New Product Launch

NEW PRODUCT instal UB GROUP SOFT DRINK MIST COMPANY OVERVIEW United Breweries contain (UBL) has assumed undisputed food market place leadership with a national market shargon in excess of 50%. Through a a merely of aggressive acquisition and market penetration, The UB Group today controls 60% of the add together manufacturing capacity for Beer in India. The flagship defacement, Kingfisher is now sold in over 52 countries worldwide having received many accolades for its shade. MACRO-ENVIRONMENTAL ANALYSIS Political Factors The political forces put on the beer industry to a too large extent.The rates of the beer in various separate of the country ar affected by the taxes and duties applied by the Govt. The political forces a homogeneous affect the pricing of the beer by lowering the duties or relieve the distri yetion channel. This leads to lower margins for the scattering channel partners. But, as 75% of the Indian market is covered by two players, there hasnt been a reduction in the margins of the manufacturers. The taxation policies also affect the exercise patterns. economic Factors India is home to nearly whiz-sixth of the global population and is one of the some attractive consumer markets in the world today.The total worth of Indian Beer merchandise is Rs 750 crore. This market is expected to expand by 39% by 2010. The beer consumption has been growing at a CAGR of 7% over last club years. India renders attractive profit margins imputable to the consolidated record of the industry. Various search studies fork up shown that a rise in the income aims has a direct imperative impression on beer consumption. The National Council for Applied Economic Research (NCAER) projects Indias in truth rich, consuming and climbers classes to grow at a CAGR of 15 per cent, 10 per cent and 2 per cent respectively.Thus, India gives ample opportunities for the UB Group to grow. Social Factors A deep-seated conventional social aversion to alcohol consumption has been a traditional indication of the Indian society. However, as urban consumers become to a greater extent(prenominal) exposed to Hesperian modus vivendis, by dint of overseas travel and the media, their attitude towards alcohol is relaxing. Social habits argon undergoing a transformation as mixed drinks are becoming more popular. The greatest evidence of this trend is the increase in beer consumption among women. more than and more women are consuming beer the penetration in metropolitan areas is most twice as high as the penetration in a nonher(prenominal) large cities implying that the greater tolerance towards alcohol consumption in metropolitan areas facilitates the consumption of beer. With increasing urbanisation, this acceptance is only going to rise. As a consequence of the high birth rates prevalent until the 1990s, a large proportion of the Indian population is in the mount congregation of 20-34 years. This age group is the most appropriate tar get for beer marketers. This population trend testament give a further boost to the evolution of beer consumption in India.Technological Beer industry is not technology specific. As the UB group is one of the oldest players in the market, they deplete achieved economies of scale. Thus, technological factor is not of great splendor for the beer market. SWOT ANALYSIS PORTERS FIVE FORCES MODEL scourge of in the raw Entrants Low In India, beer industry is growing with 11% CAGR betray it attractive for new players. Strong brands same(p) Kingfisher and Haywards which are already handed and have real brand recall leave behind farm it tough for new entrants and they are expected to struggle to expand their consumer abode as they try to penetrate the beer market in India.Foreign brewers have been eyeing the Indian market for some years now since India is widely hold to be the last untapped big growth market. Several transnationalist brewers have built brand associations an d are marketing their brands aggressively by dint of with(predicate) various point-of- sale promotions throughout their distribution networks. But with strong players in the market any new entrant will face problems of a) Economies of scale For example benefit associated with bulk bribes and sales create high barriers to the national and global markets ) follow of entry For example investment in technology, be associated with sales c) Distribution channel For example ease of access for competitors d) governing Legislations -Introduction of new laws might weaken have adverse effects e) specialism For example certain brands that messnot be copied f) Supplier power Possibility of away integration by supplier Bargaining power of suppliers Low cod to increasing represents of raw material and decreasing be of barley suppliers, bargaining power of suppliers was high but by doing backward integration, through by acquiring Maltex Malsters Ltd. and shifting their fruition of beer on malt the federation has achieved a hold on its raw material and considerably cut back supplier strength and dependency. Company has also entered into collaboration with Government of Punjab and Haryana for supplying of its raw material. Bargaining power of buyers Moderate This factor measures the extent to which nodes are successful in forcing footings down, or securing high quality or more service at the same price. Customers tend to be powerful when the quantities they purchase form a large portion of the sellers total sales.Buyers do have a in truth clear understanding about the quality and as there are very few players in the market the customer freighternot influence the price in any signifi back tootht way. But speckle this is true a decline in consumable income shifts consumer preferences away from exchange premium brands to lower-priced brands since the switching costs is low. Due to this the bargaining power of buyer tends to increase. affright of substi tutes Moderate India is predominantly a spirits market and beer has traditionally been a minority preference for those who consume beverage alcohol. hence substitutes are the biggest affright as preference for beer among alcohol beverage drinkers is less but also the low penetration in beer consumption in comparison to international levels offers the potential for substantial and sustainable growth in demand for beer in India for years to come. Rivalry amongst Competitors Low to Moderate Rivalry is the means through which competitors fight for position by using tactics such as price, competition, advertisement battles, and new ware introduction, to lower the profits of competitors in the industry.As stated to a higher place CAGR of 11% is expected for beer in the next 5 years due to which many MNCs are eyeing the Indian market. Currently the major(ip) rivals for Kingfisher Premium are Budweiser, Carlsberg, Foster and Tiger and for Kingfisher Strong its Hayward 2000, Hayward 500 0, Palone. SABMiller who came to India by acquiring small breweries and has made its hold as best-selling strong beer brand but still Kingfisher has managed to remain the largest-selling strong beer brand with 29% market share. There are also some small local anaesthetic players hat are in the market but are not much of a threat to Kingfisher. STRATEGIC FIT OF MIST WITH join BREWERIES GROUP The UB Group (United Breweries Group) is a multi-faceted conglomerate with business interests in drink Alcohol, Pharmaceuticals, Media, International Trading, Aviation, Fertilizer, Research & Development, and Infrastructure Development with a major localize on the brewery (beer) and alcoholic beverages industry most of which is marketed under the Kingfisher brand. UB Group is already planning to venture into the mineral water segment via the Kingfisher Himalayan peeing Brand.Thus strategically thinking Mist will be a perfect fit in the UB Groups expansion plans. In fact introduction of a ov erstuffed drink will make UB Group present in all versions of drinks and will be a wonderful way to reach out to customers who admire the Kingfisher brand but do not consume alcoholic beverages. Launching Mist will be a form of line extension and will servicing it respond to customers of necessity favorably. If we see the attributes of Mist, i. e. adventure, energy, fun and the assume Ke attitude it is very much in sync with the existing brand image of UB Group.Mist organism a soft drink, it is very necessity to ensure proper distribution of the increase. This is where UB Group can use its midpoint competency of having a strong distribution network and bank upon its write up regarding the stringent quality control measures it follows. Also if we look at the soft drink market, the only direct competitor of Mist is Mountain Dew and the market for soft drinks providing the set of benefits as Mist is in a growth stage. That makes it a perfect moment to introduce a drink like Mist under the Kingfisher brand name.Considering the sync between Mist attributes and Kingfishers brand image, we can also use the events held by the UB Group like the Derby, Kingfisher Calendar, IPL matches , functions like the Incredible India Party held last year at Cannes and the TV channel NDTV Good Times to increase sentience about Mist. It can make use of the cricket and Bollywood stars already associated with Kingfisher brand to endorse the product and help build a strong connect with its loyal customers. Added to that helping Mist in the Kingfisher Airlines will be a reat way of fashioning future customers try out the drink. PRODUCT INTRODUCTION Mist is a soft drink that is being launched by UB group under Kingfisher brand. It is a citrus flavoured drink and unlike different soft drinks, it is more change and has high levels of caffeine. MARKETING STRATEGY SEGMENTATION Demographic Segmentation 1. AgeA consumer needs and wants change with age. Hence this segmentation is impo rtant for this product. On the basis of age, we can divide the population into the following categories a. 6-25 years b. Teenagers c. 25 years and supra 2. Gender This is an important segmentation since both genders behave and respond separatewise(a) than to same situations. Geographic Segmentation This segment primarily refers to the location of the segments. For our product there will be three segments. a. Urban b. Semi-Urban c. Rural PsychographicSegmentation hither contrasting groups are identified on the basis of personality traits, lifestyle or set. The following segments can be formed a. Excitement, lay on the line seeking, gamble lovers b. Health Conscious . Rebellious d. Fashsionable and stylish For our product, we can begin with demographic segmentation. These segments would be further divided using psychographic segmentation. The product is soft drink, but we will not go in for bay window marketing and quite target ground on psychographic segmentation. The targe t would also be different from those of already existing soft drinks. TARGETING Evaluating the above segments on the parameters like Measurable, Substantial, Accessible, differentiable and Actionable, the target segment for MIST would be Individuals (both genders) in age spue 15-29 in urban areas (this is because the promotional activities would be focused on urban areas only). Based on market seek data, we decided to target race who embrace excitement, adventure and fun. Reasons for choosing this target segment are Our market research showed us that there were primarily five different target groups in the market. There was considerable presence of other soft drinks in the other target groups. Also in urban areas there are very few individuals in the age group 15-29 years who have not heard of Kingfisher hence this would be our target age group.This segment in India is substantial and would be profitable. Kingfisher already has large distribution networks for selling its othe r products in urban areas. Hence there would be little cost of adding distribution channels. It is also easier to involve people from the aforementioned age group in various promotional activities and also they are easily tender through internet. So it would be easier reaching across to them. POSITIONING conspicuous Attributes Offer from the Kingfisher brand Higher price for perception of premium quality and difference Available only in stylised cans Invigorating effect due to higher caffeine Tingling taste and flavor dandy availability in retail outlets, pubs, clubs, discos and other socializing places Values Adventure Seeking Thrill Different from competition Aspiration for youngsters to be associated with Kingfisher brand. competitor Mountain Dew As compared to Mountain Dew, we will position MIST as an exclusive brand and it will only be available through selective outlets.We are going for appreciate-based offering that is premium in nature due to higher quality a nd reflects the values of inspiration for Kingfisher. Coke and Pepsi twain Coke and Pepsi are brands that differentiate themselves on the basis on the endorsements eg. Pepsi targets the juvenility market through endorsements from young celebrities. Price is not a discriminating factor between these two. We shall charge a higher price as compared to Coke and Pepsi and put forth quality as a flush concern while manufacturing MIST.This should help us differentiating from Coke and Pepsi since they have had troubles in the past regarding their quality. Media Influence Extensive promotion schemes across different media (using teasers, events and sack up portals) Advertisement frequency Brand endorsement Based on the above factors, our positioning of Mist vis-a-vis its main competitor (Mountain Dew) and other akin(predicate) lime and lemon flavoured drinks (Coca cola was also included as a reference) has been quantitatively depicted in the cobweb diagram below.Some of the attribute s are 1. Ingredients Mist is an augmented product over other citrus flavoured drinks, being packed with higher carbonation and caffeine. So, we rated this attribute above the other drinks. 2. Awareness As Mist is a new product to be launched, we cannot gauge its awareness. However, we denominate to bring it to the desired level based on our extensive promotional endeavour which will be explained in the Marketing Mix. As of now, awareness is being measured based on the current awareness level for Kingfisher. 3.Availability Unlike the extensive mass distribution and availability of the other drinks, we intend to have a selective distribution for Mist. 4. Refrigeration This is based on the amount of refrigeration required and the level of service give by the companies by providing refrigerators. As Mist is selectively available, we intend to provide refrigeration facilities at all points of sale. This refrigerators will be small and but for Mist. It will have eye-popping displ ays labelled with the title Mist and will be painted in its colours. MARKETING MIX PRODUCT running(a) Great taste Ity Quench Thirst Features Invigorating effect due to higher caffeine Tingling taste and flavor Appearanc Available in Stylised cans E PRICING Competitor based pricing The price of a can of Mountain Dew and other soft drinks is Rs. 20. We may learn to price it higher than this since we are not going in for mass marketing but rather selecting a specific target segment. Cost Based pricing Cost Based pricing is integral to establish the concluding point of a new products price range.By accurately analyzing cost per unit and taking into account a margin that corresponds to the lowest satisfactory return on investment, companies can define a new products floor price. If the market cannot support this price, then the company must reconsider if the product is feasible. If we take the major cost components as man ufacturing, advertising and distribution we can come to a rough estimate of the variable cost of Mist. This will not include the costs associated with machinery installation, R & D of the product and other associated capital expenses. This shall be collected through contribution per can. employ estimates for the major variable cost components we take i. Advertising Cost per can Rs. 8 10 ii.Manufacturing Cost per can Rs. 4-5 iii. Administrative Costs and other overheads per can Rs. 2-3 iv. Distribution Costs estimated to be Rs. 1 per level Therefore the total cost of producing one can comes out approximately to be Rs. 17-19. Value Based Pricing While some benefits have values that can be readily quantified, others such as brand personality and premium are more difficult to measure and must be probed using market research. Since we are positioning Mist as a premium brand it should be priced higher than its direct competitor (in this compositors case Mountain Dew) in order for the target group to it as a premium brand. Since a can of a cola costs Rs. 0 then we will price it at Rs. 24 (we are nerve-racking simultaneously to take advantage of bundles of five pricing and have the customers recognize it as a premium brand). As shown by the market research, customers are willing to pay more for a product like Mist. Moreover, considering the aspiration value of the product and the parent company, we have decided to follow value based pricing. PROMOTION According to the positioning of the Mist, a promotional campaign will be designed to create awareness and pull in the market. AIDA model will be followed for the promotional campaign. The steps taken in each stage will make consumers to Think, feel and do.