Booster juice final presentation
- 1. BOOSTER JUICE: BRINGING CANADIAN SMOOTHIES TO THE INDIAN MARKET Group 4 Jasmine Wang Leasy Li Abdullah Bin Gubair Abdul Aziz Alsayed Kai Haverila
- 2. Inspired by juice bars in the US Nov.13th,1999, Dale Wishewan started the first Booster Juice in Sherwood Park, Edmonton. First mover in Canada Grow the business by franchising Healthy product offering & mass customization 11 “Boosters” & 38 varieties of beverages for its menu International expansion Successfully entered Saudi Arabia in 2004 Further expanded to Netherlands, US, Mexico, Brazil, and UK. Challenges in Indian Market INTRODUCTION TO
- 3. Q1: WHY IS BOOSTER JUICE NOT ACHIEVING GREATER SUCCESS IN INDIA? Inefficient use of some of the 4 P’s Place/Location Challenge: People from all socioeconomic classes living together. Difficulty in choosing the right location for the target market. Unsuccessful initial location decisions- relocation expenses $35,000. Price Challenge: Not many Indians can afford the premium prices of Booster Juice.
- 4. Q1: CONTINUED Products: Booster Juice offers product in different sizes Large, medium, and small Indian Market Strategy: Only offer medium and small sizes at lower prices. Customer service: Workers are not interactive with customers. Result: Customers not realizing the products and their prices.
- 5. Q1: CONTINUED Supply Chain Management: Not finding the required local suppliers in terms of quality. Had to import products from Canada – Extra Costs. Delays due to importing processes. Indirect competition from local cart juice vendors.
- 6. Q2: ANALYZE INDIAN’S BUSINESS ENVIRONMENT. PESTEL ANALYSIS Political Environment • Largest democracies in the world • Runs on federal government • Greatly influenced by the government policies • Influenced by politician’s interests as well as the ideologies of political parties. Economic Environment • 4th largest buying power • Rapidly growing middle class • GDP is about 7.46 billion dollar and estimated to grow to 7.75 by 2020 Social Environment • Population of 1.2 billion • Consists of 28 states and 7 territories • Complex social structure • Diverse cultures, religions and languages
- 7. Q2: PESTEL ANALYSIS CONT’D Technological Environment • One of the strongest IT infrastructure in the world • Served both 3G and 4G • Technology is widely used • Technological support and services are easily available Environmental • Poor air quality • Presence of environmental pressure groups • Early stages of recycling and waste material reduction process Legal Environment • Regulations such as minimum wage and gender discrimination
- 8. Q2: PORTER’S FIVE FORCES • Many substitutes • Lower prices • Low switching costs. • Low loyalty. • Low barriers to entry. • Easy to enter the market with cheaper prices. • Many suppliers in India. • Low switching cost. Power of Suppliers: Low Threats of New Entrants: High Threats of Substitutes: High Power of Buyers: High Intensity of Rivalry: Low
- 9. Q2: CONCLUSION The Indian market/industry is attractive. Requires careful analysis before entry.
- 10. Q3: IDENTIFY MARKET SEGMENTS AND CUSTOMERS FOR BOOSTER JUICE’S PRODUCTS Market Segmentation Identifying unique consumer groups with distinct purchasing habits and behaviors Demographics Geography Sociocultural Psychological
- 11. Q3: KEY ATTRIBUTES Main market segment Health conscious Males and Females Healthy, great-tasting and convenient alternative Meal replacement Fast-paced lifestyle Health-oriented Busy Active
- 12. Q3: KIDS AND FAMILY Significant purchasing power Fantastic opportunity Healthy products Boost Energy Little to no negative connotations with marketing to kids How to do this? School lunch programs School fundraisers Target families May entice them to try Booster Juice products
- 13. Q3: EXERCISING AND ATHLETIC MARKET Could be used as a workout snack or a post-workout meal Celebrity endorsements José Bautista in Canada Cricket stars in India? E.g. Sachin Tendulkar Positive associations
- 14. Q3: MIDDLE AND UPPER CLASS PRODUCT Higher prices due to differentiating features Higher Fruit Content Lower Ice Content No Added Sugars or Preservatives Free Nutritional Supplement or ‘Booster’ Using ‘superfoods’ like Goji and Açaí berries
- 15. Q3: INDIAN MARKET Target market Young, health-conscious consumers Aged 18 to 35 Main selling point Offering a healthy, portable meal Convenience Premium Product Targeting upper and middle classes
- 16. Q3: NICHE MARKETS Appeal to wide variety of niche segments People with nut allergies Juices and Smoothies with no sorbet and Boosters People who cannot consume gluten Most products are gluten-free Pregnant women E.g. Go Girl and Fibre Boosters Diabetics Whey and Hardcore Smoothies Vegetarians and Vegans
- 17. Q3: NICHE MARKETS AND ADDED BENEFITS Through their ‘Boosters’ Protein and Power Boosters Athletes: Protein and Creatine supplements Warrior and Energy Boosters People feeling ill: Fighting colds and boosting immunity Boogle Booster People wanting energy boost: Increases mental functions Go Girl, Fibre, Combo and Wilderness Booster People wanting healthy snack: Calcium, fiber, multivitamin supplements and antioxidants
- 18. Q4: WHAT WOULD HAVE BEEN THE OPTIMAL ENTRY STRATEGY FOR BOOSTER JUICE IN INDIA IN 2009? • Franchising strategy was the best entry strategy to enter the Indian market • Control the operations in India • Point-of-sale (POS) system • Facilitates and helps to manage the difficulties of doing business in India • Fazel Naqvi, the master franchisor: 1. Well connected in the Indian retail industry 2. Knew the wave of demand for healthy snack foods and 3. Had the knowledge of doing business in India
- 19. Joint Venture • Booster Juice business type is not suitable for a joint venture • Lack of control • Lack of trust Licensing • Lack of control • Can become a competitor after license expires Exporting • High transportation costs. • Perishable good • Less control over Marketing & Distribution Wholly Owned Subsidiaries • High cost • Complex social structure. • Diverse cultures, religions and languages. WHY NOT ?
- 20. Q5: WHAT WOULD BE THE PERFECT MARKETING MIX FOR BOOSTER JUICE IN INDIA? Step 1: Identify the current stage in the product life-cycle Growth stage Step 2: Identify marketing objective Increasing market share Step 3: Identify the perfect marketing mix for Booster Juice in India according to the current product life-cycle and marketing objective Product Pricing Place Promotion
- 21. Q5: PRODUCT Make full use of “POS” system to Eliminate “Dogs” Turn “Question Marks” and “Stars” into “Cash Cows” Keep creating new products and observe consumers’ reactions. Continuously take in consumers’ ideas. Keep monitoring the quality and inventory level of the “Cash Cows” Publicize the fact about “polystyrene cups”.
- 22. Q5: PRICING
- 23. Q5: PRICING
- 24. Q5: PRICING 139 Rupee = 2.8 CAD, 4.75 CAD-2.8 CAD=1.95 CAD
- 25. Q5: PRICING Recommendations: Keep their current pricing strategy unchanged. Increase market share. Take advantage of home-grown resources in India. Take advantage of low fixed costs, devote more into employee development. Strive to achieve “more for even more” in product position by providing superior service. Occasionally downscale the price by offering bundle prices or discount prices.
- 26. Q5: PLACE Health-oriented, busy and active consumers Commercial areas Children and families Affluent neighbors Athletic consumers Gymnasiums Also consider to cooperate with major cinemas.
- 27. Q5: PROMOTION Butterflies Short-term customers with high potential of profitability. Cease investing in them until the next time around. True Friends Long-term customers with high profitability. Free advertisements. Maintain a good relationship with them. Barnacles Long-term customers with low profitability . Potential threat. Do everything possible to satisfy them.
- 28. Q5: PROMOTION Recommendations: Create some festival events according to Indian culture. Involve local celebrities in their advertisements. Create campaigns through social media. Form strategic alliance with competitors. Hire a manager with high education level and social status in each store. Membership cards and coupons for cinemas. Sponsor for athletic competitions in India. Get involved in Indian social welfare activities.
- 29. Q6: SHOULD BOOSTER JUICE FOLLOW MCDONALD’S STRATEGY BY “INDIAN-IZING” ITS STRATEGY? ● Should not completely copy McDonald’s strategy. Pure Localization Strategy ● Do need certain level of localization. Pure Global / Standardization Strategy ● Find a Balance Transnational Strategy
- 30. Q6: WHY NOT PURE LOCALIZATION? ● Similar tastes & preferences ● Different situations faced by McDonald’s and Booster Juice ● Similar target consumer ● Transferable marketing efforts ● Relative high pressure for cost reduction ● Potential to increase material costs ● Potential to increase R&D costs ● Potential to increase labour costs
- 31. Q6: WHY NOT PURE LOCALIZATION? ● Longer experience curve ● Lack of slack resources ● Consistency of brand image & Country of origin effect
- 32. CONCLUSION Find a balance between over-globalization & under-globalization Effective and efficient transnational strategy Successful expansion into India – one of the most popular emerging markets in the world
- 33. FURTHER RECOMMENDATIONS ● Build integrated value chain ● Creative promotion ● Retained earnings for international promotion activities ● Be consistent with “premium” brand image ● Continuous innovation
- 34. Thank you for listening! Any Questions?