The purpose of this report is to find marketing strategies to launch a new product at CBL which was established in 1968. CBL is one of the leading biscuit manufacturing companies in Sri Lanka. Specific objectives were to scan the micro and macro environment, identify the profitable market segment for the new product and develop marketing mix strategies for the same. After an extensive analysis of the market, customer profile, and price criteria, it was determined that launching the black currant shortcakes to the consumer marked will be best benefited for our future growth.
2. Background of the organization.
2.1 history
In the early years
Williams biscuit factory, Sri Lanka’s first factory owned by Mr. Williams was a small scale hand mad biscuit venture. In 1939, Mr. Simon Arthur Wickramasinghe (1902-1984) acquired this factory, launching ‘Williams confectionary’ with just 10 employees. It was mechanized in 1957 with Baker Perkins Lines from the UK.
The joint venture
In the 1960’s ‘Williams’ together with the Sri Lankan government and care of USA, manufactured high protein biscuits to supplement mid-day meals for school children, based on a proposal by Mineka Wickramasinghe, current group chairman, to improve the nutritional standard of Sri Lankan children. For this purpose a biscuit factory was built on eight acres of rubber land surrounded by green paddy fields in Pannipitiya in 1968.
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2.2 Visions
Vision of the Ceylon biscuit limited is to become the leader in confectionary in South Asia with a global recognition. Because the Ceylon Biscuit limited is privately owned they don’t have an explicit mission. But instead what the Ceylon biscuit limited does is adapting to the set of marketing objectives, like for example increasing market share of a certain brand by some percentage for achieving each year.
2.3 Product
At present Ceylon biscuit Limited’s main business in food manufacturing and in initially it was limited to biscuit manufacturing. Then the company started to manufacture chocolate products under the brand name Ritzbury, manufacturing cakes under the name Tiara and also wafers biscuits under the same brand Munchee. They recently started manufacturing instant jelly under the brand name go jelly. During the very same period the company has taken controlling shares of Lanka Soy, Samaposha and Cecil so now the Ceylon biscuit limited has started competing in the fruit drinks market, soy product market, serials and snacks market of Sri Lanka.
3. Marketing process and marketing oriented approach.
3.1 Marketing process
3.1.1 Environmental analysis
Swot analysis
It is the strategy development tool that matches internal organizational strengths and weaknesses with external opportunities and threats.
Strengths- Factors and features assisting the organization in achieving its goals and objectives.
Example:-
Availability of resources
Ability to create and innovate
Ability to face competition
The advantage based on technology
Weaknesses- internal factors and features blocking the achievement of goals and objectives.
Example:-
Non availability of resources
Inability to create or innovate
Inability to face competition
Disadvantage based on technology
Opportunities- external factors that will assist in achieving goals and objectives.
Example:-
Economic situation is favorable
Number of competitors are high
Technology changes are favorable
Market changes are favorable
Threats- external factors that would block the organization from achieving its goals and objectives.
Example:-
Economic situation is unfavorable
Number of competitors are low
Technological changes are unfavorable
Market changes are unfavorable
3.1.2 Segmentation, targeting and positioning
Market segmentation
It is a situation where customers are too numerous and different in their needs and wants of similar products/services, organizations will find it very difficult to satisfy everyone’s individual needs and wants. Hence they have to identify segments with similar needs and wants they can serve efficiently and effectively.
Target marketing
Target marketing has three steps:
Identifying groups with similar needs and wants, which is also referred to as market segmentation
Choosing one or more market segments to serve and serve with professionalism, which can be referred to as market targeting
Develop a value proposition for each target market segment chosen to serve so that it can communicate and cater extreme value to the target market, which can be referred to as market positioning.
Market positioning
It is the process by which organizations design its message and image in a way that they would acquire a valued and distinct place in the minds of the target customers.
3.1.3 Marketing mix strategies
Product
If the strategy would be to produce a smaller Marie biscuit with a level of quality the tactic would be to plan the manufacturing of the product accordingly. Thus the product is the first element of the marketing process. The product is the main element that gives value to a product. That determines the desired level of quality and process to produce, package, branding in order to differentiate it from other products and size determination are the aspects that should be taken into consideration when developing the product.
Price
If it was determined that price has to be similar to competition in the market place then the pricing must be planned accordingly. But it can’t be done in complete isolation since production and other operations drive costs. Therefore a study must be done on production, operations, human resource needs and finance activities and so forth to arrive at the best possible pricing decision.
Place
Product development and pricing it won’t be enough. It should be available in the target market to purchase. Therefore the product must be place at points where the target market would visit to purchase. The marie biscuit has to be place at the supermarkets and retail outlets, as those are the places where people go to buy biscuits. Therefore placing the product in the correct place is an important tactical element to ensure that the product is available for the consumers to purchase.
Promote
Only people who visit shops and see the product will know it is available. We see so many products on shelves but do we grab each and every one of them? No, but we continue to buy what we always buy. Therefore communicating with the target market is important they should be informed that the products are available to purchase and as to why the product should at least consider buying than any other product that they have bee purchasing already. In the situation where the product is already in the market the objective of promotion/marketing communications, as it is known today is to provide the products positioning and create a demand.
People
People are the most vital element of the organization to provide value in a business to customer marketing environment and they must have the needed training as well as continuing development.
Process
KFC serves a limited number of products but have achieved excellence in the process where when even a drive thru customer is served with least waiting time. This what is meant by process to be on top of the process of serving customers.
Physical evidence
Most of the services are intangible unlike in a product, which is tangible. The simplest example is a restaurant that claims they serve excellent food but when the food is served it contains excess salt. Therefore it is necessary to ensure that physical evidence is present always.
3.2 Marketing oriented approach
3.2.1 Benefits and costs of marketing oriented approach.
Benefits
To shift customers from the stages of the communication effect pyramid
To understand the current market share
To understand customer perception of the products and make improvements
Customer attraction through packaging and labelling
Free transport and warehouse storage
Costs
Promotional costs – 1. advertising cost
2. Sales promotion cost
i) Consumer promotion
ii) Trade promotion
iii) Business and sales force promotion
3. Public relations
Marketing research costs
Design, labelling and packaging costs
Outsourcing costs
Discounts provided to distributors
4. Marketing mix strategies
4.1 selected product
The product that will be chosen by me is the Munchee super cream cracker which is one of the most famous biscuits produced by CBL. C:UsersShamilPicturesz_bus-p01-Munchee,%20now%20premium02.jpg
4.2 Product strategy
Product attributes
The distinctive taste and shape of the Munchee super cream cracker Is what mainly sets it apart from other brands of cream crackers. CBL makes sure that every super cream cracker produced is of right consistency to their standard of manufacturing. CBL is always on the process of enhancing their biscuit’s taste so that they will have the upper hand against its competitors. Super cream cracker is famous for its saying among the consumers which is “podi badaginnata munchee super cream cracker ekak kanna”. Through this iconic saying the cream cracker has gain the loyalty of so many consumer which in turn puts them on top when compared with CBL’s competitors.
Branding
There are so many brands of cream crackers available in the market and to identify the cream cracker produced by CBL would be quite difficult if it did not have differences hence that’s the reason why CBL has named their cream cracker as Munchee super cream cracker with a creative slogan included. Over the years CBL’s super cream cracker has developed a very good reputation among the consumers, that’s why they have customer loyalty towards the cream cracker. CBL has developed this loyalty through providing the loyal customers with consistent high quality cream crackers even from the day they started providing the market with their cream crackers. CBL’s cream cracker and Malibans cream cracker has a very intense competition in the market even though both brands have a similar customer loyalty from last year’s sales it could be seen that Munchee has a little bit more sales than Maliban which makes them the leaders.
Packaging
The super cream cracker is packed in a special package which could be easily differentiated from other cream cracker brands. It can be separated because of it special color which is yellow that has been the color CBL has been using for the past few years so now it is very easily Identified and purchased by their loyal customers. The packaging provides protection, attracting attention of the customers, convenience to the buyers, knowledge about the cream crackers, affordable, greater value, environmental concern these elements are mostly provided by Munchee than in other cream crackers.
Labeling
The label chosen by Munchee to represent the cream cracker is very graphic and attractive to the eye. It is important the label should be graphic because if a person didn’t know the name of the product it is easy for the person to identify the label.
Transport
Transporting is done through professional distributors which is not a competitive advantage.
4.3 Distribution strategies
Munchee super cream crackers are distributed through a selected group of distributers. CBL does not have their own fleet of vehicles available for the distribution of cream crackers around the country. That is one of the disadvantages of Munchee. But it doesn’t mean that they don’t have a competitive advantage. Super cream crackers are distributed through distributors to retail shops directly and sometimes indirectly such retail shops are as follows:
Cargills food city
Arpico super stores
Keels super
Pharmacies
And other small scaled retail shops island wide.
Super cream crackers are distributed to every single retail shop in the island which makes them the top biscuit distributers and sellers in Sri Lanka. They export cream crackers to over 10 countries around the world CBL is known to be the first country to export a single product to several countries in Sri Lanka. CBL plans their distribution process accurately, effectively with skillful execution. Because they make it convenient to their loyal customers through distributing cream crackers to most of the super markets where most of their loyal customers purchase their products. CBL practices the intensive distribution strategy which is the process of achieving the maximum width and depth of distribution for the company’s products. To all the large scaled retail outlets such as arpico and etc. they provide optimum stock levels of cream crackers to avoid chances of stock outs.
4.4 Pricing strategies
When CBL selects the right pricing strategy for the super cream cracker they take into consideration three important areas such as:
Customer oriented strategies
Competition oriented strategies
Company oriented strategies
Customer oriented strategies
This is a pricing strategy which is mostly market focused and is based on what the customer is willing and able to pay. Four different aspects can be identified
Skimming pricing strategy
Market penetration pricing strategy
Psychological pricing strategy
Value based pricing strategy
Competition oriented strategies
This is where pricing is competitor driven. CBL decides to price the cream cracker taking into consideration the pricing levels of the competitors.
Company oriented strategies
CBL also takes into consideration what they will get in return when pricing a specific product.
4.5 promotion strategy
Figure 4.5.1 – Promotional mix elements
Cream cracker is advertised through the use of attractive posters which amplifies the expressiveness of the consumer who sees it. Also they use creative and innovative ways to advertise the cream cracker on the television which instantly attracts the consumers.
CBL uses direct marketing in order to deliver the goods to the consumers. In some instances it can be seen that the CBL uses sales representatives in order to talk and explain the information about the product to the customers.
CBL gets involved in lots of community activities and they sponsor musical shows and they even host shows of their own just to advertise their products.
4.6 extended marketing mix elements
People –
Employees
Customers
Suppliers
Managers
Directors
Marketing executives
Research and development team
Process –
Buying of raw materials
In order to make the dough the appropriate amount of ingredients should be added
The machine would mix the dough for several hours until ready to be spread out
After spreading out the industrial biscuit cutter will cut the dough into the appropriate sizes
The cut dough will be baked for a number of hours in a n industrial oven
Then the biscuits will be left until cooled down
After cooling the biscuits will be automatically counted by the machine and will be packed in to a wrapper
The finish product will be distributed to all the retail outlets in the island so that it will be available for the buyers.
Physical evidence presentation –
A factory that is situated on a land of eight acres
Machinery for every step of production
Clean production area
CSR projects done in order to enhance the reputation
Employee friendly work stations
Appropriately departmentalized
5. Marketing mixes for different contexts
5.1 Marketing mix for two different segments.
5.1.1 Marketing mix for the children of all age groups.
The product I will be introducing as a marketing director of the Ceylon biscuit limited is black currant shortcakes. It’s a biscuit with a black currant jelly in the center. It will contain up to 20 biscuits divided into two columns, each column will consist of 10 biscuits each. It would be an evening tea time biscuit.
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The decision for making it an evening tea time biscuit is that, during the evening most of the children play and when they come back home they expect their tea to be on the table but it would be a special treat to see a few brown biscuits with purple colored jelly dripping from the side of it on a plate, so the kids will be curious in order to know what it is, what it tastes like and eventually they would end up putting it in their mouth and they would feel the soft crunchiness of the biscuit and burst of black currant jelly in their mouth which will make them beg for more.
It would be sold for Rs.250 this includes the packaging charges as well, it will be packed in a colorful manner because children like anything full of different colors.
It would be sold in super markets and in retail shops mainly.
Advertising will be done through attractive posters, newspaper advertisements and through a television commercial by utilizing most of the viewed channels by children of all ages.
5.1.2 Marketing mix for adults of all age groups.
In the evening time most of the Sri Lankan families get together as a family to talk about their days work and everything else while enjoying a cup of tea and the Munchee black currant shortcakes will provide the cherry on top of an ice-cream in other words the best biscuit to continue the conversation. Adults will enjoy it a lot especially because it will be a low sugar biscuit but with the natural sweetness of the black currant. It would be the perfect gift to give when going to visit family and friends. At the back of the box all ingredients and information will be provided regarding the biscuits which will be helpful for adults who are careful about what they are consuming.
Its retail price would be Rs.250 including packing charges, and it is packed in colorful box with a gift able appearance to it.
It would be sold in super markets, retail shops mainly and also will be sold in selected pharmacies as well.
Advertising will be done through posters, newspaper advertisements and on television channels frequently viewed by adults of all ages.
5.2 Marketing mix for business to business context.
Figure 5.2.1 Distribution channel
Pricing –
Discounts on list prices.
Sales promotions –
Huge discounts based on bulk quantity.
Advertising –
Occasionally but very rarely done.
Public relations –
Very less.
Transportation costs.
5.3 Marketing activities in the international market.
Product
Producing products according to the standard of different countries by providing high quality products. And the products should be produced according to the appropriate countries culture.
Price
Prices will be set considering the currency which the country is using. The prices set would be fair in order to achieve popularity for the product.
Place
A separate manufacturing organization will be there specially to produce export quality products.
Promotion
Advertising will be done through the use of internet and visual posters and if possible television or newspaper advertisements will be provided according to each individual countries customs and beliefs.
PEST Analysis
Political –
The product is to be exported under the rules & regulations of the Socialist Republic of Sri Lanka. First the relevant product has to be registered under the rules of the SL Port Authority. In this, paying the required taxes, as enlisted by the government is paid high importance. Social compliance policies are also to be given high prominence.
Economical –
While pricing the product in the international market, it should be noted that the agreed price would create a profit, when the taxes & other levies are paid out.
Social –
It will be produced and exported after taking into consideration, the beliefs and culture of the country of receipt. The packing (Both single & Whole sale packing) will be environmental friendly. The flavor of the shortcakes will be flavored according to the countries appropriate palate. The name of the product in the country of origin should not be a social barricade in the foreign land.
Technological –
The means of transportation should not be a hindrance to maintain the quality of the product exported. The time consumed in transportation should also be taken into consideration.
Conclusions and recommendations
Conclusion
Since the Ceylon Biscuit Limited controls the majority of the biscuit manufacturing and selling market compared to other competitive markets it can be concluded saying that CBL is the number one company in biscuit manufacturing and the company which has been consistently providing their loyal customers with high quality biscuits, chocolates, cakes and etc. in Sri Lanka.
Recommendations
Continue researching and come up with more products
CBL should have their own modes of distribution
CBL should keep up the quality of the products manufactured
They should build a second factory in the north of Sri Lanka in order to make the distribution easier
maintaining a healthy and an environmentally friendly working place for the employees and benefit of the business
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