Report on Marketing of Cocola Instant Noodles

Executive Summary
This document portrays the current status of Cocola Instant Noodles and recommendations to improve the product to generate more demand for it. First, the history of Cocola Food Products Ltd. has been briefly discussed. Then the market for instant noodles is reviewed using the information collected by Nielsen. The market for instant noodles is growing at 40% MAT. Then, the product portfolio of Cocola has been evaluated to find whether they conform and which markets they have targeted to serve. Then a competitor review was shown to pinpoint Cocola’s strategic location and the strategic positions taken by its competitors.
Then, the market has been segmented using two variables: demographic and geographic. Cocola can serve the niche markets at present provided by the B2B prospects and also use its brand reputation to create awareness for Cocola Instant Noodles (CIN). Cocola have around 200 distributors in Bangladesh and this is one of their strengths since they can make all their general purpose distribution carry this item. So, their main challenge is create awareness, interest and desire among the target market. Till now, they have not been successful to communicate to major portion of their target market about CIN. The primary target market for Cocola is children between the ages 7-12. And secondary target market is mothers who make the purchase in most case.
Then, analyses were done to find out the strengths and weaknesses of Cocola instant noodles, Maggi instant noodles and Fu-Wang instant noodles. The market for this product is growing and this product itself is in growth stage. This calls for large promotional spending in order to capture maximum market share. Cocola have higher resource constraint compared to Nestlé, which is a MNC. Thus, Cocola has to be content with follower strategy at present. PEST analysis revealed a trend of dual working parents rising in Bangladesh. Thus, the need for quick snack items is growing. Using conjoint model, the most important wants of consumers were identified as taste and price.
After analyzing the current situation, the marketing objectives were set and they include all the 7Ps of marketing mix. Product differentiation will be not only in terms of packaging and labeling but also in terms of taste. Tastemaker is the most significant point of differentiation now. So, giving the target market the taste they desire most will attract and create a loyal customer base. Price will no longer be set at going-rate but value pricing will be used. Consumers must feel that the value provided by this product created delight for them. Meeting their expectations in terms of quantity and quality is not enough. Providing different tastes will make consumers feel they have a choice.
From time to time, promotional efforts in terms of discounts and gifts will create delight. Cocola needs to make sure that they have a separate shelf in supermarkets as that is where most sales volume can be achieved. Also, the sales force will no longer be working on a straight commission basis. They will be given commission based on the number of accounts they create and sales volume they generate. It will be communicated to the sales force clearly and firmly with no room for misunderstanding.
Finally, a control system has been incorporated in the marketing objectives to guide the future actions to be taken. Feedback from the sale of product re-launch after first three months will be used to determine the demand for each product variant. That will determine the number of manufacturing lines that will be operated from the fourth month. Suppliers of the tastemakers will initially be given a small order to cover three month production. Then, the demand for each variant will determine how much of each will be bought. Again, packaging costs will be same but the different colors will mean different manufacturing lines have to be run for each or they have to be packaged alternatively. Thus, training the workers so that the right tastemaker is put in the packet will be given. This will be easy as different colors will be used for each taste. The package of the cake and tastemaker will have the same color to make learning easy. This is a two-year marketing plan and the results and feedback from this plan will provide insights to prepare the next marketing plan.

1 Introduction
1.1 Origin of the Report
This report “Marketing Cocola Instant Noodles: Reviving a Classic Brand” is a partial requirement of the course M 302: Marketing Management, instructed by Dr. Syed Ferhat
Anwar, Professor, Institute of Business Administration, University of Dhaka.

1.2 Problem and Purpose
The purpose of the report is to improve the marketing mix and build a marketing plan for the product Cocola Instant Noodles of the Cocola Food Products Limited. Although
the Cocola Egg Noodles of the company is very well known and successful in the market, the instant noodles, which was launched a couple of years back, failed to gather
significant market share or gain respectable market growth. They are facing intense competition from both Maggi and Fu-Wang. The main problem faced by them is the
domination by Maggi in the instant noodles market in terms of brand preference and also in terms of product variety and quality. This problem is further augmented by
inefficiencies in the distribution channel of Cocola and also the image of Cocola Instant Noodles as being imitators of Maggi Instant Noodles.

1.3 Scope
This report deals with the marketing strategy for Cocola Instant Noodles. It has been prepared by analyzing the present situation of Cocola Instant Noodles, Maggi Instant
Noodles and Fu-Wang Instant Noodles in the market. Also involved are the current marketing strategies, the product and marketing mix and the distribution network used
by these companies. Based on the surveys which were conducted, a new marketing strategy has been proposed.

1.4 Sources and Methods of Collecting Information
The sources of information were interviews of the employees directly related to the marketing of the products of the respective companies, regional surveys taken from
various areas, and a consumer survey of a randomly selected group of people. The interviews were based on a standard questionnaire and the interviewees were asked
for their own opinions as well as the factual information of the respective companies. The regional surveys were directed at the shopkeepers of various places. Finally, the
consumer survey was based on a questionnaire which has been attached with the report. After gathering the data from these surveys, analysis was done based on them to
get the present situation for the product and the insights for the future provided. And using those guidelines, a new strategy was formulated.

1.5 Limitations
While preparing this marketing plan, there were few issues which hindered the depth of the report. The main limitations were:

• Lack of marketing information system (MIS) in Cocola
• The companies were reluctant to share financial information
• Some companies have provided estimated data
2 Company Review
2.1 Background

Cocola Food Products Ltd. started its journey back in 1973 as Baby Food Products which was a sole proprietorship. It became a private limited company in 1985.
The company initially produced Cocola candy and toffee. Gradually they started producing various kinds of biscuits. Cocola was the first company to introduce the use of foil paper in the food
products industry. The foil paper was imported from Singapore, Japan and Korea. Cocola acquired Sunstar Beverages as a sister concern. Now it has two SBUs;
Cocola Foods and Sunstar Beverages.

2.2 Products
Some of the products of Cocola Food Products Ltd. are:

(a) Noodles: (b) Biscuits:
1. Cocola Egg Noodles 1. Cocola Champion Biscuit
2. Cocola 2 Minute Instant Noodles 2. Vita Plus Biscuit
3. Cocola Cook Noodles 3. My Protein Marie Biscuit
4. Cocola Mojadar Egg Noodles

(c) Candy & Chocolates: (d) Wafers:
1. Gems 1. Banana Wafer
2. Fruit Candy 2. Chocolate Wafer
3. Kiss Candy 3. Pineapple Wafer
4. Lichi Chocolate 4. Milk Mini Wafer
5. Milk Fruity 5. Chocolate Roll Wafer

6. Milk Candy
(e) Chips: (f) Drinks (Non-Carbonated)
1. Potato Chips 1. Fruity Cup
2. Caramel Corn Crackers 2. Lichi Gel
3. Twister – Tomato Flavor

2.3 Mission Statement
Since Cocola Food Products Ltd. does not have a mission statement, we have proposed one based on the objectives and vision of the management.
“To meet customer expectations and trust by providing an assortment of affordable nutritious products of good taste and convenience without compromising on quality or
hygiene.”

3 Market Review
3.1. Overview of the Noodles Market
The market size for noodles is 9000 tons+ per year (Approximate). Two types of noodles are available in the Bangladeshi market. They are:

i. Instant Noodles
ii. Air Dried Noodles

i. Instant Noodles:
Instant noodles come with a packet of flavoring called tastemakers. Instant noodles are eaten after being cooked in boiling water for 3-5 minutes and added with tastemaker.
The market size for instant noodles is 4000 tons (approx.) which is equivalent to 45% of the total noodles market.The current market leader in this segment is Maggi by Nestlé with a market share of 57% (Oct ’08). Source: Nielsen

ii. Air Dried Noodles:

Air dried noodles, also referred to as traditional noodles, is first boiled in water, then the water is drained and finally it is cooked with oil and other ingredients
like egg, vegetables, etc. The market size for instant noodles is 5000 tons (approx.) which is equivalent to 55% of the total noodles market. The current market leader in this segment is Cocola Egg Noodles with a market
share of 64% (Oct ’08). Source: Nielsen Since this report focuses on marketing Cocola Instant Noodles, only the market for instant noodles will be reviewed.

3.2 History of Instant Noodles in Bangladesh

Cocola Food Products Ltd. introduced stick (air dried) noodles in Bangladesh in 1987. Instant noodles were first brought to Bangladesh by Fuji. It came with a tastemaker and a small packet of oil. Now oil is not given with any instant
noodles due to packaging problems. Within a very short time, in 1997 Transcom Food brought Maggi Instant Noodles from Pakistan. Now it is the flagship brand of Nestlé Bangladesh Ltd. Other companies such as Banoful and Korean company named Tasty followed them with their own instant noodles. Cocola Instant Noodles was launched in 2001. The current competitors for Cocola Instant Noodles are Maggi, Fu-Wang, Bangas’ Dragon, etc.
Companies like Sajeeb Corporation, Akij Group of Industries and Square Consumer Products Ltd. are also thinking of introducing their own instant noodles.
3.3 Market Trends

The instant noodles industry has been growing at 40% With the increasing number of working mothers, it has become a very popular tiffin for children and evening snack for the family as it is very easy to cook and
takes less time to prepare than the air dried noodles. The growth is also driven by price point players with their multi-packs. There has been a clear emergence of a price point segment diving the market into Maggi and others especially Fu-Wang. The consumers are price driven, looking for value for money.
There has also been an increase in the awareness of nutritious food.
Emerging “modern trade shopper”
3.4 Market Needs

The basic needs of the instant noodles market are quick preparation time, tasty and
healthy product, and a certain variation of tastes, which means different flavors. These
needs can be further put into categories based on the use and preparation of the instant
noodles.
In Bangladesh, we use instant noodles mostly for lunch break or snack purposes for the
children as well as for other members of the family in school, work and at home. In
these cases variation of tastes and quality of the product comes in action. When the
children are given noodles as lunch, they prefer to have some added taste and variety to
their food. If we give them the same flavor all the time, they lose their interest in the
food. This same condition applies when noodles is used as snacks. This is one of the
many reasons why Maggi captured market share so quickly and also for this reason
most of the instant noodles come with more than one flavoring.
Another factor is preparation. Women who are homemakers can afford to take time to
prepare noodles either for snack purposes or for their children’s tiffin by mixing several
ingredients in it. And for this reason the Cocola Egg Noodles have been popular and has
a large market.
But recently, in our country, there have been changes in the role of women in a family.
Today, a lot of mothers living in the urban areas of the country are working mothers and
they play a vital role in family’s income and purchase decision making. For the working
mother, the time and the process of preparation is quite important. Working mothers
prefer a quick and hassle-free method of preparing food. And thus, a rise in the number
of working women has also induced the need for food products that are easy to cook
and takes less time to prepare.
4 Product Review
4.1 Summary
The noodles section of the Cocola Food Products has the following types of noodles
which they produce, package and sell:

4.1.1 Cocola Egg Noodles
Also known as the Cocola Stick Noodles in most of the markets, this has been the most
successful of all the Cocola noodles products. The unique thing about this product is the
preparation method. The Egg Noodles is made up of air dried noodles sticks. It naturally
comes with a single flavor and with two packaging (red outer line or yellow outer line,
red outer line being the more popular). According to Cocola and also its competitors,
this preparation method gives Cocola a competitive edge over all others, because none
of the other companies have as good machinery for making air dried noodles as Cocola
does. And for this reason, this air dried Egg Noodles has been the most popular of all the
Cocola Noodles products.

4.1.2 Cocola 2-Minute Instant Noodles
This is the instant noodles product of Cocola. A packet of instant noodles contains a
noodles cake and a flavoring known as taste-makers. Cocola Instant Noodles is available
in the market in two flavors – Chicken Masala and Beef. The taste-maker is actually
produced in Japan but they are imported from Singapore. The preparation method for
this type of noodles is completely different from that of the air dried noodles. The
cooking method is also different. This noodles mostly targets those who wants to have
noodles with as less cooking hassle as possible. But this Cocola product is far behind
than the Egg Noodles, as the market is mostly dominated by Maggi and Fu-Wang.

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4.1.3 Cocola Cook Noodles and Cocola Mojadar Noodles
These products are comparatively new in the market. Both of them contain the same
type of noodles but in different packages and different sizes. The Cook Noodles is of a
larger size, mostly for families. The Mojadar Noodles is of a smaller size. The noodles
cake that is used is similar to the instant noodles in shape but contains air dried
noodles. So, although they have the same appearance as the instant noodles, the cooking
method and taste are different because of their production method.
For this marketing plan we have chosen the Cocola Instant Noodles and we have tried to
show the way in which we can increase the market share and awareness of this product.

4.2 Availability
As will be discussed later in detail, Cocola Food Products Ltd. has a good distribution
network. Their products reach a lot of places where other companies fail to deliver their
goods. Although this distribution network is based on other products rather than Cocola
Instant Noodles, nevertheless, Instant Noodles also reaps some benefit over this broad
distribution network. The Instant Noodles is available in almost all the places where
other Cocola Food Products are available. But, since they are not very popular in the
country-side, their numbers are small. As all of our surveys showed, many village shops
that have noodles supplied to them (mostly Cocola Egg Noodles) also have few packets
of Cocola Instant Noodles available in their stock.

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5 Competitive Review

5.1 Maggi Instant Noodles (Nestlé Bangladesh Ltd.)
Maggi Instant Noodles is the biggest player in the
instant noodles market in Bangladesh with a market
share of almost 57%. It is a brand under the flagship
of Nestlé Bangladesh Ltd. Since this product is very
generic and variations are possible only in the form
of taste and quality, the market is very competitive
with high entry barrier and exit barrier. It requires
specialized machinery to produce the cake. The
tastemaker for Maggi is imported from Malaysia
while Cocola brings its tastemaker from Taiwan.

5.1.1 Product
The product range includes:
 Maggi 2 Minute- Masala (Pack size: 62g & 248g) @ Tk.13 & Tk.52
 Maggi 2 Minute- Curry (Pack size: 62g & 248g) @ Tk.13 & Tk.52

5.1.2 Pricing
Maggi gives trade discounts to retailers but consumers are not directly given any
concessions at present. It has been successful to make the economy pack (4 packs in one)
look less expensive compared to its single pack. Consumers feel they are buying at a lower
price though the price is same. The general conception with large packs being more
economic is being exploited successfully.

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5.1.3 Marketing
Nestlé has a massive marketing budget worldwide. It can cover Bangladesh market by
placing advertisements on Indian TV channels like Cartoon Network, Star World, etc. In
Bangladesh, Maggi has become the other name for instant noodles. People mistake
Cocola instant noodles as “Cocola’s Maggi” and Fu-Wang instant noodles as “Fu-Wang’s
Maggi” in the rural and semi-urban areas. Nestlé Bangladesh Ltd. provides shelves in
various supermarkets and has good delivery system. Its marketing strategy includes the
following:
 Innovation & renovation
 Low cost and highly efficient operation
 Product availability- Maintain existing distribution with more effective Point of
Purchase (POP) excellence
 Consumer communication- Establish Maggi as the best tasty and healthy noodles,
which cannot be compared.

5.1.4 Goals
 Be the no.1 preferred snacks in Bangladesh for children aged between 10 to 12 years
 To become no.1 preferred snacks for all kids in the country
 Establish Maggi as the best tasty and healthy noodles (for children), which cannot be
compared

5.1.5 Competitive Position
Nestlé is finding it very easy as the market leader in this category with its brand Maggi.
Maggi has successfully captured market share, mind share and heart share of its target
market. When Cocola slashed its price by Tk. 2, Maggi’s sales was unaffected. Price alone
cannot upset Maggi’s loyal customer base. Internationally, Maggi has been criticized of
claiming to provide protein though its protein content is lower than the amount needed
daily.

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5.2 Fu-Wang Noodles (Fu-Wang Foods & Beverage Ltd.)
Fu-Wang Noodles is the market challenger with 19%
market share. It is owned by Fu-Wang Foods & Beverage
Ltd. in Bangladesh. They import tastemaker from Taiwan.
Their noodle is to be cooked for 3 minutes not for 2
minutes like the other instant noodles. Consumer
preference is not affected though.

5.2.1 Product
The product range includes:
 Fu-Wang Noodles- Beef (Pack size: 70g, 280g, 560g & 700g) @ Tk.12, Tk.45,

Tk.95 & Tk.110
 Fu-Wang Noodles –Chicken (Pack size: 70g, 280g, 560g & 700g) @ Tk.12, Tk.45,
Tk.95 & Tk.110

5.2.2 Pricing
Fu-Wang gives trade discounts to retailers but consumers are not directly given any
concessions at present. But it has priced its 10-in-1 pack at Tk. 110 which has resulted
in huge trade volumes for them. It has been successful in increasing its sales volume in a
short time.

5.2.3 Marketing
Fu-Wang is currently placing shelves at all major supermarkets. This move was taken
recently and thus time will tell its effectiveness. It is also considering the production of
TV ads to be broadcasted in the major Bangladeshi channels. Due to lack of initiative on
their owners’ part, marketing seems to be an undernourished child of the company.

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5.2.4 Goals
 Capture maximum market share in volume sold
 Use extensive distribution channels to make Fu-Wang Noodles available at all sales
points

5.2.5 Competitive Position
Fu-Wang is set to topple Maggi but lacks in marketing initiatives. With only retailing
promotion and lack of innovativeness, they seem to progress slowly. Their main
differentiating point is their tastemaker which is less spicy and tastes like chicken soup.
Their target market is different in terms of taste.

5.3 Others
Currently there are some nichers like Dragon Noodles (Bangas Ltd.) and some foreign
brand of noodles from Thailand, Indonesia and Malaysia. However, Sajeeb Corporation,
Akij Group of Industries and Square Consumer Products Ltd. are planning to introduce
their noodles division soon.

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6 Market Segmentation & Targeti ng
Two groups of variables have been used to segment the market for instant noodles.
6.1 Geographic Variables
Geographic segmentation has been used to divide the market into four different
geographical units. These units are:

• Metropolis  City Corporations
• Urban  District Headquarters
• Semi-urban  Sub-district Headquarters
• Rural  Unions and Villages
The four geographical units have been identified using the date from the Statistical
Yearbook of Bangladesh.

6.2 Demographic Variables
In demographic segmentation, the market is divided into groups on the basis of social
class. Five social classes have been identified. These are:
i. Upper
ii. Upper Middle
iii. Middle
iv. Lower Middle
v. Lower
The various social classes have not been defined here since they vary according to
different geographical area.

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Metropolis Urban Semi-urban Rural

Upper

Upper Middle

Middle

Lower Middle

Lower

Figure 1: Segmentation Grid

The shaded grids have been chosen as the target markets for Cocola Instant Noodles.
Instant noodles have gained popularity as an evening snack and as tiffin for school going
children. The price is a bit high compared to the stick noodles which are more popular
in the rural and semi-urban areas. Since Cocola Food Products Limited has a wide
distribution network compared to its competitors, it will be easier for them to reach
those distant markets.

D
E
M
O
G
R
A
P
H
I
C
GEOGRAPHIC
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6.3 Specific Target Groups

• Housewives

• Bachelors
• Teenagers
• Working women
• Children
• Students
• Sick people
• Restaurants

The list above shows the target groups of Cocola Instant Noodles. The highlighted ones
are the groups that will be focused on more. We have divided the main target groups
into two further parts:

– Core Target Group: Children 7-12 years
– Secondary Target Group: Mothers 25-40 years (Major decision makers)
6.4 Niche Markets
Apart from the market segments described above, Cocola Instant Noodles will also try
to capture some untapped markets in Bangladesh.

6.4.1 Fast Food Shops and Restaurants:
None of the companies in the instant noodles market are targeting this sector though
there is a huge B2B prospect in this market. Fast food shops and restaurant all over the
country serve Chowmin, Noodles, Noodles Soup and Chop Suey buy huge amount of
noodles from retailers. Cocola can arrange deals with them to provide them all the
noodles they need directly in bulk at a discounted price.

6.4.2 School, College and University Cafeterias and Canteens:
Canteens and cafeterias serve noodles during the breaks or in the afternoon. The instant
noodles companies have not been able to utilize this opportunity.

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6.4.3 Collaboration with Picnic Spots:
Cocola can make arrangements with various picnic spots around the capital where they
can provide noodles as an evening snack.

The niche markets mentioned are untapped areas where Cocola can enter thus creating
its own blue ocean.

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7 Distribution Review
7.1 Overview
In the Bangladeshi instant noodles industry, the distribution channel mainly comprises
a single distribution channel where buyers may be classified as habitual shoppers. The
distribution channel is crucial because push strategy is more or less widely used by the
companies involved in this industry. Most of the companies use intensive although some
use selective distribution technique.
The distribution channel is often a two-level indirect marketing channel consisting of
the manufacturer, wholesaler (known as distributor), retailer and the final consumers.
There is no specific distribution channel for Business to Business (B2B) market, but
some of the companies are now thinking about catering to the untapped B2B market.
The distributors play a major role in breaking bulk and supplying the product in
different markets throughout the Bangladesh. The structure and number of distributors
of the major players vary in terms of number and size, as seen below.

7.1.1 Cocola Food Products Ltd.
Cocola Food Products Ltd. is a well known company in the Bangladeshi fabric with
popular products like Cocola Egg Noodles (air dried noodles), Champion biscuit, Gems,
Wafers, etc. The company has around 175 distributors throughout the country. There
are some sole distributors of Cocola, although numbers could not be provided. The vast
distribution channel is a huge strength for CIN, which has not been levered. The
distributors are paid a commission of 7-8% as Cocola pursuits push strategy.

7.1.2 Nestlé Bangladesh Ltd.
Nestlé Bangladesh Ltd. is a large-scale multinational company providing various kinds
of food items like coffee (Nescafé), chocolate (Kitkat), baby food (Cerelac) in addition to
Maggi 2-Minute Noodles. They have 78 distributors under 48 sales territories. The
distributors are paid a commission of around 5% on sales and they have indeed been
successful in capturing more space in retail stores and superstores.

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7.1.3 Fu-Wang Foods & Beverage Ltd.
Fu-Wang Group is a conglomerate where Fu-Wang Foods & Beverage Ltd. manufactures
various food items like cake, biscuit and bread apart from instant noodles. The group as
a whole has a distributor base of 950. No concrete information could be provided for
Fu-Wang Foods and Beverage Ltd. regarding the number of distributors. It pays
commission of 5% to the distributors. The company also sells directly to large-scale
retailers and it is the only company following multi channels. Fu-Wang, like Cocola, has
failed to utilize the distribution channel to the maximum.
In spite of having a limited distribution channel Nestlé has been very successful in
distributing Maggi. In fact, Maggi is widely available in semi-urban areas and suburbs.
Although Nestlé has limited number of distributors, the volume traded is large
compared to that of Cocola or Fu-Wang. Also, Cocola and Fu-Wang have not set up
specifically territorial distributor which has resulted in some overlaps.

7.2 Logistics
In this industry warehousing is provided mainly by the distributors although the
manufacturers have warehouses too. Inventory management is not very sophisticated
here. Transportation is provided by the distributors in most cases. Orders are taken by
the sales representatives working under distributors who visit stores once a week in
average (in Dhaka) and deliver the products in 2-3 days. It is important to note that
Nestlé has successfully built profitable partnership with the distributors by placing
advertisements of Maggi on their vehicles.

7.3 Channel Conflict
Since most of the companies are involved in a singular channel, there is no channel
conflict. Fu-Wang, however, sells directly to large-scale retailers including superstores
and department stores (removing distributors). However, the retailers have to place
orders on their own before the goods can be delivered. Channel conflict is not prevalent
because orders placed are usually in bulk (which serves the function of wholesalers)
and also because considerably few transactions are taking place.

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8 Environment Analyses
8.1 SWOT Analysis

8.1.1 Competitor Information
Cocola Food Products
Ltd.
Address 5/1 Nazimuddin
Road Dhaka-1100

Nestlé Bangladesh Ltd. Fu-Wang Foods &
Beverage Ltd.
Gulshan Tower (4

floor) Plot 31, Road
53, Gulshan North C/A
th
House 12/1, East Kuni
Para, 1/A Tejgaon
Web address Not available www.nestle.com www.fuwanggroup.com
Annual Sales 750 tons+ 2280 tons+ 760 tons+
Market
share
18% 57% 19%
Table 1: Competitor Information

8.1.2 Strengths
Score (Cocola)
Factor Weights Raw Weighted
Product Quality 0.30 3 0.90
Width of Distribution Channels 0.25 4 1.00
Market Share 0.25 2 0.50
Brand Reputation 0.15 3 0.45
Product Lines and the Width 0.05 4 0.20
Total 1.00 16 3.05
Table 2: Strengths of Cocola Instant Noodles

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Product Quality of Cocola Instant Noodles (CIN) is fairly decent although there have
been some minor mishaps in quality control.
The Distribution Channel is very wide spread. It is primarily because of the other food
products like Cocola Champion Biscuit, Cocola Potato Crackers and Cocola Wafers.
The sales volume of CIN is barely 10% of the whole instant noodles market. The market
is strongly dominated by Maggi Instant Noodles produced by Nestlé Bangladesh Ltd.
In terms of Brand Reputation of instant noodles, Maggi has an upper hand but the
reputation of Cocola Stick Noodles affects the overall reputation of Cocola.
Unlike its competitors, Cocola Noodles has many product lines with considerable width.
For example, Cocola alone has four different types of noodles.

8.1.3 Weaknesses

Score (Cocola)
Factor Weights Raw Weighted
Scale of Production 0.20 3 0.6
Management 0.25 4 1
Efficiency of Distribution
Channels
0.20 4 0.8
Promotion 0.20 4 0.8
Financing 0.15 3 0.45
Total 1.00 18 3.65
Table 3: Weaknesses of Cocola Instant Noodles

Due to the smaller scale of production, the average production cost of CIN tends to be
higher compared to large-scale producers like Maggi.
The management of Cocola Food Products Ltd. is quite disorganized and inefficient.
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In spite of the very widely spread distribution channel Cocola Food Products Ltd. has,
the distribution channel is not very efficient. Promotion refers to the effectiveness,
willingness and significance of the spending on promotion techniques by Cocola.
Apparently, Cocola is doing poorly in this variable. Unlike its competitors, Cocola Food
Products Ltd. has a narrower scope of financing. It is a mere private limited company.
1

Strengths 3

5

Weaknesses
1 3 5


Cocola Instant
Noodles
Figure 2: Grid for Strengths & Weaknesses of Cocola Instant Noodles

8.1.4 Opportunities
Score (Cocola)
Factor Weights Raw Weighted
Niche Market Catering 0.35 4 1.40
Overall Market Size 0.25 4 1.00
Market Growth 0.20 3 0.60
Cushion effect of the Meltdown 0.10 3 0.30
B2B Prospects 0.10 3 0.30
Total 1.00 17 3.60
Table 4: Opportunities of Cocola Instant Noodles
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CIN has opportunities in niche market catering, since there is a niche market for noodles
which is still untapped.
The overall market size of the instant noodles is quite large, although the product is
mainly consumed in the Metropolitans and the urban areas. This has taken place due to
the economic development of Bangladesh in the recent years.
The Market Growth Rate of the Instant Noodles industry is seeing an increasing trend
basically due to the increase in the percentage of working population, advertisements in
the local and foreign media and influence of children in the buying pattern of
households.
In spite of the global meltdown the world economy is facing, the cushion effect of the
Bangladeshi market is helping Cocola Food Products Ltd. produce CIN.
With the mushrooming of the various shopping malls with food courts, the B2B
prospect of CIN is on the rise since the shops of these food courts demand Instant
Noodles.

8.1.5 Threats

Score (Cocola)
Factor Weights Raw Weighted
Competition 0.35 4 1.40
Substitutes 0.20 4 0.80
Benchmarking 0.20 3 0.60
Perception of Local Made Foods 0.15 3 0.45
Economic Downturn 0.10 3 0.30
Total 1.00 17 3.55
Table 5: Threats of Cocola Instant Noodles
Competition is the biggest threat of CIN. This is primarily coming from Maggi, which
captures roughly 80% of the Instant Noodles market.
23
CIN is also facing threats from indirect substitutes like chicken nuggets, sausages and
even stick noodles.
The sales promotion requirements have been made very high by the Nestlé’s Maggi.
Since Maggi is marketed by pull strategy and CIN by push strategy, the benchmarking by
Maggi acts as a substantial threat to CIN.
There is a negative perception of locally produced food products. This affects CIN in a
bad way.
The economic downturn has resulted in the slowdown of the economy in certain
sectors. This external factor would affect those in the downturn-hit sectors.
1

Opportunities 3

5

Threats
1 3 5
Cocola Instant
Noodles

Figure 3: Grid for Opportunities & Threats of Cocola Instant Noodles

The variables as well as the weights were obtained from the interview with
administrative officers of Cocola Food Products Ltd.

24
8.2 Extended BCG Matrix

Star
Cash Cow
Orphan
2
3
5

Question Mark
Under Developed
10 1 0.1

Figure 4: Extended BCG Matrix Grid

Dead

Cocola Instant Noodles has a relative market share of 18% in the instant noodles
market. Since Maggi’s market share is 57%, relative market share is 0.32. Their growth
rate is around 40%. This makes Cocola Instant Noodles a ‘Question Mark’ SBU of Cocola
Food Products Ltd. Since Cocola Instant Noodles has a relatively low market share and a
high growth rate, the company would require spending to increase sales and hence
profit to combat Maggi 2-Minute Instant Noodles by Nestlé.

20%

20
%
10%
0%
10
%
-5%

1
4
6
25
8.3 GE Model

8.3.1 Classification of Business Strengths

Factor Weight Rating Value
Product Quality 0.20 2 0.40
Brand Reputation 0.15 3 0.45
Promotion 0.15 2 0.30
Management 0.15 2 0.30
Width of Distribution Channel 0.10 4 0.40
Efficiency of Distribution Channel 0.10 3 0.30
Market Share 0.10 2 0.20
National Status 0.05 4 0.20
Total 1.00

2.55
Table 6: Classification of Business Strengths

8.3.2 Classification of Market Attractiveness
Factor Weight Rating Value
Niche Market Catering 0.25 3 0.75
Competition 0.25 2 0.50
Market Size 0.15 4 0.60
Sales Promotion Requirements 0.15 3 0.45
Market Growth Rate 0.10 3 0.30
Substitutes 0.05 2 0.10
Perception of Local Made Foods 0.05 2 0.10
Total 1.00

2.80
Table 7: Classification of Market Attractiveness

26

Figure 5: GE Model Grid

Selectivity/
Manage for

We can see that the weighted value Business Strength is 2.55 and that of Market
Attractiveness is 2.80. This puts Cocola Food Products Ltd. in the center of the GE Model.
At this position where both the variables are ‘Medium’, the strategy to be taken is
‘Selectivity/ Manage for Earnings’. Cocola should concentrate on protecting the existing
market of air-dried noodles as it is the more profitable but should focus on gaining
market share in the instant noodles industry to flank marketing.

5.00
Strong
3.67
Medium
2.33
Weak
1.00
Strong
5.00
Business Strength
Medium Weak
3.67 2.33 1.00
Strategy of GE Matrix
27
8.4 Porter’s Five Forces of Competitive Position

8.4.1 New Market Entrants
• Entry Barriers – There are few very well established companies in the market which
are involved in noodles production. So there are a lot of barriers to entry in the noodles
production industry.
• Incumbents’ Resistance- There are two established competitors – Cocola and Maggi. So
a new entrant will face fierce competition from them, and hence it will be harder for the
new entrant to get an established foothold in the market.

8.4.2 Supplier Power
• Brand Reputation- Maggi is well recognized and has a better brand reputation than
Cocola Instant Noodles. So, few suppliers prefer to work with Maggi because they
perceive that having a better brand reputation will mean providing better services and
quality products.

8.4.3 Product/Technology Development
• Alternatives Price/Quality – Maggi and Fu-Wang can be both termed as alternatives.
Maggi is superior in terms of quality, but Fu-Wang and Cocola have more or less the
same quality. The prices of the products are similar.
• Fashion and Trends- There has been changes in food habits of the populace, mostly
those living in urban and semi-urban areas. Previously egg noodles and stick noodles
were more popular. Recently, both due to easy preparation method and sales
promotion, instant noodles is also getting more and more popular.
• Legislative Effects- The products need to be tested and certified by BSTI for quality
and hygiene.

28
8.4.4 Buyer Power
• Buyer Choice- In this case, buyers can choose from Cocola, Maggi, Fu-Wang and
Meridian for instant noodles and also a few of the local homemade brands of stick
noodles.
• Buyers Size/ Number- The number of buyers is quite huge, because a lot of people
are interested in noodles, and the target market is getting bigger and bigger every day.
The companies normally target the people having a fair income and can afford to
purchase snacks.
• Change Cost/ Frequency- There is, in fact, no change cost, because there are a lot of
instant noodles products available in the market. And people can easily switch from
brands. Also, they sometimes switch brands without much of a reason.
• Product/ Service Importance- Noodles is more or less important as snacks item,
because it is fairly cheap and easy to cook and is also liked by most of the people in
general.

8.4.5 Competitive Rivalry
• Number and Size of Firms – Major competitors like Maggi and Fu-Wang are
established firms. Although Meridian is not very popular, Maggi is. Maggi is both very
well known and has a very big market share.
• Industry Size and Trends – The industry itself is substantially big and is showing a
growing trend. Noodles, as a food and snack, is getting more popular among the lower
end of the urban and semi-urban societies.
• Product Ranges- Cocola Stick Noodles itself acts as a competitor for the Cocola
Instant Noodles. In rural areas, Cocola is quite popular, because of its Stick Noodles, but
not because of its Instant Noodles, for which Maggi is popular.

29
8.5 ADL Matrix
INDUSTRY LIFE CYCLE STAGE

COMPETITIVE
POSITION

Figure 6: ADL Matrix Grid

Since the instant noodles industry is in its growth stage and Cocola Instant Noodles has
a tenable competitive position with 18% market share, the company should find a
particular niche for this product and protect it.

8.6 External Environment Analysis (PEST)

8.6.1 Economic Environment
Instant noodles are a growing product and thus price should be competitive to capture
market. The economic factors we find relevant to instant noodles are:
 Global price surge is heating up edible oil market. In 2008, the price was Tk 87-90
per litre1. This year, the price has come down to Tk 60 per liter, which is still high.
Instant noodles contain a cake already baked in oil and thus require no additional
oil.
 More women are availing employment opportunities and working mothers will help
drive the demand for ready-to-cook snacks.

Dominant
Strong
Favorable
Tenable
Weak
Embryoni

Growth Mature Aging
Find niche
and protect it

30
 As Bangladesh is undergoing extensive industrialization, many household maids are
leaving their current jobs and entering the factories for better salary and better
social status leaving homes to be tended by part-time helps or by the families.
 Global recession is causing prices of essential items to go down and making
complimentary snack items more affordable.

8.6.2 Social and Cultural Environment
Social factors will affect customer’s needs and perception of what they want and thus
shape potential market for our product. The social factors we see affecting our product
are:
 There is a trend of both parents working in all social classes leaving the children to
tend for themselves and instant noodles can be cooked by practically anyone who
knows how to boil water.
 Guests who call on and stay for less than one hour is a growing trend as people live
busier lives in the cities.
 Children with both parents working and part-time help is becoming more
widespread, leaving them to arrange lunch and afternoon snacks using the
microwave oven or stove.

8.6.3 Technological Environment
Currently, the technological environment is not directly affecting the demand for instant
noodles. The technology to produce instant noodles is acquired from experts from
Taiwan, Japan and other countries.

8.6.4 Political and Legal Environment
The political environment has been an influence in promoting certain brands for
government offices. Currently, government offices do not demand noodles as they have
their own canteens. Legal side of this product would include complying with the
Bangladesh Standard Testing Institute (BSTI). That would include providing the correct
information on the packaging label about nutritional facts.

31
9 Goals and Objectives
9.1 Usage Goals

9.1.1 Year1 (July 2009- June 2010)
The primary goal of Cocola is to increase its market share in the instant noodles market
in Bangladesh. The product is in its growth stage with annual growth of 40%. At this
stage, Cocola is basically a follower imitating Maggi’s instant noodles in some ways. Its
tastemaker is a mixture between soup flavors with basil leaves and is less spicy
appealing to those with low tolerance for chili. The marketing mix strategies are
discussed in the next section. In the first year, Cocola aims to capture 25% of the market
share from its share of 18% share now.
First, awareness building programs will be undertaken starting from July 2009. This will
include promotion mix strategies. Cocola instant noodles will introduce product
proliferation by providing more variations of tastemakers. The activities for are listed
below:
 Clearing inventory of old CIN packages.
 Taste maker modified rebuy from Malaysian suppliers so that the ingredients have a
better taste. (Currently, they buy Japanese tastemaker from a Singaporean supplier.)
 Packaging from yellow and red to the popular Cocola Stick Noodles packet design

though size will be same as before with a red packet for beef, yellow for spicy,
orange for shrimp and green for chicken.
 Training to agents to have better B2B relationships and retailer relationship.
 Special trade terms modified to reduce commission of agents as we go for a pull
strategy.
 Reinforce brand name and main points of differentiation (Package, Taste) through
promotional mix.
 Test Marketing- A small scale introduction of different flavors to predict the demand
for each flavor of tastemaker. This will provide information needed for production
decisions.
32
9.1.2 Year2 (July 2010- June 2011)
The feedback from last year’s efforts will decide which activities to pursue. The
variations of tastemakers will be evaluated based on the demand for each variation. The
most successful three tastes will be pursued from this year. Also, the response from
other promotional activities will be measured. To constantly be in the minds of
consumers, Cocola will be shown on billboards and it will also be available at all
convenience store around Dhaka.

9.2 Marketing Objectives
In order to reach the usage goals, Cocola has to achieve the following marketing
objectives:

 CIN must have achieved product awareness in Bangladesh
 CIN must be available in all the convenience stores around the major cities of
Bangladesh
 CIN will capture a market share of more than 25% by June 2010
 CIN must be a part of every general purpose Cocola Foods Ltd. distribution
In terms of product acceptance curve, CIN users are innovators or absent from the
curve. Awareness is very low. To meet its overall sales target, CIN needs to break
through to majority of its users by the end of Year1.

33
10 Marketing Strategies
10.1 Positioning

10.1.1 Perception of Cocola Instant Noodles
Many consumers in urban and the rural areas are unaware of the existence of Cocola
Instant Noodles. That is mostly because of Cocola’s lack of promotion of instant noodles
and also because of the fact that competitors like Maggi and Fu-Wang occupy a concrete
position in the consumers mind. Few of the consumers who are aware of the existence
of the product mostly refer to it as a copier of Maggi. So, Cocola Instant Noodles does not
have any proper or unique positioning in the market. However, Cocola Stick Noodles is
very popular in the air-dried noodles market. Cocola Food Products has other popular
products like candy, biscuits and such. Most think of Cocola stick noodles when they are
asked to describe Cocola.

10.1.2 Perception of Competitors
10.1.2.1 Maggi
Maggi 2-Minute Instant Noodles is perceived as a tasty, healthy and nutritious product
by most of the consumers. In fact, the major percentage of noodles consumers prefers
Maggi over any other brand. Maggi has unique positioning in terms of taste and
nutrition, and also they are popular in the minds of their consumers, mostly the
children.
10.1.2.2 Fu-Wang
Fu-Wang Instant Noodles has a somewhat different and also unique perception among a
different set of consumers. They target the family as a whole. They are positioned as
economy and good taste. People perceive Fu-Wang as economic because they offer
family packets containing 10 noodles cakes at a price which is cheaper than the same
quantity of any other noodles brands. Also, a lot of consumers perceive Fu-Wang to have
a different taste compared to others.

34
10.1.3 Positioning of Cocola Instant Noodles through Differentiation
The previous sections show the existing positioning of Cocola Instant Noodles and its
competitors Maggi and Fu-Wang. This section is based on developing a new and better
positioning for the Cocola Instant Noodles. For a product to be successful in a
competitive market, it needs to have a proper position in the minds of the customer. The
product must occupy a position that is different from its competitors and it should be
unique and simple. And for a product’s position to be unique, it needs to be different
from its competitors’ products.
For the Cocola Instant Noodles, we have used Product Differentiation. The instant
noodles will be different from other companies’ instant noodles in terms of taste. As was
shown earlier, the existing flavors of Cocola are Chicken and Masala, and those of Maggi
are Curry and Masala. So in terms of flavors, both of the companies have similar
products. Here, we propose to introduce new flavors of the Cocola Instant Noodles.
These new flavors are not available in either the Maggi or the Fu-Wang Instant Noodles.
Also it has been noted that the perceived difference between the tastes of the two
flavors for the Maggi Instant Noodles are not that much. But this will be different for
Cocola Instant Noodles. The new product will come with four flavors of taste-makers –
Beef, Shrimp, Chicken and Spicy, and these flavors will add unique tastes to the noodles
which will be quite different from each other.
Since the new Cocola Instant Noodles will have more flavors than the other instant
noodles of the other companies, so the positioning for Cocola will be very simple and
straightforward – Variety. They portray themselves in the mind of the customers as the
instant noodles having a variety of tastes to choose from.
10.1.3.1 Positioning Strategies Based on Product Life Cycle (PLC)
The product life cycle shows the stages through which a product evolves from the time
when it was introduced into the market. The four stages of product life cycle are:
Introduction, Growth, Maturity and Decline. The following diagram shows theses stages
of PLC.

35
From analysis and data collection, it has been concluded that Cocola Instant Noodles has
crossed the introduction stage and is now at the growth stage. The positioning
strategies for the Cocola Instant Noodles based on the growth stage are given below:

 The new version of Cocola Instant Noodles will have four distinct types of
tastemakers. This will increase the variety of the product in terms of flavors and
taste.
 Previously the target market was limited to the people living in urban areas. The
same targeting was also used by Maggi. Now the target market will be extended
to both urban and semi-urban people, utilizing the good distribution network
that Cocola has.
 Although the distribution channel is pretty widespread, it has been found out
there is much inefficiency in the channels which leads to a significant loss in
sales. For this reason the distribution channels’ structure will be improved and
the efficiency of the distribution channel will be enhanced.
 Many people, both urban and semi-urban areas are not aware of the existence of
Cocola Instant Noodles. So promotion campaigns will be directed to increase the
awareness of the product as well as slowly building preference for the product to
those people who were aware of the product.
10.2 Marketing Mix

10.2.1 Product
Cocola Instant Noodles can be classified as a non-durable consumer shopping good. The
noodles are consumed up in one use and it is mostly bought by the single consumers for
making noodles in homes. The product is mostly B2C (business to customer), and
although B2B (business to business) prospect exists, a sector that has not yet been fully
utilized. This B2B sector targeting has been the focus of the niche market section. Since
the product is a shopping good, quality, price, packaging, variety and brand awareness
plays a very important role in the purchasing decision of the consumers.

36
10.2.1.1 Differentiation
For creating a unique proposition in the mind of the customer and also to create a brand
and a unique positioning, a product has to be different from its competitors’. From the
above classification, it can be seen that buyers make their purchasing decisions related
to noodles based on price, packaging, quality, variety and brand awareness. So to have a
unique positioning the Cocola Instant Noodles has to be differentiated along the above
categories.
In the positioning section, it has been mentioned that for Cocola, Product Differentiation
on the basis features will be used. The core product – noodles cake – is the identical for
all the players. They are manufactured in the same way and they have almost same size,
shape and taste. So, in the case of the core product, it is hard to differentiate. The
differentiation must be done in terms of the flavors. As was mentioned earlier, all
instant noodles packs come with a taste-maker which adds flavor to the core product.
This feature of the product will be used to differentiate Cocola Instant Noodles from
those of Maggi and Fu-Wang.
In the existing market Maggi Instant Noodles comes with the flavors Curry and Masala
and Fu-Wang Noodles with Beef and Chicken. Cocola Instant Noodles has two flavors –
Chicken and Masala – imitating Maggi. We will add three more distinctly different
flavors to add to the depth of the product mix. These flavors are Chicken, Spicy, Beef and
Shrimp. Specifically these four flavors have been chosen because they have never been
used by any of the instant noodles companies simultaneously. Also, the consumer
surveys have shown the preference of the consumers for these flavors. In addition to
these two flavors, the flavor Masala will renamed as Spicy so as to differentiate from
Maggi. Having these two flavors will differentiate Cocola from the other companies, and
will also emphasize on its positioning – which is Variety.

10.2.1.2 The Product Line Decisions
The product mix of Cocola Food Products contains various products ranging from
beverages, biscuits to candies, wafers and many other consumer products. Even in the
case of noodles they have two product lines – air-dried noodles and the instant noodles.
For this marketing plan we have chosen the instant noodles product line.

37
Product line depth – As mentioned before, Cocola Instant Noodles comes in two
different flavors having two different taste-makers. This product line depth will be
increased by the addition of three new flavors – Chicken, Spicy, Beef and Shrimp.
Product line length – So far, Cocola Instant Noodles is sold as single sized packets
containing one noodles cake and one packet of taste-maker. Maggi also comes with the
same sized packets, but Fu-Wang has four different sized packs, having four, eight and
ten cakes and a single pack having one noodles cake. These multi-packs helped Fu-Wang
to offer the product at a lower average price per noodles cake and helped to build the
economical image for the Fu-Wang Noodles. And in the multi-pack segment (especially
the eight and ten packs) of the market, Fu-Wang is virtually unchallenged. So as to
increase the sales of Cocola Instant Noodles, the product line will be extended by the
introduction of a family pack having five noodles cakes. This family pack will be
available in all four flavors and offered at a price of Tk. 55. At this price, the average
price per noodles cake will be Tk. 11, compared to the price of a single packet which is
currently priced at Tk. 12, thus offering the consumer a considerable amount of savings.
Cocola can thus compete with Fu-Wang’s Family pack because both have cost of Tk.11
per cake and Cocola has a lead in terms of smaller quantity (5 packs) which makes it
more viable. Also, the price of single units would be increased to Tk. 13 so that it
competes with Maggi in terms of variety and weight not price competition.

10.2.1.3 Packaging and Labeling
For the Cocola Instant Noodles, changes in the packaging will play a very important role
in building up the brand awareness for the product. The present packaging is similar to
that of Maggi. The background color of the packet is yellow, with the name of the
company placed in a red portion and the name of the product and the flavor in a
separate section in blue. In the package, there is also the picture of a bowl of noodles.
Together, the pack of Cocola Instant Noodles looks very much like the pack of Maggi
Instant Noodles, and in fact the packages lacking in finishing, which makes an early
negative impact on the minds of the buyer. The packaging material used is somewhat
thicker than the material used for both Maggi and Fu-Wang, and this increases the perunit
cost
for
the
product.
The
packaging
of
the
tastemaker
is
somewhat
faulty

38
describing the tastemaker as a soup. The net weight label (65g+/-3g) on the packaging
of the Cocola Instant Noodles is not in the proper position and it is rather misleading.
The new packaging will be completely different from the existing packaging. From
surveys and analysis it was seen than in many cases people identify the Cocola brand
with the Cocola Egg Noodles, which, has been the most popular product for Cocola. The
existing packaging resembling Maggi makes the Cocola Instant Noodles look like
imitators of Maggi. So as to create the brand preference for Cocola and to differentiate
Cocola Instant noodles from Maggi Instant Noodles, the packaging theme for the Cocola
Egg Noodles will be used. There will be a transparent portion of the packet resembling
the Egg Noodles pack, and name of the brand and the name product will be located in
the places resembling that of the air-dried noodles pack. In addition, different colors for
different flavors will be used: Yellow for Spicy, Red for Beef, Green for Chicken, and
Orange for Shrimp. The material used for the packaging will be of lesser thickness so as
to cut off costs. The thickness level will be similar to those of Maggi and Fu-Wang. And
the labeling of the package will also be changed to match the labeling of the egg noodles
packet, and the taste-maker’s label will be changed to match the description of the
flavor. This same theme will be used for the five noodles cake family pack.

Figure 7: Packaging of Cocola Stick Noodles

39

Beef Chicken Shrimp Spicy
Figure 8: New Packaging for 4 Varieties of Cocola Instant Noodles

The use of the same theme for the successful Cocola Egg Noodles will help in the
building of awareness of the Cocola Instant Noodles. This packaging scheme will also
help to create packets of the instant noodles which are identified as the “Cocola Brand”,
different from other brands. And the different colors for different flavors will help to
stress further the positioning of the product in the minds of the customer as brand of
instant noodles which offers a lot of variety in its flavors.

10.2.2 Price
10.2.2.1 The Current Price
 Pricing Objective: Maximum market share by Market Penetration Pricing
 Analyzing competitors’ prices
• Maggi- Single: 62g @ Tk 13, Family: 62gx4 @ Tk. 52
• Fu-Wang- Family: 70gx10 @ Tk 110
 Current Pricing method: Going-rate pricing
 Final price: CIN- Single: 65g (+/-)3g @ Tk. 12, Bundle: [65g (+/-)3g]x3 @ Tk. 36
10.2.2.2 Pricing Strategy
Improve quality of product to maximize market share. Recommended pricing:
Single unit: 65g (+/-) 3g @ Tk. 13, Bundle: [65g (+/-) 3g] x5 @ Tk. 55
40

Also value-added pricing should be opted instead of going-rate pricing. Initially,
customers must feel that Cocola is giving the same value as Maggi. Price is still the
largest determinant of quality to most customers.

10.2.3 Place
As mentioned in the distribution, the distribution channel of Cocola Food Products Ltd.
is very widely spread. It is in fact one of the major strengths of the company, not to
mention Cocola Instant Noodles (CIN). However, all of the products of the company are
similar in the sense that they are food products or beverages. This would particularly
enhance the synergy of the distribution network of CIN.
Cocola Food Products Ltd. follows indirect marketing channel comprising major
distributors throughout the nation. These distributors employ sales representatives to
sell to the retail stores who ultimately sell to the final consumers.
10.2.3.1 Placement Strategies
 Focus on B2B market segment, an untapped market, by going direct. This would
result in Blue Ocean since no company has focused on the B2B prospects of the
instant noodles industry.
 Focus on multi-channel distribution. Although Fu-Wang has multi-channel
distribution network, Cocola has not developed one yet. Cocola should go for
multi-channel (comprising one-level and two-level channels) distribution
techniques. The large-scale retailers would be catered separately.
 Revise rate commission to distributors. Cocola currently provides 7-8%
commission on sales to distributors, compared to 5% by competitors. Since a pull
and push strategy would be undertaken the rate should be made parallel to the
competitors. However, other forms of incentive may be provided.
 Cut down or combine distributors. In cases where there are territorial overlaps,
distributors may be combined and if necessary be cut down. Also, some of the
important distributors may be vertically integrated by the company.
 Adopt intensive distribution. Because Cocola is not following intensive
distribution, Cocola instant noodles are not available in shops. It should adopt
intensive distribution, which would likely lead to greater shelf space.
41

 Improve logistics. Inventory management may be improved by setting up
advanced integrated inventory management network. This would enable Cocola
to go for JIT marketing. Also, the distributors may be convinced to place
advertisements of CIN on their vehicles, an example of partnership building.
10.2.4 Promotion/Communication Strategy
An effective communication strategy can be developed using eight steps. They are:
Figure 9: Steps in Developing Effective Communications

42
10.2.4.1 Identifying the Target Audience
The process must start with identifying a clear target audience in mind: potential
buyers of the company’s products, current users, deciders, or influencers, individuals,
groups, particular publics, or the general public.
The main target audience for Cocola Instant Noodles should be children (7-12 years)
and mothers.

10.2.4.2 Determining the Objectives
Figure 10: Buyer Readiness Stages

Based on the buyer readiness stages it can be said that a large part of the target
audience for CIN are in the awareness stage. They do know about Cocola Egg (Stick)
Noodles but they do not know that Cocola also has instant noodles. They have to be
made aware of the product.
Many target audience are in the knowledge stage who know about the product but
would rather buy Maggi or Fu-Wang. They need to be attracted in such a way that they
will eventually like the product and purchase it.

10.2.4.3 Designing the Message
CIN has to make sure that it delivers the same message for all the channels of
communication. The message should contain the following facts:

 CIN is healthy and easy to prepare
 CIN is tasty and the comes in 4 different flavors
 CIN is economic
The brand ambassador should be Bipasha Hayat with whom the new generation of
mothers will connect.
43

10.2.4.4 Selecting Communication Channels
Personal communication channel e.g. face-to-face communication by the company’s
sales force should be used for business customers like fast food shops, restaurants,
canteens and cafeterias. To reach household consumers non personal channels should
be used.

10.2.4.5 Setting Total Promotion Budget
Being a local company, Cocola Food Products Ltd. is reluctant to spend money on
promotion. But in order to achieve the promotional goals, the company has to spend
money. The objective-and-task method would be most logical here.

10.2.4.6 Deciding on Promotion Mix:
o Above the Line (ATL): Promotional activities carried out through mass media, such
as television, radio and newspaper, are classed as above the line promotion. These
types of advertising are costly. But since building brand awareness is one of the
major promotion objectives in case CIN, ATL promotion cannot be neglected.

Forms of ATL Promotion to be Used:
i) TV Advertisements
ii) Print Advertisements (newspaper, magazines)
o Below the Line (BTL): Below the line sales promotions are short-term incentives,
largely aimed at consumers. With the increasing pressure on the marketing team to
achieve communication objectives more efficiently in a limited budget, there has
been a need to find out more effective and cost efficient ways to communicate with
the target markets. This has led to a shift from the regular media based advertising.
BTL techniques ensure recall of the brand while at the same time highlighting the
features of the product.
Since the main competitor of Maggi has already captured the mind share and to a large
extent the heart share of the consumers, CIN should focus more on BTL rather than ATL.
44
Maggi has a big advantage which is the advertisements on Indian channels. They have
played a huge role in capturing the mind of the people. CIN cannot spend so much
money on ATL promotion and go on direct competition with Maggi.

Forms of BTL Promotion to be used:
i) Free Sampling in district level schools and amusement parks
ii) Gift with Purchases: Paper toy with 2 single packets & tiffin box with (5+5)
10 packets
iii) Trade discount to retailers & business customers
iv) At Point of Purchase: Danglers, posters, separate CIN shelf at superstores
(e.g. Agora, Nandan etc) with trained shelf talkers.
v) Provide discount coupons with flyers in district level schools and
amusement parks to induce trial

10.2.4.7 Measuring Results
After implementing the promotion plan, the impact on the target audience has to be
measured not in terms of increased sales volume and revenues only but also how it has
helped the customers to make a purchase decision. The target audience has to be asked
whether they recognize or recall the message, how many times they saw it, what points
they recall, how they felt about the message, and their previous and current attitude
towards the product. CIN does not need to hire a big research organization like Nielsen
for this. They can start small by using their sales force and agents to ask the retailers
and customers at point of purchase.

10.2.4.8 Managing Integrated Marketing Communications (IMC)
To implement an effective IMC different channels of communication have to be well
coordinated. The message they convey should be the same and their purpose should be
in the same line. It should be made as much cost effective as possible.

45
10.2.5 People
Cocola Food Products Limited has a huge distribution channel which it can utilize to
gain an advantage over its competitors. Cocola can benefit by each of the following
propositions:

10.2.5.1 Training distributors/Sales representatives
In order to create a good image for itself, Cocola must have good sales representatives
who will be more efficient and delicate in selling its products. They will be trained more
on how to properly market the products to different types of retailers along with facing
different behavioral patterns from them. This will enhance the number of sales to retail
shops.

10.2.5.2 Building relationships with individual large- scale retailers and B2B sales
divisions
At the end of the day, Cocola will not go door to door and sell their product but will
rather depend on these people for serving that purpose. Building relationships with
individual large-scale retailers and B2B sales divisions will ultimately result in a
situation where these retailers and sales people will in fact recommend to their
customers to buy Cocola products which will act as an advertising medium and will help
spread word of mouth.

10.2.5.3 Providing incentives to motivate sales representatives and retailers
CFPL gives its sales representatives more commission than its competitors do.
However, Cocola can try to persuade an increase in sales if some kind of bonus was paid
to its sales representatives or the retailers who sell Cocola products on the basis of the
number of packets of noodles sold in a given time period.

46
10.2.6 Process
Process consists of the customer experience creating activities. People can buy noodles
from any of the distribution channels through which the product is being supplied. In
the supermarkets they receive no supervision and thus there is limited scope for
creating experience.
However, there are two specific promotion campaigns and one Below the Line (BTL)
labeling strategy to address this. Also, there other strategies which are meant to make
the process of consuming noodles enjoyable.

10.2.6.1 Process Strategies
 Prospect of promotion tools such as toys can create a fun experience for children

who are our target market. They will cherish these toys for as long as they last
and this is a short term plan. So we must provide long-lasting toys which will
remind them how much fun it is to eat noodles.
 Adults will be attracted to the bowls which will be given as a promotion tool
after the first promotion is over. Whenever consumer households will use these
bowls, CIN will be reinforced in their minds.
 In each pack of noodles, there will be a sentence on how much fun it is to eat
noodles while watching the television.
 Cocola will open a monthly subscription program so that people can order on a
monthly basis, 30-40 packs of instant noodles at a lower than market price rate.
This strategy is likely to be copied by other noodles makers. So, to make sure
people understand Cocola started this, the package will claim this offer.
 A strategic partnership will be formed with the major mobile operators so that
customers can place order conveniently. Also, the delivery will be carried out
using Cocola’s extensive delivery network.
 Increase efficiency of distribution channel by improving relationship with
partners and providing relevant training where necessary
 To enhance the experience customers have with CIN, the product will be made
available at all major convenience stores and places where demand will be
created must be followed with presence of the product within 2 days.

 All general distributions will carry the product. Cocola’s distribution network is extensive enough to cover most of the points of purchase used by consumers.
 The three months after re-launch will be crucial to determine the total demand generated by each product variant. Then, the production can be carried out on large scale. This will optimize the costs for the company and also produce satisfied consumers.
 Other measures include customer satisfaction survey which will serve a dual purpose. Not only can we identify which wants we are not meeting but it will also help create more awareness of the brand among innovators and early adopters. This will help create top of the mind share of instant noodles consumers.

10.2.7 Physical Evidence
Physical evidence is the proof that the product is delivering what it promised. There are two parts of the instant noodles: the cake and the tastemaker. Cake: The cake is a standardized part of the product. Though CIN’s cake is the hardest among the top three in this market followed by Fu-Wang and Maggi as the softest, it does not change the perception of consumers by much. Fu-Wang is a three-minute noodles and it has thicker cake strands than Maggi’s. On the other hand, Cocola has the thickest strands. These differences have been tested using conjoint analysis. Tastemaker: As the instant noodles will be consumed, consumers will be able to taste
the difference between each flavor offered by CIN and other companies. The main challenge for Cocola will be to convince target group that each taste is different and unique. Also, making the scent appealing would be crucial. Cocola’s promise to its customer is to produce healthy, hygienic food. It will be easy to establish the hygiene factor as the cake looks very clean with a uniform texture.
Surprisingly, most people in Bangladesh are not very concerned with hygiene of the food. However, consumers take it for granted that the products are safe. Instead of focusing on what Maggi says about its product, that Maggi helps in building muscles, and claiming the same, Cocola should give concrete facts. Most consumers do not think of health when they consume noodles. Most eat it because it has carbohydrate so protein is not a very strong point to convince consumers about the nutrition of noodles.

10.2.7.1 Physical Evidence Strategies
• Meet the expectations of the consumers and give them a delight by using promotional tools from time to time

• Provide all the flavors that has been promised
• Make the claims believable and important by telling consumers about the daily
carbohydrate need that one packet of Cocola meets and focus on why carbohydrate is needed
• Portray eating noodles as a fun activity by using ATL and BTL

11 Controls
11.1 Marketing Research
11.1.1 Surveys
The consumer survey revealed the following observations related to preferences and factors of the Cocola Instant Noodles and the instant noodles industry:

• Most of the people surveyed were aware of the existence of the Cocola Instant Noodles
• But nearly all of the consumers prefer Maggi Instant Noodles. After Maggi comes the position of Cocola and finally the least preferred are the Fu-Wang. It has also been found that few of the people are not actually interested in any of these brands, they prefer foreign brands.
• People purchasing instant noodles mostly look for taste and quality, followed by preparation time, quantity of noodles in a packet  and brand preferences. The next factor comes is price. Fineness of the cake and quality of packaging are the least important factor.
• About the consumption of instant noodle, four to eight packets per month is the average.
• Most of the people surveyed relate the color yellow with noodles, although the reason behind is that Maggi’s packaging is yellow and Maggi is the most well known instant noodles brand in the market.
• When asked to rank the flavors, the consumers ranked chicken as number one flavor, followed by curry, spicy and beef. The last to be ranked were the shrimp and vegetable.
• Most of the people surveyed obtained idea about the noodles brands from the television and radio advertisements. Also a few people learned about the brands from shelves of supermarkets and printed advertisements. Also a small section of people have come to know the brands through free sampling. • Instant noodles are mainly served as snacks for afternoon or evening. Also it is used as ‘tiffin’ packages for children t school and as refreshments for guests.

• Half of the people surveyed buy instant noodles from retail stores and the other half buy it from supermarkets.

11.1.2 Test Marketing

The sales volume of Cocola per year is 750+ tons. The amount to be produced for test marketing will be around 30 tons of that, since the duration of the test marketing will be conducted for two weeks. Around 30000 (10 out of 175 distributors) units of the new CIN would be manufactured. These would be fed to school children in district schools and leaflets showing the new CIN package and a
coupon to buy noodles at a discount will be provided. A conjoint survey will be carried out. In supermarkets in Uttara and Dhanmondi, shoppers will be fed the new flavor and given the leaflet without the coupon. This will provide the needed feedback on how much of each variant to manufacture.
11.2 Action Programs
The product will be re-launched with a new taste maker. The positioning message will be made clearer through push strategies initially and aim at capturing the soul share. By providing quality hygienic noodles, CIN will try to gain 25% of the market share up from the current market share of 18% in the next one year. The entire project is flexible and thus test marketing has been prepared which initial survey of people show that they will go back to Cocola if the taste was good.
1. Taste maker modified re-buy from Malaysian suppliers so that the ingredients have a better taste. (They had tried with Taiwanese taste maker before.)
2. Packaging from yellow and red to the popular Cocola Stick Noodles packet design though size will be same as before.
3. Clearing inventory of old CIN packages.
4. Training to agents to have better B2B relationships and retailer relationship.
5. Carry out test marketing.
6. Special trade terms modified to reduce commission of agents as we go for a pull strategy.

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