final marketing project mm 1&2 gr 2 ss
TRANSCRIPT
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Abhishek Kumar JhaAbhishek PalAnand KumarAnulika SinghNimesh ShuklaPamela RoyPrasenjeet Tewari
CHOCO HONEYMarketing plan : MM-1&2
PGDM 2012-14 IMI-K
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AGENDA
1. Market Overview
2. PEST Analysis: Chocolate Industry
3. Company overview: Dabur
4. Product summary
5. Porter’s five forces
6. Competitors analysis
7. SWOT analysis
8. Market research & Product definition
9. Segmentation
10. Targeting
11. Positioning
12. Marketing mix
13. Showcasing : Product
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MARKET OVERVIEW
• The chocolate market in India is pegged at 2,000 crore and is growing at a rate of 18-20 per ₹cent per annum.
• Increasing consumer demand has led to more and more players entering the market.
• The industry is extremely fragmented in terms of range of products.
• The two giants Cadbury with 70 per cent and Nestle around 20-25 per cent have been instrumental in building up the chocolate market in India.
• The chocolate is worth 3,200 crore in India of which Cadbury Kraft Foods has a 70% share, ₹20% is held by Nestle and the others operate in the remaining 10%, which forms around 310-₹320 crore.
• Some of the foreign players are Mars, Guylian, Lindt, Hershey’s and other Swiss chocolates.
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MARKET OVERVIEW
• The size of the market for chocolates in India was estimated at 38,000 tonnes in 2012.
• Bars of moulded chocolates like amul, milk chocolate, dairy milk, truffle, nestle premium, and nestle milky bar comprise the largest segment, accounting for 37% of the total market in terms of volume.
• The chocolate market in India has a production volume of 39,400tonnes.
• The chocolate segment is characterized by high volumes, huge expenses on advertising, low margins, and price sensitivity.
• The chocolate market today is primarily dominated by Cadbury and Nestle, together accounting for 90% of the market.
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ENVIRONMENTAL ANALYSIS
PEST/OT O T
PStable democracyFavorable government policies.
Coalition govt.
E
Fast Emerging economy with a population of over 1.25 billion.Recession Proof product market, Early product life life cycle..FDI – 100%₹25000 crore of Market, growing@ 20%.
SRising Consumer Disposable Income among high and middle income growth Change in consumer preferences from sweet to chocolate.Change in Lifestyle trend and food habits
ObesityOther health disorders
TAvailability of skilled man power.National Dairy Research Institute.
Perishable product-storage & transportation.Heavy dependency on import for cocoa.
LFSS Act, 2005 High compliance
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COMPANY OVERVIEW : DABUR
One of the largest FMCG Company of IndiaConsolidated Turnover of 5283 Crore (about $1 billion) FY 2012₹ .
Differentiated ProductStrong herbal and natural profile
More than 100 years of exp. in Ayurveda
Wide distribution networkCovering over 3.4 million retail outlets all over India
High penetration in urban and rural area
Brand strengthStrong brand in diverse categories
Mother brand DABUR trusted for natural and herbal health care
₹12 billion brand value
Strategic PositioningHoney as food product, leading to market leadership (over 75%) in branded honey market
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Chocolate Industry : India
2012 2030 2050
Rs 2000 Cr
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PRODUCT SUMMARY
Product Name: Choco Honey
Product: Close to new line of business
Product Tagline: Swad Se Sehat Ki ore
Strategic positioning of Honey as food product, leading to market leadership (over 75%) in branded honey market of Dabur.
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CadburyNestle
Foreign Players& Domestic Big Players
Cocoa Suppliers Consumers
Sweet shop, cookies, cakes,
Gifts
Bargaining power of suppliers
Threat of new Entrant
Bargaining power of Buyers
Threat of substitutes
Porter’s five forces
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Competitor Analysis: Cadbury
• Cadbury is a confectionary company owned by Kraft Foods and is the industry's second-largest globally after Mars, Incorporated.
• With its headquarters in Uxbridge, London, England, the company operates in more than 50 countries worldwide.
• Cadbury was incorporated in India on 19 July 1948. • Cadbury Kraft Foods has been a market leader in the chocolate category since the last 64
years in India.• It is the market leader in the Indian chocolate confectionery business with a market share of
over 70%.
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Competitor Analysis: Nestle
• Nestlé’s first sales agents in India began work in Chennai and Kolkata in 1912. • Today, the company directly employs 6,000 people in India and more than half a million
indirectly.
• Its products are sold in more than 3.5 million outlets across the country.
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COMPETITOR ANALYSIS: PRICING
• Price is same all over India.
• Competitive pricing.
• Due to price hike in raw material and labour cost company had not increased the cost of product but reduced the weight of product.
• Eg. 5 pack was of 13gm but now it is 10.5gm₹
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SWOT ANALYSIS (DABUR)
Location of Factor
Type of Factor
FAVOURABLE UNFAVOURABLE
INTERNAL
StrengthBrand NameStrong distribution systemDeep penetration
WeaknessRequires suppliers for cocoa and milkInadequate storage facilities
EXTERNAL
OpportunityOpen to try new brandOnly few honey flavors existIncreasing demand
ThreatImport PoliciesRising raw material costIndustries stretching their operations Duopolistic market
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Market Research : Understanding the consumer
Buyer motives
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Market Research : Understanding the consumer
1. Why do you purchase chocolates ?
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Market Research : Understanding the consumer
2. Which is your most preferred brand for chocolates ?
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Market Research : Understanding the consumer
3. Why do you prefer this brand (chosen by you) ?
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Market Research : Understanding the consumer
Buyer Habits
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Market Research : Understanding the consumer
4. How often do you buy chocolates ?
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Market Research : Understanding the consumer
Psychological process underlying buying decisions
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Market Research : Understanding the consumer
5. What do you focus while buying a chocolate ?
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Market Research : Understanding the consumer
6. Do you perceive chocolate as a health product ?
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Market Research : Understanding the consumer
Participants and roles
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Market Research : Understanding the consumer
7. You buy chocolates for :
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MARKET RESEARCH
1. Which flavour of chocolate would you prefer ?
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Market Research : Understanding the consumer
2. How do you perceive honey ?
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Market Research : Understanding the consumer
4. In which form (shape and size) would you prefer chocolate ?
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Market Research : Understanding the consumer
6. Are you ready to try out a new brand of chocolate ?
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DEFINING PRODUCT
Name : CHOCO HONEY
Attributes :
Sweet in taste
Ingredients: Honey, Tulsi, Chocolate.
Price range : 5-50₹Flavours : Just honey (5-20 category),Rich Almond and Nut(20-50 category).
Value : Taste and health
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SEGMENTATION
• Demographic : Consumers within the age group of 5-40
• Geographic : In and around Kolkata
• Based on our extensive Market research one third of our consumer preferred chocolate in the price range of 20-50, while more than10% preferred for price segment more than ₹
100.₹
• That indicates people from middle class and educated middle class are significant part of our consumer base.
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TARGETING
• Based upon our Online Market Research we shall Target following segment of population:
• For Kolkata region and surrounding urban
sector
• People from SEC A1, A2, B1, B2
For Rural region:-• People from R1 & R2 shall be targeted.• Process for targeting:• Sweet loving consumers• Consumers who consider sweets as gifts
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POSITIONING
• Combines the taste of chocolate with the delicious taste of honey.
• It will compete against products like Dairy Milk by Cadbury and Milky-bar by Nestle.
• Differentiator : The combination of chocolate with honey.
• Focus on health.
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MARKETING MIX
Product• Honey and Tulsi combo based Chocolate. 10.5gm, 22gm, 95gm
Price• ₹ 5-20 (Bar)• ₹ 20-50 (Cartoon shaped)
Place• Schools, college canteens, offices.• Mom & Pop stores.• Dabur’s retail network and dealers.
Promotion•Television commercials•Celebrity endorsement•Posters and billboards•Print media•E-marketing
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Market Research : Understanding the consumer
3. How much are you ready to spend on a chocolate ?
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SHOWCASING : PRODUCT
Chocolate coating
Honey +Tulsi
Category ( 5 - 20)₹ ₹
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SHOWCASING : PRODUCT
Cashew nut
Almond
Category ( 20 - 50)₹ ₹
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WHAT WE DID IN MM-1?
TARGET MARKETSTRATEGIES
COMPETITORS
SWOT ANALYSISMARKET ANALYSIS
So far we have done…… (MM-I)
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• The firms obtain competitive advantage and synergy through integrated programs between the marketing mix variables (product, price, communication, and marketing channels) and the consumer behaviour aspects.
• Marketing Objective is to create and deliver value, this time we are here to deliver Choco Honey to our target customer to capture value in return.
MM-II FOCUS
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Dabur ltd.
Chocó Honey
Chocó
Honey
Chocó Honey
Manufacturing Plant
Warehouse
INBOUND LOGISTICS
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Retail Store
Chocó H
oney
Choc
ó H
oney
Chocó
Honey
Manufacturing Plant
Warehouse
Chocó
Honey
Hyper market
OUTBOUND LOGISTICS
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GOALS
SYNERGYCOMPETITIVE ADVANTAGE
POSITIONINGTARGET
CHOCO-HONEY’S DISTRIBUTION CHANNEL STRATEGY
Marketing Strategy and Distribution Channel Design
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• A conduit between manufacturer and customer.• Not possible to reach out to potential target
customer in a cost effective way.• Choco-honey, being a convenience good, requires
extensive distribution.• To deliver value to the customers through the best
possible channel.• Cost effective – Distribution sales force
DISTRIBUTION OBJECTIVE
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• Multichannel distribution system.• Push strategy.• Nearby location(customers).• Intensive distribution.
STRATEGIC DISTRIBUTION DECISIONS
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PRODUCER
WholesalerSupermarkets
Convenience store
Departmental store
Highway Retailing
Hypermarkets
CHANNEL INTERMEDIARIES
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• Channel Management• Channel Power• Relying on core competency of strong
distribution channel of Our company.
CHANNEL MANAGEMENT
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PRICING STRATEGY
Nature of Chocolate Industry : High volumes Huge expenses on advertising Low margins Price sensitivity
We will prefer Market-penetration pricing
Reaching out to maximum number of consumers and acquiring market share is of prime importance at this stage of our product life-cycle.
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MANUFACTURING COSTS AND OVERHEADS
Budget Allocated for this project : 20 crores₹
1. Cost of raw materials (cocoa beans, milk, sugar, honey, tulsi, cocoa powder, nuts) = 2 crore₹
2. Cost of transportation of raw materials = 20 lakh ₹(@ 1505.20 per tonne freight charge from Kerala to Asansol, ₹carriage charges from manufacturing plant at Asansol to warehouse in Kolkata, transportation of milk from Jharkhand to Asansol, carriage charges to retailers, distributors)
3. Cost of setting up factory, warehouse and equipment = 5 crores₹
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SELLING AND DISTRIBUTION COSTS
Budget Allocated for this project : 20 crores₹
Total marketing budget out of this (@25% of the project budget)
= 5 crores₹
Start-up marketing activities : 60% of allocated marketing budget• Brand Building Cost (@20% of allocated budget) = 1 crore₹• Promotional Activities (@40% of allocated budget) = 2 crores₹
Run-rate marketing activities : 40% of allocated marketing budget• Margins to downstream distribution channel network (@10% of allocated
budget) = 50 lakhs₹• Price adjustment strategies – discount and allowance pricing (@5% of
allocated budget) = 25 lakhs₹• Commissions, Bonuses, Incentives to sales agents (@25% of allocated
budget) = 1.25 crores₹
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BREAK EVEN ANALYSIS AND TARGET PROFIT
5 cr
20 cr
1 cr
1 crore
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VALUE BASED PRICING BASED ON SURVEY
Based upon our Online Market Research we find that consumers are ready to pay in the range of 5 - 50.₹ ₹
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VALUE BASED PRICING ( 5- 20 RANGE) ₹ ₹
Name : CHOCO HONEY
Attributes :
Sweet in taste
Ingredients: Honey, Tulsi, Chocolate.
Price range : 5- 20₹ ₹Flavours : Just honey
Value : Taste and health
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VALUE BASED PRICING ( 21- 50 RANGE) ₹ ₹
Name : CHOCO HONEY
Attributes :
Sweet in taste
Ingredients: Honey, Tulsi, Chocolate.
Price range : 21- 50₹ ₹Flavours : Rich Almond and Nut
Value : Taste and health
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Five promotion mix tools for communicating customer value :
• Advertising
• Personal selling
• Sales promotion
• Public relations
• Direct marketing
PROMOTION
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Outline the communications process and the steps in developing effective marketing communications
• Identify the target audience
• Define the communication objectives
• Find highly credible sources to deliver messages
• Collect feedback.
PROMOTION
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Promoting in small packs or candy style.• Children’s park• Substitute gifts for petty cash • Complementary gift• Separate display designs• Encouraging customers• Doctors’ desk• Blood donation camps
Ways to promote
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• Basing objectives on Target Market, positioning and marketing mix
• Communicating Customer Value• Informative Advertising• Persuasive advertising as competition increases
ADVERTISING
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• Will communicate customer value• Build Choco honey’s image under the brand umbrella
of Dabur.• Explain how the product works• Suggest new uses n attributes • Inform the market of price charges• Correct false impressions if at all
INFORMATIVE ADVERTISING
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• Setting advertising objectives• Setting the ad budget• Developing an advertising strategy-Advertising messagesAdvertising Media
AD-WORDS
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• Press relations or press agency• Product publicity via publicizing• Managing Public affairs actively• Lobbying with legislators and government officials to
influence decisions• Investor relations• Development of PR with donors and NGOs
PUBLIC RELATIONS
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THANK YOU
CHOCO HONEY
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Choco honey
Swad se sehat ki ore
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THANK YOU