Marketing plan for developing bakery products for kids in supermarkets

1 COMMITMENTS The information, knowledge in this thesis of “Marketing plan to develop bakery products for kids in supermarkets” is my own work with academic learning from the course MBMM, from tutor’s advices as well as from my own working experience All data in this thesis are true and I will use it for study only, it can be used for Puratos business but not for any other commercial purposes Quang Minh Truc ACKNOWLEDGEMENT It is my pleasure to express my gratitude to all those who have helped me make this thesis possible Without them, I could not have completed this project First of all, I would like to thank all professors, doctors of Hochiminh Open University and professors from Solvay Business School for the systematized knowledge and new knowledge during the course MBMM which I could not have during professional working time in last 10 years I would like especially thank to Dr.Nguyen Minh Ha, my tutor for the final thesis, without any day learning in his class, but I received abundant guidance, information and particularly his enthusiasm in tutoring Without his tutoring, my thesis will not be completed I also thank to Ms.Janet Leong, my General Manager of Puratos Vietnam, who helped to consult me for practical advices from her own experience and from company’s aspects I highly appreciate my classmates, group mates for the sharing, encouraging, challenging me during the course and in the period doing final thesis Lastly, and most importantly, I feel a deep sense of gratitude for my dearest wife, family who gave me both financial and moral supports that I needed during year studying, and to my little baby girl is the very last thanks for her bringing happiness to my life during studying time TUTOR’S COMMENTS CANDIDATE: Quang Minh Truc PROJECT TITLE: MARKETING BAKERY PLAN PRODUCTS FOR FOR DEVELOPING KIDS IN SUPERMARKETS COMMENTS: TABLE OF CONTENTS COMMITMENTS ACKNOWLEDGEMENT TUTOR’S COMMENTS TABLE OF CONTENTS LIST OF FIGURES LIST OF TABLES EXECUTIVE SUMMARY CHAPTER 1: INTRODUCTION 10 1.1 Problem statement 10 1.2 Study objectives 10 1.3 Scope and scale of project 11 1.4 Research methodology 11 1.5 Significance of this study 12 1.6 The study structure 12 CHAPTER 2: PURATOS INTRODUCTION 13 2.1 Vision, Mission and Values 13 2.2 Puratos’ marketing activities and conceptual framework 15 CHAPTER 3: LITERATURE REVIEW 16 3.1 Marketing plan 16 3.2 Market analysis 17 3.3 Marketing objectives, targeting and positioning 19 3.4 Marketing mix 4P’s to 4C’s 20 3.5 Resource and financial plans 22 3.6 Marketing Implementation 23 CHAPTER 4: RESEARCH METHODOLOGY 24 4.1 Research methodology 24 4.2 Questionnaire development 25 4.3 Training and pre-test 25 4.4 Free trial products and Interviews 26 4.5 Data collection and analysis 27 CHAPTER 5: MARKETING PLAN FOR DEVELOPING BAKERY PRODUCTS FOR KIDS IN SUPERMARKETS 28 5.1 Company mission 28 5.2 Market analysis 30 5.3 Company’s current marketing status: 35 5.4 Marketing plan for period 2012 - 2013 39 5.5 Marketing activities for marketing plan 41 5.6 Resource and budget for marketing plan 50 5.7 Implementation plan 54 5.8 Evaluations 55 CHAPTER 6: CONCLUSIONS AND RECOMMENDATIONS 57 REFERENCES 59 APPENDIX 61 LIST OF FIGURES Figure 2-1: Puratos Group – key figures 14 Figure 2-2: Evolution of the annual turnover (in Million €) .14 Figure 5-1: Puratos Vietnam past years’ growth 29 Figure 5-2: Puratos Vietnam sales forecast, growth forecast 29 Figure 5-3: Age and sex distribution for the year 2010 31 Figure 5-4: Vietnam GDP annual % growth .31 Figure 5-5: Forecast foods consumption in Vietnam 2004-2014 .32 Figure 5-8: Customer’s acceptance price to buy bakery for their kids .45 LIST OF TABLES Table 3-1: Marketing mix from Ps to Cs as Lauterbon’s principle 20 Table 5-1: SWOT analysis – Puratos Vietnam 33 Table 5-2: Sales forecast, marketing budget forecast .36 Table 5-3: Marketing activities and budget plan 37 Table 5-4: Summary project’s objectives 40 Table 5-5: Project’s budget allocation (USD) 51 Table 5-6: Project implementation plan 54 EXECUTIVE SUMMARY Regarding the market situation, company’s strategies and marketing budget as well as our position in Vietnam market, this marketing plan aims to provide a thorough understanding about current bakery products in supermarket and form a base for new development bakery products for kids, in order to achieve marketing objectives and gaining competitive advantage for Puratos, fulfill company mission of double sales of Puratos group in the period year 2010 to 2018 and particular target for Puratos Vietnam with 35% growth each year in supermarket channel The is ongoing co-operative project between Puratos as ingredient supplier and Big C casino as retailer in Vietnam, and it is planned to be completed for 12 months from April 2012, starting from concepts, ideas development to fully implementation in all Big C supermarkets nationwide by April 2013 Free trial products in the research by quantitative nature and data analysis are considered main important activities of project when we applied in field survey for 900 samples in Big C supermarkets in Hochiminh city in the South and Hanoi city in the North to represent for nationwide Vietnam to find out buying behaviors, products preference, important influencing factors on bakery products from kids’ perspectives to form a base of understanding for future products development for our target customer: kids Budget for the project is fairly shared for both sides, in which Puratos is responsible for products developments by technical supports, products support during the survey and soft launching phases which are extracted from marketing budget and Big C own budget for their consumer promotion as well as communication activities From the ideas of this project we have very positive feedbacks from customer about our capability in consumer insight understanding, technical supports and ability to help them explore new sales opportunity We are now on progress tracking sales performance, review and develop more new products and improvement packing as well as production cost to improve profit before official launching in April 2013 10 CHAPTER 1: INTRODUCTION The first chapter gives overall information about the study: reasons we need to do, for what purposes, in certain extent of business status, the ways we and significance of the study as well as how the thesis is structured 1.1 Problem statement In the context of Vietnam economic is developing very well, bakery as one of big foods business is proving its aggressive growth in recent years, especially in supermarket channel, which make them become one of key customers in bakery ingredient business Puratos, a business to business ingredient supplier, wants to take foothold in this important strategic channel by doing partnership marketing with key customers, aiming to gain long term relationship, and gaining sales to fulfill company business mission and marketing vision: Reliable partner in Business through project Development bakery products for kids in supermarkets In the context of market competition is tougher with many new entering competitors, company budget is higher, only by developing new ideas, concepts for customers we can achieve our business purpose to secure constant sales growth 20% a year 1.2 Study objectives The first objective of the study is to build a marketing plan for developing bakery products for kids in supermarket based on market survey results From the marketing plan, we have better understanding about budget to spend versus marketing budget, as well as expected business results for company strategic decision making Another important objective of this project is to make the base form for later studies for business development The project was made for Puratos Vietnam supplier and Big C casino as big retailer in Vietnam which want to innovate new business opportunities in bakery products The two companies need to develop a new range of bakery and patisserie 52 In the preparation steps, mainly we spend for the research to end consumers Spending for ingredients: which takes to 25% of total budget at Puratos it was cost of goods as we sponsored our own products (cake mix, fruit fillings); while Big C use their current using ingredients for the baking products which Puratos don’t supply (flour, eggs, cooking oil, savory…) Spending for packaging and stationary: special paper cups, mold for baking small size cakes; plastic bags for covering, wrapping the products; photocopies for the questionnaires, color print the signage to advertise for the surveys Miscellaneous expense was for the small stuff served for the survey consists of plastic plates, tissue, food & beverage for the employees in the survey Transportation expense was for the flying to Hanoi city in North when almost key person in charge of both Puratos and Big C base in Hochiminh office This is biggest expense we spent for but it shows the returns when we can find the feedbacks from North and South to make sure the products to be launched can be fit for all stores which locate in different geography and have different buying culture, behavior After the successful research with data analysis and recommendations, there was some more spending for the launching for Big C, this is about communication, promotional tools during the launching, and obviously Big C is the one who bears this cost The design and decoration: almost used for display shelves production cost with the packaging design, logo, display booth, standees… designed free of charge by internal designers of Big C Because it is just the soft launching in store at Big C head office with the expense for booth is million VND and it’s supposed to be multipled when they expand to other outlets 53 Promotional gifts: different from normal consumer goods, the initiative from Big C is very kids focusing: buy packs of cupcakes get colorful spin wheel which is really attractive small customers They also had good arrangement where there is the regular air flow that makes spin wheels always in active moving status In the meantime, they also price discount for specific items, rotation week by week With the budget million VND (100 USD), they can utilize around 700 pcs of spin wheels as promotional gifts for weeks to month during the launching period We spare budget of 200USD for the product sponsor, which is used for new item introduction to bakery for kids finished products, join event with retailers 54 5.7 Implementation plan The whole plan was proposed to proceed in one year, starting from the initial meeting in March.12 to full launching in all existing supermarket of Big C in middle year 2013 which included some main parts of preparations – research – launching and they are detailed in table 5-6: Table 5-6:7Project implementation plan MONTH PROPOSAL DATE 15 MARCH.12 25 DISCUSSION MAY.12 FINALIZATION 20 31-3 OFFICIAL LAUNCHING Presentaion of Survey & Proposal by Puratos Product development at Puratos Innovation center Finalization of products, target market, shopper research objecttives, methodology by Puratos and BigC Implementation of shopper survey with target group Alignment with customer on concepts, resource, taskes, expense allocation Agreement on research methodology Smooth execution at store level Insights findings from the research OCT DEC.12 Tracking sales performance DEC MAR.13 New recipes introduction To see real sales to have suitable adjustment APRIL.13 Applied to all customers' stores in nationwide 6-10 JUN.12 EVALUATIONS 1st discussion between Puratos and BigC for idea of KIDS' CORNER in VN Follow up discussion between Puratos and BigC OUTCOMES Compilation, conclusion on shopper survey Implementation on shortlisted product range, recipe costing, training for bakers, development of marketing tools, promotions Continued discussion, implementation Launching at 1-2 stores; Targeted KIDS' Corner launching & products ready on the shelf IMPLEMENTATION SOFT LAUNCHING DESCRIPTION 14-14 Jul JUL.12 15 - 24 OCT.12 1-8 Source: company’s marketing plan Proper proposal with recommended ingredient from Puratos To track total sales increasing, results, return on investment from this project 55 5.8 Evaluations This is first big Partnership project we with our large customer, so we can find out some obstacles and also certain advantage as we all team’s ideas and customer’s feedbacks Some obstacles we faced with: Planning and preparations: this very important step was struggled from the time before project kick off, especially about budget planning We both mentioned this project in several meeting long time ago, but to define when to start it is not easy when the resource changing from our side, customer changed their priorities in their business plan, not well communication about the time they prefer to start As the result, we did not reserve budget for this project in year 2012, the argument for who to bear what budget was big discussion during the initial meetings We have to cut budget from other activities and shift them to this project, leverage internal resource with very limited spending is another effort from Puratos Vietnam This is also similar to Big C, our partner in this project, understanding we cannot survive all the cost for on behalf of them, they had no way to same like us: balancing from some else part in their activities, influence their related department for support Products development: one of the most important finding from research is the packaging, which has big influence to buying decision of customers, but we have limited quantity of paper cups, which were supposed to reserve for demonstrations, now we bring to support to Big C at launching time, if they cannot find the solutions of substitution it will be high risk of lost sales from this new segment 56 Advantages of the project: From analysis project, it is quite clear to recognize the advantages of project as below: o To have long term partnership development with key customers, a foundation for long term business cooperation o We can show to customers our real capability in innovations o We are the very first supplier in bakery products who can help customers to create new business opportunities o Retailer is becoming more professional in widening their product portfolios o Bakery market is more clearly segmented and consumers have more choice o The target customers are young kids have chance to experience new specific products for them, parents have better selection to take care their children 57 CHAPTER 6: CONCLUSIONS AND RECOMMENDATIONS Innovations and partnership development is always the top prioritized topics for Puratos, by detailed analysis in chapter 5, we can see the feasibility of project is very high if compared with investment expense we should spend for, this is true for both Puratos as ingredient supplier and Big C as retailers Conclusions: different from normal process when they launched bakery products for adults, in which they just prepare themselves with new recipes, design development, costing calculation and sales, this project with careful research and we could collect lots of valuable information from consumers side, mapping with market hypothesis, we give out the most relevant list of products that really satisfy consumers’ needs and want By doing this, we proved to Big C and other customers our ability to get understanding consumer’s insights, not only in this project of bakery for kids in supermarket but also in normal or specific tailor made products for customers when they request Investment budget for project is not high and returns from this is very optimistic because of the suitable pricing, products that matches with current Big C business strategy: low price for every family Recommendations: Research data need to be classified for North and South and we can find some better understandings about shopping behavior, preference from different geography For sales perspective, the closely tracking and regular visiting customers at individual store levels to get real feedbacks from bakery category manager, direct staffs of bakery for kids segment is really necessary These feedbacks should be verified and consolidated into actions plans 58 As a base of partnership development, marketing team of Puratos needs to multiple the success and initiatives of other new projects, not only for supermarket as cross merchandising bakery products, moving shelves for bakery merchandising, hi end bakery and patisserie products, healthy bakery range and also for other lines of business as artisan bakery chain or 3rd party production suppliers development Because Puratos is long term vision ingredient supplier, because we need to build the image reliable partner in customers’ business by selling solution, innovations and development not just single product 59 REFERENCES American Marketing Association (2004): AMA Adopts New Definition of Marketing Bennett W., (1991), “Young shoppers hold sway over parents’ choices” Burns, A & Bush, R (2000) Marketing research 3rd edition New Jersey: Prentice Hall Ford et al 1998 Frank Bingham, Roger Gomes, Patricia Knowles (2005), Business Marketing P.2005 Hakansson, Harrison, & Waluszewski (2004) Jobber & Lancaster (2009) Jobber, D & Lancaster, G 2009 Selling and sales management 8th edition Harlow: Pearson Education Kotler, P 2003 Marketing management 11th edition New Jersey: Pearson Educa-tion 10 Kotler, P Bowen, J & Makens J 1999 Marketing for hospitality and tourism 2nd edition New Jersey: Prentice Hall 11 Lauterborn, B (1990) ‘New marketing litany: four P's Passe: C-Words take over’, Advertising Age, Vol 61, No 41, pp 26 12 McDonald (2007) and Bowie & Buttle (2004) 13 Philip Kotler, Gary Armstrong Principles of Marketing Edition (21 May 2008) Financial Times/ Prentice Hall; 14 Philip Kotler Principles of Marketing 12th Edition 2008 15 Smith, B & Raspin (2008) Creating a market insight: how firms create value from market understanding Chichester: John Wiley & Sons 16 The New Marketing Paradigm: Integrated Marketing Communications (NTC Business Books, 1997) 60 17 Walker, Mullins, Boyd and Larreche (2006) Marketing Strategy (5th edition, 2006) 18 Wood, M (2004) Marketing planning principles into practice Harlow: Pearson Edu-cation 19 Wright, L & Crimp, M (2000) The marketing research process 5th edition Harlow: Pearson Education 20 http://data.worldbank.org/country/vietnam 21 http://vnexpress.net/gl/kinh-doanh/2011/10/khach-than-phien-sieu-thi-thieukhu-giu-tre/ 22 http://www.marketingpower.com/content21257.php 23 http://www.puratos.com/en/ 24 http://www.tradingconomics.com/vietnam/population-imf-data.html) 25 http://www.vietnamonline.com/shopping/supermarkets-and-retailers.html 26 http://www.imf.org/external/pubs/ft/weo/2010/02/index.htm 61 APPENDIX Questionnaire for kids - Questionnaire for kids – Questionnaire for parents – Questionnaire for parents – Data analysis results – products preference 62 APPENDIX 1: Survey questionnaire for kids - BIGC KIDS CORNER - KIDS Questionnaire for Kids What you prefer to eat (show picture card): (Objectives: to find out the consumption time of different assortments) Tick only answer in each row For breakfast In school For snack Mini Cakes Mini Muffins Mini Donuts Mini Sweet Buns Mini savory Buns Mini Croissant & Danish Mini Pizza Mini bread Cookies What have you chosen today? (Choose one from each category) (Objectives: to find out kid’s preference of specific assortments) Rainbow mini Swiss roll Tick the chosen items MINI CAKES MINI BUNS Vani cake with Blueberry bun Blueberry PUFF/ PASTRY Double cheese Raisin mini Swiss roll Vani cake with strawberry Custard cream bun Chicken sausage + chicken floss Strawberry mini Swiss roll Vani cake with crumble Lemon bun Ham & Cheese Choco mini Swiss roll Choco cake crumble Choco bun Mini pizza Assorted mini cup cakes Choco cake walnut Strawberry bun Mini croissant Choco cake choco chips Mini Danish Choux Pastry COOKIES BREAD Mini choco bread Dark choco cookies Wholemeal cup bread Vanilla cookies MINI DONUTS Mini donuts Mini Muffins Marble cookies Why did you choose this? (Objectives: to find out the attraction points of the products) Tick only answer in each column Appearance/Look Taste/Flavor Color Shape Price Others (pls specify) Item Item Item Item MINI MUFFINS Item 63 APPENDIX 2: Survey questionnaire for kids - Which item you prefer the most and the least? Item Item Item Item Item Rate each item from 1-5 NOTES: 5: The most preferred 4: Preferred 3: Average 2: Less Preferred 1: Not preferred at all What other bakery products you like but cannot be found here? (Objectives: to find out other possible opportunity) Please specify: Which is your favorite? (Objectives: to find out the kid’s preference of fillings and toppings) Tick only answer in each column SWEET FLAVORS SWEET FILLINGS SAVORY FILLINGS COLOR FOR TOPPING Chocolate Orange Tuna White Strawberry Custard cream Ham & Cheese Pink Vanilla Strawberry Pork Sausage Chocolate Lemon Sugar Raisin Minced beef Green Melon Lemon Pork Floss Yellow Orange Chocolate Others Others Others Others When you are shopping with your parents, can you choose what you like to eat? (Objectives: to find out the decision-maker) YES [ ] NO [ ] Do you think these are healthy food for you? (Objectives: to find out what the kids think are healthy for them) Please tick only answer in each column Yes No Mini Cakes Cookies Mini Muffins Mini Donuts Mini Buns Mini Pizza Mini Croissant & Danish 64 APPENDIX 3: Survey questionnaire for parents - BIGC KIDS CORNER - PARENTS Questionnaire for Parents What you prefer your child/children to eat: (show picture card): (Objectives: to find out the consumption time of different assortments) Tick only answer in each row For breakfast In school For snack Mini Cakes Mini Muffins Mini Donuts Mini Sweet Buns Mini savory Buns Mini Croissant & Danish Mini Pizza Mini bread Cookies What have you chosen for your child/children today? (Choose one from each category) (Objectives: to find out kid’s preference of specific assortments) Rainbow mini Swiss roll Tick the chosen items MINI CAKES MINI BUNS Vani cake with Blueberry bun Blueberry PUFF/ PASTRY Double cheese Raisin mini Swiss roll Vani cake with strawberry Custard cream bun Pork sausage + pork floss Strawberry mini Swiss roll Vani cake with crumble Lemon bun Ham & Cheese Choco mini Swiss roll Choco cake crumble Choco bun Mini pizza Assorted mini cup cakes Choco cake walnut Strawberry bun Mini croissant Choco cake choco chips Mini Danish Choux Pastry COOKIES BREAD Mini choco bread Dark choco cookies Wholemeal cup bread Vanilla cookies MINI DONUTS Mini donuts Marble cookies Why did you choose this? (Objectives: to find out the attraction points of the products) Tick only answer in each column Appearance/Look Taste/Flavor Color Shape Price Others (pls specify) Item Item Item Item MINI MUFFINS Mini Muffins Item 65 APPENDIX 4: Survey questionnaire for parents - Which item you prefer the most and the least? Item Item Item Item Item Rate each item from 1-5 NOTES: 5: The most preferred 4: Preferred 3: Average 2: Less Preferred 1: Not preferred at all (it thich nhat) What other bakery products that your child/children like but cannot be found here? (Objectives: to find out other possible opportunity) Please specify: Which is/are your child/children’s favorites? (Objectives: to find out the kid’s preference of fillings and toppings) Tick only answer in each column SWEET FLAVORS SWEET FILLINGS SAVORY FILLINGS COLOR FOR TOPPING Chocolate Orange Tuna White Strawberry Custard cream Ham & Cheese Pink Vanilla Strawberry Pork Sausage Chocolate Lemon Sugar Raisin Minced beef Green Melon Lemon Pork Floss Yellow Orange Chocolate Others Others Others Others When you are shopping with your kids, you allow them to choose what they like to eat? (Objectives: to find out the decision-maker) YES [ ] NO [ ] Do you think these are healthy for your child/children? (Objectives: to find out what the kids think are healthy for them) Please tick only answer in each column Mini Cakes Cookies Mini Muffins Mini Donuts Mini Buns Yes No What is your opinion on the choices made by your child/children today? (show the parents all the chosen products of the kids) Tick only answer in each column Healthy Reasonably Priced Suitable for kids Yes No 10 In your opinion, is there anything else that can be improved at the BigC Kid’s Corner products? Yes (Please specify) No 11 In your opinion, is the BigC bakery products (Objectives: to find out what they think about the current price of BigC bakery products) Value for Money Tick answer only Averagely priced Too expensive Mini Pizza Mini Croissant & Danish 66 APPENDIX 5: data analysis result - product preference ... preferred selection of products assortment for launching 28 CHAPTER 5: MARKETING PLAN FOR DEVELOPING BAKERY PRODUCTS FOR KIDS IN SUPERMARKETS This is main chapter in thesis with combination of literature... marketing plan for developing bakery products for kids in supermarket based on market survey results From the marketing plan, we have better understanding about budget to spend versus marketing. .. as framework for marketing plan of project in latter chapter 3.1 Marketing plan The American Marketing Association (AMA-2007) defines marketing as: The process of planning and executing the conception,