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1)
SITUATION ANALYSIS
MAKKANI group for the first time are entering the toiletries business. We are launching a shampoo by the name of DOCTOR DANDRUFF. Although we have no experience in toiletries, but good market reputation and vast experience in FMCG goods are plus points for our firm.
30% 25%
45%
NON-USERS
SHAMPOO USERS
SOAP USERS
MARKETING PLAN
TABLE-2: GENERAL STATISTICS OF SHAMPOO USERS
60%
Brief information about daily shampoo consumption in Pakistan is: Per day shampoo consumption by one person: 5 ml Total per day shampoo consumption: 225,000 liters Total per year shampoo consumption: 82.125 million liters
1.1.1
MARKET SHARE
There are varieties of shampoos available, but we have classified them into two categories: Anti-dandruff shampoos Other shampoos ANTI-DANDRUFF SHAMPOOS The statistics of anti-dandruff shampoos in Pakistan are:
TABLE-3: ANTI-DANDRUFF SHAMPOO USERS
ANTI-DANDRUFF SHAMPOO USERS People with dandruff problems Anti-dandruff shampoo users Male Female 72 million 18 million 10.44 million (58%) 7.56 million (42%)
Total per day consumption of anti-dandruff shampoos: 90,000 liters (18 million x 5 ml) Total per year consumption of anti-dandruff shampoos: 32.85 million liters
MARKETING PLAN
(90,000 liters x 365 days)
TABLE-4: MARKET SHARE OF ANTI-DANDRUFF SHAMPOO PRODUCERS
MARKET SHARE OF ANTI-DANDRUFF SHAMPOO PRODUCERS HEAD & SHOULDERS (P & G) 17.082 million liters (52%) SUNSILK-WHITE (UNILEVER) 11.826 million liters (36%) OTHERS 3.942 million liters (12%)
OTHER SHAMPOO USERS People with no dandruff problems Other shampoo users Male Female 108 million 27 million 8.91 million (33%) 18.09 million (67%)
Total per day consumption of other shampoos: 135,000 liters (27 million x 5 ml) Total per year consumption of other shampoos:49.275 million liters (135,000 liters x 365 days)
TABLE-6: MARKET SHARE OF OTHER SHAMPOO PRODUCERS
MARKET SHARE OF OTHER SHAMPOO PRODUCERS PROCTER & GAMBLE (P & G) 18.7245 million liters UNILEVER PAKISTAN 22.6665 million liters OTHERS 7.884 million liters
MARKETING PLAN
(38%)
CHART-4: PIE CHART OF OTHER SHAMPOO PRODUCERS
16% 46% 38%
(46%)
(16%)
P&G
UNILEVER
OTHERS
1.1.2
MARKET DEMOGRAPHICS
GEOGRAPHIC The shampoo users in Pakistan are divided into three territories: Cosmopolitan Areas o Karachi o Lahore o Islamabad Semi-Cosmopolitan Areas o Hyderabad o Faisalabad o Sialkot o Rawalpindi o Multan o Peshawar o Quetta Metropolitan Areas o Sukkur o Nawabshah o Larkana o Gujranwala o Gilgit o Gwadar o Other territories Statistics of consumption of shampoo and soap in above territories is appended below.
MARKETING PLAN
COSMOPOLITAN AREAS 30.30% CITY Karachi Lahore Islamabad SHAMPOO USERS % 54.17% 64.71% 63.16% SOAP USERS % 45.83% 35.29% 36.84%
SEMI-COSMOPOLITAN AREAS 27.78% CITY Hyderabad Faisalabad Sialkot Rawalpindi Multan Peshawar Quetta SHAMPOO USERS % 44.83% 46.15% 42.17% 43.37% 38.57% 36.17% 34.04% SOAP USERS % 55.17% 53.85% 57.83% 56.63% 61.43% 63.83% 65.96%
METROPOLITAN AREAS 41.92% CITY Sukkur Nawabshah Larkana Gujranwala Gilgit Gwadar Others SHAMPOO USERS % 45.12% 42.03% 45.05% 44.78% 39.13% 36.36% 34.17% SOAP USERS % 54.88% 57.97% 54.95% 55.22% 60.87% 63.64% 65.83%
MARKETING PLAN
DEMOGRAPHIC The shampoo users in Pakistan are both male and female of different age groups. Statistics are appended below:
TABLE-11 GENDER WISE STATISTICS OF SHAMPOO & SOAP USERS
TOTAL POPULATION 180 million GENDER Male Female TOTAL 86.40 million (48%) 93.60 million (52%)
SHAMPOO USERS 45 million 25% GENDER Male Female TOTAL 21.60 million (48%) 23.40 million (52%)
SOAP USERS 54 million 30% GENDER Male Female TOTAL 25.92 million (48%) 28.08 million (52%)
AGE GROUP Infants to 9 years 10 to 14 years 15 to 25 years 26 to 35 years 36 to 50 years Above 50 years
POPULATION 15.84 million (16%) 6.93 million (7%) 20.79 million (21%) 23.76 million (24%) 19.80 million (20%) 11.88 million (12%)
SHAMPOO USERS 1.25685 million (7.935%) 1.55925 million (22.50%) 11.8503 million (57%) 14.256 million (60%) 11.088 million (56%) 4.9896 million (42%)
SOAP USERS 14.58315 million (92.065%) 5.37075 million (77.50%) 8.9397 million (43%) 9.504 million (40%) 8.712 million (44%) 6.8904 million (58%)
AGE GROUP
SHAMPOO CONSUMPTION (million liters) 2.2938 (2.793%) 2.8456 (3.465%) 21.6268 (26.334%) 26.0172 (31.68%) 20.2356 (24.64%) 9.1060 (11.088%)
ANTI-DANDRUFF SHAMPOO CONSUMPTION (million liters) 0.3285 (1%) 0.9855 (3%) 8.541 (26%) 9.855 (30%) 9.198 (28%) 3.942 (12%)
OTHER SHAMPOOS CONSUMPTION (million liters) 1.9653 (4%) 1.8601 (3.77%) 13.0858 (26.56%) 16.1622 (32.80%) 11.0376 (22.40%) 5.164 (10.48%)
MARKETING PLAN
BEHAVIOR FACTORS Elite class is very quality conscious; hence the quality should be good otherwise they may turn to competitors. Majority of the people in the country are price conscious and they buy the products if it is economical. Absence of Halal ingredients may result in no sales. If people will recognize that product is of DANISH origin then they will quit buying it no matter how good is the product. A few of the people also buy products if it is suitable for their health. Hence if the product will be certified by a laboratory then it can increase sales.
1.1.3
MARKET NEEDS
Following are the major requirements needed in a product by customers in Pakistan. High quality. Economical prices. Easy availability. Halal goods. Products with maximum features. Toiletry goods better should be certified by any laboratory or doctor.
1.1.4
MARKET GROWTH
The market is growing every year by 4% in total. The people who are using soap are switching slowly toward shampoo at a rate of 1.2% per year. There are chances of growing more if people are made realized that anti-dandruff shampoo will not change the outlook of their hairs. There are good chances to increase market share of anti-dandruff shampoo if it will be sell as a medicated product.
MARKETING PLAN
Product should be updated regularly to survive and to achieve growth.
Budget is high. Company has a vast experience in FMCG goods. The group has a strong reputation in the market. Relationship with advertisement agencies is good. Product is the highly established and one of the top brands in Denmark. Higher management is experienced, trained and qualified. Product is different both for males and females. Available in pouch, which is offered by none of the shampoo companies. Product contains halal ingredients and is certified by laboratories in U.K and U.A.E.
1.2.2
WEAKNESS
High costs because of no production facility. Only a few distributors from companies presently appointed distributors have experience to market and distribute toiletry goods. The company itself has no experience in toiletry goods. Staff and lower levels are inexperienced. Product is not resistant to hair color. Warehouses in Balochistan and N.W.F.P are small. Warehouses in Interior Sindh & Punjab are not in a very good shape. Lack of creative people in marketing department.
1.2.3
OPPORTUNITIES 8
MARKETING PLAN
If there is one big player in the market and if anyone takes a small portion of their share then it does not affects them. Ground to convert people who use soap. Ground to convert people from using other shampoos by selling anti-dandruff shampoo as a medicated product. Chances to gain ground in semi-cosmopolitan and metropolitan areas as people have started changing their life styles.
1.2.4
THREATS
Political conditions of the country are not good and can affect the product. Inflation rate in country is alarming so purchasing power of people is reduced. Oil prices are going very high so cost of everything like, raw materials, labor wages, transportation costs etc are increasing. Currency rates in Pakistan are getting stronger and stronger which increases the cost and ultimately prices. People in semi-cosmopolitan and metropolitan areas use soaps a lot, especially metropolitan areas. People have a perception that usage of anti-dandruff shampoo will disturb the outlook of their hairs. Head & Shoulders (P & G) is the biggest competitor. Unilever is consistently launching new products in their existing brand SUNSILK. Retailers are hesitant to sell new products. Wholesalers are demanding high commission to distribute the product. If people will recognize that our product is of DANISH origin than they will quit buying the product. During the test marketing period there are chances that some other company might also launch the similar product.
MARKETING PLAN
Good quality. Economical prices. Special incentives from the company. Easy availability.
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MARKETING PLAN
2)
MARKETING STRATEGY
2.1 MISSION
To provide consumers in Pakistan with the right shampoo for their hairs in economical prices containing halal ingredients.
2.2 GOAL
To make our brand the best selling brand of the entire country in the next 10 years.
2.3 OBJECTIVES
To achieve at least 70% sales of Head & Shoulders in the 1st year of operations. To increase profit margin by 2% in 2nd year of operations. To gain at least 45% market share in the next 5 years. To make our products available at 75% of shops in semi-cosmopolitan and metropolitan areas of the country in the next 5 years. To make our products available at all shops in cosmopolitan areas of the country in the next 5 years. To start our own production facility after 3 years of operation. Maintain a significant research and development budget to spur future product developments. To launch other varieties in our product. To export finished goods to Denmark. Decrease the production costs by 5% in the 2nd year of operations. Decrease customer acquisition cost by 2.5% in the 2nd year of operation.
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MARKETING PLAN
TABLE-14: TARGET MARKET IN COSMOPOLITAN AREAS
Metropolitan Areas o Sukkur o Nawabshah o Larkana o Gujranwala o Gilgit o Gwadar o Other territories
TABLE-16: TARGET MARKET IN METROPOLITAN AREAS
2.5 POSITIONING
DOCTOR DANDRUFF will be positioned on the basis of high quality and its distinctive feature i.e. separate product formula for both males and females. The brand is the top most selling brand of Denmark and the vast experience of higher management will help to promote it in Pakistan.
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MARKETING PLAN
2.6
MARKETING MIX
PRODUCTS
2.6.1
The name of our product is DOCTOR DANDRUFF. It is the top most selling brand of Denmark. The product has started gaining ground in other European countries like Norway, Sweden, Netherlands, Ireland, Iceland and Switzerland. The product is available with features like anti-dandruff and hair conditioner. The product contains all halal ingredients. The most distinctive feature of our product is its formula. We are producing different product for both males and females under a single brand name. Research has shown that there are different reasons for dandruff in males and females. The product will be available in below stock keeping units (SKU). o o o o o 5 ml Sachet 100 ml Pet bottle 100 ml Pouch bottle 250 ml Pet bottle 500 ml Pet bottle
2.6.2
PRICE
The product will be charged in Pak Rupees. The price of below proportions will be different from the prices of Head & Shoulders. o 250 ml Pet bottle o 500 ml Pet bottle The company will try to reduce the prices of their products next year by 2% to 5%. Special promotional prices will be announced three times in 1st year in the months of Rabi-ul-Awwal, Ramazan/Eid-ul-Fitr, and Eid-ul-Azha. Different pricing and payment policies will be adopted for retailers and wholesalers. A maximum discount of 20% will be offered.
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PRODUCER
WHOLESALERS
END-USERS
SHOPS
END-USERS
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MARKETING PLAN
Cosmopolitan Areas Lahore
PRODUCER
WHOLESALERS
END-USERS
SHOPS
PRODUCER
WHOLESALERS
SHOPS
END-USERS
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MARKETING PLAN
Semi-Cosmopolitan Areas
PRODUCER
WHOLESALERS
SHOPS
END-USERS
Metropolitan Areas
PRODUCER
WHOLESALERS
SHOPS
END-USERS
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MARKETING PLAN
STRATEGIES FOR PRODUCTS PLACEMENT Products will be places at following 4 points in retail stores. o o o o Cosmetics Toiletries Food Items Electronic Goods
In toiletries section of retail stores the products will be placed at start and end. In other sections of retail stores the products will be placed in center. In retail stores the product will be placed in company made holders. Product will be kept in front in shops and small retail stores. Hanging cards, Panaflexes and Posters will be placed in retail shops and shops. Transportation mode will be vans, shehzores and air planes. Company will have warehouses in Karachi, Lahore, Islamabad, Faisalabad, Quetta & Peshawar. For access to centrally located cities and interiors in Sindh there will be a warehouse in Sukkur. For access to centrally located cities and interiors in Punjab there will be a warehouse in Sialkot.
2.6.4
PROMOTION
The media for advertisement will be electronic, print and billboards. The ad will run of all the channels 25 times a day. The ad will be updated after every 1 month. The peak time for advertisement will be during talk shows and reality shows. The product will be sold as a medicated product, recommended by the doctors. Heavy advertising campaign will be done during Olympic games and ICC Champions trophy.
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MARKETING PLAN
All the magazines will carry the ad for 3 months, and after 3 months 25 fashion magazines and other top 25 magazines will carry the ad for the rest of 9 months. After 1 year the ads will be placed in top 10 fashion magazines and other top 15 magazines. All the English newspapers, JUNG newspaper and EXPRESS newspaper will carry ads for 3 months, and after 3 months top 5 English newspapers, JUNG newspaper and EXPRESS newspaper will carry the ads. The ad will run in URDU language and provincial language of respective province. One ad agency will be appointed for advertisement matters. The company will also take part in exhibitions. Test marketing will be done by distributing products allover the country in college, universities, and retail stores by company appointed persons. A survey will be conducted from 500 persons after 1 year to get the feedback about the product. Company will offer sales promotion materials three times in 1st year of operations. A special bumper prize will be offered by company for 4 persons (2 persons after every 6 moths) to visit production facilities in U.K.
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MARKETING PLAN
3)
FINANCIALS
3.1
3.1.1
S# 1 2 3 4 5 6 7 8 9
DESCRIPTION Import Price per liter Import Expenses per liter Finishing Expenses per liter Factory Expenses per liter Distribution Expenses per liter Marketing Expenses per liter Office Expenses per liter Miscellaneous Expenses per liter Commission Expenses
3.1.2
TOTAL COSTS
12 million liters PKR 480,000,000 PKR 120,000,000 PKR 600,000,000
Import Price (12 million liters x Rs. 40) Import Expenses (12 million liters x Rs. 10) Total Import Cost per year Add: Expenses Finishing Expenses (12 million liters x Rs. 30) PKR 360,000,000 Factory Expenses (12 million liters x Rs. 20) PKR 240,000,000 Total Expenses per year TOTAL COST OF GOODS PER YEAR
3.1.3
Distribution Expense (12 million liters x Rs. 30) Marketing Expenses (12 million liters x Rs. 150) Office Expenses (12 million liters x Rs. 100) Miscellaneous Expenses (12 million liters x Rs. 50) Total Expenses per month
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MARKETING PLAN
TABLE-18: COMMISSION EXPENSES
SIZES
SALES AMOUNT (PAK RUPEES) 2,869,776,000 2,032,758,000 813,103,200 1,040,293,800 693,529,200 7,449,460,200
YEARLY COMMISSION AMOUNT (PAK RUPEES) 573,955,200 406,551,600 162,620,640 208,058,760 138,705,840 1,489,892,040
5 ml Sachet 100 ml Pet Bottle 100 ml Pouch Bottle 250 ml Pet Bottle 500 ml Pet Bottle
3 68 68 145 290
PKR 5,449,892,040
SIZES 5 ml Sachet 100 ml Pet Bottle 100 ml Pouch Bottle 250 ml Pet Bottle 500 ml Pet Bottle
EXPENSES PER UNIT (PAK RUPEES) 2.25 46.60 46.60 112.50 224
SIZES 5 ml Sachet 50 ml Pet Bottle 100 ml Pet Bottle 100 ml Pouch Bottle 150 ml Pet Bottle 200 ml Pet Bottle 250 ml Pet Bottle 500 ml Pet Bottle
HEAD & SHOULDERS PKR PKR PKR PKR PKR PKR PKR 100 125 150 295 3 36 68
SUNSILK-WHITE PKR PKR PKR PKR PKR PKR PKR 100 120 150 300 3 35 70
OTHERS AVERAGE PRICES PKR PKR PKR PKR PKR PKR PKR 98 118 144 290 3 32 65
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MARKETING PLAN
SIZES
HEAD & SHOULDERS (SALES IN MILLION LITERS) 4.2705 2.5623 3.07476 1.7082 2.39148 1.7082 1.36656 17.082
HEAD & SHOULDERS (SALES IN QUANTITY) 854,100,000 51,246,000 30,747,600 11,388,000 11,957,400 6,832,800 2,733,120 969,004,920
DOCTOR DANDRUFF (SALES IN MILLION LITERS) 4.78296 2.98935 1.19574 1.79361 1.19574 11.9574
DOCTOR DANDRUFF (SALES IN QUANTITY) 956,592,000 29,893,500 11,957,400 7,174,440 2,391,480 1,008,008,820
5 ml Sachet 50 ml Pet Bottle 100 ml Pet Bottle 100 ml Pouch Bottle 150 ml Pet Bottle 200 ml Pet Bottle 250 ml Pet Bottle 500 ml Pet Bottle
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MARKETING PLAN
TABLE-22: SALES COMPARISON AMOUNT WISE
DOCTOR DANDRUFF SIZES 5 ml Sachet 50 ml Pet Bottle 100 ml Pet Bottle 100 ml Pouch Bottle 150 ml Pet Bottle 200 ml Pet Bottle 250 ml Pet Bottle 500 ml Pet Bottle SALES QUANTITY 956,592,000 29,893,500 11,957,400 7,174,440 2,391,480 1,008,008,820 PRICE (PAK RUPEES) 3 68 68 145 290 TOTAL AMOUNT (PAK RUPEES) 2,869,776,000 2,032,758,000 813,103,200 1,040,293,800 693,529,200 7,449,460,200 SALES QUANTITY 854,100,000 51,246,000 30,747,600 11,388,000 11,957,400 6,832,800 2,733,120 969,004,920
HEAD & SHOULDERS PRICE (PAK RUPEES) 3 36 68 100 125 150 295 TOTAL AMOUNT (PAK RUPEES) 2,562,300,000 1,844,856,000 2,090,836,800 1,138,800,000 1,494,675,000 1,024,920,000 806,270,400 10,962,658,200
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