Group2 Case

Republic of the Philippines BULACAN AGRICULTURAL STATE COLLEGE Pinaod, San Ildefonso, Bulacan

INSTITUTE OF MANAGEMENT

A CASE ANALYSIS

ANDEC HI-CALCIUM MILK

In partial fulfillment of the Requirements of the Subject MARKETING MANAGEMENT

GROUP 2 Kelvin Lejar Aga Coleen Alegre Cindy Domingo Michelle Estarez Liezel Fernandez Haezel Leocania

MS. IMEE ESGUERRA Subject Instructor

July 7, 2014

I.

TIME CONTEXT: November 2000, management concluded that continuous investment in Andec would only mean incurring more losses. Andec will remain in their inventory until a more effective marketing strategy could be mapped out.

II.

POINT OF VIEW: Markus Gonzales, one of Andec’s brand managers.

III.

CENTRAL PROBLEM: What marketing plans could Mr. Gonzales suggest to the senior management to bring back Andec to the Philippine market?

IV.

SUB-PROBLEM: 1. In what way can Andec differentiate itself from the other competitors’ brands in the market? 2. What type of buying decision behavior is involved in the purchase of milk products? 3. What promotional strategies that Andec will apply to make an effective awareness to its target market?

V.

OBJECTIVES: 1. To arrest the declining sales of Andec. 2. To recover the losses of P60M. 3. To regain its composure in the milk industry and to maximize profitability. 4. To identify the appropriate market segment and repositioning of the brand. 5. To launch again the Andec into the market.

VI.

AREAS OF CONSIDERATION: Strength: 1. Andec has more calcium and other important vitamins than normal full cream milk powders. 2. A high calcium milk formula with vanilla flavor. 3. Andec has marketed internationally and became a leading full cream milk brand in the other Asian markets, specifically Indonesian who captured 90% in the market. 4. There are 5,500 retail customers strategically located nationwide. 5. Andec has two variants for children 4 to 8 yrs. old and for those 9 yrs. old and above. Formulation also safe for 1 to 3 yrs. old. Weaknesses: 1. Competitors specially Nido has been in the market for so long and has already become a household name. 2. No distinction in the packaging is made for each variant. 3. 15% price premium over its leading competitors, because of its higher calcium content. 4. Poor positioning of Andec in the Philippines. 5. Not suitable for infant Opportunities: 1. Growing market of Milk Industry.

2. Awareness of the importance of calcium was starting to create a demand and a trend of introducing calcium-associated products into the market.

Threats: 1. Major competitors like Nido. 2. Indirect competitors are milk in different forms like filled milk, skimmed milk, fresh milk and etc. 3. Consumer may also purchase substitute that do not belong to the milk category such as calcium fortified juices, calcium supplements and calcium bearing beverages. VII.

ALTERNATIVE COURSES OF ACTION (ACA): 1. Launch new variants of Andec Hi-calcium milk which is suitable for infants. If Andec will enter a new target market which is for infant formula, it will be a great opportunity for them to cover the wide/large market share in the Philippines due to lack of competitors. 2. Modify Andec formulation which is differentiated with other full cream milk and create more effective marketing strategy. 3. Produce smaller pack or swak pack of Andec Hi-calcium milk.

VIII.

RECOMMENDATION: In order to bring back Andec, Mr. Gonzales should suggest ACA 2. Develop the 4p’s Marketing mix; the price should base on what their money can afford because nowadays the parents are wise in terms of buying milks products, they are not only looking for the calcium contents but they also consider its reasonable price. Modify Andec formulation by reducing its calcium content but still higher than the competitor’s brand to retain its image, then add more Energy nutrients to support the energy needs of 4-8 kids and adding more vitamins especially Vitamin D to support the growth development of the body and bones of the 9 years old and above. The packaging label will emphasize the Brand name and the identity of age bracket for better recognition and awareness of what Andec have. Make an efficient promotional strategy to make an effective awareness to its target market. This will result to appropriate market segment and proper position of the brand.