Journal of Agricultural Science and Food Research
Open Access

The Flavoured Cocoa Challenge

Devant Maharaj^{* *}Correspondence: Devant Maharaj, Department of Design and Manufacturing Engineering, University of Trinidad and Tobago, Wallerfield, Trinidad and Tobago, Email:

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Introduction

This thesis examines niche marketing as a marketing strategy for Trinidad and Tobago's flavoured cocoa. Case studies of cocoa producers in Ecuador, Dominican Republic, Honduras, along with Trinidad experts in flavoured cocoa as well as Trinidad and Tobago cocoa farmers’ experiences are examined in detail. Data on the practices of cocoa farmers and markets are reported, the significance of the outcomes to the conceptualization of niche marketing opportunities in the context of Trinidad and Tobago's flavoured cocoa, impact on cocoa policy, and implications for future research are discussed. The rationale for the study flows from the fact the cocoa industry in Trinidad and Tobago has been in a state of continuous decline despite high international demand and prices. The competitiveness or lack thereof remains an unanswered enigma for a number of years. Media reports in the past years (2015-2020) have reflected this dichotomy [1].

Trinidad and Tobago are considered as the focal point of the origin for the 'Trinitario germplasm” and cocoa has a historical significance in the economics and culture since the development of the plantation economy in the 1780’s. The Trinitario cocoa beans are a crossbreed between Criollo and Forastero with its roots in Trinidad. In 1727 natural disaster adversely affected the cocoa crop in Trinidad, which then failed as a result. This impact so negatively affected Trinidad's cocoa economy that it did not overcome until 1756 when the Forastero bean from the Amazon region was introduced. The subsequent crossbreeding resulted in the Trinitario bean. In the early 19^th century cocoa superseded sugar as the chief agricultural export of Trinidad and Tobago so much so that the value of cocoa exports doubled that of sugar by the early 20^th century. Trinidad and Tobago, as a result, was regarded as an exclusive producer (100%) of flavoured cocoa beans a status which it has maintained. Since then, Trinidad and Tobago boast of having the longest cocoa breeding and recurrent selection programme. The market for flavour cocoa is separate, relatively small (only 5% of the total world production) and highly specialized with its supply and demand characteristics. Latin America and the Caribbean countries remain the world's largest producers of flavour cocoa however global production trends show little prospect for a substantial increase in the supply of flavour cocoas from producing countries over the short and medium-term [2].

Materials and Methods

This section presents the methodology used to test and validate the assumption/hypothesis that Niche marketing of cocoa is the strategy of choice for the Trinidad and Tobago flavoured cocoa industry.

Country case studies

In investigating different potential options for the development in the Trinidad and Tobago Cocoa industry, it is worthwhile to examine in detail particular models from countries confronting comparable demands of how to enhance their native industries. Three country cases studies were identified for additional analysis. In this section, the author uses cumulative case studies, which are used to bring information together from several sources collected from different parts of the world, including Honduras, Ecuador, and the Dominican Republic.

Purpose

The purpose of using and collecting these case studies is for greater generalization without having to travel to these areas, being a prudent cost-cutting measure. The case studies looked at countries with unique interest and then there were some with general interest. The case studies are used to make the study familiar and to give all stakeholders (researchers, supervisors and markers) a common understanding of the research undertaken and what happens in other areas in the world as regards to agrotourism. The case studies tend to bring out more detailed information than statistical information, which is not readily available, in addition, these studies are used to deal with creativity and innovation in their own context and area and how each country adapts based on their own competitive advantages. Generalization takes place even though it comes from subjective data for a particular country and context. The case studies applied to the Trinidad context in order to look for similarities, differences, strength and weaknesses. Elements of the case study would be adapted to suit Trinidad’s own cultural and social background and bearing in mind our main target market respective to the flavoured cocoa industry [3].

Case study relation

The case studies cited by the researcher is about developing marketing strategies for the cocoa industry in Trinidad and Tobago. To fully explore this, the researcher has to look at successful cocoa-producing countries and develop themes of best practices and examine what can be applied to the local industry. To accomplish this objective of the case study rigorous scrutiny so that the appropriate conclusions on the marketing strategies used by the respective cocoa industries which will result in valuable information to arrive at a marketing strategy template which can be subsequently adopted. The factors examined on a country by country basis was done in context to arrive at what conditions, policies, linkages, and market conditions resulted in success. These and other areas will be examined to ultimately suggest what best marketing model for the Trinidad and Tobago cocoa industry to adopt.

Theory

The theoretical foundation examines niche marketing and theories to predict specialization as a result of international trade of the cocoa industry in Trinidad and Tobago. The key issues in the realization of niche marketing are constructed on relationships. In niche marketing, long-term, strong relationships are the key. In order to develop them, we have to practice relationship marketing. In this approach, we try to build a relationship for the mutual benefit of both parties. Long-term relationships can dissuade likely competitors by functioning as an obstacle and thereby shape lasting viability as well as customer-retention and supplier associations. An additional issue, which may also add to the realization of niche marketing, is reputation. According to these authors organizations market not only their products, but also themselves and as a result niche strategy also rely upon word-of-mouth communication that results in a solid reputation in the minds of customers is essential to be successful as a niche marketer. Those who associate under development with inadequate exposure to international markets generally imply although this is often left unstated that specialization according to comparative advantage is an essential ingredient of development. This specialization can yield economic rewards as Klinger and Lederman (2004) found that "economic discoveries" took place not only in the "modern" sectors but also in "traditional" sectors such as agriculture [4,5].

Porters diamond

In examining the countries, the review has to take into consideration, Porter’s diamond also known as the theory of national competitive advantage of industries. This conceptual model is diamond-shaped that concentrates on clarifying why particular sectors within a particular country are internationally competitive, while others aren’t. Porter's pivots the argument that any organization able to be competitive in the international marketplace is predicated upon an interlocking set of locationspecific advantages that particular sectors in different countries have such as: Firm strategy, structure and rivalry; factor conditions; demand conditions; and related and supporting industries.

Porter stated what determines trade flows and patterns of specialization. Porter cites the nation's proficient in particular sectors that do not have a comparative factor advantage. Porter's Diamond provides a tool to analyze the niche marketing is instructive. Porter postulates that a country is endowed with resources allowing to compete on a global basis. Within this framework, there are four components (are factors of production, related and supporting industries, demand conditions and organization strategy, structure, and rivalry) with each influencing each other. This analysis provides direction for focussing Trinidad flavoured cocoa towards particular niche markets in the international arena [6].

Modified focus group

Due to The nature of this study in which the research was predominately descriptive and exploratory, it allowed for a greater understanding of the current issues through a deeper theoretical appreciation, but also provided an in-depth insight into the significance of marketing of flavour cocoa. More specifically, niche marketing can be examined through an exploratory lens. As the study progressed, and more issues and data were gathered, more analytical and quantitative was assumed. This gave rise to the opportunity to shift from purely qualitative to a hybrid or mixed method approach. This technique allowed for gathering, examining and ‘mixing’, for example, both quantitative and qualitative data at a point [7].

Results and Discussion

Qualitative research-modified focus group

Four (4) focus groups meetings with six to eight sector experts were conducted gain from the participants their unique experiences and knowledge of Trinidad and Tobago flavoured cocoa and the challenges of the industry. The focus group met in St. Augustine, Trinidad between the hours of 10 am to 12 noon on weekends, and participants were provided with refreshments throughout the session to ensure their comfort. The four sessions were conducted between the periods of June 2018 to August 2018. The objectives and data sources used in the focus group are presented in Table 1. The meetings were open and for free discussions of opinions on the topic. They were informed of the objective and the procedure of the meeting, and the participants agreed to the audio-taping of the sessions in addition to my note-taking. There was some degree of interviewing the participants during which pre-determined questions were utilized. Participants were allowed to freely express himself or herself or cross-examined other opinions proposed [8].

As the participants were all experts in the field, the interventions required were minimal. Participants were from the entire spectrum of the sector including producers, academics, value chain contributors, farmers, exporters, government technocrats etc. The written notes were taken verbatim by the researcher, as this was the process that was most acceptable to the participants, after which they read it for accuracy. In some cases where necessary, data triangulation was employed to validate/verify the certain statistical data or policies [9]. The Telephone and Email were used to conduct follow up interviews to inquire as to further clarify issues raised in the session. NVivo software, MS word, and manual codification were employed to analyze the data gathered from the sessions. NVivo proved essential in developing deep and perceptive for the focus group analysis. NVivo provides an in-depth understanding of capability gaps across current roles and functions. Data analysis identified the emerging requirements for particular aspects of Trinidad and Tobago flavored cocoa.

Table 1: Summary of the approach used in the focus group study.

Interviews

The researcher interviewed five experts in the cocoa industry and reviewed four countries that are cocoa exporting countries. Data was collected via interviews (face-to-face, phone and email) with experts in the cocoa industry. The questions that were on the questionnaire were generated using grounded theory from several authors. As stakeholder expertize is critical to the success of any industry, the views of industry experts were solicited while undertaking the study.

The information summarized below was gleaned through indepth case interviews, country analysis and published and unpublished research over a period over three years. Interviews were done with participants who are experts in the subject matter, practising farmers, as well as various aspects of the value chain.

This section focuses on the analysis of the questionnaire data. It addresses the key research question.

Analysis of country case studies

Notwithstanding basic points of difference between Trinidad and Tobago and the three-country cases examined, Ecuador, Dominican Republic and Honduras's experience in the cocoa industry furnish significant lessons for Trinidad and Tobago. Additionally, all three countries export greater volumes than Trinidad and Tobago and have been able to become progressively competitive in the industry through dedicated policies and niche marketing programs. The most important lessons for Trinidad and Tobago from their experience includes the following:

• All three countries were able to improve because of a harmonized countrywide marketing policy that included the involvement of multiple stakeholders, all sharing in a single overarching defined objective. Focused Coordination on the niche market was key.

• Branding was key to ensure that the respective countries were differentiated from other international cocoa bean suppliers.

• Ecuador used government-backed programs to diversify their beans and make them distinct from other international suppliers. A similar strategy is possible for Trinidad and Tobago to employ to differentiate its cocoa from the competition.

• Various forms of cocoa farmers associations were to be found in all three countries as a part of their respective niche marketing strategy.

• All three countries identified niche marketing as the strategy to surmount production restrictions and achieve higher prices.

The researcher has developed a table along thematic lines to show the different types of opportunities that exist in other flavoured cocoa producing countries similar to Trinidad and Tobago namely Honduras, Ecuador, and Dominican Rep. These themes will assist in the development of interview questions as well as survey questionnaires (Table 2).

Table 2: Countries thematic issues.

The findings of the primary research and proffers an analysis of these results. The analysis will be expounded by comparing and contrasting case study findings as well as participant responses in the context of the research aim: To synthesize a marketing strategy mix suitable for the cocoa industry that will create a sustainable industry [10].

The participant responses and case studies were collated and analyzed to address the following fundamental elements. The data collection consisted of detailed interviews conducted with the cocoa local experts were invited to share their impressions, opinions and ideas. This phase also reviewed extensively published and unpublished sector reports.

Characteristics of interview respondents

This analysis is based on 100 responses of estate owners, estate workers and cocoa experts, which included chocolatiers. Given that, the estimated number of cocoa farmers in Trinidad and Tobago in 2015 was approximately 882, and the estimated number of chocolatiers 87 (Table 3).

Table 3: Map of the themes and attributes collated from the group study.

The qualitative data were subjected to NVivo Starter 11 for Windows, and also manual exploration for analyzing text-based research data and developing code content. The transcripts of the modified focus group study are presented. A total of 6 of 11 the invited Experts participated in the group discussions. The stored transcripts of the open-ended questions and interviews were sorted transforming quantifiable demographic information to qualitative. In the categorization and analysis, the data was classified, into themes and attributes, which was subjected further statistical analysis with SPSS. This visualization of the reports allowed for the easy cross-tabulate mixed methods data and visualize the results to brainstorm, map ideas, and explore connections for further investigation. The transcripts, along with the experts written responses, revealed four issues or themes that arose from the discussion. These included economic, political, marketing, and technological, and they were grouped based on the common attributes (Table 4). The four themes are consistent with social analysis (PEST) and the elements of marketing (4P’s). These attributes were subsequently used to develop the questionnaire, which was the main instrument for the survey in the second phase-the qualitative research survey [11].

Table 4: Trinidad and Tobago’s PESTLE cocoa analysis.

Of the six (6) attributes making up the first theme economics, only 67% the interviewees agreed that this issue was significant. The majority of participants did not feel that the other attributes viz financial, knowledge, economic management, pricing structure or praedial larceny were considered as contributory economic issues in the niche marketing of cocoa (81%). It was was the general opinion form the focus group discussions that it may affect the cocoa industry at large, but were really minor for the specific purpose of establishing a more defined niche marketing approach (Table 5).

Table 5: Analysis of the survey responses for the economic theme and its attributes.

Of the six (6) attributes making up the first theme economics, only 67% the interviewees agreed that cocoa decline issue was significant (Table 6). The majority of participants did not feel that the other attributes viz financial, knowledge, economic management, pricing structure or praedial larceny were considered as contributory economic issues in the niche marketing of cocoa. It was the general opinion from the focus group discussions that it might affect the cocoa industry at large, but were really minor for the specific purpose of establishing a more defined niche marketing approach. The analysis revealed that there is a only 20% agreement on the attributes contributing to the economic theme [12].

Table 6: Analysis of the survey responses for the technological theme and its attributes.

The response on the Technological theme and its attributes indicated that only 2 of the five attributes were considered significant by 40% of the participants (Table 7). The majority of participants did not feel that the other attributes viz; use of flavour cocoa (ffc) or organic or the level of current technology used on the farm were significant enough to affect the concept of niche marketing. It was the general opinion from the focus group discussions that the certification of farms as producers of flavour cocoa was very significant (60%). This is supported by the fact that the geo-based market was the main factor in niche marketing of this product as is already evidenced by the success story of Montserrat and the Santa Cruz famers. Certification is based on not only the cocoa variety, but also the agro-ecological conditions, the level and quality of crop husbandry, and more so the “rich dark brown chocolate” soils of the Montserrat hill.

Table 7: Analysis of the survey responses for the political theme and its attributes.

The Political theme and its attributes indicated that only 2 of the 7 attributes were considered significant by 70% of the participants (Table 8). The majority of participants did not feel that the other attributes viz; the role of the Government as a collaborator, or as a provider of incentives or general support to the current industry will influence the implementation of a niche marketing strategy. Similarly, the issue of land tenure was no barrier or niche marketing in more than 90% of the respondents. Again, the industry is an old well stabled one, the issue of non-ownership of the farms or land tenure was a moot point. The majority of respondents felt very passionate both at the focus group meeting and in the survey that the role of government was at the policy development and implementation. This they felt was greatly needed to impact this new approach to marketing and the future development of the industry. The feeling was that the government could improve the existing infrastructure (71%), and this will facilitate improved crop production and subsequent yield of the flavour cocoa. The dilapidated roads and lack of amenities like water and electricity to remote areas were not appealing to resident farm workers, and this was the reason for labour to be an issue [13].

Table 8: Analysis of the survey responses for the marketing theme and its attributes.

The Marketing theme and its attributes indicated that 4 of the eight attributes were considered significant by 80% of the participants. The majority of participants felt that marketing opportunities (90%) and niche marketing (88%) including internetworking (74%) were the main drivers of the attributes in the new cocoa niche marketing strategy. Similarly, the issue of labour which is not considered as not barrier to niche marketing (84% to 88%) was deemed significant the majority of respondents. This may be due to the high cost of the type of specialized labour, and the easier source of income from the other forms of labour use by CECEP etc.,. It is evident that niche marketing as a specialized aspect of the marketing, while is new to the traditional institutional approach, has a role in the new wave of empowerment and diversification at the farm level for a new entrepreneurial activity, i.e. Production of raw material and selling a branded commodity or at least a novel product. Again the role of government leadership was not convincing compared to niche marketing (88%) and the need to be more profitable (89%) (Table 9).

Table 9: Analysis of the survey responses of key issues.

Conclusion

This question asked of the experts in the local cocoa industry indicated a singular response. Other than the mere purchase of beans from the cocoa farmer and a level of technical support given by the Ministry of Agriculture and the Cocoa Research Centre there is no structured and organized marketing strategy for the cocoa industry in Trinidad and Tobago. All of the respondents interviewed, however, viewed that marketing was very important. The converse is true of the case study countries examined where marketing is critical to the success of their respective cocoa industry. In the Trinidad and Tobago context contrasted to the case study countries, it is self-evident that a gap exists which is not yet capitalized. So while the case study countries are consistent with Michaelson in exploiting a locating a specifically identified target market in the international flavoured chocolate industry Trinidad and Tobago cocoa has not. Respondents during the interviews corroborated this assessment.

The case study countries have all recognized in order to maximize its industry profitability, as asserted by Linneman and Stanton, there is a need to have knowledge of its customers’ unique set of needs as prescribed by Kotler. These countries strategic linkages with chocolatiers that market to this target group in particular as Honduras did with Chocolats Halba, a Swiss chocolate-maker. This understanding of the customer’s needs from the interviews was not fully appreciated by all the respondents. Instead, production aspects and needs of the farmers' production concern occupied their focus as internal customers. In the local industry, there is there appears to be no consensus that there is a discrete group of customers as described by Kara and Kaynak. Ironically these same respondents were all able to successfully recognize the customer value proposition and its importance to the marketing of cocoa as described by Hudadoff.

The case study highlight that the three countries with a similar geographic region and offer a similar premium product is successful as a result of engaging niche marketing strategies to some extent that develops their comparative advantage. Ecuador's Kallari Association produces and sells gourmet organic Fairtrade dark chocolate bars is an example. A close examination of the countries' cocoa stakeholders were unaware that they were using the niche market strategy. It has to be pointed out that all of the countries examined exported their cocoa products profitably after a period of decline. Niche Marketing is complex as stated by Parrish consisting of three main components of strategy, product and market. The structured interview questions regarding niche market strategies asked of the experts in the field unanimously agreed that niche marketing strategy was the marketing solution for the Trinidad and Tobago cocoa industry and the product is ideally suited for such a strategy which is consistent with the findings of Linneman and Stanton. The identification of the choice of utilizing niche marketing as opposed to market segmenting is critical. 'It is necessary to distinguish clearly between segmentation and niche marketing', as described by Shani and Chalasani as niche marketing can be viewed as the final stage of segmentation.

The concept of niche marketing was first explained to the respondents. All of them saw the intrinsic value of engaging with this type of marketing approach given the nature of the product. It was observed in the case studies that product differentiation, pricing policies and relationship building were being practised as niche market strategies. These observations are supported in studies by Parrish et al.,. The stored transcripts developed from the qualitative research-modified focus group provided the responses of the open-ended questions and interviews. This data, when sorted, transformed the qualitative demographic information to quantifiable and provided the themes and attributes. This first step allowed for explorations of the connections and nodes for further investigation (Section 3.1). The analysis of this data revealed that certain attributes were non-contributory (financial, knowledge, economic management, pricing structure or praedial larceny), but marketing as a theme (18 ± 9.07) was very significant and further that niche marketing of cocoa (81%) was the most significant attribute from the study. The Global Forum on Agricultural Research (GFAR) made similar observations regarding the niche market for Honduras cocoa.

The study demonstrated that the quality of the product has a competitive advantage and that branding (grown in Trinidad and Tobago) can be a significant marketing tool. This observation also held true for the case study countries. This, however, this contradicted the conclusions of Parrish et al., which revealed that brands were becoming less important to some consumers. The product, however, is consistent with the "luxury strategy" as articulated by Kapferer and Bastein who defined luxury brands and products as well as analyzed the character of luxury brands. Additionally, Goodhue and Rausser viewed this value differentiation as the method by that insulate, match and exploit heterogeneity in consumer preferences and product attributes. All respondents, as well as the case study countries, recognized that one of the most common and effective niche marketing strategy, was product differentiation.

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