Hamdard university Institute of management science MARKETING PLAN OF NEW PRODUCT QARSHI JOHAR JOSHANDA CHOCOLATE, QARSHI JOHAR JOSHANDA PURE HONEY& QARSHI JOHAR JOSHANDA SUGAR FREE COURSE PRINCIPLES OF MARKETING SUBMITTED TO Miss Qnita Imtiaz SUBMITTED BY Hasham Ahmed khan
CONTENTS ACKNOWLEDGEMENT................................................................................................................................................... 3 AUTHORIZATION LETTER ............................................................................................... Error! Bookmark not defined. LETTER FROM QARSHI INDUSTRIES .............................................................................................................................. 4 Chapter 1 MACRO-ENVIRONMENT............................................................................................................................... 5 CHAPTER 2: MICRO-ENVIRONMENT ............................................................................................................................. 8 CHAPTER 3: MARKETING OBJECTIVE .......................................................................................................................... 15 CHAPTER 4: PRODUCT ................................................................................................................................................ 22 CHAPTER 5: PRICE ....................................................................................................................................................... 24 CHAPTER 6: PLACE ...................................................................................................................................................... 26 CHAPTER 7: PROMOTION ........................................................................................................................................... 28 CHAPTER 8: PRODUCT LIFE CYCLE .............................................................................................................................. 30 CHAPTER 9: RECOMMENDATIONS ............................................................................................................................. 31
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ACKNOWLEDGEMENT
First of all, we thank Almighty Allah who gave us the ability to think, work and deliver what we were assigned to do. Secondly, we must be grateful to our teacher Sir Munir who guided and supported us and really cooperated with us throughout this term paper. We are really thankful to Mr. Moin Alam (Manager Channels & Marketing of Qarshi Industries)who took out time from his busy schedule to provide us with the information about QarshiJoharJoshanda and its variants.
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LETTER FROM QARSHI INDUSTRIES
Dear Professor, This is for your kind information that your following students has been visited our office for QarshiJoharJoshanda’s product knowledge
Hasham
Regards, Moin Alam Manager Channels & Marketing Qarshi Industries (Pvt) Ltd.
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Chapter 1 MACRO-ENVIRONMENT The macro environment consists of broader forces that affect the actors in the microenvironment. These factors are demographic, economic, natural, technological, political and cultural environment. CULTURAL ENVIRONMENT Culturally, Pakistan is a little different society so how does QarshiJoharJoshanda fit amongst target market? Using herbs as a medicine is not a new concept in subcontinent, its many centuries old concept. Our elders used to make medicine for cough and flu by mixing various herbs, and the people who indulged themselves in this profession were known as ‘Hakeem’. With passage of time, Qarshi Industries realized that they could make such herbal products with laboratory tests by maintaining all the quality control norms. So what they produced was not a totally new concept for Pakistani society, instead they just modernized what their ancestors had been using for last many decades. It was easily accepted and trusted by the target market, and what achieved the height of success despite being a new company in Pakistan, as compares to some pre-partition herbal companies. Did you face any problems for producing herbal products? Which is originally an Indian concept, not ours? “Honestly speaking, we did not face any such problem. Yes this is originally an Indian concept, but our elders have always used herbs as a medicine for various diseases so largely people accepted our products. Before we launched JoharJoshanda, we came to know Hakeemsused to make such a product for cough and flu by mixing various herbs. So what we did was not something new for many of us.” - Mr. Moin (Manager Channel and Marketing – Qarshi Industries) DEMOGRAPHIC ENVIRONMENT The changing demographics in Pakistan are a big opportunity for Qarshi. Because of growing number of children, they are able to extend their target markets by new flavors which mainly focus on children, likes of Chocolate and Honey JoharJoshanda. Moreover with the increasing number of diabetic patients, Qarshi has launched JoharJoshanda Sugar Free to target that segment as well. The estimated population of Pakistan by Population Census Organization latest by April 2013 is 183 Million. Province Sindh Punjab Balochistan Khyber Pakhtunkhwah
Population 40.6 Million (22.2%) 98.2 Million (53.7%) 8.7 Million (4.8%) 23.6 Million (12.9%) 5
Islamabad FATA Azad Kashmir GilgitBaltistan
1 Million (0.6%) 4.2 Million (2.3 %) 4 Million (2.2%) 2.4 Million (1.3%)
Population of Big Cities Lahore Karachi Total
12.5 Million 21.2 Million 33.7 Million (18.4% of total population of Pakistan)
Population Population ages 0-14 (% of total) in Pakistan Population ages 15-64 (% of total) in Pakistan Population ages 65 and above (% of total) in Pakistan Population; female (% of total) in Pakistan Population growth (annual %) in Pakistan
Percentage 36.4 59.4 4.2 49.1 1.8
ECONOMIC ENVIRONMENT Effect of recent economic recession on sales of QarshiJoharJoshanda The price of JoharJoshandais very low i.e. Rs.5 which everyone during recession could afford so they were not badly affected by economic recession and mostly, this brand is used as a medicine so people were bound to get medicine no matter what economic difficulties they were going through. In fact, recession was an opportunity because the antibiotics and anti allergic medicines are quite expensive so people can look for alternative medication in the form of herbal medicines. THE REGULAR USER OF QARSHI JOHAR JOSHANDA People from all social classes use this product, be it lower class or elite one. However, we have found middle class use it the most. NATURAL ENVIRONMENT Qarshi Industries make sure that they do not produce a harmful effect on the natural environment. Qarshi Industries is ISO-14001 certified. The raw materials and herbs are procured by the suppliers who continuously plant trees and herbs in the northern areas of Pakistan. POLITICAL ENVIRONMENT Qarshi has faced political problems because there is a system of political funding ‘parchi’. The ‘receipt system’is much prevalent in the wholesale markets which creates a lot of problems. In fact, they have received receipts on a number of occasions. The retailers fear that if they will not give money to these political parties, their shops and warehouses will be burnt. One big wholesaler of Qarshi also received 6
receipts but he used to hide when those political workers came. On Sunday when the market was closed, those political workers made a wall infront of his shop and they wrote on it that whoever tries to break this wall will be punished and they will tear his hands apart. Well Qarshi Head office takes care of these political issues and they try to do some negotiations.
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CHAPTER 2: MICRO-ENVIRONMENT COMPANY Qarshi Industries (Pvt.) Ltd. is one of the largest natural products companies in Pakistan. It is a modern and progressive facility that manufactures and markets leading brands that have become household names. As a leading manufacturer of Natural Products, Qarshi is engaged in promoting healthy living for over seven decades. It has been offering blend age-old Oriental and Greek herbal preparations with the latest advancements in science and technology to provide safe and effective products to its customers. In 1968 the youngest son of Shifa-ul-Mulk, Mr.Iqbal Ahmed Qarshi after completing M.S.C in Chemical Engineering, laid the foundations of QarshiDawakhana that has now evolved into Qarshi Industries, a modern and successful company that outweighs by far, the expectations of its original founder. Qarshi Industries is highly rated company in its category in Pakistan. It has consolidated its image as a quality-conscious company and has, over the year, demonstrated its firm commitment to quality and strict adherence to international standards. Qarshi takes pride in maintaining a high quality in its products and superior skills and acquiring the latest in advanced technology.
VISION STATEMENT Distinctive Leadership in Quality, Human Resource, Research & Development, Corporate Social Responsibility MISSION STATEMENT To be Premier source of knowledge and Leadership for the Achievement of Economically, Environmentally and Socially Sustainable Development
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PRODUCT MIX OF QARSHI INDUSTRIES
QARSHI INDUSTRIES FOOD AND BEVERAGES Refreshing Syrups
Natural Mineral Water
HEALTH CARE
Male Disorders Anti Allergics
Soft Drinks
Ketchup & Sauces
Jams, Marmalades, Murabbas & Honey
CNS Disorder Blood Related Disorder
Tooth Care Renal Urinary Gastro Intestinal Disorder
Johar Joshanda Anti Pyretic Disorder
Instant Powder Drinks
Children
Ear Disorder Orthopedic Disorder Heart Disorder Respiratory Tract Disorder
Tonics Liver Disorder Research Products
Female Disorder Personal Care
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Food and Beverages
Refreshing Syrups
Jam-e-Shirin
Natural Mineral Water
Other Syrups
Sugar Free Jam-e-Shirin
Soft Drinks
Applesshhh
Johar Joshanda
Lemonsshhh
Johar Joshanda Sugar Free
Springley
Sharbat Sandal
Johar Joshanda
Jam-e-Shirin Sharbat Illachi
Johar Joshanda Chocolat
Sharbat Bazoori
Johar Joshanda Pure Honey
Jam-e-Shirin Calcium Enriched Jam-e-Shirin Lemon Flavored Jam-e-Shirin Sugar Lite
Food and Beverages Jams, Marmalades, Murabbas & Honey Jams and Marmalades Orange Marmalades
Apple Jam
Murabbas
Murraba Harar
Instant Powder Drinks
Honey
Ketchup & Sauces
Garden's Kino
(Beri) Jujuba Honey
Tomato Ketchup
Garden's Lemo
Pure Honey
Tomato Free Ketchup
Garden's Falsa
Chilli Garlic Sauce
Garden's Peach
Murraba Carrot Fig Jam Mango Jam
Ginger Marmalades Murraba Apple Mixed Fruit Jam Murraba Amla
Mulberry Jam
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HEALTH CARE Male disorders
QairootiKhas Zarjam Vitavig Protone TilaMuskan No. 1 Tone Up Tonic ArqShirin Ghutti Aller-Z
TilaMuqaviShahi Sozak Shahi (Capsules) Asphaton
Safoof-e-Mugha Ginsovit ImsakiJawahar
Corezcol Hoopinil SadaBahar Allergex
NauBahar (Natu
CNS Disorder
Demaghi ItreefalKashneezi ItreefalUstukhudus
Hayateen KhameeraGaozabanAmbri
MajoonAzaraki MajoonNajah
Renal Urinary
Zubex Prostnal Pathri Tore SharbatUnab (Adviati)
Thandak Hab-e-Gurda SharbatBazoori Musaffeen (Tablets)
Urosinal MajoonPhilasph JawarishZaroon Musaffeen (Syru
Zanjabeen Zancid Akseer-e-Pachish Akseer-e-Pachish Typhex Plus Bukhareen
AmratDhara Antifat SharbatAnjbar ArqBadian B.M.81
Chuarqa Deedani Piles-X Oil Pileen Fever-X
Ahmareen Ambreena Tonic JawaharMoharaKhas Goshina
SharbatFaulad Fauladi Tonic
KushtaBaikhMa JawarishShahi
ArqMako
Children
Anti Allergic
Blood Related Disorder Gastro Intestinal Disorder Anti Pyretic Disorder Tonics
Ear Disorder Liver
Akseer-e-Jigar (Syrup)
MajoonDabeed 11
Disorder
Akseer-e-Jigar (Tablets)
KushtaFaulad
MajoonKhabs-u
Orthopedic Disorder
Taryaq-e-Nazla (KhameeraKhashkhashKhas)
RoghanAujaa HabAzaraqi
HeptaCare
Suranjeen MajoonSuranja
Research Products Heart Disorder
Garlicare KhameeraGaozabanSada Shafai Kardil
KhameeraAbres KhameeraGaoza
ArqGaozaban Dawa-ulMiskMutadilJawaharWali Dawa-ul-MiskMutadilSada KhameeraMarvareedKhas
Supari Pak A-Lecor Khatooni Taryaq-e-Nazla Surficol (Tablets) Asthmina Surficol (Syrup)
Kushta Sadaf Lecodine
Mensofar Habis
KushtaAqeeq SharbatBanafsha SharbatSadar Sharbat Toot Siah Mulberry)
KhameeraAbres LalSharbat LaooqSapistan KhameeraBanaf
Female Disorder Respiratory Tract Disorder
Personal Care
(Black
Arq-e-GulabKhalis
SUPPLIERS Qarshi has a numbers of suppliers who provide them with the best quality raw materials and herbs. There are some particular suppliers of Sugar. Qarshi has strict policies regarding quality and if any supplier gives them substandard raw material, Qarshi doesn’t deal with them. The suppliers of Qarshi play an important role in minimizing the cost of transportation. They deliver the raw materials to the plant in Hattar. MARKETING INTERMEDIARIES Following are the intermediaries of Qarshi Industries. Physical Distribution Firm Marketing Service Agencies PHYSICAL DISTRIBUTION FIRM Premier Distributors are sole distributor of Qarshi Industries. They help Qarshi Industries in storage, as well as transportation of the products to the consumer market. They have 2 storage warehouses one in Lahore and one in Karachi. When the products are manufactured, they are sent to these warehouses. Premier Distributors have deals with the several sub-distributors who then distribute the products to the 12
retailers. Previously Qarshi Industries had around 350 distributors but there was a lot of blame game among the distributors and it was difficult to monitor all the distributors. Therefore now Premier distributor is their sole distributor for the past 5 years. MARKETING SERVICE AGENCIES Qarshi Industries have two marketing service agencies namely Manhattan Leo Burnett and Adcom Private Limited who help them in media planning, advertising, and market research. Adcom Private Limited has made the advertisements of QarshiJoharJoshanda. FINANCIAL INTERMEDIARIES There are no financial intermediaries. Total finance is of the owners.Qarshi has a policy to minimize the cost per employee. WHOLESALER AND RETAILERS QarshiJoharJoshanda is sold in almost every medical store. The wholesalers and retailers keep it because it is in high demand. COMPETITORS INDUSTRY COMPETITION According to AC Nielsen reports, following are the market shares. BRAND QarshiJoharJoshanda
PRICE Rs. 5
Market Share 80%
HamdardJoshina
Rs. 5
10%
MarhabaJoshanda
Rs. 5
6%
Hashmi Joshanda
Rs. 5
4%
FORM COMPETITION BRAND Tandegyl Zyrtec Hydrillin Pulmonal Flueze Amoxil Augmentin Sancos
PRICE 44 46 59 65 30 56 70 55
Quality (Rating on scale of 10) 7 9 8 6 8 9 5 6 13
PUBLICS Following publics have an impact on Qarshi Industries’ ability to achieve objectives. MEDIA PUBLIC Media publics including newspapers, magazines, and television channels have an impact on the marketing of Qarshi. Their print ads are published in various magazines like AkhbareJahan and Sunday magazine. Moreover, their TV commercials are also shown on various TV channels. INTERNAL PUBLIC Qarshi Industrieshas its own monthly publication by the name of QaumiSehat in which they communicate with the external publics. CUSTOMERS Qarshi is currently targeting the consumer markets, reseller markets and international markets. CONSUMER MARKETS In consumer markets, they are targeting the masses with their low cost and high quality brand JoharJoshanda. They have targeted the mass market including diabetic patients and children with theirJoharJoshanda flavors Sugar Free, Chocolate, and Pure Honey. RESELLER MARKETS Qarshi provides a number of schemes for resellers for example if the resellers buy their products in large quantity they get a scratch card through which they can get gifts. Moreover, they on the purchase of 30 boxes, they get 1 free box of JoharJoshanda. The distribution of Qarshi is really good and that is why the resellers are quite happy to work with Qarshi Industries. INTERNATIONAL MARKETS Recently, Qarshi has gone into the international markets in USA, UK, Saudi Arabia and South Africa where it has its own outlets. The most popular brands that are in high international demand are Jaam-eShirin and JoharJoshanda.
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CHAPTER 3: MARKETING OBJECTIVE THE NEED FOR LAUNCHING JOHAR JOSHANDA For decades, people in villages, towns and districts used herbs for the remedy of cough, cold and flu. Then Qarshi Industries decided to provide them with a readymade high quality herbal tea by the name of JoharJoshanda which means “Essence of boiled stuff”. In this way, people could easily get a herbal tea in their homes on while travelling. QarshiJoharJoshanda is an instant remedy for cough, cold and flu. This was the unique selling proposition for QarshiJoharJoshanda and their quality have always been really good. Over the past two decades, JoharJoshanda became a very strong brand and has really high brand equity. MARKETING STRATEGY The marketing strategy of Qarshi was to become the market leader in herbal food and beverages medicine industry and it wanted to have a large market share so it wanted to target the masses. Qarshialso wanted to find the unmet segments and cater them with the products that they wanted. For that reason, Qarshi did a market research and then came up with new brands. THE NEED FOR LAUNCHING JOHAR JOSHANDA CHOCOLATE, HONEY AND SUGAR FREE After a huge success of QarshiJoharJoshanda for the past two decades, Qarshi saw that now JoharJoshanda is in the maturity stage and a lot of competitors have come up with the similar product. This was the time that Qarshi Industries decided to target some other segments to differentiate and increase their market share. CONSUMER INSIGHTS Qarshi did a detailed market research with collaboration of AC Nielsen. They went to different shopping malls, schools, and other marketplaces and asked the people about their brands and the need of people. Finally, the results showed that the children didn’t like the taste of JoharJoshanda which was quite bitter so in order to target the children of age 5-12, Qarshi had to come up with the flavor that all children like which is Chocolate. In this way, Qarshi came up with “JoharJoshanda Chocolate.” Moreover; Qarshi knew that in winter season, parents give a spoonful of honey to their children because of the nutrition of honey to keep their body warm and strong so Qarshi came up with another flavor named “JoharJoshanda Pure Honey”. Qarshi also noticed that there is a big population which suffers from diabetes so this was the unmet need. Qarshi asked the people if they would like to drink “JoharJoshanda Sugar Free” which has no sweetener. The response was really positive but not from all the diabetic patients. In Pakistan, most of the diabetic patient cannot live without eating desserts and sweets etc. However, there is a small segment which includes upper class, educated, well aware and health conscious people. Qarshi then came up with “JoharJoshanda Sugar Free”.
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SEGMENTATION Qarshi Industries did the market segmentation on the basis of demographics, psychographics and geographic and behavioral dimensions. GEOGRAPHIC VARIABLES JoharJoshanda is very popular in the northern areas of Pakistan particularly the truck drivers which they have shown in their TV commercials. Well Qarshi has also tried to target the urban population. Their promotion has been to target the masses. DEMOGRAPHIC VARIABLES There were many options for QarshiJoharJoshanda. Qarshi segmented the market on the basis of age, gender and income. PSYCHOGRAPHIC VARIABLES In psychographics, Qarshi segmented the market on the basis of social class. BEHAVIORAL VARIABLES Qarshi segmented the market on the basis of benefits of JoharJoshanda. TARGET MARKET JOHAR JOSHANDA SUGAR FREE Geographic World Region or Country Density Demographic Gender Age Income
Pakistan Urban
Male, female 40 and above Rs.30000 and above
Psychographics Social class
Upper middle, lower upper
Behavioral Benefits User rate
Quality, herbal medicine so no side effects, no sweetener so diabetic patients and use it. Light user, medium user
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JOHAR JOSHANDA CHOCOLATE Geographic World Region or Country Density Demographic Gender Age Income
Pakistan Urban, suburban, rural
Male, female 5 - 11 Rs.30000 and above
Psychographics Social class
Middle class, upper middle, lower upper
Behavioral Benefits User rate
Quality, herbal medicine so no side effects, delicious chocolate flavor for children, economy Light user, medium user
JOHAR JOSHANDA PURE HONEY Geographic World Region or Country Density Demographic Gender Age Income
Pakistan Urban, suburban, rural
Male, female 5 - 11 Rs.30000 and above
Psychographics Social class
Middle class, upper middle, lower upper
Behavioral Benefits User rate
Quality, herbal medicine so no side effects, pure honey flavor for children, economy Light user, medium user 17
PERCEPTUAL MAPPING This is the perceptual mapping of QarshiJoharJoshanda along with the competitors.
High Quality
Zyrtec
QarshiJoharJoshanda Flueze
Amoxil Hydrillin
Tandegyl HamdardJoshina
High Price
Low Price
Pulmonal MarhabaJoshanda
Hashmi Joshanda
Sancos
Augmentin
Low Quality
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BRAND Tandegyl Zyrtec Hydrillin Pulmonal Flueze Amoxil Augmentin Sancos
PRICE 44 46 59 65 30 56 70 55
Quality (Rating on scale of 10) 7 9 8 6 8 9 5 6
POSITIONING JOHAR JOSHANDA SUGAR FREE To the diabetic patients who need sugar free medicines, JoharJoshanda Sugar Free is an instant herbal tea that is an effective remedy for flu, cough and physical fatigue with no side effects unlike the antibiotic medicines that provide temporary relief but cause severe side effects. JOHAR JOSHANDA CHOCOLATE To the children who hate medicines, JoharJoshanda Chocolate is an instant refreshing herbal drink that will make them happy as well as provide an effective remedy for flu, cough and physical fatigue with no side effects unlike the anti-biotic medicines that provide temporary relief but cause severe side effects. JOHAR JOSHANDA PURE HONEY To the children who are honey lovers, JoharJoshanda Pure Honey is an instant refreshing herbal drink that will give them the sweetness and nutrition of pure honey as well as provide an effective remedy for flu, cough and physical fatigue with no side effects unlike the anti-biotic medicines that provide temporary relief but cause severe side effects. PRODUCT IMAGE QarshiJoharJoshanda is a highly rated brand in the minds of people of Pakistan for the past two decades for its superior quality, economical price and effective remedy against flu, cough and physical fatigue. ESTIMATING THE SIZE OF MARKET Qarshi saw the demographics and on the basis of calculations, they estimated the size of market. The estimated population of Pakistan by Population Census Organization latest by April 2013 is 183 Million. 19
Province Sindh Punjab Balochistan Khyber Pakhtunkhwah Islamabad FATA Azad Kashmir GilgitBaltistan
Population 40.6 Million (22.2%) 98.2 Million (53.7%) 8.7 Million (4.8%) 23.6 Million (12.9%) 1 Million (0.6%) 4.2 Million (2.3 %) 4 Million (2.2%) 2.4 Million (1.3%)
Population of Big Cities Lahore Karachi Total
12.5 Million 21.2 Million 33.7 Million (18.4% of total population of Pakistan)
Population Population ages 0-14 (% of total) in Pakistan Population ages 15-64 (% of total) in Pakistan Population ages 65 and above (% of total) in Pakistan Population; female (% of total) in Pakistan Population growth (annual %) in Pakistan
Percentage 36.4 59.4 4.2 49.1 1.8
As it is clear from the above statistics that thepopulation of Karachi and Lahore is 18.4 % of the total population of Pakistan so it is a big population to target. QarshiJoharJoshanda was most popular in the rural and suburban areas particularly in northern and western areas of Pakistan. Now this was the time to target the urban population. Since 65 Million (36%) of the population is of ages 0-14 so it is a huge market. Qarshi estimated that out of 65 million, 30 million will be of the ages 5-14 Then out of these, 5 million will belong to those families which do not prefer herbal medicines. Then 4 million will belong to a segment which doesn’t prefer QarshiJoharJoshanda for many reasons such as packaging, quality, taste, inefficient awareness, competitors etc. Then 1 million will belong to a segment which doesn’t like chocolate or honey. The remaining market was of the size 20 million. In this way Qarshi estimated the size of market. This 20 million was the segment for the Chocolate and Pure Honey. Now for estimating the size of market for JoharJoshanda Sugar Free, Qarshi looked at the following statistics: There was a survey conducted by Pakistan Medical Association in November 2009and the results were shocking. 20
Out of the three hundred adults subjected to the survey, 43% adults had any awareness of Diabetes. Adults with no regular, scheduled exercise were 73.7% and 85.3% did not have healthy eating habits. Awareness of risk factors was present in 14% while awareness of the complications associated with the disease was22%. Adults which reported as never going for regular checkups to any clinic or hospital were 77%. The conclusion was that the majority of adults was unaware of Diabetes Mellitus itself and associated risk factors. Raising public awareness of the disease through outreach programmes and mass media should be planned and implemented. Total Diabetic patients in Pakistan = 7 million so the percentage of diabetic patients (% of total population of Pakistan) is 3.8% Population of Karachi is 21.2 million The approximate population of Clifton, defence, KDA Scheme and other areas of Karachi where upper middle class lives who have awareness of diabetes will be2000000. The approximate size of the market is 100000. This is a small market but an unmet market. No other competitor has come up with a sugar free herbal tea. MARKET SHARE QarshiJoharJoshanda has 85% market share in Herbal Tea sales. They sell 150 million sachets of this product annually. Total Annual Industry sales of Herbal Tea = Rs. 880 million Brands QarshiJoharJoshanda HamdarJoshina MarhabaJoshanda Others
Annual Sales Rs. 750 million Rs. 61 million Rs. 44 million Rs. 25 million
The new brands have no competitors because they are targeting separate segments. In comparison of the total sales following is the percentage of sales of the three brands. MARKET POTENTIAL Market Potential = No. of buyers x Average Consumption (Annual) JoharJoshandaChocolate =20 million x 2 sachets = 40 million sachets JoharJoshandaPure Honey = 4 million x2 sachets = 8 million sachets JoharJoshanda Sugar Free = 100000 x 2 sachets = 200000 sachets 21
CHAPTER 4:PRODUCT LEVELS OF PRODUCT Core Product: JoharJoshanda is an effective herbal medicine for cough, flu, throat pain etc. Actual Product: It contains a lot of product benefits such as innovative packages that distinguish it from other brands with a new and attractive look. It utilizes the pure herbal medicines for the healing of different patients suffering from flu, cough, fever, throat pain. They are offering three new variants to add more features in their product. They are following quality standards of ISO 9001. ISO 14001and etc. Augmented Product: JoharJoshanda does provide product support by conducting seminar and different activities at different shopping malls and schools to increase the awareness of the product and educate the people thoroughly about the benefits of the product.
Benefits, Features and Quality Standards of Johar Joshanda
Johar Joshanda
Seminars, Activities to increase product awareness and give it a support
PRODUCT & SERVICE CLASSIFICATION QarshiJoharJoshanda is a consumer product as well as a convenient product which can be available frequently at every nearest super store, grocery or medical stores. It has a low price and distributed widely all over the place. It does follow mass promotion and promotes frequently on the news and entertainment channels during the news and program breaks respectively.
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QARSHI JOHAR JOSHANDA Marketing Consideration Customer buying behavior Price Distribution Promotion
Convenience Little planning; frequent purchase and Low customer involvement Low price widespread; convenient locations Mass promotion
PRODUCT AND SERVICE ATTRIBUTES PRODUCT QUALITY Qarshi industries (pvt) limited never compromises on the quality of its products. That is the reason why they have their own R&D Laboratories where proper practical experiments were carried out before launching any joharjoshanda products. They keep their testing continue for 1 – 2 years before launching it into the market.Qarshi is the only organization in SAARC, Middle East and Africa having 8 International / National Certifications and Accreditations ISO 9001. ISO 14001, HACCP, HALAL, ISO 17025 (Norway & PNAC), Organic and PCP Certification. They have their own auditing department for the overallmonitoring of the process and they have their own farms as a raw material for producing joharjoshanda and its variants. PRODUCT FEATURES They have added with three new variants of joharjoshanda: chocolate, honey and sugar free, to add more features in the product. Three different flavors target and benefit different segment of peoples. Children’s usually go for the chocolate flavor, while the diet conscious people should choose sugar free flavor to be more healthy and fit. Honey flavor has also targeted some of the areas especially it is consumed more in the winter seasons as a best alternative of pure honey if it isn’t available or accessible. PACKAGING The main idea for changing to a new and innovative packaging is to cope with the changing pace of the world and to bring a new variety, something new and latest. The other reason for switching into a new pack is that there were some fake johanjoshanda’s were started to sell in the interior and lower regions of Punjab and Sindh provinces.
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CHAPTER 5:PRICE PRICING OBJECTIVE The pricing objective is to get the maximum market share. Well it’s not the price that makes QarshiJoharJoshanda market leader, but their quality. Their prices are almost same or little higher than their competitors, but Qarshi spends a large amount of money on Quality Control department to sustain the best of quality which makes them market leader. It’s their procurement department that sends suggestions to top management to set prices. However, government of Pakistan doesn’t charge taxes on herbal products, so this makes a good profit margin despite being a reasonable price of the product. The current price of QarshiJoharJoshanda is Rs. 5 PRICING OF COMPETITORS The prices of QarshiJoharJoshanda is same as of their competitors namely Marhaba, Hamdard and Hashmi. It’s the quality of Qarshi that makes them different from the competitors. FACTORS THAT QARSHI KEEPS IN MIND WHEN SETTING THE PRICE It is the responsibility of Qarshi’s procurement department to determine what prices should be set. They keep various factors in mind, likes of prices of raw material, transportation cost, R&D, quality control, factory expenses, profit margin etc. Recently prices of raw material were increased, so they suggested the top management to enhance prices with a certain profit margin. They import herbs from China and recently because of devaluation of our currency;they were bound to increase their price. MINIMIZATION OF COST Qarshi Industries has a culture of minimizing the cost. Each employee has to calculate his own CPP (Cost Per Person) as to how much he is using resources. According to the formula of CPP CPP is less than 3% CPP is 3-10% CPP is more than 10%
Great performance Average performance Poor performance
EFFECT OF RECENT ECONOMIC RECESSION ON THE PRICE Recession affected Qarshi’s other brands like Jaam e shirin for which they came up with small bottles of 500ml and 1ltr but it didn’t affect JoharJoshanda’s sale because it’s price is very less Rs.5 which is easily affordable. Qarshi’s markup The company didn’t tell their own mark up but we assume that they sell Joshanda to their distributor for Rs. 4.5 and the cost of 1 sachet is Rs. 3 so their mark up should be 11.11% Distributor’s markup Distributor keeps a markup of 5% 24
Retailer’s markup? Retailer also keeps a markup of 5% Break Even Point We assume that the fixed cost of QarshiJoharJoshanda is Rs. 1000000 annually. Fixed cost = Rs. 5000000 Price per unit = Rs. 4.5 Variable cost per unit = Rs. 3 Break even sales units =
Fixed Cost Price per unit – Variable cost per unit
Break even sales units =
5000000 4.5 – 3
Break even sales units = 3333333 units Qarshi can make break even if they sell 3333333 sachets. Break even point in sales = Rs.4.5 x 3333333 Break even point in sales = Rs. 14999998.5 Break even point in sales = Rs. 15000000 approx.
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CHAPTER 6:PLACE COMPANY’S OBJECTIVE FOR PLACE The company’s objective for place is that their brand JoharJoshanda and its variants Chocolate, Pure Honey and Sugar Free should be available at an arm’s length. NUMBER OF CHANNELS Qarshi Industries have 3 Channels namely distributors, wholesalers and retailers. NUMBER OF OUTLETS Qarshi has one international outlet each in UAE, UK, USA, Saudi Arabia and South Africa. Apart from that Qarshi has seven health shops inLahore so that the customers can get free health tips from qualified hakeems, free diet plans, and delivery of all products of Qarshi. NUMBER OF DISTRIBUTORS Their sole distributor is Premier Distributor which is a part of Premier Group. PARTNERSHIP WITH DISTRIBUTOR Qarshi has a good business partnership with their sole distributor Premier Distributors. Premier distributor is a business partner of Qarshi and has links with small distributors nearly 350 in total all over Pakistan. In this way Qarshi can reduce the cost of storage and warehousing. PROBLEMS WITH DISTRIBUTORS Few years back when there were several distributors ofQarshi, they was facing a severe problem with JoharJoshanda. A fake JoharJoshanda was being launched in the interior Sindh and it was being mixed with the cartons of QarshiJoharJoshanda. It was done to bring dis-reputation to Qarshi or devalue the brand image of QarshiJoharJoshanda. Since Qarshi had several distributors, it was not clear as to who was involved in this scam.Qarshi changed their packaging on regular basis so that it will differentiate from the fake one. They also found some of the people who were involved and every distributor was doing blaming others. Then the top management of Qarshi decided that they cancelled the deal with all the distributors and then signed an agreement with only one distributor Premier Distributor so that now if anything like this happens, Qarshi could easily blame Premier distributor. Well that scam has reduced to much extent because Qarshi has changed the packaging. CONTRIBUTION OF DISTRIBUTOR Premier Distributor is one of the top distributors of Pakistan and they have a very wide network all over Pakistan. They make a lot of contribution to add value to the sales of Qarshi products.They have contacts with the sub distributors in order to make the distribution swift and efficient. They also have
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their own warehouses where they store the Qarshi products for backup. They have 1 warehouse in Karachi and 1 in Lahore. KEEPING A CHECK ON THE RETAILERS Qarshihas contact numbers on which retailers can call if they have any issue. Qarshi has an audit department which has the duty that each and every day they have to see whether their products are available in every retail store, whether they have enough shelf space or not. Moreover, if there is an issue with cartons or the sachets are wet or stained or torn then the retailers will tell that directly to the concerned person of audit department. That person will inform the Karachi office as well as the head office whatever he has monitored. Then the management will tackle with this situation. DISTRIBUTORS HELP IN CONDUCTING MARKETING RESEARCH The distributors help in conducting the market researchas they get feedback from the retailers because retailers know which product is in demand so they can tell the distributors and in this way Qarshi gets help from the distributor. ACCESS TO THE PRODUCT Their brand JoharJoshanda Sugar Free is accessible only in elite areas of Karachi like Clifton, Defence, P.E.C.H.S. etc. where the people are very health conscious and have awareness about it. JoharJoshanda Chocolate and JoharJoshanda Pure Honeyare accessible in areas near schools and in majority of the general and medical stores on high demand of children. CONFLICTS WITH CHANNEL There are not many conflicts with the channel because there is only one distributor so the company and distributor sit together to solve conflicts if they arise. MARKUP TO THE DISTRIBUTOR AND RETAILERS Qarshi gives 5% Markup to the Premier Distributor on JoharJoshanda and its variants. Then the distributor gives 2-3% markup to the retailers and there are other seasonal deals so if the retailers buy a big deal then they will get a bigger margin. There are deals of 15 cartons, 25 cartons and 50 cartons.Other additional deals give retailers 1 or 2 cartons free on the purchase of 20 cartons. Moreover, if a retailer purchases Qarshi products worth Rs. 50000 then the retailer gets an instant gift. He gets a scratch card so he scratches it and there can be a number of gifts in or may be the distributor gives a big discount.For example, if a carton is worth Rs. 5700 then the distributor will sell it to the retailer for Rs. 5000.
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CHAPTER 7: PROMOTION PROMOTION OBJECTIVE The promotion objective of QarshiJoharJoshanda is following. Informing – Since the brands QarshiJoharJoshanda Chocolate, QarshiJoharJoshanda Sugar Free and QarshiJoharJoshanda Pure Honey are new so Qarshihas run a promotion campaign that makes potential customers aware of these brands. SETTING THE PROMOTION BUDGET Qarshi set their marketing budget according to percentage of sales method. PROMOTION BUDGET Their annual budget is Rs.350 million PROMOTION MIX Qarshi uses following elements of promotion mix. Advertising Public relations Sales promotions ADVERTISING They made a TV commercial of QarshiJoharJoshanda Chocolate to target the children under 13. The storyboard of TVC The storyboard is that a child says that there are two kinds of kids. One who doesn’t drinkJoharJoshanda Chocolate and the other one who drinks JoharJoshanda Chocolate with milk every day and stay fit. The tagline is “Sehat Fit Maza Hit” DURING OR AFTER WHICH PROGRAMS WAS IT SHOWN? It is shown during cartoons, children programs from 7 am to 8 am and on news channel from 1- 1: 30pm. FEEDBACK OF TVC IN TERMS OF SALES It enhances the sales in the age group of school going student and those groups who are diabeticpatients. TARGET MARKET IN TVC? The target market is the age group (5-12) of school going student. 28
DID THEY TARGET DOCTORS? They didn’t target any doctors yet they did a promotional campaign that they selected a few hospitals and clinics where they gave JoharJoshanda sachets to all the patients so that the patients will try and then if they like they will purchase it from the nearest retailers. WAS THERE ANY WORD OF MOUTH INFLUENCE? JoharJoshanda Sugar Free has had a word of mouth influence because the diabetic patients have tried it and they tell other patients or their relatives to try it because it is really effective. DID THEY ORGANIZE ANY EVENT FOR AWARENESS OR PROMOTION? Yes they conducted research in different schoolswhere they showed different activities like puppet show where the storyboard was that there is a singing competition and one cartoon character has throat infection and so his friend gives him JoharJoshanda Chocolate and he drinks it and then he sings and wins the singing competition. They went to several schools where they gave briefing to the studentsand gave leaflets and goodies to them and after three days they took feedback. In that feedback they found 90% of the students liked chocolate flavor while only 10% students liked honey flavor. As far as JoharJoshand Sugar Free is concerned, Qarshi conducted research in different shopping malls like Forum, Hyderi, Tariq Road and Millennium Mall and they found that the response toQarshiJoharJoshanda Sugar Freewas good in Clifton, Defence and other elite areas of Karachi. PUSH AND PULL STRATEGY First Qarshigo for push strategy by ensuring that their products should be available everywhere.Then they go for pull strategies for which they use print media by giving ads in different magazines like Akhbar-e-Jehan, Sunday magazine and QaumiSehat. In electronic media, they give ads on different channels especially on Cartoon Network, and Nickelodeon, and other channels to create pull. ATL OR BTL PROMOTIONS They have two marketing service agencies namely Adcom and Manhattan Leo Burnett. Adcom takes care of the ATL promotions whereas Manhattan Leo Burnett takes care of the BTL promotions.ATL promotions include the TV and radio advertisements plus billboards. BTL promotions include the activities in schools and shopping malls. PUBLIC RELATIONS Qarshi associates their promotion activities with Geo Tv in Ramadan Iftaar and Sehri transmission with Aamir liaquat. They also use HORICA activities in which they organize programs in hotels, restaurants and cafes of Clifton and Defence during the last 10 days of Ramadan to engage customers in different activaties and they give gifts to the customers.
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CHAPTER 8: PRODUCT LIFE CYCLE PRODUCT LIFE CYCLE STAGE OF PRODUCT CATEGORY Joshanda is in maturity stage because it has been serving for a long time and there are so many compotators like hamdard, hashmi , marhaba although there is tough competition and the price of competitors are same too but the market share of qarshi is 80%. CURRENT PRODUCT LIFE CYCLE STAGE OF JOHAR JOSHANDA CHOCOLATE, JOHAR JOSHANDA SUGAR FREE, AND JOHAR JOSHANDA PURE HONEY All the three brands are in growth stage. Right now they don`t have any competitors because Qarshi has targeted the unmet markets.Qarshi is increasing awareness and interest in the target markets. The market is accepting these brands and the profits are increasing. Children are quite excited by JoharJoshanda Chocolate’s ad so this is a star brand.They are doing intensive distribution. Right now there are no competitors offering these brands or similar brands.
What are your future plans for revitalizing the brands? They will improve the quality. Make these brands as good as qarshi regular.
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CHAPTER 9: RECOMMENDATIONS
Following are the recommendations for QarshiJoharJoshanda’s brands.
Majority of the people are completely unaware of the JoharJoshanda Chocolate, Sugar Free and Pure Honey. JoharJoshanda Pure Honey even in its growth stage is declining so they need to revitalize it. They have not done enough promotion of JoharJoshanda Sugar Free. There is problem in the availability of these brands. They have made only 1 TVC of JoharJoshanda Chocolate which is not shown regularly. They should make separate advertisements of JoharJoshanda Pure Honey and Sugar Free. The packaging is not attractive. They should come up withreadymadeJoharJoshanda Chocolate like Pakola Milk and Milo Since they are targeting the children with Chocolate and Pure Honey, they should create a small animation which would have a storyboard creating awareness of JoharJoshanda. They are relying too much on the distributors. They can go for line extension by bringing more flavors like Mango, Coffee etc. They don’t have any outlet in Karachi.
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