Monetaolpers brand

Product & price strategy

Final report

Group Members

Zumair zahidSana akbarHira sajid

Sehrish hussainFaizan ahmad

Company introduction

• Olpers• Our brand MONETA • New idea

Product alternatives

• Mint milk• Coconut milk• Date milk

SURVEY QUESTIONNAIRE

We have developed a survey questionnaire for the screening process. The results of questionnaire have shown highest percentage for the Mint milk, as people believe that Mint is a best and refreshing flavor and ingredient to add in milk. They perceive that addition of Mint in milk will provide them a refreshing and healthy drink. As we all know, people nowadays are very conscious about their health and are willing to pay for health products. People use to buy drinks that make them refresh and provide them with good taste. People look for different flavored drinks to refresh themselves. That’s why our new product Mint milk is a feasible product that will give us reasonable profits in future.

The graphical representation of our survey questionnaire is

as follows:

69%

31%

Do you want new milk flavors to come into market?

Yes No

Mint56%

Coconut28%

Date17%

Which new milk flavor you want to come into the market?

Mint Coconut Date

Yes75%

No25%

Do you think mint milk would be a healty drink?

Yes No

Yes72%

No28%

Do you think mint milk is best for health concious people?

Yes No

Children14%

Teenagers61%

Adults25%

For which age Mint milk would be best?

Children Teenagers Adults

Actual product development

• Idea generation• The development of the new product, brand start

with the concept. The concept we introduce is the flavored milk. A mint milk, we consider this idea as it was not present in the market, it would be a new experience for the people and the company. We generated this idea in coordination and a group discussion with the team members. In addition with the mint milk we also considered two more ideas as alternatives coconut milk and date milk.

screening

• This step is crucial to ensure that unsuitable ideas, for whatever reason, are rejected as soon as possible. Ideas need to be considered objectively, ideally by a group. In this step we considered all the alternatives had a research survey as the result of the survey mint milk was considered as the best option.

Business analysis

• After the screening process is over we would move to the of profit testing. In this phase we will consider whether the product would be profitable or not? Would it generate profit for the company? This include marketing strategy, highlighting the target market and full appraisal of the cost, competition and identification of a break-even point.

Product development

• After all the business analysis are made product would be consider in the technical and marketing development stage. In this step actual product is being made. The idea is given the actual product shape.

Product development schedule

tasks 1 2 3 4 5 6 7 8 9 design Eng.dept

12,000

4000

5000

6000

5500

Prototype shop

Drafting

3000

2000

1000

900 500

Testing Eng.dpt.

300 400 500 500

Testing dpt.

1000

1500

1200

1100

total 12,000

4000

5000

6000

8500

3300

2900

2600

2100

• Sample testing• When the concept has been developed and tested, final decisions need

to be made to move the product to its launch into the market. Pricing and marketing plans need to be finalized and the sales teams and distribution briefed, so that the product and company is ready for the final stage. Where we need to do a huge advertisement on tele media, bill boards etc. we need to make people aware of our product. We need to place the product heavily in the market it available for the customers to have it easily.

• Launch • When the concept has been developed and tested, final decisions need

to be made to move the product to its launch into the market. Pricing and marketing plans need to be finalized and the sales teams and distribution briefed

Product and service tactics

Our milk contain • Special and unique taste as it contains mint in it• It is specifically produce for the diet conscious people

and also healthy as well• Taste and the quality of our product will be

consistent• We add such ingredients which make the more

nutritious milk

Alternative Product Decision

• Our product is in the introductory stage as it will be launched soon

Product branding

• market gap• associate our product with different and

healthy products• Advertising• make strategies

Brand Extension Vs Unique brand

• New Product: Our Brand Moneta is the new product of Olpers. We will set the

target market and will do all the advertisement campaign to make people aware of the product.

• Flanker Brand Our brand Moneta is also came in the category of Flanker

brand as Olpers have the milk in the market and they are launching the milk again with the mint flavor for the different target market. It helps to increase the market share of the Olpers and it will be suitable for their product line as well.

Portfolio Management

• Establish & maintain a database of relevant information on the product, the market and the competition

• Evaluate key products in terms of customer satisfaction, competitive advantages and company expectations.

• Add value by improving features or reducing costs• Increase market penetration by identifying new uses and

new users• Look for gaps in the product line

Add Value to Existing Product

We can add value in our product by• By Changing the flavors• Add ingredients which enhances the

refrigerator life of Moneta milk• We will add those ingredients which will be

healthy for the oldies

Market penetration

• Through advertising properly we can achieve high revenue by converting nonusers into regular customer

• We will use campaigning schemes and keep on telling about the benefits of our product so the people attract towards our product

Pricing strategy

• Value based pricing

• Logic behind selection

Customer value Price Cost Product

Factors influencing perception of value

• Step 1: Identify the cost of competitive product or the process that the customer views as the best alternative

• Step 2: Identify all the factors that differentiate your product from the competitive product or process.

• Step 3: Determine the value to the customer of these differentiating factors. Sources of value may be subjective (pleasure) or objective (cost, profit)

Incremental cost

• Incremental cost is associated with our product Moneta as we can add more flavors in our product later

Sunk Cost

• We spend on machinery, buffaloes and on packing that cannot be reversed

Effect that influence buyers willing to pay

• Price Quality Effect: Our product gives so much quality to the customer

that they didn’t bother about the price of our product whether it is high or low.

• Fairness Effect: As our product is good for the health of the people

and it will make them a better and healthy person then they will not back off from our product as it will become one of the useful aspects for our customers.

Segmentation for value Communication and Delivery

• Value buyers Our product lies in the value buyer as we are

focusing more in giving the quality which people want from us and the relation between us and customer is value base pricing.

competition

• New flavor• Unique

Reacting to competition

Q1. Is there a response that would cost less than the preventable sales loss?

• we would not directly respond to it if our competitors go for some discounts etc. as we our introducing a new flavor in the market and already set affordable prices we would not go for reducing the price or offering discounts at this very start as the customer wants to taste new flavors they would pay for it and our sales would not be affected as such. We our having a competitive advantage of new flavor over which would match the pricing decision and not let us to cut our original prices.

Q2. If you respond is competitor willing and able to cut price again to reestablish the price difference?

• as the 1st price cut of the competitor did not affected our customers. Now we can think of giving some discounts to our customers in way that own purchase of 250ml bottle 50ml free pack so that to grab more customers.

Q3: will the multiple responses required to match a competitor still cost less than the avoidable sales loss?

• Ans: now stop with the price war and let your competitor what he wants to do with his pricing strategy and you remain with your pricing you have set lastly.

Q4: Is your position in other markets threatened if a competitor is successful in gaining the share? Does the value of the markets at risk justify the cost of a response?

• Ans: as we are entering with entirely different flavor in the market we need strengthen our position in the market and grab the market share as much as we can. For this purpose if we need to cut the price and respond to the competitor we could go for it.

Our reaction

• We think to go with attack where the competitor is weak having justified price. We can come up with strong new idea with neutral price to attack the competitors and grab more customers.

PRICING STRATEGY:

Our pricing strategy involves establishing cross functional objectives and synergistic goals so that our company can profitably produce and capture value. Our product price is set to maximize profitability for each unit sold or from the market overall.PROACTIVE PRICING:As we are not entering in the entirely new market, we are reevaluating pricing strategy in a market where the firm is already doing business, it is better to us to begin from inside out, beginning with price structure and process, then value-based marketing strategy, and finally competitive strategy.

THE PRICE STRUCTURE:

The price structure consist of two elements:

• Segmentation Fences• Value Metrics

SEGMENTATION FENCES:

These are criteria that customer must meet to qualify discounts e.g. age, educational status. For our new product Moneta Mint Milk, Segmentation fences are based on age (with discounts for teen agers and sports persons under eighteen and seniors).For our product, segmentation fences work well because our product is not worth the effort to resell.

VALUE METRICS:

They are the units to which the price is applied e.g. per hour, per visit, access, performance, time of day and season of the year. We could vary prices by season of the year like mint milk would be more preferable in summers as compared to winters so we could charge more prices in summer as drinks are in high demand on that season of the year.

THE PRICING PROCESS:

Our process for setting price levels within the structure is proactive. As our company is flexible, adaptable and focused on continually improving their customer service, productivity, efficiency and workplace environments. We go for price proactively incorporating different customer needs while maintaining price integrity to establish value based price integrity because customers are different in their needs and therefore in what they will pay for, our pricing policy must accommodate those differences.

VALUE BASED MARKETING STRATEGY:

In our strategic pricing we establish value based marketing goals for the creation & communication of value. Value based marketing allows customers to make easy comparisons between competing prices.CREATING CUSTOMERS BENEFITS:Our company’s marketing efforts add value by creating an internal understanding of the benefits that customers seek and organizing the company to supply those benefits. Our company understands the customers’ needs well enough to make that potential a reality.

COMMUNICATING THE VALUE PROPOSITION:

We efficiently communicate the value of our product to the customer through our effective marketing efforts because value based pricing will fail unless customers actually perceive the value for which the pricing process and price structure are designed to make them pay. The purpose of value communication is to raise uninformed buyers’ willingness to pay to a level that we want to achieve.

PROFIT-DRIVEN COMPETITIVE POSITIONING:

We identify segments of the market that we can serve profitably and position itself to do so. We have chosen the following method to determine potential profitability:NEUTRAL PRICING:We adopt neutral pricing strategy because conditions are not sufficient to support either a skim or penetration strategy because both of them are extremes of pricing strategy and for our new product Moneta Mint Milk, we cannot charge very high price as well as very low price as if we go for very high price, people would not be willing to pay a very high amount for just a drink. On the other hand, if we charge a very low price then people might think that the quality of our product is very low that’s why we have to go for neutral pricing strategy that’s a perfect balance between skim and penetration pricing strategies.

Introductory stage

Strategies for Introductory stageResearch and development department would be the most important factor as they would conduct a market survey (questionnaire)

We would have a competitive advantage (different new flavors) over our previous products which would increase its sales in market.

We would have aggressive promotion of our product

Marketing innovation through price induced sampling:

As our product is of mint milk, and would we manufactured in large quantity due to low incremental cost incurred in the manufacturing, and its benefits or taste is obvious after just one use. It is one of the effective ways to educate the buyers or introduce our product by sampling

Marketing innovation through distributation channels:

Co-op advertising:

We will place our stale outside the departmental store or inside the mall. We will do advertising with them also they will place our broshers’ display in their stores and malls.

Premium shelf space:

We will provide the proper shelf to clear display our product in the store or mall.

Growth stage Strategies for Growth stage

As we are getting profit so we would try to enter and target as many as consumers we can.

• We would find different markets and increase our distribution channels, different retailers with fewer prices.

• We would make different sizes of our mint milk 2 litl, 20 ml.

• We can place our small stalls in the schools university

pricing Differentiated product strategy: • In this we will direct our marketing efforts towards developing unique attributes

(or images) for our product.

• In this strategy is focus Pricing the differentiated product directed industry wise.

• In this we will use the neutral pricing strategy.

Maturity stage

Strategies for Maturity stag• As now we are old in the market we have to keep our place safe.

• We would do market research again to know about consumer’s perspective about our existing mint milk flavor.

• Discounts as ( buy one 2litle pack and get one 2ml pack free)

• We can also launch our product in entirely different area with different strategy and price to remain in market.

Pricing maturity stage . At this stage we have sustainable share in the market. Weak Competitors' are whipped out.

• In our product (mint milk) we have used different healthy vitamin which would be differentiating our product with the competitor’s product.. Otherwise it would also affect our sales and our brand image

• In this we will be changing our packaging, label, and also add some new and unique ingredients. Which we would reintroduce our product to the customers with different look

Decline stage Strategies for Decline stage• At this stage we can reduce the advertizing, promotions, • production of our product.

• Now we will start to remove this product from the product line slowly reducing the production.

• The other alternative is that we can search for such market which also has some chances for our growth as in less recognized areas to completely finish the inventory.

Alternative strategy in Decline: • in this last stage we would we using the retrenchment strategy. • Retrenchment• It involves either partial or complete surrender of some market segments to

refocus resources on others where the firm is in stronger position. • In this we would shift all recourses of mint milk –coconut milk production. In this

we only have to change our core ingredient only.

Segmented pricing according to our product

• By purchase quality: (B2B)As our company is only manufacturing the mint milk in

the production section. In this we will sell the mint milk in the form of different batches to the retailers or other distributers.

• Volume discounts: • In this we would offer the retailers the discounts if

they would buy the mint milk in bulk .

thank you