In the globalize world, technology and computers have replaced human beings from various roles. In most of the cases the outcome has been quite revolutionary increasing the efficiency and saving time. However there are roles, which have not been replaced by technology yet and the possibility of being so seems quite slim. As ACME is one of the leading companies in Bangladesh they always try to improve its product basket. In this way ACME is trying to introduce a new variant called ACME Mustard Oil. In this industry Radhuni is the main competitor. Among them ACI pure, Rupchanda is also there. We have tried to identify Acme’s opportunity and make a media plan to make the brand successful.
Background of the Report:
This report was prepared following the course instructor Md. Wahidur Rahman’s instructions on the 20th of June, 2009. The report will cover all the relevant information and topics taught in the class, which are necessary to develop an effective report on the Mustard oil Industries in Bangladesh. This report will be regarded as the research paper for the course internship for fall 2009.
Statement of Purpose:
This report will serve the following purposes:
Providing general idea about the mustard oil industry of Bangladesh Identifying the importance of mustard oil industries Developing a set of desired traits necessary for successful marketing plan.
This report has been developed using both primary and secondary data collected from the related people including existing vendors, service providers, marketing experts and most importantly the sales force members. The internet was widely accessed to find vital data regarding the current trends and the organizational data. In addition to that, several magazines and journals were used to get detailed idea about this industry. Most of the data used in this report regarding the company policies and management practices were collected from the employees of “The ACME Agrovet & Beverage Ltd.” at the corporate headquarters.
While preparing the report the following factors posed some limitations, in absence of which the report would have been much more detailed and a better one:
Lack of available data
The topic of the report being a vast one
The topic of the report involving multidimensional factors other than pure business related factors
The industry being a high involving one from the seller’s perspective
The industry involving both goods and services
The report being prepared in relatively short time
Lack of detailed, to-the-point information about operations from the organization
Since 1954, The ACME Laboratories Ltd. has been doing their operation in Bangladesh and today, it is one of the most successful business conglomerates having sister concerns and investments in various sectors in lot other areas in Bangladesh.
ACME refers the “the apex” or the “highest point”. Health vigor and happiness is the philosophy of the ACME Laboratories. Its endeavor is to produce, distribute best quality drugs for the society and maintain the quality of the product in every steps of production. it also accelerates its activities for materializing the WHO ( world health organization) ensuring health for all with in 2015.
ACME Group is one of the leading and diversified global conglomerates in Bangladesh, with offices in all major cities, employing over 3000+ employees and dedicated to bringing the highest quality products and services to our customers. ACME continuously seeks to expand its production facilities, add employees and increase its sales and marketing efforts. According to the latest statistics, out of about 300 pharmaceutical companies in the country, The ACME Labs is one of the top four.
The ACME Laboratories Ltd, the pharmaceutical major and the flagship Company of the ACME Group, is a Manufacturer and Global exporter of Human, Herbal and Veterinary Pharmaceutical products. Our comprehensive Product List ranges from Antibiotics to Histamines to Vitamins.
Historical Achievement of The ACME Laboratories Ltd.
ACME is one of the leading pharmaceuticals company in Bangladesh. The top most pharmaceuticals company that has large contribution in the society and controls the drug market possessing huge market share in Bangladesh ACME is one of those. Late Md. Hamidur Rahaman is the founder of the ACME Laboratories.
1954- ACME Laboratories established as a proprietorship for manufacturing Pharmaceutical items.
1976- ACME Laboratories converted into a private limited company.
1978- Introduces to produce Tablet and Capsule in new premises.
1983 – Commercial operation with modern facility at Dhamrai, 6 acres land 32 km from Dhaka.
1987-cCream and ointment added in production.
1990-Achieve average 25% growth rate compared to the 13% registered by pharmaceutical sectors.
1992- Introduce inject able products.
1997- Agro vet Division of manufacturing of veterinary and animal health care drugs in independent factory.
About the Founders
Establishment of ACME was a great entrepreneurial effort of Late Hamidur Rahman Sinha way back in 1954 and is a vivid example of a great mind’s vision and its materialization. Post colonial Bengal was a place of great uncertainty and hardship. Industrialization facilities were meager and inadequate. One man came forward with his vision, amidst the political turmoil and utter lethargy of the then-new Government. It’s not an easy task to set up a highly sophisticated industry, and moreover do it without bank loans and governmental assistance. So it demanded immense effort, strong determination along with vision and dreams.
1954 was a milestone year in the history of the pharmaceutical industry. Late Hamidur Rahman Sinha might have thought it was a private entrepreneurial effort on his part, but in reality it was a resolute and brave footstep which played a part in pioneering the present pharmaceutical industry.
At the precise moment when this visionary man established the company at Narayangonj, though on a small scale, he had actually sown the seeds of today’s burgeoning almost self-sufficient pharmaceutical industry. Now Bangladesh is exporting drugs to different countries of the world. Had Late Hamidur Rahman Sinha not taken such a courageous step, perhaps it would not have been possible for us to reach such heights of success.
It has been said that behind every successful man is a woman supporting and sustaining his efforts. We also remember his beloved wife, Mrs. Noorjahan Sinha, whose sacrifice, and unconditional support was always a source of inspiration to this visionary man.
As we celebrate ACME’s 50th anniversary they are no longer with us, but their memories will forever remain in our hearts. At this auspicious moment, we pay our homage to them.
Our holistic approach is to ensure Health, Vigor and Happiness for all by manufacturing ethical drugs and medicines of the highest quality at affordable prices and reaching out even to the remotest areas by proper distribution network. We view ourselves as partners with doctors, our customers, our employees and our environment. At present, Globalization is our top corporate priority.
Our Vision is to reach out even to the remotest areas of Bangladesh and improve lives with quality products at an affordable price.
The ACME Agrovet and Beverages Ltd. started its venture in 2005 with orange and mango juice. Then it introduced drinking mineral water. Latest of their product is ACME Premium Gold Tea. It has established a modernized plan in Bangladesh located at Hemayetpur. The plant is equipped with modernized technological facilities and run by qualified personnel in accordance with the stringent guideline of BSTI.
ACME Premium and Classic Mango and Orange Juice
The juice products are packed with the unique Tetra Pak technology. It ensures longer shelf life, No deterioration during shelf life and free of preservative related side effects.
To ensure quality of product, ACME does the procurement from the best source available. The company emphasizes to the greatest extent on the quality of raw materials.
The raw materials of Mango juice are imported from India and Pakistan. These are continental mangoes of the best quality.
For Orange Juice, concentrated orange pulp is procured from the best places of Brazil, produced by blending a pool of selected fresh oranges.
ACME mango and orange juices are differentiated due to their unique taste and flavor. Being nutritionally rich and free of noxious preservatives, they are available in 150 ml, 250 ml and 1000ml hygienic UHT packs.
The range of this product is 150 ml Classic orange and mango juice, 250 ml Premium and Classic orange and mango juice, and 1000ml Premium and Classic Orange and Mango juice, and also 1000ml Classic Mangorange juice.
The target consumers are 5 years to 12 years popular segment for 150 ml. This brand is personified with Fun Loving, Friendly and Smart. The core value is the taste that gives refreshing energy.
For 250 ml, 6 years to 25 years segment is targeted. It is in the list of regular go out menu that makes consumers feel good.
1000ml targets the families in both urban and suburban premium and popular segment, marketed as regular family drink for 26 years to 40 years segment.
In general, the product is mainly retail focused, that relies on differentiation strategy with Quality being the core competency. The product is going through growth stage with Shezan being the market leader with differentiation strategy, Danish with focus strategy and Pran following cost leadership strategy.
Premium Drinking Water: A Brief Profile
ACME premium drinking water symbolizes Purity. As per guideline and standard set by BSTI, it is bottled in environment friendly PET bottle. It contains proper mineral balance and is for all age groups. It is available in 1500ml, 1000ml and 500ml.
This product is less retail focus with Hotels, Restaurants and Cafeterias being the primary outlets. Corporate offices and institutions are mainly the target segment. It is a popular segmented product suitable for all ages. This product also follows differentiation strategy with Purity and Quality being the main core competencies. Mum being the market leader with Focus and Differentiation strategy, with purity, segmentation, availability and being different in branding.
The water treatment process includes reverse osmosis with 20 stages of filtration process, Ozone and Ultraviolet Ray Treatment before the water is bottled.
ACME Premium Gold Tea: A Brief Profile
Tea is the latest of the products in The ACME Agrovet and Beverages Ltd. It is available in 10g, 50g, 100g, 200g and 400g pack sizes. The product is launched as a premium product and marketed as Raw Tea. This product follows Focus Strategy mainly focusing urban and suburban premium customers. It targets the retail outlets. It is in its embryonic stage with the product being launched with few difficulties and going through a sustainability period. Ispahani and Lipton are the market leaders with high availability and differentiation through promotion and branding. Tetley and HRC are controlling a substantial amount of the market and sustainability is difficult if this product do not change its strategy.
ACME Chilli, Coriander, Turmeric and Cumin powders
The Packing material is washed from nitrogen solution that no chance of quality hamper is there. The raw material is collected from the local market specially from the north Bengal.
ACME Spice has the essence of the actual spice’s pungent taste and aroma, required in small quantity and makes food simply marvelous. So bring home a pack of ACME Chilli, coriander, Turmeric or Cumin powders.
- The ACME Agrovet and Beverage Ltd have got the investment backing of The ACME group. The goodwill of the Pharmaceutical business and also the marketing channels and distribution resources are being used as far as possible.
- The experience, Office premises, Management and manufacture of the ACME group is a huge advantage for The ACME Agrovet and Beverage Ltd.
- The Quality of the products of The ACME Agrovet and Beverages Ltd. is better than most of the local FMCG companies. Comparing the quality, the prices of the products are within the range of the target segment.
- ACME group is doing business for more than 50 years. Therefore, this may result in traditional thinking in the top management level. Their experience is rooted by pharmaceuticals which is a totally different product from FMCG. Even the other departments in the group which are providing services to the Agrovet sector, have to understand the dimensions of Agrovet in order to provide the standard of Agrovet that it needs.
- May be for poor salary structure or weak corporate culture, the employee turnover rate is increasing in the whole ACME group. This is also affecting the Agrovet sector. The employees lack motivation and productivity among themselves.
- At present, there is no specialist Research and Development team in the Agrovet. It has become a barrier in effective and efficient market research, new product development, corporate strategic planning etc.
- This FMCG market needs lot of promotional communication in the market. It is an expense for the management. Not only ACME group, every management should understand how brand triggers sales and they should respond accordingly. This has been the problem of the local companies where they are falling back of the MNCs like Unilever who are doing it better.
- The Agrovet is fully dependent on either the import or local buying of raw materials depending on the product. We do not have our production facilities.
- Due to difference in the business ways, Agrovet is facing poor coordination among chain management from all other departments. Any support Agrovet needs from the other departments, they are not been able to deliver properly because they are trained for printing press, pharmacy, IT and other departments, Agrovet needs specialists.
- In order to maintain the product quality, Agrovet lacks competitive pricing and pricing experimentation.
Currently, the government is giving priority in expanding and promoting local agro-based business in the country. This is a huge advantage to any Agrovet business. The bank loans regarding the Agrovet industry has decreased due to government intercept to encourage the business.
The society is changing. People are becoming very conscious about what they are consuming. This is a good prospect for beverage industry. Now-a-days, people lack interest in drinks like Coke, Pepsi and are more inclined towards having juice, tea and when they are outside, having mineral water. May be now the rate is very low, but it is increasing. It shows the prospect for FMCG products.
The number of dual income families is increasing at an alarming rate. The lifestyle of people is becoming faster and this leaves them with minimum time to cook. Therefore, it is a huge opportunity for spices market.
Our country is rich with natural fruits and productive land. This can be used as a source of our raw materials needed for the manufacturing of ACME products. We can build ways to production in our own country.
Globalization is a major factor for us to increase our market scope in the international arena. For Globalization, it is much easier now to enter foreign market and increase our exports to earn higher margin. It would also enable us to set up our office premises and our manufacturing plant elsewhere where it would be sustainable for us to create an MNC.
In our country, the supporting industries are also growing at a faster rate. There is more number of local TV channels going international, new competition in the advertising, market tension, and other factors as well. These things would help us in our reach to our customers and also in other part of our business, for example, more number of TV channels and newspapers would mean more promotional activities and decreasing advertising cost.
- Globalization can also backfire. There are many corporate giants which are trying to enter our market. Being a third world country, our country is a market place for everything. Terrorists, smuggling, counterfeiting, product dumping and many other things. First world countries use our country by exerting pressure on our governments to sell their low graded products in our country. These products take away the market from our local products. But generally they are very low in quality.
- With increasing technology, our country being high in corruption, use those technologies in order to make fake products under different brand names. ACI, ACME and Coke are victims of such fraudulent activities. These technologies help these people to make similar kind of product packages and sell them by using the reputation and goodwill of those products.
- The ACME Agrovet and Beverage Ltd is a sister concern of The ACME Laboratories Ltd. Therefore, the goodwill and reputation of the products and services is like a chain that is binding all of them. If there is any problem with the reputation and quality of any one sister concern, the effect would be on all of them. So all the concerns have to maintain the same standard.
- The current corporate giants are the biggest threats not only in terms of competition but also in ways of how they are exploiting or using the supplying industries for their own operation. This can be in terms of their cost of raw materials. They can use low quality raw materials and can easily cut their cost of manufacturing. This would give them a price advantage and greater profit margin.
- The unstable political condition is a big threat for any company. Sudden hartal or blockage may result in the delay or no distribution of products. It can also hamper the regular official work if there are any downtown abnormalities due to political issues.
- The corruption in the government can result in certain changes of rules and regulations. Any foreign company can easily bribe or can do heavy lobbying in order to enter the market with a product of better brand image.
Political Situation: The political situation is a big factor in any industry. This is a general factor for all of the business entities as well as for the general public. Any political disorder results in problems of the organizations’ daily hazards. For example, hartal, strike etc can hamper the normal product distribution of ACME to the local or regional distribution.
Economic: It is a general factor that affects any profit making organization. It explains the market demand supply, public disposable income etc. ACME would export product to that countries which has got people with high disposable income. The prices of the products are to be set accordingly. In the national level, few districts have higher sales, higher profit margin and also higher distributors or trader profit. For example Dhaka, Chittagong, Bogra, Sylhet, it can also be based on area, Dhanmondi, Gulshan, Banani etc.
Social: This general factor is important because it defines the culture, rules and norms and other influences of the Society that the country is operated in. ACME cannot easily have higher profit margin because our society is not accustomed to habit of having Juice or Tea in a regular routine manner. They do not understand the importance of juice in their daily diet or having pure refined mineral water on roads. They do not understand how having branded tea is useful to their health. So, it is affecting ACME.
Technology: ACME is a manufacturing company. So technology is a big general factor for any manufacturing company. The machineries that are being used are a part of the technology. Different machines have different production capacity. They need trained personnel to operate them. So the training facilities come into play as well. The workers of the plant need to be aware of the upcoming technologies and their preliminary education is also a factor. Here comes the question of their payment. This shows how important technology is and how it is affecting the operation of the organization.
Analysis of some critical factors for the Company
The type of government in control is a major general factor. For example, in these days of Globalization, Foreign Direct Investment is a general thing. But it depends on the ruling government. If the government welcomes foreign direct investment then it becomes a problem for the local companies because lot of foreign giants would come to dominate the market which is currently dominated by Pran, Shezan, Starship, ACME etc. Dabur is trying to enter Bangladesh but are not being able to. Government is also important because they can monitor the product prices, product quality and also set up new rules. Government lobbying is a very important factor in Bangladesh. The type of government is very influential and it can also affect the company, for example how corrupted the current government is or how high the transparency is.
This specific factor prevails in any industry and for any company. It sets up the prices, shows the quality of the promotional activities of the industry, taste of the product etc. On the other hand, Taaza is so advanced in its promotional activities that are creating a huge gap in competition where Ceylon tea or ACME tea is not being able to compete.
It is a general factor that is there for every type of markets and products. For example, ACME is a corporate brand. Our brand symbolizes sophistication. That is why the main target of our mineral water customers is restaurants, hotels, institutions and cafeterias. Sheraton, Four seasons and other restaurants use our mineral water. Recently, BSTI has announced that every product has to set up packaging in Bengali; we must use Bengali in product bodies. We have to write the product names in Bengali. This can hamper our brand image in that sort of hotels, and now, we have to change our package printing in that way. This is a matter of time and costing and also a determinant factor for the external customers. This external factor is a big issue for any company in any industry.
Target Market: This specific factor gives the company the narrow direction that is should hold on to. To be specific, this factor gives the organization the phenomena on which to make the profit. It is as important as the name suggests. For ACME, there are different target markets for different products, Juice 150, 250 and 1000 ml have different target markets. Same goes with water and Tea.
Demographics (Population Size): it is the population size, shape and overall estimation of the general population. No matter it is one of the most influential general factors for every market. It describes the population size and provides an estimation and calculation for the Market size. Dhaka has a population of 20 million, but that does not mean that 20 million is the market size of ACME. Our market size is within the population which is characterized and described by Demographics.
It is specific for specific industries. For ACME, the supporting industries are Distribution, Media, Software, Packaging agencies; Trade Market etc. these industries support the operation of ACME. For example, TV channels, Newspaper, Billboards and all other media enables ACME to communicate with the target market, packaging companies like tetra pack helps us to enhance better packaging for our products. Advertising agencies like paper rhyme and Ogilvy helps us build our product and prepare our communication and marketing plan. These are all different industries but it shows how importantly and closely they are related to our operations.
Supporting industries in general view:
We have talked about the supporting industries of ACME. Now let’s look at it from a general perspective. Supporting industries discussed in the specific factor are different industries which play very important part in the operations of other companies as well. They may be our competitors or our sister concerns. Now, from general viewpoints, how well or how differently other companies can use them makes a lot of difference in any industry. For example, let us look at how brilliantly they are being used by Unilever or Square, or even Ericsson or Nokia. This is changing the market about the effectiveness and efficiency of how well they are being used. These are difference making effects on the whole market and the overall business.
Factors Critical for the exchange Rate Movements of Currencies:
This is very important for the companies as well as for countries in the international market. Talking about it in the specific sectors, let us take the case of ACME exporting products to UK. We have to take consideration of the income level, inflation rate, exchange rate between Taka and pound. When the inflation rate of UK is higher than that of Bangladesh, there would be high prices of UK products in UK. But compared to the UK local products, the prices of Bangladeshi products would be cheaper. Therefore, there would be an upward pressure on the demand for the Bangladeshi goods which also includes ACME products. This would also enable ACME to earn higher profits. On the other hand, if the exchange rate is high, for example 100 TK gives £1, then ACME would have certain amount of profit, but when it is !20 TK to £1, then the profit calculation changes. Now, this exchange rate is influenced by critical factors like Income Level between the two countries, Inflation rate, interest Rate, and also the economic factors of the two countries.
International Financial Market:
In the Macro view, there are lots of things that can affect the exchange rate movement between two countries and also between the capital flows of the business operated in both the countries. These factors includes like Balance of Trade, Export, Import, Duty, Taxes, Quotas, Balance of Payments, Financial Aid, Current Account and Capital Account. These things affect any business both internationally and nationally.
Customers are the most important stakeholders because they are the key to our purpose of running our business. Directors are the persons who are responsible for the existence and continuation of the business. ACME is a private limited company so there is no question for shareholders. The government is another stakeholder because they are affected by the nature of the product we sell and our tax payment and our operations countrywide. Supporting industries can be our Banks and all other companies that provide their services to us.
Raw Material Specification for Mango Pulp:
|01||Physical Appearance||The Pulp shall possess uniform color, characteristic taste and flavor of mango. It shall be free from any foreign particles.|
|05||Acidity (as Critic acid in m/m)||0.40% – 0.60%|
|06||Brix (Sugar%) at 20 degree Centigrade||14.00% – 16.00%|
|07||PH||3.50 – 4.00|
|08||Viscosity (Spindle 4, 50pm)||3000 cP – 5000 cP|
|09||Total soluble solid (in m/m)||15.00% – 20.00%|
|10||Specific gravity||Not less than 1.050|
|11||Arsenic (As in mg/kg)||Maximum 0.20|
|12||Lead (As Pb in mg/kg)||Maximum 0.30|
|13||Cooper (As Cu in mg/kg)||Maximum 5.00|
|14||Zinc (As Zn in mg/kg)||Maximum 5.00|
|15||Tin (As Sn in mg/kg)||Maximum 25.00|
|16||Sulfur Dioxide (in mg/kg)||Not more than 40 ppm|
|17||Total Count||Less than 50 cfu/g|
|19||Yeast & Mould||Less than 50 cfu/g|
Net Weight: 150 ml, 250 ml and 1000 ml tetra packed
Product: Orange Juice
Raw Material Specification of Orange Pulp:
|01||Physical Appearance||The concentrate shall possess uniform color, characteristic taste and flavor of orange. It shall be free from any foreign particles.|
|03||Taste||Must be characteristic of Orange|
|05||Acidity(As Citric Acid in m/m)||3.80%-4.80%|
|06||Brix||Not less than 63%|
|08||Total soluble solid (in m / m)||75%+/-2.50%|
|09||Arsenic (As in mg / kg)||Maximum 0.20|
|10||Lead(As Pb in mg / kg)||Maximum 0.30|
|11||Copper (As Cu in mg / kg)||Maximum 5.00|
|12||Zinc(As Zn in mg / kg)||Maximum 5.00|
|13||Tin ( As Sn in mg / kg)||Maximum 25.00|
|14||Sulfer Dioxide (in mg / kg)||Not more than 40 ppm|
|15||Total Count||Less than 50 cfu/g|
|17||Yeast & Mould||Less than 50 cfu/g|
B. Price list of Acme Juice:
Unique Taste & Flavor.
Hygienic UHT Packs
Nutritionally rich, free of noxious preservatives.
Meet the requirement of the consumers of all ages & groups.
Free of noxious preservatives.
Can be used at all times round the year.
Gives a feeling of freshness all day long.
Can be used by all in the family.
Prevents offensive diseases.
ANALYSIS OF MARKET SIZE, SEGMENTS & SHARES:
Total sales of fruit juice are approximately TK. 144 crore per annum.
Market growth rate (annually total market) is approximately 19%.
Mainly six companies are competing with each other.
Pran is holding the market leader position with approximately 53% market share.
We are in the second position with 18% market share.
Starsihp at 10%, Danish at 11%, Shezan at 8% and others.
Due to consumers’ increasing awareness regarding healthy diet and fitness, 20% consumers have switched to fruit juice from CSD (Carbonated Soft Drinks) last year.
Akij Group came up with a new range of fruit juice named “Frootika”.
ANALYSIS OF THE COMPETITION: PROMOTIONAL STRATEGY & DISTRIBUTION NETWORK
A brief account of the promotional strategy of Pran, Danish and Starship is given below:
PRAN was supported through TVCs and press media in a consistent basis. In terms of pitch the respective brand appeals were used. Pran has top of the mind awareness among all cross section of people due to its heavy media presence and strong distribution network. Pran has been made a strong claim “Deshi” through their TVCs which is exceptional compare to other competitors. To make the Group’s products available at the every knock & corner of the country PRAN has developed the best sales & distribution network all over the country. To ensure fast & smooth distribution companies has set up 9 distribution depots & have appointed more than 1000 dealers all over the country. To cope up with the rapid & ever changing market situation & to come up with innovative marketing strategy and ideas company has set up a full-fledged In-house advertising agency comprises of the best talents of the country. Company spends a large portion of their promotional budget in brand building exercises at home & abroad. Lastly their winning strategy of market leader is Hammering.
Recently commissioned, this unit produces highest quality fruit drinks under the brand name Danish Fruit Juices. In addition to their vast sales and distribution network of dealers, they have 6 sales depots located at strategic points. They have mobilized adequate distributors to serve all parts of the regions; they are one of the largest distribution organizations in Bangladesh. This network makes possible the flow of goods from the producer through intermediaries to the buyer. Their network and operations are described below:
No. of towns under regular coverage are 177.
No. of distributors are 194.
No. of outlets under regular frequency are 97,665.
No. of sections (each consist of 50 outlets) are 1782.
No. of Sales Area is 14.
No. of Sales Territory is 80.
Among the several units of Abul Khair Group, milk and beverage is one of the most vital divisions of the group. They have three different types of products in their juice category, which include Mango, Orange and Pineapple with three different SKUs 250 ml, 200 ml and 125 ml. Their target market is mainly commercial user as well as Family consumer. They positioned their brand from upper mid level to the mind of consumer. They have a nation wide coverage through their strong distribution network and also engaged in exporting. Their main mission is to create brand demand, image and customer confidence by ensuring quality, availability and rich communication with ultimate consumer. As Danish is in the media with their current TVC, it has significantly high top of the mind recall. They offered a discount for their kids pack. “Fol’er raja aam, ar aam’er rosh’e Danish”- through this line they made a significant high top of the mind recall towards their target customers.
Distribution Network of ACME Juice:
To various Depots (16)
Marketing Plan Of ACME Mustard Oil
The Mustard oil market in Bangladesh is not as huge as the other FMCG products’ market. But figures show that it is still a handy one and is worth investing in order to increase product line. There are three main players in the market Radhuni, ACI Pure and Shuresh Mustard Oil. The market is not very big. The demand of the products fluctuates according to the economic and market conditions because these are not necessary products. But with proper marketing plan the market demand can be manipulated and demand can be increased. This paper is written as part of the course and is on the launch and marketing plan of Mustard oil by The ACME Agrovet and Beverages Ltd.
The Mustard oil segment is characterized by the presence of players each having a number of offerings in terms of platform and/or benefit offered.
|Radhuni||Plastic bottle||250 ml||40 TK||36 tk/36.5 tk|
|ACI Pure||Plastic bottle||200 ml||35 TK||31 tk to 31.5 tk|
|Suresh Mustard Oil||Plastic bottle||250 ml||40 TK||35 tk/35.5 tk|
Benefit Propositions of the Major Players
The players play in the industry by price and coverage. The packaging is good for Radhuni and ACI Pure for their attractive design. Among them Radhuni got very attractive design. For Shuresh Mustard Oil, the packaging is not an issue. They try to focuses on the rural flavor. We can see in the above pricing column that Radhuni is targeting more premium segment and ACI Pure is just competing with it. Shuresh Mustard Oil is targeting narrow segment. This may be the reason as Shuresh Mustard Oil is a small organization. Their main distribution relies on the distribution plan that they have for their other products. They use the same sales force to communicate with the retailers and distribute the products. The production facilities are the same as they got different product facilities in their product basket.
The benefit propositions being offered by the major players in the market are as follows:
|Radhuni||Taste, Quality, Packaging|
|ACI Pure||Taste, Quality, Packaging and Price|
|Shuresh Mustard Oil||Quality and Price|
In order to strengthen their distribution strategy, the players provide incentive for the retailers in order to shelve and promote their products to the consumers. These strategies help them to persuade the retailers so that they can offer and these products. The retailers even persuade the consumers to buy these products of companies whose offers satisfy them most. The benefit segment is dominated by major players and their respective value share in the market is as follows:
|Radhuni||They offer a margin of 4 taka to the retailers with occasional gifts like wall clock spices item or show pieces.|
|ACI Pure||They offer the highest trade margin ranging from 4 tk to 4 tk. They too provide the same trade offers.|
|Shuresh Mustard Oil||Their distribution and production is the highest among these 5.|
Analysis of Competition:
The competition game is not that great due to lack of players in this segment and lower demand. But there are several factors that make differences in the sale of these products.
Usually, these products have a long life span. Radhuni is the most successful among these three due to its longer expiry time frame.
Due to quality factors, these products have to be stored in dry place. Retailers have to make choices on which products to store in which places as there are different sizes of shops. Where they store the product is very much important issue. The product can not destroy easily so they can store a lot of amount of the product.
Income Segment Target Market:
This is the most important factor. In analyzing the demand, we must see the consumers who are buying the product, which is the reason behind the manufacture and investment.
Mustard oil is very much demandable product and it is used almost every family. From lower middle class to the upper class people everybody use the products.
The distribution is simple. These products are distributed along with the other products of the company. From the factory, the products are taken to the central warehouse. These products are carried mainly by the delivery vans and distribution trucks. Then they are taken to the distributors, from there, they are carried to the retailers. Companies use the same distribution facility in order to carry these products along with the other products that they have.
ACME Mustard Oil
With proper marketing plan and promotion, we can create the demand for this product. The ACME Agrovet and Beverages Ltd can launch this product to increase their product line, and with existing distribution network and sales force, they can come up with profitability. With the brand “ACME Mustard oil”, ACME can launch this product and a feasible marketing plan is designed to make this product a successful one.
This Agrovet and beverage industry has got some critical factors. The most important of them is pricing. Although Brand is very important aspect by which we can persuade consumers to buy the product but it is a part of promotion. The depreciation costs, fixed assets costs, production costs, packaging costs, salary and lot of other factors are critical, but the pricing is set considering these factors. The industry is mainly focused on the product taste, price and availability. 1 taka or 2 taka price difference is a key factor in pushing this product into the market. Initially, these products are pushed into the different outlets (Shelving) for them to be available into the market, and then through promotion, they are pulled by the consumers.
Michael Porter’s Five Forces Model:
Threat of new Entrants: this depends on who is entering. Generally, this threat is low because it is not every now and then that a company is entering this industry. But when we judge the market and see that most of the local giants like ACI Ltd. However not in large scale but in locally some company may start to produce the Mustard oil.
Industry Rivalry: Since this industry is very price sensitive the rivalry is very high. Price depends on all the internal expense and operational costs of the company, that is why, it is not easy top be price-change responsive for all the companies. For example, if Pran Juice decreases Juice price for 1 TK, ACME Juice may not be that much responsive to this change because they simple cannot. Radhuni is nationally a great player; it costs 24 TK. for its 250 ml , whereas ACI and others cover it in 23 TK.
Substitute Products: For Juice, the substitute products are other energy drinks, fruit drinks and other Chinese natural drinks. For Tea, the substitute is Coffee and for mineral water, the substitute is carbonated soft drinks. For juice, the pressure of the substitute product is moderate because now, the population is increasingly becoming aware of how important it is to have some juice in their daily lives. For mineral water, the pressure of carbonated soft drinks is becoming lower because people have become aware of the side-effects of daily consumption of those products. For ACME Mustard oil the main substitute product is olive oil, which is not used in our country.
Bargaining Power of Buyers: undoubtedly, this is very high. The buyers are they key to this industry and they can have whatever they want in this price sensitive industry. With the pull strategy being used extensively, the buyers are absolutely pressure free for whatever they want to have.
v Production research and development
v Product Quality and Price for Dual income Families
v Export ease to pharmaceuticals international markets
v Part-time employees
v Hiring of trained personnel from supporting industries
v ACME group can do government lobbying to stop foreign players.
v Product quality can fight with fake products.
v Change in traditional thinking can realize competitors’ opportunities.
Marketing Strategy for ACME Mustard Oil
Target market & Consumer profile:
Socio-economic Class: urban and semi urban.
Life Style & Attitude: Working women as well who currently use non packed mustard oil.
In order to market the product, we can use both ATL and BTL. TV, newspaper, radio, bill board, school branding, trade offer and other social campaign can prove to be very effective. The main strategy would be to incorporate this product as part of everyday meal and make people believe that consuming this product is healthy and safe. This is the way we can create demand for this product.
Billboard is one of the most useful promotional tools for any brand. The scope of its visibility is very much higher compare to other promotional tools. But due to extreme popularity of media mix, its value is getting down day by day. Currently ACME has some billboards across the country. All of them are in a very prominent place where the visibility is too high. Considering the budget constraints if it is possible then we should take few more billboards all over the country.
A heavy thrust on merchandising will take place. Emphasis will be given to activities like window hiring, display competition, etc. A special effort will be made to create some obstacle on other antiseptic/antibacterial soaps.
POP materials like stickers would have to be used to remind the target customers at the point of purchase. In addition these should also serve the purpose of informing those who are still unaware till the time of purchase. POP materials include buntings, danglers, shelf talker, bus hanger, poster etc. Some proposed POP materials for superstore and for upper class level are showed as below:
MEDIA MIX OF THE CAMPAIGN
Publications will be carefully selected keeping in mind the target customers. Regional newspapers will be used to increase usage and sales in the respective regions. The circulations of the newspaper are described as below:
|17||Bangla Bazar Patrika||5,000|
Newspaper Readership (%):
Sample size: (Across Urban, Metro and Rural):14,880 persons
After completing a successful launch we should go for press communication through large size color (10 col x 4”) insertion for at least one month in the highest circulation papers. It is described as below:
|Sl.||Publications||Position||Size (Col x inch)||No. of Insertion||Cost|
|1.||Prothom Alo||Front page (Color)||10 col x 4 inch||2||473600|
|2.||Jugantor||Back page (Color)||10 col x 4 inch||1||154000|
|3.||Ittefaq||3rd page (Color)||10 col x 4 inch||2||295200|
|4.||Daily Star||Front page (Color)||10 col x $ inch||2||384000|
Most read Magazines
So in the same time we should go for some insertions to the magazines which are read by the consumers mostly.
Ownership of Radio (%):
Sample size: (Across Urban, Metro and Rural):14,880 persons
Radio campaign will be developed and released in central station. A significant thrust will be on radio campaign as it is one of the most important media that reaches a large majority of semi-urban and rural dwellers. As a result after completing a successful re-launch we can develop our radio plan in the following manner:
Foorti 88.0 fm
Brand: ACME Chocolina
Duration: 30 Sec.
|Hello Dhaka (7am-9: 30am)||Before||30||25||320||225000|
|Dhaka Calling (4pm-8pm)||Before||30||25||320||270000|
|Add 15% Vat||74250|
Total number of spots Program wise:
Today 89.6 fm
Duration: 30 Sec.
|Hello Dhaka (7am-9: 30am)||Before||30||20||320||162000|
|Dhaka Calling (4pm-8pm)||Before||30||20||320||216000|
|Add 15% Vat||56700|
Total number of spots Program wise:
Top 10 TV Channels:
The television campaign will go during the launching month er. Thereafter a shorter version of TVC will be followed in the next. Spots will be scheduled during the launch phase in a way that the spots are placed before programs with high viewer-ship, i.e. Bengali Package Dramas and Magazines etc. In addition, sponsorship of dramas, serials and events may also be considered. Strong brand equity can be developed through TVCs by sponsoring public health message related serials/dramas aimed at propagating hygienic practices in the daily life activities.
Brand Name: ACME Mustard Oil
Quantity: 250 ml
Trade Price: 18 tk
Market Price: 22 tk.
- Gives quality assurance.
Appearance and feel related attributes
- Eye catching promotion
- Shape has a premium look
- Attractive label color
- Attractive pack
- Modern pack
- Eye-catching pack
- Suitable for all seasons
- Suitable for all in the family
- Product of a reputed manufacturer
Conclusion and Recommendations
- Persuasion: in addition to the attraction of the children, we also have to work in making the parents believe that this product is good and useful for kids to consume. Parents should understand what they are providing their kids and it is an easier way to provide energy.
- Universities and Schools: We have to talk to different private universities to go through a win-win relationship. We would ask them to use our branded Wall Clock in every classroom. We would sponsor their clubs, for example Young Entrepreneurs’ Society in NSU, AIESEC in IBA, etc in their social activities, in return we would provide part time jobs for their students with certain requirements in our Agrovet and Beverage department. Here, we can fulfill the setbacks of this department by employing these part time students at a much lower salary and they can deliver the services that we take from other departments of the ACME group. For example, several designs that are prepared by the designers of the pharmaceuticals departments are not up to the mark and require consistent briefing. With students and their creativity, we can use the services at a much lower cost where we do not have to higher professionals for our Agrovet. In this way, we can develop our employees for future. In this way, the universities can also advertise that they can manage part time jobs for their students.
- Malhotra K. Naresh, Marketing Research, 4th Ed. Pearson Education; India. 2004.
- Secondary Data: Sirius MKT & Social Research Ltd., Market data