Marketing

MBA Programme Part Time
XYZCo Chilled Diary Business Strategic Marketing Plan 2006-2008
Module Title: Marketing (N1DM04) Module Lecturer/Facilitator: John Zinkin
Group Assignment Submitted by: Chee Kok Wah (001380) Mohamed Rizal bin Rasool Khan (001384) Rupert Koh Hock Joo (001399) Ricki Lim Yit Kee (001405) Wong Shoon Hooi (001396) Date: 12 December 2005
Executive Summary
This paper is prepared as part of an MBA Marketing Module assignment for XYZCo Chilled Dairy Business Unit. The authors have taken the approach of presenting a strategic marketing plan instead of an academic paper, and have thus omitted a Bibliography Section. However, all references and sources are acknowledged and quoted either in the footnotes or in the main texts.
The plan is developed based on information gathered from:

Presentation and information provided by XYZCo Chilled Dairy Business Unit Presentation by XYZCo Factory XYZCo website and other web-based sources Survey of friends, families and relatives Publicly available information such as prices in hypermarkets and shops Academic journals and articles Certain reliable estimates from confidential sources
The plan is divided into 3 main sections: 1. A comprehensive business analysis section covering market, industry, competitive landscape, brand promise, TOWS (SWOT) and Customer Survey. 2. The strategic marketing plan covering strategic imperatives and communication strategy; two strategic initiatives proposed targeting a) Quick Service Restaurants (KFC, McDonalds) and Coffee Places (Starbucks, Coffee Bean), and b) Pre-schools subscription sales. Some suggestions on CSR initiatives, particularly the 3Rs Reduce, Reuse & Recycle are also presented. 3. The financial plan and major assumptions detailing the revenue, expenses and EBITA.
However, due to time constraints and limited availability of meaningful but sensitive financial and operational information, this report is not a true reflection of XYZCos chilled dairy business and should be used with caution. However, we believe that our assumptions and estimates are realistic, the survey information is insightful and the initiatives outlined are achievable. All this information would be of great use to XYZCo chilled dairy business unit in their business planning.
Table of contents
TABLE OF CONTENTS..................................................................................................................................................................... 3 1. INTRODUCTION ............................................................................................................................................................................ 4 2. BUSINESS ANALYSIS.................................................................................................................................................................... 5 2.1 MARKET ANALYSIS ......................................................................................................................................................................5 2.2 INDUSTRY ANALYSIS (PORTERS 5-FORCES)................................................................................................................................6 2.3 COMPETITOR ANALYSIS ................................................................................................................................................................7 2.4 BRAND PROMISE ANALYSIS .........................................................................................................................................................7 2.5 TOWS ANALYSIS .........................................................................................................................................................................8 2.6 CUSTOMER SURVEY ANALYSIS.....................................................................................................................................................9 3. STRATEGIC MARKETING PLAN........................................................................................................................................... 12 3.1 STRATEGIC IMPERATIVES ............................................................................................................................................................12 3.2 COMMUNICATION STRATEGY .....................................................................................................................................................13 3.3 STRATEGIC INITIATIVE 1: QUICK-SERVICE-RESTAURANTS (QSR) & COFFEE PLACES (CP) ...................................................15 3.4 STRATEGIC INITIATIVE 2: PRE-SCHOOLS (CHILDCARE CENTRES/KINDERGARTENS) ...............................................................17 3.5 CSR INITIATIVES .........................................................................................................................................................................19 4. FINANCIAL PLAN........................................................................................................................................................................ 20 4.1 SALES VOLUME PROJECTION......................................................................................................................................................20 4.2 INCOME PROJECTION ...................................................................................................................................................................21 4.3 MARKETING AND TRADE SUPPORT BUDGET ..............................................................................................................................21 5. CONCLUSION................................................................................................................................................................................ 22 APPENDICES ..................................................................................................................................................................................... 23 A. B. MARKET ANALYSIS..............................................................................................................................................................23 COMPETITIVE LANDSCAPE...................................................................................................................................................25 B.1 CMD Competitive Map...........................................................................................................................................25 B.2 Yogurt Drink Competitive Map ..............................................................................................................................26 B.3 Yogurt Cup/Tub Competitive Map .........................................................................................................................27 B.4 CMD price per gram comparison chart ................................................................................................................28 B.5 Yogurt Drink price per gram comparison chart....................................................................................................28 B.6 Yogurt cup/tub price per gram comparison chart .................................................................................................29 PESTLE ANALYSIS..............................................................................................................................................................30 CUSTOMER SURVEY QUESTIONNAIRE SAMPLE ..................................................................................................................31 CUSTOMER SURVEY QUESTIONNAIRE RESULTS .................................................................................................................33 E.1 All respondents ........................................................................................................................................................33 E.2 Respondents who know/dont know the difference between Y/YD and CMD......................................................35 CUSTOMER SURVEY ANALYSIS ...........................................................................................................................................37 PRE-SCHOOLS PROMOTIONAL ACTIVITIES ..........................................................................................................................41 SALES VOLUME AND REVENUE PROJECTION ......................................................................................................................42 H.1 Quick Service Restaurants......................................................................................................................................42 H.2 Coffee Places (Coffee Bean and Starbucks)..........................................................................................................42 H.3 Childcare Centres and Kindergartens...................................................................................................................43 H.4 Primary Schools......................................................................................................................................................43
C. D. E.
F. G. H.
1. Introduction
As the world's leading food company, XYZCo is dedicated to providing the best nourishment to people each day throughout their lives with its corporate motto of Good Food, Good Life1.
XYZCo Chilled Dairy Business Unit (CDBU) with its Yogurt products is currently a small contributor to overall group revenue (<2%)2 with a -5% EBITA3. However, Management understands the strategic importance of the CDBU as a value-adding business that will contribute strongly to the corporate positioning of consumer well-being.
The objective of this paper is to help XYZCo CDBU achieves its 2008 Vision: o EBITA : o Volume: From -5% to 5% From 6,500 => 15,000 Metric Tons (MT)
o Consumption: Daily by 2/3 of Malaysian urban households
The following key assumptions are made in the preparation of this paper due to insufficient data like historical data, financials, incentive schemes, operational constraints, etc.: 1. Focus on strategic marketing initiatives instead of operational and tactical issues.
Any income projection would not be meaningful without sufficient data. Thus, we have focus on top-line potential while bottom line figures were arrived by making intelligent assumptions.
2. CDBU growth rate assumed to be industrys growth rate based on past 5-years data4 as provided unless as stated otherwise. 3. No significant changes in operating environment and costs structure. 4. Sufficient capacity is available to produce the volume required without major capital investments.
1 2
www.XYZCo.com.my Assumption: Revenue at RM4-RM5 per kg multiplied by 6500MT (RM26M to RM32.5M) over XYZCos 2004 revenue of RM2.9B 3 XYZCos marketing brief 4 XYZCos marketing brief
2. Business Analysis
2.1 Market Analysis
Y ogurt 3%
Y ogurt 9%
Past Juices 41%
CMD 28%
Y ogurt Drink 17%
Y ogurt Drink 7%
CMD 74%
Past Milk 21%
Figure 1: Total Malaysian Chilled Market
Figure 2: Total Malaysian Chilled Market without pasteurized products
XYZCos present sales of 6,500MT represent a market share of only 10.8% despite the fact that XYZCo currently has a 42% and 63% market share in yogurt and yogurt drink respectively5. As such, it is imperative for XYZCo to participate in the CMD segment in order to grow its chilled dairy business; although technically, yogurt is in essence a cultured milk product albeit with higher nutritional value and count of active live cultures6. The launch of the 125g portion packs in 2004 was a step in the right direction to penetrate this relatively large and growing segment. Within the chilled liquid dairy segment7, Malaysia is growing about 4 times faster than Singapore with liquid cultured milk (includes yogurt drink) growing the fastest at 90% over 5 years or 18% p.a.8! This contrasts with existing growth rate of only 4% p.a. for yogurt9.
Total Malaysian Chilled Dairy Market (excl. pasteurised products)
80
Consumption '000 MT
54.3
60 40 20 0 2005 33.2 7.6 3.3 2006 2007 42.4
CMD Yogurt Drink Yogurt

9.8 3.4 2008 12.5 3.5 25.8 6.0 3.2
Figure 3: Market Projection
5 6
Refer to Appendix A Market Analysis for more details. National Yogurt Association <www.aboutyogurt.com>; University of Guelph <www.foodsci.uoguelph.ca/dairyedu/yogurt.html> 7 Includes white milk and flavoured milk 8 Our analysis based on slides 9 & 10 of XYZCos marketing brief 9 XYZCos marketing brief
There is also much room for growth in the urban Malaysia market as yogurt consumption is currently only 36% the consumption in Singapore while the urban Malaysia population is 4 times bigger than the entire Singapore population10!
C h ille d D a iry M a rk e t (e x c l. p a s te u ris e d p ro d u c ts)
Total consumption per urban population per annum (kg)
8 6 4
2 .1 2 .5 5 .9 6 .2 6 .5
6 .8
3 .8 3 .1
M a la ysia S in g a p o re
2 0 2005 2006 2007 2008
Figure 4: Consumption Projection11
2.2Industry Analysis (Porters 5-Forces)

Potential Entrants (LOW) - High entry barriers due to needs for expensive cold-chain logistics & distribution - High fixed costs for plant - Excess capacity in the market
Suppliers Power (MODERATE) - Nestle does not have the economies of scale however it has corporate advantage
Firms Rivalry (HIGH) - Few players - Very competitive - Most are making losses - Excess capacity - Minimal product differentiation
Buyers Power (HIGH) - Consumer - Low consumption of Yogurt - High consumer power due to low switching cost - Elastic demand - Hypermarkets - Few big players - High buyer power - Hold pricing power
Threats of Substitutes (HIGH) - Very low switching costs - Many consumption alternatives - Soft drinks - Fruit juices - Coffee & Tea, etc.
Figure 5: Porter's 5-Forces Analysis
Yogurt business is still relatively young12 in Malaysia. The major challenges facing the industry now are intense competition and excess capacity13 chasing after a very small consumer market with low awareness; and faces very low switching costs due to the abundance of many consumption alternatives. Compounding the problem is the concentration of pricing power in the hands of the few large hypermarkets and supermarkets chains.
10 11
Assuming the urban Malaysia population is 64% of 26 million and Singapore population at 4 million Based on our country consumption projections (Section 4.1) and assuming the urban population comprises 64% and 100% of the population in Malaysia and Singapore respectively, and a population growth of 3% and 1.7% p.a. respectively 12 Based on the low Yogurt consumption of 0.88kg per Malaysian per year (eqv to 6 cups of 150g) versus 1.22kg in Singapore 13 XYZCos marketing brief
2.3 Competitor Analysis From the various competitive maps in Appendix B, it can be seen that direct competition is the greatest in the Yogurt category which attracts imported brands as well. There exists moderate competition in the Yogurt drink and CMD categories. However, in the Yogurt drink category, competition also comes from substitutes like fruit juices and milk drinks. The major competitive brands in all 3 categories are Marigold/Vitagen, Dutch Lady/Moojooz, Nutrigen/Liteyo, Anlene/Solivite, Sunglo/Lassi and Yakult (only in CMD).
XYZCo price positioning is typically in the mid-range for all 3 categories except its Premium range which is the most expensive (on a per gram basis) for a locally produced yogurt. The priceleaders are Anlene, Dutch Lady and Marigold in Yogurt, Sunglo in Yogurt drinks, Nutrigen and Solivite in CMD categories. Yakult commands a premium in the CMD category. 2.4 Brand Promise Analysis
Function 1. Common man nutritious consumption - Everyday Pleasure (Low Fat Y/Drink) 2. Children well-being Nespray Yogurt 3. Adult well-being Nesvita (Fat free, Premium, Natural) 4. Children health snacks (Minipacks) Brand Promise 5. SOCIAL, FUN, HIP & NUTRITIOUS DRINK Differentiation 1. Nestle brand 2. Fresh & colourful packaging 3. PERSONALITY IDENTIFICATION & ATTACHMENT
Personality 1. Sincerity: Down-to-earth, Honest, Wholesome (Low Fat Y/Drink) 2. Competence: Reliable, Intelligent, Successful (Nespray Yogurt) 3. Sophistication: Upper class, charming, wealthy (Premium Yogurt) 4. EXCITEMENT: SPIRITED, YOUNG, IMAGINITIVE, TRENDY
Source of Authority 1. Reputable & Trusted Global Brand 2. Market leadership
Figure 6: Brand Promise Analysis
The Brand Promise framework analysis exposes opportunity gaps/potentials which XYZCo can tap-on to further grow its market leadership position. XYZCo has the opportunity to position its Yogurt products as a Social, Fun, Hip and Nutritious drink to its key communication target segment of the 20-30 year old urbanites earning RM2500 and above monthly. To appeal to this customer segment, the Brand Personality14 has to project Excitement Spirited, Young, Imaginative and Trendy! Through the careful, meticulous design and experience of its Brand Promise, XYZCo should be able to create stronger brand differentiation based on Personality
14
Defined as the set of human characteristics associated with a brand by Jennifer Aaker, 1997 in Dimensions of Brand Personality, Journal of Marketing Research, p347-356.
Identification and Emotional Attachment, thereby elevating itself from competing on price. A good channel to develop and carry this new Brand Promise Extension is to work on new product category creation (E.g. Ice-Blended Yogurt Drink) and co-branding initiatives (E.g. Joint promotions & merchandising) with the likes of Starbucks and Coffee Bean outlets. 2.5 TOWS Analysis
External Environmental Analysis (PESTLE, Porters 5-Forces)
THREATS WEAKNESSES
OPPORTUNITIES STRENGTHS
Internal Environmental Analysis (Brand Promise, McKinseys 7S)
Figure 7: TOWS Analysis Framework
Consolidating the above analyses using the above framework15 identified the following major Threats, Opportunities, Weaknesses and Strengths.
Threats 1. Intense competition & industry excess capacity put downward pressure on price 2. Cautious consumer spending due to slowing economy & rising inflation 3. Competitors may seize consumer mindshare by not adhering strictly to advertising & labeling guidelines 4. Hypermarkets have pricing power and may influence sales 5. Low consumer awareness & consumption Weaknesses 1. Poor ROI (Profitability) due to diseconomies of scale 2. Limited distribution (HyperMarkets & Supermarkets) and product range compared to Marigold, F&N 3. Lack meaningful differentiation 4. Poor sales visibility (not daily/weekly) 5. Possible morale issue -> Uncertain future Opportunities 1. Growth market due to growing affluence and changing lifestyle 2. Establish long-term brand leadership through strategic channels development and awareness program (Starbucks, KFC, Kindergarten/Childcare, etc.) 3. Creation of new product range to appeal to various sub-segments (Healthy Living, Convenience, Lifestyle Drink) 4. Establish CSR leadership through the 3Rs Reduce, Reuse, Recycle Strengths 1. Strong corporate brand (Nestl) and sister brands (Milo, Nescafe, Maggi, etc.) 2. Cross-brands leverage a. Product extension b. Sales & Distribution 3. Cost leadership 4. Strong financial position
Figure 8: TOWS Analysis
These serve as the foundation in the formulation of our strategic marketing plan to achieve the 2008 vision. Please refer to Appendix C for more details on PESTLE analysis.
15
The McKinsey 7S alignment analysis was not performed due to insufficient and/or confidential information relating to XYZCo Chilled Dairy Business Unit. However, we recommend that XYZCo performed its own analysis to identify any gaps or misalignments to ensure smooth strategy execution.
2.6 Customer Survey Analysis A questionnaire-based survey was conducted with 108 responses. A sample questionnaire can be found in Appendix D. The full survey results and analysis can be found in Appendix E and F.
Perception of Y/YD/CMD to be nutritious Which is perceived to be more nutritious Consume or Not What they consume Y/YD 32 (55.1%) consume 58 (87.9%) CMD 11 (19%) Both 15 (25.9%) don't consume 8 (12.1%) Y/YD 5 (27.8%) consume 18 (90%) CMD 7 (38.9%) Both 6 (33.3%) don't consume 2 (10%) Y/YD 1 (20%) consume 5 (100%) 108 Respondent Both 5 (5.5%) don't consume 0 (0%) Y/YD 2 (20%) consume 10 (58.8%) CMD 6 (60%) Both 2 (20%) don't consume 7 (41.2%) Y/YD 1.9% CMD 5.5% Both 1.9% Non-consumer 15.8% CMD 0 (0%) Both 4 (80%) Y/YD 0.9% CMD 0.0% Both 3.7% Y/YD 4.6% CMD 6.5% Both 5.6% Effective Consumption Y/YD 29.6% CMD 10.2% Both 13.9%
Y/YD 66 (72.5%)
nutritious 91 (84.3%)
CMD 20 (22%)
not nutritious 17 (15.7%)
Figure 9: Perception versus Consumption
The survey revealed that perceived nutritional value will lead to higher consumption. For example, for respondents who consume Y/YD and CMD exclusively, the effective Y/YD consumption amongst those who perceive Y/YD and CMD to be more nutritious are 29.6% and 6.5% respectively. Effective exclusive Y/YD and CMD consumption across all respondents are 37% and 22.2% respectively while those that consume both is 25.1%. For those who perceived that neither Y/YD nor CMD are beneficial, they would likely consume CMD. Thus, it is crucial that the public is educated on the health benefits of Y/YD to acquire more customers.
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Preferred Brands
25.0% 20.0% 15.0% 10.0% 5.0% 0.0% Of the 108 respondents, the brand they consume are Nestle Moojooz Dutch Lady Vitagen Yoplait No preference Yakult Marigold Others Nutrigen Anlene Solivite Sunglo
Figure 10: Brands Preference
XYZCo, at 23%, is the preferred brand among all respondents with Vitagen being a close second. Similarly, XYZCo (24%) and Vitagen (22%) are also the preferred brands among those who knew the difference between Y/YD and CMD. However, Vitagen (23%) is marginally more popular than XYZCo (22%) among those who didnt know the difference. Therefore, this again reiterates the need to make aware the presence and benefits of Y/YD. Yakult, although a relatively new entrant to the market has gained significant mind share with 10% preferring Yakult.
Preferred certain brands because of

35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 1 Trusted brand Price Taste New flavour Availability Recommended Packaging Gifts
Figure 11: Brand Selection Criteria
The top 3 factors of Y/YD consumption are nutritional value (27.5%), good tastes (16.1%) and high-calcium content (10.7%).
10
A huge 68.5% of the respondents would consume Y/YD if offered in places like Starbucks, Coffee Bean, KFC, and McDonalds. A substantial amount (approximately RM300 per family) is being spent at these outlets monthly.
80% of respondents (parents and future parents) are willing to subscribe their children to daily yogurt consumption in pre-schools! Capturing the children while they are young ensure longterm brand affinity and loyalty as proven with the successful strategy of Milo.
Ingredients in which respondents are looking for in Y/YD/CMD

25.0% 20.0% 15.0% 10.0% 5.0% 0.0% Of the 108 respondents, the ingredients that they were looking for in Y/YD/CMD are Milo-flavoured Honey-flavoured Vitamins enhanced Caramel-flavoured Low fat DHA enhanced Vanilla-flavoured High calcium Iron enhanced Coffee-flavoured Energy plus Tongkat Ali enhanced
Figure 12: Ingredients Preferences
Product line extension initiatives such as Milo-flavoured Y/YD (7.3%), honey-flavoured (2.8%) or vitamins-enhanced Y/YD did not receive a gratifying respond. Thus, product line extension will not be pursued in this marketing plan.
Similarly, the initiative to tap the home delivery channel was not well-received (34.0%) and a huge 87.5% were reluctant to pay more for the higher delivery cost. The fact that many working adults would not be home to pick up a fresh bottle of Y/YD dampens the expansion of this channel.
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3. Strategic Marketing Plan

3.1 Strategic Imperatives XYZCos CDBU strategic marketing plan has to consider the following imperatives:
1. Increase sales volume to gain economies of scale Achieving economies of scale is critical to improving the bottom-line and XYZCo has to explore non-traditional channels like the KFC, McDonalds, Starbucks, Coffee Bean, Childcare Centres and Kindergartens, Schools, etc.
2. Create meaningful brand differentiation and affinity for long-term positioning Being a relatively young industry with little technological differentiation, XYZCo has to create meaningful brand differentiation beyond product differentiation through brand personality and affinity development.
One strategy proposed is to educate, cultivate and develop the consumers while they are still young through kindergarten and school initiatives as has been proven successful by XYZCo in promoting Milo before.
We also propose the development of a family mascot that exhibits the various brand personalities for use in various awareness-building, educations, promotions and communications initiatives targeting the various customer segments.
Differentiation through CSR leadership is also important to build long-term customer equity.
3. Extend product positioning to cover various segments XYZCo has to tap into the largest CMD market segment in order to grow its market share and the launch of the 5-minipacks yogurt drink is a step in the right direction. Another key segment is the young and trendy segment as identified in Section 2.4. Product extensions should also be considered.
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3.2 Communication Strategy The communication strategy should achieve the following objectives: a) Create brand and product awareness b) Educate the market on the health benefits of yogurt consumption c) Instill brand personality identification and emotional attachment
a) Create brand and product awareness The lack of awareness as revealed in our survey equate to the need to instill the sense of basic knowledge to potential consumers as well as to further educate current consumers on certain misconception of yogurt. According to Best, if target consumers are unaware of a product and its benefits, cost, and value, there is little opportunity for purchase, and inevitably, awareness is the first step to new-customer acquisition.16
b) Educate the market on yogurt health benefits Due to strict local regulations governing labeling and advertising of food products, nutrition claims are limited to a list of permitted functional claims and strictly rules out any forms of health claims17. This places much constraint on XYZCo in its advertising and communication activities. However, we can educate the market through the use mediums such as VCDs, recipe books, educational books18, etc. which allow longer attention-span by relating to cultural practices and norms (E.g. Why Indians consume yogurt and the various forms of consumption such as Lassi) and relating to various research findings which support as well as dispute the health benefits of yogurt, etc19.
c) Instill brand personality identification and emotional attachment For a brand to be distinct and enduring, it must evoke emotional attachment through personality identification in its target consumers20. Therefore, we propose the use of a family mascot as shown below that exhibits the various brand personalities to promote recognition (short-term) and establish loyalty (long term) for use in various awareness-building, educations, promotions and communications initiatives targeting the various customer segments.
16 17
Best R. J., Market Based Management: Strategies for Growing Customer Value and Profitability, Prentice Hall, pp303. Source: www.nutriweb.org.my. For more details, please refer to Section C PESTLE Analysis. 18 Discussed in more details in Section 3.4 Strategic Initiative 2: Pre-schools (Childcare Centres/Kindergartens) 19 A lot of useful and educational information relating to yogurt consumption can be found at National Yogurt Association (www.aboutyogurt.com) 20 Jennifer Aaker, 1997. Dimensions of Brand Personality, Journal of Marketing Research, p347-356
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Brand Personality
Competence
Personality Traits
Reliable Intelligent Successful Upper Class Charming Daring Spirited Imaginative Up-to-date Down to earth Honest Wholesome Cheerful
Identity
Mom
Product
Nespray Yogurt
Sophistication
Teenage Daughter
Yogurt Premium
Excitement
Teenage Son
Yogurt Drink
Sincerity
Dad Baby
Low Fat Yogurt Yogurt Drink
Figure 13: Product & Brand Personality Communication
Figure 14: Family Mascots Sample
For example, commercials showing a mother deliberating and deciding on Nespray Yogurt over the common low-fat yogurt for their children are communicating competence while that of a teenage daughter choosing Premium Yogurt are communicating sophistication. With this in mind, communicating the brand personality to the targeted segment necessitates the selection of the right the communication media/platform. We propose the following:
Channels
Pre-Schools
Brand Personality Focus

Children ~ Excitement ~ Sincerity
Communication Media / Platform

Educational CDs/VCDs Kiddies Club Activities/Programmes Calendar Kindergarten Teaching Materials Activity and exercise books, posters etc. Mascot-themed stationeries, bags, lunchboxes etc. Miscellaneous premiums - stickers, bookmarks, fridge magnets etc. Magazines (Kuntum etc) Monthly/Quarterly Newsletters on Kiddies Club Activities Parents Magazine on health (relating to Nestle products) Events and promotions at local supermarkets/hypermarkets Radio (Mix FM, 98.8, RM KL etc) Magazines (Wanita, Keluarga, Young Parents, etc) Radio (Hitz FM, 98.8 etc) Magazines (Cleo, FHM, Female, Galaxie etc) Joint-promotion with Bonuslink, Real Rewards on points redemption Joint-promotion with cinema, bowling centres, fitness centres, beauty salon Miscellaneous premiums - coasters, bumper stickers, mugs etc. Contests - scratch & win
Parents ~ Competence ~ Sophistication
QSR & CP
Teenagers to Working Adults ~ Excitement ~ Sophistication
Figure 15: Brand Personality and Communication Media 14
3.3 Strategic Initiative 1: Quick-Service-Restaurants (QSR) & Coffee Places (CP) Our survey revealed a resounding 69% of respondents would consume yogurt blended/mixture drinks in QSR or CP.
Objectives As consumers become more educated and conscious about their health and well-being, they are more demanding with the quality of their food. Recognizing this, QSR are also moving into the directions of promoting healthier food such as salads, etc. There is thus synergy in approaching QSR and CP to offer yogurt as part of their menu.
The primary objective is to increase sales volume with a projected yogurt volume of 3,195MT by 200821. The secondary objective is to build long-term brand awareness by establishing a widespread brand presence in QSR and CP outlets supported by Point-of-Sale Materials (POSM), joint-promotions and marketing activities.
Product and Branding With QSR, XYZCo may be able to promote its existing range of XYZCo-branded products and/or co-branded products in different packaging. The existing products that can be positioned are: i. 150g cup yogurt promoted as desserts in the value meals or healthy salads menu, etc. ii. 125ml yogurt drink promoted in the kiddies meals. iii. 300ml yogurt drink promoted as healthy substitutes for orange juices and soft drinks
With CP, the in-house brands of Starbucks and Coffee Bean may limit the exposure of the XYZCo brand as they hardly sell ready-mix beverages. However, we feel that through strategic tie-up and joint promotions, co-branding activities may be carried out to make the XYZCo brand presence felt. Customized product offering may need to be developed by both the CP (E.g. Ice-blended Yogurt Drink) and XYZCo (E.g. Large packing of tub yogurt or yogurt drink, special flavours, ingredients, etc.).
However, if the primary objective is to increase sales volume to achieve economies of scale, private-labeling may be a worthwhile consideration in the short to mid-term if co-branding is not feasible.
21
Refer to Appendix H Sales Volume and Revenue Projection for details.
15
Price QSR and CP enjoy good margins from beverages which are normally priced at a premium above retail prices. In order to capture these channels, XYZCo has to offer competitive pricing. We assumed that when compared to the retail trade which makes a gross margin of 10%, QSR may need to make about 20% gross margin. This means that XYZCo gross margin will be lower but this will be offset by the higher sales volume.
Place The target is to have yogurt products available at all these QSR and CP outlets, particularly KFC as it is the leading fast-food chain in Malaysia. Furthermore, XYZCo is already supplying Milo, ice-cream, etc. to KFC. As most of these outlets are located in urban areas, the promotion/sales of yogurt products will serve as a vehicle for XYZCo to reach out to its target of the large urban adult population segment. Moreover, these outlets are well managed and have the facilities to handle yogurt products which are sensitive to the physical environment.
Promotion Some joint promotional activities which can be adopted to build awareness and increase Y/YD sales are: i. Coupons/Vouchers redemption to stimulate initial awareness and demand. ii. Bundling and purchase-with-purchase promotions to stimulate consistent and continuous demand. iii. Joint marketing campaigns to share A&P costs. iv. Discount vouchers for other XYZCo products to promote cross-selling. v. Merchandises bearing the family mascot characters such as torch lights, piggy banks, pencil cases, toys, etc. which also serve as additional advertising media.
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3.4 Strategic Initiative 2: Pre-schools (Childcare Centres/Kindergartens) Our survey revealed a resounding 80% of respondents (parents and future parents) are willing to subscribe their children to daily yogurt consumption in pre-schools! Objectives With this initiative, XYZCo will be able to reach children between 3 to 6 years old; building early awareness and educating them of the goodness/benefits of yogurt consumption; and nurturing long-term loyalty to the XYZCo brand22. Through subscription-based selling, XYZCo is guaranteed of constant and predictable demand and high growth potential as these young consumers grow up on XYZCo yogurt. There are approximately 5,100 pre-schools in Malaysia, majority are located in urban areas. Assuming between 10% and 20% of pre-schools will buy-in to this initiative, and a 75% children subscription rate, the projected sales volume is 2,884MT by 200823.
Product and Branding The XYZCo branded 5x125g portion packs is recommended as young children can easily consume a 125g bottle daily (Monday to Friday) and tap into the huge CMD segment as identified earlier. Additionally, the 300ml and 750ml yogurt drink may be subscribed to by parents and teachers under a family subscription program as an extension of this initiative.
XYZCo may want to consider special packaging to differentiate these products to prevent crossovers to the general retail trade.
Price All products will be retailed at the recommended retail price. However, in order to get buy-in, preschools operators will be given the normal retail margin. An additional 5% to 10% margin is budgeted to cover logistics/delivery costs.
Sharon Beder, A Community View, Caring for Children in the Media Age, Papers from a national conference, edited by John Squires and Tracy Newlands, New College Institute for Values Research, Sydney, 1998, pp. 101-111, http://www.uow.edu.au/arts/sts/sbeder/children.html 23 Refer to Appendix H Sales Volume and Revenue Projection for details.
22
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Place Pre-schools in major urban areas are our primary target as our informal survey indicated that most of them have refrigerators, which is required to maintain the goodness and benefits of yogurt/yogurt drink. We recommend direct van sales on a weekly/fortnightly schedule depending on locations and subscriptions.
Promotion By covering the younger consumer market and parents with purchasing power, XYZCo contact with consumers covers both ends of the demand chain.
To create brand recognition and differentiation, educational materials created in a fun and exciting24 manner (E.g. Educational VCDs featuring family mascots similar to Barney and Friends, Sesame Street, etc.) are given out to subscribing children. The contents could cover:
General knowledge The human digestive system, yogurt and its benefits, recycling and environmental effects, etc.
Specific knowledge XYZCo yogurt-making process, XYZCo yogurt-cooking recipe, XYZCo initiatives in the 3Rs (Reduce, Reuse, Recycle), etc.
These education materials will be refreshed quarterly to continuously inject excitement and attraction while reinforcing brand awareness. Premium items such as stationery (ruler, pencil cases, etc.) featuring the family mascots could be bundled with the products to promote brand loyalty and avoid price competition.
The following promotional activities are discussed in more details in Appendix G:

Creation of a Kiddies Club. Educational materials - VCDs, game CDs and exercise and activity books. Miscellaneous promotional activities such as mascots creation contests, colouring activities, music and drama, etc.
24
Projecting the brand personality of EXCITEMENT as detailed in Section 2.4 and 3.2.
18
3.5 CSR Initiatives XYZCo, being a reputable and socially responsible MNC should continue to take the lead in the 3Rs (Reduce, Reuse & Recycle) initiative to maximize its license to operate and build long-term goodwill with government and society at large.
Specifically, we suggest that slight changes be made to the Yogurt drink packaging for 300ml and 750ml to encourage reuse as follows: o Screw-on cap to allow ease of opening and re-capping. o Smaller base to fit into vehicles drink holder. o Translucent material with volume markings for ease of use. o Bottle straps for school-going children. o Wrappable design sheets on bottles to encourage creativity and personalization (similar to phone covers concept).
To encourage recycling, pre-schools children can be educated through the educational materials and programs being developed in Section 3, supported by contests and awards recognition.
19
4. Financial Plan
4.1 Sales Volume Projection
3-year sales volume & market share projection

Sales Volume (Metric Ton) Yogurt @ 4% annual growth Yogurt drink (market growth @ 18%) Yogurt drink (strategic initiatives) - QSR - Coffee Places - Pre-school sales TOTAL (exclude Primary Schools) - Primary school sales TOTAL (include Primary Schools)* For Info Only 2005 1,625 4,875 2006 1,690 5,753 971 38 810 9,261 2,808 12,069 2007 1,758 6,788 2,008 54 1,688 12,296 5,688 17,984 2008 1,828 8,010 3,113 82 2,884 15,917 8,640 24,557
6,500
- Malaysia @ 28% annual growth - Singapore @ 7% annual growth TOTAL Addressable Market (MT) Market Share (excl Primary Schools) Market Share (incl Primary Schools)* For Info Only
35,000 25,350 60,350 10.8%
44,800 27,125 71,925 12.9% 16.8%
57,344 29,023 86,367 14.2% 20.8%
73,400 31,055 104,455 15.2% 23.5%
Assuming that CDBU grows in line with the market as discussed in Section 2.1 (Yogurt at 4% and Yogurt drink at 18% annually), the shortfall from the targeted 15,000MT in 2008 can be more than made-up through sales to QSR and pre-schools as covered in Section 3 . CDBU should be able to over achieve its 2008 target with a volume of 15,917MT excluding sales to primary schools to garner a 15.2% market share. A more aggressive marketing plan which includes sales to primary schools would yield a total volume of 24,557MT and a 23.5% market share in 2008. However, we have taken a more conservative approach and not included the primary schools market in this plan. Please refer to Appendix H for details.
20
4.2 Income Projection
3-year Income projection (RM '000)

Sales Revenue @ RM4.50 per kg Yogurt @ 4% annual growth Yogurt drink (market growth @ 18%) Yogurt drink (strategic initiatives) - QSR - Coffee Places - Pre-school sales TOTAL (exclude Primary Schools) $ $ 2005 7,313 21,938 $ $ $ $ $ $ 2006 7,605 25,886 4,368 169 3,645 41,673 $ $ $ $ $ $ 2007 7,909 30,546 9,038 241 7,598 55,331 $ $ $ $ $ $ 2008 8,226 36,044 14,010 370 12,976 71,626
29,250
COGS FC @ 10% p.a. growth VC VC/kg @ 3% p.a. growth Gross Margin FG&A @ 20% p.a. growth A&P @ 10% of Revenue EBITA '000
$ $ $ $ $ $ $ $
21,938 75% $ 6,581 30% $ 15,356 70% $ 2.36 $ 7,313 5,850 2,925 (1,463) 25% $ 20% $ 10% $ -5% $
29,774 7,239 22,535 2.43 11,899 7,020 4,167 712
71% $ 24% $ 76% $ $ 29% $ 17% $ 10% $ 2% $
38,781 70% $ 7,963 21% $ 30,818 79% $ 2.51 $ 16,550 8,424 5,533 2,593 30% $ 15% $ 10% $ 5% $
49,850 70% 8,760 18% 41,091 82% 2.58 21,776 10,109 7,163 4,504 30% 14% 10% 6%
Based on the following assumptions, CDBU should be able to achieve a 6% EBITA, which is just slightly ahead of its 2008 target:

Blended sales revenue @ RM4.50 per kg Fixed Costs (30% of COGS) increase @ 10% p.a. Variable Costs (70% of COGS) increase @ 3% p.a. due to inflation FG&A (which includes trade support fund) increase @ 20% p.a. A&P budgeted at 10% of forecasted revenue
4.3 Marketing and Trade Support Budget To support our strategic initiatives outlined above, an initial marketing and trade support funds of RM5 million each is proposed as follows for 2006:
Marketing Fund (RM5 million) TVC Newspapers Magazines Radio Point-of-Sale Trade Support (RM5 million) Educational VCDs Creative Production Educational VCDs Packaging Production @ RM2 each for 100,000 pieces Activity books Creative Production Activity books Printing Production @ RM5 each for 100,000 copies Sponsorship of pre-school events/contests, etc. Trade promotions/incentives, etc. Premiums/Mascots @ RM5 each for 200,000 pieces Allocation 40% 10% 10% 10% 30% Allocation 5% 4% 3% 10% 40% 18% 20% RM 2,000,000 500,000 500,000 500,000 1,500,000 RM 250,000 200,000 150,000 500,000 2,000,000 900,000 1,000,000
21
5. Conclusion
Based on market and industry analyses, and the implementation of strategic initiatives beyond the traditional retail trade, our strategic marketing plan indicates that the goals espoused in CDBUs vision 2008 are achievable. Current EBITA Metric Tons Daily consumption by urban household -5% 6,500 N.A. Vision 2008 5% 15,000 2/3 Our Projections 6% 15,917 Difficult to ascertain
Our plan goes beyond Vision 2008 by building the foundation for long-term brand loyalty while providing for consistent and predictable subscription-based revenue, and connecting with the young and trendy segment. Our proposed CSR initiatives also endear XYZCo to the public and continue to uphold its trusted and reputable brand.
22
Appendices
A. Market Analysis
Y ogurt 3%
Y ogurt 9%
Past Juices 41%
CMD 28%
Y ogurt Drink 17%
Y ogurt Drink 7%
CMD 74%
Past Milk 21%
Figure 16: Total Malaysian Chilled Market
Figure 17: Total Malaysian Chilled Market without pasteurized products
The total chilled market presently comprises of pasteurized juices (41%), cultured milk drinks (CMD) (28%), pasteurized milk (21%), yogurt drink (7%) and yogurt (3%) with a total consumption in Malaysia of approximately 90,000MT25. XYZCos chilled dairy business
however excludes pasteurized products which confines its addressable market size in Malaysia to approximately 35,000MT made up of CMD (74%), yogurt drink (17%) and yogurt (9%). The Malaysian market represents 58% of the relevant Malaysia and Singapore chilled markets26 which mean the Singapore market is estimated to be 25,350MT (42%) and the combined market to be 60,350MT.
XYZCos present sales of 6,500MT (out of 60,350MT) represent a market share of only 10.8% despite the fact that XYZCo currently has a 42% and 63% market share in yogurt and yogurt drink respectively. As such, it is imperative for XYZCo to participate in the CMD segment in order to grow its chilled dairy business; although technically, yogurt drink is in essence a cultured milk product27 albeit with higher nutritional value and count of active live cultures. The launch of the 125g Yogurt drink portion packs in 2004 was a step in the right direction to penetrate this relatively large and growing segment28.
XYZCos marketing brief Based on data provided in slides 10 and 8 of the Marketing brief and taking the Malaysian dairy consumption as a proportion of total relevant Malaysia and Singapore dairy consumption. 27 National Yogurt Association <www.aboutyogurt.com>; University of Guelph <www.foodsci.uoguelph.ca/dairyedu/yogurt.html> 28 Although family packs have grown by 275% over the 5 year period to 2004 compared to 79% for portion, this could be due to lower base of family packs. Further, portion packs command 88% of the volume vs 12% from family packs.
26
25
23
The shifting trend in liquid package beverages from ambient to chilled is expected to continue as evidenced by the combined Malaysian and Singapore chilled market growth of 59% versus ambient growth of 39% over 5 years to 200429. Within the chilled liquid dairy segment30, Malaysia is growing about 4 times faster than Singapore (21% p.a. versus 4.8% p.a.) with liquid cultured milk (includes yogurt drink) growing the fastest at 90% over 5 years or 18% p.a.31! This contrasts with existing growth rate of only 4% p.a. for yogurt32. Further analysis yields the following market projection33.
Total Malaysian Chilled Dairy Market (excl. pasteurised products)
Consumption '000 MT
80 60 40 20 0 33.2 7.6 3.3 2006 2007 42.4
54.3
CMD Yogurt Drink Yogurt

9.8 3.4 2008 12.5 3.5 25.8 6.0 3.2 2005
Figure 18: Chilled Dairy Market Size Projection
There is also much room for growth in the urban Malaysia market as yogurt consumption is currently only 36% the consumption in Singapore while the urban Malaysia population is 4 times bigger than the entire Singapore population34!
C h ille d D a iry M a rk e t (e x c l. p a s te u ris e d p ro d u c ts)
Total consumption per urban population per annum (kg)
8 6 4
2 .1 2 .5 5 .9 6 .2 6 .5
6 .8
3 .8 3 .1
M a la ysia S in g a p o re
2 0 2005 2006 2007 2008
Figure 19: Consumption Projection35
29 30
Total chilled market grew by 90% in Malaysia and 31% in Singapore over the 5 year period to 2004. Includes white milk and flavoured milk 31 Our analysis based on slides 9 & 10 of XYZCos marketing brief 32 XYZCos marketing brief 33 Please refer to the Financial Plan in Section 4 for details 34 Assuming the urban Malaysia population is 64% of 26 million and Singapore population at 4 million 35 Based on our country consumption projections (Section 4.1) and assuming the urban population comprises 64% and 100% of the population in Malaysia and Singapore respectively, and a population growth of 3% and 1.7% p.a. respectively
24
CMD Competitive Map
$4.00 Yakult, $3.89 Vitagen, $3.79 Nutrigen IQ 3, $3.69 Mr Lacto, $3.60 Nestle Portion, $3.49 Moojooz, $3.39 Solivite, $3.29
B.1 CMD Competitive Map
B. Competitive Landscape
$3.50
$3.00
Price ($)
Nutrigen, $2.99
$2.50 400 500 Size (ml) 600 700 800
300
25
Yogurt Drink Competitive Map
$5.00
$4.50 Nestle Family Pack Yoplait (750ml) Nestle Portion Pack Carrefour Nutrigen Liteyo
Sunglo Lassi Marigold
$4.00
B.2 Yogurt Drink Competitive Map
$3.50
$3.00 Sunglo Diet Lassi
Price ($)
$2.50 Nestle 300mlPack
$2.00
$1.50
Yoplait (200ml)
$1.00
$0.50
$300 400 500 Size (ml) 600 700 800 900 1000 1100
100
200
26
Yogurt Competitive Map

Yoplait Strawbery Low Fat (Imported) Ski Divine Full Cream Tub (Imported) Yoplait Fruit Low Fat (Imported) Yoplait Go-Gurt Tubes (Imported) Ski Divine Vanilla Tub (Imported) Petit Suisse Chocolate (Imported) Pauls Vanilla Yogurt Tub (Imported)
$20.00
$17.50
$15.00 Yoplait Petit Miam (Imported) Petit Suisse Natural (Imported)
B.3 Yogurt Cup/Tub Competitive Map
Pauls Natural Tub (Imported)
$12.50 Petit Suisse Fruit Flavoured (Imported)
Price ($)
$10.00
$7.50 Nestle Fruit Flavoured Tub
Ski Double Up Cup (Imported)
Nestle Natural Flavoured Tub Sunglo Yogurt Tub
Ski D'lite Cup (Imported) $5.00
Ski Divine Cup (Imported)
Elle & Vire Fruit Cup (Imported)
Elle & Vire Natural Cup (Imported)
Dairy Farmers Cup
$2.50
Nespray Yogurt Nestle Premium And Extra Creamy Cup Nestle Low Fat / Hi Cal Cup Marigold Normal Cup Dutch Lady Cup Nutrigen Lite Yo Cup Anlene Hi Cal / Low Fat Cup Marigold Fat Free Cup Gooday Cup 300 400 500
$-
100
200
Weight (g) 600
700
800
900
1000
1100
27
B.4 CMD price per gram comparison chart

CMD price per gram comparison chart
$0.012
$0.010
$0.008 Price per gram
$0.006
$0.004
$0.002
$Yakult Nutrigen Nutrigen IQ 3 Solivite Moojooz Vitagen Mr Lacto
B.5 Yogurt Drink price per gram comparison chart

Yogurt Drink price per gram comparison chart
$0.0090
$0.0080
$0.0070
$0.0060 Price per gram
$0.0050
$0.0040
$0.0030
$0.0020
$0.0010
$Nestle Portion Pack Nestle Nestle Family 300mlPack Pack Nutrigen Liteyo Yoplait (750ml) Yoplait (200ml) Sunglo Diet Sunglo Lassi Lassi Marigold Carrefour
28
Yogurt Price per gram (g)
$0.080
$0.070
$0.060
$0.050
Price per gram (g)
$0.040
$0.030
B.6 Yogurt cup/tub price per gram comparison chart
$0.020
$0.010
$-
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Tu
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up
29
C. PESTLE Analysis
Political Factors
Stable political system in Malaysia with a strong coalition party in power since independence in 1957 Political will on improving efficiency of public delivery system, transparency and competitiveness (Source: Budget 2006)
Implications
- Predictable business environment for mid- to long-term planning - Reduce cost of doing business (E.g. Group relief provisions, Tax deductions on Audit fees, etc.) - Speed up new product launches, etc.
D.
Economical Factors
Economy expected to slow down from 7.1% in 2004 to 5% in 2005 and 5.5% in 2006 due to slower world growth and high prices of oil (Source: Department of Statistics, Budget 2006 Speech) Expected rise in interest rates in 2006 (Source: The Star, 22 Nov 2005)
Implications
- Cautious consumer spending on discretionary items such as Yogurt - Reduced purchasing power as inflation rose to 2.9% (as of Oct 2005) from 1.4% (2004) - Increased cost of doing business as any rise in interest rates will affect the whole supply chain
Social-Cultural Factors
Multi-Ethnic society consisting of Malays, Chinese, Indians, etc. Rapid urbanisation, increased affluence and sophistication of consumers, and smaller households (Source: Budget 2006, Department of Statistics)
Implications
- Differing tastes (Fragmented taste buds) and consumption patterns - Increasing demand for snacks, on-the-go packaging, convenience and quality of food & beverages products - Increased affordability and willingness to spend for healthy alternatives & healthy lifestyle - Increasing awareness and support for companies with good CSR practises - Potential new channels and styles of consuming Yogurt and Yogurt blended beverages - Lack of value perception and awareness
Growing number of coffee places, fast-food outlets and al-fresco dining Low yogurt consumption (except Indians)
Technological Factors
Minimal technological differentiation in Yogurt/CMD products and the live culture used except for Yakult (patented process & culture)
Implications
- Difficult to create meaningful product differentiation
Legal Factors
Malaysia has one of the most stringent set of laws governing food-related products, particularly the dairy product segments to ensure consumer protection (Source: www.nutriweb.org.my) Nutrition claims are limited to a list of permitted functional claims and strictly rules out any forms of health claims (Source: www.nutriweb.org.my) Law enforcement still has much room for improvement
Implications
- Compliance with all regulatory requirements means longer time to market, particularly for new products launches
- Nestl, being a reputable and socially responsible MNC plays strictly by the rules, thereby constraining advertising & communication messages - Certain competitors are taking advantage of poor enforcements by not complying strictly to the required regulations
Environmental Factors
Government and consumer association promotion of the 3Rs initiative Reduce, Reuse & Recycle and the introduction of a labeling system for plastics to ease the collection process (Source: NSTP, 7 Sep 2001; KL Structure Plan 2020, DBKL www.dbkl.gov.my)
Implications
- Nestl, being a reputable and socially responsible MNC should continue to take the lead in the 3Rs initiative to maximize its license to operate and build long-term goodwill will government and society at large
30
Customer Survey Questionnaire Sample

Market Survey for Yoghurt/Yoghurt Drink Consumption in Malaysia
Sex: F / M Marital Status: Race: M / S Malay Chinese Indian Caucasian Others Age Group: Above 61 51 - 60 41 - 50 31 - 40 21 - 30 Below 20
No. of Children:
eg;
A.
1.
Establising Market Perception

Do you know the difference between Yoghurt/Yoghurt Drink (Y/YD) & Cultured Milk Drink (CMD)? (eg; CMD = Yakult, Vitagen, Nutrigen) Yes No
2.
Which (Y/YD or CMD) do you perceived to be more nutritious? Y/YD CMD Neither
3.
Do you, or any member of your household, consume Y/YD (to Q 5) CMD (to Q 5) Neither (to Q 4)
4.
Would you consider buying Y/YD for consumption, now that you know the difference? Yes (to Q 5) No (to Q 6)
B.
5.
Deciding Factors: Pre-purchase

Please give reasons for Y/YD/CMD consumption. Please rank only the top 3 choices. (to Q 8) Nutritious Full of calcium Fat free Contains real fruit Part of staple diet Taste good Substitute for other juices Form of snacks Reasonably priced Pestered by children Attractive packaging Free premium/gifts
6.
Please give reasons for NOT consuming Y/YD/CMD. Please rank only the top 3 choices. (to Q 7) Not aware of benefits Taste intolerance Weight conscious Too expensive? Entry price/btl? Waste of money No time RM
7.
Now that you know the nutrition value of Y/YD/CMD, would you spend more on Y/YD or CMD, why? Will spend more on Reason: Y/YD RM CMD RM
8.
Who normally consume Y/YD/CMD in the family? You may select more than one. Myself Spouse Children Parents Mother Father Siblings Cousins Others
eg;
9.
Who in the family decides on the brand of Y/YD/CMD to purchase? Myself Spouse Children Parents Mother Father Siblings Cousins Others
eg;
31
10.
Which brand(s) of Y/YD/CMD do your family prefer? Nestle Vitagen Yakult Nutrigen Solivite Moojooz Yoplait Marigold Anlene Sunglo Dutch Lady No preference Others
eg;
11.
And why that particular brand or why no preference? You may select more than one. Trusted brand Price Others: Taste New flavour Availability Recommended Packaging Gifts
C.
12.
Purchasing Pattern
How much do you spend on Y/YD/CMD per month? RM per month
D.
13.
Consumption Preference
Do you and your family perceive Y/YD/CMD as . You may select more than one. Energy food/drink Part of breakfast/lunch/dinner Weight conscious diet Mixed into cereals/drinks Snacks Used for cooking Dessert Others
eg;
E.
14.
Possible Venture Channels

How much do you spend on each visit to Starbucks, Coffee Bean, McDonalds, KFC, etc.? How frequent (per month)? Spending Frequency Coffee Place RM per visit per month Fast Food RM per visit per month
15.
Would you try Y/YD/CMD blended/mixture drinks in these outlets, given the nutrition value? Yes No
16.
What are you looking for in Y/YD/CMD (flavour, nutrients, packaging)? You may select more than one. Milo-flavoured Caramel-flavoured Vanilla-flavoured Coffee-flavoured Other suggestions: Honey-flavoured Low fat High calcium Energy plus Vitamins enhanced DHA enhanced Iron enhanced Tongkat Ali enhanced
17.
Would you subscribe to have your child(ren) consume a bottle of Y/YD/CMD a day in school/kindergarten/childcare, or assuming you have children? Yes No
18.
Would you consider home delivery of Y/YD/CMD on a weekly basis and are you willing to pay slightly more for the convenience? Delivery Pay more Yes Yes RM No No
19.
Where do you think Y/YD/CMD products are most likely to have a ready market/consumer (eg; vending machines, coffee shops, mamak etc)? Please suggest: ~ Thank you ~
32
E. Customer Survey Questionnaire Results

E.1 All respondents
Total of 108 respondents
Sex Marital Status Race Male Married 21 Malay No. of childre 49 None Age Group 2 Below 20 50 73 80 Chinese 56 1-3 32 21 - 30 Female 58 Single 35 5 0 India Caucasian 3 0 4-6 7-9 53 16 31 - 40 41 - 50
Percentage
Sex Male Marital StatusMarried Race 19.4% Malay No. of childre 45.4% None Age Group 1.9% Below 20 46.3% Female 53.7% 67.6% Single 32.4% 74.1% 4.6% 0.0% Chinese India Caucasian 51.9% 2.8% 0.0% 1-3 4-6 7-9 29.6% 49.1% 14.8% 21 - 30 31 - 40 41 - 50
2 Others 0 Above 10 5 51 - 60
0 Above 61
1.9% Others 0.0% Above 10 4.6% 51 - 60
0.0% Above 61
Out of 108 correspondents, 56 know the difference while 52 do not.
Yes/No
108
Yes
51.9%
No
48.1%
Out of 108 respondents, perceived these products to be more nutritious. Y/YD 66 CMD 20 Neither 17 Both 5
Out of 108 respondents, perceived these products to be more nutritious. Y/YD 61.1% CMD 18.5% Neither 15.7% Both 4.6%
Of the 66 who perceived Y/YD to be more nutritious, consume Y/YD 32 CMD 11 Neither Of the 20 who perceived CMD to be more nutritious, consume Y/YD 5 CMD 7 Neither Of the 17 who perceived NEITHER to be more nutritious, consume Y/YD 2 CMD 6 Neither Of the 5 who perceived BOTH to be more nutritious, consume Y/YD 1 CMD 0 Neither
8 2 7 0
Both Both Both Both
15
Of the 66 who perceived Y/YD to be more nutritious, consume Y/YD 29.6% CMD 10.2% Neither Of the 20 who perceived CMD to be more nutritious, consume 6 Y/YD 4.6% CMD 6.5% Neither Of the 17 who perceived NEITHER to be more nutritious, consume 2 Y/YD 1.9% CMD 5.6% Neither Of the 5 who perceived BOTH to be more nutritious, consume 4 Y/YD 0.9% CMD 0.0% Neither
7.4% 1.9% 6.5% 0.0%
Both Both Both Both
13.9% 5.6% 1.9% 3.7%
Of the 6 who don't know the difference and consume NEITHER would consider buying now that they know the difference Yes 2 No 4
Of the 6 who don't know the difference and consume NEITHER would consider buying now that they know the difference Yes 33.3% No 66.7%
Of the 108 respondents, consume Y/YD/CMD because of ... Nutritious Full of calcium Fat free Contains real fruit Part of staple diet Taste good 82 32 24 29 11 48 Substitute for other juices Form of snacks Reasonably priced Pestered by children Attractive packaging Free premium/gifts 22 19 13 14 0 4 298
Of the 108 respondents, consume Y/YD/CMD because of ... Nutritious Full of calcium Fat free Contains real fruit Part of staple diet Taste good 27.5% 10.7% 8.1% 9.7% 3.7% 16.1% Substitute for other juices Form of snacks Reasonably priced Pestered by children Attractive packaging Free premium/gifts 7.4% 6.4% 4.4% 4.7% 0.0% 1.3%
Of the 108 respondents, did NOT consume Y/YD/CMD because of Not aware of benefits Taste intolerance Weight conscious 23 Too expensive? Entry price/btl? 21 Waste of money 8 No time 16 9 10 87 Of the 108 respondents, they will spend more on Y/YD 26 11.54 CMD 5 RM3 Reason: more substance, nutritious cheap & healthy, taste, low fat, multi-flavour Of the 108 who DON'T know the difference, family member(s) who consume Y/YD/CMD are Myself Spouse Children 66 29 48 Parents Mother Father Siblings Cousins Others 31
Of the 108 respondents, did NOT consume Y/YD/CMD because of Not aware of benefits Taste intolerance Weight conscious 26.4% Too expensive? Entry price/btl? 24.1% Waste of money 9.2% No time 18.4% 10.3% 11.5%
Of the 108 respondents, they will spend more on Y/YD 83.9% CMD 16.1% Reason: more substance, nutritious cheap & healthy, taste, low fat, multi-flavour Of the 108 respondents, family member(s) who consume Y/YD/CMD are Myself Spouse Children 39.3% 17.3% 28.6% Parents Mother Father Siblings Cousins Others 4.8% 0.6% 0.0%
13 3
8 1 0 168
7.7% 1.8%
Of the 108 respondents, family member(s) who decides on the brand are Myself Spouse Children 66 34 17 Parents Mother Father Siblings Cousins Others 3 0 0 137
Of the 108 respondents, family member(s) who decides on the brand are Myself Spouse Children 48.2% 24.8% 12.4% Parents Mother Father Siblings Cousins Others 2.2% 0.0% 0.0%
13 4
9.5% 2.9%
Of the 108 respondents, the brand they consume are Nestle Vitagen Yakult Nutrigen because of Trusted brand 61 Taste 62 Availability Price 28 New flavour 6 Recommende Others: low fat and more natural, poor marketing for no preference taste is important, not too sweet, low sugar 23 Packaging 8 Gifts 57 55 28 31 Solivite Moojooz Yoplait 15 0 15 Marigold Anlene Sunglo Dutch Lady 12 No preferenc 17 Others 5 3 8 0
Of the 108 respondents, the brand they consume are Nestle Vitagen Yakult Nutrigen because of 4 Trusted brand 31.0% Taste 31.5% Availability 11.7% Packaging 5 Price 14.2% New flavour 3.0% Recommende 4.1% Gifts 197 Others: low fat and more natural, poor marketing for no preference taste is important, not too sweet, low sugar 2.0% 2.5% 23.2% 22.4% 11.4% 12.6% Solivite Moojooz Yoplait 6.1% 0.0% 6.1% Marigold Anlene Sunglo Dutch Lady 4.9% No preferenc 6.9% Others 2.0% 1.2% 3.3% 0.0%
246
Of the 108 respondents, spending on Y/YD/CMD per month on average is RM 46.00 per month 46.24
Of the 108 respondents, spending on Y/YD/CMD per month on average is RM 46.00 per month 46.24
Of the 108 respondents, they perceived Y/YD/CMD as Energy food/drink Part of breakfast/lunch/dinner Weight conscious diet Mixed into cereals/drinks 51 28 15 7 Snacks Used for cooking Dessert Others 45 1 10 1 eg; 158
Of the 108 respondents, they perceived Y/YD/CMD as Energy food/drink Part of breakfast/lunch/dinner Weight conscious diet Mixed into cereals/drinks 32.3% 17.7% 9.5% 4.4% Snacks Used for cooking Dessert Others 28.5% 0.6% 6.3% 0.6% eg;
33
Of the 108 respondents, they would spend each visit the following outlets each month.
Of the 108 respondents, they would spend each visit the following outlets each month.
Coffee RM71 per visit 71.11 Fast Food RM69 per visit 8.00 per month 8.09 9.10 per month RM290 289.46 RM298 Of the 108 respondents, they would/would not try Y/YD/CMD mixture drinks in these outlets. Yes 74 No 29
68.78 9.07 297.57
Coffee RM71 per visit 71.11 Fast Food RM69 per visit 8.00 per month 8.09 9.10 per month RM290 289.46 RM298 Of the 108 respondents, they would/would not try Y/YD/CMD mixture drinks in these outlets. Yes 68.5% No 26.9%
68.78 9.07 297.57
Of the 108 respondents, the ingredients that they were looking for in Y/YD/CMD are 21 Honey-flavoured 8 Vitamins en 8 Low fat 33 DHA en 20 High calcium 62 Iron en 13 Energy plus 17 Tongkat Ali e taste, coffee-flavoured, green tea-flavoured, high protein, pink guav organic Of the 108 who DON'T know the difference, they would subscribe their children to a bottle of Y/YD/CMD a day in school/kindergarten/childcare. Yes 79 No 21 100 Of the 108 respondents, they would (or not) consider home delivery of Y/YD/CMD and would (or not) pay more. Delivery Pay more Yes Yes 36 10 RM 12.00 No No 70 70 Milo-flavoured Caramel-flavoured Vanilla-flavoured Coffee-flavoured Other suggestions: 56 25 21 2 286
Of the 108 respondents, the ingredients that they were looking for in Y/YD/CMD are 7.3% Honey-flavoured 2.8% Vitamins en 2.8% Low fat 11.5% DHA en 7.0% High calcium 21.7% Iron en 4.5% Energy plus 5.9% Tongkat Ali e taste, coffee-flavoured, green tea-flavoured, high protein, pink guava organic Of the 108 respondents, they would subscribe their children to a bottle of Y/YD/CMD a day in school/kindergarten/childcare. Yes 79.0% No 21.0% Milo-flavoured Caramel-flavoured Vanilla-flavoured Coffee-flavoured Other suggestions: 19.6% 8.7% 7.3% 0.7%
Of the 108 respondents, they would (or not) consider home delivery of Y/YD/CMD and would (or not) pay more. 106 Delivery 80 Pay more Yes Yes 34.0% 12.5% RM 12.00 No No 66.0% 87.5%
Of the 108 respondents, the perceived the following places would have a ready market
Of the 108 respondents, the perceived the following places would have a ready market
Please suggest:
indian market, middle eastern restaurants, 7-11, starbucks schools, supermarkets, playground, grocery, fast food outlets, cake shops, theme parks, hospital, gyms, food courts, spas, public transport stations
Please suggest:
indian market, middle eastern restaurants, 7-11, starbucks schools, supermarkets, playground, grocery, fast food outlets, cake shops, theme parks, hospital, gyms, food courts, spas, public transport stations
34
E.2 Respondents who know/dont know the difference between Y/YD and CMD
Out of the 108, 56 who knew of the difference between Y/YD and CMD
Sex Marital Status Race No. of childre Age Group Below 20 Male Married 12 Malay 21 None 26 43 40 Chinese 34 1-3 18 21 - 30 Female 31 Single 12 3 India Caucasian 1 4-6 7-9 24 10 31 - 40 41 - 50
Out of the 108, 52 who DON'T know the difference between Y/YD and CMD
Sex Marital Status Race Male Married 9 Malay No. of childre 28 None Age Group 2 Below 20 24 30 40 Chinese 22 1-3 14 21 - 30 Female 27 Single 23 2 India Caucasian 2 4-6 7-9 29 6 31 - 40 41 - 50
1 Others Above 10 4 51 - 60
1 Others Above 10 1 51 - 60
Above 61
Above 61
Yes
56
No
52
Of the 56 who knew the difference, perceived these products to be more nutritious. 40 CMD 11 Neither 71.4% 19.6% Of the 40 who perceived Y/YD to be more nutritious, consume Y/YD 19 CMD 9 Neither Of the 11 who perceived CMD to be more nutritious, consume Y/YD 1 CMD 6 Neither Of the 1 who perceived NEITHER to be more nutritious, consume Y/YD 0 CMD 0 Neither Of the 4 who perceived BOTH to be more nutritious, consume Y/YD 1 CMD 0 Neither Y/YD 1 1.8% 1 0 1 0 Both 4 7.1% 11 4 0 3
Out of 52 who DON'T know the difference, perceived these products to be more nutritious. Y/YD 26 CMD 9 Neither 50.0% 17.3% Of the 26 who perceived Y/YD to be more nutritious, consume Y/YD 13 CMD 2 Neither Of the 9 who perceived CMD to be more nutritious, consume Y/YD 4 CMD 1 Neither Of the 16 who perceived NEITHER to be more nutritious, consume Y/YD 2 CMD 6 Neither Of the 1 who perceived BOTH to be more nutritious, consume Y/YD CMD Neither 16 30.8% 7 2 6 Both 1 1.9% 4 2 2 1
Both Both Both Both
Both Both Both Both
Of the 6 who don't know the difference and consume NEITHER would consider buying now that they know the difference Yes 2 No 4
Of the 56 who knew the difference, consume Y/YD/CMD because of ... Nutritious Full of calcium Fat free Contains real fruit Part of staple diet Taste good 48 20 21 6 6 29 Substitute for other juices Form of snacks Reasonably priced Pestered by children Attractive packaging Free premium/gifts 11 9 7 7
Of the 52 who DON'T know the difference, consume Y/YD/CMD because of ... Nutritious Full of calcium Fat free Contains real fruit Part of staple diet 3 Taste good 34 12 3 23 5 19 Substitute for other juices Form of snacks Reasonably priced Pestered by children Attractive packaging Free premium/gifts 11 10 6 7 1
Of the 56 who knew the difference, did NOT consume Y/YD/CMD because of Not aware of benefits Taste intolerance Weight conscious 7 Too expensive? Entry price/btl? 9 Waste of money 4 No time 8 RM0.3 4 3
Of the 52 who DON'T know the difference, did NOT consume Y/YD/CMD because of Not aware of benefits Taste intolerance Weight conscious 16 Too expensive? Entry price/btl? 12 Waste of money 4 No time 8 RM1.5 5 7
Of the 56 who knew the difference, they will spend more on Y/YD 10.00 9.77 Reason: cheap & healthy, taste, low fat, multi-flavour CMD 2.00 RM
Of the 52 who DONT know the difference, they will spend more on Y/YD 16 11.54 Reason: more substance, nutritious CMD 3 RM3
Of the 56 who knew the difference, family member(s) who consume Y/YD/CMD are sex Myself 34 Siblings Parents Spouse 18 Mother 5 Cousins Children 30 Father 1 Others Of the 56 who knew the difference, family member(s) who decides on the brand are ... sex Myself 39 Siblings Parents Spouse 19 Mother 4 Cousins Children 12 Father 2 Others Of the 56 who knew the difference, the brand they consume are Nestle Vitagen Yakult Nutrigen because of Trusted brand 31 Taste 33 Availability Price 12 New flavour 2 Recommende Others: taste is important, not too sweet, low sugar 12 Packaging 4 Gifts 33 30 18 18 Solivite Moojooz Yoplait 10 11 Marigold Anlene Sunglo Dutch Lady
Of the 52 who DON'T know the difference, family member(s) who consume Y/YD/CMD are 2 Myself Spouse Children 32 11 18 Parents Mother Father Siblings Cousins Others 6 1
8 2
Of the 52 who DON'T know the difference, family member(s) who decides on the brand are Myself Spouse Children 27 15 5 Parents Mother Father Siblings Cousins Others 3
9 2
Of the 52 who DON'T know the difference, the brand they consume are 6 No preferenc 2 6 Others 2 eg; Goodday 2 Nestle Vitagen Yakult Nutrigen because of 1 Trusted brand 30 Taste 29 Availability 2 Price 16 New flavour 4 Recommende Others: low fat and more natural, poor marketing for no preference 11 Packaging 4 Gifts 3 3 24 25 10 13 Solivite Moojooz Yoplait 5 4 Marigold Anlene Sunglo Dutch Lady 6 No preferenc 11 Others 3 1 6
Of the 56 who knew the difference, spending on Y/YD/CMD per month on average is RM 25.00 per month 24.98
Of the 52 who DON'T know the difference, spending on Y/YD/CMD per month on average is RM 21.00 per month 21.26
Of the 56 who knew the difference, they perceived Y/YD/CMD as Energy food/drink Part of breakfast/lunch/dinner Weight conscious diet Mixed into cereals/drinks 29 13 7 2 Snacks Used for cooking Dessert Others 20 3 1 eg; for fun
Of the 52 who DON'T know the difference, they perceived Y/YD/CMD as Energy food/drink Part of breakfast/lunch/dinner Weight conscious diet Mixed into cereals/drinks 22 15 8 5 Snacks Used for cooking Dessert Others 25 1 7 eg;
35
Of the 56 who knew the difference, they would spend each visit the following outlets each month.
Of the 52 who DON'T know the difference, they would spend each visit the following outlets each month.
Coffee RM39 per visit 38.87 Fast Food RM41 per visit 41.10 Coffee RM32 per visit 32.24 Fast Food RM28 per visit 27.68 4.40 per month 4.34 3.50 per month 3.47 3.80 per month 3.74 6.00 per month 5.59 RM169 168.83 RM143 142.79 RM121 120.63 RM155 154.78 Of the 56 who knew the difference they would/would not try Y/YD/CMD mixture drinks in these outlets. Of the 52 who DON'T know the difference they would/would not try Y/YD/CMD mixture drinks in these outlet Yes 36 No 18 Yes 38 No 11
Of the 56 who knew the difference, the ingredients that they were looking for in Y/YD/CMD are Milo-flavoured Caramel-flavoured Vanilla-flavoured Coffee-flavoured Other suggestions: 12 5 9 7 organic Honey-flavoured Low fat High calcium Energy plus 28 2 Vitamins en 13 DHA en 13 33 Iron en 11 6 Tongkat Ali enhanced
Of the 52 who DON'T know the difference, the ingredients that they were looking for in Y/YD/CMD are Milo-flavoured Caramel-flavoured Vanilla-flavoured Coffee-flavoured Other suggestions: 9 Honey-flavoured 6 Vitamins en 3 Low fat 20 DHA en 11 High calcium 29 Iron en 6 Energy plus 11 Tongkat Ali e taste, coffee-flavoured, green tea-flavoured, high protein, pink guava 28 12 10 2
Of the 56 who knew the difference, they would subscribe their children to a bottle of Y/YD/CMD a day in school/kindergarten/childcare. Yes 45 No 80% Of the 56 who knew the difference, they would (or not) consider home delivery of Y/YD/CMD and would (or not) pay more. Delivery Pay more Yes Yes 21 8 RM 5.00 No No 8 14%
Of the 52 who DON'T know the difference, they would subscribe their children to a bottle of Y/YD/CMD a day in school/kindergarten/childcare. Yes 34 No 13 65% 25% Of the 52 who DON'T know the difference, they would (or not) consider home delivery of Y/YD/CMD and would (or not) pay more. Delivery Pay more Yes Yes 15 2 RM 7.00 No No 35 37
35 33
Of the 56 who knew the difference, the perceived the following places would have a ready market
Of the 52 who DON'T know the difference, the perceived the following places would have a ready market
Please suggest:
vending machines, restaurants, office lots, coffee shops, parks, schools, supermarkets, playground, grocery, fast food outlets, cake shops, theme parks, hospital, gyms, food courts, spas, public transport stations
Please suggest:
indian market, middle eastern restaurants, 7-11, starbucks
36
F. Customer Survey Analysis

Perception of Y/YD/CMD to be nutritious Which is perceived to be more nutritious Consume or Not What they consume Y/YD 32 (55.1%) consume 58 (87.9%) CMD 11 (19%) Both 15 (25.9%) don't consume 8 (12.1%) Y/YD 5 (27.8%) consume 18 (90%) CMD 7 (38.9%) Both 6 (33.3%) don't consume 2 (10%) Y/YD 1 (20%) consume 5 (100%) 108 Respondent Both 5 (5.5%) don't consume 0 (0%) Y/YD 2 (20%) consume 10 (58.8%) CMD 6 (60%) Both 2 (20%) don't consume 7 (41.2%) Y/YD 1.9% CMD 5.5% Both 1.9% Non-consumer 15.8% CMD 0 (0%) Both 4 (80%) Y/YD 0.9% CMD 0.0% Both 3.7% Y/YD 4.6% CMD 6.5% Both 5.6% Effective Consumption Y/YD 29.6% CMD 10.2% Both 13.9%
Y/YD 66 (72.5%)
nutritious 91 (84.3%)
CMD 20 (22%)
not nutritious 17 (15.7%)
Figure 20: Perception versus Consumption
The survey revealed that perceived nutritional value will lead to higher consumption. For example, respondents who consume Y/YD and CMD exclusively, the effective Y/YD consumption amongst those who perceive Y/YD and CMD to be more nutritious are 29.6% and 6.5% respectively. Effective exclusive Y/YD and CMD consumption across all respondents are 37% and 22.2% respectively while those that consume both is 25.1%.
The survey revealed that 52% of the Malaysian public is aware (52%) and 48% is ignorant of yoghurt/yoghurt drinks and its benefits. For those who are informed of the differences between yoghurt/yoghurt drinks (Y/YD) and cultured milk drink (CMD), more than 70% perceived that the former has higher nutritious value. Meanwhile, respondents who are not conscious of the
37
difference, while still skewed towards Y/YD superiority at 50%, but with a higher percentage (30%) believing that neither are value-added, as compared to less than 2% for respondents who knew the difference between Y/YD and CMD. As a result, it can be implied that the lack of awareness significantly hampers XYZCos objective of capturing a larger market share on the domestic front. For those who perceived that neither Y/YD nor CMD are beneficial, they would likely consume the CMD. Thus, it is crucial that the public is educated on the health benefits of Y/YD to acquire new customers.
Preferred Brands
25.0% 20.0% 15.0% 10.0% 5.0% 0.0% Of the 108 respondents, the brand they consume are Nestle Moojooz Dutch Lady Vitagen Yoplait No preference Yakult Marigold Others Nutrigen Anlene Solivite Sunglo
Figure 21: Brands Preference
It is also established that XYZCo, at 23%, is the preferred brand among all respondents with Vitagen being a close second. Similarly, XYZCo (24%) and Vitagen (22%) are also the preferred brands among those who knew the difference between Y/YD and CMD. However, Vitagen (23%) is marginally more popular than XYZCo (22%) among those who didnt know the difference. Therefore, this again reiterates the need to make aware the presence and benefits of Y/YD. It is also noted that Yakult, although a relatively new entrant to the market has gained significant mind share, as a total of 10% of the respondents prefer Yakult.
38
Family members who decide on the brand

60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% Of the 108 respondents, family member(s) who decides on the brand are Myself Spouse Children Mother Father Siblings Cousins Others
Figure 22: Decision Makers
Because of well-balanced respondents in terms of gender, the survey also disclosed that decisions on choice of brands were much reliant upon the adults in the family, insignificant of the gender issue. Apart from single adults who purchase for own consumption or for their parents or close relations, parents of a young family have more authority in the decision of the purchase, not the children, which caters only 10% of influential decision makers. This findings disprove of the one asserted by XYZCo that attractive packaging (0%), premiums (1.3%), and constant beleaguering by the children (4.7%) are drivers of a purchase. However, one has to take note that certain decisions could be subconsciously driven. The top 3 factors of Y/YD consumption are nutritional value (27.5%), good tastes (16.1%) and high calcium (10.7%).
Preferred certain brands because of

35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 1 Trusted brand Price Taste New flavour Availability Recommended Packaging Gifts
Figure 23: Brand Selection Criteria
39
A huge 68.5% of the respondents welcomed the idea of Y/YD being offered in places like Starbucks, Coffee Bean, KFC, and McDonalds. It is believed that the market for consumers frequenting these outlets are massive, targeting the teenage to working adults segment for the coffee places; and family with young children for the fast food channels. A substantial amount (approximately RM300 per family) is allocated to spending at these outlets monthly.
80% of respondents (with or without children) are receptive to the idea of introducing Y/YD in pre-schools (childcare centres and kindergartens). Capturing the children while they are young ensure long-term brand affinity and loyalty as proven with the successful strategy of Milo, in Malaysia, and perhaps regionally. Through the concept direct selling to pre-schools, parents perceived that their children are assured of a healthy portion of their childrens meal each day.
Ingredients in which respondents are looking for in Y/YD/CMD

25.0% 20.0% 15.0% 10.0% 5.0% 0.0% Of the 108 respondents, the ingredients that they were looking for in Y/YD/CMD are Milo-flavoured Honey-flavoured Vitamins enhanced Caramel-flavoured Low fat DHA enhanced Vanilla-flavoured High calcium Iron enhanced Coffee-flavoured Energy plus Tongkat Ali enhanced
Figure 24: Ingredients Preferences
Other initiatives such as expanding the product line by introducing other flavours such as Miloflavoured Y/YD (7.3%), honey-flavoured (2.8%) or enhanced with various vitamins did not receive a gratifying respond. Thus, product line extension will not be pursued for the time being.
Similarly, the initiative to tap the home delivery channel was not well-received with respondents citing the lack of interest (34.0%) and a huge 87.5% were reluctant to pay more for the higher delivery cost. The fact that many working adults would not be home to pick up a fresh bottle of Y/YD dampens the expansion of this channel.
40
G. Pre-schools Promotional Activities a) Creation of a Kiddies Club involving: Building customer database; XYZCo then gives redemption coupons or discounts on its products or premium items creating loyalty. Contests enhancing childrens creativity by using XYZCo products allowing children to win prizes such as trips to Disney Land Hong Kong or gift vouchers. An example of a contest includes building items using XYZCo yogurt bottles. Recycling activities that can enhance social image through press activities. This includes recycling of XYZCo bottles. Further to that, children can make extra income for a social cause from the recycling activity to instill good social behaviour and civic mindedness. Quarterly newsletters promoting activities (past, present and future) within the Kiddies Club. b) Educational materials: VCDs where the family mascots are used in educating children on healthy living using XYZCo products through songs and activities. This is much similar to popular children education programs such as Sesame Street and Barney and friends which educate children through characters and songs. Educational and Games CDs demonstrating the use of XYZCo products. For example, a Pac-Man type game where XYZCo products can enhance characters powers demonstrating the goodness of XYZCo. Exercise/Activity books on quarterly basis. Children will be able to color and solve simple puzzles via activity books based on XYZCo products and mascots. This is similar to M&Ms Count Book which teaches kids to count using M&M chocolates. c) Conducting promotional activities such as school plays and contests in shopping malls, Schools Pre-schools Funfairs. Others d) Premiums items (with proposed mascots) such as mugs, watches, caps, key chains, t-shirts others.
41
H. Sales Volume and Revenue Projection

H.1 Quick Service Restaurants
3-year revenue projection

KFC Avg T/O per outlet (kg) Category Share (%) Category volume (kg) Nestle Market Share (%) Sales Volume (kg) No. of outlets KFC Sales (kg) Assume Revenue per Kg KFC Revenue (RM) McDonalds No. of outlets McDonalds Sales (kg) Assume Revenue per Kg McDonalds Revenue (RM) QSR Sales Volume (kg) QSR Sales Value (RM) $ $ $ YEAR 1 YEAR 2 YEAR 3 Source:www.qsrbrands.com & estimates 167,924 10.0% 16,792 10.0% 1,679 420 705,281 4.5 3,173,765 $ 167,924 10.0% 16,792 20.0% 3,358 430 1,444,147 4.5 6,498,662 $ 167,924 10.0% 16,792 30.0% 5,038 440 2,216,598 4.5 9,974,690
Source: www.mcdonalds.com.my & Estimates 158 265,320 4.5 1,193,940 $ 970,601 4,367,705 $ 168 564,225 4.5 2,539,012 2,008,372 9,037,674 $ $ 178 896,715 4.5 4,035,216 3,113,312 14,009,906
H.2 Coffee Places (Coffee Bean and Starbucks)

YEAR 1 CoffeeBean Annual Turnover (RM) Category Share (%) Category value (RM) Nestle Market Share (%) Sales Value (RM) Avg Cup Value (RM) No. of cups Avg Volume per cup (kg) Coffeebean Sales (kg) Assume Revenue per Kg CoffeeBean Revenue (RM) Starbucks Annual Turnover (RM) Category Share (%) Category value (RM) Nestle Market Share (%) Sales Value (RM) Avg Cup Value (RM) No. of cups Avg Volume per cup (kg) Starbucks Sales (kg) Assume Revenue per Kg Starbucks Revenue (RM) Coffee Outlets Sales (kg) Coffee Outlets Revenue (RM) $ $ $ YEAR 2 Source: CTOS & Estimates 42,000,000 17.0% 7,140,000 12.0% 856,800 10 86,111 0.3 25,833 4.5 116,249 $ YEAR 3 43,000,000 20.0% 8,600,000 15.0% 1,290,000 10 129,648 0.3 38,894 4.5 175,025 41,000,000 15.0% 6,150,000 10.0% 615,000 10 61,809 0.3 18,543 4.5 83,442 $
Source: CTOS & Estimates 42,000,000 15.0% 6,300,000 10.0% 630,000 10 63,317 0.3 18,995 4.5 85,477 $ 37,538 168,920 $ 45,000,000 17.0% 7,650,000 12.0% 918,000 10 92,261 0.3 27,678 4.5 124,553 53,512 240,802 $ $ 48,000,000 20.0% 9,600,000 15.0% 1,440,000 10 144,724 0.3 43,417 4.5 195,377 82,312 370,402
42
H.3 Childcare Centres and Kindergartens

YEAR 1 Childcare Center No. of childcare center % buy-in No. of childcare center buy-in Avg children / center No. of children % children subscription No. of subscribed children Consumption/child/month Childcare Ctr Sales (kg) Assume Revenue per Kg Childcare Ctr Revenue (RM) Kindergarten No. of Private Kindergartens % buy-in No. of Kindergarten buy-in Avg children / Kindergarten No. of children % children subscription No. of subscribed children Consumption/child/month (kg) Kindergarten Sales (kg) Assume Revenue per Kg Kindergarten Revenue (RM) Pre-School Sales (Kg) Pre-School Revenue (RM) $ $ $ YEAR 2 YEAR 3 Source: The Star (26 May 2005) 1,700 30.0% 510 25 12,750 80% 10,200 2.5 306,000 4.5 1,377,000 $ 1,800 40.0% 720 25 18,000 90% 16,200 2.5 486,000 4.5 2,187,000 1,600 20.0% 320 25 8,000 75% 6,000 2.5 180,000 4.5 810,000 $
Source: Social Statistics Bulletin 2004, Dept of Statistics 3,500 10.0% 350 50 17,500 75% 13,125 4.0 630,000 4.5 2,835,000 $ 810,000 3,645,000 $ 3,600 20.0% 720 50 36,000 80% 28,800 4.0 1,382,400 4.5 6,220,800 1,688,400 7,597,800 $ $ 3,700 30.0% 1,110 50 55,500 90% 49,950 4.0 2,397,600 4.5 10,789,200 2,883,600 12,976,200
H.4 Primary Schools

YEAR 1 Primary Schools No. of Primary Schools % in Urban Centers No. of Urban Schools No. of primary students nationwide No. of urban primary students % urban students subscription No. of subscribed children Consumption/student/month (kg) Assume Revenue per Kg Primary School Sales (kg) Primary School Revenue (RM) $ YEAR 2 YEAR 3 Source: Bernama (25 Aug 2005) 7,620 60.0% 4,572 3,160,000 1,896,000 10% 189,600 2.5 4.5 5,688,000 25,596,000 $ 7,678 60.0% 4,607 3,200,000 1,920,000 15% 288,000 2.5 4.5 8,640,000 38,880,000 7,562 60.0% 4,537 3,120,000 1,872,000 5% 93,600 2.5 4.5 2,808,000 12,636,000 $
43

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MBA Programme Part Time

XYZCo Chilled Diary Business Strategic Marketing Plan 2006-2008

Module Title: Marketing (N1DM04) Module Lecturer/Facilitator: John Zinkin

The plan is developed based on information gathered from:

o Consumption: Daily by 2/3 of Malaysian urban households

Past Juices 41%

Y ogurt Drink 17%

Past Milk 21%

Figure 1: Total Malaysian Chilled Market

Figure 2: Total Malaysian Chilled Market without pasteurized products

60 40 20 0 2005 33.2 7.6 3.3 2006 2007 42.4

CMD Yogurt Drink Yogurt

Figure 3: Market Projection

2 0 2005 2006 2007 2008

Figure 4: Consumption Projection11

2.2Industry Analysis (Porters 5-Forces)

Figure 5: Porter's 5-Forces Analysis

Source of Authority 1. Reputable & Trusted Global Brand 2. Market leadership

Figure 6: Brand Promise Analysis

Internal Environmental Analysis (Brand Promise, McKinseys 7S)

Figure 7: TOWS Analysis Framework

Figure 8: TOWS Analysis

not nutritious 17 (15.7%)

Figure 9: Perception versus Consumption

Figure 10: Brands Preference

Preferred certain brands because of

Figure 11: Brand Selection Criteria

Ingredients in which respondents are looking for in Y/YD/CMD

Figure 12: Ingredients Preferences

3. Strategic Marketing Plan

Low Fat Yogurt Yogurt Drink

Figure 13: Product & Brand Personality Communication

Figure 14: Family Mascots Sample

Brand Personality Focus

Communication Media / Platform

Parents ~ Competence ~ Sophistication

Teenagers to Working Adults ~ Excitement ~ Sophistication

Figure 15: Brand Personality and Communication Media 14

Refer to Appendix H Sales Volume and Revenue Projection for details.

The following promotional activities are discussed in more details in Appendix G:

3-year sales volume & market share projection

35,000 25,350 60,350 10.8%

44,800 27,125 71,925 12.9% 16.8%

57,344 29,023 86,367 14.2% 20.8%

73,400 31,055 104,455 15.2% 23.5%

4.2 Income Projection

3-year Income projection (RM '000)

29,774 7,239 22,535 2.43 11,899 7,020 4,167 712

71% $ 24% $ 76% $ $ 29% $ 17% $ 10% $ 2% $

Past Juices 41%

Y ogurt Drink 17%

Past Milk 21%

Figure 16: Total Malaysian Chilled Market

Figure 17: Total Malaysian Chilled Market without pasteurized products

80 60 40 20 0 33.2 7.6 3.3 2006 2007 42.4

CMD Yogurt Drink Yogurt

Figure 18: Chilled Dairy Market Size Projection

2 0 2005 2006 2007 2008

Figure 19: Consumption Projection35

CMD Competitive Map

B.1 CMD Competitive Map

$2.50 400 500 Size (ml) 600 700 800

Yogurt Drink Competitive Map