Assignment

Subject: Marketing Management

NAME: COURSE: YEAR AND DEPARTMENT: BATCH CODE/YEAR:

TABLE OF CONTENTS

1. Introduction 1.1Company Profile 1.2Situational Analysis 1.2.1 External Analysis 1.2.2 Internal Analysis 1.2.3 SWOT Analysis

2. Marketing Objectives 2.1Product Brief 2.2Marketing Objectives

3. Marketing Plan 3.1Target Market 3.2Positioning and Differentiation 3.3Marketing Mix

4. Marketing Budget

5. Conclusion

References

1. Introduction
1.1Company Profile
The origin of the company dates back to 1903 when J.L. Kraft started selling cheese from a horse drawn wagon. Today the company has expanded its operations in more than 170 countries, marketing its diversified portfolio of biscuits, confectionary, beverages, cheese, grocery products and convenient meals. Krafts Food Inc had revenue of $49.2 billion dollar and is growing. More than 70 of its brands earn $100 million in revenue and over 40 of its brands are 100 years old. (Cadbury India Ltd, 2011) We will consider India as the region for the assignment. In India, Cadbury began its operations in 1948. Cadbury India Ltd. Operates in 5 categories chocolate confectionary, beverages, biscuits, gum and candy. It currently has a market share of 70%.
1.2

Situation Analysis

Situational Analysis deals with analysing the marketing environment. We can define Marketing Environment as a set of conditions or factors which influence the working of an organization. These conditions may be in varied forms social, economic, technological, political, cultural and so on. (Kotler, P., Armstrong, G., 2004)

Fig 1: Classification of Marketing Environment

As can be seen in the above figure, the marketing environment can be broadly classified into (Anderson, J.C., Narus, J.A., 1998):

i) ii)

Internal Environment External Environment

The Internal Environment refers to the components/aspects which are internal to an organization and thus control can be exerted on them. The components are commonly referred to as the 5 Ms- Man, Money, Material, Machinery and Management. The External Environment on the other hand refers to the aspects which are not within the control of the organization. These factors, commonly known as

PESTLE include Socio-cultural, government Legal, Political factors and so on. These factors can be divided into 2 broad categories:
a) Micro Also known as the operating environment, it is close to the business

and influences its capacity to work. Its components include Suppliers, Customers, Market Intermediaries, Competitors and Public
b) Macro Also known as the general environment, it includes components

such as economic, political, technological, socio-cultural, and demographic environment.

1.2.1 External Analysis

India being the target market, the PESTLE analysis will be done for the same. India today is being looked at as an attractive market for investment and business. Due to availability of cheap labour, abundance of unskilled workers, highly qualified engineers and IT professionals and so on, it has become an attractive market for business investments and start ups. Let us now analyse India (Oxford University Press, 2007).

a) Political
India is predominantly a democratic country, in spite of its cultural and regional differences. Having a strong democratic setup is on one hand advantageous as the political parties indulge in social welfare to gain the support of the masses. Also the democratic setup has helped to have good relations with Europe and North America. There have been various agreements signed between the nations, like the Indo-US nuclear deal. However, uneasy relations with neighbours, Pakistan and China are a threat it faces at present which gives rise to terrorism. Apart from this social and communal tensions can seriously affect the stability of the government. The growing naxilism activities are a big threat to the internal security of the country.

Current Strengths

Current Challenges

Strong democratic setup Stable macroeconomic policies Future Prospects Uneasy relations with neighbours Terrorism Future Risks Social and communal tensions Coalition politics and rise of communism

Improved accountability of politicians Initiation of economic reforms

Table: Analysis of Indian Political Landscape

b) Economic
Over the last few years we have seen stability and growth in the Indian economy. The manufacturing and services sector has performed well. According to datamonitor report, infrastructure will witness the largest growth in expenditure in the next 4 years. Also over the last two years the growth rate has been 8%. However, inflation has been a cause of worry. Also there is a strong urban and rural divide and more than two thirds of the Indian population lives in the rural areas.

Current Strengths Strong GDP Largest working age population in the world

Current Challenges Unemployment Energy constraints Inflation

Future Prospects Strong infrastructure spending Sector specific opportunities

Future Risks Widening economic disparities Impact of appreciating currency on new economic sectors

Table: Analysis of Indian Economy

c)

Social (Kotler,P., Keller,K.L., Koshy,A. and Jha,M., 2009)

India is among the top countries in terms of population. However, it has a young population to its advantage. Talking of the sex ratio, it has always weighed heavy for the males. In spite of launching its health policy in 2002, India has performed poorly on various social indicators and is reflected in its Human Development Index (HDI) ranking. It faces a huge problem of malnutrition, female foeticide, State specific backwardness and so on.

Current Strengths Improving sex ratio Rapid urbanization

Current Challenges Healthcare Weak social security system Low HDI rank

Future Prospects Rising life expectancy Employment guarantee scheme

Future Risks Rising population density Inability to control birth and fertility rates.

Table: Analysis of Indian Society

d) Technological
India has made drastic growth in the technology sector with the rising number of institutes and the patents approved. India has become an attractive R&D destination due to low costs and a strong knowledge base. Also the policies of the government have favoured and enabled the growth of this sector. However, rupee appreciation poses a risk.

Current Strengths Knowledge base Cost advantage

Current Challenges Gross expenditure on R&D to GDP remains below 1% Vocational training required by talent pool

Future Prospects Government policies promoting R&D Employment guarantee scheme

Future Risks Appreciating rupee

Table: Analysis of Indian Technological Sector

e) Legal
In terms of legal structure, India has witnessed a comprehensive legal and regulatory framework which has enabled the business entities to grow. A few recent tax reforms like VAT and few in pipeline like GST have helped in increasing the indirect tax collection drastically.

However the recent Satyam scam has exposed the state of corporate governance in the country. Also there is a lack of awareness and a coordinated approach to enforce regimes in India.

Current Strengths Comprehensive legal framework VAT implementation

Current Challenges Corporate Governance Judicial delays

Future Prospects Expansion of tax base Impact of foreign trade policy (2004-09)

Future Risks Implementation of regulations Lack of single financial market regulator

Table: Analysis of Indian Legal Landscape

f) Environment
India has a rich bio-diversity. However there is lack of enforcement in terms of environmental policy framework. With the increasing global awareness of environmental hazards like decreasing water table content, pollution of air and water bodies, emission of greenhouse gases, India needs to cope up. India has in the recent times been part of various conferences on climate change but it needs better policy implementation of the same.

Current Strengths Biodiversity Right to information

Current Challenges Air pollution Depleting water resources Dependence on fossil fuels for energy requirements

Future Prospects Public private partnership and eco tourism Conserving water

Future Risks Adverse impact of economic growth Enforcement deterrents

Table: Analysis of Indian Environmental Landscape

1.2.2Internal Analysis
The core competencies of Cadbury can be listed as below (Cadbury India Ltd., 2011):

Own manufacturing setup: With 5 manufacturing plants in India run by Cadbury it definitely enjoys benefits of cost reduction, patented technology and full control over its operations.

Market leader in biscuits and confectionary: Cadbury is already a market leader in few categories which undoubtedly gives it a competitive advantage over others. Well known brand: Cadbury is already a well known global player and is known to its customers very well. Wide coverage: Cadburys presence in over 170 countries gives it a good market share and a strong holding in the business environment. Extensive Brand Portfolio: Cadbury has a very diverse range of brands under its umbrella due to which it has a very wide target market as well as brand presence across the globe.

1.2.3

SWOT Analysis

Based on the above analysis we can demarcate the strengths, weaknesses, opportunities and threats for Cadbury operations in India as follows: Strengths Strong Brand Name Diverse portfolio Manufacturing setup Familiar territory Opportunities Growing market for chocolates Weaknesses Scarcity of available resource Poor infrastructure facilities

Threats Intense competition

and confectionary Innovative products welcomed by consumers Relatively available. cheap labour

Rising raw material prices Rising costs of labour Diverse geographic, characteristics. demographic, psychographic

2. Marketing Objectives
2.1 Product brief
For our study we will take Trident Gum and make a plan for introducing it in the Indian market. Trident is the worlds biggest chewing gum brand. And its still growing, more than doubling in size since 2003. It was one of the worlds first sugar-free gums. And it was also the first gum in space, enjoyed by astronauts on the 1964 US Gemini space flights. Gum is the fastest growing confectionery category on earth. Last year the category grew 4.8 percent globally and Krafts share of the market is 29 percent, according to Euromonitor. That kind of success only comes from constant innovation. For example, Trident Xtracare gum features Recaldent, own patented ingredient that helps your teeth by replacing lost minerals. Since 2006 Trident Xtracare gum has grown by nearly 23 percent.

Krafts Food innovations have turned the category inside out, with center-filled gum and more indulgent and longer-lasting flavors, like Trident Layers gum, which stacks flavors like apple, pineapple, strawberry and citrus.

Trident gum comes in five varieties:

Trident Trident Splash Trident Layers Trident Xtracare Trident White Some of the many flavors available throughout the world include: Wild Strawberry and Tangy Citrus, Green Apple and Golden Pineapple, Cool Mangoberry, Orange Swirl, Strawberry, Cinnamon and so on. Trident is the number one gum brand in the world according to Euromonitor, with market-leading positions in the US, Canada, Mexico, Brazil and Spain (Krafts Food, 2011).

2.2 Marketing Objective

In India the size of total chewing gum market is about Rs 1000 crore with an annual growth rate of 10%. (SlideShare Inc. 2011) The major players in Indian chewing gum market are: Perfetti Lotte Candico Wrigley The marketing Objectives for Cadbury can be stated as below: Sales: The total Chewing gum market in India is Rs 1000 crores and Trident is the global leader in chewing gum. The target of sales for the first year of operation would be 10% of the market i.e. Rs 100 Crores. The sales target has been set keeping in mind the excellent distribution network of the parent company Cadbury. Market Share: As the company is a new entrant in the chewing gum market in India, the market share to be targeted during first year of operations is 10%. The focus will be there to penetrate the market with increasing the brand awareness as well as customer education.

Customer Awareness: It is a key criteria and the company will invest a sizeable amount in customer awareness. The brand awareness of the parent company Cadbury in India is good which will help in quick connect with Trident gums. Company will also use social media platform to increase the brand awareness among its target market. Distribution Penetration: As the parent company Cadbury already has a well setup distribution channel, Trident gums can reach every nook and corner of India. The focus will be on effective supply chain management so that the distribution of product is in a smooth and efficient way.

Product Launches: Company will launch

Trident Splash: In India Center fresh brand from Perfetti is the market leader in the segment and has no significant competition. Trident splash with different flavours will be launched against Center fresh gums. Trident White: This category has products like Orbit (Wrigleys) and Happydent (Perfitti). Trident has an extensive flavour combination in comparison to its competitors such as cinnamon, spearmint, wintergreen etc. Original Trident flavour: This will be the flagship trident product and limited flavours will be launched which are: Bubble Gum, cinnamon, original, spearmint, strawberry and watermelon Twist.

3. Marketing Plan
3.1 Target Market
As trident has different products in chewing gum the target market for these are:

Trident Original: Urban youngsters who want something different from the present brands and which gives a feel of originality. They would want to buy from certain upscale retail stores or chains.

Trident Splash: A mass category product for Urban Semi urban and even rural population. This segment of consumers prefers to buy from neighbourhood kirana (grocery) stores.

Trident White: Health conscious people who chew gum for dental hygiene. Youngsters and middle aged customers are potential buyers.

3.2 Positioning and Differentiation

The brand will be positioned as a global leader sugarless chewing gum brand which is arriving in India. It is a well setup brand in the developed nations with a variety of flavours which are new to the Indian market. The differentiation of the Trident brand will be based on the product offering in comparison to its competitors. As Trident has different flavours in specific categories which are not present in Indian market, the product has a potential to become Market leader in specific categories. The other differentiation factor will be the distribution channel as performance will be differentiable in terms of Ordering, Service and Personnel. An effective distribution channel which services the stakeholders such as channel partners, retailers and end consumers is a very critical differentiating factor.

3.3 Marketing Mix

Product Mix: As the product is new to the market, it has flavours which have never

been launched before in the Indian market. Cinnamon flavour is one of the flavours which will provide a completely different flavour in the chewing gum category. Watermelon flavour is one another category. So the product has a differentiation factor from its competitors.

Price Mix: The pricing strategy to be followed is Market based Pricing strategy. Being a FMCG product pricing is very crucial. If the company goes for penetration pricing, the immediate results can be good but in the long run it will have to raise prices and that can be more hurting and loss making, resulting in the loss of market share. A market-based pricing strategy is also known as a competition-based strategy. In this pricing strategy, the company evaluates the prices of similar products that are in the market. It is important to consider those products that are similar to the product being offered. Depending on if the product has more or less features than the competition,

the company sets the price higher or lower than the competitor pricing. (Wood, M.B, 2010) Pricing of the product is an important factor. Trident gums will be launched in 50 paise and Re.1 packs. The pricing has to be competitive especially in a price sensitive Indian market.

Place Mix: The strong distribution channel of the Cadbury brand will provide a platform for Trident brand. Certain other point of sales will also be added such as Dental clinics and Pharmacy shops which can easily sell Trident white brand. A channel distribution model will be followed with a network of Stockists, Dealers and Agents. These entities will be supplying the products to the retailers and ultimately end customers. Modern retail and Institutional sales channel will be an intricate part of the distribution model as Indian market is fast moving towards modern trade and once the limit of FDI in retail is increased the sector is poised to grow at a very fast rate.

Promotion Mix: Promotion of the brand will be a mix of Above the line and

Below the line modes. Apart from the conventional media advertising. The differentiation in promotion will be based on effective web marketing with a strategic importance of social media marketing. Social media has the power to increase the brand awareness on a viral level within a fraction of the cost. Facebook has already been acknowledged as an excellent tool for brand promotion as well as connect. Social media marketing programs usually center on efforts to create content that attracts attention and encourages readers to share it with their social networks. A corporate message spreads from user to user and presumably resonates because it is coming from a trusted, third-party source, as opposed to the brand or company itself. Social media has become a platform that is easily accessible to anyone with internet access. Increased communication for organizations fosters brand awareness and often, improved customer service. Additionally, social media serves as a relatively inexpensive platform for organizations to implement marketing campaigns. With emergence of channels like Twitter, the barrier to entry in social media is greatly reduced. (Hollensen, S., 2010)

4. Marketing Budget
An estimated cost to market the Trident chewing gum in India can be calculated through two ways: a) As a percentage of revenue/expected revenue. b) As Per Competition. c) As per the priority. All the above mentioned techniques have their own pros and cons: We will individually take the above three techniques and evaluate the pros and cons and then decide on the technique to apply.
a) As a percentage of revenue/expected revenue: This is by far the most talked

about method of determining market budget. This method works by taking a fixed percentage of revenues. For ex 10% of the revenues, if the revenue is Rs 100 crore then the marketing budget will be Rs 10 crore and then allocate that amount for marketing. The most commonly used numbers are 5-10% (generally for bigger businesses), 20% (used more for small businesses), and 2-5% (very large companies). Picking the percentage that works best for company will probably take some trial and error. Pros: Its an easy and understandable answer. Cons: It really isnt very accurate. Also, with small or new businesses, it can completely break down if you dont have much to show for revenue. It will vary wildly depending on the profit margins. (Schewe, C.D. and Hiam, A. 1998).
b) As per competition: This method is simple in principle: In this method we

find out how much our competitors are spending, and use just-a-bit more than that or the same amount to market our products. The reality of doing this is a lot more difficult than it seems, since it can be very hard to find out exactly how much the competitors are spending. If you do manage to find out that

information, this method can be a great way to figure out how much to spend marketing. Pros: Its a reasonably good estimate of how much the company need to spend to compete in the marketplace. It can also save company some calculations, assuming we can actually get good information on our competitors. Cons: Its hard to find out what our competition is spending. Also, the act of entering the marketplace will likely change how much our competitors spend, so the numbers wont be accurate for long.
c) As per the priority/ objective: This is a general model that works by setting

out objectives, planning out the tasks required to complete our objectives, and then estimating the cost for all of those tasks. It can be effective if lot of measurements and information about the business processes are done, and if the company has very specific objectives it want to reach. Pros: Its a solid way to determine the budget. Company can also make sure it is tailored to what is specifically important to it. Cons: You need to have an understanding of what objectives are important to your company, and the ability to link them with tasks. This method can require a lot of calculations. The marketing budget most suited among three for the first year of operations is As per the Priority/Objective. This is because, the organization has its cash flows and the revenues are yet to come. Then the competitors are already established and Trident has to penetrate the market, which may require an increased amount of marketing spend. Setting the Marketing budget according to the priorities and objective can solve the purpose because in this technique the company will have complete check on the program and budget.

5. Conclusion

From above we can see that Cadbury as a brand is well known among consumers worldwide. It is a brand which has been serving consumers for decades and thus the consumers relate to the brand easily. With its extensive geographic coverage and wide brand portfolio, Cadbury is among the market leaders in its segments. Talking of India as a market for business is very favorable due to various factors like availability of cheap labor, strong knowledge base, acceptance for new products and so on. However there are negative aspects like poor infrastructure, changing demographics and geographic characteristics and so on. But on a whole India as a region is favorable for growth and investment. As discussed above Trident as a brand is well established in various countries. Its launch in India by Cadbury will lead o easy and early acceptance by the consumers due to established brand name as well as uniqueness of the product offered. On a whole with streamlined marketing efforts and initiatives from Cadbury, Trident is sure to succeed as a brand in the Indian market and gain quick acceptance by consumers.

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Inc.

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Chewing

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