Developing an Integrated Marketing Mix Plan

Developing an Integrated commercialiseing Mix PlanThe take succuss and succus deglutitions grocery sector has enjoyed steady growth up until the last few eld. However, the grocery has now stalled due to the economic inlet. Juice drinks be less high-ticket(prenominal) than produce juices and this latter segment of the trade has consequently grown whilst the fruit juices segment has declined, a trend that is expected to continue for the next few old age at least. New harvest-time innovation and publicizing expenditure are also in decline but in-store promotions are increasing as ticks disturb for market share. Established suckers are paying more attention to the growing childrens market with specially positioned and targeted products.The Food Standards commission has actively promoted healthier eating and pressurised the drinks assiduity to do the same. However, tough economic times and unemployment are affecting both consumer confidence and the ability of consumer s to finance a healthier eating lifestyle.Even so, on that point is undoubtedly a market gap for a hot put up to exploit. A intelligent juice drink aimed at children, for consumption at eat time, would fuddle little direct competition, in terms of its inciter positioning, and would satisfy the need parents have to monitor their childrens five-a-day intake. Equally, it could also compete effectively in instruct lunch box market segment, which is an identified growth area.A new brand in this market segment would need a strong brand name and a distinctive brand position that resonates with consumer needs and stands out amongst the plethora of well -known brand names, which include Tropi freightera and Innocent smoothies. The new brand go forth also have to spend heavily on promotion during its hurl phase to establish a sustainable market share. The promotional computer program go out need to deploy communications tools much(prenominal) as TV, which can deliver the right a udience in sufficient numbers to achieve this goal in the shortest time possible. Other nominate media, such(prenominal) as online advertising, public relations, and gross gross revenue promotion, will be required in order to support the TV advertising and extend the coverage and frequency of the promotional campaign.The positioning of the new brand is crucial in relation to all aspects of the marketing mix plan, as is the desegregation of both these activities and the key communications messages, all of which will help to ensure, as far as it is possible, the success of the new product launch.The market sector consists of deuce distinct segments, namely fruit juices, which are carbon% pure fruit juice and juice drinks, which contain ingredients other than pure fruit, such as water.The cherish of the market sector in the UK grew in 2010, compared to 2009, with an annual increase of just over 3% to 3.2 billion (Euromonitor, 2011). However, it only recovered to 2008 levels (Minte l, 2008) following a lapse in sales observe to 3.1 billion in 2009 (Mintel, 2010).Whilst both overall leger sales and values have grown steadily in young years, the effect of consumers trading down, together with a reduction in advertising expenditure and new product innovation and development by all brands, the market sector, in terms of product life cycle, appears to be reaching maturity (Mintel, 2010) chat Figure 1 belowFigure 1 Product liveliness Cycle (Source adapted from Kotler, 2001, p. 349)1.2 Sales Trends output Juices Vs Juice DrinksIn 2010, there was a notable shift in consumers buying value-for-money juice drinks rather than subsidy fruit juice products. Volume sales in the fruit juices segment declined whilst the juice drinks segment increased its volume sales by 1% and its value by just over 3% in 2010, compared to 2009 (Euromonitor, 2011).This has resulted in a narrowing of the gap between the volume sales of fruit juices versus juice drinks realize Figur e 4 below. Mintel (2010) expects this trend to continue to at least 2015. delay 1 Volume Sales Trends harvest-time Juices Vs Juice Drinks(Source Mintel, 2010)1.3 The free-enterprise(a) Environment1.3.1 production JuicesThe brand leader and dominant player in the fruit juices market sector is Tropicana with an estimated 30% share followed a long way behind by Princes with just 3%.Tropicana has achieved its success finished maintaining a balance between its premium brand positioning and a pricing strategy that is both let for a premium brand and sufficiently draw ining to consumers. Tropicana also benefits from being the UKs most recognised brand in this market sector (Euromonitor, 2011).Orange corpse by far the most popular flavour in the fruit juices market segment account statement for about 58% of total sales volume in 2010 (Bainbridge, 2011).1.3.2 Juice DrinksThe major brands in this market sector are Oasis, Ribena, Capri Sun and Robinsons, which together account for abou t 50% of all sales. For juice drinks, check to Mintel, blended flavours are the most popular (Bainbridge, 2011). Tropicana has also extended its brand into this sector with its Tropicana Go product for children.1.4 Consumer TargetingAccording to TGI, the fruit juice and juice drink market sector is strongly associated with families with 83%, penetration of those UK ho spendholds with children aged from five to nine. This is believed to be because parents and housewives in particular, are aware of the perceived health benefits of products in this market (Bainbridge, 2011). In addition, children account for one third of the consumption of all juice drinks (Euromonitor, 2011).1.5 Media advertisement ExpenditureThe following collar tables detail media advertising expenditure for fruit juices and juice drinks overall, by main monitored brands, and by main monitored products.DateExpenditure2009/10Index2005/06=centuryAdspend SalesmRatio (%)2005/0628 coke0.92006/07291040.92007/08301071.0 2008/0923820.72009/1018640.6(Note year is from July-June. Main monitored brands only excludes smoothies).Table 2 Total Overall Media advertizing Spend 2005/06-2009/10(Source Nielsen Media Research, 2010)adman2007/082007/082008/092008/092009/102009/10TotalTotal000%000%000%000%Coca-Cola Great Britain4,656166,675294,8532716,18423Britvic Soft Drinks Ltd8,106273,693162,2841314,08320PepsiCo Intl Ltd4,872172,12293,0361710,03114 oceanic Spray Intl Inc4,457152,05391,846108,35512GlaxoSmithKline Plc2,30781,573798964,8697Gerber Foods Intl1,21141,81581,38684,4126Nichols Plc1,10441,08951,33273,5255Rubicon Products Ltd89231,138541122,4413British Sugar Plc6612973463342,2673Sunsweet Growers1581132141127011Others1,09241,707761033,4095Total29,51610022,97110017,79110070,278100(Note year is from July-June.Main monitored brands only excludes smoothies).Table 3 Media Advertising Spend by Advertiser 2007/08-2009/10(Source Nielsen Media Research, 2010)BrandAdvertiser200720072008200820092009TotalTotal0%0%0 %0%Oasis DrinkCoca-Cola2,26082,676112,135117,0719Ocean Spray CranberryOcean Sp.2,23582,604101,75196,5909Tropicana polished PremiumPepsiCo5,129171,13456,2648Tropicana Pure Premium OrangePepsiCo32211,96183,331175,6138Capri-SunCoca-Cola755367432,521133,9505J2O Fruit DrinkBritvic1,6596212,179113,8595Robinsons Fruit ShootBritvic2,7209348174343,8125Vimto Soft DrinksNichols1,19741,30551,12163,6235Welchs Purple GrapeGerber34112,230996653,5375Robinsons Drink goBritvic2,33381,13653,4695OthersOthers10,4163511,000445,3902726,80636Total29,36710025,08910020,13810074,594100(Note Main monitored brands only excludes smoothies).Table 4 Media Advertising Spend by Brand 2007-2009(Source Nielsen Media Research, 2010)1.6 Distribution1.6.1 Off TradeMost off trade sales take place through the large supermarket chains. Tesco sells more fruit juices and juice drinks than any other retail off-trade outlet accounting for around 18% of all sales in 2010 with Asda accounting for just over 11% (Euromonitor, 2 011).1.6.2 On TradeThe key on-trade distribution channels in the UK are fast food and other restaurants, plus pubs, forbid and clubs, where juices are typically used as mixers. However, the adultjuicebrand J2O is positioned as an alternative to alcohol in pubs, bars, and clubs and is increasing its sales year-on-year (Euromonitor, 2011).1.7 termswhole footings vary considerably depending on whether the drink is a fruit juice or a juice drink, and its fruit content if it is a juice drink. In addition, unit price varies according to the products positioning i.e. if it is a premium, supermarket own label standard or budget product. A selection of typical retail prices are shown in the two tables below. emplacementBrandRetail hurtPremiumTropicana Orange Fruit Juice 1L2.18Supermarket Own Label StandardTesco Apple and mango tree Fruit Juice 1L Litre1.60Supermarket Own Label cipherTesco Value Apple Juice 1L0.62Table 5 Fruit Juices Typical Retail Prices(Source mySupermarket.co.uk, 20 11) attitudeBrandRetail PricePremiumPrices Cranberry Juice Drink 1L1.42Supermarket Own Label StandardTesco Exotic Juice Drink 1L0.90Supermarket Own Label BudgetTesco Value Apple Juice Drink 1L0.53Table 6 Juice Drinks Typical Retail Prices(Source mySupermarket.co.uk, 2011)Unit prices in 2010 were reported as being horse barn even though some brand owners passed on cost increases associated with fluctuations in currency exchange rates between the euro and the pound. However, this move was counterbalanced by discounting and promotional offers for private label and leading brand in the retail marketplace (Euromonitor, 2011). Generally, consumers were inclined to trade down tojuice drinks from fruit juices, due to price considerations. Whilst the recession undoubtedly encouraged discounting and sales promotions, it is evident that both own labels and leading manufacturers offered discounts and promotions long before the recession actually started. This practice is forecast to be a perma nent strategy in the market sector in the future as brands jostle to establish and consolidate their hawkish positions in an increasingly price sensitive market (Euromonitor, 2011).1.8 The Macro Environment PESTEL AnalysisOrganisations can examine their external macro-environment by using the PESTEL analysis framework (Gillespie, 2007). A PESTEL analysis for the fruit juices and juice drinks market sector appears belowPoliticalThis refers to any government policy that may cause an intervention in the marketplace.In 2004, the Food Standards Agency (FSA) in the UK stated that it had a mission to convince consumers to adopt healthier food options for a healthier lifestyle. The FSA also required that the food and drinks industry support it in trying to achieve its aims (Food Standards Agency, 2004). The FSA suggested that organisations should include red-blooded eating strategies for their customers as part of their overall corporate social responsibility programmes rather than simpl y as a marketing tactic.In addition, the government has promoted healthier eating through an increased intake of fruit and vegetables with its 5-a-day campaign. This has been successful with 74% of those consumers questioned claiming they were aware of the campaign and well-nigh 60% having taken some action as a direct result of being exposed to the campaign (Food Standards Agency, 2008).EconomicThis includes such factors as spare-time activity rates, taxation changes, economic status and growth prospects, inflation, and exchange rates.Interest rates remain at an all time low with correspondingly low owe servicing costs for the majority of homeowners. However, unemployment, together with the threat of unemployment, is negatively affecting consumer confidence, which, in turn, is causing middle-income consumers to trade down higher priced, premium and luxury products (Warc, 2010). kind andCulturalThis covers social and cultural trends that can affect consumer demand.There is a notic eable trend towards healthier eating habits in the UK. The importance of this to brands owners and marketers was highlighted in the health of Britain Survey conducted in 2008 when Giles Quick from the research company, TNS Worldpanel UK said It is unlikely that we will ever put health before taste, but brands that manage to combine coarse taste with practicality as well as a positive health proposition, are in an ideal position to win full marks from the consumer(Quick, p. 3, 2008) expertThis looks at how new technologies can help defecate new products and new processes.The ubiquitous internet and the growth of mobile electronic communications devices will have an increasing influence over the way in which consumers interact with, and buy, brands, products, and services (Ericssson White Paper, 2011)EnvironmentalIncludes the weather and climate change and how these may affect the marketplace. globular warming and climate change are affecting the UK inasmuch as climatologists expec t a generally warmer climate in the future. This may result in consumers drinking more water and, equally they drink more fruit juices and juice drinks (just-drinks, 2011).LegalThis includes the legal framework within which the organisation and its competitors operate.There are currently no legal issues that may affect the market.2.0 Identification of the Market Opportunity2.1 Rationale for the Market OpportunityAs has been seen from the analysis in better 1.0, the ongoing economic difficulties in the UK have caused consumers in the market sector to trade down from fruit juices to juice drinks. This has been borne out by volume sales figures showing a decrease in fruit juice sales and an increase in juice drink sales over the last three years with the trend forecast to continue to at least 2015 (Euromonitor, 2011). However, fruit juices and juice drinks targeting children have seen their volume sales increase. For example, in 2010, Innocent saw sales of its childrens Wedge Cartons grow and subsequently launched a new product for children, PureFruitSqueezies, designed as a snack to go in childrens school lunchboxes. Feel Good Drinks for Kids and Tropicana Go were also launched to target the school lunchbox market (Euromonitor, 2011).For juice drinks, breakfast time is when 50% of all such drinks are consumed (Euromonitor, 2011). entirely fruit juice and juice drinks, even if they contain no added wampum, contain natural fruit sugar. Consequently, for children, it is especially important that they consume juice drinks at mealtimes, such as at breakfast, as this is less likely to damage their teeth than if they sip at juice drinks during the day (Food Standards Agency, 2011). Equally, parents can monitor their childrens intake of juice drinks at breakfast and ensure that they clean their teeth afterwards before they go to school. In addition, parents are becoming increasingly aware of the need to leave a healthy diet for their children and this message is be ing actively promoted by government through the Food Standards Agency (2004). Research by Euromonitor (2011) has identified a specific market gap for products targeted at children and believes that brands in this marketplace need to strengthen their five-a-day messages.2.2 Defining the Market OpportunityThe gap in the market, therefore, is be asA high fruit content (50%), healthy juice dink for children to consume at breakfast as part of their five-a-day needs.2.3 CompetitionCompetition for such a product will come primarily from those brands that have developed, and successfully marketed, products specifically aimed at children. The identified competitors in this respect areInnocents childrens wedge cartons and PureFruitSqueezies,Feel Good Drinks For KidsTropicana Go3.0 Marketing Mix Plan3.1 Marketing ObjectivesTo generate sales worth 120 million within 12 months of launch.To achieve a 4% share of the overall fruit juice and juice drinks market sector within 12 months of launch.3. 2 Marketing Strategy3.2.1 introduction StrategyAccording to accepted marketing theory, for a new product launch in a matched and price sensitive marketplace, such as for fruit juices and juice drinks, a brand needs to build consumer awareness quickly and achieve rapid market penetration to establish itself successfully (Kotler, 2001, p.355).Consequently, it is proposed to launch the new juice drink product using a rapid penetration strategy, which is one of four identified strategies for a new product launch- see figure 2 belowFigure 2 Marketing Strategies in the Introduction Stage(Source adapted from Kotler, 2001, p.355)The rapid penetration strategy involves launching the new product at a relatively low price, compared to competitor products, with heavyweight promotional support in order to achieve the fastest possible market penetration and to gain the highest possible market share. This is a sensible strategy in a market with a number of established competitors where a new, an d by definition, unknown brand has no consumer awareness. It is also a strategy more likely to succeed where there is price sensitivity in the market, as there is for fruit juices and juice drinks. In terms of cost, then the unit manufacturing cost falls with the volume production scale and with accumulated production experience (Kotler, 2001, p.356).3.2.2 Competitive PositionThere are four basic competitive positions that the new product could adopt as followsMarket LeaderMarket ChallengerMarket FollowerMarket NicherAs this is a new product launch targeted at a segment of the overall market, which, although relatively immature, has some established players, it is proposed that the product is positioned as a Market Challenger. This competitive market positioning is relatively high-risk but also high-gain and helps to build a sustainable competitive usefulness (Kotler and Armstrong, 2010)3.2.3 Analysing CompetitorsThe fruit juices and juice drinks market sector is characterised by i ntense competition between organisations, many of which now operate on a global scale. In view of this, even though the main competitors have been identified, it is crucial that the new brand gains a detailed insight into the nature of these competitors if it is to consolidate its long-term competitive position following its launch (Wilson and Gilligan, 2005, p. 223).According to Kotler and Keller (2006) there are a number of strategic steps that need to be undertaken in order snap competitor actions in the marketplace. See Figure 3 on the next page.Figure 3 Strategic Steps in Analysing Competitor ActionsIn the gaucherie of the proposed new product, with its Market Challenger position, it is proposed that all fruit juice and juice drink brands competing within its market segment are attacked -see 3.2.3 Brand Positioning below. However, the brand needs to constantly monitor and evaluate the activities of its competitors.3.3 Product Strategy3.3.1 Product SpecificationA blended*, hig h fruit-content (50%) juice drink with no added sugar or colouring unattached from the soft drinks section of the supermarket (not chilled).* Actual flavour blend to be determined through research and pre-testing with consumer sample.3.3.2 Brand NameThe proposed brand name is START The product targeted at children will be called START for Kids.This name is intended to help position the brand as a product for consumption at the start of the day i.e. at breakfast. It is also a short and memorable name, which will help the product to stand out in a crowded marketplace and will also help facilitate the establishment of the brand in the consumer consciousness. In addition, the brand name has connotations of a healthy start to the day for kids. The brand name START is also not exclusively for children and lends itself to extensions into other market segments, such as for the adult market.3.3.3 Brand PositioningPositioning a brand has been described as an attempt by a business to influenc e the way in which consumers perceive and behave towards that brand in the marketplace (Perreault and McCarthy, 1999). For example, a brand could position itself to appeal to a particular consumer segment by promoting a particular attribute of the brand that would appeal to that segment (Pechmann and Ratneshwar, 1991). The following two figures illustrate the proposed brand positioning for the new product.High PriceJuice DrinkPure Fruit SqueezieChildrens WedgeFruit Juice/ SmoothiesSTARTFor KidsLow PriceFigure 4 START Brand Positioning Childrens Fruit Juice/Juice DrinksPrice per 100 ml/100 g and Pure Fruit Juice ContentSchool Break TimesJuice DrinkPure Fruit Squeezieand Childrens WedgeFruit Juice/ SmoothieSTARTFor KidsBreakfastFigure 5 START Brand Positioning Childrens Fruit Juice/Juice DrinksPrice and Consumption Time3.3.4 PackagingThe packaging will be a Tetra Classic Aseptic pack in two pack sizes 100 ml and 200 ml (Tetra Pak Website, 2010). This is to enable it to be used prim arily as a breakfast drink in (200 ml size) and secondarily as a snack drink (in 100 ml size) at school break times. The tetra pack is easy to drink from and is also easy to pour into a cup or glass. The pack is also stable on the kitchen counter and on the school desk. See Appendix I.For retail distribution, the individual packs will be interchange in rectangular multi-packs of 10 for the 100 ml and 5 for the 200 ml. The rectangular packaging will assist ease of display and stacking in the retail environment3.4 Distribution StrategyIn line with the rapid market-penetration strategy, the product will be sold though all supermarket chains and convenience stores in the UK with a heavy intensity. In view of the target audience, it will not be sold through the on-trade.The product will only be available for retail sale in multi-packs at the prices shown in Table7 on the next page.3.5 Pricing StrategyUnit prices in the market segment are currently stable and subject to discounting on p romotion (Euromonitor, 2011). The rapid market penetration strategy determines that the pricing strategy for START will be highly competitive and challenging to the market leader and to other brands in the market segment.Brand/ProductRetail Pack SizePrice per 100 ml/ 100 gLowest Retail price per packSTART For Kids5 x 200 ml0.202.00START For Kids10 x 100 ml0.222.22Tropicana Go4 x 200 ml0.252.00*Feel Good Drinks For Kids1 x 400 ml0.321.27*Innocent Childrens Wedge cartons4 x 180 ml0.412.92*Innocent PureFruitSqueezies6 x 40g0.832.00*Table 7 Retail prices for START and Competitor Products(*Source mysupermarket.co.uk, 2011)3.6 Consumer Segmentation and TargetingKotler, (2001, p.286) suggests that consumer markets can generally be segmented in three ways as shown below for the new productSocio-demographics Primary Housewives with school age children from 4 to 11, young-begetting(prenominal) and female. Secondary The children themselves.Psychographics families with a healthy lifestyle or intending to adopt a healthy lifestyle.Behavioural factors Parents of children who have a positive attitude to the benefits of a healthy diet.3.7 Marketing Communications Strategy3.7.1 Marketing Communications BudgetThe average advertising spend to sales ratio over the last five years has been 0.82%. In order to achieve the marketing objectives stated and implement the rapid market penetration strategy it is proposed that the budget for the first year for START For Kids be set at double this ratio i.e. 1.6%. This will result in an advertising budget of 1.92 million. A summary of the overall marketing communications budget by activity appears in appendix II3.7.2 Marketing Communications ToolsAccording to Kotler (2001), there are five main categories of marketing communications tools-AdvertisingSales PromotionPublic RelationsPersonal SellingDirect marketing3.7.3 Marketing Communications Tools Characteristics/ObjectivesAccording to Fills 4Cs model (2002), the five main communication s tools, are characterised by four principal dimensionsCommunications ImpactCredibilityCostsControlSee Figure 6 on the next page, which shows how these dimensions have to the various component of the communications mix.Figure 6 Fills 4Cs ModelAs has already been established, START needs to gain rapid penetration through the use of high impact promotional activity that delivers a large audience within the identified consumer segment. In view of the target audience definition, and the need to create high levels of product acceptance, it is proposed that the consumer promotional activity includes a mix of tools including advertising, sales promotion and public relations.3.7.4 Integrated Marketing Communications (IMC)The concept of IMC was acclaimed by Moriarty (1994) as being one of the most significant developments in the marketing communications business in the 1990s. Kotler first discussed IMC back in 1997 but it was not until 2003 that defined the concept thusIntegrated marketing communication is a concept according to which the company integrates and coordinates its communication channels to send a message clearly, systematically and convincingly about the organization and its product (Kotler, P, 2003, p. 672).Fills promotional planning framework (2006, pp.174-176) summarises all the aspects of the marketing communications planning process see Figure 7 below.Fill categorises the tasks achieved by communications activity into three areas namely, Push, curl up, and Profile, as follows-Push The activity is pushed from the product provider to the supply chain intermediaries to help develop relationships.Pull The activity is from the product provider to the end consumer to generate a call to action either a purchase or an enquiry.Profile The product provider implements a mix of communications strategies to build brand reputation with all of its target audiences.Figure 7 Fills Promotional Planning Framework(Source Fill, 2006, pp.174-176)If a formally struc tured approach to marketing communications planning, such as that detailed above, is not followed there is a risk that the goals and strategy of the marketing communications plan will not link to the high-level corporate goals, or to the marketing goals of t