TASK 2: Product Introduction Sooriya Products “Rice Murukku”
Until foreign forces invaded our fair isle, we were a nation second to none because we were self sufficient in our staple food, rice. Rice was not only our staple food but was also the base for many a short-eats and sweetmeats. With the commencement of the foreign market forces, the degradation and regression of our nation started with the introduction of imported rice in place of our own, wheat flour, and milk powder of multi-nationals that made us mal-nourished and lethargic. lethargic. For example, many countries in the world, when they change their consumption from grain into wheat flour in creating variety of foods, have eventually received the gift of malnourishment. his culture of using using wheat flour for the consumption is implemented implemented in the countries where they grow wheat. !ut in other countries where there are another local grains are used, a "Wheat based #ulture$ is a disaster. %ikewise in &ri %anka where surplus rice production is in form, and where the main source source of nourishment had been the "Rice !ased #ulture$ this W!# 'i.e. wheat based culture( has knell the toll for the rise based products. here are only a few nations that have an ample, staple food of their own. )ven *ndia with its highly developed agric-industry, does not possess to have self-sufficiency in its staple food. !ut we can proudly say we have a national, staple food and that is rice. +t least twice a day we consume rice. Rice is our main source of nourishment. Rice is our life. *t is very high in nutrition. *t is healthy and builds up strength and vitality. *t is environmentally friendly and humane. *t is a national blessing that from recent times there is a trend to look up to our locally manufactured products with respect and regard, in spite of people going for wheat flour products as a fashion. any a locals have now thoroughly thoroughly understood the value and the nourishment of the local rice products herefore, considering the present situation, there is a new trend being designed for fast foods made out of rice flour in &ri %anka. his is due to the growing demand for fast foods which are very healthy since a person has got health conscious. riven by this demand for /ealthy Fast Foods0 , many a companies have emerged to supply the growing need of the people with many a Rice based products. +ccording to above situation, &ooriya 1roducts have launched "Rice urukku$ which will substitute wheat based unhealthy murukku which is now in the market. &ooriya 1roducts is made from 2334 local rice flour. herefore it was named ""Rice urukku$.his &ooriya Rice urukku is proven very healthy and a nd it is even good for children and elderly. elderl y. *ngredients used for this product is 2334 local and &ooriya company have uplifted the lives of many a local farmers by purchasing their rice products directly without using a iddle an.
“Sooriya Product” (Pvt) Ltd
"&ooriya 1roduct$ will produce manufacture, package and distributor of local food products. "&ooriya 1roduct$ will be an *ndigenous appreciates and environment-friendly company dedicated on sustainable development and corporate social responsibility, as a service to society and preservation of nature. "&ooriya 1roduct$ is going to make the best 5uality Rice products from using the best local ingredients. Rice 1roducts will go to make, with using advanced technology and many different flavors for utmost customer satisfaction. "&ooriya 1roduct$ head5uarter will be situated in 6atunayake.
Mission
"o be a leading producer of fast food based on dedication to nature, corporate and process /ygiene, dynamic leadership and commitment to our partners and stakeholders.$
Vision
"o be &ri %ankan 1remier fast food #ompany, offering nutritious 7 superior 5uality tasting foods to its consumers. !y 8329 we aim to achieve :34 of arket &hare, and while doing it we would be the best in terms of consumer value, customer service, employee talent, and consistent and predictable growth.
Te stren!t o" Sooriya #roducts “Rice Murukku” •
1resent rice production in &ri %anka is around ;.9 million < and this industry sustains about
•
993,333 farmer families. =ear round price-stability for local rice will be an incentive and assurance for our rice farmers
•
ameliorating their living standards. >etting the general public use to eating rice-urukku in place of more familiar wheat flour
•
urukku will substantially reduce the import of wheat flour thereby saving foreign exchange. ?ne of the main reasons for diabetes, a ma@or health haAard we &ri %ankans are facing today is
• •
due mainly to the consumption of wheat flour. *t will be a revolutionary pro@ect to free us from the present servile economy. +t the same time it will be the beginning of a new food culture. '&&(
2$% &o a 'icro and 'acro environ'ent anaysis "or your #roduct .
Macro nviron'ent )conomic Factors &ocial and #ultural Forces
echnology emographic Factors
Micro nviron'ent
arket &uppliers arketing *ntermediaries
#ompetition 1olitical and %egal Forces Ta*e 2: Micro and Macro environ'ent (*y autor)
Micro nviron'enta Anaysis
icro environment covers the internal factors which influence the operations of organiAations. B&ooriya products$ is influenced by its internal factors .he internal factors are&uppliers
1ublics
#ompetitors
*ntermediaries
#ustomers
Su##iers
B&ooriya products$ has own suppliers and its practices very close relationship with suppliers. B&ooriya products$ divides its suppliers into two divisions who are called direct suppliers and indirect suppliers. he indirect suppliers deliver the ingredients to the direct suppliers and the direct suppliers produce the food for B&ooriya products$. B&ooriya products$ understands the importance of its suppliers and always co-operates with professional manners. 'aboutmcdonalds.com( +o'#etitors
+s the local market is highly competitive, B&ooriya products$ has some strong competitors, for example, wheat flour products, /arischandra foods and Raigam foods, etc. all competitors have good brand image, remarkable market share, long business history and so on. *n this competitive situation, B&ooriya products$ needs to consider its competitorsC power to ensure its dominating position.
+usto'ers
B&ooriya products$ is serving thousands of customers daily. +ll people are targeted as customers by B&ooriya products$. *t serves foods for almost every kind of people. B&ooriya products$ takes the customers as their first priority and tries to ensure maximum satisfaction. Te Pu*ic
he public includes the external groups who are interested and related with the company. B&ooriya products$ works with considering the power and importance of different groups, for instance, local government, financial community, edia, consumer group, farmers and so. Inter'ediaries
+s the business operation of fast food chain is different from other hospitality organiAations like a hotel or airlines or tour operators, the intermediaries are not re5uired in this case. o promote the business, promotional activities are normally done by the company and every restaurant works at its distribution center. Macro environ'enta anaysis
Factors that affect the internal environment, acro analysis is also known as PSTL analysis, which stands for1olitical factors
echnological factors
)conomical factors
&ocial factors
)nvironmental factors
%egal Factors
Poitica "actors
1olitical #onsists of laws, government agencies and pressure groups that influence or limit various organiAations and individuals in a given society. '6otler, 8328( he business operation of an organiAation is always influenced by the policies of state and its government. "&ooriya 1roducts "!usiness is also under the control of a government0s rules and regulations. he main issue of controlling food business is health, and other issues are license, employee laws, and tax issues, etc. "&ooriya 1roducts follows the local government0s policies as well as foreign
investment policies on its franchise business strategy. 1olitical instability of local state is also affected "&ooriya 1roducts "business.
cono'ica "actors
)conomical factors always come as a vital issue for business organiAations. he local economical condition is also responsible for affecting "&ooriya 1roducts "operation. *f the local economy is critical, people are usually discouraged to spend more money for their fast food. +s a result, the company is affected. Socia ,actors
he lifestyle of people is being changed and the demand of this change affects "&ooriya 1roducts ". he people of this modern urban society expect the highest level of service and all the latest facilities from a hospitality organiAation. *n addition, this changing demand is different in society to society and country to country. For example, uslim people avoid pork. o fulfill the customers0 expectation, "&ooriya 1roducts "needs to research the market and also needs to provide an effective food menu. Tecnoo!ica "actors
Dew technologies create new products and new processes. echnology can reduce costs, improve 5uality and lead to innovation. hese developments can benefit consumers as well as the organiAations providing the products. '?xford Universit y 1ress, 833E( he impact of technological innovation is also considerable to meet the customers0 expectation. +s all existing food chains for instance, "&ooriya 1roducts "has to ensure the all technological access to influence the customers. odern and speedy distribution channels, easy and 5uick payment facility. nviron'enta ,actors
here are minimum harmful elements effects from "&ooriya 1roducts ".for example, food packaging based on polystyrene.
Le!a ,actors
*t is mandatory to follow some rules and procedures to run its operations. For example, registrations, taxes, stuff laws, safety rules, etc. *f every company maintains the legal process, not only the company itself, but also every part of our society will be benefited. B&ooriya products$ as a small food company, has to be responsible regarding legal issues.
2$2 Identi"y te se!'entation criteria tat can *e used "or your #roduct
arket segmentation is mass selling, in which the vendor engages in the mass production, bulk distribution, and mass promotion of one product for all buyers. *t is thought that mass marketing creates the largest potential market, which leads to lower prices, which in turn can contribute to lower prices or higher gross profits. &imply, many critics point to the increasing splintering of the marketplace, which creates this procedure difficult. &ome claim that mass marketing is dying. ost societies are turning to micro marketing at one of ; points (%) Se!'ent Marketin!:
+ market segment consists of a group of customers who partake in a standardiAed set of needs and desires. he marketer does not produce the sectionsG his task is to identify the segments and decide which one to target. he segment market offers key benefits over mass marketing. he company can deliver better design, price, and deliver the product or service to satisfy the target market. (2) -ice Marketin!:
+ niche is a more narrowly defined customer group seeking a distinctive mix of benefits. +n attractive niche is characteriAed as follows a( he customer in the niche has a distinct set of needs. b( hey will pay a premium to a firm that best satisfies their needs. c( he niche is not likely to attract other competitors. d( he niche gains certain economies through specialiAation. e( he niche has siAe, profit and growth potential.
(.) Loca Marketin!:
arget marketing is leading to a marketing program tailored to the needs and wants of local customer groups. %ocal marketing reflects a growing trend called grass root marketing. arketing activities concentrate on getting as close and personally relevant to individual customers as possible + large part of local
(/) Individua Marketin!:
he ultimate level of segmentation leads to one-to-one marketing. oday, customers are taking more individual initiative in determining what and how to buy they log on to the internet, look up information, dialogue with suppliers
he marketing concept calls for understanding clients and meeting their needs better than the competitor. !ut different clients have different needs, and it rarely is possible to fulfil all customers by treating them alike.
,i!ure %: Market0 Se!'entation0 &ia!ra'
Se!'entation in te "ood 'arket
#onsumers differ widely in their particular needs, motivations or preferences and buying capacity. ?ne supplier cannot provide one product suitable for the entire market. +lternatively, one supplier cannot provide a wide enough range of products to suit each individual consumer0s needs within the market. /owever, the consumer market can be segmented into groups who share similar characteristics or purchasing needs. his allows suppliers to create different products which would suit different consumer needs according to their age, income, taste, lifestyle, health or beliefs. #urrently three growth trends include health, convenience and indulgence. #onsumers will often buy products which meet all three needs during a shopping occasion ?ther growth trends include consumer ethics. •
Fair rade
•
+nimal Welfare
•
&ustainability
•
1rovenance
•
Huality schemes
Indulgence – for people to treat themselves
,i!ure 2: Se!'entation in te "ood 'arket
Market Se!'entation
arket segmentation is the process in marketing of dividing a market into distinct subsets 'segments( that behave in the same way or have similar needs •
Iariables Used for &egmentation
–
2( >eographic variables
–
8( emographic variables
–
:( 1sychographic variables
–
;( !ehavioural variables !elow are the arket &egmentation Iariables according to the Dew "&ooriya 1roduct$ can be use.
1eo!ra#ic varia*es
>eographic segmentation calls for dividing the market into different geographical units such as nations, states, regions, counties, cities, or neighborhoods. •
!y leveraging the benefits of liberaliAation and integration of the markets of the world,
•
Will seek to serve both domestic and international customers.
•
etropolitan #ities, ma@or cities
•
ensity of +rea Urban, &emi-urban, and Rural.
•
#limate warm
&e'o!ra#ic
*n demographic segmentation, the market is divided into groups on the basis of age and the other variables in bellow points. ?ne reason this is the most popular consumer segmentation method is that consumer wants, preferences, and usage rates are often associated with demographic variables. +nother reason is that demographic variables are easier to measure. •
+ge J all age group
•
>ender J !oth ale and Female
•
Family siAe - doesn0t matter
•
)ducation - doesn0t matter
•
*ncome J middle 7 hi end consumer
•
?ccupation J doesn0t matter
•
nationality
•
language - doesn0t matter
Psyco!ra#ic
1sychographic segmentation groups customers according to their lifestyle. +ctivities, interests, and opinions '+*?( surveys are one tool for measuring lifestyle. &ome psychographic variables include. •
1ersonality
Do
•
%ifestyle
=es
•
Ialue
=es
•
+ttitude
=es
eavioura se!'entation
*n behavioural segmentation, buyers are divided into groups on the basis of their knowledge of, attitude toward, use of, or response to a product. any marketers believe that behavioural variables occasions, benefits, user status, usage rate, loyalty status, buyer-readiness stage, and attitudeKare the best starting points for constructing market segments. !ehavioural segmentation is based on actual customer behaviour toward products. &ome !ehavioural variables include •
benefit sought
•
product usage rate
•
brand loyalty
•
profitability
•
income status
-ice 'arket
&ome product lines are not sold in large 5uantities, but are considered financially viable as they fill a special gap or niche0 in the market. + niche market0 is not created, but identified by segmenting the market into groups of consumers with a specialised need or want which can be identified by monitoring consumer purchasing or demand. &ometimes the opportunity arises for a retailer to increase margins by developing a new range. + recent trend where consumers are developing a greater interest in the way products and packaging are made, has led to many manufacturers responding by producing organic or farm assured ranges of food products. )xample is "&ooriya 1roducts$ target groups are nationalist group and health conscious people.
2$. 3#ain a*out your tar!et 'arket usin! di""erent tar!etin! strate!ies$
?nce the firm has identified its market-segment opportunities it has to decide how many and which one to target. arketers are increasingly combining several variables in an effort to identify smaller, better-defined target groups. )ffective segmentation criteria Dot all segmentation schemes are useful. arket segments must rate favourably on L key criteria '2( easurable the siAe, purchasing power, and characteristics of the segments can be measured. '8( &ubstantial the segments are large and profitable enough to serve. ':( +ccessible the segments can be effectively reached and served. ';( ifferentiable the segments are conceptually distinguishable and respond differently to different situations. 'L( +ctionable effective programs can be formulated for attracting and serving the segments. 4usti"y 5y you ave seected tat strate!y:
*n evaluating different market segments, the firm must look at two factors '2( he segment0s overall attractiveness. '8( he company0s ob@ectives and resources. First, the firm must ask whether a potential segment has the characteristics that make it generally attractive, such as siAe, growth, profitability, scale economies, and low risk. &econd, the firm must consider whether investing in the segment makes sense given the firm0s ob@ectives and resources.
Sin!e6Se!'ent +oncentration
any companies concentrate on a single segment. hrough concentrated marketing, the firm gains a thorough understanding of the segment0s needs and achieves a strong market presence. Furthermore, the firm en@oys operating economies by specialiAing its production, distribution, and promotionG if it attains segment leadership, it can earn a high return on its investment. /owever, concentrated marketing involves higher than normal risks if the segment turns sour because of changes in buying patterns or new competition. For these reasons, many companies prefer to operate in more than one segment.
Seective S#eciai7ation
/ere the companies selects a number of segments, each ob@ectively attractive and appropriate. here may be little or no synergy among the segments, but each segment promises to be a money maker. his multi-segment coverage strategy has the advantage of diversifying the firm0s risk. Product S#eciai7ation
+nother approach is to specialiAe in making a certain product for several segments. hrough a product specialiAation strategy, the firm builds a strong reputation in the specific product area. he downside risk is that the product may be supplanted by an entirely new technology. Market S#eciai7ation
With market specialiAation, the firm concentrates on serving many needs of a particular customer group. For example, you might be supplying all types of sporting goods to sporting goods stores 'e.g. soccer, tennis, snowboards, etc.(. he firm gains a strong reputation in serving this customer group and becomes a channel for further products that the customer group could use. /owever, the downside risk is that the customer group may have its budgets cut. ,u Market +overa!e
/ere a firm attempts to serve all customer groups with all of the products they might need. ?nly very large firms can undertake a full market coverage strategy. )xamples include *! 'computer market(, >eneral otors 'vehicle market(, and #oca-#ola 'drink market(. %arge firms can cover a whole market in two broad ways through undifferentiated marketing or differentiated marketing.
Accordin! to te a*ode strate!y “Sooriya #roduct” mostly related with 1roduct
&pecialiAation “Sooriya #roduct” is to specialiAe in making a certain product for several segments. For
example, a “Sooriya #roduct” distributor might sell Rice urukku to a retail store chain, to a number of /otels, !its shops, and even direct to the end consumer 'through an online store(.
Reasons "or “Sooriya #roduct”
Food is an essential aspect for maintaining life. Rice in particular provides many nutrients essential for life. *n &ri %anka MM4 use this for day to day life. he purpose for developing new Rice urukku products could be due to •
• • • •
+ gap in the market, e.g. which will substitute wheat based unhealthy murukku which is now in the market Dew consumer pressures, e.g. economic crisis rop in customer loyalty or loss of market share Dew ideas or technology +n emerging consumer demand, e.g. indigenous products, health or indulgence.
2$/ &e'onstrate te *uyer *eaviour "or your ne5 #roduct and o5 *uyer *eaviour can a""ect your activities .
+ consumer0s buying behaviour is also influenced by social factors that include small groups, families, social roles and status. '6otler, 8328( >roups can influence a purchase by means of opinion giving by word of mouth or online social networks. Family !uying !ehaviour refers to how the target market decides to make a purchase, choose among items and identifying what influences their purchases here are four characteristics affecting consumer buying behaviour 2. #ultural Factors #ulture is the most basic cause of a person0s wants and behaviour. '6otler, 8328( "&ooriya product$ has identified which Factors are in demand to the present generation0s choice. Foods are everywhereG 1eople who are and will be interested in local and good healthy products are inevitably many in number 8. &ocial Factors embers strongly affect the consumer behaviour. Recent times there is a trend to look up to our locally manufactured products with respect and regard, increasing number of 1atriotism people :. 1ersonal Factors 1hilip 6otler identifies personal characteristics such as age and life-cycle stage, economic situation, and personality and self-concept that influence a buyer0s decision. *n Recent times *ncreasing health consciousness and need for convenience healthy food. ;. 1sychological Factors
he psychological factor affecting buying behaviour is furthermore subdivided into four ma@or psychological factors N otivation J a motive or drive is a need that is sufficiently pressing to direct the person to seek satisfaction. '6otler, 8328( N 1erception J the process by which people select, organiAe and interpret information to form a meaningful picture in the world. '6otler, 8328( arketers need to exert an extra effort to attract customers by delivering advertising messages, affect how they already believe, and make the customers remember them on top of other competing brands. N %earning J *ndividual experience tend to affect how a person act through learning. he diagram below shows the buyer behaviour applied in different buying situations of customers
,i!ure .: Maso58s 9ierarcy
2$ Identi"y o5 you can #osition your #roduct$
he marketing mix helps to define the marketing elements for successfully positioning market offer. ?ne of the best known models is the ;1s of arketing, which helps to define marketing options in terms of product, place, price and promotion. Use the model when you are planning a new venture, or evaluating an existing offer, to optimiAe the impact with your target market
,i!ure / te 'arketin! 'i3
1ositioning involves identifying a set of differentiating competitive advantages and choosing the right competitive advantages among these. he company must build its own position in the market that will last longer by creating differentiation among other competitors. *t has to make an impact that can make it stand out in the market. •
"&ooriya 1roducts$ offers local food manufacturer that separates it from other potential competitors.
•
>ood healthy Rice products and impact to its target market + gap in the market, e.g. wheat flour food products
•
•
Dew ideas +n emerging consumer demand, e.g. indigenous products, health or indulgence he ;1s are o
1roduct 'or &ervice(.
o
1lace.
o
1rice.
o
1romotion.
Product - Rice urukku is a Fast food it0s made by 2334 %ocal Rice flour which will be
produced and marketed by the &ooriya 1roducts %td. !rand Dame is "Rice urukku$. /owever, customers0 re5uirements change over time. *n order to meet these changes, ifferent taste 'hot, sweet, chickenO.( ifferent shapes and ifferent siAe. Product Li"e +yce
?ur product lies in an *ntroduction 1eriod of 1%# o
%ow sales
o
/igher costs per customer
o
Degative profits
o
*nnovator customers
o
Few competitors
o
?b@ective o create awareness of the product
o
?ffer a basic product
o
1rice at cost-plus
o
&elective distribution
o
+wareness J dealers and early adopters
o
*nduce trial via heavy sales promotion
,i!ure : Product Li"e +yce Pace - 1lace, as an element of the marketing mix, is not @ust about the physical location or
distribution points for products. *t encompasses the management of a range of processes involved in bringing products to the end consumer. o
"&ooriya 1roducts$ they used outsourcing rice flour for their products .hen they manufacture and packaging of Rice urukku, under "&ooriya 1roducts$ brand.
o
Use red and white rice flour for the product.
o
Rice flour would be purchased from local farmers
o
ode of ransport Road ransport
Price - he customer0s perception of value is an important determinant of the price charged.
#ustomers draw their own mental picture of what a product is worth. + product is more than a physical itemG it also has psychological connotations for the customer. he danger of using, low price as a marketing tool is that the customer may feel that 5uality is being compromised. *t is important when deciding on the price to be fully aware of the brand and its integrity.
o
+s a newcomer "Rice urukku$ pricing strategy is to introduce our products in the market at lower prices so as to create huge demand in the market and then compete with other competitors.
o
+s we come up in the demand, we will increase our prices and will provide more efficient and affordable Rice 1roducts.
1enetration 1ricing o
?ur product will be lying on penetration strategy with high 5uality 7 low price
o
For introducing new product
o
1rice low to capture market share
o
)xpect to make profit in volume
,i!ure ;: Pricin! strate!y
Pro'otion - he promotions aspect of the marketing mix covers all types of marketing
communications ?ne of the methods employed is advertising, +dvertising is conducted on I, radio, in cinema, online, using poster sites and in the press for example in newspapers and magaAines. ?ther promotional methods include sales promotions, point of sale display, merchandising, direct mail, loyalty schemes, door drops, etc. •
he skill in marketing communications is to develop a campaign which uses several of these methods in a way that provides the most effective results. For example, I advertising makes people aware of a food item and press advertising provides more detail. his may be supported by in-store promotions to get people to try the product and a collectable promotional device to encourage them to keep on buying the item.
•
"&ooriya 1roducts$ mainly focus is on nationalist group and health conscious people, We can *ncrease nationalist advertising by using I and Radio #ommercial.
•
+t "&ooriya 1roducts$ the prime focus is on targeting children. *n happy meals too which are targeted at children small toys are given along with the product.
•
+s we are in the *ntroduction phase, our ob@ective is to create brand awareness through *nformative +dvertising.
•
Use of 1rint edia, Radio +dvertisement, /oardings in 1ublic &pots, &le istribution, ?rganiAing )vents, I #ommercial etc.
•
ie Up with ma@or #inema halls to promote our products during *ntervals.
•
*n-film advertising, in its most effective form, is about a brand being a part of the cinemaCs content
•
Web arketing
•
&ocial Detworking *n order to reach out to the + and ensure that they feel more connected with the brand it is necessary to start making conversation. !y using face book and twitter we can create a community and Fan page
,i!ure <: Pro'otion trou! PL+
