Cosumer Behavior Salt Bangladesh

7/23/2019 Cosumer Behavior Salt Bangladesh

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CONTENTSExecutive Summary ....................................................................................................................................................... 3

Industry Background ...................................................................................................................................................... 4

Product Background: ACI pure salt ................................................................................................................................ 4

Objectives ...................................................................................................................................................................... 5

Broad Objective ..................................................................................................................................................... 5

Specific Objectives ................................................................................................................................................. 5

Scope ............................................................................................................................................................................. 5

Methodology ................................................................................................................................................................. 5

Primary Sources ..................................................................................................................................................... 5

Secondary Sources ................................................................................................................................................. 6

Limitations ..................................................................................................................................................................... 6

Target Market ................................................................................................................................................................ 6

Cultural Factors.............................................................................................................................................................. 6

Gender Factors .............................................................................................................................................................. 6

Consumers Perception .................................................................................................................................................. 7

Exposure: Deliberate ............................................................................................................................................. 7

Attention: Low Involvement .................................................................................................................................. 7

Interpretation: Cognitive ....................................................................................................................................... 7

Memory: Schematic ....................................................................................................................................................... 7

Short Term memory .............................................................................................................................................. 7

Positive Perception ................................................................................................................................................ 8

Negative Perception .............................................................................................................................................. 8

Learning ......................................................................................................................................................................... 8

Group Influence ............................................................................................................................................................. 9

How branding helps on buying behavior ....................................................................................................................... 9

Branding of ACI pure salt ....................................................................................................................................... 9

Branding of Necessity Products ............................................................................................................................. 9

Positioning of Necessity Goods ........................................................................................................................... 10

Branding as Iodized Salt..................................................................................................................................... 10


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Branding as Vacuum Evaporated Salt ................................................................................................................ 10

How Branding Beats Competition for ACI pure salt............................................................................................. 10

How ACI pure salt Measures Brand Performance ............................................................................................... 11

Current Shelf Coverage and Current Sales .......................................................................................................... 11

Long Term Brand Vision ....................................................................................................................................... 12

Bridge between Consumers Needs and Product Benefits .......................................................................................... 12

Motives for Choosing ACI Pure salt ............................................................................................................................. 12

Situational Influence .................................................................................................................................................... 12

Temporal Perspective .......................................................................................................................................... 12

Task Definition ..................................................................................................................................................... 12

Ritual Situations ................................................................................................................................................... 13

Emotional Appeal ........................................................................................................................................................ 13

ACI Pure Salt as a Lifestyle Brand ................................................................................................................................ 13

What advertising and promotional programs can positively influence consumer behaviorError! Bookmark not

defined.


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EXECUTIVE SUMMARY


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INDUSTRY BACKGROUND

A daily commodity salt produced in Bangladesh mainly by a process of drying up seawater by solar heat,

although the lixiviation technology is also in use to manufacture about 5% of the production. Salt was

manufactured in Bengal as an indigenous product along a line of seacoast extending from Cuttock to

Chittagong. The Malangies were the primary producers of salt from the seawater.

The salt producing areas were in coastal belt ofCHITTAGONG,NOAKHALI,BARISALandKHULNAdistricts

and the offshore lands. Production fluctuated from year to year due to natural calamities, variations in

rainfall and changes in the terms of land lease. After liberation of Bangladesh in 1971, the Bangladesh

Small and Cottage Industries Corporation took up the task of developing the industry. It launched a Tk 13

million project supplemented by a subsequent UNICEF assisted Tk 22.6 million program. The salt

production, however, never reached the pre-independence level and was only 696 tons in 1994

necessitating the import of 328 tons. Of the total available quantity of 1,023 tons, 666 tons was for

household consumption and the remaining was for industrial purposes, mostly inTANNERY. (Habibullah)

At present yearly salt consumption is more than 1.4 million tons according to the BSCIC (BangladeshSmall and Cottage Industries Corporation) data but the actual demand is around 1.8 million tons including

food and industrial purposes. Some 1.16 million tons of salt were produced until May 18, 2012 at the

season end while the target of production was 1.450 million tons for the fiscal year (2011-12), according

to the BSCIC. (Moni, 2012). From the preliminary reports of the Bangladesh National Nutrient Survey

2012, 57.6% of households are consuming adequately iodized salt (15 ppm), 80.3% of households ore

consuming salt with some iodine (5 ppm) and 75.8% of the households are consuming packet salt .

Currently most prominent salt brands are:

ACI pure salt Fresh Salt Molla salt Teer Salt Meghna Salt Confidence Salt

PRODUCT BACKGROUND:ACI PURE SALT

In this report we are going to work with ACI pure salt from ACI limited. ACI pure salt was launched in

August 2005 and marketed and distributed by ACI consumer brands and its network. ACI has set up its

salt refining plant in Rupganj, on the banks of the Shitalakhya River. The plant produces refined iodizedsalt through Thermal Evaporation System. ACI has used technology from China Heavy Machineries

Corporation (CHMC) in establishing the plant. The end product will be high quality, free flowing salt

with even, crystallized grains. The iodine content of ACI pure salt will have a stability of more than 6

months. The project had been undertaken at a cost of approximately taka 32 crores. Within a very short

period it has been enjoying the pride of being the leading brand. The best in its kind, ACI pure salt is

vacuum evaporated, free-flowing and properly iodized. It is also very porous and free flowing. Iodine is

coated in every single grain which makes it an essential product for the children. The absence of right
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quantity of iodine in their food may cause mental disability to them. ACI pure salt has won the BEST

BRAND OF BANGLADESH AWARD 2008 for unparalleled customer loyalty beating all the brands in

Foods and Beverages category.

OBJECTIVES

Keeping in mind the instructions for this report, we have formulated the following two types of

objectives:

BROAD OBJECTIVE

To understand consumer behavior of Bangladeshi consumers of the edible salt brand ACI pure salt

Limited and to create a clear picture of the how this understanding is implemented in the market.

SPECIFIC OBJECTIVES

To gain an understanding of the industry, company and product To understand the target market along with their social, cultural, psychographic and other features To evaluate customers perception of the ACI pure salt brand To understand the process by which ACI pure salt beats competition To understand how the brand fits into the lifestyle and self-concept of its consumers To see how the understanding of consumer behavior is implemented in branding through

advertising and promotion

To see how such branding results in positive performance and market leadership SCOPE

The report will present an assessment of how the consumers of ACI pure salt respond to various

advertising and promotion endeavors of the brand. It gives a brief needs assessment of the consumers of

salt, a succinct overview of factors affecting consumers of all salt brands. The report also digs into the

competition among the salt brands and the unique positioning of ACI pure salt in order to beat the market.

The report will mainly be based on our interviews with industry specialists and will also contain some

secondary research.

METHODOLOGY

The information used in this report were collected from both primary and secondary sources.

PRIMARY SOURCES

The primary research information was collected from our visit and subsequent interview with Mr.

Quamrul Hasan who is a brand manager of ACI pure salt Limited. We also conducted a telephone

interview with Mr. Rubayet Chowdhury who is a Business Manager forTeer Salt in order to gain a

better perspective of the industry as well as of the competition. We conducted a small survey on people in

the Aambagan area of Dhaka city among heterogeneous consumers. We conducted an online survey in

which we got 88 respondents. The questionnaire is attached in the appendix section.


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SECONDARY SOURCES

The secondary sources included various websites on the internet, our text book, and research journals

available on the internet. It includes previous cases, newspaper articles and reports as well. The secondary

research laid the foundation for us to have a knowledge base strong enough to go into primary research.

LIMITATIONS

There were several limitations that hindered the smooth completion and effectiveness of the final report:

The company being very specific, there was hardly any secondary information available

Lack of previous knowledge about the salt industry

Limited amount of time available for the completion of report

Busy schedule of interview able executives

Lack of direct links in the salt industry

TARGET MARKET

Salt is a necessity item. Broadly everyone is the consumer of salt. But the purchasing decision is usually

made by the male or the female in the house who does the grocery shopping. From a market point of view

primary target market for ACI pure salt is , Lower Middle, Middle and Upper class. They are farily

educated and use iodized salt. They form 65% of the market. They prefer health and well being over price

when it comes to purchase of salt. Another The market price of iodized salt is more than double that of

non-iodized salt. So the lower middle class usually goes for cheaper, loose packed non iodized salt. They

form roughly 35% of the market. Price is a very importan factor for this class.

CULTURAL FACTORS

The lower class segment usually eat more salt in their curry. They also eat extra salt with rice and chilli. Asmall portion of them use salt to brush their teeth.

In general, all socio economic segments use salt also with traditional pickles, lemonades and baked pithas

in addition to regular curry and meal. Some devout muslims consider eating a pinch of salt befor meal to

be sunnah.

GENDER FACTORS

All though it is the females who usually cook at home, in predominant number of households in

Bagnladesh it is still the males who carry out the grocery shoppings. But purchase decision of salt in

terms of brand choice and amount is made by female. The trend is high in urban families where femalesdo the grocery shopping. The bottom of the line is buying a salt brand tends to be a marginal decision

making process and is made at the time or grocery shopping. However females in families other than in

the lower income group, categorically state the need for iodized salt and the brand choice if it is not being

used already in the family.

In additon to using salt at home, the large number of restaurants and bachelor living hostels through out

the country predominantly use male cook and the grocery purchase is made by the males.


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CONSUMERS PERCEPTION

EXPOSURE:DELIBERATE

Consumers in Bangladesh treat salt to be an indispensable part of their diet. One consumer in our survey

said, Eating meal even with ghee( butter) doesnt taste good if there is no salt..It becomes a habitual

process to consume salt. ACI pure salt puts in a moderate effort to attract new customers and retain theold ones. Some of their efforts to enhance ACI pure salts exposure are-

TVCs Advertisements on first and third page of national dailies (Sample Provided on appendix) Sponsoring different public events like ACI pure salt (Pictures provided

on appendix)

Using social media e.g. Facebook fan page

All of these are intended to maximize the random exposure to ACI pure salt. Mother company ACI hasalso a well-established website containing product information.

ATTENTION:LOW INVOLVEMENT

People usually come to know about salt as a product subtly in a subconscious manner from childhood

from their various social intereactions. They cannot recall when exactly they recognized salt as a product

or saw the first salt advertisement. However they all distinctly remember having seen advertisment for

salt and heard of the importance of eating iodized salt. From our survey we found that the recall rate for

advertisement and also the influence of advertisement on the pruchase decision of low income consumers

is minimal.

INTERPRETATION:COGNITIVEACI pure salt emphasizes on their quality. From our survey we found that most people associate ACI pure

salt with semantic meanings such as Pure, clean. Affective interpretation is observed to some extent

with their emotional appeal pointing towards how ACI pure salt will help to build an intelligent

Bangladesh.

MEMORY:SCHEMATIC

The memory building process of ACI pure salt is more schematic rather than episodic or semantic. They

do not relate to specific events or situations. The basic perception of the brand name ACI pure salt

specifically related to various concepts such as: Clean, Pure, Iodine.

SHORT TERM MEMORY

Since ACI pure salt salt is a low-involvement product, short-term memory will work here. To have thebrand name in short-term memory following things have to be done: Increase the number of ad insertion

and increase product visibility.


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FIGURE 1 PERCEPTUAL MAP OF ACI PURE SALT AND ITS COMPETITORS

POSITIVE PERCEPTION

The positive perception that the consumers have about ACI pure salt are:

Pure Clean Good packaging

NEGATIVE PERCEPTION

On the other hand there is some negative perception among the customers that was found in the consumersurvey. They are:

Expensive No efficient communication

LEARNING

Usually the buying process of good is exposed to the product then building the attitude about the product.

Then comes the final purchasing decision. But in case of low involvement product thats different. Peopletends to exposed to the product, in second step they buy the product. Last step is the attitude building


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phase.

GROUP INFLUENCE

From our survey among 88 respondents 62.57% of the sample population chooses ACI pure salt because

of the influence of female member of their family mostly mother. On the other hand, none of respondedtowards neighbor or friends..

From this data, it can be concluded that the decision of buying ACI pure salt is totally individualistic

decision. In most of the family females are buying decision makers.Since salt is a low-involvement &necessity product, reference group will not have influence on the consumers.

But because of limited information of the consumers regarding the ingredients of salt some reference

groups e.g. Doctors.

HOW BRANDING HELPS ON BUYING BEHAVIOR

BRANDING OF ACI PURE SALT

ACI pure salt obtained the BEST BRAND AWARD 2008. So we dug deep into the factors that enabledthem to obtain this leadership and become the best brand. They are described as follows.

BRANDING OF NECESSITY PRODUCTS

The surprising fact about necessary goods is that branding that is done through TVC and print media has

very little and almost negligible effect over current sales. It only establishes a meaning for the brand to

communicate the features and to charge the additional price that they charge for those features. The

additionally chargable price is also limited for necessary goods due to frequent government pressures to


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keep prices within limits because commodity prices is one of the biggest political issues of our country.

Also, it is unlikely that a consumer will pay a huge margin due to an investment intensive branding

endeavour when it comes to necessity products.

POSITIONING OF NECESSITY GOODS

The salt brands of necessity goods like Teer and ACI use leveraged positioning. This means that theycreate a single positioning strategy for their universal brand name and position all the product categories

under that brand name with that strategy. For example, Teer positions itself as healthy for all its

categories. Again, you can get ACI Pure Salt as well as ACI Pure Gura Moshla in the market, where

the marketing team of ACI is trying to position ACI as a pure alternative.

BRANDING AS IODIZED SALT

Nowadays, almost all major salt brands of our country brand their salt as iodized salt. Iodine is a

micronutrient often present in the food supply of coastal regions. It is a mineral necessary for various

physiological activities. Iodine deficiency, which affects two billion people worldwide is the leading

preventable cause of mental retardation. Before ACI pure salt was introduced, ACI Pharmaceuticals were

their predominant industry. Consequently, ACI was the first to introduce Iodized Salt branding.

ACI claims that every single grain of their salt is covered with a coat of iodine. The funny thing about

iodized salt is that most of the iodine gets evaporated in the air if it is provided with substantial amount

of time in exposure to the atmosphere. This is because iodine is a volatile substance. Hence, it salt is not

covered, iodine is lost.

BRANDING AS VACUUM EVAPORATED SALT

Nowadays, almost all major salt brands of our country use vacuum evaporation methods to manufacture

their salts. This is the latest technology available. The benefit from this technology is that it makes the salt

capable of being stored for longer amounts of time. However, such a feature is of no major advantage or

utility to the consumer. So, branding of this feature is only a whitewash on consumers eyes. It works togive the impression of usage of state of the art technology and thus adding to their brand equity. ACI salt

does not directly say in their communications that they use vacuum evaporation technique. So this is a

scope they can utilize in the future.

HOW BRANDING BEATS COMPETITION FOR ACI PURE SALT

ACI pure salt executives believe that the following factors play a significant role in forcing customers to

use ACI pure salt instead of other brands:

Strong predominant image of ACI brand The unique positioning of ACI as pure product

The truth about necessity products however is that only 10% of the market are brand loyal and it is only in

posh areas that people actually ask for a specific brand. So how does ACI pure salt beat competition? It is

by branding in two media which are much more important than print and electronic media when it comes

to such products. They are:

Dealers as a media Retailers as a media


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Retailers increase sales by proposing a brand at the time of purchase. They propose those brands which

give them higher margins and provide negative information about those brands which give them less

profit margin. So, ACI pure salt gives retailers a competitive profit margin to beat competition.

Another important effective branding aspect about retailing is Brand Visibili ty. It is done in two ways,

viz.:

Modern Tradewith Super Shops Congenial Corporate Relationswith Retailers

Modern trade is creating visibility and better placement of products in super-shops through negotiation,

relationship building, etc. Also, Gondola Rentingcan be done to have dedicated shelves in super-shops.

Super-shops now-a-days position all their products by calculating the maximum margin they can obtain

from every inch of their shop.

/Corporate relations with retailers are maintained by providing them with Panaplexesat the companys

cost. Retailers are provided with competitive profit margin and encouraged to keep as much stock of ACI

Pure Salt as possible. So, when a customer sees a huge stock of this brand in a retail shop, it is branded

positively in his mind.

HOW ACI PURE SALT MEASURES BRAND PERFORMANCE

ACI Pure Salt measures Brand performance based on the following criteria:

Market Share TRP of TV Commercials Retail Shop product visibility Volume of customer query about brand at retail level Super Shop visibility

The performance of ACI Pure Salt can be said to be brilliant due to their attainment of market leadership

status and achievement of BEST BRAND AWARD 2008. Other performance is measured by monitoring

customer purchase behaviour say just after a launch of a new marketing campaign. Marketing research

teams are regularly sent to the field to monitor retail shop visibility, super shop visibility and customer

query. ACI Pure Salt has been doing well in almost all categories.

There are two motives with which ACI pure salt brands itself. These are Current Shelf Coverage and

Long Term Branding Vision. They are described as follows:

CURRENT SHELF COVERAGE AND CURRENT SALES

It is a surprising fact that Integrated Marketing Communications (IMCs) play very little role in the sales

of necessity products like salts. They barely attract only 10% of customers as loyal customers and

customers usually do not ask for a particular brand at the shop. They are only usually able to identify

between iodized and non-iodized salt based on learning from their communications. Shelf coverage and

sales is thus rather driven by distribution efforts, like relationship building, negotiations and


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incentivization of retailers and dealers. Whereas current sales is driven by retailers. Necessity goods are

of high demand so IMCs do not need to create demands either.

LONG TERM BRAND VISION

Since IMCs serve very little purpose in shelf coverage and current sales, a question arises that why ACI

Pure Salt engages in IMC and incurs such costs. It does so because of their long term vision. It establishesthe brand in the minds of people who are brand consciousand non-buyers nowso that when they

become regular buyersin the future, they would prefer this brand.

BRIDGE BETWEEN CONSUMERSNEEDS AND PRODUCT BENEFITS

ACI pure salt provides the target market with simple solutions for their daily need of necessary ingredient

for cooking, which fit with the contemporary culture. ACI pure salt gives consumers the confidence of

knowing that they are making the right choice. It gives them a greater sense of involvement and control,

as well as guaranteed success and appreciation that ACI provides necessary iodine needed for their family

members. They provide the sense of pureness among the consumers.

Through providing the mothers with these benefits, ACI pure salt allows consumers to achieve their

ultimate motive that is, providing their family members pure and iodized salt, on a regular basis, without

having to compromise on anything else.

MOTIVES FOR CHOOSING ACIPURE SALT

85% of the respondents in the primary survey said they consumed ACI pure salt. When the respondents

were asked about the aspects of ACI pure salt that they prefer most, a formidable 35.23% chose it because

ofPureness and 30.7% because of Cleanliness

It can be understood that the manifest motive behind the consumers choice of ACI pure salt is the

quality. Consumers believe they can receive a good quality which they value most.

According to Maslows hierarchy of needs, ACI pure salt involves fulfilling physiological needs (daily

commodity), as well as esteem need (desire for premium and better quality).

SITUATIONAL INFLUENCE

Though situational influences play important roles in consumer buying decision making process, a

product like salt has fewer influences as such since it is a must consume product.

TEMPORAL PERSPECTIVE

Consumers spend 0 to 30 seconds at maximum regarding information search on different brands of salt.

Retailers play the key role in educating the customer of the brand during this timeframe.

TASK DEFINITION

Salt is bought for cooking purposes. They are used to make pickles. Bengali housewives sprinkle their

magic(salt) to impress family members. Tasting salt is often used for this purpose. Other than that, salt is


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also used for brushing of teeth by consumers in rural areas. The first being the dominant, the other task

definitions are negligible.

However, the task definition communicated in the TVCs of ACI Pure Salt is the maintenance of stable

intelligence through salt consumption.

RITUAL SITUATIONS

Salt consumption increases during the Ramadan season where various spicy and salty snacks are prepared

everyday for iftar. Thus, tradition has an influence on the volume/frequency of purchase.

EMOTIONAL APPEAL

ACI pure salt does not appeal to the emotions of the target market rather lets the customers decide and

gather cognitive knowledge about their quality and then make a choice. Thus they dont resort to

emotional appeal by showing an ad of sick person and try to state that without ACI pure salt someone will

be sick.

ACI PURE SALT AS A LIFESTYLE BRAND AND SELF-CONCEPT

A product often takes a part in the lifestyle of the consumers as an essential. ACI pure salt being the top

of the brands serves as a premium material for cooking and food products. An everyday necessity doesnt

just fill in the lifestyle as a nutrient value but has a knack of being the image of the lifestyle too. The

target market that ACI pure salt holds on not just consume it through a prepared recipe but also views it as

the brand which suits their value and needs.

The self-concept that they believe in is highly influenced through the essentials they use. ACI pure salt

being at the core of the daily needs for the consumers does exactly the same to the cooks or the eaters as a

Ferrari would do to a car lover. ACI promotes itself as a brand creating peoples concept a bit better for

salts and relating the image of its premium product to consumers lifestyle.

ALTERNATE EVALUATION AND SELECTION

There are other competitive brands in the market like Molla salt, Fresh salt and confidence salt.Choosing ACI pure salt is more of an Brand extension to rural market

Free Offer Packaging Field Activation Push Sale Strategy

choice than an attitude based choice. The target market, despite having different importance factors,

usually considers the following evaluation criteria:

Quality - this involves whether the quality of salt reflects the desired outcome of the customers. ACI pure

salt emphasizes on quality from the very beginning. The cleanliness and pureness is satisfactory.

Although the price is higher than the other existing brands target market usually go for quality over price.


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RECOMMENDATIONS

More than 35% of households in Bangladesh stilldo not use iodized salt. They belong to the low income

rural class. Price is the most important criteria in theirpurchasing decision calculus. To get them started

to using ACI Pureiodized salt,the following activities are suggested:

1. Introduce low priced brand extensions for ruralmarket.2. Free Offer: To create a purchase drive offers a steel spoon free with every pack. For a rural

household a spooncan be a high impact show of gesture and is a needy item.

3. Packaging: Extend the benefit chain. Packagethe salt in plastic container which rural householdscan later use to storeother edibles.

4. Field activation: Execute publicity stunts invillage school playgrounds with projectors projectinga entertainment fiction where Bangla cinema celebrities through the story endorse using the

iodizedsalt brand. Such models have been carried out by Bangladesh government successfully to

propagate female education in rural areas.

5. Since salt low involvement purchase behaviorPush sale strategy should be deployed. A majorityof consumers simply purchasethe salt brand/type suggested by the grocery. Hence groceries must

be given anadditional commission to vouch for the product.

CONCLUSION

TAKEAWAYS

EXPERIENCE RECAP

While working for this term paper, we were exposed to a wide array of information regarding ACI, ACI

pure salt and consumer behavior. Salt is a daily commodity. We have it every day, but we had no idea that

so much thought went into the making of a single product.

Our interviews with the customers helped us understand their expectations from a Salt. Also, we were

able to analyze their motives, buying behavior, group influences and other psychological factors which

influence their behavior. The interviews with the past consumers helped us in understanding the

weaknesses of the brand.

Finally we come to the main objective of this term paper: understanding consumer behavior. This

undertaking of ours helped us understand how marketers are applying the concepts of consumer behavior

every day in every way. Lastly we were able to use our own judgment and knowledge gained throughoutthe course to understand the current condition and also provide some feedbacks.


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BIBLIOGRAPHY

Habibullah, M. (n.d.). http://www.banglapedia.org/HT/S_0045.HTM. Retrieved from Bangladpedia.org.

Moni, S. H. (2012, 06 16). http://www.thefinancialexpress-bd.com/more.php?news_id=133150&date=2012-06-16.

Retrieved from Financial Express.


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APPENDIX

PROMOTIONAL ACTIVITIES OF ACI PURE SALT


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CONSUMER SURVEY

SURVEY QUESTION

Here is the consumer survey that we carried out inhttp://www.surveymonkey.com/s/W7TPNPX
http://www.surveymonkey.com/s/W7TPNPXhttp://www.surveymonkey.com/s/W7TPNPXhttp://www.surveymonkey.com/s/W7TPNPXhttp://www.surveymonkey.com/s/W7TPNPX


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SURVEY RESULTS


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Cosumer Behavior Salt Bangladesh

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