Discuss about the Segmentation of Consumer Preference For Food Safety.
The main aim of this report is to make a marketing plan for exploring and flourishing the business in Malaysia. Kombucha product has been taken in the task. Kombucha is a conventional fermented tea based beverage that provides ample of benefits to the customers. The well known flavor of Kombucha are herbs, berries, citrus, flowers, apple and others (Malbaša Radomir et al, 2011). The company sells its products in various countries such as North America, Europe, Africa, Latin America and Asia pacific. Furthermore, the paper also explains the marketing mix and STPD strategy that are used by the firm while imitating the business in Malaysia. Modes of entry and environmental analysis have also been discussed in the task. More detail of the task has been detailed below.
Remedy Kombucha is a traditional health drink products. It has been found that Remedy Kombucha Company was incorporated in 2012 in Melbourne (Ebersole et al, 2017). Remedy Kombucha is the global market leader in the Australia. The Kombucha is an organic acid that are good for the health and wellbeing (S. E. Harris, 2004). The company is produces more than 150,000 bottles a week to sell at around 4,000 sites across Australia.
The marketing objectives of the company have been detailed below.
It has been noted that Malaysia is known for its location at crossroads of trade between the West and East. The country is one of the significant economies in the world and it became one of the biggest exporters of electronic parts and other components (Anon, 2017). It is stated that Malaysia is a multicultural community and the language spoken by the people is Malay that is language spoken across the country (Businesswest, 2018The country is the second biggest trading partner in ASEAN. Malaysia is strategically situated in the heart of Southeast Asia and it offers cost benefits and competitive advantages for the investors (Anon, 2008). High growth economy can provide long term advantages to the company while implementing the business activities in Malaysia (Gentempo and Patrick, Jr, 2009). There are various procedures involved while establishing the new business in the country which should be taken care by the firm. The market of the country has been a meeting place for a diverse range of religions and external cultures. The market of the country is generally open to explore and flourish in new business. All the entry modes are permitted to enter in the country. The market of the country is the best to know and analyze the key players of the market.. Marketing research and survey is essential to explore the business activities in Malaysia. It will help to reduce the key challenges and risks of the market. Furthermore, it also helps in gaining competitive benefits in such country(Czinkota and Ronkainen, 2013). The pestle analysis for Remedy Kombucha has been detailed below.
Political factor: UMNO is the most political party in the country therefore it can affect the growth of the Remedy kombucha company in Malaysia. The other part is Pakatan. Along with this, various rules, regulations and norms could also have direct impact on the performance and productivity of the firm. The political condition of the country is unique and stable that can help the company to increase the sale and revenue of the product in such country (Tietenberg and Lewis, 2016).
Economic factor: It has been found that Malaysia is a third richest country in its region. The GDP per person is approx $11000 in the year 2014. The economic factors such as employment rate, interest rate, and exchange rate could also affect the sustainability of the firm in the Malaysia. It is analyzed that labor force is very expensive in the country as compared to other countries. Thus, the labor force can affect the profitability of Remedy Kombucha company in such country (Anon, 2011).
Social factor: The social issues such as unemployment, poverty, exploitation of the employees do not exist in the country. There is no discrimination among the people in the Malaysia. The other social factors include culture, values, beliefs and age of the people. All people are considered equal in the country hence there is no partiality in the country on the basis of religious and sex. These factors can help the company to grow its business in Malaysian country.
Technological factors: It has been found that advanced technology and resources are available in the country. The people of the country are well skilled and intelligent therefore, the company can gain ample of advantages while implementing the business functions in such country.
Environmental factor: The environment of Malaysia is highly impacted by the pollution and deforestation. The country has been blessed by diverse range of fauna and flora. The pollution and deforestation could have many adverse effects on the environment therefore it can also affect the sustainability of Remedy Kombucha (Naidu et al., 2018).
Legal factor: It analyzed that Malaysian law and rules have been affected by the Great Britain. The Malaysian rules, legislations and law are based on the Indian and Australian law. All these factors could also impact on the outcomes of the firm (Zawawi & Abdul Ghani Azmi, 2014).
There are ample of competitors that affect the success and progress of the firm. The main competitors include GT’s Kombucha, Bucha, Healthy crush, Kevita, PepSico, and honest. These competitors may influence revenue and profitability of the company in the Malaysia. It is has been noted that Kombucha market is the growing and leading market in the functional beverage category (Fleisher and Bensoussan, 2015). That is why the firm needs to analyze and identify the needs, demands and requirements of the customers in the international market. Various analysis is done by the company to analyze the position and products of the competitors in the global market (Fleisher and Bensoussan, 2015). One of the significant analysis that done by the company is porter five forces analysis. The porter five forces analysis for Remedy Kombucha have been detailed below (Winston et al, 2013). Remedy Kombucha has a revenue of $1million and 87 employees. Along with this, the company has received a total of $2million in funding.
|
Name of the companies |
Market share |
|
Bucha |
22% (122 million) |
|
Healthy crush |
28% (738 million) |
|
Kevita |
6% ($24 million) |
|
PepSico |
22% (AUD $ 432.44 Million) |
Bargaining power of suppliers: It is one of the significant and effective forces that have direct impact on the sustainability and outcomes of the company in Malaysia. It has been stated that suppliers play a less role in the marketplace because the organization direct sell the products to the customers in the country (E. Dobbs, 2014). It is stated that bargaining power in the hands of the customers is low in Malaysia market. Along with this, the company uses ample of channels to distribute the products in such market (Grant, 2016).
Bargaining power of suppliers: It is noted that bargaining power in the hands of the buyer is high that is because the consumers demands high Kombucha products in Malaysia. This product is important for all the customers in the marketplace (Narayanan & Fahey, 2005). Rising health issues, and changing lifestyle are some of the components driving the market for Kombucha products. It is analyzed that Kombucha product is important for all the customers (Wong, Soh and Le Chong, 2016).
Intensity of existing rivalry: After the various research, it has been studied that existing rivalries in the same industry could also affect the productivity of the firm (Porter, 2008). Furthermore, it is revealed that existing rivalries are low in such market because customers are having fewer demands for this product in the Malaysia. There are few competitors existed in the international market (Rothaermel, 2015).
Threats of substitutes: It is analyzed that threats of substitutes are lesser due to few competitors available in the marketplace. Due to lower competitors, the firm has been able to differentiate its products from the rivalries. It also helps the company to beat the competitors in such market (Anon, 2012).
Threats of new competitors: It is stated that customers are loyal to the existing brands therefore, competition do not affect the choices and tastes of the consumers. Along with this, strong and unique distribution network is required to gain the long term rivalries benefits (Dobbs, 2012).
Marker readiness research may be defined as a process by which a company or firm ensures that their product is ready to be introduced in the global market (Der Wiel et al, 2014). It helps to increase and boost the productivity and efficiency of the company and employees as well (Salleh and Emelifeonwu, 2017). If the Remedy Kombucha decides in marketing internationally then market survey and research is done by the company. Marker readiness helps the firm to analyze and identify the key challenges and obstacles of the organization. This is why the firm has been able to meet its long term expectations and targets. By using market readiness, the organization can identify the opportunities and threats of the market and it also helps in identifying the changing trends of the market (Abolfazli et al, 2015). It is stated that market readiness process involves interviewing potential users to see if the product and service solves a specific user needs, wants or whether the product will help users become more effective and unique at the task (olbina, 2015). This process will also help Remedy Kombucha to avoid and eliminate the risk and hurdles in the Malaysia (Ingaldi Manuela & Šk?rková Katarína Lestyánszka, 2014). Timely and systematic preparation is done by the firm for an initial public offering in the success of the transaction that means that the company is offering the products at reasonable prices (Non, 2015). No company can implement its business activities in foreign market without using market readiness (Reio Jr and Whitehead, 2014). The company conducts SWOT analysis to analyze the strengths and weaknesses of the firm that has been detailed below.
|
Strengths |
Weaknesses |
|
· The company maintains strong management and uses unique strategies. · Cost advantages and economies of scale. · Innovative culture and offers unique products. |
· Weak supply chain and lack of scale. · Intense competition in beverage industry. · Weak and poor brand. |
|
Opportunities |
Threats |
|
· Fragmented market · The company can offers new products to the customers. · Emerging markets. |
· High and immense competition is one of the biggest threats for the firm. · Changes in tastes and preferences also affect the success of the firm. |
There are plenty of modes that can be used by the company to implement the market in Malaysia. The modes of entry include exporting, joint venture, outsourcing, franchising, foreign direct investment, licensing, strategic alliance and merger and acquisition (Veronica Baena, 2012). The entry modes helps Kombucha company to eliminate the threats of the market. Furthermore, the firm can use advanced and unique technology with the help of entry modes (Guyet al, 2012). Along with this, it helps in providing skilled and experienced employees and further entry modes also provide support to reduce the cost of the company. One of the significant entry modes that used by the company is strategic alliance. It is a voluntary agreement between two organizations to use their resources to attain the common desired goals and objectives while remaining independent entities. It is mostly used by Remedy Kombucha to explore the production capacity and maximize the market share for a product (Usuf Zekiri, 2016). Alliances help in developing and improving the innovative technologies and utilizing brand image and market knowledge of both the companies. The company can also use this entry mode because it reduces the cost of the company and further, it maximizes the outcomes in the international market (Baena, 2013).
The STPD strategy is initiated by the company to stand out against the competitors. The STPD strategy of Remedy Kombucha has been detailed below.
Segmentation: It is the process of dividing the market into different group of people in the marketplace. It is done to increase and enhance the sale of Kombucha in the Malaysia. The market is classified by the firm on the basis of demographic, geographic, behavioral and psychographic areas. In demographic area, the company focuses on the age, income level, and gender and education level of the people. In geographic area, the firm identifies the weather, climate and pollution of the country that can help to implement the business activities in the Malaysia. In psychographic area, the company examines and analyzes the luxury oriented customers and social disclosures of the people to ear maximum outputs in such country. It has been noted that Remedy Kombucha also focuses on the behavioral factors such as awareness, attributes and values of the people (Anon, 2017). It also helps in evaluating the purchasing power of the consumers in the competitive market. It has been revealed that if the Remedy Kombucha wants to enhance and boost the sale and profitability then market segmentation is done by the firm Ho (Kim, Jae Ko and Min Park, 2013).
Targeting: The main target market of the Remedy Kampuchea is the middle class and upper class that accounts for nearly between 250-300 million. The company also is targeting the youth promoting them to embrace social message and positioning itself as a social awakener brand. The firm is also targeting women who mainly like Kombucha products and maintain high income level in the Malaysia (West, Ford and Ibrahim, 2015). Along with this, the firm also examines the tastes and preferences of the consumers in the new market to strive with competitors. The company can augment their profits and revenue without analyzing the effective and unique target audience. The target audience also helps the company to maintain a strong and unique image in the minds of the customers in Malaysia. It has been noted that market research is conducted by Remedy Kombucha to analyze the purchasing power of the consumers in such market. The company uses porter five forces analysis to determine the long term attractiveness of the market or market segment of the company in Malaysia (Armstrong et al, 2015).
Positioning: This strategy refers to an overall strategy that aims to make a brand occupy a distinct position relative to the competing brands in the minds of the consumers. After the various studies, it has been noted that positioning is good for the Kombucha products. It is one of most important strategies that used by Remedy Kombucha while implementing the business actions in Malaysia (Tanner and Raymond, 2015). By using positioning strategy, the company has been able to make a dynamic and significant financial position in the eyes of the consumers. The positioning strategy may influence the consumer perception in terms of a brand or product relative to the rivalries. The main purpose of the positioning strategy is to set an effective image or identify of a brand in the global market (Mellentin, 2016). This strategy also helps in identifying and measuring the appropriate niche market for a product, service and brand image. Positioning is a heart of any marketing strategy therefore, it also provides ample of benefits to Kombucha. Positioning strategy also helps to gain new consumers and succeed in securing the more customers than competing products (Roberts, 2012). By using this strategy, the organization can capture the entire market. Besides this, it also helps in attracting the different types of consumers in the Malaysia. Moreover, the organization can communicate and collaborate with consumers effectively and successfully with the help of positioning strategy (Solomon et al, 2014).
Differentiation: It is noted that there are various international and domestic companies manufacturing Kombucha products. Apart from this, various beverage brands are trying to enter into this market (Cottrell, 2017). Due to its health benefits, government in various nations are taking initiatives for manufacturing, regulating and marketing the production and consumption of Kombucha. Differentiation is one of the unique strategies that can be adopted by any firm (Gibbons & Rinker, 2015). Various campaigns and programs are conducted by the company to differentiate its products from the competitors (Brenes, Montoya and Ciravegna, 2014). The firm uses this strategy to set the appropriate prices of the product. This strategy is used by the firm to create a good value in the marketplace. Apart from this, differentiation strategy creates brand loyalty among the customers in Malaysia. This strategy encourages people for buying the products of Remedy Kombucha (Aschali, 2017). In addition, it eliminates the extra cost of the firm and furthermore, it provides various growth opportunities to the clients in the Malaysia (Huo et al, 2014). By using differentiation strategy, the firm has been able to know and analyze the plans, strategies and policies of the competitors. In this way, the firm can explore its brand image in the competitive market (Baschali, 2017).
Product strategy can be initiated by the company to gain rivalries advantages in the global market. A product strategy is the foundation of a product life cycle and the execution plan for the further development. This strategy helps the firm to increase and enhance of the demand of the Kombucha products (Anon, 2018). It is the process of bringing a new innovation to consumers from the concept to testing the products through distribution. It also improves quality of existing products to stay in the Malaysian market. The company uses this strategy to analyze and evaluates the size, features and quality of the competitor’s products. It will help the firm to tap the entire market of the Malaysia. This strategy helps the company to achieve business goals and objectives such as entering new market, selling more products to the customers and wining business from competitors.
An effective and unique product development strategy can also maximize the revenue and outputs but careful planning s required to reduce the risk of costly mistakes. This strategy helps the company to improve and enhance the quality of the products in the Malaysian market. Along with this, it averts the cost of Kombucha products to improve and boost the competitiveness (Anon, 2018). In this way, the company should use effective and unique product strategy to sell the Kombucha products in the international market. It has been stated that the firm should also focus on the product development strategy to create new products in the Malaysian market. New revenue can be used to promote new products. By continuous striving to resolve new problems and issues that consumers face, Kombucha is constantly creating the chance to generate maximum revenue. It has been stated that the firm should focus on the development and expansion of the new products to meet the needs and requirements of the customers. It also helps in creating a higher value proposition for the core demographics of a business and brand. Higher value proposition creates more repeat customers that can lead to higher revenue and outcomes. Innovative product strategy will attract maximum number of people in the Malaysia. Hence, Remedy Kombucha must focus on the product strategy to hit the rivalries and to earn maximum outcomes in the foreign market. The product overview of the product has been detailed below.
The pricing strategy is a process of finding rivalries of a product and service. This strategy is combined with the other marketing pricing strategies to retain the existing customers in the international market. A survey and research is done by the company to identify and analyze the prices of the competitors in Malaysian market. The company cannot attain growth in such market without analyzing the prices of the existing competitors. In this way, the organization can overcome the competitors in Malaysian market. The pricing strategy let the business to control and manage the competition by reducing and eliminating the losing market share and consumers to the competitors. By using pricing strategy, the firm can respond every move of the rivalries. As a result, the organization has been able to get better position in the market towards the various strategic decisions of competitors (Acosta, 2016).
If the organization is using pricing strategy then it will also help in online shopping. By using pricing strategy, the firm can also attract the online retailers in the foreign market. The pricing strategy provides ample of benefits to the customers after monitoring the prices of the competitors. This strategy maintains a balance between supply and demand of the products. Under this strategy, Remedy Kombucha should set the suitable prices of the products to enhance and promote the sale of Kombucha in Malaysian market. If the company set the suitable prices then it can also attract the lower class people in the competitive market. The firm needs to focus on the expectations and interest of the consumers to set the appropriate prices of the products. It will encourage more and more consumers in the Malaysia (Guisado-González, Ferro-Soto & Guisado-Tato, 2016). It has been found that unique and effective marketing research shall be done by the company to analyze the prices of the competitors. Apart from this, enormous campaigns and programs must also be help by the firm in the Malaysia to evaluate and identify the product cost of the competitors. By initiating this strategy, Kombucha Company can take various competitive benefits in the foreign market. Price is one of the significant elements of the marketing mix that helps to destroy the competitors in the new market. By using this strategy, the organization can become a one of leading companies in the Malaysian market (Acosta, 2016).
It is stated that promotional mix strategy can consist of various things that affects the growth of the firm. Promotional strategy helps the company to encourage the Kombucha products. Research is don e that details market research, budget and segmentation (Fuhrman, 2010). The company chooses promotional strategy to create wide range of customers in Malaysia (Anon, 2002). Apart from this, the organization conducts various campaigns, and programs to identify the right and potential consumers in the global market (Arris et al., 2016). Under promotional strategy, sale promotion can be done by the firm to maximize the sale and outcomes of the firm. The firm also maintains strong and unique relationship with customers to maximize the buyers for the product. Direct marketing is other option to promote the product of the firm. In addition, Remedy Kombucha can use digital marketing for enhancing the selling and revenue. There is high and immense competition exist in the Malaysian market therefore it is vital the marketer to choose their promotional avenue carefully and effectively. In today’s era, Remedy Kombucha needs to find right and appropriate way to promote their businesses and to compete with the competitors (Sun & Pan, 2011).
Online promotions can be used by the firm to beat and hit the rivalries in the global market. Besides this, the organization can use advertisement strategy to keep an eye on the choices and needs of the customers. In this way, the Kombucha can retain the target audience in the competitive market. Promotional and advertising strategy plays an empirical role to tap the entire market of Malaysia. It is an effective and unique strategy that helps the firm to implement the business actions and activities in the Malaysian market. If Kombucha uses attractive promotional methods then it can help the firm to grow and enhance the market share (Anonymous, 2010). Apart from this, promotional and advertising build and develop company’s reputation and image among the consumers (Cernivec and Stephanie, 2013). Remedy Kombucha should try to increase and enhance the promotions and advertising to inspire the large number of consumers (Anon, 2006). The sale and direct promotion can help the firm provide information to potential and effective customers that aids them in making unique and effective decisions. This can be beneficial for the new and innovative Kombucha products that are complicated to consumers. By using this strategy, the organization can build a good brand image in the international market. Furthermore, it a fundamental tool to motivate the customers for buying the Kombucha products.
It is a fundamental strategy that can be implemented by Kombucha Company to distribute the products in the Malaysian market. Distribution strategy is a strategy or plan to make a product or service available to the target customers through its supply chain (Anon, 2017). A plan and strategy is created by the firm that specifies how the company intends to transfer its products to retailers, intermediaries and end consumers (Chidi and George, 2013). The firm can use various types of distribution strategies to distribute the products across the world. The company cannot distribute the products in Malaysian market without using various distribution channels and strategies (Lobo & Shenoy, 2015). The ample of distribution strategies include intensive distribution, exclusive distribution, selective distribution and different distribution strategy (Anon, 2011). Along with this, distribution channels include wholesalers, retailers and distributors. It has been analyzed that Remedy Kombucha should use distribution strategy to fulfill the needs and expectations of the consumers (Blut, Teller & Floh, 2018).
Conclusion
From the above mentioned analysis, it has been concluded that Remedy Kombucha can easily expand and explore the business in Malaysia by making effective and unique marketing plan. To expand and explore the business, marketing research and survey is done by the company in the Malaysia. Furthermore, the firm selects unique entry modes to initiate the business in Malaysian market. The above analysis shows that Remedy Kombucha uses effective STPD strategy and marketing mix. It has been found that it is the continuation part of the assignment 1 which explains the marketing plan for Remedy Kombucha Company. It is stated that the firm can overcome on the rivalries after analyzing the marketing conditions of the Malaysia. Now it is recommended that the organization should focus on the business level strategies to stay in the competitive market.
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