“PRINCIPLES OF MARKETING ”
Date: June 15, 2013
Lecture in charge:
Dedicated To To our parents who loved us in our childhood and always pray for our better future.
Acknowledgment First, we owe gratitude to Almighty Allah, the most merciful and compassionate, most gracious and beneficial whose factor made it possible for us to accomplish this task assigned to us. And we also offer our thanks from the depth of our soul to the last messenger Hazrat Muhammad (P.B.U.H), who is forever a torch of guidance and knowledge for entire humanity. We pay heartiest tribute to our supervisor Sir. for their valuable suggestions, positive criticism, and guidance throughout our project work. Words cannot say the gratitude that we feel for our parents for their moral boost encouragement & financial support. Particularly, we have always been feeling my parent’s right behind us praying, patronizing and enabling our to work out the era of living both spiritually and physically & whose prayers was incessant enabling us to acquire this stage. And we are also thankful to our friends and cousins whose affection and prayers have always been the key to our success. Without all of them support, prayers and Allah’s help, it was almost impossible for us to complete this project.
According to “Philip kotler” Principle of Marketing is the process my we create value for customer and build strong customer relationship in order to capture values from customer , its basic pillars are product, price, promotion and place for achieving effective response. All the planning and operations should be customer oriented. That is the organization and its employees-should be focused on determining and satisfying customer needs. All marketing activities in an organization should be co-coordinated efforts (such as advertising, product planning and pricing). The marketing is very essential for any product and the business expansion. The project given to us was “to introduce a product in Pakistan” “through this study we would get knowledge on the customer preference & practically apply all knowledge we have study in “Principle of Marketing”. At the end of the study we gain a good knowledge about the marketing functions and suggestions are recommended to improve customer satisfaction further.
TABLE OF CONTENT CHAPT ER
Objectives of company
Chapter #2 Market Segmentation &
Chapter #3 Product
Chapter #4 Price
Chapter #5 Place
Chapter #6 Promotion
Chapter #7 SWOT Analysis
Future Plans & Conclusion
Company profile: Name:
Fast ‘n Fresh Ltd….
Product: Ice Cream (packed & fresh).
Proposed Flavors: World famous Vanilla and different mouth watering flavors.
All the partners of Fast ‘n Fresh Ltd... Will have equal profits sharing ratio between them.
Vision Statement: The Vision of Fast n’ Fresh is Serve Our people with the best Possible combination of Nutritious Product with Natural touch.
To provide our customers with life-affirming product, making long lasting relationship with customer and increase our market shares.
Legality of Fast ‘n Fresh….Ltd 1.Inspection and Approval By Ministry Of Food and agriculture:
Our product is made of milk and chemical (artificial
flavors) which does not have any content which may be harmful for the consumer.
Registered trade mark:
We will register our trade mark. Our formula. Recipes.
Objective of project: To introduce a new product in a Pakistan, apply market strategies on it, target it customers, analysis competitor & swot it.
Objective of the DESIRE • • • • • • •
To serve good food in a friendly and fun environment To provide good returns to its shareholders To provide its customers with food of a high standard, quick service and value for money. To have the biggest market share, and provide good service for customers. To understand the loyalty of the customers towards the ice-cream and its products with reference to DESIRE To identify customers expectations towards the ice cream. To understand customers behavior in choosing the ice cream.
Competitor Analysis Consumer’s Perception: The consumers always have a different loyalty status for different brands. Sometimes they buy some brand due to the price or sometimes due to the features. Our targeted customers have a brand loyalty for competitors. We will develop a high Promotion & sales and insure the availability of our product anywhere, any time in targeted areas. Then we will generate confidence in our customer for our product.
Market share: Market share helps us know the current market leader and market followers so that our company can develop an efficient marketing strategy for its products after analyzing the current market player’s position. The
research we have conducted showed that our competitors (Walls & Oomore) have large Market Share)
Market Segmentation & Targeting Ice cream is a kind of food, which is not age bounded or class bounded. But it is a fact that people of different ages and social classes may require different varieties of ice cream at different price levels. So for that purpose DESIRE has adopted a rifle approach and divided market into a number of segments according to different social classes and ages and then tried to provide ice cream solution for all to satisfy the consumer within his buying power.
Developing Strategy for Growth:
As, we are giving a new product to the current market segment so our product fall in category of Product development. The Statistic of our exploratory Research shows that our Primary Target market will Universities of Twin cities(RWP/ISB).
CHARACTERISTICS OF THE MARKET Few of the characteristics upon which the market has been segmented are discussed below:
o DEMOGRAPHIC Demographic variables of DESIRE target market are mostly age and income based. DESIRE has created many flavor of ice creams to attract all age groups. DESIRES attract both females and males in the society. If we consider the income segmentation, DESIRE is targeting upper, middle, and lower middle income levels.
Targeting: The researches we have conducted showed that segmentation on the basis of age consist of two main groups: 1. ADULTS(10-15 y)
Adults will mostly prefer the quality product which not only fulfill their taste and preference requirements but also reflects their personality. The adults are normally ready to pay for a product which fulfills their physical and psychological needs because they are the income generators. 2. TEENAGERS (17-25 y)
Teenagers don’t have any specific taste and preferences. New products and new ideas always attract them. But they have a limited product and they have to maintain their expenditure with in that. 3. KIDS Kids normally do not have a great know-how of the taste rather they are psychologically attracted towards the product. They are not concerned with the taste of ice cream and they just want ice cream. As they are dependent and cannot spend money themselves, so their parents mostly just provide them with an economical ice cream, not any specialized ice cream as it is not demanded.
o PSYCHOGRAPHIC The psychographic segmenting is done on the basis of the taste and health conscious consumer. DESIRE targeted its market by creating an image of high quality and hygienic products. DESIRE was for “anyone, anywhere and at any time”, this very well explains psychographic characteristic of DESIRE consumer. Also relating fun with ice cream helps depicting the life style of its potential user.
Targeting: Due to variety of flavors and specialty of being having less fat than competitors. Our product will be more popular among people o BEHAVIORAL The behavioral segmentation is done on three different variables that tend to define a particular behavior or attitude of a consumer. These are: •
Usage rate – 2-3 days (70%)
Benefits – quality, presentation, taste
Targeting: The regular users of ice cream are 70% so we will target them.
Competitor Vs DESIRE:
The way Desire will differentiate itself in the market is by offering low FAT product (ice-cream) than its competitor
Marketing Mix • • • •
Product Price Place Promotion Chapter#3
:Product: Product: Ice cream
Product type: Our product type is convenience product (FMCG’S).
• Branding: Product name: “DESIRE” Slogan:
· Usage: As usage depend upon brand loyalty, though our competitors have high brand loyalty but our research reveals that youth well try new brand offered in the market. So, 70% people use regularly with in 2-3days. We want to increase the usage of our product by improving its availability to our all targeted segments by offering taste that people demand at affordable price.
PERISHIBILITY ·Required Temp: -18°C.
·Life time (Out of freezer): 25 min. ·Expir
y: 10 months.
In bound Quality of DESIRE is to meet the set standards in order to provide best quality in sense of price, place etc
PACKING The research we have conducted showed that people prefer cups on stick. Packaging: Multiple packaging •
Small packs: • Sticks (33%) • Cups (48%)
·Take family packs: (Bars). • ½ liter packs
• 1 liter packs
: Price: Penetrating pricing: The pricing strategy adopted by Fast ‘n Fresh Ltd is penetrating pricing. •
Because it is a totally new brand, which is entering a market, which is already
facing immense competition. And breaking this competition and attracting new requires quality product at low price. Hence our product will be priced low which will be economical and will encourage new buyers.
Because as our sales will increase the cost for the production will decrease
Profit Margin: Our profit margins will 20% of cost production. If one cotton contain 100 ice-creams having cost of production Rs.800 then its profit margin will Rs.200. and cotton will be sold at Rs.1000
Packed ice-cream: Rs.10-15 Attractive flavors
Rs.20-30 Mouth watering flavors.
Rs.70 Family pack(bar)
Simple vanilla, chocolate etc
Fresh ice-cream: After considering all the factors i.e. cost of production, transportation cost, store charges, etc… cost of per scoop of ice cream will Rs. 30 which would earn the company a profit of 20% of cost.
Break even point: After deep analysis it was found out that the company will meet its break even point of production within 2 year of its expected sales of 20,8334 units per month.
Fixed cost of plant=Rs.1000000 Let, Price of a single product be Rs.10 Marketing project
Variable cost incurred is Rs.8 (20% profit margin) Break- even point =FC/P-VC Break- even point =50, 00000 sales in 2 years
:Place: Primarily Place Target: Universities of Rawalpindi & Islamabad e-g UAAR, IIUI, Comsats, NUML, Nust, AIOU, Baharia etc. The main production of all the products will be done at the Production unit based at “Islamabad Industrial Triangle” and then will be transported to all distributors at different places all over in the twin Cities. This will reduce our cost of transportation
Distribution One of the competitive advantages of DESIRE is its availability, which is ensured by extensive distribution. The distribution of ice cream is different from other products. To keep it in a good form it must be chilled at appropriate temperature. For this purpose deep freezers are used, which are provided by the company. However, the running costs are to be paid by the retailer.
DISTRIBUTION CHANNEL Distribution channel consists of all the people and organizations, which are involved, in the physical distribution of goods. Selection of proper distribution channel is very important aspect because if the channel is managed efficiently, our companies can save high costs and thus generates profits. The cooperation of channel members is also of vital importance. Distribution is making the product available but this availability should ensure that product must be:
At right place
At right time
In right condition
If there is any deficiency in any of these basic elements of distribution, the future of product would be uncertain. Distribution is such an activity, which could decide the fate of the product. When a product offers a strong breakthrough, equity build up rapidly and so does the distribution network. Fast n’ Fresh uses two types of distribution channel for providing its product to the targeted areas.
Direct Distribution Channel The first type of system will be more a short term distribution system which is just for the introduction stage. Its purpose is to actually make the product reach every where Marketing project
and the system is more of creating awareness than actual retailing purpose. This system consists of stalls at introductory prices (very low) by the sales force of the company.
Indirect Distribution Channel •
This is commonly used, in which the DESIRE factory send the products to the local distributors who supply the products to the universities in the required quantity. This system is more convient when there is large numbers of targeted places.
PROMOTION “Our aim is to spark the taste and feeling of summer in everyone’s day. Life is there to be enjoyed and we are the fun part of vitality. We constantly provide new products and experiences that excite the senses and inspire people of all ages to 'taste the fun side of life”---------Promotion Statement.
For any company to capture the market of its own wish and target, promotion plays the most important role in fulfilling the quest for market share. Although the process of promotion is very complex and can be looked in detail: Ice Cream makes you happy – its official!
DESIRE carried out scientific research which shows that some chemicals in ice cream actually make you happy. The study was carried out using FMRI brain scanners, and showed that eating desire had an immediate effect on the part of the brain that is activated when someone is really enjoying themselves – the please areas. So we now have scientific evidence to prove what we all already knew, that ice cream really does make you happy!
Promotional Mix STRATEGY The main distribution strategy, which DESIRE will use effectively is Push Strategy In first strategy include incentives like free deep freezers or discounts on bulk purchases. Promotional strategies of DESIRE ice-cream are consistent. It uses Push strategy for promoting its product because DESIRE spent a lot on advertising and consumer promotion to build up consumer demand.
Producer DESIRE Intermediaries Consumer Demand
Fast ‘n Fresh ice-cream uses Objective-and-Task Method for promotional activities. This method entails, (1) Defining specific promotion objectives, (2) Determining the tasks needed to achieve these objectives,
The company determines its specific tasks to achieve its objectives which are defined by the company’s management. To achieve these objectives company estimates the costs of different tasks, which are to be done to promote its products. 1. Promotional Objectives
Inform Persuade Remind. Our company promotional tool (informative) tell about the availability of product, we can justify prices and can communicate the features of the product. 2. Tasks
Our company’s Tasks consisted of Selection of different promotional tools advertising and media schedules and what types of message are delivered to the target audience. DESIRE uses Advertising and Sales Promotion.
Estimated budget of DESIRE of promotion depends on advertisement and promotions. (1/3rd of the total invested capital).
Promotional Tools DESIRE is creating awareness about its new products for this purpose it is using huge signboards on the major square of the cities and more importantly both the print and electronic media for advertisement and for that it is following AIDA model. DESIRE have used all sorts of mediums of mass communication and one to one bases. The mediums used in DESIRE promotional activities are: News papers Magazines
Radio Banners Pamphlets Stands in canteens of universities. Event arrangements in many universities Bus Stop Board Ads Fun carnival carried out in different parks such as Jinnah Park (future plan).
2. SALES PROMOTION DESIRE has been going a number of sales promotion activities like the:
Stalls: We will arrange different promotional stalls in our targeted universities in (RWP/ISB).in order to create awareness about our product in enjoyable environment.
Cycling System: DESIRE started its cycling system for awareness but after that its task was modified into doing sales promotions for the company. And also cycling system has proved excellent in terms of sales and promotion.
S.W.O.T. Analysis Strengths •
Efficient manufacturing and distribution premises
Product made of pure milk.
Good management and staff.
Resources available for new venture.
Aggressive promotion schemes.
Variety of flavors.
Competitor perception in customer’s mind.
Failure due to No brand equity.
Deals in limited market
Opportunities : These are: •
Product with new market opportunities.
Easy in achieving break even point
Development of further varieties
Introducing new SBU in near future.
Threats : These are: •
The competition from rival ice cream companies (oomore).
Recession leading to poor demand in the economy.
Spreading rumor about company.
Chance of failure due to new launch.
: Future Plans: Social marketing. To slowly start a manufacturing units in big cities like Lahore ,Karachi,etc Sponsor different concerts in universities. Mass communication.(for increasing number of customers).
To capture maximum market share.
CONCLUSION: Effective marketing and campaigning yield the number of customers. Desire Ice Cream will be successful. This business plan has documented that the establishment of Desire Ice Cream is feasible. Desire ice creams being on a starting stage, will have good advertising strategies, sales promotions, and offers to attract more customers and to make them more familiar to our brand. We expect not only to met the perceived attributes of our targeted customers but also exceed it. Gain a good knowledge about the marketing functions and suggestions are recommended to improve customer satisfaction further.
REFERENCES Principle of Marketing by Philp Kotler & Gray Armstrong
Ahmed Raza Anjum 0333-5522722; 0333-5522744 mail:[email protected]
Jahanzeb Khan Niazi 0345-5284462
Mr. Adnan Quershi (sales manager silk bank I-9 ISB)
LINKS: http://sendicecream.stores.yahoo.net/hisoficecrea.html http://www.faqs.org/ /Marketing-Strategies.html http://ezinearticles.com/?Marketing-Strategy-and-a-Lesson-to-Apply-to-AnyBusiness&id=3907869