STRATEGIC MARKETING

TERM PAPER

STRATEGIC MARKETING PLAN DEVELOPMENT FOR

A NEW PRODUCT: JAUL

SUBMITTED BY:
SHOAIB HUSSAIN LABIB AHSAN RHYTHM
16231060 16230182

ANIKA RAHMAN KAZI FARZANA YEASMIN

16231014 16231038

SAKIB MAHMUD ZAKARIA HRIDITA RAHMAN

16231072 16231054

SUBMITTED TO:
JARIN TASNIM DATE:
BUP 07.12.2019
 Members
Name ID
Marks

Shoaib Hussain 16231060

Labib Ahsan Rhythm 16231082
Anika Rahman 16231014
Hridita Rahman 16231054
Kazi Farzana Yeasmin 16231038
Sakib Mahmud Zakaria 16231072
Table of Contents
Executive Summary...................................................................................................................................5
Product.......................................................................................................................................................7
1. Product Inroduction.............................................................................................................................7
1.1 Product Portrayal...........................................................................................................................7
1.2 Product Profile...............................................................................................................................7
2. Market Research and Analysis.............................................................................................................9
2.1 Market Description........................................................................................................................9
2.2 Market Segmentation and Targeting..............................................................................................9
2.3 Competitive Analysis...................................................................................................................11
Pricing Strategies.....................................................................................................................................14
3.1 Setting the pricing objectives:..........................................................................................................14
3.2 Determining Demand:.....................................................................................................................14
3.3 Estimating costs:..............................................................................................................................14
3.4 Types of cost and level of production:.............................................................................................14
3.5 Analyzing competitor’s costs, prices and offer:...............................................................................15
3.6 Selecting a pricing method:.............................................................................................................15
Promotional Strategies:...........................................................................................................................15
4.1 Advertising:......................................................................................................................................15
4.2 Personal Selling:...............................................................................................................................16
4.3 Promotional Tools:..........................................................................................................................16
4.4 Public Relations:..............................................................................................................................16
4.5 Distribution Channel........................................................................................................................16
4.6 Services and warranties...................................................................................................................16
Manufacturing and Operations..............................................................................................................17
5.1 Locations..........................................................................................................................................17
5.2 Human Resource.............................................................................................................................17
5.3 Technological Aspects......................................................................................................................17
Financial Analysis and Documentation..................................................................................................18
6.1 Sales Forecasting.............................................................................................................................18
6.2 Profit and Loss Projection................................................................................................................18
Conclusion................................................................................................................................................20
Executive Summary
We want to market Green Coconut Water. We have prepared this feasibility plan on that basis.
We have assigned a name for the product as “Jaul”. Since the raw materials are very much
available in our country, we have decided to give the product an indigenous image.

Jaul is a kind of soft drink that provides the consumers with processed green coconut water in
bottles. For the marketing purpose of the product we have decided to launch three product lines.
The Jaul would be launched in the market at 250 ml. 500 ml. and 1 Litre bottle.

We have set a reasonable price for the product so that all kinds of people can afford to buy this
soft drink. We have followed the Target Costing pricing approach. We would gain a
competitive advantage, as this is a first hit in the market.

We have targeted a huge market segment for the product. Bangladesh is a large populated
country. Lots of people are looking for such a product. Green Coconuts are not available all the
time. For example: a person walking on the street. Suddenly he feels thirsty. Now if he wishes to
drink green coconut water he cannot find it easily. It is not always found in the right place at the
right time. If we launch our product in the market, a person willing to drink green coconut water
can have it from a nearby shop. At present this is not possible. Our target market includes health
conscious people, sick people, sportsperson & many other consumers, which we have
segmented from the Demographical, Geographical, Psycho graphical & Behavioral point of
view.

We have prepared a financial documentation for this feasibility plan of a new product. As we are
introducing the product in three categories at 250 ml, 500 ml and 1 Liter bottles, we have
prepared the Break-Even-Analysis for each of the product line. We have prepared the feasibility
plan for five-year basis.

For 250mls the break-even point is at 4158004 Units. That means if we sale 4158004 Units a
year, we will make neither profit nor loss. So, to make profit we have to create a market demand
in such a way so that more than 4158004 Units are sold every year. Obviously, the unit cost will
eventually come down because of the law of Marginal Cost. Then the break-even point will also
come down. But that is from the long run perspective. So initially we might suffer loss but
ultimately, we would earn enough profit. The consumers will first taste the product by
consuming the 250ml bottles. So, we might gain a short run profit from that.

For 500mls the break-even point is 4914004.914 units per year. So, we have to sell more than
4914004.914 units to earn profit. We know that after the product is well promoted, people will
eventually consume more of 500mls, as pet bottles are more in demand. The price is such that
people will turn to the 500mls because we are providing them at lowest possible market price.

For 1 Litre bottles we have a different plan. We know many people are not going to consume the
1 Litre package. So we have assigned more profit on them per unit. Our target is to sell less
quantity of products but achieving higher profit. For 1 Litre bottles we have estimated the break-
even point at 1724137.931 bottles per year. As we can see, we have prepared the selling price in
such a way so that, to be in a profit earning zone we have to sell least amount of units comparing
the other 2 product lines.

We have given an elaborate discussion on financial summary at the later stage of the feasibility
plan. We have followed the Target Costing Pricing Policy; which means an ideal price is set
first based on customer considerations, then target costs will ensure that the price is met. We
decided the market price before. Then we calculated the estimated unit price & fixed price. Then
we decided how much profit margin is possible on each of the product line. We have assigned
three different profit margins for three product lines. This price setting is based on the current
market research.
Product

1. Product Inroduction

1.1 Product Portrayal

‘Jaul’ is a product that serve different segment of customer. The product is green coconut water,
which is unique in the current market. The green coconut water will be processed and sold in
glass bottle of convenient sizes of 250 ml, 500 ml and 1 liter. The green coconut water will
be very much refreshing and provide great support to the sick and

health conscious people. Our target market is very large with different segments. Our expected
sales are very high. The development cost is tk.2.5 million approx.

1.2 Product Profile

 Name of the Product: Jaul

 Type of Product: Green Coconut Water
 Ingredients: Pure natural green coconut water,
 Sugar, mineral salts, vitamins C.
 Container: Stylish glass bottle
 Container size: 250 ml, 500 ml, 1 Litre
 Product Price: 250 ml for Tk. 12
 500 ml for Tk. 18
 1 litre for Tk. 38
 Estimated Durability: 12 Months from date of manufactured
 Machinery used: Advanced technology imported from
 USA, UK and Netherlands.
 Brand Slogan: Coola Coola… Always Refreshing.
Fig: Sample product prototype with brand name
2. Market Research and Analysis

Our company wants to develop and introduce a new Product. So, we have gathered information
through in-depth interviews. We made a survey of the market to have a clear idea about our
market, our customer demand, needs and wants. This information helps us to know about the
current market and prospects of our new product.

2.1 Market Description

Bangladesh is a country of about 150 million people.. The total market size of the soft drink
industry is about 20 million and day by day it is increasing. We have a spread nationwide market
of different convenient product. People are nowadays very much concerned about the market and
product conditions. So we have a growing prospect of customers of “Jaul”. Among the
population we worked out few segments of customers who will prefer our product most.

2.2 Market Segmentation and Targeting

Market Segments

We have observed and analyzed the market and based on the nature of the market we segmented
the market in the following sectors:

Geographic Segmentation:

 Sylhet
 Rajshahi
 Khulna & Barishal
 Chittagong
 Dhaka

Demographics:

 Individuals
 Family
  Sportsman
 Business buyer

Psycho graphics:

 Higher class
 Higher mid class
 Middle class

Behavioral:

 Sick people
 Health conscious
 Sophisticated who take the new product from the market

Target market and projections:

Analyzing all the segments, we decided our target market according to our product category. The
target customers of “Jaul” are sick people, health conscious people, sportsmen and tourists. The
company decided to charge Tk. 12 for 250 ml bottles, Tk. 18 for 500 ml bottles and Tk. 38 for 1
Litre bottles, if we consider price versus taste received then we can see that taste received is
more in value. Therefore charging the mentioned prices are justified. The following graph gives
a clear idea of our target market.

Target Market:

Health Conscious – 32%

Sick people – 43%

Tourist – 3%

General people – 22%

We separate our target market into four different segment based on their geographic,
demographic, psychographic and behavioral characteristics.

Health conscious: Health conscious people basically the sports person are one of our largest
target market. In this segment, we get a lot of potential customer. One third of our total
population is young. This is a significant number that we have to concern about them and
provide product, which is fit for them. About 5 million people of this total number are health
conscious. They spend about Tk. 500 in a month in average.

Sick people: Sick people are one of our major considerations. More than 1 million children
suffer from diarrhoea that need liquid food. Not only child but also the adult might suffer from
those types of problems.

Tourists: Every year a huge number of tourists visit Bangladesh. We want to provide them with
“Jaul”.

General Customers: Besides the above segments, the general customers will acquire a
significant portion of our target market.

Market Needs:

“Jaul” wants to satisfy its customers need. That’s why it is important to identify the market
needs. Our first consideration is to provide the best product to its customers. That’s why we offer
three different sizes of bottle with different prices for its different segment of customers.

250 ml: The lowest price for the rural mid social class and individuals.

500 ml: Its target the sick people and tourist

1 litre: For a small family.

2.3 Competitive Analysis

The Soft drink industry is very much competitive. Many soft drink companies have acquired a
significant portion of the market. But the unique features of “Jaul” will take it far beyond the
reach of the competitor. Because, no one has yet thought about selling green coconut water in
such a specialized way. To evaluate our prospect of “Jaul” in the current market, we have
analyzed the market situation in various ways. Following are some demonstration of the analysis:

2.3.1 SWOT analysis:

The product existence in the future is depending on its strengths, weakness, opportunities and
threats analysis:

Strengths:

 Available input materials

 Low production cost
 Technological and marketing knowledge
 Strong distribution channel
 Easy manufacturing process
 Reasonable price

Weaknesses:

 It is easy to copy the idea by others

 Taste differ from the natural green coconut water
 Green coconut water cannot be preserved for longer period

Opportunities:

 Monopoly market
 Large market
 High demand
 Might have a chance to get subsidies by Govt. to export

Threats:
  High competition in future by copying the idea
 Entrance of new product
 Alternatives are avoidable in some segment
 Uncertainty of launching a new product.

2.3.2 Competitor Analysis

The major soft drinks and juice companies of current market are:

 Pran Groups
 Starship
 Uro Cola
 RC Cola
 Coca cola
 Pepsi
 Acme
 Danish
 Foreign Products etc.

Distinct Competency:

These companies can try to entrance our market by launching new product lines to compete us.
Yet, we have distinct competitive advantage. That is our product is still brand new. The other
companies will take sometimes to enter into the market. Till then we can have a monopoly
market condition. The other advantage that we have is lower price. We will sell products in
reasonably lower price then other competitors do.

Strategies against competitors:

 To compete with the major competitors we can adopt the following measures:
  Providing the best service to create high customer satisfaction
 Reasonable and acceptable pricing
 Promising and providing top quality product
 Launching highly effective mass promotional activities
 Continuous innovation and modification of the products
 Creating and maintaining long term customer relationship
 Creating “Brand Loyalty” among the target consumers

Pricing Strategies
We have decided to set a reasonable price for our product when we will develop it. We
considered many factors in setting the pricing policy. We will describe a six-step procedure:

3.1 Setting the pricing objectives:

Our company has decided where it wants to position its market offering. We have chosen our
objective to maximize market share. We believe that a higher sales volume will lead to lower
unit costs and higher long-run profit. We have set the lower price because we assume that the
market is price sensitive. Our overall objective is to capture the maximum market share by
setting lower price.

3.2 Determining Demand:

Each price will lead to different level of demand and therefore have a different impact on
company’s marketing objectives.

3.3 Estimating costs:

We have estimated the cost and want to charge a price that covers the cost of production,
distribution and selling the product, including a fair return for its effort and risk.

3.4 Types of cost and level of production:

There are two types of cost: a) fixed and b) variable. In our new product development project
fixed cost is 2,00,00,000 taka. Fixed cost includes- machinery, monthly bills, and salaries of
employees and so on, regardless of output.

There are some variable costs like-cost of bottle, packaging and so on. These costs tend to be
constant per unit production. We have estimated that per unit variable cost is Tk. 6.3 for 250 ml,
Tk. 12.6 for 500 ml and Tk. 24.4 for 1 litre.

3.5 Analyzing competitor’s costs, prices and offer:

We have analyzed our competitors’ price and found that Pran charges tk.10 for 250 ml bottle,
Starship charges tk. 12 for 250 ml Pac.

3.6 Selecting a pricing method:

We have chosen the target costing method to set price for our product; pricing that starts with an
ideal selling price based on customer considerations, then target cost will ensure that the price is
met.

Promotional Strategies:
To acquire a strong position in the market, we need to give special emphasis on effective
promotional activities. In order to get the maximum market share we will have to use all four
tools of marketing promotion. Specially, advertising through mass media will support us a lot.

4.1 Advertising:

We initially will give more emphasis on paper ads and TV commercials. Because, advertising
through these media is the most effective way to reach the customers and position our product in
their mind. We are anticipating that this will have a massive impact on the teenagers and other
enthusiasts. Few neon signs and bill boards of “Jaul” also can be set up in some core points of
the city. We hope to reach 75% of our customers through effective advertising.
4.2 Personal Selling:

Though personal selling skill is not that much effective for convenient products like “Jaul”, we
will inspire and train the sales persons of the retail stores to convince people to buy our product
when they will come to buy any drinks item. The sales persons will inform the consumers about
the cool refreshing taste of “Jaul” and about the nutritious aspects. We hope that will play a
significant role to increase our sales.

4.3 Promotional Tools:

We have also planned to apply some promotional tools. Initially for sometimes we will distribute
our product at 50% discount just make our new product familiar with the customers. This will be
the market-testing period for our product. Later, we may apply the strategy of giving gifts, lucky
coupons, tour tickets depending on the market and competitive situations.

4.4 Public Relations:

We have future plans to hold seminars, commit social development, supporting social activities,
to arrange cultural functions and mobile game shows for publicity purpose.

4.5 Distribution Channel

In the initial stage, we will distribute the products with our sole distribution channel. When our
market will spread out, we will distribute our products through dealers. We will set our own
outlets in few core market positions. When we will go for mass marketing, we will supply our
product nationwide through dealers. Our dealers will take the products to every district of the
country. “Jaul” will be available in all retail stores of the country.

4.6 Services and warranties

As we are targeting to the top most customer satisfaction and building long-term customer
relationships, there is no alternative for us rather than providing top quality service. Giving the
customers timely and instant quality service is our primary concern. We even planned to open
few customer service centers where will response to customers’ interactions. We will collect
information, suggestions, ideas and opinions of the customers through these centers and will
innovate and modify our product accordingly. We also will change any defected product.

Manufacturing and Operations

5.1 Locations

We will set our manufacturing and other working areas in convenient locations. We will prefer
the locations to set up our manufacturing firms, warehouses and inventories in different core
business points of the country where it will be easier to both collect the raw materials and
transport the final goods to the market.

5.2 Human Resource

The board of directors will be responsible for the recruiting activities. Recruiting will be done
through written tests followed by interviews.

5.3 Technological Aspects

To create and innovate new quality products we need to use advanced technology. We need high
tech machineries imported from the foreign countries. Not to mention, skilled people to operate
them. We have already studied all the technical aspects and prepared a list of instruments and
their costs. The machinery will be collected when required.
Financial Analysis and Documentation

6.1 Sales Forecasting

The following Table and graph show our expected sales for the coming five years:

Expected Sales(Per year) 250 ml. Bottle 500 ml. bottle 1 Litre bottle

First Year 4000000 4500000 1500000

Second Year 4500000 5000000 1700000

Third Year 5500000 5800000 2000000

Fourth Year 6000000 6500000 2400000

Fifth Year 6300000 6700000 2500000

6.2 Profit and Loss Projection

For 250 ml.

Item Year 1 Year 2 Year 3 Year 4 Year 5

Total Sales 44440000 49995000 61105000 66660000 69993000

Total Cost (45200000) (48350000) (54650000) (57800000) (59690000)

Total Profit (760000) 1645000 6455000 8860000 10303000

Tax 40% — 658000 2582000 3544000 4121200

Net Profit (760000) 987000 3873000 5316000 6181800

For 500 ml.

 Item Year 1 Year 2 Year 3 Year 4 Year 5

Total Sales 75015000 83350000 96686000 108355000 111689000

Total Cost (76700000) (83000000) (93080000) (101900000) (104420000)

Total Profit (1685000) 350000 3606000 6455000 7269000

Tax 40% — (140000) (1442400) (2582000) (2907600)

Net Profit (1685000) 210000 2163600 3873000 4361400

For 1 Litre

Item Year 1 Year 2 Year 3 Year 4 Year 5

Total Sales 54000000 61200000 72000000 86400000 90000000

Total Cost (56600000) (61480000) (68800000) (78560000) (81000000)

Total Profit (2600000) (280000) 3200000 7840000 9000000

Tax 40% — — (1280000) (3136000) (3600000)

Net Profit (2600000) (280000) 1920000 4704000 5400000

Conclusion
There is no brand competing for the product coconut water which gives the brand advantage over other
brands. Since many juice brands are faced with issues related to deteriorating health benefits and having
harmful chemicals, coming up with this healthy and unique alternative to the existing consumer base
has the potential to drive consumers towards this brand. The marketing mix and other strategies are
also formulated in such a way that we think that this brand will have potential to grab the market in no
time.
 LETTER OF TRANSMITTAL
3rd November,2019
Major General (Retired) Alauddin M A Wadud, Bir Protik
Professor,
Department of Business Administration-General
Bangladesh University of Professionals

Subject: Letter of Transmittal

With due respect, we, the students of BBA-2016, Bangladesh University of Professionals (BUP) have
prepared the Term Paper on “STRATEGIC MARKETING PLAN DEVELOPMENT FOR
A NEW PRODUCT: JAUL” under the course Strategic Management.
Though there were some limitations, but we have tried to bring the most out of it. As we are still
on our learning curve, we would kindly seek for overlooking our shortcomings. We have been
able to learn a lot of things during making the paper. It was an extremely challenging and
interesting experience. Thank you for your supportive consideration for this challenging task.
Without your inspiration, this report would have been an incomplete one.

Lastly, we would be thankful once again if you please give your judicious advice on our effort.

Yours sincerely,

SHOAIB HUSSAIN LABIB AHSAN RHYTHM

16231060 16230182

ANIKA RAHMAN KAZI FARZANA YEASMIN

16231014 16231038

SAKIB MAHMUD ZAKARIA HRIDITA RAHMAN DINTU

16231072 16231054