Demo marketing plan

1

MARKETING PLAN FORRUDRA FOODS PRIVATE LIMITED

2

Ready to Mix food markets is estimated to value at US$ 121.7 million in 2014 and expected to reach US$284.4 million in 2020. (Source: http://www.futuremarketinsights.com/reports/global-ready-to-eat-food-market )

CAGR of 15.7% during 2014 to 2020. Snacks mix has highest CAGR 15.9% followed by curry mix 15.8%. Potential of ready mix in South India market is 10000 mt/annum. Expanding at the rate of 15% per annum. Food is biggest consumption category in India and account for 31% of the

average consumer’s budget. South Indian consumers prefer traditional foods, they are ready to shift to

packaged foods if it is from their region. With a growing population and a growing middle class, market researchers

insist India has become one of the fastest growing markets for packaged food in the world.

Oligopoly market

NEW PRODUCT LAUNCH: INDUSTRY OVERVIEW

http://www.futuremarketinsights.com/reports/global-ready-to-eat-food-market

http://www.futuremarketinsights.com/reports/global-ready-to-eat-food-market

3

Industry Competitors Threat Level: Medium

Medium level of competition among existing players

Supplier PowerThreat Level: Medium

No differentiated product

Low number of supplier Does not depend

heavily on industry

Buyer PowerThreat Level: Medium

Industry products are undifferentiated

Low switching cost

SubstitutesThreat Level: High

More number of substitutes are available

Buyer’s cost of switching to the substitutes is low

Threat of New EntrantThreat Level: Low

High capital requirement

Low margin Competitive landscape

PORTER’S FIVE FORCES

4

Strength• Established brand name

in market• Adaptable & flexible to

new market trend• Good employee

retention• Expanding market

coverage

Weakness• Poor distribution

channel• Inefficient servicing• No regular monitoring

and visits• Irregular supplies• Increase in bad debt

Opportunity• High market growth rate • Growing middle class• Increase in disposable

income level• Increase in women

participation in job

Threat • Company is not

focusing on core activity (synergy between production ,demand, and supply) which is creating opportunity for the competitors to exploit Rudra’s food market.

SWOT ANALYSIS

5

S.T.PNeed based Segmentation

Need Identification India is one of the fastest growing economy. 65% of population of India is below the age of 35 years. Increase in number of jobs and No. of working women. Professionals are not getting time for cooking the food. Need of ready to eat food is felt.

Single Working men Demography: Live

in South India City: Live in Tier 1 Socio Economy

Classification: Belong to Category A1, A2

Single Working Women Demography: Live



Working Couple Demography: Live



Three segments were identified

Segment 1 Segment 2 Segment 3

Targeting Segment 1, 2 and 3 as they share similar characteristics so Rudra will target these three segments.

6

Indu Foods

Santhi Foods

Conventional User Rudra Food

Low Price High Price

High Quality

Low Quality

Perceptual Map of Ready mix products

CONT’D…

Positioning:POP: High quality product, Ready to eat,Long shelf lifePOD: Price, TasteUSP: Pocket friendly, tasty foodBrand Mantra: “Home like food in few minutes”

Next 3 years market potential in metric tons1st Year 2 nd Year 3rd Year10000 11500 13225

Marketing Strategy: We are entering into a new product segment, so need to generate awareness about products in consumer segments and ensure the availability of products in market, in order to accomplish these two tasks push and pull strategy will be use.

Push StrategyThrough this strategy our products will be flooded in to market by using multi channel marketing. Our products will be available to all those stores where competitors products are available.

Pull StrategyA intensive marketing campaign will be created during pre launch, launch phase of products so that customers become aware of our products and start demanding our products from various selling points.

7

MARKETING MIX

Promotion

Product

• Idli • Vada• Dosa (Various variants)• Upma• Curry Mix

Place

• South India Market• Tier 1 cities • Tier 2 cities

Pre Launch Launch Post Launch

Awareness Generation Mass social engagement

through Social Media Promoting our website

Print ad in Aval Kitchen Influencer relation

Trial creation Small sample sent out to

retailers Small sample sent out to

customer through newspaper

Awareness generation Press Release Television ads:- strategy-

Love, Pride Place advertising (Billboard) Buzz creation through social

media and Word of mouth Paid search marketing Print ad in Aval Kitchen

Trial Creation Live demo at events Free sample distribution

Monitoring Online contents eg: Blogs,

Social media, Youtube reviews

Consumer feedbacksSend market wave time to

time through TV ads, Social

media, You Tube, Print ads in Aval Kitchen magzine

Time to time give live demos

8

CONT’D…Price:

1st Year 2nd Year 3rd YearMarket Potential 10000000 11500000 13225000

Fixed Cost 50000000 55000000 60500000Variable Cost 55 57.75 60.6375

Price 100 100 100Break Even Quantity 1111111.1 1301775.1 1536995.9

Market Share 11.11% 11.32% 11.62%Various Price Case


Market Share 11.36% 11.59% 11.92%Price 95 95 95

Break Even Quantity 1250000 1476510.067 1760640.233Market Share 12.50% 12.84% 13.31%



Break Even Quantity 1666666.667 2018348.624 2483324.782Market Share 16.67% 17.55% 18.78%

Price 80 80 80Break Even Quantity 2000000 2471910.112 3124596.514


Break Even Quantity 2500000 3188405.797 4212358.573Market Share 25.00% 27.73% 31.85%


Market Share 33.33% 39.04% 48.86%

As from the table we can interpret that product can not be priced below 85 because as prices decreases required quantity for break even increases. If product is priced at 80 rupees then to reach at breakeven require at least 20% market share in first year and 24% after three years. Getting this much share is very tough to achieve. So product can not be priced below 85.

Best price for this product is 95 rupees as it is giving us psychological advantage over competitor as it is below 100 rupees and providing achievable market share target which is approximately 13%..

The method use for pricing is going rate price of market.

9

PRODUCT STRATEGY Core benefit• Food

Basis Product• Eatable food

Expected Product• Packaged eatable food with

property of ready to eat

Augmented Product• Higher shelf life

Product Levels

Product Differentiation: Product will be differentiated in ‘form’ and ‘superior performance’ quality.Form: Attractive packaging which will reflect the company and brand image and can create a billboard effect in shop. Those method of packaging will be use which can increase the shelf life of product. Labeling: Label will give the information about the brand and product.Product bundling : Product bundling will be done initially for increasing the trail rate of new products. A small pack of products will be given free for a big product. This will help to increase awareness and trail rate of products in consumers.

10

MARKETING CHANNEL

Manufacturer Wholesaler Retailers Customers

Multichannel marketing system will be used to sell the products in the market through collaboration with e-retailers (Big Basket, Groffers, Baniya wala) , retailers, multi retail outlets(Big Bazaar, D Mart).

Two level channel: As this is a new product in the market, we need to involve wholesalers into distribution network. Wholesalers will help to create availability of product in market. (Push Strategy)

Zero level channel: A restaurant will be open in Bangalore to show demo of products in front of customers. All the foods serve in the restaurant will be made by using ready mix products. This will help to increase the customer base and improve the loyal customer base.

Manufacturer Customers

Intensive distribution mechanism will be use to flood the products into market by keeping goods in as many outlets as possible. This will help to create the push in the market.

Company will try to establish ‘Administered Vertical Management System’ in upcoming future as presence of our brand will increase over the period of time. This system will able to us harness more profit from the market.

One level channel: This channel will be use to sell products with e-retailers and multi retail outlets. This channel will help us to make our products available at emerging selling markets.

Manufacturer Retailers Customers

11

THREE YEAR PLANAssumptions: 2 crore will be invested as

capital expenditure. Depreciated at the 10% . Sales are increasing at the

rate of 20% every year. First year sale is 6% of total

potential market. Second year sale is 9% of

total potential market. Third year sale is 12% of

total potential market. Operating working capital

5% of sales. WACC is 10%

Capital Investment 20000000 1 Year 2 nd Year 3rd Year

Unit Sold 600000 1035000 1587000Sales Price 95 95 95

Sales Revenue 57000000 98325000 150765000Variable Cost 55 57.75 60.6375

Total Variable Cost 33000000 59771250 96231712.5Fixed Cost 50000000 55000000 60500000

Depreciation 2000000 1800000 1620000

EBIT -28000000 -18246250 -7586712.5

Taxes (on operating income 30%) 0 0 0

NOPAT -28000000 -18246250 -7586712.5

Add Depriciation 2000000 1800000 1620000

Operating Cash Flow -26000000 -16446250 -5966712.5

NOWC 2850000 4916250 7538250 0Cash flow due to NOWC -2066250 -2622000 7538250

Salvage Value 14580000

Net Cash Flow -23933750 -13824250 1075037.5

PV -22850000 -21757954.55 -11425000 807691.5853NPV -55225262.96

NPV is negative because we have taken only three years as operation years but it will become positive in 7 years if we consider 3% growth in market share every year .

Due to less period of time we are getting negative NPV for the project.

12

THANK YOU

Demo marketing plan

Marketing

Transcript of Demo marketing plan