Marketing Strategy Report

On

Submitted to

Prof. Beena Mathen

Complied by:

Group 1

Calvin Pinto

Fedora D’souza 76

Samir Vele 108

Table of Contents

Index Page No.

About the project 01

Objective 02

Vision 03

Mission 03

Market Strategies 04

Positioning 05

4 P’s 07

Financial Analysis 13

BCG Matrix 15

Competitive Analysis 17

Future Scope 18

Reference 19

ABOUT THE PROJECT

It is known that in a country like India, hygiene is a factor given prime importance especially

relating to ones bathroom habits. But as one grows older, relieving oneself becomes more tedious

and difficult.

This project thus deals with a business analysis relating to the manufacturing and marketing of

adult diapers. We believe that it is an untapped market with a lot of small players that are

scattered throughout the country.

Also, besides foreign players, there are no branded national players in the market. So, it provides

a lot of opportunity to new players like us to establish ourselves in the market.

This project includes the vision, mission, objectives, marketing mix, financial analysis, BCG Matrix and Competitive Analysis for the product.

OBJECTIVE

Our primary goal will be to establish and strengthen our existence in the market, which will be

bestowed by the business environment in which we function.

We realize the fact that for us to prosper in this relatively untapped market there is need to be

flexible and responsive, to delight our customers by providing them with what they want, when

they want it and in the exact quantity.

Our business strategy will revolve around the need to provide quality disposable adult diapers to

the various institutions and wholesalers that need them, in the process of fully satisfying their

requirements. This shall be undertaken through adequate training and recruitment of a

professional team dedicated to providing and catering the customer's needs.

We intend to ensure that our marketing campaign increases the knowledge of our products and

services to the various market segments we shall be targeting. We also intend to have well laid

out introductory promotional material that will enable clients to have an understanding of the

product and advantages of utilizing the product hence this will undoubtedly generate increased

sales of our products.

Vision:

We intend to focus on delivering quality products at affordable prices that in turn will produce

good referrals, which can subsequently generate good amount of revenue over a period of time.

Mission:

To create products which cater to the need of our esteemed customers and esteemed communities

to live a healthy and comfortable life.

Internally we intend to create and nurture a healthy, productive, satisfying and enjoyable

environment, in which our employees are fairly compensated and encouraged to respect the

customers' requests and the quality of the products we intend to produce. We seek fair and

responsible profit, enough to keep the company financially healthy for the short and long term,

and to fairly remunerate employees for the work and effort.

MARKET STRATEGIES

We intend to implement a progressive marketing strategy. In terms of marketing we intend that

our name and products are marketed on an extensive basis to ensure that customers are aware of

our existence. In price, we intend to offer reasonable and competitive prices in comparison to the

local and foreign competitors and we need to sustain that. Our marketing will strive to ensure

that we establish long relationships with clients.

Market Scope strategy:

Single Market strategy -since we are catering to niche segment of market in India whose needs

are different and compliant

Market Geography strategy:

Local to Regional- Primary target is to target the state of Maharashtra. In our strategy we will

initially target prime cities in the state (Mumbai, Pune, Nashik, Nagpur, Aurangabad, and

Solapur) and spread to the rest of the state and (assuming that the product is well accepted) to the

western region of the country.

Market Entry strategy:

We are to be Early Followers in this market since there are no markets leaders so far; however

there are many local players in the market.

Market Commitment:

Since we are new businessmen in the market we have a medium commitment towards the initial

stage of production. We hope to establish a higher commitment as soon as we taste success in the

industry especially our target region.

Positioning

Basically we are positioning our product based on its Features and the basic needs of the Target

Audience.

We intend to position ourselves as a desirable alternative source of high quality disposable

geriatric/adult diapers. This shall be undertaken through use of high quality raw materials and

production processes so as to ensure the efficient delivery of quality products.

The product strategy will also be based on quality, combined with making the product easily

available to the customers. Our faster delivery, relative to our other counterparts, will also serve

as an important competitive advantage on the market.

Through our lower prices, made possible by reduced local delivery charges, we intend to attract a

large portion of the market, both directly and indirectly through referrals.

Positioning in the market:

Challenger: We hope to command a strong position in the local market and take up the share

among the local players.

One -Price Strategy:

The same price is set for all customers who purchase goods

Product Design Strategy:

Standardized: - Common for everybody, only difference in size.

4P’s

Product:

Adult diapers is specially designed for physically challenged / old people aged from 45 & above.

These diapers would be disposable. It would be available in different sizes i.e. Small, Medium

and Large it has refasten able tapes and it locks on the wetness.

These are mainly used in medical institutions such as hospitals and clinics where patients often

require disposable pads to overcome the problem of dirty, smelly and wet bottoms. This is

particularly so as these adult patients are incontinent and often do not have the ability to control

their bladder.

Pricing Strategy:

Rapid penetration (high promotion, less price: We intend to offer reasonable and competitive

prices in comparison to local competitors and we need to be able to sustain that.

Adult diapers products will be competitively priced in relation to its competitor's products. Due

to the introductory nature of our products we intend to implement a penetration pricing strategy

which will ensure that potential customers are attracted by our lower prices, up until our products

are fully appreciated on the market, especially in terms of their quality. We will initially charge

Rs 200 for a pack of 5 and Rs 380 for a pack of 10. However this will dictate that our costs are

prudently kept so as to ensure our financial goals come to fruition.

Distribution Strategy:

Hospitals, Wholesalers, Super/hyper market, departmental/general stores and ashrams /old age

home. Our products shall initially be mainly sold through personal selling and referral business,

with relationships and customer experience being, by far, the most important factor.

Relationships in this regard means establishment of links with the various wholesalers, hospitals

and clinics which often order or require our products for their customers. Invariably the

experience a customer has with our products will go a long way toward influencing the

intermediary to continue to order our products, and they should refer their peers to order our

products. To this end we intend to ensure we provide a quality product with superior absorbency

and comfort.

Distribution Channel:

The distribution of the product would be done in the following pattern:-

Manufacture Wholesaler Retailer Household Customers

This pattern of distribution would be chosen for efficiently & effectively distribute the product.

By eliminating the Agents/Brokers we save a huge sum of resources which can be used for other

promotional and advertising activities which can boost the sales and help us to grow

Distribution scope strategy:

Intensive Distribution: The product will be available at all possible retail outlet. It will be

available at almost all retail outlets in an area. The distribution of the product would be done in

an effective way by this method.

Advantages: 1) The sales volume would be increased

2) The product will get wider customer recognition across the area

3) The product would be available at almost all stores

Disadvantages: 1) It is low priced and low margin product which requires a fast turnover

2) The degree of control on the retailers is minimal

Promotion Strategy:

We intend to promote through medical shops, clinics, supermarkets, personal selling, and

medical camps. The promotion strategy shall initially revolve around informing customers of our

existence, the products we produce, and from where to buy them. The intention will be to

highlight the following key benefits of ordering our products instead of competitors, including:

Our lower production costs which will convert to getting product at competitive rate

Quality products able to compete with the top brands.

Faster order fulfilment times.

We intend to be well known by all our stakeholders in particular wholesalers, hospitals, old age

homes and other such institutions that may utilize our products, as well as informal traders.

Hence we shall leverage our presence using introductory letters, brochures and other sales

literature. We intend to spread the word about our business through the following:

1. Personal Selling. Undoubtedly customer solicitation face-to-face will be our most

powerful form of promotion mainly due to the fact that our products are mainly ordered

by individuals in organisations and institutions. Its flexibility will enable us to give our

customers concise details of what we have to offer and the benefits of using our products.

Another important determinant in utilizing personal selling is the fact that we are

relatively new on the market. As such potential customers/clients will to a certain degree

be sceptical towards our product.

2. Advertising. We intend to undertake adequate advertising of our name and product we

offer. This is to create awareness and knowledge of our existence in the market place,

which hopefully shall convert into market share. A constant look out will be made of any

special editions in the local newspapers, which may provide an opportunity for us to

advertise our product and business name.

Our strategy will involve 4 stages in the initial first year:-

1) Phase I: It will include distribution of pamphlets in newspapers across the primary target

markets i.e. Mumbai, Pune, Nashik, Nagpur, Solapur and Aurangabad. This will be done

for promotions for the first 3 months.

2) Phase II: The distribution of posters and promotional items to medicals shops for the next

couple of month. This will be used until the entire budget is used for this purpose

.

3) Phase III: It will include the 1st part of the advertisement campaign in a popular lifestyle

and medical magazine for a period of 4 months. This is to target the upper middle class

segment and the medical practitioners.

4) Phase IV: This is the final stage where we will promote through newspapers. The strategy

we followed is that we will advertise every week only on Saturdays for a period of 3-4

months. This will give us a better exposure as an advertisement on Sunday is most

expensive and the weekdays; it can be assumed that not many people will pay attention to

our advertisement due to their hectic schedule.

Events:

We intend to attend trade shows and exhibitions to increase awareness of our products and

services. These events will also enable us to interact with potential clients who may decide

to order our products.

FINANCIAL ANALYSIS

2010-11 2011-12 2012-13 2013-14

Sales (units) o 45,405 50,450 56,000

Sales Revenue 0 172,53,900 191,71,000 2,12,80,000

COGS 0 82,93,000 90,81,000 1,00,80,000

Gross Margin 0 8960,000 100,90,000 1,12,00,000

Development Costs -90,00,000 0 0 0

Marketing Costs 0 50,00,000 55,00,000 60,00,000

Administration

Overheads 0 21,65,000 23,81,500 26,20,000

Gross contribution -90,00,000 17,95,000 22,08,500 25,80,000

Interest paid @11% 0 5,00,000 5,00,000 5,00,000

Net Contribution -90,00,000 12,95,000 17,08,000 20,80,000

Tax @ 12% 0 155,400 204,960 249,600

Profit after tax -90,00,000 11,39,600 1503,040 1830.4

Advertising and Marketing Expenses:-

1) Advertising and promotion

Phase I: 9 lakh pamphlets @Rs1 Rs 9, 00,000

Phase II: Posters, events and promotional items (for retailers) Rs 5, 00,000

Phase III: Magazine ad. @Rs100, 000 per ad. Rs 4, 00,000

Phase IV: Newspaper ad. @Rs 100,000 per ad Rs16, 00,000

2) Distribution and warehousing Rs16,00,000

Total Rs.50, 00,000

Assumptions:

1.) Taken a loan of Rs. 1 cr. And an individual investment of Rs. 20 Lac

2.) COGS include Machinery – Rs. 90 Lac for first year, Variable Cost – Rs. 180 per pack,

Rent – Rs. 10,000 per month. Second year consists of only rent and variable cost

3.) Advertisement are distributed as follows:

I Phase: Pamphlets Rs 3, 00,000

II Phase: Posters, events and promotional material worth Rs 5, 00,000

III Phase: Monthly magazine ad, =Rs1, 00,000 per ad

IV Phase: Newspaper ad. = Rs 1, 00,000 per ad

4) Administrative overhead increase at 10% per annum

5) EMI from bank loan is Rs 5, 00,000 per year

BCG Matrix

After reaping the initial success and if we diversify in the near future the BCG matrix

would be as follows:

The areas of diversifying would be:

1) Relive adult walker (support to walk)

2) Relive toilet aids/ commode chairs

3) Relive diabetes/BP kits (for diabetic and BP patients)

4) Relive wheelchairs (for those who can’t get up on their own and need wheelchair

to travel)

Ranking Company Relative Market share Growth rate

Sales 2015

1 Relive toilet aids/ commode chairs 1.35 30.75 17138.00

2 Competitor 12694.81

8 Relive adult walker 0.50 34.64 985.411 Competitor 1970.82

10 Relive diabetes/BP kits 0.35 14.93 422.171 Competitor 1206.20

1 Relive adult diapers 1.15 10.14 2308.022 Competitor 2006.97

12 Relive wheelchairs 0.12 6.48 334.871 Competitor 2790.58

0.000.200.400.600.801.001.201.401.600.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

Relive

Relive diabetes/BP kitsRelive Adult DiapersRelive toilet aids/ commode chairs Relive wheelchairs Relive adult walker

Market Share

Mar

ket G

row

th

COMPETETIVE ANALYSIS

There are currently few local companies competing in our market niche. However upon closer

research it was identified that Indian products constitute approximately 60% of the market,

dominating the market. Hence we intend to market ourselves as a local quality manufacturer of

adult diapers in such a way that with time customers will choose our products over competitors'

on the basis of our lower costs, faster order fulfilment times and high quality. The following

were identified as our main local competitors:

(The competitors information are purely based on assumptions)

Suraksha: Located in Pune, it specializes in the manufacture of baby napkins, bath and hand

towels, diapers, baby diapers with a large share of the western market, mainly due to the less

distance between all major cities; it is an established player on the market and was rated as the

best performer in the sector in 2005. It has had tremendous growth in a short time, with state of

the art machinery currently in place

Suvidha: Located in Nashik, it specializes in the manufacture of baby napkins, towels, face

cloths, Adult diapers and sanitary pads. It has a large warehouse whose logistics/operations are

well organised, coordinated and closely supervised. Prices are extremely competitive .It targets

both retailers and consumers ensuring a large customer base.

Atmay: Located in Solapur, it intends to go into manufacturing of baby napkins in bulk in the

near future. It currently has the capacity to do so and manufactures face cloths and dish towels,

all for the western region of Indian market.

FUTURE SCOPE

The following can be implemented after reaping initial success in our venture:-

Direct Marketing:- We can also provide diapers via direct marketing through our website at a

less cost following a Loyalty program .

Also , if we get successful initial response in the market, we can hire call center services to take

order from customers(if it is possible)(details will be provided in the brochure/pamphlet)

In the case of telemarketing, it will involve our targeting potential customers of our products and

informing them of our existence. We may then arrange for an appointment with the respective

decision-maker/order-maker, with the intention being to encourage them to order our products

(assuming we develop a huge product line in personal care segment)

Diversification:-We hope to diversify towards other markets like baby diapers and sanitary pads.

We also can hope to provide services of collection and recycling of used diapers from various

sources. (1st priority will be our customers and hospitals)

There has been a recent technology in Japan for recycling of used diapers (click the link below

for the article) for making fuel. We assume that if we can have a tie up to export batches of used

diapers to them at a price if at all they go on a full scale commercialization. Maybe a tie up with

the government may be possible. (All these are based on assumptions)

References

1) http://news.cnet.com/8301-17938_105-20004020-1.html

2) Theory: Marketing planning & strategy: Subhash Jain