Segmentation, targeting and positioning strategy for HAFER
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HAFER is developing a marketing strategy for its new Oat Bran Flakes product. The strategy involves segmenting customers based on geographic, demographic, psychographic, and behavioral factors. The target market will be a concentrated strategy focusing on working couples and kids. HAFER will position the product as both "sweet and healthy" to appeal to kids' tastes but also promote adult health benefits. Communication of these strategies both internally and externally will be key to the product's success.
Segmentation, targeting and positioning strategy for HAFER
- 1. HAFER Group 6 Marketing Management DAJAL Marketing Management Project Segmentation, Targeting and Positioning strategy for HAFER Group 6 Ankit Uttam Ayush Anjali Chauhan Jaskaran Divya Marvah Lizzie Jerin George
- 2. HAFER Group 6 Marketing Management DAJAL Introduction DAJAL is a Global Company Committed to Building Long-Term Growth in Volume and Profit and to Enhancing its Worldwide Leadership Position by providing Nutritious Food Products of Superior Value” VALUES Accountability – we feel ownership for driving results Integrity – we act with the highest ethical behaviour Pragmatism – we are practical and action oriented Collaboration – we encourage openness and candour People – we foster a culture of engagement and passion to excel DAJAL bets on innovation and growing demand to see off increasing competition on the breakfast table. Multinationals DAJAL, PepsiCo's Quaker, GlaxoSmithKline, Nestle and Dr Oetker, and large domestic food companies Marico, Britannia, ITC Foods, Bagrrys and MTR Foods are all now fighting for a pie of the Rs 2,000-crore breakfast category, which includes oats, cornflakes, muesli, dalia and mixes of traditional breakfast like idli and upma. Product HAFER-Oat Bran Flakes Company: DAJAL International corporation
- 3. HAFER Group 6 Marketing Management DAJAL STP In marketing, STP stands for market segmentation, targeting (or target market selection) and product positioning. Most marketing textbooks will show the STP as three broad steps. In the following diagram, the three foundation stages of segmentation, targeting and positioning Segmentation It means grouping consumers by some criteria, such that those within a group will respond similarly to a marketing action and those in a different group will respond differently. Geographical Metro Size: The product segmentation for our product will be based on Metro and the future growth prospect of it. Climate: HAFER-Oat bran flakes have long shelf life. Also there are no specific storage issues with this product as far as the climate is concerned. Geogrpahical Metro Size Climate Demographic Age Income Occupation Psychographic Social class Lifestyle Personality Behavioural Benefit Loyalty Status
- 4. HAFER Group 6 Marketing Management DAJAL Demographic Age: The consumers are segmented based on the ages, e.g., Kids, Working couple and Old people. Income: The customers are mainly segmented into two groups; middle class and affluent. Occupation: The occupation based segmentation is done job profiles of the working couple and their needs of high fibre and nutritious breakfast. Psychological Social Class: The customers mainly people with high social index and aspirations Lifestyle: The lifestyle based segmentation is yields customers that believe in fast and efficient life and hence crave for a synonymous breakfast alternative Personality: The customers are independent and high self worth people. Behavioural Benefits: The benefits are health benefits and fast preparation. Loyalty Status: The customers that are not much loyal to other brands and looks for new alternatives. Targeting Strategy After the most attractive segments are selected, a company should not directly start targeting all these segments -- other important factors come into play in defining a target market. Four sub activities form the basis for deciding on which segments will actually be targeted. Out of Differentiated, Concentrated and Undifferentiated Strategy our targeting strategy will be concentrated strategy since HAFER-Oat Bran Flakes is for a niche group of customers and by using this strategy we will be able to target working couples and growing kids.
- 5. HAFER Group 6 Marketing Management DAJAL Positioning: When the list of target markets is made, a company might want to start on deciding on a good marketing mix directly. But an important step before developing the marketing mix is deciding on how to create an identity or image of the product in the mind of the customer. Every segment is different from the others, so different customers with different ideas of what they expect from the product We will position the product with the tagline “SWEALTH WAY OF LIFE” i.e. sweet and healthy. The HAFER-Oat bran flakes will be a sweet for the kids as they like sweet stuff but this stuff is healthy which would be beneficial to their health. For the adults, the benefits of this particular brand outweigh the benefits offered by other cereals in the market. This in turn would sway the customers from the regular brands to HAFER-Oat bran flakes and even small kids and teenagers would like it and ask their parents to buy them HAFER-Oat bran flakes Further the only competitor in the market is Baggry's whose oats are not tasteful which would also position our product as tasty
- 6. HAFER Group 6 Marketing Management DAJAL Product Benefits: Benefits of Oat Bran Every Time You Add Oats to your Diet, It may help in improving your Health Oat is a whole grain like wheat, barley, corn and is called “jai” or “javi” in Hindi. Oat is natural and one of the superior sources of fibre. It is a heart friendly grain, containing Zero Cholesterol and Zero Trans fatty Acids Heart Friendly Oats As a part of healthy lifestyle, 3g of soluble fibre daily from oats in diet low in Saturated fat and cholesterol may reduce the risk of heart disease. Source: US FDA Oats and Weight Management Oats are good source of dietary fibre. Research shows that high intake of dietary fibre may help in weight management DAJAL Marketing Strategy for HAFER-Oat Bran Flakes Well-constructed objectives are SMART objectives. They must be: Specific Measurable Achievable or Agreed Realistic Time-related.
- 7. HAFER Group 6 Marketing Management DAJAL Each of the objectives set by DAJAL is clear, specific and measurable. The objectives were considered to be achievable and were communicated to all staff. This made sure that all staff agreed to follow certain actions to achieve the stated aims. The objectives were set over a realistic time-period of three years. By setting these objectives DAJAL set a direction that would take the business to where it wanted to be three years into the future. Marketing Strategy Having created an aim and set objectives, DAJAL put in place a process of planning to develop a strategy and a series of actions. These activities were designed to meet the stated aim and range of business objectives. 1. Supporting improved food labelling In the area of food labelling, DAJAL introduced the DAJAL GDAs to its packaging, showing the recommended Guideline Daily Amounts. These GDAs allow consumers to understand what amount of the recommended daily levels of nutrients is in a serving of DAJAL food. 2. Sponsoring swimming programmes For many years DAJAL has been working to encourage people to take part in more physical activity. The company started working with the Swimming Federation of India (SFI) as far back as 1997, with whom it set some longer term objectives. More than twelve million people in the India swim regularly.
- 8. HAFER Group 6 Marketing Management DAJAL DAJAL plans to become the main sponsor of swimming in India. This ensured that DAJAL sponsorship reached all swimming associations so that swimmers receive the best possible support. DAJAL sponsors the SFI Awards Scheme with more than 1.8 million awards presented to swimmers each year. This relationship with the SFI has helped DAJAL contribute in a recognisable way to how individuals achieve an active healthy balanced lifestyle. This reinforces its brand position. Promoting exercise Working with the SFI helped DAJAL set up links with a number of other bodies and partners. For example, Hero is the India's leading sustainable transport organisation. Hero looks at the different ways that individuals can meet their transport needs in a way that reduces environmental impact. It is the co-ordinator of the National Cycle Network. This provides more than 10,000 miles of walking and cycle routes on traffic-free paths throughout the India. To meet its business objective of encouraging and supporting physical activity DAJAL is developing a promotion for a free cyclometer which will be advertised on television in 2014. Walking is one of the easiest ways for people to look after themselves and improve their health. To encourage people to walk more often, DAJAL has supplied a free pedometer through an offer on All-Bran so that individuals can measure their daily steps. During 2013 more than 675,000 pedometers were claimed by consumers. From a research sample of 970 consumers, around 70% said they used the pedometer to help them walk further. DAJAL Corn Flakes Great Walk 2012 raised more than £1 million pounds for charity on its way from Mumbai’s Gateway of India.
- 9. HAFER Group 6 Marketing Management DAJAL STRATEGY 2 Communicating the strategy Effective communication is vital for any strategy to be successful. DAJAL success is due to how well it communicated its objectives to consumers to help them consider how to 'Get the Balance Right'. It developed different forms of communication to convey the message 'eat to be fit' to all its customers. External communication External communication takes place between an organisation and the outside world. As a large organisation, DAJAL uses many different forms of communication with its customers. The company has also produced a series of leaflets for its customers on topics such as eating for health and calcium for strong bones. These are available on its website. Internal communication Internal communication takes place within an organisation. DAJAL uses many different ways to communicate with its employees. For example, DAJAL produces a house magazine which is distributed to everybody working for DAJAL. The magazine includes articles on issues such as getting the balance of food and exercise right. It also highlights the work that DAJAL has undertaken within sport and the community. To encourage its employees to do more walking, DAJAL supplied each of its staff with a pedometer. Such activities have helped DAJAL employees to understand the business objectives and why the business has created them. It also shows clearly what it has done to achieve them. Research undertaken by DAJAL as part of the 2013 Family Health Study emphasised that a balanced diet as well as regular exercise were essential for good all round health and wellbeing.
- 10. HAFER Group 6 Marketing Management DAJAL DAJAL is demonstrating good corporate responsibility by promoting and communicating this message whenever it can and by investing money in the appropriate activities. This was the broad aim. To achieve this aim, DAJAL set out measurable objectives. It developed a business strategy that engaged DAJAL in a series of activities and relationships with other organisations. The key was not just to create a message about a balanced lifestyle for its consumers. It was also to set up activities that helped them achieve this lifestyle. FUTURE TRENDS In a rapidly changing and competitive business environment, it is not easy to predict: Future trends in consumer tastes and preferences Competitors' actions Market conditions. Brand managers aim to develop a long-term strategy to meet a range of objectives such as: Growing market share Developing a unique market position Creating consumer or brand loyalty Generating a targeted level of profit. Competitors: Major publicly-traded competitors of DAJAL include Baggrys and Kellogs. TRENDS IN OATS SEGMENT INDIAN BREAKFAST FOODS MARKET SCENARIO According to reliable market research analysts, the Indian branded breakfast foods market is now estimated at around $A100 million approximately. In volume terms the total market size for all breakfast foods put together is in the vicinity of 14,000 tonnes of which rolled oats account for 4,000 tonnes per annum. The market for oats
- 11. HAFER Group 6 Marketing Management DAJAL alone accounts for more than 30% in volume and 18% in value next only to corn flakes (which represents nearly 60 % of the total demand). The Indian breakfast market assumes significance because of growing “health consciousness”,especially amongst the Indian middle classes in excess of 330 million. DOMESTIC DEMAND According to reliable market analysts, annual demand for imported oats by the breakfast foods manufacturing industry ranges from 4,000 to 5,000 tonnes Local production up in the Himalayan ranges in India and Bhutan is insignificant and is predominantly used as a cattle fodder in that region. As a result, India imports oats from Australia and other sources to meet the entire requirements of the breakfast foods manufacturing segment. Demand projections are expected to far exceed the current annual growth rate of over ten percent during the last two years in tandem with the Indian economic growth. According to a major Indian market player –BAGRRYS –the oats market growth has been phenomenal and rapid because of perceived health benefits. Beta glucan found only in oats helps lower cholesterol and blood pressure. It also helps diabetics by lowering post meals glucose levels. With the increasing spread of diabetic and coronary diseases in India, oats is a category expected to record rapid growth rates in the years to come as the Indian consumers get increasingly health conscious with improvement in living standards. It is not a niche category any longer. Although pricing is a factor, this category is now witnessing a dynamic and positive growth. Based on statistical data, based on the Indian Ministry of Commerce oats imports into India from various sources of supply are: April 2012/March 2012 April 2013/ March 2013 Country of origin Total Quantity imported (tonnes) Value of imports. (in US $ million) Total quantity imported. ( in tonnes) Value of imports ( US $Million) Australia 2978 2.04 5781 2.61 Germany 25 .02
- 12. HAFER Group 6 Marketing Management DAJAL UAE 11 UK 10 11 USA 1 Total 3000 2.05 5817 2.64 INDIAN CONSUMER BASE India is now undergoing significant demographic and socio-economic shifts which are transforming the makeup and nature of its consumer base. India has not only the second largest population next to China in the world but also one of the youngest. It is estimated that 56 %of the population is less than 25 years of age and only 13 %above 50 years. Almost one- quarter of the population is between 20-34 years. . CONSUMER CLASSES BASED ON INCOME The Indian consumer market can be divided into four classes based on household income. They vary in size and their different characteristics will impact on the growth and preferences of each class. Consumer Class Very rich. Less than 2% of households. Mainly work in large metros as senior professionals in Government and private sector companies Live in big houses or apartments and own cars, computers (including Laptops), and colour television similar to western counterparts. Large disposable incomes. Geographic spread and small group make them rather difficult for retailers to profitably target. Middle Class Just under 25 % of households. Mainly graduates who are now middle managers or small business owners. Live in apartments and own colour television sets, computers, refrigerators, washing machines, telephones, mobiles, motorized two wheelers or small cars. Enjoy shopping in modern retail outlets with their families although loyal to their neighbourhood stores.
- 13. HAFER Group 6 Marketing Management DAJAL Aspiring middle class About 40 %of households. Occupations include shop workers and farmers. Live in small apartments. About half own colour television sets and their own refrigerators and telephones. Very price conscious and shop in traditional, retail outlets or quasi super markets. poor Above 40 %of households mainly rural and farmers Shops in traditional wet markets and neighbourhood stores. Low disposable income.