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Submitted by:
Anuj Goyal 2010276 Nitin Sardana 2010205 Sakshi Agarwal 2010206 Shourjo Sengupta 2010219 Sreechand Nambiar 2010230
Submitted to:
Prof. Rajeev Kamble
Table of Contents
Introduction ............................................................................................................................................ 3 Brand Strategy The India Strategy ....................................................................................................... 4 Product Strategy ..................................................................................................................................... 6 Analysis of the Product Strategy ......................................................................................................... 8 Price Strategy ........................................................................................................................................ 10 Analysis of the Price Strategy............................................................................................................ 11 Place (Distribution) Strategy ................................................................................................................. 13 Analysis of the Place Strategy ........................................................................................................... 14 Promotion Strategy ............................................................................................................................... 15 Analysis of the Promotion Strategy .................................................................................................. 16 Summary ............................................................................................................................................... 17 References ............................................................................................................................................ 18 Annexures ............................................................................................................................................. 19 Exhibit 1: ........................................................................................................................................... 19 Exhibit 2: ........................................................................................................................................... 20
Introduction
Perfetti Van Melle is a European global manufacturer of confectionery and gum. It was formed by the 2001 merger of Perfetti of Italy with Van Melle of the Netherlands, having its corporate headquarters in Lainate (Milan), Italy and in Breda, Netherlands. Perfetti Van Melle bills itself as the third largest confectionery manufacturer in the world after Kraft Foods (owners of Cadbury plc) and Mars, Incorporated (owners of Wrigley). It employs 17,000 people via 30 subsidiary companies and distributes its products in over 130 countries. Perfetti Van Melle India (PVMI), a fully owned subsidiary of the global conglomerate Perfetti Van Melle, started its Indian operations in 1994. The company today enjoys close to 30% market share, thus making them one of the leading players in the confectionery industry in India today. Perfetti Van Melle entered the Indian market in 1994 by offering its first brand Center Fresh, followed by Big Babol and Alpenliebe in 1995. The other brands like Chlormint, Mentos, Fruittella, Cofitos, Happydent and Marbels followed subsequently, which will be explained in detail later under the companys product strategy. PVMI enjoys a huge brand recall among its consumers which form a total estimated market size of Rs.3000 cr. Special care has been taken by the decision makers at Perfetti to make sure they consider all the aspects which will help them to understand what the Indian consumer likes. The products had to be adapted according to the Indian climate like increase in the shelf life and the composition of the product. Perfetti Van Melle has adopted an aggressive sales strategy to retain the market leader position in the confectionery industry in India backed by a wide network of Carry & Forwarding agent (C&FA), distributors & sales force. Another striking feature of this company is that in India alone it has a network of around 4,500 distributors spread across 2000 urban towns. Also, the advertising strategy followed by PVMI has managed to capture the attention of the Indian audience. Now lets take a look at the brand strategy followed by PVM in India.
Product Strategy
Perfetti Van Melle has several mouth-watering and heavy-selling candies as a part of their product portfolio. The various brands that are currently available in the Indian market are discussed below: Alpenliebe Alpenliebe is the flagship brand of Perfetti and a leader in the confectionary market. A milk-caramel toffee, the Alpenliebe brand banks on the irresistibility factor wherein the texture and taste that it offers is like none other. Even the tag-line Lalach aha LapLap, focuses exactly on this quality of the toffee. Launched in India in December 1995, in its original caramel toffee form, Alpenliebe is now available in three three variants Lollipops, Mangofillz and Creamfills. Moreover, other than the Caramel flavour, Alpenliebe is currently available in Cream Strawberry, Chocolate, Coffee and Cream Banana flavours and Alpenliebe Lollipops is available in Rich Milky Caramel, Cream Strawberry and Cola Vanilla flavours. Alpenliebe Creamfills comes in the usual caramel flavour and it has an extension called Xtra a larger candy in the filled format. Xtra comes in to other flavours Coffee and Mango. Alpenliebe Mangofillz is the companys new proposition under the Alpenliebe umbrella and is a candy with liquid Mango flavoured filling inside. Mangofillz is the first non-cream Alpenliebe candy and Perfettis first foray into the sizeable candy category of virgin fruits at the same time. Big Babol Big Babol, launched in India in 1994, is one of the biggest bubblegum brands in the country. It is currently available in two flavours Fruit and Ripe Mango. Big Babol is known for its taste and the bigger size bubbles that can be blown out of it. It also comes with the added advantage that the bubblegum does not stick to consumers face. Center Fresh Center Fresh, Perfettis flagship brand, was the first product to be launched by the company in India in 1994. Center Fresh has grown to become the largest selling gum brand in India and is a household name today. Center Fresh was a first of a kind liquid filled chewing gum. It is currently available in Spearmint, Peppermint and Sweet Mint flavours. In 2006, Perfetti came out with Center Fruit, Indias first-ever fruit-flavoured liquid-filled gum. It was launched with two flavours Tutti Fruity and Grape. Presently, there are three more flavours available in the market namely Peach, Strawberry and Watermelon.
Price Strategy
For all we know, Perfetti has been following the simplest of pricing strategies. Most of its products are available in the market at two basic price points, i.e. 50 paisa for a mono pack, which has a single tablet and Re. 1 for brands like Center Fresh, etc. The prices of different products do not vary from region to region, i.e. the part of the country they are being sold in, they are same throughout. But almost all of the products are available in different kinds of packaging. Heres a look at some of the products the company offers: Mentos Earlier, when it was launched in the Indian market, it was available at Re 1 per unit, but now, looking at the demand and the preferences of the customer, the price has been brought down to 50p per unit. There is another SKU that is widely available across the stores is a stick of 10 pieces, which costs Rs 5.
Center Fresh Earlier it was available for Rs 1.5 per unit for several years, which included a huge profit margin, but then it was reduced to Re1. It is also available in the form of a stick, which has 5 pieces for Rs. 5.
Big Babol In the case of Big Babol, the same pricing strategy was followed as in the case of Center Fresh.
PRICING MATRIX Perfetti lies in the Top Left portion, i.e. ECONOMY
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Happydent (4 Variants) The cheapest unit for this product is available at Re 1 per unit and each unit consists of two tablets. There is also a small plastic packing available for Rs 10, which has 22 tablets. Then there is a bar available for Rs 5, which has 10 tablets.
Center Fruit (3 Variants) This is available at Re 1 per unit. The bigger jar has not been introduced by the company yet, though a medium sized jar is available for the retailers to buy. It comes at Rs 120 and contains 120 pieces.
Pefetti, very clearly lies in category D, where they produce their products for the mass customer base at a very low price, hence aiming at high market share. They have been able to achieve their target in almost 16 years and their pricing strategy has been a very important part of their campaign in India. But now, the only problem we believe they face is that of stagnation. Due to the pricing that they have been following, they cannot introduce a new product at a higher price, and hence limits their scope of R & D and trying out newer products which might actually be good. The problem is that now the customer has a fixed mindset about the Brand, and if the company introduces little costlier product, say at Rs 5 per unit, the customer might think twice before buying it as he would be skeptical due to the price, and this did happen with the company, when they introduced the Alpenliebe Lollipop in two flavours at Rs 4 per unit, it failed very badly, despite the product being very good.
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Promotion Strategy
To consolidate its worldwide market presence, Perfetti Van Melle has always paid special attention to advertising, in terms of investments and creativity, as they both play a vital role in the creation of a product's distinctive personality and market positioning. For Perfetti Van Melle, advertising is not simply means to access; it is one of the most important parts of strategic development. Television, radio, press, Internet; Perfetti Van Melle has in depth knowledge of the contemporary media, effectively differentiating their use according to their specific target groups, as well as customs and conditions in each particular country. Perfetti has a large portfolio of 16 brands. Of these, it has decided to actively promote ten: Center Fresh, Center Fruit, Big Babol, Happydent, Alpenliebe, Creamfills, Chlormint, Chocoliebe, Mentos and Marbels. These ten fetch the company almost 80 per cent of its sales revenue. The promotion strategy adopted by Perfetti can be divided into four major sub-divisions: Advertising Sales Promotion Events and Experiences
Advertising Innovative advertising is the only way to create brand salience, given the clutter in the Confectionary market. Like in other FMCG categories, large confectioners spend 12 to 13 percent of their revenues on advertising. Perfetti spends close to 15 crore on its advertising campaigns. Perfetti puts humour (Mentos and Center Fresh), emotion (Alpenliebe), bizarreness (Happydent and Chlormint) and fun in liberal measures in all its commercials. They use generic tagline for its products which suits the Indian scenario and catch the customer mind. Thus, there is Zubaan par rakhe lagaam for Center Fresh, Dobara mat puchna for Chlormint and Dimag ki batti jala de for Mentos. Perfetti have also roped in Kajol as a brand ambassador for Alpenliebe and Salman and Sohail Khan as brand ambassadors for Chlormint. Perfetti has also come up with the innovative idea of promoting its brands through animated films. It has entered into a tie-up with Cartoon Network to place its Center Fruit brand in the storyline of Balla Bowl. While brand placements in movies, television programmes and gaming is fairly big in India, the trend of using comics, toys and animated videos or films as vehicles is just beginning to take shape. While the promotions for Mentos had been predominantly TV-led, Perfetti also used newer media such as the Internet. In doing so, it became one of the first companies in India to start major online initiatives for its brands. Sales Promotion
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Summary
Perfettiss journey in India has been very fruitful and the strategies used have set benchmarks for the confectionery industry. From children to the common man, PVM has managed to capture the attention of the Indian consumer. From our groups point of view, we feel Perfetti has taken keen interest in understanding the India which has resulted in them achieving the market leader status with more than 30% share. But we can see that some influence has been there of the global strategies in Perfettis way of promotions. Hence a future change that Perfetti could bring about would be to introduce a premium brand which would stand out from the cluster of products that are there in the market right now. Innovation in products is not a new thing for Perfetti and combined with an exceptional marketing strategy, we think another benchmark can be set by this company. With Indias economic boom and the changing mindset of its consumers, Perfetti should try to maximize its profits as much as possible so that they can achieve the desired lead over the competition. In India, the company now strives to change the face and nature of the confectionery industry. It aspires to shift it away from the unorganised segment, which is dominated by low quality and unhygienic products, to a more competitive and organised scenario, dominated by high quality manufacturing, innovative advertising and widespread distribution extending even to small towns and villages. As they say, living the Perfetti Van Melle Values requires courage, vision, trust, commitment and pragmatism.
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References
http://www.perfettivanmelle.in http://en.wikipedia.org/wiki/Perfetti_Van_Melle http://www.perfettivanmelle.com/about_glance.htm http://ibef.org/download/perfettivan_melle_india.pdf http://www.scribd.com/doc/22960002/%E2%80%A2-%E2%80%A2-%E2%80%A2-%E2%80%A2%E2%80%A2-Rahul-Joshi-Pooja-Gaikwad-Roopali
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Annexures
Exhibit 1:
Brands launched by Perfetti n India: Alpenliebe Alpenliebe Creamfills Alpenliebe Lollipop Big Babol Center Fresh Center Fruit Center Shock Chatar Patar Chlor-mint Chocotella Cofitos Fruitella Happydent White Protex Happydent Marbels Mentos Chocoliebe
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