In order to learn more about the population a market test is conducted in Sends Supermarket in ROI. Purchase intercept interviews were conducted with the people visiting the supermarket to better understand the profile of buyers by gender, frequency of garbage bags purchased, market share of major brands, motivators and concerns on purchase of garbage bags and their competitive advantage over Dover Roll. This case clarifies about market analysis procedures, methods for creation of customer value and other things that are required to be analyzed before launching a new product.
Issue Company had already invested one million dollars to purchase new machines and had already come up with their new product before doing any research. And now they are testing whether or not the product fits to the customer’s best interest or not. We are here to analyze whether this organization is marketing oriented, to evaluate methodologies used in research, and to find the ways to market the product and the justification to the launch.
The Analysis To analyze the acceptance of new Easy Close garbage bag In the market and to study about Its profitability we need to do an Industry analysis. This Industry analysis Is one by using Porter’s Five Forces Model. The Industry Is high In competently with companies such as Gerald, Dover Roll, DRY w/handle, Goleta, sends to be competing with. Along with high competition, we can also see that the barrier to entry is very low as capital to be invested is less and that even small supermarkets and stores as well can make such garbage bags with their brand names.
As the raw material for such a product “plastic” does not seem to be a rare material and that it is not very difficult to get and is cost effective to buy at bulk, the suppliers here to not have much of a say ND thus reducing their bargaining power, whereas, the customers here are on full on power. Availability of plenty of options to choose from and given the fact that there is no switching cost involved, the buyers have high bargaining power here.
But, the threat of substitute goods is rather low as there might be other options such as paper bags and cloth bags but compared to plastic bags they seem to be less convenient due to their leaking nature. Having stated the Industry analysis of Plastic bag industry in Brazil we have done SOOT Analysis of Ad- Liner Packaging Inc to see The major strength of the Official bag is that it is has product differentiation. Basically, it has been able to identify what customers like to have in the bag.
Furthermore, while the other bags could only be used as a garbage bag, it could be used for different purpose, such as: storing the sheets, dirty clothes, shoes, towels, etc. And also it could be hanged in wall. Additionally, it had drawstring closing feature which would further increase the ease of use for closing or tying the garbage bag. This was still not practiced by other competitor in the market. The product is munched with proper market survey and keeping customer in their mindset. Hence, they have been able to produce bags as desired by the customer.
Weakness: The bag has given more focus on usability only. From the data in Appendix 4 (page 20), it is clear that price factor is the minor motivator to customer indicating its price is comparatively higher in the market. Len the survey made, it was mentioned that most of the purchase made is directly or indirectly affected by the price of the bag. Furthermore, Dover Roll is a popular brand name. In such case, it has not been able o establish its name in among customers. They are less into building brand and advertising.
Opportunities: As Brazil being member of BRICK nations, its economy is one of the world’s fastest growing economies. Hence, this means economy of the garbage sector will also continue to grow well in future. With good enough marketing strategy, Official will continue to expand its business in future. With customer being unsatisfied with the market leader like Dover Roll with its handle system, there is high probability for customer switching towards Ad-Lieder. However, Ad-Lieder should be able to formulate roper marketing strategy in order to lure customer for brand switching.
In SAA Paulo, there was no recognition of any brand. Hence, it will be easier for Ad-Lieder to laugh its product there. Threats: The major threat for the Ad-Lieder was Dover Roller. In city of ROI De Jeanine, the brand value of Dover was high. People were ready pay premium price for the Dover brand. This will be the hard nut to crack for Ad-Lieder. It is critical for any firm to identify its core strength and weak spot in it. Furthermore, company should be able to identify opportunities in market not seen by other competitors and must act upon it.
Additionally, market poses threat to company also. This should be tackled by the company before it is too late to act upon. Ad-Lieder should be able to utilize the available strength and opportunities to it in order to gain advantage over rivals and minimize the threat along with its weakness. Marketing orientation In order for a business to be marketing-oriented, they need to focus on needs of the market. They need to be able to address the needs of the market. We can see in the case that company initially came up with the product even before trying the actual acquirement of the market.
Furthermore the product is not customer focus as they produced the product and then tried to identify the market that best fits the product. The company should have initially tried to identify their target market before producing the product. Without identifying who the probable customer are, the company producing the product points out to the fact that they are not marketing- plays a significant role while introducing the product. In the case we see little emphasis given by the company regarding those curtail decision. This highlights to he fact that the company has given little emphasis towards marketing decision.
Evaluation of methodology used The methodology of focus group and purchase intercept interviews is very effective because of following reasons. 1. Focus group consists of target customers. I. E. Middle aged women. 2. Focus group has different variety of women. Such as one focus group consist of housewives and another consist of apartment wives in SAA Paulo and it consist of only apartment wives in ROI De Jeannie. 3. Differences in lifestyle existed between participants from ROI and SAA Paulo. Such as: professional ND non professional, activeness in exercise program. . Guide for intercept interview has been made in such a way that women participating feel like they are having women’s talk rather than being interviewed. Learning from research findings The research has been able to show the variety of consumer behavior shown within a country with same cultural background. This research has made it clear how diverse the consumer perception and rational behind their decisions could be. It is important to make initial research before launching any product, as it will provide information bout the customer taste and preference.
Furthermore, it will ultimately save cost of failure in successful launch of any product. From the research it can easily be understood the importance of women as decision maker in house hold activities. Here, it is mentioned that about 74. 14% of purchases are in the hand of women. Although this data belongs to Brazil, the number is more or less similar in most of the countries especially in home appliances purchase. Hence, for home appliance sales in general, marketing strategy should be taken by making considerations of women.
Research support on the launch of product Research also showed that the purchasing power of the people in Brazil increased and that enhanced the buying behavior of people there, which shows that there is scope for Ad-Elder’s plastic garbage bag. Similarly place of launching can also be identified as I. E. South east for better business as 50% of business comes from 42. 6% of the population. Conclusion We see that company initially came up with the product even before trying the actual requirement of the market. So it would be even better if they have conducted this search before the production of this Climb Fiche Facial.