PGBM15 Evaluation of Marketing Theory for Product Promotion of Wild Flavors Inc Assessment Answer
UNIVERSITY OF SUNDERLAND AND
SEGI COLLEGE KUALA LUMPUR
Module: PGBM15 Marketing Management
Assessment Title:Critical Evaluation of the Contribution of Current
Marketing Management Theory and Practice
Assessment: Individual Assignment
Word Count:3500 words (+/-10%) excluding Appendix and
Mode of Assessment:Individual Report
Weighting within Module: 100%
PGBM15 Marketing Management Assessment
Title: Critical Evaluation of the Contribution of Current Marketing Management Theory and Practice
Learning Outcomes Assessed
Upon successful completion of this module, students will have demonstrated
K1 – That they understand the merits of particular marketing concepts when applied to selected business situations.
K2 – That they can understand the potential impact of factors in the external environment on the marketing activities of organisations.
K3 – That they have understanding of the major decisions that organisations confront in satisfying market-place needs.
K4 – That they understand market planning in organisations.
S1 – How to conduct research using relevant marketing journals and business documentation
Fruit and vegetable sales reach billions of dollars every year in China. Their juice consumption fluctuates around 15 litres per year per person. This may seem relatively small in comparison with some other nationalities (3 times less than in the UK) and it is also under the global average. However, with 1.5 billion inhabitants, China remains a very interesting market. Most residents are drinking juice at least once a week. Orange juice is the dominant product in this market. However, its share is declining because Chinese consumers are getting more and more interested in original and exotic flavours, such as pomegranate, grapes, or carrots. They are also particularly interested in mixtures of fruits or vegetables, or both mixed. Smoothie style drinks are all the rage because they like the flavour mix and look for the nutrients of each component.
Your task as a marketing manager in a global soft drinks organisation that produces fruit juices and / or smoothies which targets a consumer market of younger, health-conscious, up- market consumers, is to assess the attractiveness of introducing a new brand of fruit juice and/ or smoothie product into the Chinese market.
The task is divided into three sections and you are expected to address all of the following:
- You are to select a global soft drinks organisation that produces a range of fruit juices and /or smoothie drinks.
- You are the newly appointed Marketing Manager of this category of products.
- Your role is to evaluate the implementation of a market opportunity to launch a completely new and appealing brand of fruit juice and / or smoothie product into China.
This assignment is divided into three sections. You will need to complete all three sections in order to successfully complete the assignment. You will need to achieve an overall mark of 40% in order to successfully complete this module.
Please ensure you submit your assignment in Report Format.
In your role as Marketing Manager:
Part 1. Using appropriate knowledge of business and marketing philosophies and concepts, critically evaluate the strengths of the organisation’s strategy in delivering value with respect to its current brands and customers. (30%)
Part 2. Research and evaluate the dynamics and trends within the competitive and external environment with regard to the fruit juice and / or smoothie category. Produce a situational analysis identifying the key factors that underpin the opportunities and challenges for a new brand of fruit juice and / or smoothie product in China. Based on this, and your earlier analysis and findings, ‘suggest’ the potential target market and include a proposed market research proposal that would enable you to qualify and underpin your ‘suggestion’. (note – you are not expected to undertake primary market research) (30%)
Part 3. As a newly appointed marketing manager and in accordance with your knowledge of the marketing planning process, make appropriate recommendations to build a sustainable new brand. Your suggestions for implementation must be underpinned with relevant theory
and real-life/academic case studies. (40%)
You are to suggest ways on how you would significantly leverage the new brand of product in making it the market leader in the fruit juice and / or smoothie segment in China.
Your arguments, findings and recommendations should be supported by theories, facts and figures published within academic books, journal articles, recognised business magazines and market intelligence reports.
Part 1. Students are expected to critically evaluate marketing management theory with applied discussion relating to the current organisation and its existing brands. In doing so, students will consider how the organisation delivers value to consumers through the adoption of marketing theory and concepts; these may include, however are not limited to; market orientation and holistic marketing approaches.
Part 2. Students should apply relevant frameworks to critically evaluate the competitive and external environments for this category of products. Students must demonstrate that they have undertaken research using a wide range of relevant and current sources which must be referenced. In this section students will be expected to synthesise the market intelligence from their research, demonstrating the ability to evaluate what is relevant and significant for the organisation. Students will propose a market research strategy – students are not required to undertake primary research.
From the knowledge gained in Part 1 and the evaluation undertaken in Part 2 students will have identified key opportunities to launch a new sustainable brand of product of fruit juice and / or smoothie in China. This will form the basis of objectives and recommendations.
Students should provide a product rationale and overview, followed by formulation of objectives and recommendations. With reference to the marketing management process students will make recommendations on segmentation targeting and positioning (STP) strategy, brand building, marketing mix, shaping the market offering through application of
Wild Flavors Inc. is the producer of colours, food, health, flavours ingredients. It was established in 1994 at Kentucky, USA (Wild flavours, 2020b). The company produces cheese, dairy products, cereals, snacks, savoury and sweet along with non-alcoholic and alcoholic products. Wild Flavors Inc. has its food chain and suppliers worldwide. Since its establishment, Wild Flavors Inc. has shown continuous growth. The industry chain is spread over the USA, Middle East, Europe, Africa and some Asian countries. The company is committed to the development of innovative products to maintain its top position in the global market. Under the supervision of experts, Wild Flavors Inc. delivers the best ingredients in the food industry. Now the company decided to launch a new orange fruit juice named ‘Zumo De Naranja’. Wild Flavors Inc. will take different marketing strategies for the introduction and improvement of its products in the global market. These kinds of strategies help the brand to learn about the interest of its customers and to promote its products for the growth of the business. The orange juice Zumo De Naranja of Wild Flavors Inc. will be made especially for the health-oriented people. The product has a new scope to captivate the market and help Wild Flavors Inc. to establish in the global market. The new fruit juice should stand upon the expectations of the customers. The efficiency of a brand opens new opportunities for the company and makes it well sufficient to compete in the global market.
1.0.Par 1: Estimation of Marketing Management Theories
1.1. Marketing orientation
The marketing orientation is a theory of business that focuses on the identification of customer needs and wants to fulfil them (Market Business News, 2020). The success of a company depends on oriented discoveries and meets the needs of a customer. Many marketing houses consider market orientation as coordination between the buyer and seller. It is a separate process. The structure, behaviour, norms and values all are included in this orientation process (Investopedia. 2019). Market orienting is the opposite of the orientation of products. It is very much essential for this competitive business world. By understanding the needs of customers, creating brand loyalty is the basic foundation of the growth of any company. Wild Flavors Inc. is a market-related company, so its focus is on both product and the business market. It follows the approach of market orientation theory to gain customer satisfaction. The organization decided to launch a new product, Zumo De Naranja, an orange juice for refreshment purposes. For the growth of this product, the company should focus on how the customers can relate with this product and what the special touch they can put in this product so that the customers easily attract towards it.
1.2. Strategies of Social Marketing
The strategies of social marketing help to reach a huge number of customers with the help of Web marketing (Bajracharya, 2018). It increases the perception of the brand and product to the customers. It helps to develop services, products and communication by understanding the needs of customers. For social media publicity, Wild Flavors Inc. will have to introduce Zumo De Naranja on social platforms. To promote the business, the product should be advertised on Facebook, Google+, Twitter famous social platforms. Other social platforms should be used for informative advertisements, like print media, hoarding in public spots, advertisement in Tv, radio (Eagle et al. 2017). Companies may tie-up with some big cinema halls to promote the product at the time of intervals. Wild Flavors Inc. should work upon these strategies to reach the consumers by promoting its new orange juice easily. Wild Flavors Inc. has an international strategy to produce a healthy and nutritious product. It can promote its product by referring to it as a 100% pure fruit juice and carrying a large amount in every bottle. With the special foundation of the company around 80 years, Wild Flavors Inc. combined its products with the markets (Wild flavours, 2020a). As the technical knowledge of flavours, Wild Flavors Inc. tries to promote its new fruit juice among its worldwide customers. For achieving the goals of being the best ingredient company, Wild Flavors Inc. will continue its promotion in all aspects and digital as well as social media platforms.
1.3. Holistic Marketing
Holistic marketing is one of the philosophies of business marketing. It considers all parts of a business and gives a purpose for every person and activities, which are related to the business (Pahwa, 2020). If all the parts of a business are functioning towards a proper direction with the same objectives then the improvement of that business can be increased. This concept of marketing believes in a broad and united perspective to achieve the best results. Common goals, integrated activities and aligned activities are the philosophy of holistic marketing. It influences the marketing strategies of a brand. It also tries to update the organization about social responsibility through the business.
Wild Flavors Inc. empowers the company's brand with the product. The mindset of customers is changing rapidly. They not only want to buy a product but also want to buy a brand. Consistency is very important for the growth of a company as the previous products of Wild Flavors Inc., the new fruit juice should stand upon the expectations of the customers. The efficiency of a brand opens some new opportunities for the company and makes it well sufficient to compete in the global market. The concept of holistic marketing tries to involve all marketing brands together. It focuses on creating a brand image and recognizing the exact position of the brand in the market.
Product: Wild Flavors Inc. is the main producer of fruit juices including litchi, pineapple, and pomegranate. Now it will be going to launch an orange fruit juice. It also produces the cheese powers like Parmesan cheese, Swiss cheese, Cheddar cheese and Romano cheese. Wild Flavors Inc. uses natural colours for its food products. It also produces mint oils (Wild flavours, 2020a).
Place: Wild Flavors Inc. spreads its business chain worldwide. The countries associated with production facilities are Beijing, Dubai, Amsterdam, Toronto, Tarapur, Manaus, Port Elizabeth. The subsidiary countries are Kiev, Luton, Mexico City, Istanbul, Tokyo, Moscow, Porto, Shanghai, Warszaw (Wild flavours, 2020b).
Price: The price of the products of Wild Flavors Inc. is different. The pricing of products depends on the quality, quantity and tastes of products.
Promotion: Promotion of a product is very important for reaching maximum customers. Social media, print and digital media are the platforms to promote a product of a brand (Clemence, 2017). Wild Flavors Inc. puts its attention to promote its new product and ensure the development of the company.
1.4. Relationship Marketing
Relationship marketing ensures a long-term relationship with a customer. This marketing strategy has targeted the market activities of existing customers as well as tried to attract new customers. It creates a strong bonding and emotional connection between the product and the customers (Search Customer Experience. 2019). Relationship marketing is the face of CRM. It focuses on the loyalty of customers, engagement with them. Wild Flavors Inc. tries to make a strong bond with their customers and ensure loyalty from them also. For the success of new orange juice, the company should concentrate on the relationship strategy with the customers. Gaining trust in a particular brand is a very difficult thing in this competitive global market. With this relationship marketing theory, the company can earn the trust of the customers.
2.0. Part 2: Critical analysis of the external environment
2.1.Analysis of the Chinese market’s Competition and External environment
2.1.1 PESTLE analysis of China
PESTLE analysis helps us in gathering knowledge about factors outside the business environment but has a significant impact on the business outcomes of Wild Flavors Inc.
Table 1: PESTLE analysis
Source: (Developed by the author)
2.1.2 Porter’s Five Forces analysis
|The threat of new entry (High)||The threat of new entrants is high for Wild Flavors Inc. as the Chinese market is rapidly expanding.|
|Competitive rivalry (High)||Various juice-making companies already exist in China such as Beijing Huiyuan Food and Beverage Co. Ltd, the China Haisheng Juice Holdings, Coconut Palm Group Company Limited and some others (Infoseekchina, 2020).|
Hence Wild Flavors Inc will face a high level of competition as the older companies already know the taste of the consumers.
|Bargaining power of the suppliers (Low)||Various kinds of suppliers like manufacturer, wholesalers and distributors are present and dependency on them increases the bargaining power (The-reseller-network, 2020). It will be a challenge for Wild Flavors Inc.|
|Bargaining power of the consumers (High)||A large variety of products are available which increases the bargaining power of the buyers. The availability of fruit in the market is also adequate which will be a threat for a new entrant like Wild Flavors Inc. because it will face bargains.|
|The threat of substitution (High)||The present generation is highly aware of the factors that affect health. They are interested in health drinks and fruit juices over any other soft drinks as they contain sweetener and artificial flavours. Hence, the threat of substitution is largely minimised. But still, some amount of threat remains as some other health drink company can take over fruit juice.|
Table 2: Porter’s Five forces analysis
Source: (Developed by the author)
2.1.3 SWOT analysis
SWOT analysis will help to identify the opportunities, threats, strengths and weakness that will be encountered by Wild Flavors Inc. while growing its business in China.
|Strengths: ||Weakness: |
Table 3: SWOT Analysis
Source: (Developed by the author)
2.1.4 Identified Opportunities
From the above analysis, the following opportunities can be identified:
- Zumo de Naranja from Wild Flavors Inc. will be appreciated by all the age groups because of its natural content without artificial colour and zero-sugar use.
- The orange flavour is liked by a large share of the Chinese population and it is rapidly increasing its imports from other countries (Fruitjuicefocus, 2019).
- The labour cost in China is cheap as billions of the population is still under the poverty line. It will help Wild Flavour Inc. to earn a fair share of the revenue.
- The juice production in China has grown over a large extent in the past few decades. It is because of the fall in the production of carbonated soft drinks due to market saturation and health issues. It will be an opportunity for Wild Flavours Inc. to launch its orange juice in China.
- Political and legal factors in China are favourable for a new company to start a business in the country as the laws ensure the security of products as trade laws are transparent.
- The Chinese economy is at a growing phase which is enhancing the status of the people. This ensures a high rate of sale of orange juices by Wild Flavors Inc.
2.2.1 Selected target market
The growing market in China is extremely suitable to launch a new fruit juice product in the country. The areas that are most suitable for expansion of business include Guangxi and Sichuan provinces. Due to its demand for high quality and seasonal fruits by the middle-class customers, most of the country's orange tree plantation is in the above provinces which will facilitate the Wild Flavors Inc. for acquiring raw materials at a low price. Some new names are also emerging as they are contributing to orange production like Chongqing, Hunan and Hubei as well as other western regions (USDA Foreign Agricultural Service, 2018). Revenues generated by the orange juice production companies have reached the mark of US$761.1m in 2020. The market research shows that the revenue generation is expected to grow annually by 5.9%% in the next five years (Statista, 2020b).
2.2.2 Market Research Strategy
Profound knowledge about the country’s social structure, economic conditions are required to analyze the requirements of the consumers. An organisation should implement some research strategies to gather information required for initiating a new business in a foreign land. Lean market research strategy can be used for collecting less amount of quality data from the consumers rather than long surveys (Albro, 2020). It ensures that communication is not done by the third party and directly with customers. The customer’s need is at the highest priority and Wild Flavors Inc. will renovate its business techniques to fit the consumers' demand. Low-cost technologies are an added advantage which will keep the business in a safe condition during initial stages. Some other research strategies like a survey (the online survey is most relevant), interviews, identifying focus groups and observationcan also be considered as options for Wild Flavor Inc. to identify the positive sides of the target market for its business to establish and grow in future days.
3.0. Part 3: A New Product Launching
3.1. The Overview and Rationale of the Product
A global company named Wild Flavor Inc. is going to introduce a brand-new product in the market of Fruit juice in china and the product is named as ‘Zumo de Naranja’, which is a quality orange juice. Nowadays the Chinese market of fruit juice is making an eye-catching impact in the global market and that is why the Wild Flavor Inc. is launching this new quality product in the Chinese market. Some reporters of this sector have reported that the Chinese fruit juice market will be able to gain 4% value of CAGR by 2025 (Market Watch, 2020). Various people from different parts of China have added orange juice in their daily breakfast table and that sounds good for the global organization.
3.2. SMART Objective
Objective 1: To increase the sales of the company by 15% in two years
|Specific||Wild Flavor Inc. has fixed its goal to achieve the growth of sales in the Chinese market.|
|Achievable||Wild Flavor Inc has to set its ambition to grow the sales to increase its profit in the Chinese market.|
|Measurable||Measuring the total revenue can help to assess the success of the objective |
|Realistic||The purpose of Wild Flavor Inc is very much related to real-world needs, it wants to grab a stable position in the market of China by launching ‘Zumo de Naranja’, an orange juice for the people of every generation.|
|Time-bound||The organization is very serious regarding their achievement and for that, it is targeting to fulfil its ambition within the upcoming 2 years.|
Table 4: SMART Objectives
Objective 2: To increase the market share by 2% within two years
|Specific||Increasing the market share is important for creating a competitive advantage in the market |
|Achievable||Focusing on differentiation regarding the new product can help in attaining the objective |
|Measurable||Evaluation of the market share and market position can help to assess the objectives |
|Realistic||This is objective is essential to enhance the brand value in the market |
|Time-bound||Wild Flavors Inc can attain the objective in two years |
Table 5: SMART Objectives
3.3.1 The STP model or Segmentation, Targeting, Positioning Model
The approach of the STP model is very helpful to develop and provide messages to the targeted and segmented audience and it is used to target the communication medium digitally (Cousins, 2020).
Demographics of Customer: The global Company Wild Flavors Inc is looking at the matter of demography and that is why it is preparing to launch the product of orange juice, which is suitable to drink for every generation of people from little children to old.
The lifestyle of Customers: The customer lifestyle is continuously evaluated by Wild Flavors Inc to know the behaviour and hobbies of the consumers. The organization is mainly going for the people who are very concerned about their health and also like to take soft drinks on a daily or weekly basis. The company is using no sugar and applying a slow process in juicing to convince the people of the young generation with a high consciousness of health in the fruit juice market of China.
Targeting is the most important thing in the field of marketing so the organization has to target its population for the growth of the business and in this case, Wild Flavour Inc is following the strategy of undifferentiated marketing. World Flavour is not targeting any separate community or a different group of people, they are targeting the entire potential population of China. The product ‘Zumo de Naranja’ is a kind of orange juice and it is effective and healthy for every generation of people from little too old. For the effectiveness of this juice, the demographic difference is reduced and it is helping to reach the whole population and hitting a huge number of consumers.
The global organization Wild Flavor Inc has chosen the strategy of Distribution as a positioning strategy to give the position to the product ‘Zumo de Naranja’ which is made of pure juice of the orange. The Distribution strategy is so famous because of its uniqueness to attract all generations of people by highlighting the unique attributes of the particular product. This feature of this positioning strategy will help to retain the uniqueness of the product and to draw the attention of consumers at a large level (Corporate Finance Institute, 2020).
3.3.2. Brand Equity Model:
The brand is a very effective term and it is very important to create for any organization in the whole world. Wild Flavor Inc. has used the Brand Equity Model to create their brand. This model has four steps to follow and they are the identity of the Brand, the meaning of the brand, brand response, and brand Resonance (Vasileva and Vasileva, 2017). Some brief description is given below.
Identity of Brand: At first the organization has to be sure that its brand will stand out and the consumers will be able to recognize it and the awareness will be there for the organization. The Wild Flavors Inc has to be sure about their brand awareness and they have to address the problem of their customers. Thus, the company need to develop a slogan for its brand recognition. The slogan is “Drink Zumo De Naranja it will please your heart”.
Meaning of Brand: In the next step Wild Flavors Inc has to understand the meaning of their brand and they have to find that the quality of the juice is meeting the needs of the consumers or not and they have to increase the reliability of the product.
Figure 1: Brand Equity model for Wild Flavors Inc.
Source: (Developed by the author)
The response of Brand: The Company has to find the fillings and the judgments of the customers mean they have to be aware that consumers are judging the quality, credibility, and superiority of their brand and they are comparing how good the brand is than other companies. According to these factors, the customer will respond to the ‘Zumo de Naranja’ of The Wild Flavors Inc.
Brand Resonance: The Company will discuss its fair-trade policies at the home page of its website for providing knowledge to customers regarding the product.
3.3.3 Marketing Mix
This is a strategy that is quite different and applied by organizations for the promotion of any particular product in a market (Solimunand Fernandes, 2018). To crack the market of China Wild Flavors Inc can choose a marketing mix of 4Ps and this will be helpful for them.
Price: The pricing is dependent upon the supply and demand relationship but Wild Flavors Inc will do the pricing at the competition based to spread their business and to reach the consumers very easily.
Product: The product of Wild Flavors Inc is ‘Zumo de Naranja’ and it is considered based on the product benefit. This organization is providing core products that are with zero sugar and it is actually by using the technique of slow juicing and Wild Flavor is providing a free offer on every purchase of orange juice.
Place: The wild Flavors Inc is launching the product in every place of the market like from supermarkets to each store and reaching a maximum population.
Promotion: It is an advertisement technique taken by Wild Flavors technique, they are promoted through various mediums like banners, TV, and websites. This process will help the company to be familiar with the consumer's needs and consumers will also be able to familiar with the product.
3.3.4. Implementation and Control:
The organization can apply various theories and strategies by the method of Implementation and control and is connected to the growth of the company for a long time. Wild Flavors Inc. has sealed itsbrand-new product ‘Zumo de Naranja’ made of pure orange in the Chinese market by identifying different strategies. The ability and resources management will help Wild Flavors to implement their business.
This model stands for exploration, preparation, implementation, and sustainment Model. This model is increasing the effectiveness of various methods and efforts of implementation.
Figure 2: EPIS model
Source: (Khan, 2019)
The phase of Exception: The requirements and needs of consumers are identified by this phase and it helps to find out what the healthy drinks of China for the Wild Flavors Inc.
The phase of Preparation: This phase is useful to identify what are the barriers in the way of implementation for Wild Flavors Inc. It is used for both contexts and for finding the potential barriers.
Implementation Phase: This is the phrase of applying the theories and strategies.
Sustainment Phase: Wild Flavors Inc is using this phrase to maintain the strategies which are implemented earlier and it can bring the changes also (EPIS Framework, 2020).
This analysis and study will help Wild Flavors Inc. to promote its new product efficiently in the global market. With the help of different strategies, the company can grow its production and profit as well. This study helps to understand the value and risk that a company may face at the time of introducing a new product. The orange juice Zumo De Naranja of Wild Flavors Inc. will be made especially for the health-oriented people. This orange juice will be available for all the peoples who belong to various age groups and the peoples of different economic backgrounds. The product has a new scope to captivate the market and help Wild Flavors Inc. to establish in the global market. The orange juice can adopt a tagline to attract customers towards the company and its products. This is the most powerful idea of promotion. The marketing team should try to capture new connections through marketing strategies. The selection of logo and the colours is most important for the approach towards the customers. As every age of people can consume this product, the company should keep in mind that the taste of the people differs based on their ages. So to reach among all the age groups and earn their acceptance, Wild Flavors Inc. requires to be very focused toward the promotion and marketing programs. By understanding the needs of customers, creating brand loyalty is the basic foundation of the growth of any company. The company is committed to the development of innovative products to maintain its top position in the global market. As a part of the manufacturing industry, Wild Flavors Inc. should also look at the price of the product. The product should be in the hands of the people from a different economical background. If the price becomes moderate and the quality of the product is good then it will be very easy to connect with the customers. As much as the customers are going to connect with the product, automatically they are making connections and trust with the brand.