the product as having superior
quality and promoting the health benefits of Jif,
as compared to substitute products, thereby
justifying a higher price.
The competition should not only be defined by
other nut butters, but also by all alternative
companies who distribute sauces, jams, and
butters.

TARGET CONSUMER MARKET

AND
PURCHASING BEHAVIOR

As Reported by Euromonitor, the Chilean consumers

are purchasing over fourteen billion dollars of
packaged foods that are currently being imported from
other countries, including the United States.
The majority of Chilean consumers have recently seen
an increase in salaries and in disposable income,
encouraging grocery retailers to diversify their
products to include luxury items and introduce new
products.
The Chilean consumer is now more aware of potential
health issues caused by poor eating habits such as
obesity, high blood pressure, and diabetes
Chileans are not used to the sweetness of peanut
butter, so it is important that Jif alter the recipe of their
product to decrease the sweetness and adjust to the
taste of the Chilean consumer

Establish and organize an

international department within Jif
Managers will report to the Jif
sales and marketing team
International department is to be
well equipped with practical
knowledge of the Chilean culture
Committed to extensive research
of the country and culture to
develop a confident product and
marketing strategy
Must speak Spanish
Overcome the language barrier
Ensure communication is clear
and understandable, especially
when conducting business

GLOBAL PRICING &PRICING DECISION

Price is a very important factor due to the open and competitive climate in
the Chilean market.
Companies that choose to import their products into Chile must be as
competitive as possible with price, and adjust their margins in order to
compete and gain market share
Option of switching focus from price to added value by differentiating the
product from all other available substitutions
Jif would need to connect with the customer that they are serving to
justify the higher price
over 25% of the Chilean population is obese and they are willing to
pay more money for healthier substitutions that are more natural
and will contribute to their overall health and well-being according to
the Organization for Economic Co-Operation and Development
The average Chilean is working much longer hours. They are willing to pay a
premium for healthy pre-packaged food items that can be easily consumed
on-the-go
For an 18oz. jar, just about 500 grams, Jif should charge about 1,680 CLP,
which is in line with the current price in the U.S.

CHANNELS OF DISTRIBUTION

Before the product is authorized to be put on

the market, Jif must follow the protocol of the
country and receive approval from the Chilean
health authorities to receive a registration
number and open sales permit
Jif international department to develop business
relationships within Chile for access to buyers
Trade and service activities most commonly
managed at the capital, Santiago.
Best channel for Jif to use is the seaports as
97% of exports in Chile go through this
successful method
Once product is exported, ground transportation
will be coordinated to distribute the product to
supermarkets, markets, convenience stores and
businesses around the country.
Jif distribution will concentrate on business to
consumer and business to business strategies.

..
Product distributed to supermarkets, markets, convenience stores
and businesses around the country
Jif will distribute to the leading supermarkets and hypermarkets in
Chile such as Wal-Mart Chile, Cencosud, Unimarc and Tottus
By entering the market with well-known supermarkets, the product
will be marketed effectively and offered on a favorable scale
Sales in supermarkets and hypermarkets reached $17.9 billion in
2013 accounting for 62% of the market's overall value
With the recent rise in disposable income of Chilean consumers, a
wide variety of products are now being offered in grocery retailers
As peanut butter produced by the United States is rare in Chile, the
recent purchasing trends of consumers support the market entry of
Jif peanut butter in grocery retailers all around the foreign country
In addition to supermarkets, Jif will provide this product to
businesses, restaurants and specialty shops to further penetrate the
market and develop prosperous partnerships.

Corporate Social
Responsibility (CSR)
Overview

Originally, it was closely linked to supporting social organization and

community initiatives
Today, there is a broader connection
o address societies concerns with regard to sustainability of
companies operations and its impact on the environment and
communities wellbeing
Transparency and accountability are increasingly important
Every leading company is required to publish a sustainability report
o J.M. Smucker already satisfies this requirement

CSR - Concern for the use of

Palm Oil

Increased awareness of the detrimental effects on

the rainforest from palm oil plantations
The size of palm oil plantations is estimated to
double in Chiles neighboring country, Brazil
o Could be very detrimental to Jif if the Chilean
people decide to boycott due to Jifs use of palm
oil
Currently palm oil is in all of the natural
spreads including Creamy, Creamy Honey,
Crunchy, and Crunchy Honey
o To mitigate this issue, Jif needs to start testing
the use of alternatives
Yeast is the most viable option

,,,
CSR - Concern for materials
used in packaging

Two types of containers will be used

o Large jars and small cups both made with TEP
plastic
Recycling has been gaining support in recent years
starting with a bill proposed by President Sebastin
Piera
o Companies will be in charge not only of design,
production and commercialization of their
products, they will also have to take responsibility
for the end of life of these products. (The Santiago
Times)
Coca-Cola Chile, Nestle, PepsiCo, Walmart Chile, and
Unilever have signed on to support a new recycling
network in Chile
o will accept about 20 different materials, including
glass, PET plastic, aluminum, paper, cardboard,
and textiles (Mazzoni)
To take advantage of these recycling centers, Jif should

UDGET SUMMARY COUPON EXPENS

ng
ns usi
o
p
u
o
rc
ld offe email, text
u
o
h
s
,
ite
Ji f
enues the Jif webs s
v
a
e
e
d
on
thr
ng, an email coup
i
g
a
s
s
me
000
o 250,
onth
r
per m
$75 pe
s
e
m
0
Assu
r 1,00
e
p
h
t
mon
ges
messa ual cost of
nn
Total a 0
0
$225,0 xt message
000 te month
o 500,
ns per
coupo er message
f
$.05 p
co s t o
l
a
u
n
n
Total a 0
0
$300,0
as
ebsite
o Jif W time cost of ming
On e
0 assu nce
0
5
$
s
a
little a
ainten
m
o
n
o
little t d.
de
00
is nee
,000,0 e first
9
t
s
a
le
h
l of at e released t
a
t
o
t
A
s will b
n
o
p
u
co

 Reports to Purchase
eport
R
y
r
t
s
u
d
tter In
r $925
o
f
ld
r
o
Peanut Bu
W
y IBIS
o Provided b
industry
y
e
k
s
in
a
t
dustry
o Con
in
,
e
iz
s
t
e
k
mar
statistics,
nd profit
a
h
t
w
o
r
g
d
trends, an
outlook
r
a
e
y
5
a
or
forecasts f
period
Report
y
r
t
n
u
o
C
roup for
G
S
R
Chile
P
e
h
yT
o Provided b
rges are
a
h
c
a
r
t
x
e
$325, but
r access
e
s
u
ilt
u
m
r
incurred fo
otential
p
s
e
s
s
e
s
s
o expertly a
l, and
ia
c
n
a
n
fi
l,
politica
business
o
t
s
k
is
r
economic
d trade
n
a
s
t
n
e
m
t
inves
Report
e
il
h
C
in
d
Foo
onitor
Packaged
m
o
r
u
E
y
b
o Provided
al
upplys
Internation
y
e
k
f
o
alysis
o includes an
ds and
n
e
r
t
d
n
a
em
side and d
n of
io
t
a
t
n
e
m
g
detailed se
local

 U.S. CHILE FTA

t on
c
e
ff
e
t took
n
e
m
e
Agre
e
d
a
r
T
Free
ere
2004
,
w
1
s
the
y
ff
i
r
r
h
t
a
i
t
w
f
,
o
Janua
y
el
ity
out
o Major ed immediat
d
e
s
a
h
p
t
elimina g ones being
in
s
remain next 12 year this
e
to
over th e privileged
t the
a
b
h
t
y
l
e
n
v
pro
ld o
ed in
c
u
d
Jif wou nt if it could
o
r
e
d or p
e
m
n
i
e
a
e
t
r
ag
e U. S .
olly ob
h
h
t
w
r
the
s
o
f
i
o
e
l
i
t
s
h
o
C
good
the c
f
ory of
i
t
i
r
m
r
e
e
l
t
the
ther
t prob
o
n
r
e
o
r
r
,
s
u
t
o C
her
t
peanu
o
,
l
i
m
o
o
palm
t of
ced fr
r
n
u
e
o
c
r
s
e
,
p
ts
produc , exceeds 10 e peanut
ies
of th
e
u
l
countr
a
v
sted
u
j
d
a
e
th
ese
h
t
t
r
e
e
t
e
but
ct to
e
not m
j
b
o
u
d
s
s
t
uld be
roduc
o
p
w
s

f
y
i
J
e
If
ts, th
n
e
m
e
requir
ing:
w
d tax
o
e
l
l
d
o
d
f
a
e
e
th
alu
o 19% v
Tax
ment
y
e
t
r
u
i
u
d
q
re
o 6%
d
icense

 Chilean Taxes on Income

utter
b
t
u
n
. pea
$1.2
S
.
y
l
U
e
t
e
a
h
roxim
d on t
p
e
p
s
a
a
f
B
sales
o

n
4
a
1
e
l
0
i
2
Ch
n in
sales in can expect
o
i
l
l
i
m
Jif
y $33
l
e
t
a
billion,
m
proxi
p
a
e
b
to
bout
r.
a
a
e
s
i
y
t
e
l
s
i
of Ch
aning
the fir
e
n
o
m
i
t
,
a
s
l
t at e
opu
The p f the United S old at the
5.5% o anut butter s n sales
pe
ilea
h
C
,
e
that if
t
id sta
p
illion
a
r
m
e
5
6
m
nut
$
a
a
s
t
e
u
p
o
t
b
a
be a
ct th
a
f
e
h
would
for
t
t
r
c
o
f
u
t
d
n
o
cou
e pr
To ac s not a stapl is sales
i
ple, th
butter
o
e
p
n
ilea
half
n
i
t
u
the Ch
ejects
c
r
s
r
a
o
w
s
t
te
ccep
a
t
sales
estima
e
,
k
y
r
l
a
k
c
i
m
re qu
o
o If the
m
t
c
odu
this pr
uate
t ax
t
c
e
t
u
a
fl
r
d
o
woul
e corp
l
th e
b
n
a
i
r
o
%
v
0
a
f
as a
d to 4
h
e
r
e
a
l
i
p
h
m
C
% , co
5
2
f
o
te of
MG)
a
P
rate
K
m
(
i
t
s
s
e
e
Sta t
ales
taxes
y
a
United sed on the s
p
d
l
ou

SOURCES
Aftermarketer Club. (201, January 26). How to Start Engaging in Coupon Marketing. Retrieved from
http://aftermarketerclub.com/blog/2011/01/how-to-start-engaging-in-coupon-marketing/
Balch, O. (2015, February 17). Scientists reveal revolutionary palm oil alternative: yeast. Retrieved from
http://www.theguardian.com/sustainable-business/2015/feb/17/scientists-reveal-revolutionary-palm-oil-alternative-yeast
Euromonitor International. (2015, March). Canned/Preserved Food in Chile. Retrieved April 26, 2015, from
http://www.euromonitor.com/canned-preserved-food-in-chile/report
Food Export Association. (n.d.) Chile Country Profile. Retrieved from https://www.foodexport.org/Resources/CountryProfileDetail.cfm?
ItemNumber=1024
Gistnet. (2014, November 13). Chile: Import (general). Retrieved April 26, 2015, from http://www.gistnet.com/cidb-sample/ar-cl.import.html
Global Marketing Today. (n.d.). Global Marketing Mix: Price | Global Marketing Today. Retrieved April 27, 2015, from
https://globalmarketingtoday.wordpress.com/about/global-marketing-mix-price/
Grocery Retailers in Chile. (n.d.). 52-52. Retrieved from http://www.euromonitor.com/grocery-retailers-in-chile/report
HKTDC. (2015, January 22). Chile: Market Profile. Retrieved from
http://emerging-markets-research.hktdc.com/business-news/article/Latin-America/Chile-Market-Profile/mp/en/1/1X000000/1X003I6C.htm#s
thash.dJtXsmZm.dpuf
Hill, J. (2014, July 22). Stop Peanut Butter Company from Destroying Rainforests. Retrieved from
http://forcechange.com/129675/stop-jif-from-using-palm-oil-in-peanut-butter/
IBIS World. (n.d.). Peanut Butter Production in the US Market Research. Retrieved April 26, 2015, from
http://www.ibisworld.com/industry/peanut-butter-production.html
KPMG. (2014, October 20). Chile - Tax reform is enacted, new corporate tax rules. Retrieved from
http://www.kpmg.com/global/en/issuesandinsights/articlespublications/taxnewsflash/pages/2014-2/chile-tax-reform-is-enacted-new-corporat
e-tax-rules.aspx
Lang, C. (2014, November 10). Oil palm set to take over from cattle ranching as the biggest threat to Brazil's Amazon rainforest?. Retrieved
from
http://www.redd-monitor.org/2014/11/10/oil-palm-set-to-take-over-from-cattle-ranching-as-the-biggest-threat-to-brazils-amazon-rainforest/
Maldifassi, J., & Canessa, E. (n.d.). Information technology in Chile: How perceptions and use are related to age, gender, and social class.
Technology in Society, 273-286.

Mazzoni, M. (n.d.). Coca-Cola, Walmart, Others Support Recycling in Chile. Retrieved April 25, 2015, from
http://www.earth911.com/work/collective-recycling-project-chile/
Montanaro, J. (2013, June 18). 8 Insights about E-Commerce in Chile. Retrieved April 26, 2015, from
http://latinlink.usmediaconsulting.com/2013/06/8-insights-about-e-commerce-in-chile/
Peanut Products. (n.d.). Retrieved April 27, 2015, from http://www.peanut-institute.org/peanut-products/peanut-butter.asp
Pew Research Center. (2014, February 13). Emerging Nations Embrace Internet, Mobile Technology. Retrieved from
http://www.pewglobal.org/2014/02/13/emerging-nations-embrace-internet-mobile-technology/
Pfeiffer, M. (2010, February 1). How CSR is seen in Chile. Retrieved from
http://www.csr360gpn.org/magazine/feature/how-csr-is-seen-in-chile/
Quick MBA. (n.d.) Foreign Market Entry Modes. Retrieved from http://www.quickmba.com/strategy/global/marketentry
Statista. (2015). U.S. supermarkets: peanut butter dollar sales, 2014. Retrieved April 25, 2015, from
http://www.statista.com/statistics/348009/us-supermarkets-peanut-butter-dollar-sales/
Teaching Chile. (n.d.). Cost of Living Guide: Food & Groceries. Retrieved April 25, 2015, from http://teachingchile.com/costguide2.htm
The PRS Group. (2015). Country Reports - The PRS Group. Retrieved April 26, 2015, from
http://epub.prsgroup.com/products/country-reports
The Santiago Times. (2013, August 26). President Piera sends Chiles first recycling law to Congress. Retrieved from
http://santiagotimes.cl/president-pinera-sends-chiles-first-recycling-law-to-congress/
U.S. Commercial Service. (2013). Doing Business in Chile: 2013 Country Commercial Guide for U.S. Companies. Retrieved from
http://photos.state.gov/libraries/chile/103796/fsc_business/country_commercial_guide_2013.pdf