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PMCI Analysis
Product
Marico limited is one of India’s leading consumer goods companies providing consumer
products and services in the area of health, beauty and wellness. Marico is present in over 25
countries across emerging markets of Asia and Africa. It nurtures multiple brands that expertise
in categories of hair care, skincare, edible oils, health foods, male grooming , and fabric care.
Marico believed in adding more nutrition to your food and more flavour to life. With this motto,
‘Saffola Fittify Gourmet’ and ‘Coco soul’ products are introduced and the range has been
carefully created by nutritionists and curated by celebrity chef Kunal Kapoor to combine the
best of taste with health for a slimmer fitter life.
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COCO SOUL:
Coconut Coconut
Oils Spreads
Sugar Chips
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MARKET
Marico has flat organised structure with five levels between the managing director and floor
operator.
While the current inflationary inputs costs may impact profitability in the first half, the
company believes that focus on franchise expansion with threshold margins will stand them in
good stead to write a medium-term profitable growth story.
Homegrown FMCG major Marico NSE 1.23% is targeting an 8-10 percent volume growth in
the country along with healthy market share gains.
“For FY19 and beyond, Marico retain the target of 8-10 percent volume growth in India
accompanied by healthy market share gains. Accelerated innovation and focus on digital will
be strong enablers.
The leadership team's focus on nurturing new engines of growth in premium hair nourishment,
male grooming, skin care and healthy foods shall ensure broad-based growth in the coming
years.
The company that makes Parachute and Saffola, is also bullish on the rural consumption in
2018. .With rural sales contributing 32 per cent of domestic revenues, the company expects to
take this up by at least 3-4 percentage points in the next 3-5 years by driving penetration
through price point packs and focused go-to-market initiatives.
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COMPANY
Profile
Marico Limited is one of India's leading consumer products companies operating in the beauty
and wellness space. Currently present in 25 countries across emerging markets of Asia and
Africa, Marico has nurtured multiple brands in the categories of hair care, skin care, edible oils,
health foods, male grooming, and fabric care.
Headquarters: Grande Palladium, 175, CST Road, Kalina, Santacruz, Mumbai, Maharashtra,
India
Marico Limited is a fast-moving consumer products and services company which is operating
in the beauty and wellness space.
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INDUSTRY
Industry size:
The Retail market in India is estimated to reach US$ 1.1 trillion by 2020 from US$ 840 billion
in 2017, with modern trade expected to grow at 20 per cent - 25 per cent per annum, which is
likely to boost revenues of FMCG companies. Revenues of FMCG sector reached Rs 3.4 lakh
crore (US$ 52.75 billion) in FY18 and are estimated to reach US$ 103.7 billion in 2020. The
sector witnessed growth of 16.5 per cent in value terms between July-September 2018;
supported by moderate inflation, increase in private consumption and rural income.
CAGR of Industry:
CAGR of FMCG industry is expected to grow 27.86% by 2020. The sector is projected to grow
11-12% in 2019.As it witnessed the growth of 16.5% in value terms between June-September
2018. FMCG’s urban segment is expected to have a steady revenue growth at 8 per cent in
FY19 and the rural segment is forecasted to contribute 15-16 per cent of total income in FY19.
Revenue 6.69%
Net Income 2%
EPS Basic 2%
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SWOT Analysis
Strength Weaknesses
Offer high quality and healthier products. Highly priced than other products.
A wide range of vegan food items. Poor inventory management control
Good customer service.
Opportunities Threats
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Potter’s Five Forces Model
The Five Forces are: the threat of entry into an industry; the threat of substitutes to the
industry’s product or services; the power of buyer of the industry’s products or services; the
power of suppliers into the industry ; and the extent of rivalry between competitors in the
industry
The Threat of entry barriers , which Porter states that ‘‘The threat of entry in an industry
depends on the height of entry barriers that are present and on the reaction entrants can expect
from incumbents. If entry barriers are low and new-comers expect little retaliation from the
entrenched competitors, the threat of entry is high and industry profitability is moderated. It is
the threat of entry, not whether entry actually occurs, that holds down profitability.
“Adolescents are the consumers of tomorrow; therefore, policies aimed at increasing organic
food consumption should address the needs of this group.’’ the force of barrier of entry, which
are the existing competitors in different markets. It is planned to offer different types of foods
that adolescents consume most, it is appointed that fast food is one of the most consumed foods
by young people, so it is attended to develop a business strategy that will create an organic and
sustainable fast food brand that will not only give sustainable food, it will also bring nutrition
education that will generate more market growth leading to a popularity success of the organic
food industry.
The Majority of adolescents are always consuming fast foods from non-sustainable companies,
it is pretty important to focus on this young niche of the market, because they will always be
the future business consumers of the world. The threat of barriers and Rivalry between
competitors which Porter states that ‘‘Rivalry among existing competitors takes many familiar
forms, including price discounting, new product introductions, advertising campaigns, and
service improvements. High rivalry limits the profitability of an industry. The degree to which
rivalry drives down an industry’s profit potential depends, first, on the intensity with which
companies compete and, second, on the basis on which they compete.’’
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2.Rivalry among existing competitors:
3.Power of Suppliers:
The threat of substitutes which Porter states that ‘‘When the threat of substitutes is high,
industry profitability suffers. Substitute products or services limit an industry’s profit potential
by placing a ceiling on prices. If an industry does not distance itself from substitutes through
product performance, marketing, or other means, it will suffer in terms of profitability and often
growth potential.”
Today’s customers know the serious damages that genetically modified food and food that is
cultivated with herbicides and pesticides are affecting health and environment. This could lead
to a substitute of products by getting to consume more organic products than traditional
groceries. Although , there is ratio of quality/price which shows that customers are willing to
pay more for organic food than having diseases as an effect on health. Porter’s business model
will build a business strategy that will encourage customers to purchase Organic Food in step
of Traditional groceries (GMO or non-sustainable food).
It shows the impact of ethical motivations, food safety and health-related concerns on
purchasing intentions of habitual and less frequent consumers of organic food’’. The bargaining
power of buyers will be the force that is going to be linked with the article, Michael Porter
states that “Powerful customers— the flip side of powerful suppliers can cap turn more value
by forcing down prices, demanding better quality or more service (thereby driving up costs),
and generally playing industry participants off against one another’’.
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Buyers are starting to buy for organic food from sustainable farms, firstly because its cheaper
than getting directly to the supermarkets , and secondly that encourage and support local
organic farming, having an increase of sales in the organic food industry . Also some customers
are trying to get connections with organic farms for getting to know how to crop their own food
in a sustainable way, and having as a result the switch of buyers for lower cost products and
the buyer competition threat.
5.Threat of Substitutes:
“ Higher sales and margins are key goals for retailers promoting emerging products, such as
organics, but little is known about their marketing effectiveness and their cross-effects on
conventional product sales.
The threat of substitutes will be force, the organic food industry needs to create a business
strategy that involves a good promotion plan which will show customers the product or service
ratio price/quality that will encourage them to get the products. Most of the organic food
industries does not know how to prepare a good marketing plan , which today do not give the
pros and cos of organic food and traditional food ( Gmo ,pesticides).It says that the marketing
environment, and as well to establish business strategies for implementing a deeper promotion
plan in the organic food industry.
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Details of the Project work
Direct marketing for Fittify range by Marico, and to identify lever for product adoption among
consumers. Focus to be in following areas
Product Communication
Visibility elements
Sampling
Other relevant activations for the brand inside the store like consumer offer etc.
As well as In-store promotions are a highly effective marketing tactic designed to bring
customers to your brick and mortar store and build brand or product awareness.
How consumer perception influences business
Pricing of a product has a key effect on consumer perception. Though a large majority of
consumers appreciate and favour a low or reasonably priced item, there are also cross
sections of sophisticated and sceptical consumers who look down up a product that is
considerably low priced than the others available alternatives.
Hence pricing of a product or service should form the basis of larger marketing plan. By
doing so, even low priced products can be marketed as favourable ones with good quality
and at a better price.
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2. Quality of a product
The importance of the quality of a product or service from the perception o a consumer
can never be undermined. Any feature of the product such as its uses durability and how
reliable the product is satisfying or disappointing the consumer can be described as its
quality
Marketing to a great extent helps in influencing the consumer’s perception about the
quality of product but even word of mouth communication about quality of a product is
equally effective and travels fast.
Though marketing plays a greater role in influencing the consumer’s opinion about
quality of a product, it is the consumer’s inherent opinion from the use of a specific
product or service that will determine the awareness about quality.
First impression is the best impression very aptly applies to consumer perception of a
product especially at the time purchase. How a product is attractively packaged to exhibit
the display quality by the manufacturer determines the perception of the product. Even
branding messages such as reliable, long lasting tough are of great help in promoting the
product perception.
History and reputation of a company and its products and service plays an equally
important role in the consumers perception. Age old businesses with strong reputation
and history are always preferred by consumers whereas new products are always tried
with caution and based on public opinion and reviews.
Online and offline reputation of a company and products and services largely influence
the consumer perception. Any negative reviews and opinions online or by word of mouth
can strongly affect the overall performance of any business. If any product has not
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performed well in the past or if any company has been alleged for any unscrupulous
activity will strongly affect its performance for long period of time.
In- store promotions are any marketing or sales promotion that is done in a brick and mortar
business location. In-store promotions are a highly effective marketing tactic designed to
bring customers to your brick and mortar store and build brand or product awareness. With
the help of In-store promotions we can increase the Point of sale ( POS).
With POS advertising , the promotion is advertised in store, where customers or clients pay
you for your business. If a customer who walks into the Retail outlet on their way may see
your products signage or POS advertising, about the promotion and purchase the products
than he/she originally intended . This is an effective way to use POS advertising to encourage
impulse purchase.
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Project work area deliverables:
Objective of the report:
The Primary objective of the project is to understand customer perception in Modern trade
outlets for premium healthy food products and develop them into actionable consumer insights
that can help in accelerating brand adoption by the target consumers.
Scope:
The report’s scopes are followed below-
• During our internship we are limited to only one store, we only know the buying
behaviour of the consumer who are in that location and who visits the store.
• In collecting the primary data from the customers its really hard as the information
provided by them may be of false feeling
• Through mall intercept we can collect the genuine data but it is the time taking process
so the customers are less interested to take part in the survey
• Information for the analysis was collected from the websites, research papers, study
materials.
• Geographic scope of the report is limited within Hyderabad market.
Methodology:
Two basic methods were used to achieve the required results;
Qualitative Analysis:
A less number of unstructured interviews were taken on some of the merchandisers and
customers to get proper insight on the buying behaviour of premium healthy food products.
Online Survey Questionnaire:
To know the customer insights on the premium healthy food products in their life, an online
survey questionnaire was designed.
Overview of the Data Collected and Used:
The study will be both a mixture of quantitative along with qualitative part. A basic overview
of the data collected and used to make this report are described below
Data Type: This report will be based both on Primary and Secondary data
Primary Source:
Primary data on social media is collected from surveying of target group and personal
observation.
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Secondary Source:
Like primary source, secondary source is also major stream of information for the report. List
of the secondary source is
1. Internet
2. Social Network Sites
3. Text books
4. And other sources
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Findings:
• Customer loyalty can be hard to come by these days , and in store promotions are an
important facet of building and developing that loyalty.
• We find that with an increase in customer loyalty comes an increase in revenue and
Brand Satisfaction.
• Customer purchase Decision
a) Over 60% of Purchase decisions are made at the shop Front.
b) 90% of consumers buy on IMPULSE.
• In some stores through sampling activities we observed the difference in the sales, the
store with a sampling activity have huge sales when compared to no sampling stores.
Conclusion:
• Marico has brand image but most of the customers are unaware about the healthy
gourmet category. So Marico has to improve its promotional activities to increase the
awareness on healthy gourmet products in order to increase the sales.
• Sampling of every product is required in every store especially for Saffola fifty
Gourmet.
• To sum it up all it is mandatory for business to conduct market research and understand
consumer perception to better position themselves in the competition and drive
increased customers and sales. With the help of a reliable market research services
providers such as research services, businesses can very well keep a track of their
business performance by monitoring influence of consumer perception.
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