Presentation on Marketing Management Case 1

Marketing Research for Drawstring Trash Bags in Brazil

G ROUP 1 (N UMERO U NO )
Group Members:

Iman Nurrohman Alfin Falihian

Azhar Harris
Indriani

AGENDA

Case Fact : Ad-Lider Theory : Marketing Research Discussion & Recommendation

CASE FACT AD-LIDER SA

COMPANY PROFILE
Ad-lider Embalagens Ad-Lider Embalagens, SA was founded in 1970. The company, headquartered in the town of Tres Rios, Rio de Janeiro is one of Brazils largest manufacturers of plastic bags and packaging. A commercial Office is located in the city of Rio de Janeiro.

COMPANY PROFILE
Ad-lider Embalagens The firm sells direct to large accounts and uses 43 specialized distributors to cover other accounts throughout Brazil. Sales by region vary greatly: Southeast : 50% North and Northeast : 25% Central-West 12% South 10% Total sales in 1998 were US$21 million and were forecasted to be in the US$2527 million range for 2001

COMPANY PROFILE
Ad-lider Embalagens
The company had three divisions: Commercial products (52% income) : AD-ROLL AD-SHOP Consumer products

LIMP-O-DIXO

FREEZER SACOS REFORCADOS AD-LIDER Industrial products automated packaging line for manufacturers packaging material bundle products

BACKGROUND
There were three national brands of garbage bag rolls: Limp-o-Lixo (Ad-Lider) Dover Roll (Fort Roll) Koleta (Colmag)

Ad-Lider want to lauch new product : Fecha Facil Ad-Lider needed to launch a new product that was different, modern, and offered the market amore favorable cost/benefit relationship than products currently on the market. A successful launch of the Fecha Facil was of extreme importance. They believed that the current Ad-lider product mix would not bring satisfactory profits in the long term.

MARKET PROFILE
Brazils Population and Segmentation in different areas: The country is divided into 24 states, two territories, and a federal district. Of Brazils 170 million population, almost 43% or 72 million, live in the Southeast. Brazils three largest metropolitan areas are all in the Southeast: Sao Paulo (20.2 million), Rio de Janeiro (12.15 million), and Belo Horizonte (5.3 million). Brazil is one the worlds largest countries, covering an area of 8.5 million square kilometers Brazilians categorized in the Social Class C group were the most benefited by this economic stabilization.

M ARKETING R ESEARCH T HEORY

DEFINITION

Marketing research is

the systematic design, collection, analysis, and reporting of data and findings

relevant to a specific marketing situation facing the company.

MARKET RESEARCH PROCESS

Define the problem & objectives

Develop research plan

Collect information

Analyize information

Present the findings

Make decisions

S TEP 1 D EFINE

THE

P ROBLEM

DEFINE THE PROBLEM

Scope of problem: Marketing managers must be careful not to define the problem too broadly or too narrowly for the marketing researcher
Ad-Lider were looking for information about

consumer preferences, consumer habits, and perceived competitive advantages

that would impact pricing, product size, distribution decision regarding of launching their new product (Climp Fecha Facil).

DEFINE THE PROBLEM

Market Research for New Product Purchase Intercept Interviews (April-June 1999) Focus Group (Novembber 24-25, 1999) Additional Individual Interviews in Test Market (May-June, 2001)

DEFINE THE PROBLEM

Market Research for New Product Purchase Interview Period : 1999 and 2001 Location : Sendas Supermarket in Rio de Jainero Objectives : o Determine the profile of the garbage bag purchaser (user) by gender o Determine the frequency of garbage bag purchases by households o Determine the relative market shares of major brands o Determine the primary motivators/concerns with the purchase of garbage bags o Determine how well the Climp Fecha Facil bag competed with the Dover Roll with-a-handle bag.

DEFINE THE PROBLEM

Market Research for New Product Focus Group : Period : the qualitative research was performed on November 24 and 25, 1999 Location : Sao Paulo and Rio de Janeiro. Objective : To evaluate the acceptance of the new garbage bag Fecha Facil, and learn about the packaging preferences and the perceptions of housewives in relation to the closing system of the new product.

DEFINE THE PROBLEM

Theory :

Specific
Exploratory Descriptive Causal

Fact :

Specific objective : purchasers profile, frequency of purchase, market segment, primary motive, competitiveness with other major brand

S TEP 2 D EVELOP R ESEARCH P LAN

DEVELOP RESEARCH PLAN

Kotler:

The second stage of marketing research is where we develop the most efficient plan for gathering the needed information and what that will cost Need to make decisions about

the data sources, research approaches,

research instruments,
sampling plan, and contact methods

DEVELOP RESEARCH PLAN

Data Sources :

Used both primary and secondary data source Primary data source gathered from two groups of housewives :

Rio De Jeneiro : living in appartments, mainly single and divorced woman, age 32-42, high school education, minority were profesional woman

Sao Paulo :

Living in houses, married woman, age 28-40, with children, min high school education, some university graduates and has professional career Living in appartments, married/single woman, age 28-39, most with university degree, has professional career

DEVELOP RESEARCH PLAN

Data Sources :

Secondary data source gathered from :

Official data about Brazil, includes : covering area, population, state administration Social class classification developed by Brazilian Market Research Association (ABIPEME)

DEVELOP RESEARCH PLAN

Approach :

Used type of :

Focus group : 2 conducted in Sao Paulo, and 1 conducted in Rio Observation : using Purchase Intercept Interviews conducted on :

April-June 1999, at 29 Sendas Supermarkets with 528 interviews, of which 495 were considered valid. During final week of it, Limp-o-Lixo brand was on sale May-June 2001, at Sendas Supermarket, on which during April-June 2001 the Climp Fecha Facil garbage was on placed

DEVELOP RESEARCH PLAN

Instrument :

Used questionnaires :

Open-end questions in focus group discussions and individual interviews Looking for more about insight into how people think rather than measuring how many people think in certain way

DEVELOP RESEARCH PLAN

Sampling Plan :

Based on three decisions :

Sampling unit : housewives living in largest metropolitan areas (southeast, where live 43% population), include Sao Paulo (20.2 million) and Rio de jeneriro (12.15 million) Sampling size : 528 people in which 495 were considered valid Sampling procedure

DEVELOP RESEARCH PLAN

Contact Method :

Used personal contact with 2 forms :

Arranged interviews : performed at focus group discussions Intercept interviews : performed in Sendas supermarket with 528 interviews where 495 were considered valid

DEVELOP RESEARCH PLAN

Conclusion

The research plan of drawstring trash bags by AdLider Embalagens, SA had fullfilled the theory for each part of research plan By this plan, it would be hoped that the result could be considered objective and the strategy created based on it, would be appropriate and successfull in marketing the product

STEP 3 C OLLECT

THE I NFORMATION

COLLECT THE INFORMATION

The data collection phase of marketing research is generally the most expensive and the most prone to error (Kotler-Keller)

Research approach option: Observational Focus group Survey Behavioral data Experiment

Research Instruments: Questionnaire Qualitative measures Technological device

Sampling plan and contact methods: Mail Phone In person Online

A focus group is gathering of 6 to 10 people carefully selected by researchers based on certain demographic, psychographic, or other considerations and brought together to discuss various topics of interest at length (Kotler-Keller)

COLLECT THE INFORMATION

Internationally, one of the biggest obstacle to collecting information is the need to achieve consistency (Kotler-Keller) Latin america respondents maybe uncomfortable with the impersonal nature of the Internet and need interactive elements in a survey so they feel theyre like talking to a real person

Respondents in Asia, on the other hand may feel more pressure to conform and may therefore not be as forthcoming in focus group as online

COLLECT THE INFORMATION

Sinergia, a well-respected market research firm, has been commissioned to conduct focus group relating to the launch of the Climp Easy Close garbage bag. The objective was to evaluate the acceptance of the new easy close (draw string feature) The focus groups were conducted on November 24-25, 1999, in the cities of Rio de Janeiro and Sao Paulo. Participants were selected from the A and B social class. Interviews were conducted on seven consecutive Saturdays, April June 1999 Additional consumer research was conducted in May June 2001 to evaluate how the findings of the marketing research they had commissioned would impact the launch of their new product

A total of 528 interviews were conducted, of which, 495 were considered valid

COLLECT THE INFORMATION

Quick Analysis :
Research Approach by using Focus Group is appropriate preference from Lazlo and Sved, seeing that focus group can be used to obtain feedback regarding a new product. In such manner, it can be measured whether the new product is potential enough or not. Then, the reseachers method to collect the information or feedback by contacting with the customers. This method is the most suitable method respectively the characteristic of Latin America people which like real interactive and kinship conversation Focus group participant selection is corresponding with the objective of focus group. Participant must be involved in household activities. That the participants were chosen from class A and class B, it is very reasonable considering these two classes accounted for 52% of the national consumption Additional consumer research by the way of individual interviews in test market was conducted in 2001, we think its necessary to re-evaluate performance of Climp Fecha Fecil

COLLECT THE INFORMATION

Focus Group Division

Sao Paulo House

Married women Ages 28-40

Sao Paulo Apartment

Married and single women

Rio de Janeiro Apartment

Mainly single & divorced women Ages 32-42 With or without children

Ages 28-39 With children Minimum of a high school education Some are univ. graduated & have professional career Most with a university degree Most are professionals with careers

High school education

Minority are professional women

COLLECT THE INFORMATION

Interview Guide for Garbage Bag Focus Groups

1. Warm-Up (5 minutes) 2. Habits (10 minutes) 3. Cleaning Material/Garbage Bag (30 minutes) 4. The Garbage and its Environement (10 minutes) 5. Market/Competition Knowledge (20 minutes) 6. Ideal Packages (10 minutes) 7. Analysis of the Proposed New Product (30 minutes) 8. Color (5 minutes) 9. Presentation of the Remaining Product Line (10 minutes) 10. End of the Sessions and Thank You
Total Duration of an interview approximately 130 minutes

COLLECT THE INFORMATION

Quick Analysis :

Participants were selected from among housewives by reason of housewives are highly involved in household activities, mainly about cleanliness Focus group participants were divided into three focus groups: Sao Paulo Apartment, Sao Paulo House dan Rio de Janeiro Apartment. The reason why group Rio de Janeiro Houses was not selected by the reasearchers, is probably theyre not included in the class A or B that was not subject to investigation Contents and composition of the question posed to the participants, we think, is in conformity with the purpose of focus group to evaluate the acceptance of new Climp Easy Close garbage bag. There is indication that the duration of interview was too long, must be overcome by ability of the interviewer to create comfortable environment

S TEP 4 A NALYZE T HE I NFORMATION

ANALYZE THE INFORMATION

Analyze the Information
The next-to-last step in the process is to extract findings by tabulating the data and developing summary measures. The researchers now compute averages and measures of dispersion for the major variables and apply some advanced statistical techniques and decision models in the hope of discovering additional findings. They may test different hypotheses and theories, applying sensitivity analysis to test assumptions and the strength of the conclusions (Kotler-Keller)

ANALYZE THE INFORMATION

Analyze the Informationcontd
FACT :
Black is good! The thickness of the black is better, you cant see the garbage, *the black bag] is more resistant (house - SP)

When its time to close the bag its horrible. It has that handle, its horrible when you tie a stronger knot [and] it breaks The handle should be stronger (apartment- Rio) Independence from the price, I would buy it, I [would] like to try [it] The package gives the impression [that] the bag [is] better, from the packaging that [it] comes in, we have the idea that [it] is pretty [resilient], and that is not what it feels like (house - SP)

ANALYZE THE INFORMATION

Analyze the Informationcontd
FACT :
No 1 2 3

The summary of interviewees answers

Issue Lifestyle Purchasing in Supermarket Sao Paulo (House) didn't take care themselves phisically Sao Paulo (Apartment) didn't take care themselves phisically Rio de J.(Apartment) took care themselves physically husband or boyfriend more involved in purchasing decision

influence in purchasing

4 5
6 7 8 9 10 11

12

Color Color Perception Using of Supermarket Plastic Bags Brand Image No Size 20/30/40/50/60/100L The Importance of strong Yes garbage bags The price was cited in purchasing decision The importance of Strong YES Drawstring Main Factors in Resilient, Capacity, Price Pruchasing

- Practicality Price, Practicality and quality Price, Practicality and quality - Advertisement Black Blue (black is rare) Blue More Durable, Stronger More Durable, Stronger No relation Higher No 20/30/40/50/60/100L Yes Yes YES Lower Yes (Dover Roll) 15/30/50L Yes No YES

Resilient, Capacity, Price

Resilient, Capacity

ANALYZE THE INFORMATION

Analyze the Informationcontd
Analysis:
The result of the interview shows aspects that motivated consumers in choosing Climp Fecha Fecil. Practicality is first and quality come second. The result shows also weakness of Climp Fecha Fecil compared with other products with the results, the company should be able to create a strategy to make this product as a superior product Decisions of Pricing, product size and distribution decision, with complete data available, unfortunately not presented by researchers.

S TEP 5 P RESENT

THE

F INDINGS

PRESENT THE FINDINGS

Presents findings relevant to the major marketing decisions facing management Being asked to play a more proactive, consulting role in translating data and information into insights and recommendations Considering ways to present research findings in as understandable and compelling a fashion as possible

PRESENT THE FINDINGS

Ideal garbage bag would need to be something easy to close, resilient, with a different color from the others (opaque and not too clear)

In Sao Paulo, in both groups (apartement and house), an efficient closing system was expected, especially to the house group who often use 100L garbage bag. In Rio, color and resilience came before the closing attribute. Because they used to utilized the Dover Roll brand that already have a closing system. The closing of the bag. Its easy to close, not let it leak, and to be able to carry. Other advantages : can be used to storing of sheets, shoes, dirty clothes, towels, books, or clothes that they dont use anynore. And better, it can be hung.

S TEP 6 M AKE D ECISION

MAKE DECISION

Management making decision based on the result of marketing research. They may even decide to study the issues further and do more research. The decision is theirs, but rigorously done research provides them with insight into the problem.

MAKE DECISION

After conducting FGD on 24-25 November 1999 in two major cities of Brazil, Sao Paulo and Rio de Janeiro, the company has obtained the data they need to determine next steps, ie decision
making on pricing,

product size, color, package and distribution,

according to their initial goal in doing marketing research.

MAKE DECISION

Pricing, confident to put price higher than the

competetitor (market leader) Product size, from the analysis of the habits of respondents who revealed during FGD, data size trash bag whichever is more widely used by respondents Preferences, prefer the blue color rather than black) and packaging in the form of roll Distribution, Climp compete with other brand because of practicability , so that it could be sale on the same store of other product

CONCLUSIONS

From the result of test market, theyve had data to further analysis and make decision about what promotion strategy they will use.
Marketing research is never ending study as long as the product / brand is still exist. Thats why they were going over the market research one more time.