KDL Foods Limited (formerly Kool Dairies Limited)

Marketing Plan
Mahreen Gul Amna Kamran Moona Khadim Zeeshan Azam Ahsan Mehmood Sohaib Sadiq MBA-13209 MBA-13212 MBA-13202 MBA-13222 MBA-13204 MBA-13206

SUPERIOR UNIVERSITY LAHORE

1. Business Overview
Mission statement Build branded food business to improve quality of life by offering tasty, affordable and highly nutritional products to our consumers while maximizing shareholders value. Vision statement Most innovative and fastest growing food company offering products enjoyed in every home every day. Core values 1. Team work 2. Empowerment 3. Trust

2. Market Analysis of Malaysia and Russia

Economic figures of Malaysia

Details
Currency Exchange rates

Malaysia
Ringgit (RM) ringgits (MYR) per US dollar 3.07 (2012 est.) 3.06 (2011 est.) 3.22 (2010 est.) 3.52 (2009) 3.33 (2008)

Russia
Russian ruble Russian rubles (RUB) per US dollar 31.32 (2012 est.) 29.382 (2011 est.) 30.368 (2010 est.) 31.74 (2009) 24.853 (2008) $2.509 trillion (2012 est.) $2.422 trillion (2011 est.) $2.322 trillion (2010 est.) note: data are in 2012 US dollar $1.954 trillion (2012 est.) 3.6% (2012 est.) 4.3% (2011) 4.3% (2010) $17,700 (2012 est.) $17,000 (2011 est.) $16,300 (2010 est.) note: data are in 2012 US

GDP (purchasing power $492 billion (2012 est.) $471.2 billion (2011 est.) parity $448.4 billion (2010 est.) note: data are in 2012 US dollars GDP (official exchange rate) GDP - real growth rate $307.2 billion (2012 est.) 4.4% (2012 est.) 5.1% (2011 est.) 7.2% (2010 est.) $16,900 (2012 est.) $16,500 (2011 est.) $15,900 (2010 est.) note: data are in 2012 US dollars

GDP - per capita (PPP)

GDP - composition by sector Labor force Budget

GDP - real growth rate

Inflation rate Exports

Exports - commodities

Exports partners

dollars agriculture: 11.9% agriculture: 4.4% industry: 41.2% industry: 37.6% services: 46.8% (2012 est.) services: 58% (2012 est.) 12.84 million (2012 est.) 75.24 million (2012 est.) revenues: $59.22 billion revenues: $413 billion expenditures: $75.31 billion expenditures: $414 billion (2012 est.) (2012 est.) 4.4% (2012 est.) 3.6% (2012 est.) 5.1% (2011 est.) 4.3% (2011) 7.2% (2010 est.) 4.3% (2010) 1.9% (2012 est.) 5.3% (2012 est.) 3.2% (2011 est.) 8.4% (2011 est.) RM513.59 billion (Jan- Sep Exports from Russia 2011) amounted to US$524.6 billion in 2012, up 12.1% since 2008. Russias top 10 exports accounted for 86.8% of the overall value of its global shipments. Crude petroleum A$994m Mineral fuels including oil: Education-related travel $375,423,947,000 (71.6% of A$739m total exports) Copper A$710m Iron and steel: Personal travel excl. education $22,601,664,000 (4.3%) A$431m Fertilizers: $11,176,846,000 Coal A$356m (2.1%) Inorganic chemicals: $7,835,699,000 (1.5%) Machinery: $7,609,061,000 (1.5%) Singapore 13.3%, China 12.5%, Netherlands 12.2%, China Japan 10.5%, USA 9.5%, 6.4%, Italy 5.6%, Germany Thailand 5.3%, Hong Kong 5.1%, 4.6%, Poland 4.2% Germany: 2.7% RM424.37billion (Jan Sep 2011) Crude petroleum A$3,668m Transport A$646m Monitors, projectors & TVs A$568m Computers A$554m Refined petroleum A$535m Japan 12.6%, China 12.6%, Singapore 11.4%, USA 10.6%, Thailand 6.2%, Germany 4.0% 3.0% Malaysias average salary $358.1 billion Machinery, equipment and transport means: 47.7%. Chemical products, rubber: 15.8%. Foodstuffs and agricultural raw materials (excluding textile): 15.7% China 15.5%, Germany 10%, Ukraine 6.6%, Italy 4.3% 6.2% Russias average salary

Imports Imports - commodities

Imports - partners

Unemployment rate Average wage

currently stands at 11,000 RM

Population below poverty line Food Industrial Analysis

3.8%

currently stands at 23,600 rubles 13.1%

Malaysia: Malaysias food industry is rich in terms of tropical and agricultural resources reflecting diverse cultures in Malaysian society Malay, Chinese and Indian, have resulted in a fascinating range of processed food with an Asian twist. Increasing consumer awareness in nutrition value and food fortification for healthcare has created the demand for functional/healthy minimally processed fresh food, organic food and natural food flavors from plants and seafood. The Malaysian food and beverage market is becoming increasingly sophisticated and is supplied by both local and imported products. The strong economic growth in the late 80's and early 90's contributed to major changes in consumer purchases and consumption patterns. Malaysians living in urban areas are relatively brand conscious, and they prefer to shop in stores, which offer them convenience and good product selections. Lifestyle changes have led to an increase in the demand for convenience food and health food. The food processing industry is predominantly Malaysian-owned. In Malaysia, the food industry is dominated by small and medium scale companies. The major subsectors are the fish and fish products, livestock and livestock products, fruits, vegetables and cocoa. In line with the governments emphasis on the agriculture sector, the processed food and beverages industry had become an important component of the agro-based industry. In 2010, the food processing industry contributed about 10% of the Malaysian manufacturing output attracted a total of RM1.972 billion in 69 projects. Employment in the processed food and beverages industry decreased in 2009 by 5.1% to 43,080 compared with 45,418 in 2008. Labor cost for the industry remained competitive, as its Unit Labor Cost decreased by 8.2%, reflecting an efficient utilization and management of resources. Small and medium sized enterprises represent more than 80% of the total number of establishments in the processed food segment. Malaysia is also one of the world major producers of spices. In 2010, Malaysia ranked as the sixth largest producer of pepper and pepper-related products (specialty pepper, processed pepper and pepper sauces). The Malaysian livestock industry is an important and integral component of the agricultural sector, providing gainful employment and producing useful animal protein food for the population. It contributes about 18 percent to the total Food Sector Agriculture Value Added and export earnings (NAP, 1998). The gross output value of livestock in 1999 was RM5.2 billion (DVS, 1999 [RM3.8/US$ at 5 July 2002]). The industry can be classified into the non-ruminant and the ruminant subsectors. It has shown a steady growth over the years attributed mainly to the active

participation of the private sector, particularly in the sub-sectors of poultry, eggs and pork. Within a relatively short period of time the pig and poultry industries have been able to transform themselves from backyard subsistence levels to highly modern, commercial and efficient production systems.

Russia: Livestock herds decreased drastically during the 1990s, with the number of cattle and pigs dropping by about 52% and 55% respectively between 1990 and 2000. As a result, Russia became a large meat importer during the 1990s (cf. Liefert et al., 2009). When the Russian agricultural output began to rebound during the 2000s, also the livestock sector was expanding. However, while especially poultry production increased considerably, beef production continued to decline. In recent years, positive trends have been noted in the dairy sector in the Russian Federation. The national average milk production rose 60 percent, from 2.2 tonnes in 1997 to 3.5 tonnes in 2007. Regions of intensive production have emerged in the Northwest and Central federal okrugs, which are near centres of industrial milk processing around Moscow and St. Petersburg. These regions are characterized not only by high yields per cow but also by increasing production volumes. There has also been significant progress in smoothing out the seasonality of milk production, which has been completely overcome in some regions, in particular in the Leningrad Oblast, Moscow Oblast, Altai Krai, Krasnodar Krai and in the Republic of Tatarstan, and Bashkortostan. Both private and public investments in the sector have increased, enabling the creation of large dairy farms with modern technology. Against a background of increasing consumer demand, the milk processing industry has developed rapidly. The high seasonality of milk production has been a problem for dairy farms since Soviet times. Shortages of milk in autumn and winter followed by surpluses of milk in the summer caused fluctuations in market prices. New federal technical regulation for milk and dairy products took effect at the end of 2008. These regulations set requirements for milk and dairy products to ensure that production, storage, transportation, points of sale and utilization of dairy products are safe. They also introduced new technology for the dairy sector, as well as packaging and labelling standards for milk and dairy products.

Livestock sector of Malaysia Table 1 Livestock Population

Livestock sector of Russia Table 2 Livestock Population

3. Opportunity analysis
Malaysia is interested in Pakistani live stocks ISLAMABAD, March 30 (APP) - Pakistan and Malaysia on Wednesday launched Pakistan-Malaysia Joint Business Council (JBC) in Kuala Lumpur.Datuk Mukhriz Bin Tun Mahathir,the Malaysian Deputy Minister of Ministry of International Trade and Investment and Saleem H. Mandviwalla, Chairman Board of Investment of Pakistan launched the Council, said a press release received here from Kuala Lumpur. The JBC launching ceremony was attended by Pakistan High Commissioner in Malaysia, Masood Khalid, Syed Ahmad Hussain Shah, Minister for Commerce and Industry, Government of Khyber Pakhtoonkhawa, Mohammad Zubair Motiwala, Advisor to Chief Minister Sindh on Investment, Dato Mohammad Salim Fateh Din, Chairman of Malaysia Pakistan Joint Business Council, Saadat Muzaffar, CEO, Punjab BOI & Trade, Zubair Habib, CEO National Industrial Park (NIP), Syed Asghar Abbas Rizvi, Director General BOI, Syed Feroz Shah, Advisor, BOI and President, National Chamber of Commerce and Industry Malaysia (NCCIM), the representatives of private sector of government official of Malaysia. (Friday, 30 Nov
2012)

4. Market highlights
Malaysia (Population: 23.5 million) was one of the first Asian economies to return to growth after the onset of the Asian currency and economic crisis of 1997/98. It reported economic growth of 5.8% in 1999. Local analysts forecast that the economy should grow by between 7.5% and 8.5% in 2000. Today, it is the third wealthiest country in Southeast Asia after Singapore and Brunei. Malaysia has one of the most sophisticated consumer markets in South East Asia. Unlike the other large Southeast Asian nations, e.g. Indonesia, Thailand and the Philippines, Malaysia has a nation-wide consumer base that encompasses both urban and provincial/rural areas. Middle to upper income group of consumers comprise about 61% of the population or 14 million persons in 2000. These persons are key targets for the full range of dairy products that are in the market today.

5. Market orientation
Customer focus The company is committed to strict quality standards in all its operations - from the collection of milk to the provision of hygienically processed nutritious products to its customers. The company follows the philosophy of "delighting the customers" by providing them quality products at the right price on their door step. The company treats them as partners Keep channel of communication open with them because they are the only reliable source that can provide them best feedback about the product.

6. Segmentation Variables
Geographic Region: Density: Malaysia Urban

Demographic Age: Above 4 years

Income: Maximum: 52,500 MYR Average: 7,449 MYR Median: 5,200 MYR Minimum: 910 MYR Social Class: Lower middle Class, Middle upper class, Middle -Middle class. Psychographics Activities: Interest: Opinion: Health related, education, Convenience outdoors, Active, sports, fashion, family values Social concern

7. SITUATION ANALYSIS
The marketing environment for KDL foods Ltd. represents overwhelming opportunities. It also contains some challenges that the firm believes it can meet successfully. SWOT analysis of the company conducted by marketers to highlight Blue Skys strengths, weaknesses, opportunities, and threats SWOT Analysis Strength: International packaging Affordable and reasonable price Have our own packaging plant Weaknesses: Heavy capital will be required for promotion Consumers are brand loyal toward competitors product so we have to convince them. Opportunities: Increase usage Can introduce flavored milk People are switching from unhygienic to hygienic milk Threats: Competitors can come up with plastic bottles

Competition Analysis

Competitive Framework
Company Name Product Name Category Product Class Overall Market Share

NAN Grow

Powder

Pouch Pak Nestle holding brand 50%

Nestle

NESPRAY

Powder

Pouch Pak

of

national

market share Omega Plus Powder Pouch Pak

Everyday

Powder

Pouch Pak

Dutch Lady Milk

Dutch

Lady

Pasteurized Milk

Tetra Pak

Pasteurized Milk

ready-to-eat Dutch Yoghurt Dutch Lady Lady yoghurt yoghurt drinks Flavored P. Milk and Packing

Dutch

Lady

brand holding 40% national Tetra Pak market share of

Chocolate Drink Dutch Lady Sterilized Milk Tetra Pak

Sterilized Milk

8. Buyer Analysis
For KDL brand the buyer profile comprise of lower middle, Upper and Upper Middle class individuals having the exposure of international countries with awareness of product freshness i.e. bottled milk. The main focus is on health, taste and the price factor. Product Market Dealing in packages dairy products with main area of concentration in packaged milk products that include Processed, Condensed and Instant formulations. Sooper Milk Chocolates Tropical fruits drink Dairy queen milk powder, Anchor milk, Asli ghee

9. Targeting & Positioning Strategies

The targeting strategy for SOOPER is recommended to be Selective due to the following market and industry dynamics which are as follows;

Stage of the product Life Cycle The Dairy Industry of Malaysia is growing at a steady and consistent manner at 15% per year. The industry attractiveness is fairly high for SOOPER and opportunity to develop strong business within the segment. Diversity of Preferences Consumer awareness for the health factor is on the rise due to media exposure and education within certain segments. With shifts in priorities for hygienic consumption and family health concerns increasing, packaged brands of milk are increasing for various consumption usages of milk. Industry Structure Competitive intensity is not as high and entry barriers are quite high. With the process being a highly complex and delicate matter which can cause tremendous financial crunch to medium sized organization. Competitive Advantage In the packaged milk category, the competitive advantage that can be obtained is through effective distribution and consistent marketing communications.

Target Strategy Targeting approaches for developing SOOPER brand is Selective Targeting since the industry is growing at a rapid pace and since the product portfolio is fairly diversified creating; POSITIONING STRATEGY Positioning Statement: MAKE YOU HEALTHY Struggling business to enhance brand image of SOOPER as a daily routine, nutritional diet for the entire family.

Positioning Concept Trying to create the perception that milk is healthy and is a quality habit that should be a part of all family members, giving them nutrition, satisfaction and happiness that tastes good. Positioning Strategy Shelved in A, B and C category retail outlets to create favorable brand associations Price is at RM.34/- that signals that quality is consistent in a new packaging Advertising and sales promotions to be focused according to the quality and fun drinking association of SOOPER as a health assuring milk Positioning Effectiveness The objective is to monitor and evaluate how the positioning of SOOPER is received by the target market and according to what the core values of the SOOPER brand communicate. PRODUCT STRATEGIES The product strategy we are following is Product line strategy. In this further we are using product improvement strategy. We are improving product through 1. Taste: Delicious 2. Nutritional value Added enriched vitamins and Zinc [fatty acids] with iron for

supplementing healthy growth. Milk for growth, enriched with zinc, vitamins,

essential fatty acids and, above all, iron, with content 25 times higher than conventional milk. This is a decisive advantage when you know that 70% of babies have an iron deficiency. With half a litre of SOOPER every day, children will get 65% of the iron and 80% of the calcium they need. We will launch a campaign in Schools. Sticking Posters on Walls near schools and providing refrigeration having Candia milk using cartoon character Garfield. 3. Design: (Brick packaging) 4. New Flip top cap This will give us a competitive edge and mover advantage because currently fewer companies in Malaysia are offering Flip top cap facility which ensures freshness and hygiene. BRANDING STRATEGY We are using Specific product branding strategy because brand name gives a unique identification in the market place, Using SOOPER tea whitener name gives positive associations to customers that this product is used by us and we have a trust on this name so using this product also enhance the product image and corporate brand identity. DISTRIBUTION STRATEGY We are using conventional channel for the distribution. We have 4 main distributors in Lahore. Distribution intensity is selective. Currently the company is covering 1000-1200 outlets. It is intended that the distribution will be the same which is exclusively carrying the product to the retail outlets. There would be dedicated shelf spacing to maintain the SKU (stop keeping units) for example providing refrigeration and exclusively designed POPs according to specifications as per the brand image and requirements. We are providing SOOPER to A, B and C class stores. The reason why we have chosen this strategy is due to financial considerations. Profit for the distributors is 1.25%. Distributors pay cash in advance to the company to get the product. (We are using all the products supplied by these distributors). PRICING STRATEGY Pricing Objectives 1. Gain market position (Acceptance by the consumers) 2. Influence competition

We are using price penetration because if we analyze the packed milk competitors like Milk Pak and Milk flow their prices are higher. We are maintaining the same price by offering more added features, which give us a competitive edge. Added features include more added values as well as flip top cap. Items Sooper Milk Chocolate Tropical fruit drink Sooper powder milk, Asli ghee Price MYR 35/MYR 15/MYR 25/MYR 45/-

The other considerations also include the Non price factor. Buyers are willing to pay more prices to gain other competitive advantage, so taking this into considerations we have included new nutritional elements as well as new flip top cap to maintain the quality and freshness of the SOOPER MILK. We are giving added value to our customers as the company has promised to provide quality products with differentiation.

10. Marketing mix

Product Price Price is less than competitor Using market penetration High quality and convenience product Packaging Packaging or bottle is reusable

Promotion Place We give incentives to retailers To enhance awareness We do promotion on TV channels and newspapers

11. PROMOTION, ADVERTISING, SALES PROMOTION STRATEGIES

Our advertising and promotion strategies is based on three phases

Creating the Awareness, educating the consumers providing information about product benefits and what are the diseases caused by lack of consuming milk.

Increase Usage, advertising campaign based on situation, fun, enjoy and health.

1. 2. 3. 4.

Below the line activities (BTL) Brand line extension (targeting kids) Co-branding with Dunkin Donuts Co-branding with LU biscuits

Promotion We will use Pops in which all the KDL brands are available. (Special Shelves for KDL). This will give a unique identity to the corporate name and to products. Live for yourself! (Advertising Campaign) We have decided to devote a special issue to milk, it's because day after day we're reminded of its many benefits. It helps prevent osteoporosis, especially if it's drunk very early in life; and it is the ideal way of getting the vitamins, minerals, trace elements and essential fatty acids we need to avoid nutritional deficiency.

Not to mention the numerous nutritional properties that make milk a basic food for the infant and an ideal food for the adolescent, the pregnant or nursing mother and so on. In short, we all need milk, whatever age we happen to be. Milk has always played an important part in our diet. 1. Milk and children 2. Milk and women 3. Milk and older people In the 2nd phase We will also focus on different usage situation like at playing sports, at hospitals. We will also target kids having SOOPER milk having fun and enjoy. We will launch a campaign in Schools. Sticking Posters on Walls near schools and providing refrigeration having SOOPER milk using cartoon character Garfield. In the 3rd Phase We will go for co-branding with companies like Dunkin Donuts, using anchor tea whitener in their products. Promotion schemes will be used with the help of LU biscuits providing free tricky pack LU biscuits on purchase of tea whitener. We will also celebrate different occasions and will provide different gift packs. Launching Plan We are going to launch our product SOOPER MILK in August 2013 with the help of spectaculars, buntings, streamers, hoardings, mobilers at different places. Next advertising plan In the months of Sep, Oct, Nov Cable network and websites Fro the month of Dec, Jan We will again advertise through buntings, streamers, mobilers at different outlets For the month of Feb, Mar

We will advertise through print media For the month of April We advertise through spectacular at same places. For the month of May We will advertise through cable network again For the month of June We will advertise through bus stop TV advertising will be 2 times in a day and 4 days a week in first three months. Our ad will go on air in the prime time broadcasting. In the first phase we will have print ads in newspapers