marketing plan for cold bitumen in india

2011

ABHIK TUSHAR DAS 20104001

SANDEEP PRASAD 20104005

VISHAL SHUKLA 20104009

EMBA10’

11/2/2011

Marketing Plan for Cold Bitumen in India

EMBA10: B2B Marketing; Group-8 Project Report

Abhik (20104001) Sandeep (20104005) Vishal (20104009)

Contents:

1. Historical Glance

a. Company perspective

b. Business perspective

2. Situational Analysis

a. Overview of Global business of Bitumen

b. Competitor Analysis

c. SWOT analysis of Market

d. PESTEL Analysis

e. Porter’s 5-forces analysis

3. Marketing Strategy

a. Segmentation of the Market

b. Demand Analysis

c. 4P’s

d. Product Strategy

e. Pricing Strategy

f. Promotion Strategy

g. Customer Relationship Management (CRM)

4. Sales Strategy

a. Channel Strategy

b. Sales Force Management

c. Supply Chain Management (SCM)

d. E-Commerce

5. Marketing Budget

a. Cost-Benefit Analysis

b. Balance Score Card

c. Value-chain-analysis

d. ANSOFF Matrix

6. Key Assumptions

a. Limitations of study

b. Homogenous demand in Market

7. Bibliography



Executive Summary:

Bitumen is the essence of Infrastructure development, roads being the lifeline of an economy. The

demand of Bitumen was of 4.1 MMTPA as against a supply of 3.7 MMTPA due to the emphasis by

National Governments to induct infrastructure development as constituent of long term plans.

India has focussed on Infrastructure development through building of road network in its Eleventh

Five-Year Plan (2007–2012) where projects like Golden Quadrilateral, NHDP (National Highway

Development Project), Bharat Nirman and PMGSY (Pradhan Mantri Gram Sadak Yojana) have been

envisaged. The Union Budget for 2011-12 proposed an allocation of ` 214000 crore for

infrastructure sector, which is 23.3% higher than previous year and amounts to 48.5% of the Gross

Budgetary support to plan expenditure. This provides business houses with an immense potential

for growth and hence major players can leverage their marketing expertise to procure, brand and

distribute Bitumen. The study involves developing a Marketing Plan for Company India for creating

a marketing channel involving Government agencies, Infrastructure companies and contractors.

Company Bitumen in India also supplies ready to use instant road repair premix under brand name

Company MAC PR (Micro-surfacing using Cold Bitumen Emulsions). This allows road to be opened

to traffic within 10-15 minutes and imparts good strength to repaired area. Company Bitumen

product differentiation rests in basic product knowledge, understanding of its complete chemistry,

Quality Control and the technology around it along with its performance on the ground, backed by

global Company bitumen expertise. Company India is more of a solution provider, supplying tailor-

made, fit-for-application and treatment of road products based on customer needs. Company

typically works with the contractor, design and supervision consultant and the owner of airport

runways/ major highways and even with rural roads to provide the most suitable and best product

suited to their application, product needs and local conditions.

The cold in-place recycling (CIPR) is a process where the existing bituminous pavement is recycled

without application of heat. In CIPR process the scarified material from the existing pavement is

crushed to the required gradation and binder in cold form (emulsion or cutback or foamed

bitumen) is added. Externally acquired Reclaimed Bituminous Pavement (RBP) or fresh aggregates

are also added depending on the requirement. The material is mixed in-situ, compacted, and left

for curing. During this process additive like, cement, quick lime, fly ash is also used.



1. Situational Analysis:

a. Overview of Global business of Bitumen

Naturally occurring bitumen has been around for many thousands of years; a recording of a

bituminous substance is found in the Bible. From the late nineteenth century onwards demand for

bitumen has been increasing, Company began major bitumen production in the UK in 1920 with

the opening of the Company Haven refinery. Company Bitumen operates for more than 85 years

with global experience and local knowledge and offers dedicated account management, seeking to

provide cost-effective bitumen solutions to meet business needs - be it industrial, professional,

trade or domestic consumption. Also known as Asphalt, bitumen is a sticky, black and highly

viscous liquid or semi-solid that is present in most crude petroleum and in some natural deposits, it

is a substance classed as a pitch, and is used in road construction, where it is used as the glue or

binder mixed with aggregate particles to create asphalt concrete. Its other main uses are for

bituminous waterproofing products, including production of roofing felt and for sealing flat roofs.

Global asphalt producers such as BP Plc, Exxon Mobil Corporation, Petroleos de Venezuela SA,

Royal Dutch Company plc, Akzo Nobel, Anglo American, Atlas Roofing Corporation, Aggregate

Industries Limited, CEMEX UK Operations Limited, CertainTeed Corporation, Colas Denmark A/S,

CRH PLC, Dehtochema, GAF Materials Corporation, Hanson, Husky, Lafarge SA, Nynas AB, Oldcastle

Materials, Inc., Owens Corning, Paramo, SemGroup Corporation, Sinopec, and Skanska AB.

World demand for asphalt is forecast to expand 2.1 percent annually from a weak 2008

base to 108 million metric tons in 2013, equivalent to 655 million barrels of primary asphalt. The

world’s most developed asphalt markets (North America, Western Europe and Japan) will post

moderate gains in demand. In China and India, growth in demand will remain well above the world

average, although gains will decelerate. For the rest of the Asia/Pacific region, gains will be about

average but will outpace the mature West European and North American markets. In Latin America

and the Africa/Mideast region, decelerating growth in road building activity and construction

spending will lead to reduced opportunities for asphalt. Paving products accounted for more than

80 percent of total asphalt demand the remaining 20 percent is attributed to water-proofing

products.

b. SWOT analysis of Bitumen Market

Strength: Inelastic Demand (universal)

Weakness: Low product differentiation

Opportunities: Growing Markets (India & China)

Threats: Monopolies (National Oil Companies)

SWOT



Strengths: Demand for Bitumen as a product is universal in nature due to unavailability of

product substitutes as a Road Paving Medium. Apart from construction of cement roads which is

costlier than Asphalt, no other medium is used for road construction. This leads to an inelastic

market demand wherein consumption volumes are seldom affected by economic imbalances. Most

infrastructure development projects are funded by Sovereign National Governments or

international funding agencies like World Bank and hence market demand is stable.

Weakness: As a product, Bitumen is differentiated by its grades determined by

“Penetration Test”. Penetration @ (25°C; 0.1 mm 100 gm, 5 sec) BIS 1203:

1. 30 to40 milli-meter

2. 60 to 70 milli-meter

3. 80 to 100 milli-meter

As Bitumen is a residual by-product of Petroleum Refining, it is available in all the refineries across

the globe. Bitumen when processed further develops properties which can be graded based on its

softness. Specifications of materials and road are governed by BIS, IRC.

Opportunities: Asian economy has been growing at a stealthy pace, India and China being

its economic drivers. The economic growth is supplemented by a need for infrastructure growth

and hence the enormous market potential for the product. The Chinese government rolled out a

series of stimulus packages to boost domestic demand in both infrastructure investment and

consumption in a bid to bolster economic growth.

China Road Projects

Region Kilometres Open to traffic (kms)

1. Northeast China: Liaoning, Jilin, Heilongjiang 6,127 kms

2. North China: Beijing, Tianjin, Hebei, Shanxi, Henan, Inner Mongolia 10,257 kms

3. Northwest China: Xinjiang, Qinghai, Gansu, Ningxia, Shaanxi 6,496 kms

4. Southwest China: Chongqing, Yunnan, Guizhou, Sichuan, Tibet 7,929 kms

5. Central China: Jiangxi, Anhui, Hunan, Hubei 10,103 kms

6. South China: Guangdong, Guangxi, Fujian, Hainan 7,056 kms

7. East China: Shanghai, Zhejiang, Jiangsu, Shandong 2,309 kms

Indian Road Projects Region Kilometres Open to traffic (kms)

1. Golden Quadrilateral - Connecting Delhi-Kolkata-Chennai-Mumbai 5,846 Kms

2. North-South and East-West Corridors connecting Kashmir to Kanyakumari including Salem to Cochin Spur and Silchar to Porbandar 7,300 Kms

3. 4-laning of (NHDP Phase- III) accelerated road development programme for the North Eastern region 10,000 km

4. 2-laning with paved shoulders of National Highways under NHDP Phase-IV 20,000 km

5. 6-laning of GQ and some other selected stretches under NHDP Phase-V 6,500 km

6. Development of express ways under NHDP Phase-VI 1,000 km

7. Development of ring roads, bypasses, grade separators, service roads, etc. under NHDP Phase-VII



Threats: In the Indian scenario, refining of petroleum products were controlled by state

owned Public Sector Undertakings (PSU) till late 1900’s. However post liberalization, the sector was

opened up for private participation and thereafter during 1998-2002, the Administered Pricing

Mechanism (APM) was finally dismantled allowing a fair remuneration for private marketers.

Though private Oil and Gas majors have made significant investments in Oil Marketing the

dominance of National Oil Companies still gives the PSU’s an advantage in the market.

Country Annual Tonage

BIT. Emulsion Bitumen Percentage

USA 3,166,000 26,000,000 12.2%

France 1,200,000 2,800,000 42.9%

Spain 440,000 1,600,000 27.5%

Germany 168,000 2,780,000 6.0%

Japan 334,996 4,418,000 7.6%

Sweden 69,000 492,000 14.0%

Australia 80,000 607,000 13.2%

Austria 21,000 386,000 5.4%

Brazil 420,000 1,330,000 31.6%

South Africa 120,000 300,000 40.0%

Mexico 45,000 266,360 16.9%

Saudi Arabia 12,000 89,000 13.5%

Turkey 20,000 600,000 3.3%

Romania 30,000 200,000 15.0%

India 30,000 2,500,000 1.2%

Ex-Refinery prices exclusive of taxes (Rs. /Metric tonne) Applicable from: November 01, 2011

BITUMEN GRADES

VG-10 VG-30 VG-40

PORT REF(Mumbai/Manglore/Kochi) 33660 34460 36830

KOYALI 33660 34460 36830

MATHURA 34860 35660 38030

PANIPAT 35160 35960 38330

PORT REF (Haldia/Vizag/Chennai) 33760 34560 36930

BARAUNI 34790 35590

BITUMEN (PACKED)

PORT REF(Mumbai/Manglore/Kochi) 36660 37460 39830

KOYALI 36660 37460 39830

MATHURA 37860 38660 41030

PANIPAT 38160 38960 41330

PORT REF (Haldia/Vizag/Chennai) 36760 37560 39930



c. Political, Economic, Social, and Technological, Environmental and Legal analysis (PESTEL)

Factors which influence business decisions:

Political factors: Thrust by Central Govt. on development of roads. Many State

Governments also giving thrust on road developments

Economic factors: The GDP is planned to grow at rate of 7-8% in future. The

interest rates are increasing; Government has allowed Private Sector Participation.

There is huge requirement of funds. Government is trying to generate resources by

innovative methods. The Rupee has weakened.

Social factors: The citizen of the country has started realizing benefits of good

roads. Even roads are canvassed for votes. There will be pressure from the citizens

for good quality roads

Technological factors: Automated Plants for value added bituminous products.

Refineries updating technology of Bitumen Production.SAP being used by Oil

Companies Customers using advanced technology.

Environmental factors: The Bitumen market will expand and the demand of value

added Bitumen will grow. Quality Bituminous products will be available. The market

for generic product may continue. The customers will demand quality and services

and will prefer from using value added Bitumen

Legal factors: Contract enforcement, legal recourse, appellate body, civil rules.



d. Porter’s 5-forces analysis

Applying Michael Porter’s 5-forces Model to the Cold Bitumen Markets in India, we can

analyse the following points;

SUPPLIER BARGAINING POWER

a. Supplier concentration: Low

b. Importance of volume to supplier: High

c. Differentiation of inputs: Low

d. Impact of inputs on cost or differentiation: Low

e. Switching costs of firms in the industry: Low

f. Presence of substitute inputs: Low

g. Threat of forward integration: High

h. Cost relative to total purchases in industry: Low

Competitive Rivalary

Supplier Bargaining

Power

Threat of New Market

Entrant

Customer Bargaining

Power

Threat of Substitute

Product



BUYER BARGAINING POWER

a. Bargaining leverage: High

b. Buyer volume: High

c. Buyer information: High

d. Brand identity: High

e. Price sensitivity: High

f. Threat of backward integration: Low

g. Product differentiation: High

h. Buyer concentration vs. Industry: Low

i. Substitutes available: High

j. Buyers' incentives: High

THREAT OF NEW ENTRANTS

a. Absolute cost advantages: Low

b. Proprietary learning curve: High

c. Access to inputs: Low

d. Asset specificity: Medium-High

e. Government policy: Low-Medium

f. Economies of scale: Medium-High

g. Capital requirements: Medium-High

h. Brand identity: High

i. Switching costs: Low

j. Access to distribution: Low

k. Expected retaliation: High

l. Proprietary products: High

THREAT OF PRODUCT SUBSTITUTES

a. Switching costs: Low

b. Buyer inclination to substitute: High

c. Price-performance trade-off of substitutes: High

DEGREE OF RIVALRY

a. Exit barriers: Medium-High

b. Industry concentration: High

c. Fixed costs/Value added: High

d. Industry growth: Medium-High

e. Product differences: High

f. Switching costs: Low

g. Brand identity: Low-Medium

h. Diversity of rivals: Low-Medium



Summarizing Michael Porter’s 5-Forces model of pure competition in seeking to develop an

edge over rival firms by understanding the industry context in which the firm operates we observe

that;

a. Supplier bargaining power is low on account of low concentration ratio of suppliers

as Bitumen is a residual product of Petroleum refining and is thus available across

different suppliers.

b. Buyer bargaining power is high as Bitumen as an end product is used for Paving

Roads where purchase tenders are floated by large infrastructure contractors or

Government agencies and the volumes traded are high with long term purchase

agreement.

c. Threat of New Entrant is high as Bitumen handling involves moderate fixed

investments where the business switching cost is high. As Bitumen is classified as a

Class-C Petroleum Product with Flash point >95 degree Celsius; petroleum storage

license is not necessary from The Petroleum and Explosives Safety Organisation

(PESO).

d. Threat of Product Substitutes is high as Cold Bitumen as a product for Road Paving

can be substitutable with Conventional Bitumen which is a low cost affair. Also

there is low product differentiation within Bitumen as a product.

e. The Degree of Rivalry in the Bitumen Market is high as the market concentration is

low owing to large number of players in the market. Low entry barriers, low

technological complexity and high bargaining power of the buyer have contributed

to the high market dynamics.

2. Marketing Strategy:

a. Segmentation of the Market

Whereas earlier roads were built with the primary aim of moving passenger traffic only,

roads today need to take care of extensive movement of goods through heavy load axles on the

road due to explosive economic growth. Thus the road designs need to be suitably upgraded to

take care of present load and traffic intensity conditions on the roads. Also, certain parts of the

country are subjected to heavy rainfall or heavy snowfall. India’s legacy road infrastructure as well

as paving modern Highways and Airports of tomorrow needs application of High end products and

technologies as there is a massive legacy road network that has weak base and cannot be upgraded

overnight but need to be maintained using maintenance applications. Also remote roads do not

have the facility of transporting and using conventional Bitumen thereby creating a demand for

Cold Bitumen.



Segmentation of the Market;

Main Roads: Paving solutions to withstand the demands of high volume inter-city road

networks and highways

Urban Roads: Pavement solutions to withstand the needs of busy urban areas.

Rural Roads: Road network for rural areas, particularly in developing countries.

Heavy Duty Roads: Airports, ports and railways require paving solutions that can

withstand extremely heavy loads and high pavement stress

Industrial Roads: Core applications include roofing, flooring and sealing. Roads within the

Oil & Gas industry use Cold Bitumen to avoid possibility of Hazard due to heating of

conventional Bitumen during application.

b. Demand Analysis

Demand for Bitumen can be categorized into;

Long-run demand: These supplies are made through tendering and purchase contracts

wherein Bitumen is supplied to customers in long term consignments.

Short-run demand: these supplies are made through direct ad-hoc purchase of retail

drums

The demand for road infrastructure projects can be estimated from the following facts;

Annual growth projected at 12-15% for passenger traffic, and 15-18% for cargo traffic

Investment in road sector during the Eleventh Plan is projected at $ 78.50 billion

The Government is planning to increase spends on road development substantially with

funding already in place based on a cess on fuel

100% FDI under the automatic route is permitted for all road development projects

100% income tax exemption for a period of 10 years



The Golden Quadrilateral and NSEW projects map:

c. 4P’s:

Product: Cold Bitumen as a product is nascent in its use being an innovative concept

over conventional Bitumen. The product is used in specialized Paving jobs where

conventional Bitumen is unfeasible or impractical. The product needs to be promoted as

a hassle free value added service for quick repair of roads.

Price: The price of the product should be premium, wherein the operational benefits of

the product should ensure cost savings over conventional Bitumen. The price should

also be competitive such that bulk purchases of Conventional Bitumen do not offset

purchase decisions for Cold Bitumen.

Place: Cold Bitumen is mainly applied on Road Paving repairs and hence the marketing

place should be small time contractors who undertake patch work. These contracts are

either awarded by Municipal contracts or Private companies.

Promotion: B2B promotion should target business publications, trade shows, direct

mailers and direct selling.



d. Product Strategy

Company India has developed a comprehensive specialist product portfolio designed to

meet the needs of every user, industrial, professional or domestic. Bitumen products are tailored

to meet the needs of asphalt manufacturers, road builders, construction, government,

communities, asset owners, designers and architects giving usable and effective solutions for all

manner of markets.

The product offerings can be categorized into;

Company Cariphalte: Specially formulated polymer modified bitumen based on carefully

chosen combinations of bitumen and thermoplastic elastomers.

Company Mexphalte CRMB: Modified Bitumen manufactured using Crumb Rubber and

specially selected modifiers

Company Low Temp Binders: Ready-to-use solution for time and cost saving in road

construction designed to lower the mixing or laying temperature of asphalt compared to

a conventional asphalt mixture

Company Instapave: A cost-effective solution to pave rural roads

Company Mexphalte C: A clear synthetic binder that can produce asphalts in a broad

spectrum of colours, enabling the colour-matching of pavements to the local

environment

Company Spramul: Spray-able emulsified versions

Company-mac PR: An instant all-weather pothole repair solution

Standard Grades: 30/40, 60/70, 80/100 based on penetration tests

e. Pricing Strategy

The pricing strategy for Company India will depend upon the following two factors;

Standard grades to be priced competitively: Standard grades (based on penetration

tests) are widely available in the market under various brand names; hence to compete

with smaller brands the pricing strategy should be competitive. These products offer

core benefits to the customer and hence assess the product value based on cost-

benefit, demand elasticity and switching cost. Once the purchase has been made and

the customer is satisfied, they become less price sensitive overtime.

Specialized products are priced at a premium: Specialized offerings pricing strategies are

value based, which depend on the add-on benefits offered by the product over the core

benefits. The price of such products is based on product quality, innovative offerings,

dynamic delivery and strong product service. These products can also be priced based

on Target costing based on types and quality attributes required to succeed in a

particular segment.

New product offerings can be priced on a continuum of skimming (initial high price) to

penetration (initial low price) pricing strategies.

Competitive bidding strategies involving bulk supplies of Bitumen can involve either

closed bidding or open bidding strategies.

http://www.shell.com/home/content/ind/products_services/solutions_for_businesses/bitumen_tpkg/products/shell_mexphalte_c/

http://www.shell.com/home/content/ind/products_services/solutions_for_businesses/bitumen_tpkg/products/shell_spramul/

http://www.shell.com/home/content/ind/products_services/solutions_for_businesses/bitumen_tpkg/products/standard_emulsion_oxidised/



f. Promotion Strategy

Use of Social Media for Business Communication:

The target audience for Bitumen promotion can be enumerated as;

Municipal bodies: The advertisement should send a clear message about the core

benefits of the product which would influence their purchase decisions. Direct mails to

procurement departments. Creating awareness among procurement officers about the

quality and price edge of the product over its rivals can help in securing delivery

contracts.

Government contracts: Organizing Trade shows to display new advancements and

technological developments to mass audiences where customers can get hands on

experience on the products, new customers can be identified and a general goodwill

would be created for the company.

Industrial use: Promotions in Business Publications creating awareness among business

houses.

Retail use: Use of social media to connect the brand with Small-Medium Users along

with use of Bill-Board displays, print advertisement.



g. Customer Relationship Management (CRM):

Customer Relationship Management can be widely defined as company activities related to

developing and retaining customers. It is a blend of internal business processes: sales, marketing

and customer support with technology and data capturing techniques. Customer Relationship

Management is all about building long-term business relationships with customers.

Operational CRM:

Delivers personalized and efficient marketing, sales, and service through multi channel

collaboration.

Enables a 360-degree view of your customer while you are interacting with them.

Sales people can access complete history of all customer interaction with the company,

regardless of the touch point

Replenish field stock of old and outdated material with new stock

Analytical CRM:

Acquisition: Customers from conventional Bitumen usage

Retention: Retaining customers for subsequent purchases/ contracts.

Information: Providing timely and regular information to customers.

Modification: Altering details of the transactional nature of the customer’s relationship

Collaborative CRM:

Enables efficient productive customer interactions across all marketing channels.

Enables web collaboration to reduce contract costs.

Integrates call centres enabling multi-channel personal customer interaction.

Integrates view of the customer while interaction at the transaction level

Enables the company to get updates about product usage, expectations and shortfalls to

maintain product quality standards in line with customer needs

Extend credit to small contractors who lack purchasing power for the new product

Operational CRM

Analytical CRM

Collaborative CRM



3. Sales Strategy:

a. Channel Strategy

Bitumen is sold through the following broad channels;

Direct Bulk distribution through road tankers (Direct Channel): Direct selling

through tenders and contracts wherein no channel intermediaries are

involved. Mostly these consignments are long term supply contracts and

hence economies of scale strategies in distribution are adopted to maximise

channel efficacy.

Retail distribution through packed drums (Indirect Channel)

Bitumen sold through drums involves channel intermediaries which can be in

the form of distributors or manufacturers representatives. The end users for

the retail Bitumen are industrial units, water-proofing contractors, and small

road repairs. Company’s specialized offerings are also distributed through

retail outlets which serve specific customer segments.

Lead Generation

Lead Qualification

Bid & Proposal

Negotiation & Sales Closure

Fulfillment

Customer Care &

Support



b. Supply Chain Management

It is an innovative approach to tighten the distribution process, bolster links with

suppliers and customers and integrating organizational functions like production

and marketing.

The Bitumen Value Chain:

Integrating business processes from customers to suppliers can help improve system

efficiency through Supply Chain Management wherein information travels opposite to flow of

materials. Real-time information sharing between different stakeholders of the system can ensure;

Better quality control of product (waste reduction): Coordination between

site, vendor and supplier leads to low rate of consignment rejection.

Minimum inventory requirement: Bitumen solidifies at room temperature

(pour point > 90 degree Celsius) and hence high inventory leads to high

heating cost and hence high cost of ownership.

Continuous improvement of product: Feedbacks from vendors can be utilized

to improve product quality on a continuous basis.

Low lag time between order, processing and delivery: Better business process

integration can also result in avoiding unnecessary project delays due to

unavailability of Bitumen on time.

Refinery Terminals Processing Distributor Wholesaler Customer

Direct Distribution Channel



c. E-Commerce

E-commerce is a cost effective way of doing business through the aid of

Information Technology. Business through E-commerce is achieved through a

virtual market which serves as a global platform for the commodity. Company India

has an active marketing strategy for its products (Bitumen) through the E-

Commerce platforms.

B2B Solutions on E-Platform:

E-Commerce includes processes like;

E-Auctions/ E-Trading

E-Tendering

Internet marketing

Online transaction processing

Electronic data interchange (EDI)

Inventory management systems



Company E-Trading Platform:

Other E-Commerce Platforms for Bitumen Trading:

E-Commerce helps in connecting the buyer and the seller on a virtual platform wherein the price-

discovery happens at a much rational level. It also leverages small players to compete with large

players offering them a level playing platform to conduct business. E-Commerce also helps reduce

the transaction cost of the process, thus reducing the TCO (Total Cost of Ownership) of the

product.



4. Marketing Budget:

e. Cost-Benefit Analysis

Cost-benefit analysis is a means of evaluating all of the potential costs and

revenues that may be generated if the project is completed, the outcome of such analysis will

determine whether the project is financially feasible, or if another project should be pursued.

Principles of cost benefit analysis;

There must be a common unit of measurement

Valuations should represent consumers or producers valuations as revealed by their actual

behaviour

Benefits are usually measured by market choices

Cost benefit analysis involves a particular study area

The marketing plan budget allocation should consider both tangible and intangible aspects of cost

and benefit in the long run. The allocation of budget to specific marketing channels for Bitumen

would consists of aspects like dealer margin, bulk discounts, customer benefit campaigns and

budgets for trade shows.



f. Balanced Scorecard

The balanced scorecard is a strategic planning and management system that is

used extensively in business and industry to align business activities to the vision and strategy of

the organization, improve internal and external communications, and monitor organization

performance against strategic goals.

Customer benefits:

Corrects most of the types of pavement distresses e.g. raveling, rutting, corrugation,

shoving etc.

Hauling cost is considerably low

Air quality related problems during construction is almost negligible as compared to the

hot mix process

Since this process does not involve application of heat, premature aging of bitumen also

can be avoided

More durable in freeze-thaw situations, compared to hot mix recycled pavement

Financial:

Brand the product as a premium product with differentiation in product application with

enhanced features than conventional Bitumen

Customer:

The product should reflect the brand value premium with significant positioning of the

technological superiority

Internal Business Processes:



Robust processes should be incorporated to excel in distribution to gain an edge over

conventional Bitumen

Learning & Growth:

Product innovation through customer feedback and trial applications through contractor

relationship would ensure product development of Cold Bitumen in the long run.

g. Value-chain-analysis

Analyzing the Bitumen Value Chain (through primary activities);

Inbound Logistics: For Company Bitumen, the inbound logistics would include

procurement of Bitumen from refineries, its transportation including intermediate

warehousing. Each step of the value chain is associated with costs which tend to

cumulate and add up to the final product price. The cost of storage and logistics

can be a high percentage of the final cost due to the heating requirements for

keeping the Bitumen in liquid stage during bulk transportation. Special insulated

trucks having internal heating arrangement are used for transporting Bitumen over

long distances.

Operation: The Bitumen is processes in units to modify its characteristics to suit the

needs of the end users. The cost of operations includes production cost, packing

cost, setup cost and labour cost.

Out-bound logistics: The distribution of Bitumen from the processing plant to the

end user can be done either through direct bulk delivery or through packed drums.

The delivery through drums involves many stages wherein the drums are packed



and stored in distributor warehouses from where it is supplied to retailers. The

processed Bitumen can be re-liquefied by heating and hence does not involve high

cost of heating during transit/ storage. Bitumen packed in drums can be liquefied

at customer location; some modified versions of Bitumen can be applied by mixing

it with pre-required solvents.

Sales and Marketing: A major part of value addition can be attributed to the sales

and marketing effort of any organization, Bitumen marketing being no different.

Creating awareness for the customer regarding new innovative concepts of paving

as well as information to various Governmental agencies to qualify for bidding

process jacks up the cost of the product. Advertisements, trade promotions,

sample distribution as well as demonstrations are also counted under the head of

Sales and Marketing costs.

Servicing: Product after sales service in Bitumen marketing consists of post

application visits to ascertain product effectiveness and durability of product.

Companies need to constantly monitor the performance of the product and gather

customer feedback regarding difficulties faced by the end user.

Secondary activities-Bitumen market is highly competitive with presence of a large

number of players forcing major players to leverage support functions like Technology to get past

smaller players in terms of margins. The value added to the product through the value chain, less

the cost incurred thereof is the net margin to the marketer.

h. ANSOFF Matrix

The first three strategies of the ANSOFF Matrix are usually pursued with the same

technical, financial, and merchandising resources used for the original product line, whereas

diversification usually requires a company to acquire new skills, new techniques and new facilities.

Company India marketing strategy involves introduction of innovative products in its product

portfolio which necessarily caters to the existing market for Bitumen which can be termed as a

traditional market.



Company India product range can be categorized into the ANSOFF Matrix;

6. Key Assumptions

a. Limitations of study: The study limits itself to marketing of Cold Bitumen (processed) in

India by Company India. As the product is conceptualized as a new launch product, sales

data, prices, and costs were not accounted for in formulating the marketing plan. The study

also relies upon secondary data for conceptualizing the Market analysis. The study being

part of the B2B course curriculum is not intended to make any judgements or market

predictions about the Bitumen business markets. Facts and figures mentioned in the data

might not be accurate but serve as an illustration for visualizing the market dynamics.

b. Homogenous demand in Market: The market conditions and the demand pattern is

considered as homogenous across the country and any geographical and seasonal

variations in demand is excluded from the scope of the study. The announced investments

to be made by the Government are assumed as constant with a linear growth rate. The sole

purpose of the study is to make readers aware of the process of B2B marketing and should

be excluded from the purview of market study. The study also excludes any

representations from Company India and hence there is no commitment from the

organization towards the facts shared in this study.

•Instapave, Company Mexphalte

•CompanyCariphalte, Company Multiphalte

•Bitufresh, Company Spramul

•Company WAM Foam

•Standard, emulsion and oxidised grades

Market Penetration

Product Development

DiversificationMarket

Development



7. Bibliography

http://home.iitk.ac.in/~adas/article10.pdf

http://www.iocl.com/Products/Bitumen.aspx

http://www.Company.com/home/content/ind/aboutCompany/Compa

ny_businesses/india_business_structure/Company_bitumen_india/

http://www-

static.Company.com/static/idn/downloads/Company_for_businesses/b

itumen/data_sheets/flinkote3.pdf

http://books.google.co.in/books?id=bA1tIkRJL8kC&pg=PA113&lpg=PA1

13&dq=cold+bitumen+Company&source=bl&ots=pbOcJmC_-

Y&sig=GzNj5c9NaskOjxo0dWjnMiG7iDY&hl=en&ei=peSyTovrKM3wrQe

64MTJAw&sa=X&oi=book_result&ct=result&resnum=5&ved=0CD8Q6A

EwBA#v=onepage&q=cold%20bitumen%20Company&f=false

http://en.wikipedia.org/wiki/Asphalt

http://www.saudiaramcoworld.com/issue/198406/bitumen.-

.a.history.htm

http://en.wikipedia.org/wiki/Customer_relationship_management

http://www.quickmba.com/strategy/porter.shtml

http://www.iitk.ac.in/infocell/announce/convention/papers/Changing

%20Playfield-06-Saurabh%20Kumar%20Saxena.pdf

http://www.b2bmarketingplan.com/

http://tutor2u.net/business/strategy/ansoff_matrix.htm

http://www.renewal.eu.com/resources/Renewal_Pestle_Analysis.pdf

http://home.iitk.ac.in/~adas/article10.pdf

http://www.iocl.com/Products/Bitumen.aspx

http://www.shell.com/home/content/ind/aboutshell/shell_businesses/india_business_structure/shell_bitumen_india/

http://www.shell.com/home/content/ind/aboutshell/shell_businesses/india_business_structure/shell_bitumen_india/

http://www-static.shell.com/static/idn/downloads/shell_for_businesses/bitumen/data_sheets/flinkote3.pdf



http://books.google.co.in/books?id=bA1tIkRJL8kC&pg=PA113&lpg=PA113&dq=cold+bitumen+shell&source=bl&ots=pbOcJmC_-Y&sig=GzNj5c9NaskOjxo0dWjnMiG7iDY&hl=en&ei=peSyTovrKM3wrQe64MTJAw&sa=X&oi=book_result&ct=result&resnum=5&ved=0CD8Q6AEwBA#v=onepage&q=cold%20bitumen%20shell&f=false





http://en.wikipedia.org/wiki/Asphalt

http://www.saudiaramcoworld.com/issue/198406/bitumen.-.a.history.htm

http://www.saudiaramcoworld.com/issue/198406/bitumen.-.a.history.htm

http://en.wikipedia.org/wiki/Customer_relationship_management

http://www.quickmba.com/strategy/porter.shtml

http://www.iitk.ac.in/infocell/announce/convention/papers/Changing%20Playfield-06-Saurabh%20Kumar%20Saxena.pdf

http://www.iitk.ac.in/infocell/announce/convention/papers/Changing%20Playfield-06-Saurabh%20Kumar%20Saxena.pdf

http://www.b2bmarketingplan.com/

http://tutor2u.net/business/strategy/ansoff_matrix.htm

http://www.renewal.eu.com/resources/Renewal_Pestle_Analysis.pdf

marketing plan for cold bitumen in india

Self Improvement

company india

marketing plan

thedemand of bitumen

cold bitumen emulsions

major bitumen production

marketing expertise

marketing strategya

company perspectiveb