RESEARCH BACKGROUND. The research objective is to find out how (from origin Dutch) bitterballen can be marketed in the Indonesian market.

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3 RESEARCHERS 3

4 RESEARCH BACKGROUND At BOI we believe in practice what your preach. That is why we encourage our researchers to do their own research, next to the work we do for our clients. We like our people to show of their skills and work. Anybody at BOI can start their own BOI Labs project, wether they are a trainee or a senior research executive. BOI Labs is a playground where members of our team can play around with new ideas for market research about serious topics, fun topics or where wild and crazy ideas can be tested. In the end of the day, the projects in BOI Labs are also meant to come up with ways to make BOI work more efficient, more accurate and create new solutions for our clients. Research about bitterballen has been chosen because Indonesia is already familiar with bitterballen, but it seems that the product is hard to find and not easily available. Therefore, it is interesting to find out what how bitterballen are perceived at this moment in Indonesia and also how the popularity and availability of bitterballen can be expanded in Indonesia. The research objective is to find out how (from origin Dutch) bitterballen can be marketed in the Indonesian market. It is part of our effort to continuously encourage research, improve the skills of our executives and stimulate research we like.

5 RESEARCH METHOD Multiple research methods have been used. First of all in-depth interviews were performed. The objective was to see what is thought and known about bitterballen. One of the interviewees was already familiar with bitterballen, while the other was not. This allows to look at the subject from different sides. The results eventually served as input for the mini-fgd. IDI : Jakarta, April Length Sample Location : 1.5 hours : 2 respondents : Jakarta Lastly the quantitative survey had the objective to quanitfy the asociations, its potential and marketing input using a convenience sample. Based on these final results analyses and recommendations are made, which should answer the question whether there would be potential for bitterballen how to best make use of that potential. Quantitative online survey : Length : 35 questions Invitations sent : 829 Completes : 129 (16%) Margin of error : 8.63% The objective of the mini-fgd was a two-fold. On the one hand it was finding out the preference for either the Krokky brand or the real Dutch bitterballen. On the other hand mapping thoughts, attitudes and expectations about bitterballen. These results then served as input for the quantitative survey. Focus Group Discussion : Jakarta, April Length : 2 hours Sample : 4 respondents Location : Jakarta 5

6 RESPONDENT PROFILE Gender Age 32% 33% 25 years old or younger 47% 53% Man Woman 26 to 30 years old 31 years old or older 35% Household expenditure Of the respondents who filled in the survey about bitterballen, a little bit more than a half is male. 32% 19% 26% 22% Less than 3 million Between Rp. 3 and 5 million Between Rp. 5 and 7.5 million more than 7.5 million All the respondents are of different ages, almost equally divided within the three set age groups. When looking at household expenditures, almost a third spends over Rp 7.5 million per month. 6

7 RESPONDENT PROFILE In which city do you live? What does your household look like? Jakarta Bandung Surabaya Yogyakarta Tangerang Medan Bekasi Depok Bogor Other 8% 7% 6% 5% 4% 3% 3% 2% 8% 54% Married: Partner main breadwinner Married: Main breadwinner; living with parents Married: Partner main breadwinner: living with parents Single: living with parents Married: Main breadwinner Single 5% 6% 8% 17% 26% 37% Where do you/ your family usually get your groceries? More than half of the respondents live in Jakarta. When looking at the greater Jakarta, Jabodetabek, two third of the respondents live in that area. Hypermarkets (e.g. Giant, Traditional markets (e.g. Pasar 50% 87% Of all the respondents, 63% is single. The rest of the respondents is married. Convenience stores (e.g. Super markets (e.g. Hero, 7/11 1% 48% 44% The respondents mostly do their grocery shopping at hypermarkets (87%), followed by traditional markets (50%). Other, namely: 2% 7

8 PIECES 8

9 SUMMARY Bitterballen are pretty well known. Only 1 in 5 respondents don t know bitterballen. With 2 out of 3 also able to correctly remembering its name. The net promotor score is 16%. A third of the respondents would recommend bitterballen to friends and/or family. Not only are bitterballen well known, of all the respondents two-third has eaten bitterballen before. Those who have eaten bitterballen associate the taste with risoles and ragout. According to respondents who have eaten bitterballen the best assets of bitterballen are the crispy outside, the meat and the filling. Most respondents describe bitterballen as delicious, savory and crunchy. While respondents who have never eaten bitterballen assume the taste will by comparable with kroket or nuggets. Respondents mostly see bitterballen as something that can be eaten by everyone as a snack or sometimes it can be considered an appetizer. The most ideal moment to eat this snack is during hangout/relaxing with friends, at night or accompanied by coffee or tea. The best place to consume bitterballen is either in cafes, coffee shops, and /or restaurants. Especially higher income respondents like to eat them in cafes. When buying frozen bitterballen, the places to get them are hyper- and supermarkets, like Foodhall or Kemchicks. However, most respondents have no idea if they can buy frozen bitterballen at the supermarket. Almost half of the respondents would like to see frozen bitterballen to be available in packages ranging from 12 to 20 pieces in the supermarkets. Almost all respondents would like to see prepared bitterballen in portions of 6 pieces in the places like cafes, coffee shops, and /or restaurants. When it comes to price, respondents prefer 12 frozen bitterballen for around Rp While the price of a prepared portion of 6 should cost around Rp The packaging of frozen bitterballen should have bright colors like red, yellow, or orange. When presented with examples of existing packages, most respondents prefer the Van Dobben packaging or Albert Heijn. The package should look more luxurious, since the product is considered a premium product, especially by the low and higher income groups. 9

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11 RECOMMENDATIONS There seems a lot of potential for bitterballen since only 2% says do not to buy them at all *. There is already substantial product awareness, but this can be improved. Given that the name bitterballen is not known by almost half of the consumers it is important to make sure that the product name will be clearly communicated. Build on the existing awareness of the product and willingness to promote bitterballen among existing consumers to improve name recognition. As far as taste is concerned, bitterballen will be easily accepted by Indonesian consumers. Position bitterballen as a delicious crunchy premium snack that is ideal for eating with family and friends of all ages. Emphasise the crispy outside, the meat and delicious filling. It is also adviced to do extra product testing to see whether the real Dutch bitterballen should be made bigger or not. Also test if extra cheese, or other taste variations are needed for consumers. Try to capture the market for prepared bitterballen first with portions of 6 bitterballen. Increase availability at selected cafes and coffee shops. Improve availability and awareness of availability. The price rage of 6 bitterballen should be between Rp to Rp Given the premium nature of the product, it is advised to put the price closer to Rp After product awareness and consumption of bitterballen has increased, work on availability of frozen bitterballen in hyper- and supermarkets like Hero and The FoodHall with packages of 12 to 20 bitterballen. Ideal colours for packaging bright colours like red, yellow and orange. The price rage of 12 frozen bitterballen should be between Rp to Rp Just like with the prepared bitterballen it is advised to price the premium bitterballen closer to the upper limit of the range: Rp * For this research a convenience sample is used, making the results indicative. Depending at which location bitterballen will be (re)introduced, it is advised to conduct a representative quantitative survey of that area of n = 385 or more. 11

12 PROMOTION/ COMMUNICATION RECOMMENDATIONS In order to have a more premium look for the package the Van Dobben package is a good example. Typical colors or icons that refer to the Netherlands will make the package attract the attention and recognizable. Furthermore it needs to be clear for people that it is prepared and eaten as a snack. Since 33% has not eaten bitterballen before, describe the preparation with the help of easy to grasp graphics. It is advisable to use a similar font. It conveys grace (more premium). The product brand name will also play a big role in this. A starting point might be the name Oma. Indonesian consumers can associate the word with something authentic Dutch and traditional. Lastly, hire professionals when designing the package and coming up with a name. It is a vital part of the future success. It does not have to require a lot of investment. Next to that, it is important that there is a picture of bitterballen on the package. There cannot be any doubt that it is maybe bakso, ragout, nuggets, kroket or risoles. This means, no matter what, that also the product name needs to be present on the package. 12

13 AWARENESS

14 PRODUCT FAMILIARITY What is the name of this product? Did the respondent give the correct name? base = name of the product, n = % 21% I do not know Name 34% 66% Yes No Have you ever eaten this product? Almost anybody recognizes bitterballen, and those who do, a fast majority can name the product correctly. 33% 67% Yes No 67% of respondents has eaten bitterballen before. When the respondents were asked about the name of bitterballen, 79% of all respondents answered with a name, 66% gave the right answer. That means there are still some respondents who have eaten bitterballen but didn t give the correct name of the product.

15 PROMOTORS

16 PROMOTORS Quite a few respondents who have eaten bitterballen promote the product (33%). Almost half of the respondents who has eaten bitterballen is passive in promoting the product, while only 17% would not promote bitterballen at all. How likely are you to recommend bitterballen to a friend or colleague? base = have eaten bitterballen, n = 87 The result is a net promoter score of 16%. 17% 49% 33% 16% Detractors Passives Promoters 16

17 TASTE

18 PRODUCT ASSOCIATION AND TASTE The associations with bitterballen are overwhelmingly positive. Respondents describe bitterballen as delicious/tasty (48%), savory (40%) and crunchy (26%). What three words come to mind when you see bitterballen? Delicious/tasty 48% Respondents who have never eaten bitterballen say that bitterballen reminds them of other food, like perkedel, bakso, and/ or kroket (26%), while respondents who have eaten bitterballen before hardly mention the similarities with perkedel, bakso, and/ or kroket. 7% who has eaten bitterballen answers these three other products. Savory Crunchy Snacks Meat Reminds of other food: The Netherlands Round 19% 17% 13% 13% 12% 26% 40% Soft/tender 11% Cheese 9% Fried 9% Potato 8% Salty 8% Addictive 5% Mayonnaise 5% Interesting/tempting 3% Filling 3% Others 32% 18

19 PRODUCT ASSOCIATION AND TASTE Kroket Nuggets Risoles Bakso Cheesy Poffertjes Potato Other namely How do you think bitterballen will taste? base = not eaten bitterballen, n = 42 2% 2% 10% 12% 36% 38% 38% of the respondents who have never eaten bitterballen think that bitterballen will taste like kroket, another 36% thinks that bitterballen will taste like nuggets. Respondents who have eaten bitterballen associate the taste with risoles and ragout. As is shown in the chart 60% of them says that bitterballen has a similar taste with risoles and 56% says bitterballen has a similar taste with ragout. More than three quarters of the women (76%), say bitterballen have similarities with ragout. While a lot of men (71%) say bitterballen tastes similar with risoles. Which of these products has a similar taste to bitterballen? base = have eaten bitterballen, n = 87 Risoles Ragout Potato People who live outside Jabodetabek think more often that Poffertjes bitterballen have a similar taste with bakso. People who live in Jabodetabek associate taste of bitterballen with ragout Other, namely: more than the average (63%). I do not know a similar product. 2% Bakso 8% 17% 21% 60% 56%

20 PRODUCT ASSOCIATION AND TASTE Most respondents see bitterballen as a premium product. 66% of the total number of respondents sees bitterballen more as premium product. Bitterballen are to 30 years old respondents is the group with the highest percentage, 40%, that see bitterballen as a more low cost product. Total 3% 30% 54% 12% Whereas the youngest age group (25 years or younger) perceive bitterballen the least as a low cost product (23%). Low cost products 2 3 Premium products Bitterballen are... more than 7.5 million Between Rp. 5 and 7.5 million Between Rp. 3 and 5 million 4% 29% 32% 48% 59% 44% 48% 12% 20% 3% Respondents with a monthly expenditure of less than Rp 3 millions mostly see bitterballen as premium product. Respondents with Rp 3 to 5 millions monthly expenditures don t see bitterballen as either a premium or low cost product. Less than 3 million 9% 15% 62% 15% Low cost products 2 3 Premium products 20

21 PRODUCT ASSOCIATION AND TASTE Respondents especially like the crispy outside of bitterballen (68% really like it). But also the meat (57%) and the filling (47%) are aspects that make bitterballen a product these respondents like. The overal taste What do you like about bitterballen? base = eaten bitterballen, n = 87 56% 41% The color The size 61% 57% 26% 33% The crispy outside The meat The filling 29% 38% 49% 68% 57% 47% I like it I really like it 21

22 PLACE AND TIME

23 MOMENT A snack/ finger food (Part of) lunch (Part of) breakfast (Part of) dinner Others, namely How would you eat bitterballen? As... An appetizer 3% 9% 8% 7% 33% Most respondents (94%) associate bitterballen as a snack / finger food. 14% of the respondents who have never eaten bitterballen associate this product with (a part of) dinner, which is significantly higher than the respondent who have eaten bitterballen (3%). 94% Adults middle aged By whom would bitterballen most likely be eaten? It is for everyone Young adults Teenagers Young children Seniors Students 9% 11% 20% 19% 24% 23% When asked about who bitterballen would be suitable for, the majority thinks it is for everyone. There is no age limitation. This applies to all segments within this research. 63% When looking at differences for the expenditure groups it can be seen that the second most suitable group is young children according to the group with the highest expenditure (32%). Interestingly, respondents of the FGD consider students and youngsters as a suitable group to eat bitterballen. These two groups are often interested in trying new things, which is why they would most likely also give the bitterballen a chance. 23

24 PLACE On what occasions should bitterballen be eaten? 46% of all respondents think they should eat bitterballen when gathering/relaxing with friends. When gathering/relaxing with At night/evening While having tea/coffee Snacks While whatching TV/movies When it's raining or cold 3% 13% 22% 27% 26% 46% The older respondents like to eat bitterballen more at night/evening than the other age groups. Meanwhile, 28% of the respondents with a monthly expenditure Rp 3 to 5 million think that bitterballen should be eaten while watching TV/movies, which is significantly more than the respondents with a monthly expenditure of more than Rp 7 million. In all ocassions Others 3% 13% Respondents from the FGD also consider the movie theater as a good occasion to eat bitterballen, as an alternative to popcorn.

25 PRODUCT Almost all respondents prefer to buy bitterballen as prepared products (95%). Only 4% would only buy the bitterballen if they are available frozen. 2% of the respondents would not buy bitterballen at all. How would you prefer to buy bitterballen? Prepared 48% Those who have eaten the product prefer to buy it prepared, those who have not, would try them either way. At the same time, ten times more than those have eaten bitterballen, buying them frozen is the preferred way (10%). Both Frozen 4% 47% I would not buy them 2% 25

26 PLACE PREPARED Where would you like prepared bitterballen to be available? Where would you like prepared bitterballen to be available? more than 7.5 million Between Rp. 5 and 7.5 million 56% 44% 44% 29% 34% 37% 48% 56% 28% 32% 28% 36% 73% 72% Cafe Coffee shops Restaurant Foodcourt in a mall Food stall Cinema Food truck Bar University canteen Street vendor Public swimming pool High school canteen Warung Other, namely: 1% 4%7% 2% 7% 65% 47% 58% 32% 36% 37% 31% 12% 25% 66% 62% 52% Between Rp. 3 and 5 million 31% 24% 41% 28% 50% 65% 41% Less than 3 million 41% 24% 24% 56% Cafe Coffee shops Restaurant Foodcourt in a mall Food stall Cinema Food truck When it comes to prepared bitterballen, the respondents think that a cafe and coffeeshop are the best place where prepared bitterballen should be available. This applies to all expenditure levels of Rp 3 millions and up. Respondents with less than Rp 3 million monthly expenditure more often prefer bitterballen to be available at a food stall (56%). Of the oldest age group of respondents, 59% likes prepared bitterballen to be available at a restaurant. While 32% of male respondents would like bitterballen to be available at a bar, compared to 16% of the women. 26

27 Dutch restaurant PLACE TO BUY FROZEN OR PREPARED Do you know where you can buy this product, either frozen or prepared? Supermarket Restaurant Caffe/coffe shop Hypermarket Pastry shop Others... I don't know 4% 4% 12% 12% 10% 17% 17% Where would you like frozen bitterballen to be available? 53% Most respondents don t know where they can buy bitterballen, especially respondents who have never eaten bitterballen. (Dutch) restaurants and supermarkets are places that respondents mentioned where they can buy bitterballen either frozen or prepared. A lot of respondents, 71%, say that hypermarkets is the place where frozen bitterballen should be available. Followed by supermarkets, 53% of respondent would like frozen bitterballen to be available there. However, only 38% of the respondents with Rp 3 to 5 million monthly expenditure expect frozen bitterballen at supermarket. Hypermarkets (e.g. Giant, Carrefour, Hypermart) Super markets (e.g. Hero, Foodhall, Ranch Market, Kem Chicks) Convenience stores (e.g. Indomaret, Alfa Midi) 7/11 11% 39% 53% 71% On the other hand, more than half of the respondents who have eaten bitterballen think that frozen bitterballen should be available at a supermarket. Respondents who live in Jabodetabek (15%) like frozen bitterballen to be available than 7/11 more often than respondents who live outside Jabodetabek (2%). Other, namely: 3% 27

28 QUANTITY If you buy prepared bitterballen in your chosen venues above, how many bitterballen would you like to have prepared? If you buy frozen bitterballen in a supermarket, how many bitterballen would you like to have frozen in a package? 20 2% More than 50 2% 15 4% 36 6% 10 21% 20 38% 6 53% 12 47% 4 19% 6 7% When looking at quantity, there is a difference between frozen and prepared bitterballen. Most respondents prefer prepared bitterballen to be sold in portions of 6 pieces. However, the group with a monthly expenditure between Rp 3 and 5 million prefers more often than on average a portion of 10 bitterballen (38%). While frozen bitterballen are mostly preferred to be sold in a quantity if 12 (to 20) pieces. The respondents of the FGD partly agree with this. Some respondents prefer the opinion of 20 bitterballen, because this makes it easier to share with family and friends. 28

29 PACKAGING 29

30 PACKAGING Besides knowing what price bitterballen should be, who should buy it and what exactly should be bought, it is important to know how to present it. What would be a good color for the packaging of frozen bitterballen? First consumers were asked what color they would prefer for the package. The results show red is the favourite color. Red Yellow Orange Gold 14% 18% 22% 29% The reason why red is the favourite seems to be because it increases appetite, attracts attention, fits with the color of bitterballen and is a typical color of the country of the origin of the product (Netherlands). The last statement especially applies to orange. Gold is also associated with bitterballen, because it looks luxurious. Brown White Blue Transparent Maroon Green 5% 3% 2% 2% 8% 14% Respondents of the FGD consider bitterballen as a luxurious product, but do not see gold as the preferred color. Others 5%

31 PACKAGING Secondly, 5 different types of packaging were asked to be ranked. De package of Van Dobben comes out on top, only those who have not eaten bitterballen before like it less. They opt for the package that overall was ranked last. For the Van Dobben package the colors red and white are used. This coincides with the colors people say they like. Note that although orange was also one of the favourites, people apparently do not like it when it is dominant as in the Mora package. Brown on the other hand does seem to be liked more while it ranked lower when looking at the choice for colors. What package is most attractive to you? Van Dobben 24% 28% 19% 19% 10% AH3 20% 22% 29% 16% 12% Holtkamp 16% 22% 22% 12% 28% Mora 25% 12% 12% 22% 29% AH4 15% 16% 18% 31% 21%

32 PRICE 32

33 PRICE What are people willing to pay who go to hypermarkets and supermarkets. When looking at the results, there is a difference of 10%. The price range is Rp to Rp , with an optimal price point for all respondents is Rp However, since bitterballen are mostly seen as a premium product the ideal price is Rp Bitterballen: 12 in a package Westendorp method (availability at hyper- and supermarkets) Rp24,000 Rp32,000 Rp36,000 Too cheap Bargain Expensive Too expensive 0 33

34 PRICE The optimal price point for for 6 prepared bitterballen is Rp Just like with the frozen bitterballen, it is advised to position the product as a premium one. Which makes it advisable to set the price at Rp % Bitterballen: 6 prepared Westendorp method (availabiltiy at coffee shops and cafes) 75% 50% Too cheap Bargain Expensive Too expensive 25% Rp19,000 Rp Rp22,000 0% 34