Blue Ocean Strategy of K&N

There could be many strategies but two of them are Blue Ocean and Red ocean
strategy. A red ocean strategy involves around an existing competing market,
here one could face intense competition and aggressive rivalry. The key is to beat
the competition and exploit the existing demand. We can be more at ease by
offering differentiation against competition firm or adopting low cost strategy
(cost leadership).

The blue ocean strategy refers to strategy based on creating demand that is not
currently in existence, rather than fighting over it with other companies. It is
exclusively about creating new demand turn non customers to customers, and
align the whole system of firm in pursuit of low cost or differentiation.

The current industry of frozen meat and food in Pakistan lies in Red ocean due to
aggressive competition, various key players along with market pioneers are
fighting for the market share in current market that is finding it hard to create
new demand and turn the non-users of frozen product to add them in their
priority lists. Brands are introducing new products. This is resulting in the
competition, price war and reducing the margins to operate. Urban consumers of
Pakistan have shown greater interest in products offering greater convenience
against higher prices. Thus, the growing preference for convenience over the
price is a major driving factor for the growth of frozen foods in Pakistan.

Reach Beyond Existing Demand

Tier 1: “Soon to be” customers who are edge of the market waiting to jump ship.

Tier 2: “Refusing” non-customers who are consciously choose against your

market.

Tier 3: “Un-explored” non-customers who are in market distant from yours.

 First Tier :
They are soon-to-be customers, who have sound knowledge about product
offerings, follow your market. Brands are positioning their frozen ready
meal products with claims, such as halal-certified. It is an exciting factor
due to more nutrition benefits they are likely to switch to the market.
K&N has invested heavily on its innovative poultry plants, using the best
technically equipped machines, spending 1 – 2% of their income on
advertising, developing operating manuals to educate local shop owners
 about handling of frozen products, along with present changing market
trends of people focusing on better quality value due to heavy influx of
digitalization that has provided awareness. The composition of customers is
changing, now we have more women who are working in society that adds
frozen easy to cook food into their priority list due to time management
issues.
Sooner or later, customers will attract towards the glittering market of
frozen world.

 Second Tier :
That market is where the majority of market share lies; it is called wet
chicken market of Pakistan. People that cannot afford or have
misconceptions about halal implications, or unimpressed by market
offerings are part of second tier.
K&N has certaing premium price parameters where they never compromise
as they promise to provide healthy nourished products, but the factor of
pricing is major problem since the competition is tough and stiff, key
competitors are already offering products relatively cheaper rates, so the
whole market that doesn’t follow the frozen food cuts from the potential
customers. It is certainly huge untapped market due to refusal of customers
to have a grasp of frozen food.

 Third Tier :
The process of economic empowerment has given rise to an affluent middle
class, particularly in the metropolitan areas of Pakistan, such as Karachi,
Lahore, Faisalabad, Islamabad, and Rawalpindi. The convenience factor
associated with freezing is poised to create significant impact spanning
different sectors of processed foods and agricultural commodities in
Pakistan. The rest of Pakistan seems to be cut off, the rural market of
Pakistan is unexplored is terms of this industry, which is biggest downfall
for the overall industry.
If that market is slowly touched with product education, low cost
strategies, free samplings and effective distribution. It is a whole lot of
ocean that could be swum by the industry players.