Introduction to Mushrooms

Mushrooms are scientifically known as fungi but several types of

mushrooms have long been consumed as a food source. There is
evidence to suggest that the Chinese were using mushrooms as
long as 13,000 years ago.
However, in recent years, the popularity of mushrooms has
increased. In some parts of the world, mushrooms are seen as a
cheaper alternative to eating meat and even healthier in many
cases. In other parts of the world, certain types of mushrooms are
considered rare and are very expensive and sought after by
connoisseurs.
The increase in popularity of mushrooms can also be attributed to
its medicinal benefits. From simple benefits like weight management
and providing Vitamin D and improving immunity to more advanced
uses such as being helpful with asthma or stroke damage.
Therefore, given its medicinal, health and culinary benefits, there is
an increased demand for mushrooms now and there is a lot of
potential going forward as well.

Cultivation of Mushrooms
Traditionally mushrooms were collected by foraging and picking
from forests and other natural surroundings and sources. However,
the cultivation and farming of mushrooms developed over time and
is now the major source of commercially available mushrooms. As of
this decade, China, United States and the Netherlands are the top 3
producers of mushrooms in the world. This shows that there is a lot
of potential for mushrooms in India.
Question A
Despite its huge potential, the issue facing Sachin and Virag was,
How to increase consumer awareness for mushrooms? We must
first understand why it is so important for them to raise consumer
awareness.
Marketing or selling happens in four stages; Attention, Interest,
Desire and Action.
Attention is when the potential consumer learns about or
encounters the product. This can be in the form of advertisements,
shop displays or even through samples. This phase is to capture the
attention of the consumer and make them stop and take a closer
look at the product.

Interest is when the consumer takes time to find out more about this
new product, in this case, the mushrooms. This is the stage where
the consumer learns all the facts and information related to the
product.
Desire is when the consumer now has a desire or need to buy the
product.
Action is when the consumer actually goes and buys the product.
While action is the end goal of Virag and Sachin, they cannot get
there without Attention and Interest. And this is where raising
consumer awareness is important.
Raising consumer awareness is nothing but informing new, potential
consumers about this exciting new product aka Mushrooms. Thereby
creating Attention and Interest. This is why consumer awareness is
important. So how do Sachin and Virag raise consumer awareness?
First, they will need to decide who their target market is. For a
product such as mushrooms, there are two distinct types of
consumers.
a) Commercial consumer Hotels, Restaurant and Industrial
canteens
b) Household consumer Individuals and households
The buying decisions and patterns of each group are different from
the other. For example, an individual will buy mushrooms irregularly
and in small quantities, whereas hotels or restaurants will buy in
larger quantities and on a regular basis, like Star Hotel, which placed
an order of 20 kgs of mushrooms everyday.
Therefore, the consumer awareness raising campaign has to be
tailored to each type of consumer group.
Household consumers
Typically, individuals make decisions based on brand loyalty. This is
because well known brands are generally associated with good
quality. This makes it easier for individuals to decide quickly and rest
assured that the quality of the products are top notch. Furthermore,
individual do not mind paying a little bit extra as long as the brand
is familiar and well known.
As such, Virag and Sachin will have to look at creating a brand
identity for their mushrooms. For example, when someone hears the
words Baskin Robbins, we always associate with ice cream.

Similarly, Sachin and Virag should create

automatically associated with mushrooms.

brand

that

is

A vast majority of consumers today have access to television, radio

and newspapers. Virag and Sachin should leverage on this fact and
make use of these media to raise consumer awareness. They should
launch advertisement campaigns across all the available media.
However, instead of doing plain, old fashioned advertisements, they
should create advertisements in the form of contests which
encourage potential consumers to respond, participate and interact
with the company. Since their product is an alternative food to meat,
which is also healthier, they can perhaps launch a mushroom recipe
cookbook in association with a famous chef. This cookbook should
be the prize for the winners of the contest mentioned above.
The contest can be in the form of answering a question or a lucky
draw. Research has shown that, by involving the consumers, they
will remember the brand for longer and that by showing them the
benefits and ways to use the product, (through the cookbook) you
are creating Interest and Desire in the consumers.
If the marketing budget permits, a grand prize for one person that
includes private lessons with the famous chef should be awarded.
This will generate a lot of hype among potential consumers and
most importantly will encourage word of mouth and viral marketing,
which will aid immensely in increasing consumer awareness.
They can organize roadshows and set-up booths in major shopping
malls and supermarkets where free samples of the mushrooms or
dishes prepared using the mushrooms can be provided. There can
also be talks by nutrition professionals who advocate the health
benefits of consuming mushrooms during these roadshows and
booths. These same benefits can be spread through clips on the
radio and televisions.
Alternatively, they could tie-up with a well known cooking based
reality show like Masterchef and sponsor the show and have the
producers show dishes prepared using the companys mushrooms.
This will give them access to a wide audience who will now hear
about the brand and thereby capture their attention.
It must be kept in mind that any samples given out or test batches
sold, must be packaged and presented attractively. This is in
accordance with a major criteria of the marketing mix, commonly
known as Product and Packaging. This helps the company develop
its brand image and gives the consumer a pleasing experience,
which encourages them to recommend the brand to others and use
it again.

Virag and Sachin should develop and maintain a supportive

distributor/wholesaler network. These distributors can help reduce
the direct load on Virag and Sachin by taking over part of promoting
and awareness raising activities. They can also encourage retailers
to give a sample of the product free with every purchase of another
product of the retailers choice. For example, the retailer could have
a promotion where a pack of mushrooms is given free with every
pack of pasta that is bought. This will also help increase consumer
awareness as people tend to promote deals and promotion to their
friends and family.
A combination of all of this should effectively raise consumer
awareness
across
India
(the
companys
target
market)
tremendously. However, Virag and Sachin must always remember to
associate all these advertisements, contests and campaigns with
the brand. Developing the brand will ensure the long-term success
of the company, product and the campaign.

Commercial consumer
Commercial consumers for mushrooms will be hotels, restaurants
and industrial or large-scale kitchens and canteens. The priority
here is not brand name, it is economical and competitive price and
standard, dependable quality and regular supply of mushrooms.
Generally, there are no middlemen involved with these types of
consumers. Therefore, Virag and Sachin can approach them directly
to promote their product.
They must be prepared to handle various situations. For example, if
a chef has not used mushrooms in any of his dishes before, they
must be able to convince the chef to try to use mushrooms. This can
be achieved by showing the chef the increased popularity of
mushrooms as a culinary delicacy. If the chef is not familiar with
recipes involving mushrooms, they must have an informative
cookbook that will provide the necessary information to the chef.
They must illustrate to the hotels and large kitchens that their
mushrooms are competitively priced while being of a high quality
and must reassure potential consumers that the supply of
mushrooms will be regular. They can provide some sample for the
restaurants to use and test for themselves the quality and standard
of the mushrooms.
To further encourage commercial consumers to buy their
mushrooms, Virag and Sachin can offer significant discounts to the
consumers who place large orders immediately.

Traditionally discounts are not offered for credit sales but Virag and
Sachin can offer such discounts as an introductory promotion to
entice consumers to buy from them.
For commercial consumers, the important thing is to maintain a
good relationship with the chef or the person who makes the buying
decisions. This can also be achieved by inviting these people to a
retreat or workshop sponsored by Virag and Sachin. Such a retreat
has two purposes, the first is to inform these people about the
product aka the mushrooms and the second is to give the consumer
a good experience, which is sometimes known as wining and
dining. A great idea would be to hire a famous chef to cook a meal
with the mushrooms as the main dish or the star dish for all the
participants of the workshop/retreat to taste and enjoy.
Through this, the chef or restaurant owners will not only be fully
aware of Virag and Sachins product but will also be convinced that
it is of good quality and has a lot of potential uses.
We have discussed in detail the various methods by which Virag and
Sachin can raise consumer awareness for their mushrooms across
the country. However, it is important to remember that all this can
only be carried out if the marketing budget available can
accommodate these expenses. If not, Virag and Sachin will have to
implement only a few of these options and not all.
Question B
Distribution channel is of critical importance to Virag and Sachin. As
mushrooms are a perishable good, if the distribution channel is not
well established and reliable, goods may not reach consumers in
time and will go to waste, which reduces revenue and increases cost
to the company.
The perishable nature of the mushrooms means that the distribution
or delivery of mushrooms will have to be quick and efficient.
However, cost constraints must also be taken into account. For
example, while distribution by flight may be the fastest, it will not be
competitively priced and therefore cannot be used.
The recommended means of distribution would be delivery vans for
local area delivery such as delivery within the same city and for
longer distances, road or rail transport can be used. Nowadays, it is
very common for many transport services to provide cold storage
transport facilities and Virag and Sachin should make use of these
for long distance distribution. This will ensure maximum freshness
and a longer storage life for the mushrooms.

Distribution also involves the storage of mushrooms before being

loaded onto the delivery vehicles. Again, to maintain maximum
freshness and quality, cold storage facilities must be used if the
mushrooms have to be stored for more than a couple of hours.
Now the actual distribution network will also vary depending on who
the mushrooms are intended for i.e. commercial or household
consumer.
For a commercial consumer, the mushrooms are delivered directly
to the hotel, restaurant or canteen from the producer. At the most,
the mushrooms may first be sent to a regional sales and distribution
office or center before being delivered to the hotel, restaurant or
canteen.

Manufacturer

Regional
office

Hotels

Restaurants

Industrial/larg
e scale
kitchens

Fig 1. Distribution channel Commercial consumers

However, for retailing, the mushrooms are sent to a wholesaler or

distributor who then sends it to a retailer. The final consumer aka
the individual will then buy the mushrooms from the retailer. Again,
there may be a regional sales and distribution office in between the
producers main location and the wholesaler.
A wholesaler is necessary as mushrooms are a convenience good
and are consumed by individuals irregularly and in small portions.
However, they have to be easily accessible with minimum effort on
the consumers part. Therefore, wholesalers will be able to more
efficiently distribute the product to the retailers.

M a n u fa c t u re r

R e g io n a l
O ffi c e

W h o le s a le r / D is
t r ib u t o r

R e t a ile r

Fi n a l
C onsum er
Fig 2. Distribution channel Household consumers

The third alternative is to have a travelling salesperson that will

carry a batch of the mushrooms either for door-to-door selling or to
sell to new retailers. Like above, a regional sales office may be
present and the sales personnel could be deployed from either the
main location or the regional office. However, this system has the
highest risk, as there is no guarantee that the mushrooms will be
sold and if left unsold, they will go to waste, as they are a perishable
good.

Manufacturer

Regional
Office

Sales
Personnel

Final
Consumer

Retailer

Final
Consumer
Fig 3. Distribution channel Sales personnel to retailer or final
consumer

References
1. http://articles.mercola.com/sites/articles/archive/2013/05/13/m
ushroom-benefits.aspx
2. Principles of Marketing, 14th edition, P. Kotler and G. Armstrong