INTRODUCTION Ice cream signifies merriment, joy and happiness and is cherished by people of all age groups all over the globe. Consumers relish this immensely popular year round product with a demand spreading over various social segments throughout the seasons. Ice cream is a source of great merriment and delight with a rich and creamy taste, complemented by the nutritional nature of its ingredients like milk and butter. Keeping a health perspective in prime focus, only a few companies are dedicating their efforts to produce ice cream loaded with fun and nutrition.
Companies have been trying to find new and better ways to market and make their products available to the consumers. Amongst these companies, MAGNUM stands out as an unparalleled provider of value through its enticing array of ice cream flavors in a sumptuous assortment to appeal diversified consumer tastes.
Company Background The recent trend towards maintaining a solid platform by adding novelty imposes a challenge for majority ice cream companies in particular those, which are trying to conform their services to international standards in an erratic business environment. MAGNUM is totally new ice cream Manufacturer Company in Bangladesh. It establishes in 2014 & it believes in ensuring long-term existence by being profitable, successful and sustainable.
Mission “TO PROVIDE QUALITY ICE CREAM FULL OF NUTRITION, FUN & BEST QUALITY BACKED BY A LARGE VARIETY” From the biggest city to the smallest, you will find our ice cream that have made successful. Look anywhere at home or outside around and you will find our ice cream being enjoyed.
Vision To capture the mass market in 2 years. To provide maximum customer satisfactionat a competitive price. Commitment to having a higher level of quality.
Objectives Earn annual rate of return on investment of 15 percent after taxes over the next five years. Produce a net profit of at least TK l,00,00000 by the next three years of operation with a target profit margin of 10 percent on total sales revenue’ of Tk 100000000. Achieve first year total sales revenue of TK4,50,0000, based on an average price of TK.100 per unit. Sell 20 different tropical and Mexican flavored ice cream. Sell other products such as drinks and milk products.
Current marketing situation In Bangladesh there are two types of ice cream producer. One type of producers is producing quality product, considering the demand of upper class people of the society. On the other hand there are some other types of producers who are located in the local areas of Bangladesh considering the demand of the rural area’s low-income people. They are usually habituated having ice cream for TK 1 or 2. So we are mainly targeting former market segment of the society. So, we are analyzing the current marketing situation of the quality ice cream producers.
In ice cream industry, as a leader IGLOO is dominating higher market share of 34 percent, offering 1000000 units of ice cream per year. As a market challenger Polar is dominating 28 percent market share, offering 700000 units of ice cream per year. Ice cream made by other company like Kwality,Belissimo, Zaa n Zee,Milkvita,Bloop(Golden harvest), Quality, Savoy etc. currently account for less than 15 percent market share. In spite of the intense competition, we can rely on our strengths, which are mentioned in the SWOT analysis.
SWOT Analysis Strengths: Availability of capital. Use of modern technology. Financial stability.
Weaknesses: Lack of Brand image as new company Insufficiency in distribution channel management Lack of promotional programs They may suffer from geographical coverage
Opportunities: Increasing demand of ice cream Increasing rate of population Mature retail market in Bangladesh Expanding awareness of people towards quality foods Increasing demand for fast food shop in the city. Availability of raw materials Introduction of advance technology Imposition of higher tax rate on small business enterprise Possibility of economic depression
Threats: Too many ice cream manufacturers in the market Introduction of advance technology Imposition of higher tax rate on small business enterprise Possibilities of economic depression Legislation to reduce number of ice cream factory
MARKETING ENVIRONMENTAL FACTORS The company’s macro and micro factors encircle a vital role in shaping the opportunities & aiding the company to act accordingly. These are the aspects, which are beyond control of any business and must be taken into account. It can be taken as a trend-watcher in the demographic, economic, natural, technological, social-cultural, political-legal areas. All these environments need to be dealt separately before launching or manipulating any variable in the business. Taking our product in account these macro economic factors influence our product as follows:
DEMOGRAPHIC ENVIRONMENT: After analyzing the market MAGNUM see that consumers wanted some extraordinary flavor, different from what all the companies were making. So MAGNUM think of Ripple milk bar topped with tropical and Mexican flavored syrups. This is a very much demanded products category. Ice cream is like by anyone and anybody. For our product we plan to capture both young and old market. Ripple milk bar is portrays family love.
PSYCOGRAPHIC ENVIRONMENT: After thinking of this product the major concern was of WHICH raw materials to be used in the ice cream. Imported tropical and Mexican flavored syrups and local rites. So it is decided that Ripple milk bar would be used because it already has its own market. Apart from that it’s premium syrups, well known for its quality and taste. From psychographic point of view, consumer’s perception of premium syrups was taken into consideration. People are very status conscious so by using Ripple milk bar topped with tropical and Mexican flavored syrups we have provided them the status and quality both.
ECONOMIC FACTORS: By creating Ripple milk bar topped with tropical and Mexican flavored syrups, we are targeting the middle class & upper middle class.
TECHNOLOGICAL FACTORS: Usage of a good & new technology for better quality, day by day technology advances and to keep up with this, the company has to be at its best to compete with its competitors. Magnum has ordered new machinery from Germany to reduce the time it takes to make the ice cream. With the use of new technology the ice cream will be even made in less cost.
SOCIAL-CULTURAL FACTORS: This being a general commodity doesn’t hold any major cultural barriers. Almost every individual desires ice cream. The ingredients would have caused problems if they weren’t halal. Due to good exposure through advertising and other promotions nothing has affected this product.
POLITICAL FACTORS: As businesses are strongly affected by political & legal environment, which encircles changes in laws, government agencies, pressure groups. The milk and syrups are imported from abroad; it may cause some political pressure for Magnum. Although the positive features are that the government is laying a lot of emphasis on locally produced items. Thus Magnum Company has an overhand on this factor. They produce locally, except for that they use imported ingredients!
Marketing Strategy “A well-organized, precise and appropriate plan is sometimes very successful in transforming a business into a very established and profitable one.” Basing on point of differentiation, effective market segmentation and determination of target market the organization sets its product, price, placement and promotion strategy, which ultimately enable the organization to achieve its goals. Magnum try to manage three levels of plans – the short-term, medium-term, and long-term plans.
LONG-TERM PLANS:
1. 2. 3. 4. 5.
To become one of the market leaders in the ice-cream industry. To gain goodwill. To expand its business domestically and internationally. To ensure long-term existence by being profitable, successful and sustainable. To make a worthwhile contribution to progress of the nation.
MEDIUM-TERM PLANS:
1. 2. 3. 4.
To provide the best services and highest quality products. To respond effectively to the market demand. To survive in the market by increasing profitability and growth. To gain competitive advantage and to increase market share.
Moreover for ensuring the fulfillment of the overall company strategy, it focuses on a wide range of facilities in order to motivate employees, distributors and retailers to increase their performance.
Short –Term Plans 1. To introduce a more innovative range of ice cream. 2. To achieve responsiveness to the changing taste buds of the consumers crucial for survival in a highly competitive market. 3. To maintain their current level of profitability and efficiency. 4. To import quality raw materials from abroad. 5. To keep stocks of raw material so as not to hinder production.
Positioning strategy: Consumers typically choose products and services that give them the greatest value. In that sense Magnum has decided to use more for less positioning strategy. It will introduce better quality product at comparatively lower price for a given level of performance. Magnum claims that its Ice milk provides the best tent and everyday low price. It likes to position as a testy and super saver for all family and individual users.
Target Market: Magnum Ice Cream Factory’s strategies of segmenting and targeting the market by identifying the customer’s needs, designing and positioning of the product to fulfill the needs are discussed:
MARKET SEGMENTATION Personal Characteristics Age Gender Education
Marital status Social class Occupation
Psychographics Interest Opinions
Personality
Behavioral Occasions Benefits
Usage Rate
12-50 years. Male, Female. Going to or went through High school and college education. Single, Married. Middle & Upper middle class. Students, professionals, career people.
Family Having fun, friends and good time. Under western influence, considers top of the line products friendlier and want unique things. Independent, extrovert, friendly, expressive, fun loving, INNOVATORS.
Eids, Birthdays, Anniversaries, Special days. Convenience, positive feelings, creation of bond, relationships. Light to medium Users.
Attitude Towards product Readiness Toward Product
Enthusiastic, Positive. Interested, intending to buy.
Geographical Region City Density
All. Concentrated in all Divisions. Urban & Rural.
Product management: Raw Ripple milk will be packed in an air and heatproof box, mug, cup or bowl. Finished bar will be stored in freeze with great care until served to the customers. A spoon will be given within the box for easy use. As all the existing ice creams are melted when they come with the heat, so to solve this problem is used chemical which makes it intact until consumption. Main products to be sold through the Magnum will be ice cream topped with tropical and Mexican flavored in three main sizes: small, medium, and large.
Product description (Raw materials): One major product will be sold through Magnum ice cream which will include Ripple milk bar topped with tropical and Mexican flavored syrups Twenty different tropical and Mexican flavored syrups will be sold and include the following(Raw materials): Wild Watermelon, Pina Colada, Pint Lemonade, Cherry Jubilee, Root Beer, Kiwi, Strawberry, Blue Bubble Gum,Raspberry Red, Luscious Lime, Bodacious Banana, Tamarind, Jamaica, Hortacha, Melon, Papaya, Manzana, and Limon. Ripple milk bar will be manufactured in an automatic machine imported from Germany. Ingredients included in the Ripple milk bar are: Flavor, syrup, sugar, vegetable fat, milk fat, food grade color and milk solids.
Pricing Strategy: Magnum will use cost based pricing strategy. In case of cost plus pricing it will add a markup to the cost of the product. Different prices for different bar. In market consumers will be offered three sizes Ripple milk bar such as small, medium and large. Magnum will be offered at the following prices: Small TK 65 Medium TK 120 Large TK 200
Distribution Strategy: Magnum will be used marketing intermediaries to bring Ripple milk bar to market. It will use a distribution channel like: In the city area Magnum will sell Ripple milk bar by using small pickup van for commission basis. Major marketing will be conducted through newspaper, magazine advertisements, TV ads. and local retail shop distribution during the first three months of operation.
Sales strategy: Sales strategy will be directly linked to marketing programs since all sales will be through the business facility only. Consumer sales will start in October 2014 (or sooner if construction is completed before the targeted date) with a grand opening anticipated by then. Marketing communication mix includes advertising, sales promotion, personal selling, public relation and direct marketing .In that sense Magnum will create an advertising campaign to build brand awareness and differentiate the product from competitors, use trade promotion to support distribution strategy, and develop a high profile product launch strategy to generate publicity and media coverage. Magnum has conducted a marketing research for understanding the market situation of ice cream. It will also conduct marketing research to measure brand awareness before, during and after marketing campaign, study consumer satisfaction and identify opportunities for future product development efforts.
