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Businesss marketing plan
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Executive summary
Kevian Kenya Limited is one of the prominent and leading beverage anufacturing
companies in Kenya. The official inauguration of the company was in the beginning of
2004. From the beginning Kevian Kenya Limited launched its major product for the
market, AFIA drink which is a leading drink in the Kenyan Urban Areas. Kevian Kenya
Limited has successfully come up with a variety of its products like carbonated fruit
drinks, bottled drinking water, a variety of fruit drinks as well as tropical mixes. The main
marketing policy of the company is they use to undertake huge advertisement and
promotional activities to create brand awareness and product positioning among the
mindset of the target customers. Not only that, Kevian Kenya Limited started to change
the concept of advertisement of fruit drinks too by using new creative and concepts. And
they were successful in terms of market share and positioning in the competitive soft
drinks market of Bangladesh.
By using the reputation and market demand, Kevian Kenya Limited lunched a new
category of fruit drinks that is natural pure fruit juice under the Brand name of “Pick ‘N
Peel” in January 2011. They targeted the hot start-of-year months to launch the new
product into the market. In that time they also undertook a huge advertisement and
promotional campaign following their previous concept Afia and Mount Kenya Drinking
Water. They used different Medias to draw the attention of the consumers like:
Press Advertisement (News paper & Magazines).
Television Commercial (National & Cable TVs). Radio Advertisement
(BD Radio & Private radio stations).
Outdoor Advertisement (Billboards, Pestering, Neon sign etc).
Mobile Campaign (Road shows).
Moving Advertisements (Advertisements on vehicles).
Public Relations (Sponsoring & arranging Spot game shows).
Sales Promotion (Sampling, Gift and scratch card offer) etc.
Basically they used all the elements of marketing communication tools to create
awareness and position their Brand. And they were successful enough to draw the
positive attention of the customers. At present they are offering three flavor of Pick ‘N
Peel like Mango, Orange and Pineapple. In all of the cases they offer in two sizes of pack
that are 250ml (at Kshs. 45) and 1000ml (at Kshs. 160) paper packages.
In our report we worked to identify the “Impact of promotional activities to create
product appeal among the target customers”. So to accomplish our objectives we have
undertaken a field survey on the customers and as well as the retailer of Frutika to know
the impact of Advertisement and promotional activities to create fascination towards the
product stimulates the secondary sales. That is why we made two different questionnaires
for the Customers and the Retailers to collect information from the respondents. At the
same time we also undertaken as exploratory research on the other existing juice brands
available in the country to make a comparison and contrast between Frutika and them.
After collecting all the related information and data analysis, we found that the
advertisement and promotional activities were very much successful to create brand
awareness and product appeal among the target customers. But it is found that comparing
with the other existing brand, price of Frutika is premium about 25-30% more. So the
customers are not satisfied about this issue. More over there is another vital point to be
noted that Frutika if offering only three flavor (mango, orange and grape) and providing
only in two pack sizes (250ml and 1000ml plastic bottle rater any other sizes and foil
pack). That is why customers are not feeling convenient while purchasing Frutika fruit
juices.
Situation Analysis
Market Analysis:
The market analysis investigates both the internal and external business
environment. It is vital that Akij Beverage Limited carefully monitor both the internal and
external aspects regarding it’s business as both the internal and external environment and
their respective influences will be decisive traits in relation to Coke’s success and
survival in the fruit drink industry.
Internal Business Environment
The internal business environment and its influence is that which is to some extent
within the business’s control. The main attributes in the internal environment include
efficiency in the production process, through management skills and effective
communication channels. To effectively control and monitor the internal business
environment, Akij Beverage Limited must conduct continual appraisals of the business’s
operations and readily act upon any factors, which cause inefficiencies in any phase of the
production and consumer process.
External Business Environment
The External business environment and its influences are usually powerful forces
that can affect a whole industry and, in fact, a whole economy. Changes in the external
environment will create opportunities or threats in the market place Akij Beverage
Limited must be aware off. Fluctuations in the economy, changing customer attitudes and
values, and demographic patterns heavily influence the success of Akij Beverage Limited
products on the market and the reception they receive from the consumers.
SWOT Analysis:
SWOT stands for Strengths Weakness Opportunities Threats. SWOT analysis is a
technique much used in much general management as well as marketing scenarios.
SWOT consists of examining the current activities of the organization- its Strengths and
Weakness- and then using this and external research data to set out the Opportunities and
Threats that exist.
Strengths:
Akij Beverage Limited has been a complex part of world culture for a very long time. The
product's image is loaded with over-romanticizing, and this is an image many people have
taken deeply to heart. The Akij Beverage Limited image is displayed on T-shirts, hats,
and collectible memorabilia. This extremely recognizable branding is one of Akij
Beverage Limited greatest strengths. "Enjoyed more than 685 thousand times a day
around Bangladesh Akij Beverage Limited stands as a simple, yet powerful symbol of
quality and enjoyment". Additionally, Akij Beverage Limited bottling system is one of
their greatest strengths. It allows them to conduct business on a global scale while at the
same time maintain a local approach. The bottling companies are locally owned and
operated by independent business people who are authorized to sell products of the Akij
Beverage Limited Company. Because Coke does not have outright ownership of its
bottling network, its main source of revenue is the sale of concentrate to its bottlers.
Weaknesses:
Weaknesses for any business need to be both minimized and monitored in order to
effectively achieve productivity and efficiency in their business’s activities, Akij
Beverage Limited is no exception. Although domestic business as well as many
international markets are thriving, Akij Beverage Limited has recently reported some
"declines in unit case volumes in Indonesia and Thailand due to reduced consumer
purchasing power." According to an article in Fortune magazine, "In Japan, unit case
sales fell 3% in the second quarter [of 2010]...scary because while Japan generates around
5% of worldwide volume, it contributes three times as much to profits. Latin America,
Southeast Asia, and Japan account for about 35% of Coke's volume and none of these
markets are performing to expectation.
Coca-Cola on the other side has effects on the teeth which is an issue for health care. It
also has got sugar by which continuous drinking of Coca-Cola may cause health
problems. Being addicted to Coca-Cola also is a health problem, because drinking of
Coca-Cola daily has an effect on your body after few years.
Opportunities:
Brand recognition is the significant factor affecting Coke's competitive position. Coca-
Cola's brand name is known well throughout 94% of the world today. The primary
concern over the past few years has been to get this name brand to be even better known.
Packaging changes have also affected sales and industry positioning, but in general, the
public has tended not to be affected by new products. Coca-Cola's bottling system also
allows the company to take advantage of infinite growth opportunities around the world.
This strategy gives Coke the opportunity to service a large geographic, diverse area.
Threats:
Currently, the threat of new viable competitors in the carbonated fruit drink industry is
not very substantial. The threat of substitutes, however, is a very real threat. The fruit
drink industry is very strong, but consumers are not necessarily married to it. Possible
substitutes that continuously put pressure on both Pepsi and Coke include tea, coffee,
juices, milk, and hot chocolate. Even though Coca-Cola and Pepsi control nearly 40% of
the entire beverage market, the changing health-consciousness of the market could have a
serious affect. Of course, both Coke and Pepsi have already diversified into these
markets, allowing them to have further significant market shares and offset any losses
incurred due to fluctuations in the market. Consumer buying power also represents a key
threat in the industry. The rivalry between Pepsi and Coke has produce a very slow
moving industry in which management must continuously respond to the changing
attitudes and demands of their consumers or face losing market share to the competition.
Furthermore, consumers can easily switch to other beverages with little cost or
consequence.
Product Life cycle:
When referring to each and every product or service ever placed before the consumer i.e.
in the long term all the existing products and services are dead. For e.g.:- Replacement of
Ford Cortina ( a highly successful car) by Ford Sierra, the replacement of sierra by the
Ford Mondeo and the replacement of the old Mondeo by the new Mondeo in 2001. So
every product is born, grows, matures and dies. So in the commercial market place
products and services are created, launched and withdrawn in a process known as Product
Life Cycle.
To be able to market its product properly, a business must be aware of the product life
cycle of its product. The standard product life cycle tends to have five phases:
Development, Introduction, Growth, Maturity and Decline. Coca-Cola is currently in the
maturity stage, which is evidenced primarily by the fact that they have a large, loyal
group of stable customers.
Furthermore, cost management, product differentiation and marketing have become more
important as growth slows and market share becomes the key determinant of profitability.
In foreign markets the product life cycle is in more of a growth trend Coke's advantage in
this area is mainly due to its establishment strong branding and it is now able to use this
area of stable profitability to subsidize the domestic Cola Wars.
Marketing Objectives
The objective is the starting point of the marketing plan. Objectives should seek to answer
the question 'where do we want to go?’ The purposes of objectives include:
-> To enable a company to control its marketing plan.
-> To help to motivate individuals and teams to reach a common goal.
-> To provide an agreed, consistent focus for all functions of an organization.
All objectives should be SMART i.e. Specific, Measurable, Achievable, Realistic, and
Timed.
Specific - Be precise about what you are going to achieve
Measurable - Quantify you objectives
Achievable - Are you attempting too much?
Realistic - Do you have the resource to make the objective happen (men, money,
machines, materials, and minutes)?
Timed - State when you will achieve the objective (within a month? By February 2012)
1. Market Share Objectives:
To gain 60% of the market for fruit drinks industry by September 2012.
2. Profitability Objectives:
To achieve a 20% return on capital employed by August 2012
3. Promotional Objectives
To increase awareness of the product on the market.
4. Objectives for Survival
To survive the current market war between competitors.
5. Objectives for Growth
To increase the size of the worldwide Coca Cola enterprise by 10%.
Selecting Target Market
Once the situation analysis is complete, and the marketing objectives determined,
attention turns to the target market. The fruit drink market is very large, and the business
cannot be “all things to all people”, so it must choose which market segments have the
greatest potential. The target market is the group of customers on whom the business
focuses attention. The target market is where Coca Cola focuses its marketing efforts as
it feels this is where it will be most productive and successful. The target market for Coca
cola is very wide as it satisfy’s the needs for many different consumers, ranging from the
healthy diet consciousness through Diet Coke to the average human through its best
selling drink regular Coke. Most Coke products satisfy all age groups as it is proven that
most people of different age groups consume the Coca Cola product. This market is
relatively large and is open to both genders, thereby allowing greater product
diversification.
There are four broad ways which Coca Cola can segment its market:
-> Mass marketing
-> Concentrated marketing
-> Differentiated marketing
-> Niche marketing
The most apparent method used by Coca Cola is with no doubt the differentiated
marketing method as Coke satisfies’s a range of different markets. Diet coke satisfy’s the
weight consciousness, regular coke, sprite, fanta the average human, coffee, iced tea etc.
Each group of beverages satisfies a particular group of people but majority the average
human.
Developing the Marketing Mix
The marketing mix is probably the most crucial stage of the marketing planning process.
This is where the marketing tactics for each product are determined. The marketing mix
refers to the combination of the four factors (price, promotion, product, and place) that
make up the core of a business’s marketing strategy. In this step of the marketing
planning process, marketing mix must be designed to satisfy the wants of target markets
and achieve the marketing objectives. The most successful businesses have continually
monitored and changed their marketing mix due to respective internal and external factors
and have monitored the external business environment in order to maximize their
marketing mix components.
Product:
Many Products are physical objects that you can own and take home. But the
word product means much more than just physical goods. In marketing, product also
refers to services, such as holidays or a movie, where you enjoy the benefits without
owning the result of the service.
Businesses must think about products on three different levels, which are the core
product, the actual product and the augmented product. The core product is what the
consumer is actually buying and the benefits it gives. Coca Cola customers are buying a
wide range of fruit drinks. The actual product is the parts and features, which deliver the
core product. Consumers will buy the coke product because of the high standards and
high quality of the Coca Cola products. The augmented product is the extra consumer
benefits and services provided to customers. Since fruit drinks are a consumable good, the
augmented level is very limited. But Coca Cola do offer a help line and complaint phone
service for customers who are not satisfied with the product or wish to give feedback on
the products.
Positioning
Once a business has decided which segments of the market it will compete in,
developed a clear picture of its target market and defined its product, the positioning
strategy can be developed. Positioning is the process of creating, the image the product
holds in the mind of consumers, relative to competing products. Coca Cola and Franklins
both make fruit drinks, although Franklins may try to compete they will still be seen as
down market from Coca Cola. Positioning helps customers understand what is unique
about the products when compared with the competition. Coca Cola plan to further create
positions that will give their products the greatest advantage in their target markets. Coca
Cola has been positioned based on the process of positioning by direct comparison and
have positioned their products to benefit their target market. Most people create an image
of a product by comparing it to another product, thus evident through the famous battles
between Coca-Cola and Pepsi products.
Branding
It is often hard to say exactly why we buy one company’s product over another.
Companies such as Nike and Adidas spend large amounts of money trying to win
consumers away from their competitors who make products that are very similar. The
popularity of the brand is often the deciding factor. Over the time Coca Cola has spent
millions of dollars developing and promoting their brand name, resulting in world wide
recognition. 'Coca-Cola' is the most recognized trademark, recognized by 94% of the
world's population and is the most widely recognized word after "OK". Coca Cola’s red
and white colours and special writing are all examples of world-wide trademarks.
There are a number of branding strategies: Generic brand strategy, Individual
brand strategy, Family brand strategy, Manufacturer’s brand strategy, Private brand
strategy and Hybrid brand strategy. Coca Cola utilizes the Individual brand strategy as
Coca Cola’s major products are given their own brand names e.g Fanta, Sprite, Coca Cola
etc although they maybe presented as different lines they operate under the name of Coca
Cola.
Packaging
Packaging, which is not as highly perceived by businesses, is still an important
factor to examine in the marketing mix. Packaging protects the product during
transportation, while it sits in the shelf and during use by consumers; it promotes the
product and distinguishes it from the competition. Packaging can allow the business to
design promotional schemes, which can generate extra revenue and advertisements. Coca-
Cola has benefited from packaging the product with incentives and endorsements on the
labeling as a promotional strategy to increase its volume of sales and revenue.
Price:
Price is a very important part of the marketing mix as it can effect both the supply
and demand for Coca Cola. The price of Coca Cola’s products is one of the most
important factors in a customer’s decision to buy. Price will often be the difference that
will push a customer to buy our product over another, as long as most things are fairly
similar. For this reason pricing policies need to be designed with consumers and external
influences in mind, in order to effectively achieve a stable balance between sales and
covering the production costs.
Price strategies are important to Coca Cola because the price determines the
amount of sales and profit per unit sold. Businesses have to set a price that is attractive to
their customers and provides the business with a good level of profit. Long before a sale
was ever made Coca Cola had developed a forecast of consumer demand at different
prices which inevitably determined whether or not the product came on the market, as
well as the allocation of adequate money and resources to produce promote and distribute
he product.
Pricing Strategies and Tactics
The pricing Strategy a business will use will have to focus on achieving the
marketing plan’s objectives and support the positioning of the product, and take external
factors such as economic conditions and competitors in to account. There are 5 strategies
available to business: Market skimming pricing, Penetration pricing, Loss leaders, Price
Points and Discounts. Over the years Coca Cola has used Penetration Pricing as a way of
grabbing a foothold in the market and won a market share. It’s product penetrated the
marketplace. Once customer loyalty is established as seen with Coca Cola it is then able
to slowly raise the price of its product. There has been a fierce pricing rivalry between
Coca Cola and Pepsi products as each company competes for customer recognition and
satisfaction. Till now it appears as if Coke has come up on top, although in order to gain
long term profits Coke had to sacrifice short term profits where in some cases it either
went under of just broke even, but as seen it has been all for the best.
Pricing Methods
Good pricing decisions are based on an analysis of what target customers expect
to pay, and what they perceive as good quality. If the price is too high, consumers will
spend their money on other goods and services. If the price is too low, the firm can lose
money and go out of business.
Pricing methods include: Cost based Pricing, Market based pricing and
Competition based Pricing. Over the years Coca has lost ground here in it’s pricing but
has regained its strength as it employed the Competition-based pricing method which
allowed it to compete more effectively in the fruit drink market. Leader follower pricing
occurs when there is one quite powerful business in the market which is thought to be the
market leader. The business will tend to have a larger market share, loyal customers and
some technological edge, thus the case currently with Coke; it was first the follower but
through effective management has now become the leader of the market and is working
towards achieving the marketing objectives of the Coca Cola. Survival in the market
place, own 60 % of market share by 2012, increase further awareness of product and a
return on 20% on capital employed for August 2012.
Promotion:
In today’s competitive environment, having the right product at the right place in
the right place at the right time may still not be enough to be successful. Effective
communication with the target market is essential for the success of the product and
business. Promotion is the p of the marketing mix designed to inform the marketplace
about who you are, how good your product is and where they can buy it. Promotion is
also used to persuade the customers to try a new product, or buy more of an old product.
The promotional mix is the combination of personal selling, advertising, sales
promotion and public relations that it uses in its marketing plan. Above the line
promotions refers to mainstream media: Advertising through common media such as
television, radio, transport, and billboards and in newspapers and magazines. Because
most of the target is most likely to be exposed to media such as television, radio and
magazines, Coca Cola has used this as the main form of promotion for extensive range of
products. Although advertising is usually very expensive, it is the most effective way of
reminding and exposing potential customers to Coca Cola Products. Coca Cola also
utilizes below the line promotions such as contests, coupons, and free samples. These
activities are an effective way of getting people to give your product a go.
Place and Distribution:
The place P of the marketing mix refers to distribution of the product- the ways of
getting the product to the market. The distribution of products starts with the producer
and ends with the consumer.
One key element of the “Place/Distribution” aspect is the respective distribution channels
that Coca Cola has elected to transport and sells its product.
Selecting the most appropriate distribution channel is important, as the choice will
determine sales levels and costs. The choice for a distribution channel for any business
depends on numerous factors, these include:
• How far away the customers are;
• The type of product being transported;
• The lead times required; and;
• The costs associated with transport;
There are four types of distribution strategies that Coca Cola could have chosen from,
these are: intensive, selective, exclusive and direct distribution. It is apparent from the
popularity of the Coca Cola’s product on the market that the business in the past used the
method of intensive distribution as the product is available at every possible outlet. From
supermarkets to service stations to your local corner shop, anywhere you go you will find
the Coca Cola products.
Physical Distribution Issues
Coca Cola needs to consider a number of issues relating to the physical
distribution of its fruit drink products. The five components of physical distribution are,
order processing, warehousing, materials handling, inventory control, transportation.
Coca Cola must further try to balance their operations with more efficient distribution
channels.
Order Processing
Coca Cola cannot delay their processes for consumer deliveries (i.e. delivery to
selling centers), as this is inefficient business functioning and is portrays a flawed image
of the product and overall business.
Warehousing and inventory control- warehousing of Coca Cola products is necessary.
Inventory control is another important aspect of distribution as inventory makes up a
large percentage of businesses assets. Choosing the correct and desired inventory measure
that Jackson’s sees as most effective is vital. Jackson’s must remember though that there
are factors involved with inventory control that can hinder the products sales and
customer perceptions (hazards, distribution from storage facilities, etc…).
Materials handling
This deals with physically handling the product and using machinery such as
forklifts and conveyor belts. When holding products, then Coca Cola has benefited from
purchasing or renting respective machinery.
Transportation
Transporting Coca Cola products is the one most important components of
physical distribution. Electing either to transport the sports drink by air, rail, road or water
depends on the market (i.e. global, or domestic?) and depends on the associated costs.
The most beneficial transportation method for Coca Cola would be ROAD if the product
were moved around from storage to the cost centers.
Implementing, Monitoring and Controlling
Financial Forecasts
Financial forecasts are predictions of future events relating strictly to expected costs and
revenue costs for future years. There are five major marketing expenditures, which
include research costs, product development costs, product costs, promotion costs and
distribution costs.
Sales force composite is the most logical method in forecasting revenue. This involves
estimates from individual salespeople to sell to work out a total for the whole business.
Once these costs and revenues are forecasted, management can then decide which
combination of marketing mix strategies will deliver the most sales revenue at the lowest
cost.
Implementing
Implementation is the process of turning plans into actions, and involves all the activities
that put the marketing plan to work. Successful implementation depends on how well the
business blends its people, organizational structure and company culture into a cohesive
program that supports the marketing plan.
For its further success, Coca Cola must impose several key changes. Production needs to
be on time and meet the quota demanded from wholesalers. It must also be efficient so as
not to build inventory stocks and inventory prices. The marketing needs to be motivated
and knowledgeable about the product. The forms of promotion such as advertising must
be attracting and enticing to the target market to get the greatest amount of exposure
possible for the product. This will ensure the success of the product in the stores.
Distribution of the product must be efficient. This problem has already been taken care of
with convenient transport routes to commercial areas and transport already being
arranged.
Monitoring and Controlling
Monitoring and controlling allows the business to check for variance in the budget and
actual. This is important because it allows Coca Cola to take the necessary actions to meet
the marketing objectives. There are three tools Coca Cola should use to monitor the
marketing plan. They are the following:
i. Sales Analysis
The sales analysis breaks down total business sales by market segments to identify
strengths and weaknesses in the different areas of sales. Sellers of Coca Cola products
vary from major retail supermarkets to small corner stores. This gives the products
maximum exposure to customers at their convenience.
ii. Market Share Analysis
Market share analysis compares Coca Cola’s business sales performance with that
of its competitors. Coca Cola looks to increase its market share by over 60%. With the
changes Coca Cola is currently undergoing, they aim to regain an iron fist control of the
market. Target market various age groups and lifestyles from high school students too
universities, and male or female.
iii. Marketing Profitability Analysis
This analysis looks at the cost side of marketing and the profitability of products,
sales territories, market segments and sales people. There are three ratios to monitor
marketing profitability; they are market research to sales, advertising to sales and sales
representatives to sales. The results of these three tools can help Coca Cola determine any
emerging trends, such as the need for a different product. Comparing these results with
actual results gives the business an idea on when to change.
iv. Market Research
When attempting to implement a new Marketing plan a business must address its
target market and conduct the relevant information to insure the new marketing plan both
differs from the old and is better for the business. When conducting market research a
business must first define the problem and then gather the appropriate information to
solve the problem. There are 3 types of information a business can gather to solve its
problems.
->Exploratory Research which clarifies the problem and searches for ways to address it.
->Descriptive Research is used to measure and describe things like the market potential
for a product and characteristics of the target market.
->Casual Research is used to test a hypothesis about a cause and effect relationship.
Coca Cola through its market research has addressed all three types of research to define
the problem raised by shareholders and gathered information to serve their needs.
Factors Influencing Consumer Choice
When making decisions on products a business must look at factors that influence
consumer choice such as psychological factors, Socio-culture factors Economic factors
and Government Factors.
Psychological Factors:
Such as motivation, perception, lifestyle, personality and self concept, learning,
and attitudes influence the consumer’s behavior towards a product and Coca Cola has
addressed this issue by introducing Diet Coke to satisfy different lifestyles.
Socio-cultural factors:
Such as culture, subculture, socio-economic status, family and reference groups
influence the consumer’s behavior towards a product.
Economic factors:
Such as Disposable income and discretionary income. Coca Cola has addressed
this side of the influence by maintaining a low price on the price of its products.
Government Factors:
Such as new regulations, inflation, interest rates all influence consumer spending
and choice.
Conclusion
Akij Group is one of the fastest business conglomerates in Bangladesh. Akij Group
growth is day by day increase and it Coverage: Around 90% of Bangladesh based on the
Annual Report-2008.The company of Akij Food and Beverage has a product line of
almost all the types of drink and snacks. We made an inquiry regarding customers find
solution for meeting the need of lemon flavored clear carbonated beverage within
Clemon’s target range the percentage is very good. It has not been long since Akij group
brought out Mojo and Lemu. They have already gained huge popularity. The recent
success of Akij group is Frutika, which delivers the promise of no preservatives.The
Group has plans for setting up more projects. The projects are already in pipeline. Foreign
investors have shown keen interest in joining with us for joint ventures. The matter is
under our active consideration and will hopefully soon mature. This will also help the
nation's economy growth and will create job opportunities to various professionals.
Akij Group is also involved in socio-cultural activities. The Group has been operating a
sizeable orphanage free of charge in district town. The Group has also acquired a modern
mother & children hospital previously owned by Save the Children (UK). The hospital is
being operated as a non-profitable concern. But the company needs to be more concerned
about society and environment. Because Industries are most responsible for pollution that
could occur harm for environment. And KEVIAN KENYA LIMITED also need to be
involved with more social event. Because have the resources necessary to solve the social
problems as many business organizations often have surplus revenues.