Raageshwari Eileen Palmer

517826 - Group 8
OPL Individual Plan

Tutor: Mrs. Meijer Merel

Table of Contents
1. EXECUTIVE SUMMARY ...................................................................................... 3
2. SITUATION ANALYSIS ....................................................................................... 4
2.1 CURRENT MARKETING SITUATION ............................................................................................. 4
2.2 CURRENT MARKETING MIX ...................................................................................................... 5
3. INTERNAL ENVIRONMENT ............................................................................... 6
3.1 MISSION & VISION .................................................................................................................... 6
3.2 ORGANIZATIONAL STRUCTURE .................................................................................................. 7
3.3 CORPORATE CULTURE ............................................................................................................... 7
3.4 PRODUCT DESCRIPTION ............................................................................................................. 8
3.5 PREVIOUS SALES ...................................................................................................................... 9
3.6 MARKETS .............................................................................................................................. 10
3.7 DISTRIBUTION ........................................................................................................................ 10
4. EXTERNAL ENVIRONMENT .............................................................................. 11
4.1 DESTEP ............................................................................................................................... 11
4.2 MARKET ANALYSIS ............................................................................................................... 15
4.3 CONSUMER ANALYSIS ............................................................................................................ 17
4.4 COMPETITIVE ENVIRONMENT ................................................................................................. 18
5. SWOT ANALYSIS ............................................................................................... 22
5.1 STRENGTHS ............................................................................................................................. 22
5.2 WEAKNESSES ........................................................................................................................ 22
5.3 OPPORTUNITIES ..................................................................................................................... 23
5.4 THREATS ............................................................................................................................... 23
6. MARKETING OBJECTIVES ............................................................................... 24
7. MARKETING STRATEGIES ............................................................................... 24
7.1 TARGET MARKETS ................................................................................................................. 25
7.2 BRANDING ............................................................................................................................. 25
7.3 PRODUCT POSITIONING ........................................................................................................... 30
7.4 PRODUCT STRATEGIES ........................................................................................................... 31
7.5 PRICING STRATEGIES ............................................................................................................. 33
7.6 PROMOTION STRATEGIES ........................................................................................................ 34
7.7 SUPPLY CHAIN STRATEGIES ................................................................................................... 37
8. IMPLEMENTATION .......................................................................................... 39
8.1 SALES FORECAST ................................................................................................................... 39
8.2 ACTION PLAN ........................................................................................................................ 41
8.3 BUDGET ................................................................................................................................. 43
9. MEASUREMENT AND CONTROL STRATEGIES ................................................. 43
9.1 RESEARCH ............................................................................................................................. 43
9.2 TREND ANALYSIS .................................................................................................................. 43
10. BIBLIOGRAPHY ................................................................................................ 44

1. Executive Summary

This reports was commissioned to examine a company, which was originated from
Belgium, called Dendermonde. Dendermonde produces several sorts of dairy desserts based on
natural ingredients. Dendermonde can be loosely described as a small-scale dairy dessert
producer that never took any risk or chance to develop to its full market potential.
Dendermonde had experienced severe internal problems and was on the verge of bankruptcy.
Fortunately, our consultancy firm has been hired to analyze the company and provide
Dendermonde with new objectives, implementation plans, and strategic approaches in order to
help the company recover from its downturn.

The result from Dendermondes company analysis draws attention to the fact that their
market share in 2012 was 2%, a number far less than its competitors. The shares of their
competitors such as Friesland Campina and Danone were 16.6% and 8.4% respectively. Further
investigations revealed that this market shrinkage coincided due to insufficient investments to
be made in the company and new demands in the dairy market not being met by Dendermonde.
Due to the uprising demand for low fat and organic products in the dairy market, these product
types has showed to influence choices for most of dairy purchases. These factors appear to be
the major causes for Dendermondes low product sales and small market shares.
Our consultancy firm, Consult4u, have arranged the market penetration strategy by Ansoff
to be used in guiding Dendermonde to regain its health and profitability. Dendermonde will
improve existing products and introduce it to its existing markets, which are mainly
supermarkets. Dendermonde will also re-launch the organic range of dairy dessert and add low
fat choices to their products. Dendermonde will continue the use of private label brands because
according to market research, private label brands are experiencing
rapid growth of sales due to the increasing consumer needs for
affordable goods. The report evaluates this decision and concludes that
it would be an ideal candidate to meet the challenge presented by the
market and could satisfy the new consumer demand.
It is recommended:

Dendermonde take immediate measures to launch and promote the new organic dairy
desserts alongside its existing product range.

Dendermonde focuses in supplying private label brands to leading Supermarkets/
Hypermarkets.

Dendermonde expands their product lines by including low fat choices for the dairy
desserts.

1. Situation Analysis
1.1 Current Marketing Situation
The Dendermonde Company was founded in 1949 in Belgium with the goal of creating

the tastiest dairy desserts using ancient farmer traditions and secret homemade recipes based
on natural ingredients. The company has expertise due to years of experience to create and

market products that will appeal in the dairy market. The key reasons that Dendermonde did
not reach its full market potential is as follows:

The lack of motivation and no clear strategies for enacting growth and value creation. The
company has not set clear marketing objectives, marketing mix, and does not have a
clearly defined target group. The CEO of Dendermonde also claims that he lacks the time
to analyze the external environment, therefore any market trends will not be recognized
by the company.

Due to a vacant managerial position, Dendermonde does not have a functional marketing
department. Mr. De Clercq, who is also the CEO of Dendermonde, is currently taking care
of all marketing activities happening in the company. Three people are responsible for
sales within Belgium and all other export activities, these two employees deal with no
actual marketing concerns, causing the marketing department to be inoperative. Massive
changes in the company need to be made because of the unorganized internal situation.

The Belgian market mainly knows Dendermonde dairy desserts under the private label
brand Pur Natur used for a Belgian supermarket chain. Dendermondes own labels are
poorly designed with no clear pictures available, which is the reason why the Pur Natur
brand excels over its own brand. The production of organic desserts, which were in high
demand in 2009, was halted due to production problems. This problem caused the loss of
a key customer, the Intermarche supermarket.

The company also shows some export potentials but no clear internal export strategy has
been set therefore causing only 5.5% of the companys products to be exported in 2012.
The contacts made for export activities also does not last long due to no customer
relationship efforts to be made by the marketing and sales department.

In conclusion to the current situation, Dendermonde has to rebuild its marketing

department in order for it to regain profit. A new marketing manager should be appointed to
manage the department. Moreover, customer relationship polices are needed in order to
retain customers and an effective marketing mix to be defined in order to expand the

products

to

its

full

market

potential.

2.2 Current Marketing Mix

PRODUCT
The focus of Dendermonde is mainly on dairy desserts production. In Dendermondes
production hall, most of the products produced for supermarkets are private labels. The
products that are being produced are different types of flavored yogurts and quarks.
Dendermonde had the chance to produce organic desserts for a Belgian supermarket called
Intermarche, but due to production problems, the organic desserts production were halted. The
most popular flavors for Dendermondes desserts are strawberry, apricot, yellow fruit, and
vanilla. The fruit fillings in the desserts can easily be changed therefore customers can choose
flavors that comply with their specifications.

PLACE
Dendermondes products are currently sold through supermarkets in Belgium such as
Prima, Spar, Spegelaere, Cora, Champion, and Delhaize. Moreover, the company distributes their
products through several independent retailers such as Draailing and Hoev. The company also
managed to distribute through international customers thus exporting their products.
Intermarche supermarkets used to be one of Dendermondes distribution channels until 2009
when productions of organic desserts were halted.

PRICE
The company has generated no clear pricing strategy.Dendermondesproducts are classed as
lower to middlesegment of dairy dessert products therefore the prices are generally lower than
competitors to attract consumers.

PROMOTION
Dendermonde has not attempted to promote their products to attract more customers; they
have not created any promotional campaigns or activities to increase their low brand awareness.
The limited effort in promotions is also shown through their poor product packaging, no clear
pictures or labels has been used to attract customers to buy their products.

3. Internal Environment
3.1 Mission& Vision

Mission
We have chosen to developDendermondes strategic decisions and actions based
on the product-driven mission statement originally created by Dendermonde:
To develop, produce, and market a broad range of reliable, natural, and nutritous
dairy desserts that contributes to the well-being and vitality of life of customers and
to gurantee that all products are delivered to customers as soon as possible.

Vision
Dendermondes vision is the framework for the companys Roadmap and guides
every aspect of its business by describing what the company needs to accomplish
in order to achieve an operational, sustainable and quality growth. Therefore our
consultancy group recommends Dendermonde to:
1) Be a highlyeffective, accurate, and fast-moving organization.
2) Nurture a network of customers and suppliers to create a mutual and enduring value.
3) Be a great company where people are inspired to be the best they can be.
4) Bring to the world a portfolio of quality dairy dessertsthat anticipate and satisfy people's
desires and needs.
5) Be a responsible company that values sustainability.

3.2

Organizational Structure

As a supplier of dairy dessert products, Dendermonde does not have a very effective
organizational structure. Key personnel include the following:

Mr. De Clercq - CEO of Dendermonde: He is responsible for all marketing activities since
there is a vacancy managerial. He responds to complaints from customers, unsolicited
inquiries from other countries, and arranges the regular improvised communication
campaigns. He lacks the time to review the external environment and has no knowledge
of marketing activities that can be conducted to improve sales.

Mr. Jerom - Sales representative: Mr. Jerom is responsible for all sales in Flanders.

Mr. Vander Steen, Sales representative: Mr. Vander Steen takes care of sales in Wallonia
and the export activities.

Sales Assistant: Supports Mr. Jerom and Mr. Vander Steens in their activities.

3.3

Corporate Culture

Currently, Dendermonde does not have a corporate culture. The result is an

unstructured and uncontrolled organization. Improvements need to be made in order to
regain health and profitability of the company. A corporate strategy of abiding by the
adhocracy culture will be chosen for Dendermonde.
Dendermonde is a supplier of dairy desserts. Thus, a key element of the internal
environment is a culture that encourages the importance of flexibility and innovation. An
adhocracy culture will be suitable for Dendermonde, which means a business environment
adjusted to adaptability and quick reactions to the changing market, competition, and
external environment. An adhocracy culture is an integral component of corporate strategy
in this type of business.
The emphasis for this kind of corporate culture is on growth opportunities;
furthermore employees are encouraged to experiment with new ideas. The fast-moving
adhocracy culture values and embraces a leadership that demonstrates entrepreneurial and
risk-taking abilities.

3.4 ProductDescription
Dendermonde produces 7 types of dairy desserts. They produce natural yoghurts, fruit
yoghurts and different types of quarks containing only natural ingredients. All the ingredients for
the products are acquired from local suppliers. Due to the freshness of the natural ingredients, the
product has to remain refrigerated during shipment and storage periodsbecause dairy products
can spoil quickly if it is not properly stored.The shelf life of fresh and natural dairy dessert
products does not last too long.
Types of Yogurt & Quarks

Refrigerator

Freezer

Natural
Low Fat
With Fruit Fillings
Drinkable (Yogurt)

2-3 Weeks
1-2 Weeks
7-10 Days
7-10 Days

1-2 Months
1-2 Months
1-2 Months
1-2 Months

(EatByDate, 2012)

At present, the Dendermondes product line comes in 7 types of packaging. The product line
is currently Dendermondes only core product, though it is also used under a different privatelabel brand name in some Belgian supermarkets. The present products come in several different
flavors. The most favorable flavors are strawberry, apricot, yellow fruit, and vanilla.
As a producer of dairy desserts, Dendermonde holds the International Food Standards (IFS)
certificate for its company. The certification ensures:
- Common standard with uniform evaluation systems.
- Comparability and transparency throughout the entire supply.
- Reduction of costs and time for both suppliers and retailers.
The IFS certification allows Dendermonde as a supplier to be trusted by retailers. The
certification reassures current customers and potential customers to trust Dendermondes
quality. Dendermonde should hold this trust responsible by maintaining high quality and great
natural taste of its products.
Prices of Dendermondes current products:

From the table above, the Suggested Retail Price is the price that is suggested by
Dendermonde for its retailers. The Price to Distributor is the original price which Dendermonde
decided for its retailer. This means that Dendermonde receives revenue from the Price to
9

Distributor. (E.g. Dendermonde receives a 1.34 revenue for every purchase of the 500g yogurt
drink.)
At present, Dendermonde produces and manufactures its own dairy desserts. Dendermonde
should oversee the entire production process to ensure consistent quality of its unique product.
With this method of production, we can assume that the average variable costs for each product is
0.70. The annual fixed costs for supplies, management salaries, and professional services will be
as follows:
Employee Salaries

1, 545,600
441,068

Equipment and supplies

32,000

Expenses related to sales

(E.g. travel, etc.)
Advertising and other marketing
communications
Total Fixed Costs

50,782
2,069,450

Assuming all sales of the products are approximately equal, there is an average contribution
margin of 0.30 per product. Based on this, to achieve break even this year, Dendermonde must
sell:
2,069,450
=
6,898,166units
0.30
Again, assuming equal sales of all products, the break-even point in Euros is 6,553,258.

3.5

Previous Sales

Sales of Dendermondes products have not grown extensively. In fact, some sales have also
decreased since 2009 in some key accounts such as Champion and Spar. Actual figure for 2012 are
shown in the table below:
Dendermonde Sales Performance
Customers

Turnover
(2012)

Turnover
changes
(2009-12)
0.0%

Prima

200,000

Spar

1,800,000

-0.3%

Spegelaere

400,000

-2.1%

Cora

1,000,000

2.0%

Champion

2,800,000

-4.0%

Delhaize

560,000

2.0%

Intermarche

350,000

1.0%

Independent
Retailers
Exports

3,200,000

6.8%

350,000

Total

10,660,000

10

3.6 Markets
The consumer market for Dendermondes products is made up of anyone that is
interested in an affordable, healthy, and sustainable lifestyle. About 70% of Belgian
consumers say they are interested in living a healthy lifestyle;although the number of those
who actually work to achieve that goal is much smaller. Because of the trend towards a
healthier living grows both globally and domestically, sales for Dendermondes organic and
low fat are expected to expand and grow for some time.
Within the Belgium consumer market, Dendermonde targets middle class consumers
who believe in a healthy lifestyle. While these consumers are typically adults, there are also
a younger segment that seeks to be physically fit and that also patronizes sustainability.

3.7 Distribution
Dendermonde currently distributes to supermarkets, independent retailers, and some
export customers. In order to reach its target market, Dendermonde will place a
distribution emphasis on large-scale supermarkets. The company began developing
channel relationships with these retailers through individual contacts by company
personnels.
The company handles large key accounts such as Spar and Champion supermarkets
directly. While total sales to these chains are fairly substantial, when considering the
numerous branches each supermarket has, the sales are very small with much room for
growth.

11

4. External Environment
4.1

DESTEP
An analysis of Dendermondes home country, Belgium, will give an insight in
identifying Dendermondes opportunities and
threat. The external analysis of the
environment will also facilitate us in clarifying
and
generating
strategies
in
which
Dendermonde must use to fulfill their
objectives.

Demographics
Belgium is an advanced state in the European
Union with an estimated population of
10,444,268 people and a small population
growth rate of 0.061%. The birth rate in
Belgium is 11.7-births/1,000 populations and
a death rate of 9.2-deaths/1,000 populations.
The table shown below provides a
distribution of the Belgium population
according to their age groups and gender. The
dominating age groups arepeople that are 2554 years old making 40.6% of the total
population. The average age of the population is
42.6 years.
(Maps 2013)

Age Structure
0-14 years
15-24 years
25-54 years
55-64 years
65 years and over

Percentage (%)
15.7
11.8
40.6
13.2
18.7

Male
835,569
629,753
2,145,075
681,946
819,684

(CIAFactbook, 2013)

The most populated city in Belgium is Brussels with

1,019,022 people, followed by Antwerp with 459,805
people. The urban population in Belgium is reported as
97.40 % of the total population, with an annual growth of
0.8 %. This makes the remaining 2.60 % to be living in
rural areas.

Female
801,959
603,550
2,100,014
695,188
1,131,520
Areas

Population

Brussels
Antwerp
Gent
Charleroi
Brugge
Namur
Leuven
Mons

1,138,854
502,604
231,493
200,132
116,709
106,284
92,892
91,277

12

Since Dendermondes products are all dairy-based, the company will have to obtain a
large target group because typically all age, gender,or income groups can enjoy dairy-based
products.Although almost everyone can enjoy Dendermondes products, the products are not
targeted tosuit specificinfant requirements; therefore the target group will range from 5 65
years and over.
Economical Environment
Belgium has a GDP of 382.05 Billion, together with a purchasing power parity of
311.8billion, plus it has a GDP ranking of 18th among the 43 European countries. Its current
benchmark interest rate is 0.50%. Due to the global financial crisis, the economy of Belgium is
not looking so promising, but it can be seen to slowly recover, causing the GDP growth rate of 0.2
% and an inflation rate of -0.07 %.
Belgium is surviving the crisis quite
well, notably with a relatively good
unemployment performance of 8.1 %.
However, domestic demands in the
country are still weak.(BelgiumStatistics,
2013)

Belgium is among the most highly

industrialized countries in Europe. The
country mainly imports raw materials
in great quantity and processes them largely for export. Exports equal around two thirds of the
GDP, and about three-quarters of Belgium's foreign trade is within the European Union
countries.
Sociocultural Environment
In Belgium, the average household net-adjusted disposable income is 19,925 thousand a
year. But there is a considerable gap between the richest and poorest where the top 20% of the
population earns almost four times as much as the bottom 20%. The average net adjusted
disposable income of the top 20% of the population is an estimated 34,876 a year, whereas the
bottom 20% live on an estimated 8,952 a year. The household final consumption expenditures
are approximately 256.1 Billion, with 13.5 % of it going to food and drinks
expenditures.(BelgianFederalGovernment, 2013)

13

The Belgium population is a major dairy consumer therefore dairy plays a big role in
Belgians lives; they typically have milk for breakfast and fruit yogurts or quarks for snacks and
desserts. Health and wellbeing is also valued deeply amongst the Belgian population. Health and
wellness is shifting from being aniche to becoming a mainstream product segment. Belgian
consumers increasingly expect their local supermarkets/hypermarkets to offer ranges of organic
and natural products. Retailers have
responded to the growing demand by
launching a widening range of private label
products specifying in these areas.
Widening distribution and growing-health
awareness
amongst
the
Belgian
populationwill support strong growth of
products labeled as organic and natural.
Technological Environment
Belgium is a well-developed and
technologically advanced country with relatively modern living standards.The country has highly
developed transportation networks and high-tech information and communication technologies
(ICT), this is very beneficial due to the modernized way of transactions in the business world.
People, businesses and public authorities in Belgium are relatively quick in adopting new
technologies. In the case of technological innovations in the manufacturing sectors, enterprises in
Belgium show a good performance. The technical innovation rate for enterprises in Belgium ranks
as one of the highest, with 48.2%.
Ecological Environment
The Belgian population is well known for their sustainability towards the ecological
environment. Their sustainability is shown through their purchases of organic products. In 2013
the total supermarket organic sales increased to their highest level in 9 months, indicating
Belgian consumers choosing to buy
organic products as a guarantee of
integrity. February sales increased 8.4%
versus January. Some independent
organic products suppliers have also
reported an increase in sales of up to
20% over the past month.Belgians
concern for the environment is also
shown through their behavior of
purchasing domestic products. By
purchasing
products
that
is
manufactured locally, less carbon
footprints will be emitted. Dendermonde
only buys from local suppliers; therefore Dendermonde has an advantage of showing
sustainability in the environmental friendly Belgian dairy market.

14

Political and Legal Environment

All companies, associations, institutions or establishments that originates in Belgium are
liable to pay for a corporate income tax. The corporate tax rate for Belgium in 2013 is shown in the
table below.Belgium also have a moderately high standard rate of Value Added Tax (VAT) of 21%,
this is the additional amount buyers has to pay when purchasing Dendermondes products

Band of taxable profit

Rate applicable to band

0 25,000

24.98 %

25,001 90,000

31.93 %

90,001 322,500

35.54 %

(WIPFLITax, 2013)

Since the milk quota regime was introduced, milk quota has become a scarce production
factor: on the one hand limiting milk production and, on the other hand, stabilising milk
producer prices and maintaining dairy activities in less competitive regions. An abolishment of
milk quotas is forecasted for 2015, but it is thought to increase milk supplies leading to a further
10% decline of milk prices.
During the milk quota establishment, dairy farmers have declined by 72% and dairy herd
decreased by40-45% in the EU. The EU milk quota system was originally introduced in 1984, in
order to limit public expenditure on the sector, to control milk production, and to stabilize milk
prices and the agricultural income of milk producers. (ConfederationFiscaleEuropeenne 2013)
In conclusion, the EU has its own ''protected'' market,
there is a huge subsidized overproduction of milk, quota's
have already been set for years, farmers who produce too
much milk get fined, so the farmers over producing milk has
to ditch their milk. The EU ditches the overproduction
because quota's are still way too high. Therefore, exporting neighbouring countries would just be
the same as any other country within the EU, and outside the EU the export costs would be too
high. This can also be seen as an opportunity to grow domestically within Belgium.

15

4.2 Market Analysis

A thorough understanding of the dairy market is crucial for increasing the sales of
Dendermondes products. Fortunately, the dairy market is leading towards a more prosper
year in 2013 for Dendermondes kind of products.
Milk Market
The Belgian milk market has a total revenue of 4.6 billion in 2013, representing an annual
growth rate of 2.2%.Market consumption volumes increased with a growth rate of 0.8%. Due to
milk quotas, milk deliveries have decreased 0.9% compared to 2012.In the first months of
2013, the EU milk collection has been strongly
affected by the climatic conditions and the high
compound feed prices, leading to expectations that
the milk production will not increase and remain
constrained in 2013.
Although the value of the market has increased, the
potential threat in the market is the high and rising
milk prices due to limited supplies of milk. The high milk prices might affect production prices
of Dendermondes products but fortunately the demand for dairy products still remain
strong.(EuropaAgricultureMarket, 2013)
Yogurt Market
Total yogurt expenditures in 2013 have increased by 4.9 % to 1.6 billion compared to
November 2012. The average price per kg of yogurts has also increased by 7.6 % year-on-year to
2.81/ kg. This major incline in the yogurt sectors can open up more opportunities for
Dendermonde to increase sales.
The total yogurt market consists of Private Label and Branded products. Branded yogurts
make up about 70 % of total yogurt volumes sold. This year however, Branded products saw
volumes decline 7.1 % compared to 2012.Increasing purchases of private label yogurts is
thought to be the cause of the decline. The private label purchases have increased by a
tremendous 10.5 %. Therefore a definite increase invalue and sales are forecasted in 2013 for
Dendermondes private label yogurts.
16

Total yogurt market in Europe, 2013

Total yogurt

Year-on-year
(%)

Private
Label

Year-on-year
(%)

Branded

Year-on-year
(%)

Value
(000s)

1,362,066

+4.9

303,093

+15.0

1,058,973

+2.3

Volume
(000kg)

574,720

-2.6

167,915

+10.5

406,805

-7.1

Average
Price (/kg)

2.37

+7.6

1.81

+4.0

2.60

+10.1

(DairyOrg 2013)

As for types of yogurt, natural yogurt has seen the largest volume growth over the year with
a staggering 16.8 %. Low fat yogurt has also seen large growths with volumes up 8.1 %. The
choices of yogurts are mostly influenced by yogurts that are labeled as Low Fat and All Natural.
The largest declines for yogurt types by far are the children yogurts, sales volumes decreased by
15.5 %. As for price levels, Low fat yogurts are the cheapest with 1.78/kg, while childrens
yogurt remained to be the highest with 3.18/kg. Yogurt drinks have also grown 4% from 2012,
with over 1 in 3 households purchasing yogurt drinks over the year.
Total yogurt market by product type in Europe, 2013

Product type

Spend
(000s)

Year-on-year
(%)

Volume
(000Kg)

Year-on-year
(%)

Average Price
(/kg)

Year-on-year
(%)

Organic / Bio
set

414,333

-0.1

156,747

-6.3

2.64

+6.7

Childrens
Yogurt

30,111

-4.2

9,454

-15.5

3.18

+13.4

Low Fat

2.37

+7.6

92,266

+8.1

1.78

+3.2

Natural

99,916

+21.0

53,919

+16.8

1.85

+3.6

Very Low Fat

298,042

+9.1

125,435

-3.3

2.38

+12.9

(DairyOrg 2013)

17

Quark Market
Quark has the potential to be the next on-trend, high-protein indulging health food. Global
sales of quark reached0.3 billion in 2012, up by 20% in current terms from 2007. Major players
in the dairy industry have been introducing quarks to consumers, the consumers responded
positively towards the high-protein dessert. Consumers now perceive quarks a normal dairy
dessert that is highly enjoyed just like yogurt. (EuroMonitorInternational 2011)
Belgian consumers love Quark. Belgians describe the dessert as a mild creamy product
without the sour taste of yogurt. Health conscious consumers keep on eating Quark due to the
low fat content and high protein. The nutritional content of Quark is hard to surpass, only a few
products offer such high protein content and versatility as Quark.

4.3 Consumer Analysis

As our target market consist of age groups from 5 65 years old, we have clustered them into
different groups to analyze and identify Dendermondes customers:
1. Young Adults
Characteristics:

Enjoys social and physical activities

Shops in supermarkets and convenience stores

Self-conscious and spends moderate amount of

money on physical appearance.

Up to date with latest trends in technologies.

Point of recognition:

Attends higher education level

Have part-time or full-time jobs

Broad range of friends

Aged between 16 29 years old

2. Adults
Characteristics:
Enjoys social activities such as going to bars,
restaurant, or staying in with friends for a
homemade meal

Shops their groceries in supermarkets or

hypermarkets

Have stable families and saving

Conservative and price sensitive

18

Point of recognition:

Solid social relationships

Medium income range

Lives in suburban areas

Aged between 30 55 years old

3. Elderly:
Characteristics:

Health conscious

Enjoys eating healthy meals and doing mild

physical activities, e.g. jogging.

Shops in farmers markets and

supermarkets

Spends allowances conservatively

Price sensitive
Point of recognition:

Retired

Solid social relationship

Family orientated

Active in physical and social activities

Aged between 56 65 years old

4. Children:

Characteristics:

High brand loyalty

Enjoys colorful packaging

Surrounded by families and enjoys social

activities

Dependent on families
Point of recognition:

Low education level

Family orientated

Depends on parents for purchasing decisions, no income.

Aged between 5-15 years old

19

4.4

Competitive Environment

The dairy market is known for its competitiveness. In order for Dendermonde to survive, the
company must analyze its competitors positions in the marketplace. To develop an effective
positioning strategy to influence the target groups perceptions of Dendermondes products,
Dendermonde must understand the current situation in the same market by comparing itself to
its competition. Branded dairy desserts are Dendermondes main threat because Dendermonde
produces mostly for private labels. It is very important to distinct a competitive advantage
between branded and private label products.
Dendermondes direct competitors are companies that also market dairy dessert type products,
including the following:
FrieslandCampina
FrieslandCampina is a leading player in the Belgian dairy market. They account for 16.6 %
market share in the dairy desserts industry. The company claimed to have a revenue of 10.3
billion euros in 2012 and as many as 1 billion consumers worldwide. Their profit increased by
26.9% from 2011 to 2012, making it 274 million Euros. The company values high quality
products, sustainability, and transparency standards throughout the whole chain. They develop
their dairy products based on essential nutrients needed by
consumers, hence ensuring to meet customer needs.
FrieslandCampina produces a diverse range of dairy desserts. Some
of their core products in Belgium include: Campina, ViFit, and
Fristi.

Campina FreshYo:

Campina FreshYo by FrieslandCampina is a fruit flavored yogurt

drink that was popularized in Belgium. FrieslandCampina priced their
yogurt drinks at 2.71 per liter. The product comes in 4 flavors;
strawberry, tropical fruits, banana and kiwi, and wild berries.

Fristi:

Fristi is another yogurt drink by FrieslandCampina that is

targeted amongst the younger segment group. The product
contains less yogurt compared to FreshYo, the product also
mentions Less Sugar in the packaging to emphasize the products
health appearance. The product uses a creative method of
packaging to attract its young target group. The product retails at
2.92 per liter. The product comes in 2 flavors; red fruit and peach.
20

ViFit:

Vifit is a FrieslandCampina product that is specifically created for health conscious

consumers. The product contains 0% fat and contains important vitamins such as B11, B12, and
Vitamin D. The product retails at 2.95 per liter.
Danone
Danone is the market leader in the field of nutrition and health, positioning itself around
four specialties: fresh dairy products, water, baby food, and clinical nutrition. Danone, like
FrieslandCampina, is also a major player in the dairy dessert market. They account for 8.4 % of
the dairy market. The company values corporate transparency, sustainability, innovativeness,
and quality. Most of the Danone products in Belgium are
healthy brands because health concerned consumers in
Belgium. In 2011 the company achieved a turnover of 19
billion. Some of their core dairy dessert products in Belgium
include: Activia, Danio,

Activia:

Activia is a yogurt range by Danone specified for health

conscious consumers. The product is mainly labeled as a natural
and organic diet range that promotes consumers metabolism.
Activia yogurt retails at 3.17 per liter. The product contains 0%
fat and comes in strawberry, fig, natural, fiber grains, peach,
granola, and apple flavors.

Danio:

Danio is a dairy dessert range from Danone that consists both quark
and yogurt. The range varies from low fat to full cream. The products also come
in various interesting flavors ranging from strawberry
cheesecake, vanilla, chocolate, and blueberry cheesecake to
different flavors of fruits. The product retails at 3.40 per liter.

Danone Nature:

Danone Nature is the companys product line for organic

yogurt and quark. The product ranges from low fat to full fat. This
particular product only comes in plain/natural. The Danone Nature
retails for 3.00 per liter.

21

 De Zuivelhoeve
De Zuivelhoeve is a dairy producing company originated from The Netherlands.De
Zuivelhoeve provides dairy products at areasonably high price and but with assurance of high
standards in quality. The company dates back to 1981, producing original farm-made dairy
products such as milk, yogurt, and cheese. This particular company
values a traditional brand image, which means they stick with
producing traditional dairy products, made from traditional and
original natural recipes. This company will not be following market
trends such as making their dairy 0% Fat or Organic, the
company will stick to the traditionalism of their products.

The Real Zuivelhoeve BoernYogurt

This particular type of yogurt product is famous in Belgium

amongst the elderly target group where they prefer the
traditional and natural taste. The name of this particular
product indicates that it is the real Zuivelhoeve farm yogurt.
The product comes in only full cream and contains natural or
fruit fillings flavors. This product retails for 3.74 per liter.

Dendermondes indirect competitors in the market arecompanies that don't necessarily sell
the same products as Dendermonde but offer different alternatives to satisfy the same customer
need. As a result, even though these companies might not be directly competing with each other
in the same dairy dessert industry, they still may impact each other. Indirect competition comes
from the following companies:
Vache Bleue S.A.
Vache Bleue S.A. packs, sells, and distributes cheese products in Belgium. The company was
founded in 1927 and is based in Lillois Witterzee, Belgium. The company accounts for 7.4 % of
the total dairy market. This particular company is the major player of cheese products in
Belgium. The Vache Bleue range includes products that combine healthiness with pleasure. The
company values creativity, therefore the products are designed to be
unexpected and creative such as the Selection Cuisine line of spiced grated
cheeses, it claims to add spices of creativity to all cooking recipes.
Combining the culinary market with the dairy market
emphasizes that Vache Bleue is exploring new needs in
the dairy market and fulfilling those needs. They
also have lactose free product range for lactose
intolerance consumers, another example of how
Vache Bleue is meeting new consumer needs in
the dairy market.

22

 Bel Group
Bel Group is a company originated from France, and is
well known in Belgium. With five universal core brands and
over 25 local brands, the Bel Group serves up to nearly
400 million consumers annually in 120 countries around the
globe.

The company claimed that this is derived from the pleasure of eating
food made with dairy goodness, and Bel Group's commitment to
encouraging good eating habits and good-naturedness, form the common
thread between the Group and its brands.The company reached a market
share of 4.4% in the Belgium dairy market. The company claimed that
the strategy of its success is to have a well-known knowledge of the market presence before
extending their products; this can explain why Bel Groups cheese products, especially the
Laughing Cow product line, are so well known to consumers. A thorough research of the
market ensures the company of real consumer needs and wants.

23

5 SWOT Analysis
STRENGHTS (S)
S1:

A sustainable company.

O1:

Specializes in flexibility of
production.

O2:

Leading Brand.

O3:

S2:
S3:
S4:

OPPORTUNITIES (O)

Customer relations and creative

approach towards preparations
of products.

WEAKNESSES (W)
W1:

W2:

W3:

No Manager to control the

employees, thus lack of
organizational structure.

High demands for private label

brands of dairy products.
Increasing consumer needs of
low-fat products due to health
awareness.

THREATS (T)
T1:

No clear company objectives,

strategies, and goals.

Rapid growth of demands for

natural and organic products.

T2:
T3:

High and rising milk prices.

Competitive dairy market.

EU milk quotas.

Lack of action in the marketing

department.

5.1 Strengths
S1: Dendermonde uses supplies from local farmers. The usage of local supplies reduces the
emission of carbon footprint, benefiting both the company with its eco-efficiency. A sustainable
company is proven to have enhanced brand and increase competitive advantage.
S2: Dendermonde specializes in flexibility of production, which means it is able to produce
products that comply with the business customers own specifications.
S3: Dendermondes desserts are loved by customers and admired by competitors in the same
market. Years of being in the dairy business explain their substantial experience in that specific
sector and enable them to produce the leading brands in the affordable dairy product sector.
S4: Customer relationship and creative approach towards preparation of products is considered to
be of great importance according to Dendermonde. The company has maintained a long
24

relationship with its current customers. The company is always looking for innovation with
regards to customers requirements in relation with producing their products.

5.2 Weaknesses
W1: No clear strategies, objectives, visions and goals. Not having goals or objectives is a problem
for employees, since there is no clear picture in their head of what the company strives for.
W2: There is no clear structure among employees, managers and or owners. There is no hierarchy,
which makes it hard to control employees. All the employees are responsible for their own tasks;
the absence of a marketing manager resulted to a lack of control over employees.
W3: Since the absence of a marketing manager, there are no marketing activities conducted by the
company. They lack a review of the external environment and they ignore promotional activities
that can enhance brand awareness.

5.3 Opportunities
O1: Data shows that the demands for organic and natural dairy desserts has been increasing in the
European market; consumers have increased their health-awareness and consumers have been
purchasing goods that are healthy for them and the environment.
O2: Private label yogurts have also been increasing in volume growth of 10.5%. This is an
advantage for Dendermondes current private label products sold in supermarkets causing it to
experience sales increases.
03: Low fat dairy products have also seen strong growth, with volumes up 8.1 %. This is expected
due to consumers opting for healthier options. This gives Dendermonde the opportunity to expand
their product range.

5.4 Threats
T1: A potential threat could approach Dendermonde due to the high and rising price of milk. The
increase in price will affect production costs in the company. The rising prices are due to the fact
that there is limited supply of milk available in 2013.
T2: The dairy dessert market is also very competitive due to the numerous competition (e.g.
Friesland Campina, Danone, etc.) dominating the dairy market. The tough competition serves as a
threat for Dendermonde and pushing Dendermonde to create competitive advantages in order of
surviving in the dairy market.
T3: Due to the milk quota establishment, dairy farmers have declined by 72% and dairy herd
decreased by 40-45%. The EU milk quota system was originally introducedin order to limit
public expenditure on the sector, to control milk production, and to stabilize milk prices and the
agricultural income of milk producers. The milk quota can limit Dendermondes export
opprtunities to neigbouring countries, but can increase domestic connections due to high milk
demands and low supplies.
25

6 Marketing Objectives
Category

Objectives

Financial

Market Share

Product

Brand

Customer
Relationship

Increase organization-wide sales of 10% by end of calendar

year.
Increase market shares of current products within existing
dairy markets by 0.2% within the end of calendar year.
Generate sales of new organic and low fat products to 15 %
of total sales within one year.
Increase brand awareness in the dairy market by 10% within
one year.
Improve relationship with business customers to increase 3
new distribution channels by end of calendar year.

7 Marketing Strategies
In Order to expand to Dendermondes full potential in the dairy market, Consult4u have
arranged market penetration strategy by Ansoff. This means that Dendermonde will focus in
selling existing products in existing markets. Although we will be adding two new product lines,
this product line will continue to represent the originality of Dendermondes products, the only
difference is its benefits, we will include both organic and low fat benefits.
Dendermondeseeks to achieve four main GOALS:
1) Maintain or increase the market share of current products this can
be achieved by a combination of competitive pricing strategies,
advertising, and sales promotion.
2) Secures a dominant growth in the domestic Belgian market.
3) Restructures a mature market by driving out competitors,which
would require a much more aggressive promotional campaign,
supported by a pricing strategy designed to make the market
unattractive for competitors.
4) Increases usage by existing target markets.

26

7.1 Target Markets

The targeting strategy that is suitable for Dendermonde is the undifferentiated targeting
strategy, which is targeting a broad spectrum of people that share a common interest of frequent
dairy dessert consumptions. We have identified that the needs of Dendermondes target
consumers are similar therefore by choosing this
strategy the message will appeal to all out target
consumers. The primary consumer target market
for Dendermondes products can be summarized as
follows:

Demographics:
-

Ages: 5 65

Male and female

Household income: 15,000 and above

Household type: Single & families with children.

Education of head household: College degree or above

Psychographics:
-

Health-conscious and interested in living healthy lifestyles

Believes in value for money and pays attention with what they are buying.

Favors natural simplicity products over complexity

Conscious with sustainability and the local community

Price sensitive

Spends time in evaluating alternatives before making purchases

Geographic
-

Individuals in the target groups

are likely to be located in
suburban areasinstead of big
crowded cities. This is because
they strive to live in larger and
open spaces to conduct their
healthy lifestyle activities.

27

Demographics
Below is a demographic analysis of the population in Belgium; this can give us an insight on the
feasibility of the number of our target group that makes up the entire Belgium population.
-

Total population
Age 5 65 years

=
=

10,444,268
7,937,643

The figure above showed that 76% from the total Belgian population consists of the age
brackets of 5 65 years. This amount shows that we have better chances of optimizing our sales
volume due to the numerous targeted populations.
When looking at the information about income distribution in Belgium, we want to keep in
mind that demographic characteristics usually play their role in the income that will be paid.
According to the latest Annual Survey of Hours and Earnings, age plays an important role in the
gross income you should expect.The age group with the highest income is the 40-49 years old
group, where the median of the gross weekly earnings was at 541.7. The median of the 22-29
years old group was 409.
With these report we can clearly position our product price according to the income earnings
of our target group. Dendermondes products should be fixed with an inexpensive price since they
are not creating a luxurious image; theyre products are valued as healthy, affordable, and natural.
Psychographics
To analyze the target groups lifestyle, we went further into dividing Dendermondes target
group according to their psychographic characteristics. This implies that they can be grouped
according to the following:

Social Class: The social class of our target group is basically families consisting of a working
class parent and their children. Most parents in this class are skilled, middle, and lower
working class categories. They spend time in shopping for products with health benefits and
are easily driven by the distinctive quality of the product they want to purchase.
Lifestyle Factor:We believe that Dendermondes target groups are Reformers. Reformers are
groups of people that believes in freedom from restriction, induces personal growth, value for
time, tolerance of complexity, anti-materialistic but intolerant of bad taste. These type of
people are very curious and supports the growth of new product categories. As for brand
choices, they favor natural simplicity and select brands for intrinsic quality at a reasonable
price.

28

Geographic
Suburban areas are the typical choice for our target group because they favor simplistic
suburban lives over the busy and complex metropolitan areas. We will choose the most
populated suburban areas to centralize our marketing activities in order of reaching
Dendermondes target groups. The capital region of Belgium, Brussels, is the most populated
region with1,138,854 inhabitants. Dendermonde can target popular areasshown in the table
below.
Areas
Population
Brussels

1,138,854

Antwerp

502,604

Gent

231,493

Charleroi

200,132

Brugge

116,709

Namur

106,284

Leuven

92,892

Mons

91,277

As we can see from the above, we would start from the most populated region, Brussels, and
then proceed downward as shown in the table above. We plan to cover other remote counties in
the Belgium as we make progress in our research on various geographical regions across Belgium.
Cities shown in the table have a large number of stores, the cities also have vast numbers of our
target group and so we will be anticipating a high sales margin.
Age
5-12 years

35-50years

Educational level:

Low

High

Brand awareness:

Low

High

Quality demand:

High

High

Brand loyalty:

High

Average/ High

Potential market:

High

High

Main Target Group:

From the list above we can easily say that the age group between 35-50 years scored
highest compared to the other groups. Therefore, adults within the age of 35 50 years old are
Dendermondes main target group. This target audience makes up approximately 2.1 million of
the current Belgian population.
29

We believe that these target audiences values the high importance of healthy nutrition
and quality. High quality is thetarget groups first inspection element in persuading buying
behavior.Dendermondes target audience feels responsible for the environment and tolerates
the use of product containing chemicals. Overall, this target group is searching for goods that
meet the standards of health and sustainability.
This type of target group is generally also concerned with their health and personal
appearance. These consumers prefer purchasing products with less fat content. This is the
reason why Dendermondeis including choices of Low Fat to their product range. The
availability of the low fat product ranges will increase the chance of purchases from this type of
target group.
When it comes to purchasing, Dendermondes customer are very price sensitive. This is
due to the value for money mind set orientation. When comparing two similar products,
Dendermonde consumer will go for cheaper brand alternatives that promote sustainability;
they will also choosecheaper unknown products that offer the same value as branded products.
This consumer group does not necessarily think that expensive branded products would
bebetter and of higher quality than the cheaper ones. This consumer group feels satisfied when
purchasing products with numerous beneficial values at a reasonable price.
Dendermondes products will be desired as an affordable product that still provides
health and sustain benefits to its target consumer.The target audience also wants to experience
a new sensation of natural taste. In the advertisings, we will accentuate Dendermondes use of
ancient farmers traditions and secret homemade recipes in creating their tasty dairy desserts,
to promote the products sensation of natural taste, made by only natural ingredients produced
by local farmers.
The motive to buy Dendermondes product is shown in the fact that there are only several
dairy dessert producers who are offering organic dairy desserts to consumers. Dendermondes
target audience does not want to taste chemicallyinduced dairy products due to their health
awarenesss. Dendermonde will offer consumers realingredients in their desserts. The organic
dairy desserts will be renowned for its purity, clean taste, and natural flavors.
Subsidiary Target Group:
From the list above we can see that the age group between 5-12 years scored lowest
compared to the other groups. Therefore, children within the age of 5-12 years old are
Dendermondes subsidiary target group. This target audience makes up approximately 820
thousand of the current Belgian population.
Another reason why children group scoredlower is because we cannot judge the children
market by how much money they have or how highly educated they are. Dendermonde has a
product specifically designed for children. The packaging is designed to be creative to attract
child consumers. The children market are interested in great taste and colorful appearance.
Dendermonde can attract more children markets by improving its product through designing
in more colorful packages for this particular market.
30

We can also see this group as a stepping-stone in order for Dendermonde to penetrate
their first target group, adults. To some extent , children s needs can directly influence their
parent s purchasing behavior . Most of the population in the first target group is considered to
bea household consisting of parents and their children therefore children plays an important
role for reaching our first target group.
Business as a Target Audience:
As a second target group, we have identified thebusiness-to-businesscustomers, which
are Dendermondes retailers, namely supermarkets/ hypermarkets, and independent retailers.
It is very important to choose the retailerswisely because they areactive participantsthat
influence the perception ofend consumers towards Dendermondes products.
Dendermonde needs to establish a long-term and well communicating relationship with
their business partners. To attract and to maintain good relations with business customers we
will make use of a variation of promotional tools, such as improving discount policies, which
will be explained in the promotional strategies.

7.2

Branding

Dendermondes brand is the companys promise to its customer. It tells them what they can
expect from the products and it differentiates Dendermondes offering from its competitions
offering. Since the brand is derived from how Dendermonde is perceived, we would suggest
Dendermonde to make their products to be
perceived as a low-cost and high value brand that
delivers sustain and health benefits to its target
customers.
Logo
To enhance the image of natural goodness, health,
and sustainability, Dendermondes productswill
have a new logo design that will remind target
customers of nature, hence the green leaf above the logo. The color green in logo can
emphasize nature and serenity. The color green in logo reminds customers of nature, the idea
of nature relates the product to natural and healthy goodness.

31

7.3

Product Positioning

Product positioning is the perception in the consumers mind of the nature of a company
and its products relative to competitors. We recommendDendermonde to use the product
attribute approach. The fact that their dairy desserts uses natural ingredients from local
farmers are features that sets the product apart from the competition.
There are three components making up attitudes and behaviour towards products, these
components are Cognitive, Affective, and Conative. The cognitive component is made up of the
consumers understanding, image and knowledge of the product. In the case of Dendermondes
dairy desserts, the consumer will learn or know that the products are natural and sustainable,
which is very beneficial for ones health and environment. Secondly, the affective component
occurs, which is the feelings and emotions the consumer develops towards the product: a
person may feel or believe that he or she will be more healthy when Dendermondes dairy
desserts. Thirdly, the conative element takes place because of the consumers actions and
behaviour, which lead to the purchase of Dendermondes dairy desserts.
Perceptual Map
UPSCALE

HIGH PRICE

LOW PRICE

DOWNSCALE

Perceptual Map Summary

From the map we can deduce that Danone is right within the high price
andupscaleposition, which means consumers view theirproducts as high quality being
purchased at a premium price. Other competitors like FrieslandCampina, Bel Group, and Vache
32

Bleue also fall within this range. Danone has an average of higher prices and quality products
when compared to other competitors.
De Zuivelhoeve has a relativelyaffordable range of dairy products and optimal standards
for quality therefore this company placed within the downscale and low-priced segment. We can
see that the column for low price upscale dairy products is blank because consumers will not
buy a premium dairy product at a low price. It is either they go for a downscaleproduct at a low
price or buy an upscaledairy product at a high price.
Unique selling point
Dendermondes product has a truly unique feature that sets itself apart in the market. It
offers an affordable alternative with the same healthy benefits as other expensive premium
products. The natural recipes and fresh local ingredients really stand out to consumers looking
for affordable products with health and sustainable values.
Positioning Statement
For the middle-Belgian consumers seeking for sustainable and healthy dairy desserts,
Dendermondes brand provides an affordable and satisfying choice.

7.4

Product Strategies

Three Layers of Products

Core Product
The benefit that Dendermondes products will provide customers is its affordable
health and sustainable benefits. The use of natural ingredients and supplies from local
farmers ensures the well being of both the customer and the environment.
Dendermonde serves dairy desserts with quality tailored for customers needs.

Actual Product
Dendermondes dairy desserts come in 7 delicious flavors; Strawberry, yellow fruit,
apricot, peach, blueberries, mix berries, and vanilla. The product comes in three types
of product

line,

which are

Dendermonde Original, Dendermonde Organic,

andDendermonde Low Fat.

Augmented Product
The augmented part of Dendermondes products is the fact that the product has
accessibility. Dendermondes products are sold in supermarkets and independent
retailers that are very accessible for target consumers.
33

New Product Lines

To increase its leverage in the market and to meet its sales objectives, Dendermonde needs
additional products. Two new product lines are planned:
1. Dendermonde Organic:
This new product line will be introduced to
the market to meet the high consumer
demands for organic products. This product
contains organic and natural ingredients to
satisfy the taste buds of Dendermondes
health-conscious consumers. The product
comes in six unique flavors:
- Apricot
- Yellow fruit
- Strawberry
- Vanilla
- Mixed Berries
- Peach
2. Dendermonde Low Fat:
This product line is specifically designed for
the self-conscious consumers opting for a
healthy alternative. The Dendermonde Low
Fat dairy desserts will have approximately
75% less fat than the original dairy desserts.
The low fat range will come in the following
four flavors:
-

Strawberry
Blueberry
Peach
Vanilla

34

Packaging
We believe that the product packaging can play a role in the success or failure of the sales of the
product; the purpose of packaging is much more than just containing and protecting the products,
how a product is packaged may be what attracts the customers to take a look on the products as it
sits in retail shelves. Dendermonde will need to emphasize the design of simplicity and nature in
its packaging. The label All Natural and Local Farmers will be attached in the packaging to
increase the healthy appearance of the products. The organic product lines will include the label
Organic and the low fat products will include Low Fat labels in the packaging to differentiate
them from the original packaging. The packaging will include the nutritional value, ingredient
contents, company website, and customer service number.
Private Label Brands
Dendermonde will continue producing for its current private label products in order of
complying with the sales objectives. Dendermonde will include three additional private label
brands, namely:

Pur Natur
During 2009, Dendermonde was producing organic desserts for the Pur Natur private label
but due to a production halt, the production has to stop. The re-launch of the organic product
range will enable Dendermonde to produce for this private label again.

Albert Heijn
Dendermonde will start producing desserts for the house brand of the supermarket called
Albert Heijn. The original dairy dessert products will fall under the label AH Huismerk/ House
Brand. The organic and low fat product range will fall under the AH Puur&Eerlijk brand which
are the private labels consisting of organic and environmentally beneficial products.

Carrefour
Dendermonde will be producing for the house brand of the supermarket Carrefour. The house
brand will include all of the three product ranges, the original, organic, and low fat.

35

7.5 Pricing Strategies

The pricing for Dendermondes products will be decided based onthe market orientation.
This type of strategy would be getting a price based upon analysis and research compiled from
the target market. This means that Dendermonde will set prices depending on the results from
the market research. For instance if the competitors are pricing their products at a lower price,
then Dendermonde should put a price below the price of the competitors to attract more
consumers.According to Porters generic strategies, Dendermondes products would fall under
the cost leadership model, which means the company delivers a good quality product at a lower
price than the competitors. Another way of positioning Dendermondes pricing would be a
penetrated pricing, which means Dendermondes products will be the low-priced within the
market but offers a great deal of value.The current prices for Dendermondes products are as
follows:

(Table 7.5 A - Price List)

Competitors Price:
Dendermondes prices are going to be lower than its competitors. This is part of the pricing
strategy to create a competitive advantage in order for consumers to opt for Dendermondes
products. The price list for Dendermondes competitors are shown in the table below:
Types of Product

Price (Per KG)

Danone Activia
Danone Danio
Danone Nature
Campina FreshYo
Campina Fristi
Campina ViFit
De Zuivelhoeve Boer'nYogurt

3.17
3.40
3.00
2.71
2.92
2.95
3.74
36

7.6 Promotion Strategies

In the past, Dendermonde has used mainly personal selling to promote its products to the
distribution channels. We will continue using personal selling to increase the Dendermondes
distribution channels in order to generate more sales. The personal selling has previously been
handled directly by Dendermondes sales team to the retailers; this is called a point-of-sale
merchandising.
Point-of-sale merchandising can be said to be a specialist form of personal selling. This type
of merchandising involves face-to-face contact between Dendermondes sales representatives
and the retail trade. Dendermondes sales representative will visit a range of suitable retail
premises in the target area and encourage the retailer to stock products from the product
range. The visit also provides the opportunity for Dendermonde to check on stock levels and to
check whether the product is being displayed optimally.
To support this personal selling approach, we came recommend that Dendermonde promote
itself through internet marketing in order to introduce its new product lines and meet its
marketing objectives of boosting the companys awareness.
Internet Marketing:
Internet Marketing can provide significant benefits to an organization by providing a reach,
range, and scale that before the Internet was invented it was not possible. The convergence of
technology has also driven an increase in the number of devices organizations can leverage to
reach their target market.
Website
Firstly, a proper company website for Dendermonde will be created. The first and most
obvious advantage of a business website is the potential for reaching a wider audience. The
Internet is used by millions of people and all of them are looking for something. So taking the
business online will potentially allow Dendermonde to take advantage of the growth and expand
its business. Even if Dendermonde has no intention of using a business website to sell,
Dendermonde still might want to let their customers know about their business. People
commonly research businesses online before actually visiting the business location. So having a
well designed website will help encourage them to come and visit Dendermonde or be able to
find out about the company.
Dendermondes website needs to be well structured in order for customer to
beprovidedwith necessary information about the company. Also, there will be a catalogue of the
product range in the website. For business customers there will be an option of ordering
products in the website and detailed contact information of the sales department (telephone, email and address). The website will be available inFrench, Dutch, German, and English. The
website URL is www.Dendermonde.com.

37

Cost of creating a website:

- Domain Name
- Hosting
- Web Design
- Website Maintenance Total Cost for Website

= 10
= 150
= 2000.
= 500 per year.
= 2160 (Plus 500 per year for maintenances.)

Social Media
Facebook and Twitter are the social media platforms most commonly used
for marketing. Facebook offers the option of creating a fan page for a company or
product, while Twitter makes use of a limitation of 140-character posts that users
follow. Blogs are online journals written by users, which can be influential in
spreading news and information. YouTube is a repository for podcasts and
videos, with a viewership of millions around the globe. Some sites offer display
advertising options, but the majority are simply a method of sharing information with others.
The most visible advantage of social media advertising is that it is very cost-effective, some sites
such, as Facebook, Twitter, and YouTube, are free of charge.
Dendermonde will create a Facebook, LinkedIn,
Twitter, and YouTube company account in order to
easily communicate with their consumers.
Dendermonde can introduce the new product lines and post the advertising and news about the
product in the social media networks, making consumers aware of it anywhere and at any time.
E-Mail Marketing
To stay constantly in the memories of our customers, Dendermondes sales team will be
sending promotional information to customers through emails with the purpose of enhancing
Dendermondes relationship and to encourage customer loyalty. In the e-mails, the sales team
will inform our customers about new insights, promotions, and developments within
Dendermonde. The main tasks of e-mail marketing for Dendermondes sales team are:

To send email messages with the purpose of enhancing the relationship of

Dendermondewith its current and previous customers, as well as encouraging customer
loyalty and repeat business.
Sending email messages with the purpose of acquiring new customers and convincing
current customers to make purchases of Dendermondes products.
Adding advertisements and newsletters to e-mails and sending it directly to customers.

Sampling:
Dendermonde can introduce its new product
range by sampling. The purpose of a free sample is
to acquaint the consumer with a new product. It is
similar to the concept of a test drive, where the
38

customer is able to try out a product before purchasing it. Sampling of Dendermondes products
at selected supermarkets will provide an opportunity for prospective customers to become
aware of the product and to taste the great flavors. Sampling will include only organic and low
fat products, which are products that are being introduced. Venues for sampling will be in
supermarket where Dendermonde uses its own brand name such as Spar, Aldi, Champion, and
Intermarche.
Cost of sampling:
- Products (7,000 units)
- Supermarket Contract
- Retail Sales Person
Total Cost for Sampling

= 8,400
= 4,000
= 18,000
= 16,900

Magazine Advertising:
Consumers in Dendermondes target market are avid magazine readers,
thus magazine advertising will be attempted this year. Dendermonde will
advertise through a health and lifestyle magazine in Belgium called
BioGezond. The magazine reaches up to 567,000 readers annually; these
readers compose of well-educated readers with average income, they also
have an interest in improving their health and lifestyle. 52%
percent of readers are below 49 years old while the rest are
above. This shows that BioGezond is the right choice
forDendermonde because of the suitable target consumer
group. The website of the magazine will also serve as a great
promotional with 120,000 page views.

7.7

Cost of magazine advertising:

3 months, Page
Online, Homepage Banner
Total Cost for magazine Adv.

= 10,722
= 4,000
= 14,722

Supply Chain Strategies

In the past, Dendermonde has targeted three categories of distributions:
-

Supermarkets / Hypermarkets

Independent Retailers

Exports

To increase distribution and sales of its products, Dendermonde will focus on distributing to
supermarkets in Belgium. Dendermonde will not conduct exports until the health and profitability
of the company has been regained.This is because the company needs to focus in strengtheningits
distribution chains in Belgium by this year in order of meeting its objectives. Dendermonde will
39

continue to distribute to its existing retailers in Belgium with the addition of Albert Heijn and
Carrefour as private label brands, and Aldi as its own brand.
Albert Heijn
Albert Heijn (AH) is a supermarket established in Netherlands
that became quite popular in Belgium. Although AH is considered
to be selling middle to high priced products, the supermarket has a
range of house brands that is well known by AHs customers. AH is
one of the biggest supermarkets in Belgium with high market
shares, the types of retail store includesconvenience markets and
hypermarkets. The stores are located in almost every city in
Belgium and the reason why we chose Albert Heijn is because we
think that Albert Heijn will help Dendermonde in generating more
sales because of AHs popularity.
Carrefour
Carrefour is a French retailer that became popular as supermarkets,
convenience stores, and hypermarkets in Belgium. Carrefour has one of the
largest chains of hypermarkets around the world. The company rates
number two in highest earning revenue amongst hypermarkets. This
company can direct Dendermonde into generating more sales due to its
wide target consumers, easily accessing Dendermondes products.
Aldi
Aldi is a German discount store and supermarket that also became
popular in Belgium. Aldi is seen as an affordable choice supermarket
therefore Dendermonde can use its own Brand for this supermarket.
Aldi is sure to be well known by Belgian consumers due to its high
revenue of 58 Billion. A German market research states that 95%
of blue-collar workers, 88% of white-collar workers, 84% of public
servants, and 80% of self-employed people shop at Aldi. This type of
target group suites Dendermondes target market that are made of
customers looking for affordable yet valuable products.
We

recommend

Dendermonde

distribute

mainly

through

supermarkets and hypermarkets mainly because by selling through those channels,Dendermonde

will be more accessible for its potential consumers. We chose to channel as a private label brand to
AH and Carrefourbecause the Return on Equity is 13.4% and 6.73% respectively. The benefit of
selling to private label brands is the obvious high profit margins. Dendermonde will only have to
produce the product and ship it to the supermarkets distribution center while the retailer manages
the shelf spaces, marketing and branding of the products.
40

As an alternative to exclusivity, or in addition to it, Dendermonde could also operate as a

wholesaler of private label brands and offer limited access to other retailer who pays Dendermonde
premium acquisition costs for the right to carry Dendermondes brand. This not only generates
more income, but it also spreads the exposure of Dendermondes brands even further. A
relationship with a high volume reseller can lead to more customers buying Dendermondes
brands. The most important part of the supply chain strategy is the creation of accessibility, selling
through supermarkets or hypermarkets will create more accessibility for Dendermondes target
market rather than independent retailers.

8 Implementation
8.5

Sales Forecast
We believe that the following activities that we have planned fore Dendermonde will

influence sales for 2013:

New product ranges

(+3.0%)

Promotional Activities

(+2.5%)

Increased private label brand sales

(+1.5%)

New distribution channels

(+3.0%)

The two added product range, organic and low fat desserts,would affect sales tremendously
due to the fact that the demands for these types of products areskyrocketing. An estimated of
3.0% increase in sales will be forecasted due to more volumes of sales. The promotional activities
will help boost sales of Dendermondes brand; the increase in brand awareness is estimated to
affect 2.5% of increased sales. The current niche for affordable and healthy products are boosting
sales of private label brand sales, more customers are opting for a healthier and cheaper
alternative, causing an estimated rise of 1.5% of total sales due to gained purchases of private
label products. The new distribution channel; Albert Heijn, Carrefour, and Aldi, are estimated to
contribute a 3.0% increase in total sales due to the increases of sales volumes to be sold.With the
new forecasted sales, the estimated new market share of Dendermonde in 2013 will be
approximately 2.2%. The increase in market share is mostly due to competitive pricing strategies,
promotions, and increased overall sales within Dendermonde.

41

Dendermondes Sales Forecast 2013

Month

Previous
Sales

June
July
August
September
October
November
December
January
February
March
April
May
Total Sales

903,333.00
903,333.00
903,333.00
888,333.00
873,333.00
873,333.00
873,333.00
873,333.00
873,333.00
888,333.00
903,333.00
903,333.00
10,660,000

Optimistic
Forecast
1,056,861.55
1,056,861.55
1,056,861.55
1,039,312.18
1,021,762.81
1,021,762.81
1,021,762.81
1,021,762.81
1,021,762.81
1,039,312.18
1,056,861.55
1,056,861.55
12,471,751

Average
Forecast
997,039.20
997,039.20
997,039.20
980,483.19
963,927.18
963,927.18
963,927.18
963,927.18
963,927.18
980,483.19
997,039.20
997,039.20
11,765,803

Pessimistic
Forecast
937,216.85
937,216.85
937,216.85
921,654.20
906,091.55
906,091.55
906,091.55
906,091.55
906,091.55
921,654.20
937,216.85
937,216.85
11,059,855

From the table Dendermondes Sales Forecast, the Optimistic, Average, and Pessimistic Forecasts
were calculated based on average uses of products per year by Dendermondes current customers.
The Optimistic Forecast was calculated using an estimated heavy usage of 53 products per year. The
Average Forecast was calculated using an estimated average usage of 50 products per year. The
Pessimistic Forecast was calculated using an estimated light usage of 47 products per year. We
estimated the demands using the Chain Ratio Method; the data used to calculate the estimations for
2013 are shown in the table below:

The Chain ratio method is an analysis tool especially offering optimistic forecasts. The chain ratio
methodbased the forecasts on market trends instead of actual orders and inquiries, which best suits
the company due to Dendermondes lack of sufficient company data. We can conclude that the
overall forecasted sales for Dendermonde would increase 10% by the end of the calendar year. The
forecasted sales increase results to a 0.2% increase of market share, making it 2.2% in 2013.

42

8.6

Action Plan

The action plan details activities necessary to implement all marketing strategies. In addition,
the action plan includes the timing for each item, the individual responsible, and the budgetary
requirements.
Objective 1: Increase 10% sales by the first year.
Action Plan 1: Increase Distribution Channels
Action Items
1. Identify key
supermarkets,
hypermarkets, and
convenience stores
where
Dendermondes
products can be
sold.
2. Make initial
contact with larger
supermarket
chains; Albert
Heijn, Carrefour,
Aldi.
3. Follow up initial
contacts with all
potential resellers
and obtain contacts
for coming month.

Beginning
Date
June 1

Ending
Date
August 1

Responsible
Party
Marketing
Manager

Cost

Remarks

46,800

A marketing manager
will be hired therefore
the cost will be the
annual salary.

August 1

October 1

Marketing
Manager

2,000

Travel expenses.

August 15

Ongoing

Marketing
Manager and
Sales
Representatives

15,000

15,000 are budgeted

for travel expenses
although actual
expenditures are asneeded basis and
cannot be preplanned.

Responsible
Party
Marketing
Manager

Cost

Remarks

3,000

3,000 are budgeted

for research
expenditures.

Action Plan 2: Launch new product lines

Action Items
1. Analyze the external
environment to
identify potential
opportunities and
threats withholding
the company that
could affect the
products.
2. Aware current and
new customers of the
new products range
availabilities through
promotional tools and
contacts.
3. Visit retail channels
of product lines to
review the products
shelf positioning.

Beginning
Date
June 2

Ending Date

June 5

September 5

Sales
Representativ
es

10,500

500 are allocated

for pamphlets,
brochures, and
10,000 for travel
expenses.

July 1

Ongoing

Marketing
Manager

5,000

Travel Expenses.

Ongoing

43

Objective 2: Increase 10% brand awareness in the first year.

Action Plan 3: Increase Brand Awareness
Action Items

Beginning
Date
June 4

Ending Date

Responsible
Party
Marketing
Manager

Cost

Remarks

2,660

June 11

Marketing
Manager

June 10

Ongoing

Sales
1,000
Representatives

The cost of building

the website. This cost
is applicable per year.
The company profile
represented in the
sites should look
attractive and
interesting.
The budgets are
allocated for logo,
brand, and newsletter
design.

2. Create social media

networks: Facebook,
YouTube, LinkedIn,
and Twitter.

June 10

3. Prepare logo and

brand. Send
advertisements and
newsletters about the
company to customers
through email.
4. Prepare advertising
material for BioGezond
Magazine.

June 15

June 25

Marketing
Manager,
Advertising
Designer

15,722

6. Review placement of
Advertising.

September 1

December 1

Marketing
Manager

7. Sampling of new
product range in
supermarkets.

December 1

March 1

Sales
16,900
Representatives

1. Development of
company website

July 6

1,000 are allocated

for the advertisement
design and 14,722
for the actual
advertising cost.
Placement of the
advertising will be
inspected thoroughly.
Sales representatives
will visit different
supermarkets to
sample its products
within 3 months.

Objective 3: Construct a fully operational marketing and sales team.

Action Plan 4: Fully Operational Marketing Department
Action Items
1. Marketing staff
briefing; allocation of
new marketing
manager.
2. Cross-training
between employees.

3. Employee event;
product launch
celebration.

Beginning
Date
June 1

Ending
Date
June 1

Responsible
Party
CEO, Marketing
Manager, Sales
Representatives

Cost

Remarks

June 2

Ongoing

Marketing
Manager, Sales
Representatives

September 5

September 5

All Staff

1,000

A proper employee
introduction is crucial
in building cooperation.
Cross training are to
be conducted weekly
to ensure useful
knowledge is shared
between the staffs.
Rewarding employees
to improve motivation
during work.

44

8.7

Budget

Marketing Budget Plan

1)
2)
3)

4)

Research
Employee Events
Advertising:
- Website
- Logo
- Magazines
- Sampling
- Brochures
Travel

3,000
1,000
2,660
1,000
15,722
16,900
500
32,000

Total

72,782.00

9 Measurement and Control Strategies

Dendermondes marketing strategies are required to be monitored, evaluated, and adapted to
meet the changing market environment, needs, and opportunities. Marketing control ensures
performance improvement by minimizing the gap between desired results and actual results.
If the actual results of the plan are found deviated from the expected results, plans and
strategies can be adapted to bring the results back to the desired level. In order to perform
marketing control, a variety of activities will ensure effective measurements of the success of
the marketing plan and allow the firm to make adjustments as necessary. This includes
market research and trend analysis that will be conducted. The marketing manager will be
responsible for these duties.
9.5 Research
Dendermonde needs to conduct a continuous market research to understand brand
awareness and brand attitudes among their target groups. Dendermonde will therefore
commission exploratory research and descriptive benchmark studies of its target consumer
and reseller markets in a monthly basis.
9.6

Trend Analysis

Dendermonde will do a monthly trend analysis to examine sales by reseller type, geographic
area, chain, agent, and distributor. These analyses will allow Dendermonde to take corrective
action when necessary.

45

10

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46