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PROJECT COMPLETED BY:
Muhammad Nabeel Shahzad Siddiqui
Saad Mahmood Khan
Syed Abbas Haider Abidi
Muhammad Salman Khan
Mihammad Omer Sharif
PROGRAM:
Masters in Business Administration
PROJECT ON:
Marketing Report on “OLPER`s “
PROJECT SUBMITTED TO:
Muhammad Ishaq Sheikh
IQRA University
Masters in Business Administration
Certificate
This is to certify that Muhammad Nabeel Shahzad Siddiqui , Saad Mahmood
Khan, , Muhammad Omer Sharif, Syed Abbas Haider Abidi and Muhammad
Salman Khan have submitted their term report on the “Olper`s Milk” to the
Department of Business Administration.
__________________________________________
Muhammad Ishaq Sheikh
Faculty of Business Administration
ACKNOWLEDGEMENTS
In the beginning all Glory to Allah Almighty by Grace of Whom we were able to
complete our Term Report. It was His will and guidance that we were able to take this
report as a challenge and in the end He bestowed us with his blessings.
Next we would like to thank our parents whose constant efforts and appreciation
encouraged us in every aspect of our lives and InshALLAH will continue to do so.
Our Sincere Thanks to Faculty of Business Administration for supporting us and guiding
us in every phase of our report.
Special Thanks to our Teacher Muhammad Ishaq Sheikh who not only suggested us
this report but also gave us his full support and shared his precious office timings to
discuss different phases of report whenever we needed.
BRAND INTRODUCTION
Olper’s is UHT Milk UHT means Ultra Heat Treatment. In this process the milk passes
through 140 degree centigrade in 3 seconds and then immediately cooled to 20 degree
centigrade in the next 5 seconds, which in turn kills all the bacteria. This is the most
sophisticated and advanced process in the world. At Engro Foods Limited we use the
indirect method of UHT meaning that milk is heated by steam passing through stainless
steel pipes outside milk. All other brands in Pakistan use the direct method of heating
that is by injecting steam in the milk, this adds water content in the milk, where as
indirect heating in fact evaporates water from the milk. This is what makes Olpers the
"Thickest Milk".
BRAND HISTORY
Engro Foods limited (EFL) had only recently been established by Engro a traditional
giant in Pakistan’s chemical and fertilizer industry. EFL launched Olper’s Milk after long
tenure of consumer research, time and money consumption. During this time they
continuously observe the issues with the packed milk. After three years of their launch
Olper’s Milk gain reputation among consumers and now currently holding 49% of
market share. Within the dairy market, company now has a diverse portfolio of products
ranging from different types of cream to premium low fat milk.
The packaged milk category was originated in 1981 by Milk Pak, which pioneered tetra
pack milk in Pakistan. The supply chain involved collecting milk from rural areas across
Punjab, processing the milk through UHT (Ultra-High Temperature Processing)
treatment, and selling it to consumers in uniquely colored triangular and rectangular
packs designed. By 2006, the dairy milk category was growing at 20 percent annually.
Brands like Milk Pak (owned by Nestle) and Haleeb Milk (owned by Haleeb Foods) had
led the dairy market in the world’s fourth largest milk producing country for nearly two
decades without any real sustained competition. Milk Pak was identified by its green
and white packaging the colors of the country and offered a brand backed with the
strong equity of Nestle. Haleeb was recognized as the blue brand, and professed to
have the “naturally thickest” milk.
Olper’s has woken up the competition. Milk Pak responded with campaigns of its own to
reaffirm the positive equity of its brand. Haleeb implemented a response as well. And
Olper’s starts cutting its market share after competition become fierce.
Olper’s, however, stepped into the foray by launching a massive campaign that
started off with an introductory slice-of-life. Olper’s as a contemporary and modern
brand as the name itself made sound like a foreign brand, giving the perception of
quality. To a large extent, they were successful.
Secondly they did some product changes picking red as the brand color in spite
of greens and blues color, which also helped to enhance the in-store visibility and
presence for Olper’s packaged milk, and disassociation from its competition.
Thirdly they highlighted and expanded upon the various occasions in which milk
could and should use and making it “All Purpose Milk”.
Engro Foods has recently expanded its brands portfolio by launching a premium quality
ice cream with the name of Omore. Omore started its sales from the city of Lahore
because of the culturally inheritor of celebrator of festival of colors i.e. The Spring
Festival. They have started off with 24 different packs and flavors that attract kids and
adults from all walks of life.
Vision
"Our vision is to become a fast expanding giant foods company. To achieve our vision,
the company will initially focus on dairy by investing a substantial amount in plant, milk
collection capability and marketing. We are making concrete efforts to expand in and
beyond Pakistan; through strategic international alliances, to eventually become
global."
BRANDS OF ENGRO FOODS.
21% of all Products
OPLERS (Full cream) TARANG (Tea Whitener) OLWELL (0% fat)
OLPER’S CREAM TARANG (Powder Tea Whitener) OWSUM (Flavored Milk)
OLFRUTE JUICE OMORẼ ICECREAM TARKA 1kg (Aslee Ghee)
STOCK KEEPING UNIT
1000 ML __________________________________________12 Liters 1500 ML __________________________________________12 Liters 250 ML __________________________________________6.75 Liters 500 ML __________________________________________6 Liters
COMPETITION ANALYSIS
MILKPAK
MARKETING SHARE
Loose Milk 96% (Un-hygienic) Packed Milk 4% (Hygienic)
96%
4%
Market Share
Loose MilkPack Milk
PACKED MILK MARKET SHARE:
OLPERS 49%
NESTLE 45%
OTHERS 9% (Haleeb, Good Milk, Day fresh, Nurpur etc.)
49%
45%
9%
Market Share
Olper'sMilk PackOthers
PUBLIC OPINOIN & PERCEPTION
Public like Olper’s due to its availability and rich taste. Olper’s provide good taste in tea
and other dishes which include milk. The other perception is shown in graphs as under:
PERCEPTION ABOUT QUALITY
PERCEPTION ABOUT PACKED MILK
3% 8%
18%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
Olper’s Milkpak Haleeb
Good Bad
0
10
20
30
40
50
60
70
Nutritious Hygeinic Expensive Easy to use
GRAPHICAL REPRESENTATION
Advertisement. Advertisement in Movies. Preferred TVC’s. Best Packing.
ADVERTISEMENT ADDS IN MOVIES
0%10%20%30%40%50%60%70%80%90%
100%
T.V. Radio Billboards PostersNews paperPeer groupFloat Vehicles
Cable62%
DVD / VCD24%Don't Watch
14%
18
0
20
40
60
80
100
Tally 91 56 62 62 11 18 9
GEO ENT
HUMStar-plus
ARY AajGEO -news
PTV 0%
10%
20%
30%
40%
50%
60%
Haleeb Olpers MilkpakPakola milkGood milk
BEST PACKINGPREFFERD PVC’s
SUPPLY & DISTRIBUTION
Company appoints distributors to reduce risk factors, investment risk, ware house risk
and cost of transport.
According to Mr. Ali Akbar, Director Marketing EFL:
“In order to succeed, you should ALWAYS capitalize on your STRENGHTS and
NEVER on your COMPETITOR’S WEAKNESS!”
EFL did exactly that. They used their decades of PR with farmers and used it to provide
world-class supply-chain management for delivering the ultimate quality milk in
Pakistan.
Having kicked off simultaneously in 20 cities across Pakistan, the launch has been
ambitious and currently Olper’s is available in 80 cities across Pakistan. It reflects the
company’s intention to become a big player in the industry, both on a national and
international level.
EFL has its own dale and distribution network. EFL has divided Pakistan into five
regions of milk distribution namely: Karachi, Lahore, Islamabad, Multan and Peshawar.
Due to an appealing color scheme, which stands out in the clutter and thanks to EFL’s
strong relationship building and special discounts to retail outlets, Olpers’s has gained
a proper shelf placement in the presence of competitors like Nestle and Haleeb.
EFL DISTRIBUTION CHANNEL
7 Distributors (General Trade).
ICA (International Chain Account).
Makro (10% of total sales).
Metro (10% of total sales).
Food Services.
2 Distributors (10% of total sales).
COMMUNICATION CHANNEL
DISTRIBUTION CHANNEL
PLANT-1 WARE HOUSE-1 KARACHI
WARE HOUSE-2 HYDERABAD
PLANT-2 WARE HOUSE-3 SUKKAR
PRICE
The prices of Engrofoods Olper’s vary according to the size. The prices of the Available Olper’s Packs are shown below.
Pricing Methods/Pricing strategies
The Engrofoods Olper’s are sold in retail stores, convenient stores, Departmental outlets etc.
The pricing methods/strategies are set by those the company sells to. Convenient stores, Departmental outlets usually sell Olper’s at a fixed price according pack sizes.
However, retail outlet uses pricing methods and pricing strategies when selling Engrofoods Olpers.
Pricing methods
Pricing method Explanation of pricing method
Competition-based pricing Engrofoods Olper’s is usually priced below, above or equal to its competitors' prices.
Discount price Olper’s are often marked down during sale periods and special occasions. Like Ramadan this will: Generate sales Increase profits
EFL is pursuing the competitive pricing strategy for its products.
Size(ml) Olper’s(per carton)
1500 7391000 792500 430250 509
RETAILER PERCEPTION
CONSUMER’S REVIEW
SEGMENTING AND TARGETING THE MARKET FOR OLPER’S
It is difficult for any company to engage in mass production, mass distribution and
mass promotion for its product. The complexities arise from the proliferation of
advertising and distribution channels and the high costs associated with reaching a
mass audience. Therefore, companies segment the market so that they can target the
group of customers who share similar needs and wants.
The milk sector shows a market that has homogeneous preferences i.e. consumers
have similar preferences. They want milk to be white, carefully processed, and good for
health and bones. Keeping these things in mind Olper’s market has been segmented.
The marketers at Olper’s have had a number of options available to them when
segmenting the market for their products. So far company has introduced three new
products:
Olper’s milk.
Olwell diet milk.
Olper’s cream.
DEMOGRAPHIC SEGMENTATION
Olper’s products are not bounded to any particular age, gender or lifecycle. The brand is
meant for all the users of higher upper or middle class families. Even though the brand
calls for a small percentage of an individual’s income but lower class wouldn’t want to
buy the brand maybe because they are price sensitive or because they believe lose milk
is better than processed milk and has all the nutrients that the processed milk lacks.
However all the companies in the milk sector are trying to change the image of
processed milk as non-nutritionist milk. Therefore it can be said that Olper’s has been
positioned as a brand for high income earners. Due to the income factor involved it can
be said that Olper’s milk target a specific social class who are health conscious and
concerned about their weight.
PSYCHOGRAPHIC SEGMENTATION
On the basis of psychographics, factors such as personality traits, lifestyles and values,
the marketers at Olper’s have segmented the market more towards achievers who are
goal-oriented and focused on their careers, and experience those who are seeking
variety in the milk sector.
For example the ads for Olwell mostly show achievers who want to be successful, have
high aims and are already doing quite well in their concerned fields. The Olper’s
products have targeted experiences because the company has given them a new set of
brand and so many will make their first purchase because they want to try something
new. Olper’s ads also target believers, traditional conservative people with concrete
beliefs. The ads for Olper’s show the beliefs of healthy life with processed milk and
plays on the emotional aspect more.
BEHAVIORAL SEGMENTATION
Olper’s products have been segmented on the basis of benefits that consumers seek in
the milk. In this case, people look for a brand that can be used for all purposes from
drinking to tea whiteners as well to feed the animals. The ads also show that consumers
should increase their milk consumption for example with every tea they should use
Olper’s, every morning they should drink Olper’s and everyday they should feed their
pets with Olper’s milk.
There may be some hard core loyal in the milk sector. Loyalty maybe towards such
established brands as Nestle and Haleeb. There might even be switchers and shifting
loyal in the milk sectors that are either price sensitive or want variety. As a result, the
marketers need to find ways to make the hard core loyal attracted to the Olper’s brand
and shifting loyal and switchers to convert into hard core loyal as well.
POSITIONING THE BRAND
Positioning involves designing the product and image that will occupy a distinctive place
in the minds of the target market. As can be seen, nestle milkpak and Haleeb have the
largest profit margins and market share in the milk industry. Thus the marketers at
Olper’s have decided to create its own unique image and then strengthen the position in
the customers’ minds. They have done this by taking a number of following steps:
Packaging of Olper’s milk and Olwell in red color and Olper’s cream packed in
purple color are quite different and distinctive from the typical green and blue
packing used by other competitors.
The brand has been positioned as an all purpose milk that is meant for everyone,
especially for those who live life to the fullest, hence its tag line;
“jo dil khol kay jeetay hain unheen kay liyay hai Olper’s” .
Olper’s always tries to create customer intimacy that is it focuses on satisfying the
customers’ unmet needs. Processed milk is seen as less lacking all the nutrition’s that
are part of milk due to passing through so many processes. But Olper’s positions itself
as milk that has not lost its nutrients.
The unique selling proposition for Olper’s is: “Subah Bakhair Zindagi“, but recently the
company changed the USP to: “Jo dil khol kay jeetay hain unheen kay liyay hai
Olper’s“. Both the tag lines have a very positive impact on Olper’s image because of
the emotions involved in both the lines.
The marketers have used different positioning for Olper’s products:
They have used the attribute positioning for Olper’s milk. The main theme of the
product is that it is meant for all purposes without any user imagery. Olper’s ads
also show attributes of milk such as good for health.
They used the benefit positioning for Olwell. The product is positioned as
delivering the benefit of helping to reduce weight and for healthy bones.
Olper’s cream is positioned as good for a specific use or application. In this case
the cream can be used to make cake icings and desserts look great. It can be
said that all the different stages have been performed by the marketers with
extreme care and research.
COMMUNICATION AND SALE STRATEGIES
POSITIONING THE BRAND
Positioning involves designing the product and image that will occupy a distinctive place
in the minds of the target market. As can be seen, nestle milkpak and Haleeb have the
largest profit margins and market share in the milk industry. Thus the marketers at
Olper’s have decided to create its own unique image and then strengthen the position in
the customers’ minds. They have done this by taking a number of following steps
Packaging of Olper’s milk and Olwell in red color and Olper’s cream packed in purple
color are quite different and distinctive from the typical green and blue packing used by
other competitors.
The brand has been positioned as an all purpose milk that is meant for everyone, especially for those who live life to the fullest, hence its tag line, “jo dil khol kay jeetay hain unheen kay liyay hai Olper’s” Olper’s always tries to create customer intimacy that is it focuses on satisfying the customers’ unmet needs. Processed milk is seen as less lacking all the nutrition’s that are part of milk due to passing through so many processes. But Olper’s positions itself as milk that has not lost its nutrients.
The unique selling proposition for Olper’s is: “Subah Bakhair Zindagi”, but recently the company changed the USP to: “Jo dil khol kay jeetay hain unheen kay liyay hai Olper’s”. Both the tag lines have a very positive impact on Olper’s image because of the emotions involved in both the lines. The marketers have used different positioning for Olper’s products:
They have used the attribute positioning for Olper’s milk. The main theme of the product is that it is meant for all purposes without any user imagery. Olper’s ads also show attributes of milk such as good for health.
They used the benefit positioning for Olwell. The product is positioned as delivering the benefit of helping to reduce weight and for healthy bones.
Olper’s cream is positioned as good for a specific use or application. In this case the cream can be used to make cake icings and desserts look great. It can be said that all the different stages have been performed by the marketers with extreme care and research.
SWOT ANALYSIS
STRENGTH
ENGRO’S BACK
Olper’s is a brand of EFL. This means that consumers can relate their former Image of
EFL to Olper’s. ENGRO is a well established brand name in Fertilizer, IT and
infrastructure business. The brand is well known so customers will automatically have a
brand association with Olper’s and see it as a premium quality product. ENGRO is world
renowned so it can easily attract foreign investors in backing it against other competitors
such as Nestle.
EFL can easily afford research and development costs for Olper’s have in order to
introduce new products. It can also distribute the brand through better channels
because of its long term relationship with distributors in the agriculture sector.
In first year, EFL crossed 1.4 billion sales figure which shows customers’ satisfaction
upon EFL’s products. Its taste, quality proposition and world-class quality proposition
system.
STRONG CONSUMER & PRODUCT RESEARCH
Olper’s done a strong consumer & product research before and after launching the
product. This has provided them the perfect launching pad to eventually emerge as a
global player in the food industry. To develop its future portfolios, EFL has hired various
global research partners like AC Nielsen, Mindshare, JWT Asiatic and MARS marketing
and advertising agencies.
WEAKNESSES
OWNING RED COLOR
The company has not owned the color red like Nestle has a green Milkpak; Haleeb has
a blue carton etc. This may create problems because when a consumer enters a
grocery shop, then he/she might have problems in recalling the brand because there is
no color association attached to Olper’s. The company may need to find a suitable color
in which to focus its upcoming marketing strategies.
LOW QUALITY MILK
EFL is not having its own dairy farms; it largely collects loose milk from farmers
through its 40 milk collection centers, which sometimes is of low quality and impure
because they add vegetable oil to milk to get higher prices.
PACKAGING
EFL is dependent upon Tetra Pak for the packaging of its entire dairy products. Tetra
Pak is the only option available to Olper’s for packaging because it is having monopoly
in the packaging sector in Pakistan. Due to this reason, Tetra Pak can charge them
higher and it could increase the production costs.
MILK COLLECTION & DISTRIBUTION COSTS
EFL’s 34 out of 40 milk-collection centers are located in Punjab, whereas its only milk
processing facility is situated near Sukkhur (Sindh). It increases the milk collection &
distribution costs; and also increases the chances of milk getting spoiled because of
increased travelling time.
NARROW BRAND PORTFOLIO
It has been more than a year now, when EFL launched its first dairy product, Olper’s
Milk on March20, 2006. But EFL’s brand portfolio still consists of just 3 products i.e.
Olper’s Milk, Olwell Milk and Olper’s Cream. Whereas its competitors like Nestle and
Haleeb Foods have a much diversified line of dairy products.
OPPORTUNITIES
INCREASED FUNDING BY GOVERNMENT
Government has decided to increase farmers’ funding. This is an opportunity for
ENGRO foods because previously due to weather conditions and other reasons there
was lots of wastage of milk but now that can be reduced as farmers will be better able to
store milk for longer time periods.
INCREASED CONSUMPTION OF PLM
Competition may create opportunities for the company because each competitor in the
milk industry wants to increase penetration of processed liquid milk and so they will
create awareness for consumers through different advertising media. This will ensure
the increase in the consumption of processed milk instead of lose milk and so will in turn
lead to increase in sales for the company. Therefore there will be an opportunity for
accelerated growth.
AWARENESS
Growing dissatisfaction with loose milk and increasing awareness about health and
hygiene issues have led to increased processed milk consumption.
THIRD LARGEST PRODUCER OF MILK
Pakistan is the Third largest producer of milk in the world with a total production of 32
billion liter of milk a year, whose value is more than that of the combined value of
wheat and cotton, from a total herd size of 50 million milch animals (buffaloes and
cows). Livestock accounts for 46.8 percent of agricultural value added and about 10.8
percent of the GDP. Milk is the largest commodity from the livestock sector accounting
for 51 percent of the total value of the sector. Due to the steps taken by the government
and private sector, country’s annual milk production is expected to grow at an additional
3 billion liters in the next few years. This is quite an opportunity for ENGRO foods as
there is lot of growth in this part of the sector.
THREATS
COMPETITION
Competition may pose a threat because the company will have to maintain its
leadership in an expanding market so that it doesn’t lose its market share to its
competitors. For Olper’s it might be difficult to penetrate in a market where the loyalties
exist for such brands as Nestle and Haleeb. These brands have been in the milk
industry far too long and have left a mark in the minds of consumers in terms of quality.
Competition seems to be getting tougher as a result of new players entering the dairy
market.
PERCEPTIONS AND PRICE DIFFERENTIALS
Consumers’ perceptions and price differentials can cause a threat for the company. It is
important that Olper’s comes up to the expectations of the customers and fulfills its
conformance quality that is the company meets its promised specifications. Consumer’s
preferences change with time and prices might create certain barriers in terms of the
profit margins for Olper’s. For example, lose milk is still cheaper than packaged milk and
that is also one factor that people still prefer to buy lose milk.
RECOMMENDATIONS:
Before lunching Olper’s Milk, Engro spent a lot of money on advertisement but at that
time Olper’s is well known in the market. So, my recommendation to Olper’s is to reduce
the advertisement budget and this amount should be added to CSR’s budget.
They should start to manufacture powder milk in order to meet the domestic demand
and so that it can be helpful in saving the foreign exchange that is expensed in
importing the powder milk from foreign countries.
CONCLUSION:
Olper’s stand committed to sustainable business growth and ensure the safety of their
people, assets and community in which they operate. They repute as a local giant
actively involved with community welfare in remote areas has also been a positive add
on for Engro Foods. Their direction for the brand (Olper’s) is considered one of the
fastest growing FMCG brands in Pakistan. So, they acknowledge consumers for
improving their product.
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