Company
Shreeji Enterprises Pvt. Ltd will be entering the food processing industry with its first launch i.e. a Kiwi fruit juice.
Three of the four investors have full operational responsibilities. SD and SY are the co-founders and have both entrepreneurial and industrial experience. PB brings operational management and financial skills to the operation.
Shreeji Enterprises Pvt. Ltd has a Strategic Alliance with the New Zealand based company Zespri International Limited to supply the kiwi fruits to India. Pursuant to our company policy stating "Quality First, Credit Prominent", we process our KiwiJoos with strict production standard, quality control and sophisticated processing technology, we at all time provide our consumers the natural and healthy Kiwifruit juice.
Our Start up costs, listed below, has been financed to date by the investment from its owners. Following are the parameters:
| Particulars | Amount |
| Land & site development;[x[ acres @ Rs. [y] lakh per acres | xxx |
| Building and civil works | xxx |
| Plant and machineries | xxx |
| Miscellaneous Fixed Assets | xxx |
| Preoperative expenses | xxx |
| Preliminary expenses | xxx |
| Technical know-how and engineering fees | xxx |
| Contingencies @ 10% | xxx |
| Capital Expenditure | xxx |
| Margin money for working capital | xxx |
| Project cost | xxxx |
Market Analysis
Market Analysis Summary:
One can sense an evolution that the industry has seen with development in the tetra- pack market, there also has been a natural progression from drinks to nectars to juices and while traditionally fruit drinks were aimed at children, the new brands like ‘Onjus, Real, and Life’ have focused on young adults and professionals.
Although fruit drinks focus strongly on out of home consumption, the juices and nectars have been concentrating on takeaways or in-home consumption with more choice coming in, the tetra- pack market is likely to witness further segmentation.
Packaged fruit juices are getting recognized as social drinks now, with dominant consumption being observed in the company of family and friends. People have started to perceive fruit juices as anytime beverages, with consumption being spread more or less evenly between the mid mornings, afternoons and evenings. And generation now is as much inclined to sipping fruit juices as colas, with teenagers driving the maximum trials.
If the findings of a usage and attitude study conducted by market research agency Indica Research across 1200 adults in Sec A and Sec B households in Delhi and Mumbai are anything to go by, then its not just champagnes and colas that qualify as social beverages.
The results of the research can be briefly put as follows:
· Among packaged fruit beverages, the ‘awareness to trial, ratio of PepsiCo’s Tropicana juice brand has been rated the highest. Up to 17% of the respondents were aware of Tropicana, while the brand’s trial stood at 11%, also, 8% of the respondents stocked the brand at their homes. Other parameters where Tropicana edged out competitors included taste, health, purity and nutrition, according to the study, Tropicana was also perceiver as ‘reasonably priced’.
· The average Indian may have a legendary weakness for mango, but when it comes to preference of fruit-based juices; his choices are in tune with international trends. Therefore it is orange juice that is the most preferred fruit juice flavour in India, followed by apple, sweet orange and mixed fruit.
· The findings indicate that most packaged juice drinking consumers travel abroad on holidays.
· Other attributes of branded juice consumers include employment of domestic help, ownership of assets and credit cards, and health consciousness with 80% respondents going to aerobic classes or working out at gymnasiums.
· Understandably therefore, awareness and trial levels of packaged juices are higher within the Sec A category, than among Sec B consumers, the majority of whom rated these as aspirational.
· Awareness levels are similar in both Mumbai and Delhi; more trials are generated by Delhities than their counterparts in Mumbai.
· The consumers are starting to perceive fruit juices at home. While 55% of the respondents consumed 1- litre packs at home, 45% consumed 200ml packs.
The fruit beverage market has more acceptances in Northern and Western India, which is due to the climatic conditions prevailing there with relations to the rest of the country.
Market Segmentation:
There has been no general acceptance of the product forms in the fruit beverage market. The consumer is basically concerned if it is a fruit juice or synthetically constituted product. Product segmentation, therefore, should be clearly delimited.
· Under the fruit drinks the first segmentation is between real fruit drinks and synthetic drinks.
§ The real fruit drinks are based on natural fruit pulp or juice.
§ The synthetic drinks are synthetic products with fruit or other flavors.
· Broad taste preferences could be another way to define the market. The market is at present also segmented on the basis of fruit pulp content. For the purpose of segmentation, on the basis of fruit pulp content. For the purpose of segmentation, on the basis of fruit pulp content, market can be segmented as:
§ Fruit juice with pulp content more than 80%. Brands falling in this category are Onjus, Real, Tropicana, etc.
§ Fruit Nectar with pulp content between 40% to *0%. Life and X’s come in this category.
§ Fruit Drinks with pulp content less than 40%. Frooti and Jumpin are the popular brands in this category.
· Segmentation could also be on the basis of the benefits provided to the consumer:
§ One benefit could be the nutrition content it gives to the consumer so one market could be the health-conscious segment.
§ Second benefit is thirst quenching, so the other segment could be those buying the drink or nectar for satisfying the thirst.
· Another very broad segmentation can be on the type of situation in which the drink or nectar is used:
§ People who are on the move i.e. Outdoor use e.g. those traveling.
§ People who are using it on the breakfast table as a part of their menu i.e. in-house use.
Players very often choose one or more of such segmentations to differentiate their product and target market and accordingly plan their distribution and promotion patterns.
Market Needs:
Consumers usually, are not going to accept something that doesn’t taste good even if it is good for them or has certain benefits. Companies working to bring a new food product to the market have two questions—does it taste good and will consumers buy it?
Market Trends:
Tropical fruits and flavours dominate the market, yet some consumers are still hesitant to try unknown exotic flavours like cherimoya, guanabana and carambola. Companies have found the best way to introduce exotics is in combination with familiar flavours. A flavour combination that began in the new age, 5% to 10% juice category, and has spread to other beverage categories as well as to other products like kiwi, strawberry, etc. stating that it was a small company that took the risk and won.
Smaller companies lead the way, as they are more willing to try exotic flavours even though the larger companies have a larger staff and budget, and can afford to search out the trends. The large companies tend to introduce prototypes that are pretty well-tested. They are always interested in the next flavour trend, but usually are not the first to debut it.
Fortified drinks are also gaining market i.e. the juice is processed and an additional nutritious trait is added to enhance its wholesome value e.g. with additional calcium, vitamin C etc.
One can notice the population in the country mainly in the cities becoming more and more aware with regard to the nutritional aspect of life. This knowledge, coupled with the consumer’s desire for a healthier lifestyle, has greatly impacted the evolution of juice and juice-based drinks over the last few years.
Industry analysis:
The Rs 100 crore packaged fruit juice market is estimated to be growing at 20% to 25% annually, with Tropicana and Real holding 40% market share each.
The market can be categorized in terms of product content and there are three major product contents available.
· Drinks: Juice with pulp content less than 40%,
· Nectars: Juice with pulp content between 40 - 80%,
· Juices: Juice with pulp content more than 80%,
The canned juice market initially covered brands like NAFED, Noga, Midland, Gold Coin and Druk. These were fruit juices and nectars and not drinks. But they did not make a mark in the market due to reasons such as high price, unattractive packaging and lack of right promotion programme.
Parle Agro’s Frooti, a mango drink, was introduced in the tetra pack in 1985 and since then has been a leader in its segment. The market has suddenly picked up since 1994-95 and a few players have emerged as market leaders.
Leading Manufacturers of Fruit Beverages in India:
| Company | Brand | flavours |
| 1. Parle Agro | Frooti | Mango, Guava, Pineapple, Strawberry & Orange |
| Appy | Apple | |
| 2. PepsiCo Ltd. | Tropicana | Orange, Nature Sweet, Apple, Grape, Pineapple, Tomato, Mixed Fruit. |
| Slice | Mango, Litchi, Orange & Guava. | |
| 3. Dabur | Real | Grape, Guava, Orange, Pineapple, Tomato, Mixed Fruit, Litchi, Mango. |
| Real Active | Orange, Apple | |
| 4, Godrej Foods | Jumpin Re Xs | Orange, Apple Orange, Apple Orange, Apple |
| 5. Coca Cola | Maaza | Mango |
| 6. BBI. II | Tree Top | Mango |
| 7. Voltas | Volfruit | Mango |
| 8. Hindustan | Grapy | Red Grapes, Litchi, etc. |
| 9. HP Agri | HPMC | Apple Marketing |
| 10. North East Agro Mkt. Ltd. | NERAMAC | Pineapple |
| 11. Kerala Milk Mkt. | Milma | Mango, Pineapple |
| 12. Salstar Foods | Regold | Mango, Apple Mixed |
| 13. Mohan Meakins | Gold Coin | Apple Juice |
| 14. Modern Foods | Rasika | Mango, Guava |
| 15. Eastern Fruit | Efil | Mango, Litchi |
| 16. NAFEED | Nafed | Apple, Mango, Processed Guava, Pineapple, Orange |
| 17. Vadilal Industries Ltd. | Vadilal | Mango, Pineapple, Orange |
| 18. Himgiri Foods | Himgiri | Mango, Pineapple, Orange |
| 19. Lakhanpal Foods | VAFA | Mango, Pineapple, Orange |
| 20. WIMCO Ltd. | Sunsip | Tropical Fruits Kioces |
| 21. Tims Products | TIMS | Mango, Pineapple, Orange, Guava |
| 22. BEC foods | ROLZ | Mango, Mixed Fruit Juices |
| 23. The Maharashtra Inds. Development Corp. Ltd. | NOGA | Pineapple Agro. |
[The above mentioned list consists of the brands noticeable in metros and as such there are a large number of small canning units scattered all over the country catering to niche markets.]
Imports:
With a whole range of product lines opened up for imports over the past 14 months, these exporters have now full freedom to exploit the huge Indian market. The fruit juice market in India is not yet large enough to justify investing.
Today the consumer has got a wide variety to choose from as many foreign food and personal products can come in unrestricted now. The Indian market place has seen a dramatic increase in the range and quality. There is expected to be some level of competition in these areas. Quality will have to improve and manufacturers will have to be more cost effective.
Proliferation of product range is also proving to be a problem for retailers with limited space on their shelves. With Indian producers also improving and enhancing their variety, products are jostling for space.
Consumer’s belief in India products too is going up; earlier issues were of durability and poor shelf life. Now, Indian products have moved up to the next level. This could make it tough for imported products to make a dent in established categories, especially where there is a substantial price difference.
The complex sales tax structure In the various states confounds the exporter of fruit juices for instance, it is myriad varying from state to state i.e. Central sales tax in Delhi at 85 and in Kerala it is 20%, while Maharashtra has VAT plus octroi hence fixing prices is quite an exercise and when you add on these, the product becomes expensive. Right now, sale of imported goods from stores is at the top end and is small percent of store turnovers. But this is expected to go up in the years to come. Imports may not really make an impact in the market, but could allow legitimacy to some of the products that come through the grey market channel.
The removal of QRs [Quantitative Restrictions] is not expected to have a major impact on the Rs 100 – crore organised domestic juice market. This could be on account of the continuance of customs duties at around 30-35% & juices have been coming into India under the open license policy for over 2 years now. As such, there has been no change ion the Exim policy for the juice market.
Through industry players are confident that there will not be a deluge of juice brands but they expect some more additions in this category mainly because this market is growing and not necessarily as a fallout of Exim policy. They also believe the stage is not set for any major price restructuring, or price war in the Indian juice market as yet, as this market is very small still, and normally severe price wars happen only when the market becomes big.
Both Berri and Ballantyne are among the recent entries in the industry. Berri fresh juice producer which has 60% of the Australian domestic market and sells to over 30 countries. The company’s products such as Apple, Orange, dark Grape and Apricot juices are now available at supermarkets in the major cities in India. Yet, in the year that Berri has been in the market, it has found the response to be good. It has gained about 5-6 % of the fruit juice market. For Berri, whose biggest market happens to be Asia, India is still small. But the company is serious about growing it. Ballantyne also as Australian company is also not looking at investment in India at this stage.
Problems with imports:
· The imported products on offer in most stores stocking foreign foods reveal that they are close to their expiry dates.
· Most such products available now come through the grey market. Most of these products, especially those that come from South-East Asian countries, are imported by agents who supply to stores. As the imported process itself is a long drawn out affair, often food products land up on shelves quite close to their expiry dates and there is also a danger then of agents tampering with expiry dates and consumers buying stale food.
· The other problem that retailers face is that since they are dealing with agents there is a problem of returns of products when they are past expiry dates. Its not an issue when a retailer is dealing with a company as there is a mechanism for accepting returns. At times companies are seen to import through their own channels and supply it to the retailers.
· India is a difficult market mainly because of delays at the docks, tariffs and duties on various products, bribery and corruption and the lack of a cold chain (for horticulture produce). Things when they arrive do not get straightway into cold storage i.e. the inadequate infrastructure to handle the distribution of fresh produce, which causes a rapid deterioration in the quality.
Therefore, while there could be more brands in the organised juice market, the bigger chunk of the market will, in all likelihood, continue to be with the already existing players. Fruits and their derivatives are expected to enter India in huge quantities and once the market becomes bigger and volumes come in, prices of imported goods are expected to come down.
Substitute:
Fruit juice companies have to face a two level competition i.e. on the first level with the substitutes and the then the players within the industry. The ‘sip war’ is comprised of the following players with respect to India.
· Soft Drinks (both carbonated and Non- carbonated soft drinks)
Soft Drinks are divided into carbonated and Non- carbonated drinks. While Cola, lemon and oranges are carbonated drinks mango drinks come Non- carbonated category.
· Flavoured Milk (energy, N-Joy etc.)
Just like fruit drinks Flavoured milk is also positioned on the health platform. Companies are trying to project it as a fun drink with added flavours and innovative packaging.
· Mineral Water
Fruit drink sellers consider even mineral water as substitute to their offerings. The main assumption is that packs ensure quality delivery.
· Other products
Milk by- products like buttermilk and lassi also serve as major substitutes. They compete in terms of low price as well as easy availability. These drinks are also considered important from the health perspective.
Distribution patterns:
Distribution network and reach are vital factors for success of the brands in the fruit beverage market. It is mainly the distribution strategy that the companies are focusing upon.
The distribution is mainly done through stockist. The companies also have franchises that work as a separate entity. Some companies also have their C & F agents to give the product to the distributors, who further distribute to the retailers. To co-ordinate the things properly with the distributors, companies keep their own field force.
Below the figure shows the many ways the companies in this industry are seen to be operating:
The urban Indian retail sector has traditionally been structured around three small retail entities—the grocer, the general store and the chemist.
· The grocer stocks non packaged, unbranded commodities such as rice, flour, and pulses, as well as branded fast moving consumer goods (FMCGs)
· The general store stocks only branded, packaged FMCGs.
· The chemist, a part from dispensing pharmaceuticals products, sells branded FMCGs such as personal care products and health foods.
· Departmental stores and supermarkets.
· Others:
§ Bakeries and confectioners
§ Fruit juice/ tea stall/ vending machines
§ Ice-cream parlours,
§ Electrical and hardware stores and
§ Non-food boutiques, etc.
These retail outfits stock branded FMCGs that gel with their businesses.
Supply chain integration does not quite matter in the case of the small retailer because of the small scale of his operations. He normally deals directly with wholesalers with whom he is able to negotiate rates.
Retail consolidation (consolidation of buying power) among supermarket operators is unlikely to hurt small retailers simply because it will affect manufacturers directly, who will not want to compromise on the distribution reach to offer large volumes to a few big retailers.
The small retailers form an integral part of the wide distribution network set up by the large FMCG companies. Marketers have also found that private/ store brands from supermarkets can prove to be a threat to their own brands and hence, desist from encouraging retail consolidation.
Consumption and buying Patterns:
The Indian lifestyle has a traditional predilection for fresh fruits and vegetables or those processed at home. People go in for fresh fruits vending from kiosk fountains, which produce instant juices from fresh fruits in the presence of the consumer.
One reason is the unavailability of hygienically produced and well- preserved products with the use of preservatives. The fact that it is packed denies its freshness. This was also a reason why some of the real but branded fruit juices launched in the late 1980’s and early 1990’s did not succeed.
Taste is often the secondary consideration in the Indian market for beverages. Fruit juices also lose on roughage, which is an important part of fruit nutrition. Few people know the difference between a juice and nectar.
In general, the Indian consumers have become health conscious now and are looking for healthy and natural appetizing juices. They are moving away from synthetic drinks to natural and wholesome fruit juices. At present;
· Per capita consumption of juices in India is estimated at a fraction of a litre i.e. 200ml.
· The consumption of fruit juices in take home packs is estimated at 17250 mnlt.
· Consumers go for convenient and economy products.
§ So small packs are well suited for travelers and children and large take home packs for families and price conscious people.
· Availability in chilled form and brand awareness plays a crucial role in purchase decision.
§ This has implications for the need for availability of the product and in the right form.
· While there is no aversion to consumption of fruit beverages by any group, the main consumers of this market are people in the age group of 30 and below.
§ Young adult and teenagers predominantly consume tetra pack drinks.
· Brand loyalty is very low, as all the products taste the same.
§ But brand loyalty is high in case of kids.
▫ Though there is a lot of difference between brand awareness and brand loyalty.
· Consumers are money conscious where the purchase of fruit beverages is concern.
· Consumers are not ready to explore the market.
§ They do not want to change their taste and are stuck to their old brands.
§ Orange and other drinks are slowly picking up and breaking the loyalty towards old brands.
Main Competitors:
A host of brands are jostling for thirst space. Not just colas but beverages and fruit juices of all hues are adorning shop shelves. From bottled iced-tea to branded chhaas, fruit-based drinks and flavoured milk, beverage makers have gone berserk with product innovation as new variants continue to flood the market.
Fruit drinks are high on the swig list in summers as it is part of the health fad sweeping the nation. Health conscious consumers are increasingly giving aerated drinks the go by and making a beeline for fruit-based concoctions. Moreover, sporadic controversies about pesticide-infested cola drinks are said to be driving consumers towards fruit-based drinks as a safer alternative. That is why even existing players are going all out to pour out new flavours.
Dabur:
Dabur Foods that was set up in 1997 has brands like Hommade, Lemoneez and Capsico in its basket. The Rs. 37 crore Dabur Foods ltd, a wholly owned subsidiary of Dabur India ltd ahs two brands of juice in the market, they are;
· Real
· Real Active
For its Real brand, Dabur is focusing on increasing in home consumption by targeting mothers and children. It is priced in the range of Rs. 60 to 65 [1 liter] and Rs 15 [200ml] except for Guava that is sold in the range to Rs 65 to 70 and Grape that is sold for Rs. 70 to 75. Its ingredients are water, fruit concentrate, sugar, citric acid and flavours of;
· Grape, Guava, Orange, Pineapple, tomato, Mixed Fruit, Litchi and Mango.
The Real Active brand is targeted towards fitness- crazy young consumers. The drink is positioned on the health plank. It was launched towards the end of 2002. At the same time, the company plans to position Real Active as its premium juice brand, while Real would be targeted at consumers belonging to socio economic categories B and C also. It contains only fruit concentrate and water. It is priced at Rs. 68 and 70. It is available in the Flavours of;
· Apple and orange.
The company was eyeing a turnover of Rs. 60 crore in the year 2001 -02, which is an increase of nearly 50%. According to the company it ahs seen a growth of 44% in the financial year 2001-02 as compared to 34% in 2000- 01. The company plans to increase the advertising spends for the brand by nearly 40%. Today the advertising and marketing budget for the brand by nearly Rs 8 Crore. The company’s thrust is on increasing in-home consumption therefore they are mainly targeting the mothers and children.
However, the company has restricted its activities in the urban areas only and wishes to fully consolidate markets in the cities before looking at the small towns and rural areas Dabur Foods claims to be the market leader in the pure juice category such as Punjab, Delhi, Haryana, etc.
PepsiCo:
The Pepsi operations in India are now the part of the new Asian division of PepsiCo Beverages International formed by the merger of PepsiCola International, Tropicana and Gatorade, the sports beverage company acquired from Quaker Oates. Earlier, India was one of the eight business division of the beverage company that used to report to PepsiCo International in New York directly. Now it reports to PepsiCo Beverage International Asia in Hong Kong. PepsiCo Beverage International is a division of PepsiCo Inc. This move has been prompted by the need to give greater regional focus to new products like Tropicana and Gatorade so that they become a key element of the overall portfolio of the US beverage major.
PepsiCo Inc. is one of the world’s largest food and beverage companies. The company’s principle businesses include:
· Frito – Lay snacks
· Pepsi-Cola beverages
· Gatorade sports drinks
· Tropicana juices
· Quaker Foods
Pepsi India is already working on a strategy to launch a bevy of Gatorade products in the country by the end of this year. These are as follows:
· Gatorade Thirst Quencher
· Gatorade Nutrition Shake
· Gatorade Energy Drink
· Propel Fitness Water
· Gatorade Energy Bar
It is also planning to give a major thrust to the juice business through the launch of a host of new products under the Tropicana brand name i.e. on the health and energy platform. PepsiCo has so far invested around Rs. 100 Crore inn ready to drink juice segment where the company has two brands Tropicana & Slice. It has 14 plants in India producing fruit juices & 2 of them work on tetra pack.
Tropicana:
Tropicana entered the country in 1998. Tropicana is currently imported in a concentrated form, which is later reconstructed at a plant in Baramati, near Pune and vacuum packed into tetra packs after paying an import duty. It covers around 18 cities of India. The factor of its success is that it has a tightly controlled distribution system on top of an equally controlled production and this in turn helps it keep its taste constant and the company boasts of it too.
Tropicana Beverage Co. recently announced the company’s inclination towards bringing in an entire series of juices and other health drinks from its international portfolio into India in the coming years. The Tropicana brand, per se, has been positioned on the ‘health’ platform.
Pepsi also plans to give its juice brand – which has seen many hurdles in the nascent and niche juice market – a renewed thrust in the coming days. A price revision of the brands is also on the anvil.
Since 2001, Tropicana roped in celebrities in the field of nutrition and health to sell its brands. Under which they got renowned people in the field of health to recommend their clients to use their brand. The list of names included the likes of Anjali Mukherji, Sabina Sehgal Saikia and Vandana Luthra, who promote the brand, positioned as a health drink, to their upwardly mobile clientele. Even celebrity doctors and pharmacists were included in its list of marketers. Tropicana is also sold through various health clubs like Talwalkars, Personal Point, etc. in Mumbai and Delhi. In the past as a part of its promotional activities, the company had conducted a ‘Tropicana Health Run’ in the capital, slated for World Health Day, which was on April 7, 2001. Tropicana also runs a programme called ‘The Tropicana Club’ under which every time one buys a pack of Tropicana he earns points which he can collect and exchange for a wide range of gifts and also, as a member he gets unique offers, exciting gifts and interesting information on keeping fit and looking good.
The company is seen to intensify its distribution network, with a greater thrust on large institutions. Apart from retail and consumer – level promotions, Tropicana is being promoted through health bulletins and health leaflets. The company intends to continue with its ‘unconventional’ retail thrust. Apart from the 20,000 to 25,000 outlets across 18 cities that Tropicana has a presence in, the brand is being placed across gymnasiums, fitness centers in 5-star hotels, coffee shops, airlines, hospitals, offices and health stores. These points of consumption are not consequential in providing high volumes, but important from the imagery point of view. Typically, non-retail stores have been contributing 12 – 15 % of the brands sales. Tropicana evokes a high brand loyalty among health – conscious middle and upper-middle class segments. The company is seeking to project itself on the health platform and has an ad spend of around 20% of its sales.
The brand’s existing tagline of ‘Taste of Good Health’ has now got an extension statement of ‘Don’t forget the juice’, ‘Tropicana 100% pure fruit juice’. Tropicana is packaged in a 200 ml slim pack [which replaces its 250 ml pack] and 1-liter in a flat pack tetra pack. The company is seen to run promotions in coordination with its other offering like a scheme where 16 gm pack of Lays Magic Masala that comes free with a 200 ml pack of Tropicana. Worldwide, Tropicana has a host of juice brands under its belt. Brands like Twister, Dole, Looza, Fruvita and Juice Bowl, which could find their way into the Indian market in the coming years. It has decided to make changes in the composition of its juices to suit the Indian taste buds. For instance, realizing that Indians like a sweet flavour, it decided to launch a separate sweet orange juice product specifically for the Indian market. Since it could not dilute its juice content, it decided to substitute part of it with grape juice to make it sweeter. Even it’s launched tomato and mixed fruit juices have been altered to suit the Indian palate.
Currently, in terms of market share, Tropicana is believed to trail behind rival Real (Dabur) but is not far behind and also has close to 40% market share of the estimated Rs 100 crore branded juice market.
Pepsi sets the pace for backward integration of Tropicana, as a first step towards backward integration for its pure juice business Tropicana is foraying into contact farming of citrus fruits like oranges and Keanu. Punjab- Jallowal – has been chosen as the location for the project. The 3 phase project involving trials, nursery and contract farming, is being pursued jointly by Pepsi and the Punjab Agro Export Corporation. Through in its infancy at the moment, the project vision however is of about seven years. If successful, it would mean 100% localization of orange juice and it becoming the supply center to other regions.
A present Tropicana has the following flavours:
Orange, Nature Sweet, Apple, Grape, Pineapple, Tomato, Mixed Fruit.
Slice:
PepsiCo in 2002 poised to make deep inroads into juice drink segment in India with seven new variants of its ‘Slice’ brand. For the first time in company’s history, a ‘Litchi’ variant of Slice was introduced. Apart from that, a guava and Orange flavours was also being offered. Apart from 200 ml slim line cartons priced at Rs 10 each, Slice juice drinks is subsequently made available in 250 ml returnable glass bottles as well.
The company invested significantly to bolster the Slice brand in the year 2002 and plans to invest heavily through the year while Slice is now available in litchi, orange, mango and Guava flavours, they are expected to be soon joined by Slice Cocktails.
PepsiCo is sourcing litchis from Muzaffarpur, guavas from Karnataka and Allahabad, and mangoes from Ratnagiri.
Mangola:
Mangola, the other fruit-based beverage in the PepsiCo’s list, has a healthy presence in Maharashtra. Pepsi Foods acquired Mangola, originally a brand of Duke’s, when it officially stepped into the domestic market while Mangola’s distribution is restricted to Maharashtra; Slice is available in all markets.
Pepsi, in association with foods and toiletries major Hindustan Lever, launched Lipton Iced Tea in returnable glass bottles and PET bottles. It has also introduced Mirinda in apple and strawberry flavours. Pepsi had earlier said they planned to reduce their dependence on cola and bring it down to 40 per cent of total sales in the next few years. Pepsi came on aggressively with its "Oye Bubbly" campaign. Coca Cola promised consumers a date with Aishwarya Rai with its "Thanda Aish Cash" promotion. It also promoted ThumsUp through March and April with its "Hai Dum?" campaign featuring Bollywood actor Akshay Kumar.
Parle Agro:
Parle Agro Private Ltd is looking at product expansion in its various business segments to sustain growth in a sluggish market. In the fruit drink segment where Parle Agro has a hugely popular product ‘Mango Frooti’, it is planning to get into orange and pineapple under the same brand of Frooti. While orange pulp will be imported from Brazil, pineapple will be sourced from Thailand.
At the same time, it has also embarked on stretching the franchise of its existing brands—Frooti, Appy and Bailley Mineral water. It knows the market and has sustained its brands in spite of the huge unorganized segment. Besides, the company will use its existing distribution network to get into the new categories. At the moment, its only advantage is its distribution strength.
Parle Agro boasts of a franchise network which few can match. It has two different sets of franchisees for its packs (11 franchisees) and mineral water (18 franchisees) that manufacture and distribute its brands. It ahs also attempted to venture into direct distribution by engaging special trucks to transport its brands to retail outlets. For instance, in Mumbai, it has 50 trucks plying between its factories and the outlets. Besides, future plans include introduction of the same direct distribution system for its franchisees across the country.
Flushed with funds after selling of its portfolio of soft drink brands, Thumps Up, Limca and Mazza and bottling facilities to Coca-Cola the company has enough cash and this is evident since it has not got listed. It also has a massive distribution network to reach its end consumer. Besides, the goodwill of the Parle brand is a great help in its new ventures.
The ‘fresh n juicy’ Frooti brand, is dominating the packaged fruit based drinks category since its launch in 1985. Frooti Mango, which has 75% market share in tetra packs, grew by a modest 4% in 2001 according to ORG-Marg data. Larger pack sizes (1 liter) and more pure juices (such as orange and pineapple) would soon appear under the Frooti brand, taking on the existing competitors in these flavours and sizes – brands such as Tropicana, Real and Onjus.
Frooti has always been positioned as a drink for kids but now the company is looking forward to position it as a drink for the youth, especially, the college going teenagers. This was the basic rationale behind the Digen Verma Campaign, where a real life, down to earth person, who, like any college student likes to bunk classes, is a good sportsman and is a popular figure in the college, with whom the teenagers could actually associate themselves with Digen Verma.
Parle Agro’s product portfolio includes Appy, Frooti and N-Joi (a milk base drink, which are priced at Rs 10. New PET bottles have been introduced in 1 liter and 500 ml for mango Frooti at a price of Rs 28 and Rs 18 respectively. It has recently introduced a green mango flavour in the tetra pack and is also priced at Rs. 10. Parle Agro’s has an enormous distribution reach of 10 lakh outlets, including leading hotels and restaurants, eateries, super – markets, and paan-shops. Meanwhile, Parle Agro is planning to tap the rural markets with its strongest brand Frooti. There are plans to set up a separate distribution in the product itself.
In keeping with market sentiments, cola biggies Coca Cola and Pepsi, too, are focusing on innovation in their non-cola portfolio. Coca Cola has launched Maaza in pineapple and orange variants in 125 ml tetra packs and large family packs. It recently started a new facility in Bareilly to cater to the growing demand for Maaza in north and central India. It is learnt that the company is also set to launch some "niche" products.
Parle Agro has seen a trend towards fruit-based products. Parle Agro spent Rs 5 crore (Rs 50 million) to relaunched its flagship mango drink, Frooti, with modified packaging and a new ad campaign. It launched a guava drink, Frooti Guava, in Mumbai and other western regions in 65ml packs priced at Rs 2.50. The company is now out with Appy Fizz, an aerated apple drink in champagne-shaped PET bottles. Launched in Bangalore, it is being rolled out in Kolkata and Chennai in 500 ml and 300 ml packs retailing at Rs 25 and Rs 18, respectively. The 60 million case fruit beverage market never had it so good. Of the Rs 7,000-8,000 crore (Rs 70-80 billion) drinks market, fruit beverages account for Rs 500 crore (Rs 5 billion), growing at 25- 30 per cent annually. Like most drinks, summer accounts for 65 per cent of total sales.
Godrej:
Godrej Foods Limited is into the business of manufacturing and selling processed foods and trading of vegetable oil. The company has a number of leading cooking oil brands like CookLite, Godrej and fruit juice brands like Jumpin, Xs, refresh in its product portfolio. The company’s main source of revenue is its oil trading business, which makes performance of its business highly dependent on commodity price trends.
It has 3 fruit beverage brands in its product portfolio, while Jumpin and Xs are national brands, Refresh is available only in states of UP and Rajasthan.
Jumpin:
Jumpin brand is positioned as a fruit drink. It is available in the flavours of orange, pineapple, apple and mango. Jumpin is available in 200ml and the price for all the flavours are Rs 10.
Xs:
Xs is targeted towards adolescents positioned as nectar drink. Xs is available in following flavours litchi, mango and guava and it is priced at Rs 15 for the 250ml pack.
Refresh:
Refresh is positioned as a mass market drink but targeted towards adults.
Godrej Industries' foods division with its XS fruit juice launched in 1998 in litchi, guava and mango flavours. Exotic blends of Godrej include fruit juice Berry Blast (strawberry-cherry-black currant) and Triple Tickle (apricot-peach-apple). The new range is priced at Rs 15 for 200 ml and Rs.65 for 1000 ml. Godrej Foods, "The idea is to come out with exotic flavours that will combine great taste with attractive packaging for the youth." With the new offerings, he expects to see a 30-40 per cent rise in sales.
Gujarat Co-operative Milk Marketing Federation:
(Amul)
Pitching in to pose further competition to the colas is the recent launch of Amul Masti chhaas by the Gujarat Co-operative Milk Marketing Federation. Amul has also added two new variants -- strawberry and mango flavours -- to its milk drink brand Amul Cool. Amul are currently selling 400,000 units of Amul Cool per day with six flavours. That is 23 per cent higher than last summer, when they had just four flavours. Coming next from the Amul stable is Cool Cafe, a coffee drink to be launched in Mumbai, Delhi and Gujarat.
Retailers, however, say that while such efforts lead to a temporary revival in offtake, sales tend to slacken once the promotions end.
Product
Kiwi fruits are small oval fruits with a thin brown skin, soft green flesh and black seeds. They are rich in many Vitamins, flavonoids and minerals. In particular, they contain a high amount of Vitamin C (more than oranges), as much potassium as bananas and a good amount of beta-carotene.
Anti Oxidant properties of Kiwi Fruit
It is important to note that kiwi fruits contain a remarkable amount of Vitamin C, E and A. Vitamin C is a water-soluble antioxidant that has been proven to protect our body from free radicals, dramatically improving the health of individuals who consumed it regularly against all kinds of disease, from cardiovascular problems to cancer and obesity. Vitamin E has been proven to have similar effects, but is fat-soluble and thus is complimentary to Vitamin C in its functions. Kiwi fruits contain both these vitamins in high amount, which help protect our body against free radicals from all fronts. Kiwifruit seed are where the most of the Vitamin E and dietary fiber are found.
Kiwi fruits have a high fiber content
The high content in dietary fiber helps improving diseases such as diabetes, by controlling sugar levels, and cancer color, since fiber binds to toxic compounds in the colon and helps us expel them. Fiber has also been proven to reduce cholesterol levels, improving the conditions of patients with cardiovascular diseases and lowering the probability of heart attacks.
Summary of Kiwifruit Health Benefits
Eating kiwi fruit is clearly a healthy choice, particularly useful in these cases:
· Prevents Asthma
· Prevents wheezing and coughing, especially in children
· Protects our DNA from mutations
· Provides a healthy amount of antioxidants and vitamins
· Helps prevent colon cancer thanks to a high fiber content
Kiwi Fruit Nutrition Content Research
| Nutrient Content | Gold Kiwifruit | Green Kiwifruit | Main Functions |
| | 181 ug/100g （Flesh） | 158 ug/100g （Flesh） | Stabilize VA、Inhibit Oxidation & Free Radicals Prevent Tumor、Improve Fecundity、Slow Aging |
| Vitamin E （Bearing Phenols） | 3.025 mg/100g （Seed） | 2.72m g/100g （Seed） | Inhibit Oxidation、Enhance Immunity、Participate In DNA Synthesis、Slow Aging Inhibit Mutation、 Prevent Cancer |
| Vitamin C （Anti-Scurvy Acid） | 135.96 mg/100g （Flesh） | 154.95 mg/100g （Flesh） | Accelerate Collagen、Synthesis Stop Bleeding、 Accelerate Amino Acid Metabolism、Inhibit Oxidation、Activate Folacin、Expel Toxin |
| 481.50 ug/g （Peel） | 222.51 ug/g （Peel） | Prevent Inflammation、 Inhibit Cancer、Detoxification Accelerate Wound Close、 Anti-Cholesterin | |
| Arginine | 0.0953% （Flesh） | 0.0463% （Flesh） | Provide Baby Need Amino Acid、Accelerate Immunocyte Activity、Promote Secretion of Growth Hormone Prolactin and Insulin |
| Se | 3.17 ug/100g （Seed） | 1.53 ug/100g （Seed） | Inhibit Oxidation Prevent Cancer、Protect DNA Inhibit Mutation、Prevent Cardiovascular Diseases、Slow Aging |
| Polysaccharide | 4.56 g/100g （Peel） | 3.44 g/100g （Peel） | Inhibit Oxidation、Prevent Cancer、Inhibit Mutation、Repair & Shield Cells、Lower Blood Glucose、Improve Immunity、Accelerate DNA Synthesis、Strengthen Marrow Hematopoiesis |
| Polyphenol | 4.56 g/100g （Seed） | 8.47m g/100g （Seed） | Inhibit Oxidation Convergence、Stop bleeding、Antiseptic、Prevent Cardiovascular Diseases |
| Monkey Peach Alkali | 0.82 % （Seed） | 0.83 % （Seed） | Sedation 、Reduce Blood Pressure 、Improve Sex Function |
Product Description:
This product is actually a mix of 20 percent pure kiwi juice, water, and cane sugar. With a strong, accurate kiwi flavor, this could actually turn out to be a pretty tasty orange juice substitute – a possible motivation for placing a high-visibility Vitamin C label across the front of the package.
1) Kiwifruit Juice in 250ml PET Bottle
Product code: KS250ML
Description: Kiwifruit Juice
Packing: 24 X 250ml
Gross Weight: 12.5kg
Approx. Qty per 20ft FCL: 1400 Cartons
This Ready-To-Drink variant offers an option to retail operations catering to customers looking for healthy, thirst quenching single serve options. The well-designed packaging ensures that it stands out whether it be displayed in normal shelves or walk-in chillers.
It is also ideal for foodservice operators looking to offer single serve items on the beverage menu. Inventory control becomes less complicated and KiwiJoos are definitely a refreshing addition to any beverage menu. Stored at an ambient temperature away from direct sunlight or heat, the product has a shelf life of one (1) year from date of production. It should be consumed immediately upon opening and KiwiJoos are best served chilled. MRP of this 250 ml bottled drink will be Rs. 30.
2) Kiwifruit Juice 1.2 liter Concentrate
Product code: KC25FFM
Description: Kiwifruit Concentrate
Packing: 12 x 1.2lt
Gross Weight: 16.5kg
Approx. Qty per 20ft FCL: 1008 Cartons
This product comes attractively packaged in a 1.2 Litre PET Bottle with a recommended dilution rate of One (1) part concentrate to Seven (7) parts water. This variant offers value for money and convenience for those with large families or entertains frequently.
It is also ideal for the foodservice establishments as it requires minimal storage space and no refrigeration is required, allowing them to cater for large functions. Stored at an ambient temperature away from direct sunlight or heat, the Concentrate has a shelf life of one (1) year from date of production. Upon opening, the product should be kept refrigerated. KiwiJoos are best served chilled. MRP of this 1.2 Lt bottled drink will be Rs. 130.
3) Kiwifruit Juice Drink in Tetra Brik Aseptic 1litre and 2 litre Slim line Re Cap
Product code: KS01TPSL
Description: Kiwifruit Juice Drink
Packing: 12 X 1lt, 12 X 2lt
Gross Weight: 13kg
Approx. Qty per 20ft FCL: 1350 Cartons
This Tetra Brik variant is UHT processed, contains no preservatives and comes with a convenient re-sealable non-drip spout. It is an ideal choice for active families or individuals who want a convenient yet nutritious thirst quencher. With this addition, KiwiJoos has now a wide range of packaging choices to suit both consumers and retailers.
Foodservice operators looking for a shelf safe; space saving re-sealable packaging can now opt for this variant. The Tetra Brik variant has a shelf life of one (1) year from date of production when stored at ambient temperature. Keep away from direct sunlight and heat. Keep refrigerated upon opening. KiwiJoos taste best when served chilled. MRP of this 1 lt Tetra pack will be Rs. 90 and MRP of 2 lt Tetra pack will be Rs. 180.
.
4) Kiwifruit Juice in 5 litre HDPE Tub
Product code: KS05FFM
Description: Kiwifruit Juice
Packing: 24 X 5lt
Gross Weight: 23kg
Approx. Qty per 20ft FCL: 840 Cartons
This is a Ready-To-Drink variant ideal for foodservice operators catering for large volumes. The product offers a refreshing change to your beverage menu and is a versatile ingredient for concocting cocktails or other non-alcoholic cocktails.
Storage is convenient, as it requires no refrigeration. The product has a shelf life of one (1) year from the date of production when stored at ambient temperature away from direct sunlight and heat. The product should be kept refrigerated upon opening. KiwiJoos are best served chilled. MRP of this 5 lt HDPE tub will be Rs. 400.
Future Products:
· Aerated Kiwi drinks
· Kiwi Kraze (Kiwi-apple-lemon)
· Gold Kiwifruit Juice
· Kiwi wine
Packaging:
Juices can be found in every type of packaging. In early days, cans and glass bottles were the only available types of packaging. Today, the assortment includes PET bottles, sports bottles and brick packs.
Introduced to reduce shipping weight or to allow small children to pour their own juice, PET bottles provide another benefit: shatter- resistant properties. Juices found in refrigerator case typically come packed in gable-top cartons. The newest innovation in cartons is the re-closable plastic cap. Some single- serving juice drinks come in sports-top PET bottles. Some companies concentrate on proprietary packaging, with easy grips or unusual eye-catching shapes.
Packaging is an important part of promotion today hence the company has decided that KiwiJoos will be served in transparent PET bottles for all the quantities and will carry the company Logo/ Symbol, nutrient value of the juice and the statutory requirements like the ingredients etc.
Key Success Factors:
· Processing and Packaging technologies used:
State of the art production and packaging technology is a must in this industry. This gives an edge in packaging and ensuring freshness of product besides enhancing the image.
· Distribution Strategies, Logistics and reach in the market:
A strong distribution network is essential for ensuring availability to fight competition from the other players and also the substitute that have a strong distribution reach.
· Regional taste preferences:
Companies should take into account the regional taste preferences and build products to serve the same. Various concoctions and formulations in the US and other foreign markets suggest that such strategy is necessary to live the image of the company and remain in the forefront.
· Product portfolio and variants produced:
Innovations in terms of ethnic flavours and mixes will pay off. With respect to “KiwiJoos” we must make sure we increase our product baskets as we can’t exist with only one flavour and many flavours will also help in leveraging and ensuring that there is optimum utilization of resources.
· Sourcing of raw materials:
Global sourcing strategy will give an edge over other players in terms of both cost and quality advantages.
· Flexible and effective marketing mix:
The product mix, promotional mix, pricing mix and distribution mix should be made effective and should be flexible in all sense it should help us to combat the primary competitors i.e. players in the fruit beverage market and the substitutes i.e. soft drinks, flavoured milk, mineral water and unbranded sector.
· Strategic alliances and joint ventures:
Strategic alliances and joint ventures help in gaining competitive advantage in packaging, distribution and product formulations.
SWOT Analysis:
Strengths:
· Innovative flavour hence we are bound to get the attention with proper communication.
· Committed, capable and ambitious management.
· We can gain incentives as we will be a SSI and so we can pass these to capture more market.
· Flexibility in our operations as initially we will be confined to few cities so can focus our efforts on the tasks.
Weakness:
· Our distribution set up initially will be weak when compared to the others in the market.
· Kiwi as a fruit is new in the market and not all people take the risk of experimenting with taste.
· We are entering the market with only one flavour and our next flavour will be out only after six months of the first launch.
· Our financial constraints with respect to our competitors demand that our resources are used optimally.
· We will not be able to price our product lower than the others in the market as we have a longer distribution channel and managing this channel also will be an important task. Also as our product is not available in India its cost of acquiring increases and therefore it cannot be sold at a low price in the initial stage.
Opportunity:
· The market is in a growing stage and fairly small in terms of market share as compared to other thirst quenching and healthy drinks so at this stage our entry is expected to be noticed.
· The market has a presence of only few players and they are not too aggressive in their acts.
· More and more people in the urban areas are getting health conscious and are making fruit juice a part of their daily diet. Hence the market is growing.
· The government policies are expected and are showing trends to encourage the food processing industry.
· The kiwi fruit can be then cultivated in India in the regions of Himachal Pradesh, Uttranchal Pradesh, Sikkim, Arunanchal Pradesh, Meghalaya, Jammu and Kashmir and Nilgiri Hill, to cut down the cost of imports of the fruit.
Threat:
· Our competitors are deep pocketed and they could harm us by getting aggressive in their promotional activities.
· The competitors have strong brand images in the market because of their other businesses and their presence in the market from an early stage.
· Indian market has characteristic of serving a wide variety people which is a challenge for all the marketers.
· Others can adopt the flavour and the value of a unique flavour could be neutralized soon.
Marketing Strategy:
Marketing Summary:
Pursuant to our company policy stating "Quality First, Credit Prominent", we process our KiwiJoos with strict production standard, quality control and sophisticated processing technology, we at all time provide our consumers the natural and healthy Kiwifruit juice.
KiwiJoos is a new flavour in the market and the company is also new so its marketing budget cannot be limited. So the strategy will be to enter the market with a big bang. Developing visibility and brand equity is the key. KiwiJoos will be advertised in different media with respect to our target market i.e. the women of the house and children who are an important influencing factor in today’s scenario. The teens are the most who like to try out new and different products so even they are an important target audience.
In addition to the advertisements which will be used to drive consumer sales, KiwiJoos will leverage a networking campaign with respect to the distributors and sale promotion at the points of purchase i.e. local restaurants, gyms etc. to drive commercial sales.
KiwiJoos will be on the shelf in all markets by 15th February, the company will start supplying its stock by 6th February. The promotional activities will start from 12th February.
Mission:
KiwiJoos mission is to provide the highest quality of fruit juices. We exist to attract and maintain customers. When we adhere to this maxim, everything else will fall into place. We will ensure that our products will exceed the expectations of our customers i.e. we develop a competitively superior value proposition and value- delivery system.
Marketing Objective:
· Maintain positive and steady growth each month.
· Experience an increase in new customers i.e. we have to ensure that our products have a high trial rate which will help us to turn these new customers into long term customers.
· Generate brand equity at the markets we are catering to as well as within the supplier and distribution networks.
Financial Objectives:
· Realize a 3% increase in the gross profit margins through efficiency gains every year.
· Reduce the logistic cost associated with product delivery by 10% by the end of the first five year of operation.
Target Markets:
· The women of the house
· Children
· The teenagers
· In-home consumption
· Out of home consumption
The women of the house and children are an important influencing factor in today’s scenario. As the KiwiJoos contains lots of health benefits, the women who care for her family wants her family to be healthy and so are they are targeted.
The children are attracted to the beautiful ads and demand for the products as they want to experiment things just for the sake of it or for their self satisfaction.
The teens are the most who like to try out new and different products. Today’s teens are the most health conscious and put in lots of efforts to be healthy. So even they are an important target audience.
In- home consumption:
This group of people buys fruit juices for home consumption and in many case treated as grocery item and is on the shopping list and forms an important part of their diet.
For an average Indian population juice consumption is seen as a luxury and is a very urban phenomena as people in the urban are getting more and more health conscious and relating and accepting juices as a healthy social drink. These people are typically sophisticated and are exposed to the idea of healthy living and are concerned of the well being of their families.
Usually the lady of the house takes the buying decision but she is influenced by her offspring’s many times to the extent of brands and flavours.
One of the strong characteristics features which is common throughout our target audience is that it is considered that juice is fresh only when it is extracted on the spot for consumption purpose and it is considered to be better than the packaged ones available in the market. This mind set will have to be changed and the customers will have to be convinced that KiwiJoos is fresh, has all the nourishments intact and is available without the hassle of extraction for consumption.
Out of home consumption:
This consumption pattern is usually observed in people who feel the need to quench their thirst, get refreshed or both. These types of people are important of KiwiJoos as they are the people who will try the product in small quantity and give us an in road in the home for in home consumption, which is our focus area.
If this segment is satisfied then they will start personal use of KiwiJoos and they will also act as a source of mouth - to - mouth publicity, which is considered to be one of the best in its kind.
This segment is challenging one as there is a dual pattern of consumption which mainly exists here i.e. firstly an individual decides if he/she would like to have a fruit juice or a substitute like carbonated soft drinks, water, flavoured milk, etc. then if he/she chooses fruit juice, they have to chose from the available alternatives then he makes a choice among the available brands with respect to the perceived value and its cost.
Such type of consumption is usually seen;
· On roads i.e. in front of the general stores, railway stations, bus stands, airports etc.
· Entertainment zones like amusement parks, cinemas, parks, theaters, etc.
· Eating-places like restaurants, college canteens, hotels, etc.
· Working places like offices, aerobics classes, gymnasiums, places of worship etc.
The key to serving this segment would be to be available and visible at points of purchase and including the person to buy, with effectively communicating to them that KiwiJoos is a healthy alternative to satisfy the thirst ensuring taste, fun and good health.
It is positive that fruit juices are being perceived as anytime beverage. Generation now is as much inclined to sipping fruit juices as colas, with teenagers driving the maximum trials.
Positioning:
KiwiJoos will position itself as a no – compromise drink where a person does not have to make any compromise with the fun element of having the refresher and the health element and that it is also socially appreciated/ accepted.
It will be communicated to the customers that nor do they have to make any compromises and that nor do the producers make any compromise in bringing them KiwiJoos which is made from fresh kiwi fruit and is produced under a well controlled and a healthy environment.
To put our point forward initially we will be using the tag line:…………………….and we will be promoting the kiwi flavour as “Exotic Kiwi”.
Brand Logo:
Strategies:
The single objective is to position KiwiJoos as the natural and healthy Kiwifruit juice in the cities it is served, commanding a 30% market share within 5 years. The marketing strategy will seek to first create customer awareness regarding product, develop the customer base and work towards building customer loyalty.
KiwiJoos seeks to communicate the message that it is the natural and healthy Kiwifruit juice in the market and will help them in not compromising on fun and health and that a customer can have both.
This message will be communicated through a variety of methods with the communication tools/ promotional mix.
The advertisements will be for the purpose of building and registering KiwiJoos as natural and healthy Kiwifruit juice and not only for our introductory flavour but also for the flavours in future. The ads and the promotional activities will be concentrating only on the cities in which KiwiJoos is served hence the main weight age will be given to the local media and advertisement on the national level only to the objective making our presence felt.
Marketing Mix:
Marketing mix comprises of approaches to price, distribution, advertising and promotion.
Pricing:
Price is the marketing mix element that produces revenues, the others produce costs and it is also one of the most flexible elements as it can be changed quickly, unlike product features and channel commitments. India is known as a price sensitive market i.e. an Indian customer wants more value at low price.
The company’s objectives with regards to pricing is to survive the resistance from the existing players, maximize profits and increase its market share in the five cities it is catering.
KiwiJoos’s pricing will be a premium pricing. As we are targeting the sec A and sec B of the middle class and also the Elite class the price must be affordable to consumers. Consumers are ready to shell out little extra money for the exotic and classic drink that has many health benefits. Even though we are catering only one flavour initially the pricing is close to the competitors pricing.
KiwiJoos will be priced as follows:
250 ml – Rs.30
01 liter – Rs. 90
1.2 liter – Rs. 130
02 liter – Rs. 180
05 liter - Rs.400
Distribution:
The distribution or reach factor is a marketing mix element that needs to be monitored over a period of time. Unlike product improvement or positioning strategies that are extremely sensitive to consumer preferences and changes, distribution inertia could dawn on the company over a period of time. An attempt to link distribution with the changing environment will ensure that a great deal of slow damage is averted. As consumer behaviour changes, competition picks up and the product moves through its life cycle, new channels may have to be considered, evaluated and chosen.
The company Shreeji Enterprises Pvt. Ltd has its KiwiJoos manufacturing and packaging plant in Nasik. The Kiwi fruits will be imported from New Zealand based company Zespri International Limited.
The company will be moving in the first phases i.e. the first year we will have an aim of entering only few major cities of India and establishing our brand with Kiwi flavour which will be seen as a launch-pad for our other offerings i.e. flavours. The initial launch will be in the following cities:
· Chennai
· Bangalore
· Delhi
· Mumbai, Pune and Nasik
· Kolkata
The transportation to the cities will be basically through rail and road depending on cost effectiveness. The inventory level will be decided with respect to the season and in coordination with the distributor and the company representatives. The company will have its representatives positioned at each city that will coordinate with the distributors and the company will interact with the retailer’s inorder to ensure the company first hand information about the product with relation to the customers. There will be 5 representatives stationed at each city who will have to make 40 calls a day in their respective territories.
To keep the channel active and result oriented following initial steps will be taken;
· They will be given discounts on cash purchases.
· The goods will be available on credit basis also.
Retailers have to be segmented based on Volume, exclusiveness, complementary products handled and basic requirement of refrigeration facilities, which is a must for our product. These factors will be given consideration before incentive schemes are worked out.
KiwiJoos will be marketed through different channels. All different sizes will be available at places where buyer buys products in greater volume;
· Supermarkets
· Discount stores like Big Bazaar, Apna bazaar, etc.
· Hyper Mall
· Petrol pumps
· Chemists, General and Convenience stores
· Health clubs, Gym, Gymkhanas etc.
· Entertainment zone: Theaters, Cinemas, Parks, Amusement parks, Game Parlours etc.
· Ice-cream Parlours
· Hotels & Restaurants
· Bakeries
In certain areas such stores may not exist so in these areas the bottles will be available at specific stores at the discretion of the representatives and distributors, these stores should be able to serve the basic idea.
The effectiveness of our channel will only be known when we assess our chosen channel on the following criteria:
· Are the customers expectation been met by us?
· Are the channels serving the targeted segments?
· Are our intermediaries motivated?
Future thought on distribution:
In our category if we are to become a national brand we will have to have a number of manufacturing plants close to markets to ensure savings on distribution costs which in turn could our brand a competitive edge with regard to the pull at the retailer level through good margins to the retailers.
In the plan to go international our KiwiJoos will be available in Japan, France, Greece, Hong Kong, Macao and China mainland in the future.
Promotional Strategy:
The promotional efforts will be on two fronts i.e. on our direct customers and the end consumers. This should ensure KiwiJoos a push from the distribution and a pull from the customers.
All our promotional efforts should serve some basic criteria like the activities should carry a feel good appeal and should enhance emotional attachment of the target with KiwiJoos.
KiwiJoos will be advertised in cost effective media like newspapers, radios, hoardings, at bus stands, and the most important and effective will be through TV advertisements. There will be some cosmetic variations of these advertisements when they are launched across the country. Regional celebrities who appeal to consumers may also be used in advertisements intended for various regions these celebrities will represent our positioning.
Sales Promotion:
We will be tying up with few other marketers and piggy backing our product on theirs; this is expected to give us access to the shopping list and homes of our target. Marketers that we intend to tie up with will be the ones that have a place in the shopping list of the lady of the house e.g. branded wheat, salt, frozen vegetables, magazines etc.
The company will also tie up with supermarkets and other stores, which are mainly volume oriented, by piggy backing our product on their in-house products. Both the above routes will help us in sampling our products to our target customers and in the right manner.
Attention will be given to the presentation part too, POP materials, store displays, stickers etc. will be used to create awareness at the retail outlet.
Advertising:
Advertising will be exercised with a media mix, which will consist of:
· Print Media:
Print Media will be used in the form of news papers of various languages. Print media will be mainly used with a purpose of communicating and complimenting our sales promotion schemes to pursue and gives us visibility.
· Audiovisuals:
Television as a media will be used to inform the qualities and benefits of KiwiJoos and give us visibility and build the brand image with the customers. The combinations of TV channels will be used at different intervals. The channels will be selected keeping in mind our target i.e. the lady of the house – channels showing good TRP ratings for their soaps; the influencers i.e. her offspring – music, movie channels, cartoons, etc.
· Audio:
Radio will be a key element in our media mix as it is cost effective and will cover our catering cities precisely. Under the brand name we will be running contests, sponsoring programme, etc. This will help us reach out to our target audience and the influencers.
· Outdoor:
Outdoor communication will be done to help us get the visibility i.e. with the help of Hoardings, which will be placed at areas that are prone to traffic jams and at toll Stations. Railway stations in Mumbai will be a good target area for such print media as it also has maximum visibility because majority people travel daily by trains to work. In respect of this media the company will be very selective.
· Posters:
Posters will be created by the company during the events and will be carrying the company logo, brand name and the picture and the tag line.
· Public Relation:
The company will be a part of events and/or will also be organizing its own events. The events will be chosen on the core values of community relation and whole family participation. The company will be a part of children and youth involving events like college/ school festivals, meets, etc and only use these as a platform to getting closer to their influencers and sample their product at a concession or commission basis.
· World Wide Web:
We will make our presence felt on the internet by hosting a website for the brand KiwiJoos which will be named “www.kiwijoos.com” which will;
§ The website will be imparting the information about our products, quality and values i.e. history of kiwi, its cultivation, its benefits etc.
§ Run online contests
§ Give health tips
§ Give recipes
§ Opinion section - person is free to express his thoughts and feedbacks
The website will be a tool to get closer to our customers and understand them better and will serve an entertainment and utility value.
Time frame:
An assortment of promotional tools will be used to increase visibility for KiwiJoos but the promotional activities will be concentrated differently with relation to the seasonal pattern in the country. India is a country with varying climate- winter, summer and monsoon (heavy in west coast between June and September where as in East coast during mid October to December). Though the promotional activities will be continuous throughout the year but the degree and combination will vary. This is intone to the perspective of the target market where it is noticed that soft drinks are consumed less during the winters and the monsoon period.
Marketing communication budget:
In the initial period the marketing communication budget approved by the company is Rs. 80 lakh to maximum of 1 crore. Later when our product portfolio is expanded i.e. within a span of one and a half years from commencing operation the company will adopt the percentage of sales method i.e. the company plans to spend 15% of sales on promotional activities.
Marketing Research:
During the development of the marketing plans, several focus groups will be used to gain insights about our customers. These focus groups will provide us with helpful insight, which will compliment the decision making process.
An additional source of dynamic market research will be the feedback mechanisms with the help of our website “www.kiwijoos.com” , the contests which the company will be a part of and the primary research which may be done by us or another party if felt the need or in combination.
These will be the steps which will be taken to understand the brands position in the customers mind and will serve the purpose of being close to our customer to understand him better. Shreeji Enterprises Pvt. Ltd will work hard in analyzing and implementing suggestions in order to improve its offerings aw well as to show its commitment to the customer and convey to them that their suggestions are valued.
