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Case Study On K N
Case Study On K N
Case Study On K N
The year 1964; Pakistan a young independent nation forging ahead towards a dream; self
sufficiency in food production. Malnutrition remained a major problem and one out of
four children died before attaining the age of five. 80% of the ailing children were
affected with diseases caused by protein, vitamins and minerals deficiency. Poultry
production, the quickest and least expensive way of filling the protein gap was planned to
overcome malnutrition. Backyard poultry farming has to graduate to a more professional
level.
January 1964, a young man, Khalil Sattar, still a collage student, had a vision to foresee a
need to establish a poultry farm. his interest led him to start a broiler farm of 1, 000
chicks.littlte had he known this flock was to become the foundation stone of K& N'S .
This was the simple, inspired and nationalistic beginning of K&N's with a single minded
objective of providing a better nutrition for health and happiness of the nation.
COMPANYS BACKGROUND
K&Ns is the founding pillar and beacon for Pakistan poultry industry- started in 1964
with a single minded objective of providing better nutrition for health and happiness of
the nation. Building on years of poultry expertise, and a commitment to food-safety,
K&Ns integrated all poultry production activities under one umbrella to ensure quality
and food-safety by managing and controlling all stages of production.
Our mission based on four basic values of Absolute Integrity, Enthusiastic Diligence,
Continuous Improvement and High Quality are at the core of all operations which
provide an impelling urge for attaining perfection.
In its quality assurance cell, the company maintains a check and balance on methods of
sales distribution, new business ideas and strategic options, such as entering a new
market or launching a new product in its product line, changing its suppliers and
outsourcing its services.
A few points necessary to be included in this section are given in coming sections.
STRENGTHS
Along with the developed brand identity and trust reposed by customers,
The company is now a producer of its own unique type which produces
Another factor is the strong supply chain through its distribution channels.
These factors are the basic strengths of our product inherited from the company
setup.
The unique taste and first time introduction in the markets have a vast scope
in the product line of its nature.
WEAKNESS
Though no company is a perfect in business activity performances yet pricing
strategies have been the pinching element in companys market positioning.
Though the products are cost effective as we take quality under consideration
yet most of the products are targeted for the upper class of society. We can use
appropriate and differentiated pricing strategy to avoid this weakness of
OPPERTUNITIES
As K&Ns majorly operates in Pakistan, a country where distribution of products
is limited to specific areas within an urban sector hence grooming their product of
under such circumstances has always been an opportunity for K&Ns.
By improving their Distribution channels as well as pricing strategies for
, can
give a robust increase in brand equity and can promote their product demand overall
in the market.
The comparison of the prices of chicken parathas produced at tandoors cannot
be done if hygiene is kept in view.
THREATS
Threats are always there in poultry oriented firms so K&Ns keeps an eye on new
competitors in dealing with different products related to chicken and poultry.
At present the only threat is the diseases spread amongst broiler chickens
STRATEGIC PLANNING
There are four steps which basically form the plan for our company which could derive
results in form of long term company survival. These for steps are
STEP 1
STEP 2
STEP 3
STEP 4
In these steps we aim to provide with the basics for functioning throughout the companies
production process. The long-term missions are to be achieved through setting short-term
objectives. The products are characterized and allotted weights according to demand and
necessity basis, which eventually forms the business portfolio.
COMPANY MISSION
Driven by its basic values in pursuit of perfection, K&Ns is committed to have superior
products and unmatched service through devoted people and consistent development.
BUSINESS PORTFOLIO
The K&Ns business includes the chicken products as follows:
Whole chicken:
Whole chicken roaster {skin-on, suitable for roasting}
Whole chicken w/o giblets {skin-less, without neck and giblets}
Designer cuts:
Karahi cut {skin-less whole chicken cut into 15-17 pcs. Suitable for
making Chicken karahi and other curries}
Boti cut { combination of skinless drumsticks and breast pcs}
Qorma cut { skin-less whole chicken cut into 15 pcs. Ideal for making
qorma and other everyday curries.}
Boneless meat:
Breast fillet {skinless boneless breast fillets}
Boneless handi {breast fillets cut into small cubes}
Qeema {mixed chicken meat}
Hot tenders
Fun nuggets
Fully cooked:
Seekh kabab
Chunks:
Chicken tikka chunks
Green chilli chunks
Product development:
K&Ns has developed a new pro product that is jhatpat chicken paratha keeping in
view, its objective of providing better health and nutrition for the nation. The paratha is a
much known eatable item in Pakistan that would now be available in a very new ready to
cook, chicken form. The company is ready to put its cost for the product.
Introduction:
K&Ns being launched for the very first time in Pakistan will firstly be introduced in the
federal capital { Islamabad } and provincial capitals { Lahore , Karachi , Peshawar and
Quetta } in all the outlets.
Growth:
While keeping in view the response of the customers, the would be further introduced
nationwide and its presence in every outlet would be assured so that there is no complaint
regarding the availability of the very new product. Certain advertisements have been
prepared in order to catch the customers eye.
Maturity:
With the passage of time when our product reaches its maximum growth point and the
sales slowdown so we are going to apply different strategies like reducing prices,
introducing new ingredients or items in the same etc.
Time
Jhatpat Chicken Paratha
Fun Nuggets
Burger patties, whole chicken roaster
Seekh Kebab, Karahi cut
Whole Chicken Roaster
BCG MATRIX
High
Low
High
RELATIVE MARKET SHARE
This famous approach introduced by the Boston Consulting Group helps us position the
different products of our business into four different strategic business units that let us
know the position, strength, and market hold and consumer response to our products.
MARKETING STRATEGY
K&Ns is using the marketing concept as its current marketing technique stating that the
organization should be aware of the needs and wants of the target markets and should be
delivering the desired satisfaction better then the competitors do in order to achieve the
organizational goals.
We have a plan of using the marketing strategies that have been discussed below:
Product concept:
This concept says that consumer will favor products that offer the most quality
performance and features and that the organization should therefore devote its energy to
making continuous product improvements.
K&Ns from the very beginning has focused on providing better nutrition for the health
and happiness of the nation and we will be keeping the words as they were before.
Quality is our very first priority that will make us build strong and profitable customer
relationships. We will be managing and controlling all stages of production of the
jhatpat chicken paratha as done for the rest of K&Ns products in order to ensure 100%
safe and healthy production of our product.
Selling concept:
This concept states that consumers will not buy enough of the firms products unless it
undertakes a large scale selling and promoting effort.
We are launching an unsought consumer product as none of our competitors or the rest
has launched a product similar to ours.
To make our valuable consumers aware of our newly launched product we have decided
to use this concept. We will create awareness among our customers on a large scale
utilizing all he best promotional means available. Television and radio ads are at the first
priority, billboards at the best locations or different areas, newspaper ads and door to door
awareness programs are at the second. Other than these promotional strategies we will
ensure the availability of our product in access at all K&Ns outlets and the departmental
stores and bakeries.
MARKETING PROCESS
It is the process of analyzing marketing opportunities, selecting target markets,
developing the marketing mix and managing the marketing effort. The marketing process
comprises of three stages given as follows:
Market segmentation
Target marketing
Positioning
MARKET SEGMENTATION
Market Segmentation is the process that companies use to divide large heterogeneous
markets into small markets based on distinct needs, characteristics or behaviors who
might require separate products or marketing mix. From the four very basis of
segmentation i.e. Geography, demography, psychographic and behavioral we divided the
market into two of them given as follows:
Demographic:
Dividing the market into groups based on demographic variables such as age, gender,
family size, incomes, family lifecycles, religions, race, occupation, generation etc.
Family size (in order to get an idea regarding pieces per pack)
Occupation (as our main focus is those related to tough jobs or studies or
dont have much time for cooking or most probably the break fasts)
Psychographic:
Dividing the market segments into groups based on social class, lifestyle or
personality characteristics.
While dividing the market segments psycho-graphically we used the following:
Doctors
Engineers
Business class
Govt officials
Bankers
Students etc
MARKET TARGETTING
Every organization selects a set of buyers based on same needs and characteristics in
order to serve them. This is called market targeting. Two important steps regarding
market targeting are:
In this section we made an analyzed check of the probability of the current segment sales
and that expected for our product and whether we are able to generate the desired
profitability.
This is an important section where we had a sharp search over the market to find out if
there was any substitute product, the buying power of suppliers and buyers, and if there
was any competitor of ours with the chances of market diversion but we found none.
In this section we implemented a check over the relation between the companys
objective and the customers and we found an absolute positive relation between both. We
also analyzed the resources of the company with which company is highly able to serve
its customers.
Micro Marketing: the practice of tailoring products and marketing programs to the
needs and wants of the specific individuals and local customer groups. It is of two
types
Local Marketing: tailoring brands and promotions to the needs and wants of local
customer groups-cities neighborhoods and even specific stores.
Individual marketing: tailoring products and marketing programs to the needs and
preferences of individual customers also known as one-to-one marketing
PRODUCT POSITIONING
It is the evaluation of a companys products position that what place it occupies in the
market and how customers differentiate it from other products.
Product Differentiation:
We offer a pack of four. Each separately wrapped in butter paper, combined packed in
sealed plastic bags that are safe for health, and then finally packed in the box.
Service Differentiation:
Our product will be accessible and will be available at every outlet of K&Ns.
Channel differentiation:
In Pakistan K&Ns is operating in more than 35 cities. There is very diversity in its
distribution. We take the example of Islamabad city .In Islamabad there are many stores
as well as retailers in every sector, and only in I-8 there is one K&Ns store and 17
retailers shops.
People differentiation:
Technology is highly involved in the production so we will hire trained staff, those who
knows how to operate the machines. We also hire qualified staff in order to guarantee
healthy relationship between customers and retailers.
Image differentiation:
Since our product comes under K&Ns brand name hence a good image will be casted
over the consumers. Also K&Ns is a symbol of quality; hence will automatically be
recognized as a quality product.
Product Chain
K&NS are enjoying there own product chain. They have there own breading and poultry
forms, from where they get there raw material for their product.
Communicable: the consumers can feel the difference in our quality, taste,
hygiene and prices that are communicable.
Preemptive: competitor needs a lot and lot of hard work to match our standard
else it is not possible.
Profitable: the difference is profitable both for the company and the customers.
Our overall positioning strategy will be focused on More for Less winning value
proposition i.e. will offer more quality at less price range and we will focus on the needs
and wants of target customers in order to give high customer value and satisfaction.
POSITIONING STATEMENT
To target the teenagers, working women, hostilities and bachelors, we offer , a ready to
eat hot and spicy paratha, with high quality, affordability and accessibility.
Marketing Information System:
People, equipment and procedures to gather, sort analyze evaluate and distribute needed,
timely and accurate information to the marketing decision makers.
Descriptive Research:
People respond in a very positive way to the products of K&Ns. Their is a very high
market potential for the products of K&Ns. through research it was found that pricing
was an issue that needed to be considered
Causal Research:
We did research and collected primary data from people to find out that what the things
that can affect the sales of . There are various factors involved that the target customers
were looking for like the type of packaging, pricing
Our research plan was based only on the information collected from the
questionnaires and the general observation on the peoples taste requirements
SAMPLE PLAN
The sample plan used was cluster sample the total population was divided into mutually
exclusive groups such as students, teachers, business oriented and job oriented people. It
was convenience sample as well as the divided mutually exclusive groups were
approached as convenient.
We distributed 50 questionnaires among different age groups or segments
20 among the students
10 among the teachers
14 among the job oriented people and
6 among the business class
DATA SOURCE
The data was collected from the people directly i.e. it was primary data .the data was
collected from students, teachers, Business class and job oriented people.
Primary Data Collection:
As the company was introducing a new product so the data was to be collected from the
people directly. Asking about the feedback from the people related to the new introducing
this includes
Contact Method:
Personal interviewing was used as the contact method as it has excellent flexibility and
excellent quantity of data can be collected through personal interviewing and as the cost
factor involved was very less and the data can be collected very accurately.
Research Instrument
Questionnaire was used as the research instrument as they are very flexible. You can
mold your questionnaire as you want and in any way to gather your required information.
Research Approaches
The research approaches we used to evaluate our products were the observation research
and the survey research .we didnt use experimental research. But in the beginning we
will distribute a small amount of the and then do research on the peoples behavior
experimentally by observing the peoples behavior after using the product. And then
further decide about the distribution of the product or if any changes required and then
we will increase production.
Observation Research:
It was observed that the Pakistani people preferred spicy and traditional food they
responded in a very positively to the previous K&Ns product such as the seikh kabab
and the chapel kabab. It was observed that introducing in Pakistan would generate high
sales.
Survey Research:
A survey research was conducted about the about their attitude, preferences and the
buying behavior. A survey among the students, businessman and job oriented people
related to the pricing, packaging, quality, experiences
After defining the problems and developing a research plan we implement the research
plan and our research and development department will we handling the affairs and
interpreter the findings.
Paratha).We made a comparison of with the paratha if offered by Rahat Bakers the
customers are keen to buy and about the packaging mostly people were willing to buy
pack of six . People liked a combination of spicy and cheesy flavors .Most of the people
was willing to buy with a packaging in butter paper and boxes. As now a days time is
money even ladies are working in offices so they are in
search of products that are a complete meals for their family and are time saving, with the
increase in the business in the schedules of people the trend to ready to serve meals is
also increasing so A product of K&Ns has a scope in market as K&Ns has the largest
market share in ready to cook and ready to serve products. A very positive behavior of the
target customers was observed.
PRICING STRATEGIES
As we know that there are two types of new product pricing strategies
For our product we have selected the market penetration pricing strategy. We apply this
strategy to keep our product prices lower so that by doing this we attract a large numbers
of buyers and also to gain large market shares.
The reason for not using market skimming strategy is that as our product is an eatable
product and there no sense of keeping high prices for an eatable product, because as we
know that skimming strategies are for luxury products.
Segmented pricing.
Psychological pricing.
Promotional pricing.
Geographical pricing.
International pricing.
We launched our product in almost all the parts of the country with almost the same
prices. We segmented our product price in the following ways.
Time pricing strategy:
In time pricing we will lower our prices according to different seasons. We will reduce
prices in Ramadan season, as its demand is more in that season.
Promotional pricing:
This strategy involves temporary lowering of the prices of the product below the cost to
increase the short run sales. We apply this strategy when any one of our competitor lower
its product price in order to grab market shares. To compete with them we also lower our
product price so that we can retain our market shares.
Geographic pricing:
In Geographic pricing we adopt freight absorption strategy.
Freight absorption strategy:
We do not add freight charges to our product price in order to keep our product price
lower, as our focus is to capture more customers.
International pricing:
As K&Ns is not yet internationally recognized so we do not set international prices for .
K&Ns is only serving nation wide so we set prices of our product nationally.
PRICE CHANGES:
Some time companies have to initiate price change after developing pricing strategies
because of different reasons. Price change could be a price cut or price increase.
Initiating a Price Cut:
We already set a low price for our product but we cut price of our product if our sales
will not increase accordingly, in that situation we will cut the price in order to increase
sales and to capture market shares.
Initiating a Price increase:
Once our product achieved a position in a market and we set a good image in the
consumers mind and we have a large number of potential buyers then we might increase
our product price. But our aim is to give good quality product in an affordable price.
We can also initiate our product price when our product demand increases and we can
not supply according to the demand but INSHALLAH this situation will never come
because K&Ns has its own poultry and breeding farms.
If our competitors Changes the prices it affects our sales. So we should analyze the
change and react to it accordingly. Like if they low their price it will decrease our sales so
we should adopt strategies to increase it by lowering our price, giving discounts or
improving quality of our product.
Promotion Strategies:
Promotion is the activity in which the company has a chance to interact with its
customers. To Promote we use different promotional tools. These tools include
advertisements, sale promotions, public relations, personal selling and direct marketing.
Advertisements:
We will use informative advertising because it is mostly used when introducing a new
product. The objective of it is to build primary demand. We will use the persuasive
advertising when we have a competition in the market.
Sales Promotions:
In sales promotions we will use different discount strategies, giving short term incentives
in order to increase our sales. We also introduce sponsorships and discount coupons.
Personal Selling:
We will also promote our product through personal selling. Personal selling is more
effective then any other promotion strategy. Through personal communication it is easy
to persuade someone to buy your product, because in personal selling there is a direct
contact with the buyers.
Public Relations:
To increase our sales we will also ties good public relations. We develop our public
relation by doing the work of social responsibility, like wishing happy Eid or wishing any
other special event to our customers.
Through Public relations it also creates a good word of mouth for our product which is
the most efficient way of promoting a product.
Direct Marketing:
In direct marketing we will target our customers through internet, telephone, print media
and electronic media (television and radio).
Print Media:
We will promote our product through print media by advertising our product in
newspapers and in different magazines. We will adopt this type of advertising when we
want to introduce some new discount packages or sales offers. Other then advertising in
newspapers and in magazines we will also advertise our product on bill boards and
banners.
Electronic Media:
To promote our product through electronic media we will advertise our product on
different television channels and on radio stations. To make our product information more
convenient and easy we will provide our website and 24 hours toll free numbers, through
which our customers can contact us and also give feedback about the product.
Other then the print and electronic media the cheapest way to promote our product is
through short messaging service. We have a contract with different cellular companies
that they will send our promotional messages to their special numbers.
Promotion Budget:
To allocate budget for our promotion strategies we will use objective and task method.
According to this method first we define our promotion objectives, that why are we
promoting our product? After that we determine different tasks to accomplish those
objectives and at the end we estimate the cost utilize in performing these tasks.
Augmented Product: our product may provide some benefits which are
Type of VMS
Our product lies in the administered VMS in the vertical marketing system because this
type of VMS coordinates successive stages of production and distribution, not through
common ownership or contractual ties, but through the size and power of the parties.
Sender: K&Ns
Encoder: The advertising agency and the Creative department
Message: that now ready t cook proper meal is available for the hostilities and the
working women
Channel of message: through broachers, TV advertisements, newspaper
Decoding: this is done by the consumers, customers
3. Designing a message:
Using the AIDA formula we have designed our message that converts the desires of the
people for the product into the actions of purchasing it
Message Content
We will be using the rational appeal for producing the desire to purchase the . Their is
the personal interest of our targeted customers in purchasing ready to cook food that has
both safety and health
4. Message Structure:
One sided Argument:
We will use one sided argument by mentioning the strength of the as it is ready in
minutes and tastes like homemade and when you have nothing on your mind to cook you
can go for K&Ns near your door steps.
Order of Argument:
We are going to mention the most important part first the give the extra information in the
middle and then end with attracting the customers that our product is what you need
7. Collecting Feedback:
We will use personal selling strategies form collecting the feedback about the promotion
of the product like Word of mouth and by conducting surveys .
Pull Strategy:
We are using the pull promotion strategy by reading the minds of the customers and
providing them with their needs so that the customer itself goes for buying our product
and at least trying it for once, afterwards the taste and quality of K&Ns will make the
buyer purchase the product again and again.