Blair Water Purifiers India

Blair Water Purifiers India st stationgic selling mean process Presented by Reham Mohamed Moustafa Yara Shahwan Dian Zork any(prenominal) Rania Zeid T ark Zeid Strategic analysis ? The Audit indicant psyche ? S rumpning the External Macro purlieu ? Political jural ? sparing constituents ? Sociocultural factors ? Technological factors ? Scanning the internal and outside micro surround ? Internal- env pushs analysis ? External microsurround analyses ? Demand forecast ? End Users necessitate ? Factors impact consumer behavior ? Consumer buying stopping point process ? competition analysis The grocery store gross r chargeue chart in 1996 ? The result mapping technique ? weight down combative military posture assessment ? SWOT analysis ? TOWS analysis ? mount objectives ? Setting Strategies ? Our suggestions ? Porter Generic Strategies ? Mckinsey matrix ? Ansoff Growth Strategy ? break ? Targeting ? homeing ? Entry Strategy recommended Strategic analysis Strat egic planning precedes trade planning by providing a framework within grocery storeplaceing plan might be formulated. ground on the assessment of 1. organisational capabilities 2. Threats from environmental forces 3.Competitors strength and weaknesses 4. Customers require 5. Demand This mustiness be do through the following cadences The Audit breaker point Step star Scanning the External Macro environment any merchandising schema must develop out of a diminutive understanding of the environment. This is important to Identify cheeks strategic position. patch up on the future of the organic law. Matching geological formational resources and capabilities For scanning a office environment we should use the PEST model, as it lead scan the whole external environment to leave behind management clues roughly strategic decisions pic pic Chatterjee analysis in the dickens visits was centred moreover on the urban cities neglecting the rural ones and this is a drawback a s the rural cities in India think for about 80% of the population, his purpose was to convey recommendations on commercialize place entranceway and on elements of entry strategy. Political legal Chaterrjie confirmed that India is attractive to hostile investment through liberalization outside(prenominal) companies were taxed on income arising from Indian operations and accept taxes on any interest, dividends and royalties receive The disposal offer favour commensurate tax treatment if inappropriate investors go out locate on one of the free zones Tax rate is soaringer(prenominal) than the USA, however the harvest-time on investment is advanceder than USA Trademarks and patents were protected in India Legislation in India was expensive and protracted that foreign firms choose arbitration Our suggested improvements and comments He should have examine the following Monopolies legislation to put off against any monopolistic actions that may appear in the futu re environmental protection law Employment law and this is important if the merchandise entry leave be joint accident or attainment sparing factors Chatterjee analysis completely missing the economic factors, as he didnt analyze the Indian economy in any way He should have analyzed the following Interest rates Inflation rate Business cycles Unemployment rates Dispos adequate to(p) incomes As these factors argon important to give insights about the economic conditions and the economic harvest-time for the next years so as to k nowadays whether the market is potential for entry or nonSociocultural factors Chaterjee identified his lead market to be around 40 one meg million households and he identified their withdraws and behaviour, but he baffled identifying the whole sociocultural factors from the following perspectives Population demographics population surface, age dispersal , religion ,social score are important factor to be analyzed by any firm before figu reing any market Income distribution Levels of education accessible mobility Work and leisure timeThese factors are important especi everyy that the target market for him was the rich wellhead-educated in high spirits social crystallize so its important to identify this class and its growth Technological factors Chatterjee analysis emphasized that engineering science was altogether obtain open in large Indian cities the lack of adequate distribution and communicating infrastructure in rural India meant that any market entry would drive with larger Indian cities most likely in the west coast. simply he should have analyzed many other(a) aspects regarding this issue regime spending on research Government and industry focus on technological efforts The speed of technology air New discoveries and development sum up of obsceneness Step two Scanning the internal and external micro environment In this step we will start by analyzing the internal and external microenvir onment whence finalize it by the swat analysis, which was missing in chatterjees study. He ignored mainly the microenvironment regarding the suppliers, stakeholders and intermediarys . He only analyzed consumers and competitors. pic 2-1 internal-environment analysisEmployees Blair Company employed over 4000 people with 380 having adept backgrounds and responsibilities Cash Flow telephoner gross sales revenue for 1996 would be roughly $400 million with an expected profit close to $50 million Annual Growth in sales revenue averaged 12% for the one-time(prenominal) 5 years Capital assets ignored by Chatterjee gross revenue in the international disagreement would r for each one almost $40 million in 1996, about $70 million would come from Latin and south America, $30 million from Europe and $40 million from south Asia and AustraliaMaterials ignored in the analyses though its important to scan the need materials for operation and theirs approachability in the market, he only poin ted that importing a few anchor dowerys would be necessary at the start of the operations The Mckinsey 7 S model must be utilise here to finalize the step of internal selling audit and this wasnt done by chatterjee Mckinsey 7S pic By analyzing these 7S we can know the firms core make d at one times and its warring advantage, which can be augmented for virgin market entry. Check tip for internal auditWhile doing internal audit for strategic analysis, we can also use the below check list to recognize the organizations strength and weaknesses and it must be weight because some weaknesses are of less grandeur than others , while other strengths are of more importance than others 2-2 external microenvironment analyses Stakeholders these were ignored in the analyses although its important to scan the stakeholders for the organization Suppliers again it was ignored in the analyses, our suggestions that the analyses of the suppliers must have be done from the following perspective sTheir number, their prices, their bargain origin (if any), their strategic alliances with competitors (if any present), their distribution channels, their management structure Consumers and demand forecast Consumers analysis is essential for any strategic planning as they are the main concern for the organization and this must be done through Demand divination Consumers (end users needs) outset Demand forecast Chatterjee estimated the market potential establish on store unit sales estimates for a 10-year period for 3 similar crossway categories vacuum cleaners, sewing machines and colour televisions.In improver a Delphi based research firm had provided him with estimates of unit sales of Aquagard, the largest selling body of irrigate supply purifier in India. Chatterjee had used the data in two vaticination models on hand(predicate) at Blair Company a enormous with common chord subjective scenarios - vivid, optimistic and pessimistic. But it was ultraconservative as th ey described only first time sales not replacement sales and it only applied to industry sales in larger urban areas which was the present industry focus. Second End Users needsThe target surgical incision was around 40 million households plus those in another 4 million households that share common needs. They placed quilt and product choice. They liked foreign shits and would have higher price for such(prenominal) brands. One thing that learnmed certain was that many Indians felt the need for improve piss feature. Folklore, newspapers, consumers activities and government officials regularly reinforced this need by describing the poor prime(a) of piss. Quality suffered especially during the monsoons and because of numerous leaks and unauthorized withdrawals from the water systemBetter educated, wealthier and more health conscious consumers took locomote to protect their family s health and use water purifiers to purify the water all over the year. This is the target ing redient for Chatterjee. They are people who value shelter and product choice. They saw consumption of material goods as a way to a higher quality of career. o His analysis was missing forecasting the growth of this segment as his potential market is based on the educated aware segment but he missed forecasting the growth of this segment as the growth of the segment closely relates to the growth of the sales The analysis also missed a deeper look at the target segment. From our point of flock, market survey should be conducted to show in details the target segment preferences, their demographics (age, social class, occupation, style of life) whether they like flavours to be added in the water or not, their ethnic direction, even their political views (if they are anti-Americans or not) as these factors may affect potential sales in the short and long terms . Consumers in the target market needs ( check to Chatterjee) can be summarized as the following 1) Product mathematical oper ation to ingest sediments, bacteria and viruses ) Purchase price this is only concern for consumers who boiled water who count for 50% of the target market 3) Ease of installation 4) imprimatur and availability of financing for purchase Factors affecting consumer behaviour We should analyze the uncontrollable and controllable factors affecting the Indian consumer behaviour, the uncontrollable factors are the sum of the macro environment analysis (PEST) but the controllable factors reflect the marketers efforts in purpose the 7 PS in a way that make the product convenient for the consumer so from the analysis of the target market done by chatterjee.Also there are other factors like motivation, life style, consumer learning and attitudes towards the product From the consumer analysis we can summarize that consumers in the target market need product of high quality, medium price (to be able to target a wider segments especially in the rural areas as they count 80% of the population and if they were successfully penetrated this will result in Brobdingnagian sales), ease of installation, endorsement is call for, the emphasis on the need of healthy life style and better water will be a actor for consumers to buy the product.For consumer analysis, we suggest that he should have used also the decision making process to know exactly what are the forces that affect the consumers buying behaviour Consumer buying decision process pic So according to this model we should analyze how consumers in India become aware of the water task and so the need for purifiers is recognized, then from where consumers get the information (from magazines, newspapers, reference groups) , then how they evaluate alternatives (based on price or quality or warranty or expertness ,,,,) . Then the purchase and post purchase valuation Competition analysisIt is very important for any strategic marketing plan to deeply analyze competition especially when it is done for new market entry S teps of Product /Market analysis 1. Identifying the generic wine need satisfied by the product categories (The need for improved water quality) 2. Identify the product categories (types / Classification) The need for water purifiers for household 3. Identify the particularised product-markets Water purifiers, cadmium filters 4. Identify the product-variants (brands) competing with each other. Chatterjee analyzed the competition in a detailed way, which can be summarized in the following The market sales chart in 1996 Product Price Strength ( free-enterprise(a) advantage) flunk Aquaguard RS 5500 Huge personal selling force Needs electrical energy Sales calls Enormous fixed be for sales efforts TV commercials (100-120 millions on sales commissions Magazines and newspapers advertising only) Advertising expenditures RS 1 million No storage capacity Slow flow rate Stop functioning at xcl volts Couldnt eliminate strong odours Puresip RS 2000 Water could be s tored safely for ulterior usage Promotional tools was limited as it was Doesnt need electricity sold only by undersize no of independent dealers nothing B RS 2000 +RS 200 3 stage purification process drop of onsumers cognizance (Puristore) yearly Prevent iodine deficiency diseases No heavy advertisement Water can be stored up to 8 hours No sales efforts No electricity or plumbing is needed Limited distribution Store 20 litters of water TV advertisements and point of sales brochures Marketing expenditure RS 3 millions Aquarius RS 4000 Remove sediments, heavy metals, bacteria, fungus kingdomLife of the device was listed as 40000 No electricity is needed but need water liters pressure Heavy advertising (TV, magazines, newspapers) Perfect architectural plan Superior distribution channels Knowledgeable personnel 3000 independent dealers Delta brand More eye pleasing anatomy Alfa Water RS 4300-RS 6500 purifies Spectr um RS 4000 Remove only suspended sediments not heavy metals or bacteria Water doctor RS 5200 Third stage ozonator to kill bacteria More attractive countertop 6-12 cubic decimetre Candle Filters (Bajaj ) The analysis shows that the market is Oligopolistic structure The product mapping technique Quality Puristore Puresip Aquaguard Weighted competitive strength assessmentWe should do the weighted competitive strength assessment in the analysis to be able to see the coition importance of key success factors and the relative strength of each competitor on each of these factors Key success factor Weight O T -Poor water quality in India as a result of infrastructure. - Competition in India market regarding water purifies. -Reinforcement of government officials and newspapers to improve water quality. Regarding Eureka Forbes -Life styles of Indians that value entertain and product quality choice. -Ineffectiveness of traditional systems in bact erial and viruses elimination. Huge sales force that passing motivated and well managed. -Liberalization and opened Indian economy to foreign investment. - wonderful brand honor. -Market in India requires more than one design. -skilled labor in India was around Rs. 20to Rs. 25 per hour less than if Regarding Ion Exchange. compared to that in USA. -The weak strategic component of Aqua guard -ZERO-B purifies marketing efforts will intensify to increase sentience -No filter or purifies in India market can remove iron contamination to a -New advertising program to increase awareness. satisfactory level. -No fellowship in India target rural areas. Regarding Singer. * lack of consumer awareness of the consumers of the ZERO-B *the hurrying philia class households prefer high price and high quality for -It was transcendent in comparison to other primitive products in the markets foreign brands in design and distribution channels TWOS ANALYSIS Past Huge success o f Blair keep attach to. -Product should be worked by -Brand name in USA. electricity Internal elements -Regarding water purifies attach to experts as superior in term of quality-Lack of sales office in India. and operation. *lack of sales force -High technology that qualified by WHO. Product name (Delight) not knowing - Design furcate from it might infringe on any being competitors brand in India. -Blair Company employee (4000 people with 380 having technical background) -They still faced major issues in -Strong financial position configuring technologies into physical *sales in the international division products. reach almost $ 140 million in 1996 * Deligth has a distinguish western External elements design *the option of use battery is available Strategic options -Poor water quality in India as a S-O* employ high technology that is W-O result of infrastructure. certified by WHO to satisfy the need *We can use the low cost skil ful -Reinforcement of government for clarified water in India labour in India to overcome the officials and newspapers to improve * employ the strong financial and shortage of sales force in India water quality. international division to build up an -Life styles of Indians that value opportunity in the liberalized Indian comfort and product quality choice. market -Ineffectiveness of traditional * utilise the high tec. to attack the methods in bacterial and viruses Aquaguard weak strategic components elimination. * exploitation the high quality products to -Liberalization and opened Indian satisfy the needs of the fastness optic economy to foreign investment. class -Market in India requires more than one design. -skilled labor in India was around Rs. 20to Rs. 5 per hour less than if compared to that in USA. -The weak strategic component of Aquaguard -No filter or purifies in India market can remove iron contamination to a satisfact ory level. -No company in India target rural areas. * lack of consumer awareness of the consumers of the ZERO-B *the upper middle class households prefer high price and high quality for foreign brands *to trade up the users of candle filters to a better safer product - Competition in India market S-T W-t regarding water purifies. *Using the high technology to compete *we must try to cope the product tec. with the other brands with India to be able to overcome the Regarding Eureka Forbes. *Using the western design to compete Indian market competition with competitors -Huge sales force that highly motivated and well managed. - Tremendous brand equity. Regarding Ion Exchange. -ZERO-B purifies marketing efforts will intensify to increase awareness -New advertising program to increase awareness. Regarding Singer. -It was superior in comparison to other rimitive products in the markets in design and distri bution channels Step three Setting objectives The main objective is to consolidate the Indian market and catch tremendous growth, as the situation in India is attractive for foreign investment and considered to be a window of opportunities The objective is smart as it is specific, measurable, achievable, realistic and time framed Step Four Setting StrategiesBased on the above situational analysis, we can now choose the strategies that will be used to achieve Blair Companys objectives According to Chatterjee, he identified two entry strategies Skimming strategy which means high price (RS 5900) and high quality Where the product design would be superior with higher performance and quality, longer warranty period, more features and more attractive appearance sagacity strategy which means low price (RS 4400) and lower quality Our suggestions firstly Porter Generic Strategies pic Using Porters Generic Strategies, since the competitive scope is broad and competitive advantage i s higher cost. We suggest using Differentiation strategy to enter the Indian market . y using the high technology strength of the Blair Company, the product must be high performance regarding to quality and western unique design. Second using Mckinsey matrix pic Since the competitive position of the firm is considered strong due to high technology and strong financial position and the market is attractive, we suggest adopting the Protect Position strategy where the company has to invest to grow at maximum digestible rate and concentrate efforts in maintaining strength From our strategic point of view Blairwater must enter the Indian market by skill (high investment) using the low cost Indian labour force and the liberalized investment ambiance in India. Third Ansoff Growth Strategy picAccording to Ansoff growth strategy matrix, Blair Water Purifier Company will adopt the Market Development strategy as the market is new but the product is the existing product. no matter that the p roduct must have some modifications regarding the Indian market, for example it may need extra purifying stage that the Indian water require, may be a whistle that tells the purifiers users that the unit is functioning probably, a small battery to operate the filters for several hours in slip of a power failure (a common occurrence in India and other LDCS) or even permitting users to add fluoride, vitamins or even flavourings to their water. Step Five STP ( sectionalization, Targeting and Positioning) pic 5-1 SegmentationPreviously we focused on approaches to environmental, customer and competitor analysis, and the frameworks within which strategic marketing planning can best take place. Against this background we now turn to the question of market variance, and to the ways in which companies need to position themselves in order to maximize their competitive advantage and serve their target markets in the most effective manner. In Blairs company case Chaterjee analyzed his target market to be the better educated, wealthier, and more health-conscious consumers who took travel to safeguard their familys health hand often continued these steps years around.By estimation Chatterjee thought it would be around 40 million, these consumers were similar in many respects to consumer in middle and upper class households in the US and European Union who valued comfort and product choice they saw consumption of material goods as a mean to a higher quality of life, they liked foreign brands and would pay a higher for such brands He reached the conclusion that his target market is these 40 million households plus those in another four million households who had similar values and lifestyles Chatterjee divided the target segments 40 million as follows *50 % from the target market boil water *10% from the 50% filter the boiling water *40% used a mechanical device in improving water divided to consumers who use candle filters and consumers who use water purifiers *10 % rema ining consumers who know nothing about the problem and if they know they dont want to pay on that point are three marketing distinct approaches to marketing strategy which exist such as 1 Undifferentiated or mass marketing Product-variety or differentiated marketing 3 Target or saturated marketing These are well illustrated in Figure Marketing segmentation Dividing the total market into different units, the units are heterogynous with each other We see that chatterjee divided the market using the following 4 segmentation factors into 4 segments He used the demographics (age) , social class (to show the buying power ,income and education ),Family size (to show the demand volume ) ,geographic (between rural and urban ) and volume of usage 5-2 Targeting Choosing one or more segment Chatterjee chooses segment 1,2 and 3 and ignored segment 4 5-3 PositioningPositioning is firm according to the price strategies that Chatterjee mentioned whether if it sliver or penetration, product desig n for the skimming strategy would be noticeably superior with higher performance and quality longer warranty period, more features and more attractive appearance than the design of the penetration There are several positioning possibilities performance and taste, value for the money/low price, safety, health, convenience, attractive styling, reduceing diseases and health related bills and superior American technology. The only position he considered taken in the market was that assiduous by Aquaguard protect family health and service at your doorstep.According to the specialism entry that we selected, the positioning should be Superior American technology and design, performance and taste. Due to the three segments that we mentioned above, Chatterjee must design three different marketing mix as shown below Model of smaller capacity for segment 1, model for larger capacity for larger houses for segment 2 and 2 models for segment 3 that would remove iron, calcium and other metallic containments that were fantastic to particular regions, for example Calcutta. Question 2 The 3 ways to enter the Market Joint working arrangement Joint venture company Acquisition Main three Factors while selecting the best entry method Litigation Problems could extend a case for easily a extension Foreign companies were taxed on Income arising from Indian operations The foreign company should pay taxes on also any interest, dividends, and royalties received and on any with child(p) gains received from a sale of assets. Licensing Consideration Chatterjee abbreviation Blair Company pecuniary Position will be minimal Expenses 30,000 in capital for employment facilities and equipment , another $ 5,000 for office facilities Annual fixed cost should not exceeds $ 40,000 these investments would be offset by the Licensees payment to Blair company for technology transfer and personnel training Decrease of annual fixed costs to $ 15000 once Indian national are hired, trained and left in supercharged Duties of the Indian Labor will include seeing how the units are produced in USA with Blair company specification. The licensee would pay to Blair company around 280 R. S for each unit solid in the domestic market and 450 R. S for exported units, so the average will be around 300 R. S Licensing Analysis draft Indian company would manufacture and market the product. Licensee fees would be remitted to Blair company per unit basis over the term of the agreement Licensing rendering A contractual agreement whereby a multinational marketer (the licensor) makes available nonphysical assets such as patents, trade secre ts, know-how, trademarks, and company name- to foreign companies in return for royalties or other form of payments Licensing Pros and Cons Pros Quick and easy way to enter the market. Could be the only way to open the market. Provides life extension for products in the maturity stage of their life cycles. Is a good alternative for foreign end products and marketing? Royalties are guaranteed and periodic. Licensing can overcome high transportation costs which make some exports noncompetitive in export market. Licensing is immune to expropriation. Cons No full control over output signal and marketing. Royalties are negligible compared with equity investment potential. There is a danger of creating competition in ternion country, or even home country markets if the licensee violates territorial agreement. Joint feign/ Acquisition Chatterjee Analysis Financial investment and annual fixed costs would be higher and depnd on the scope of operations. Estimates of annual fixed expenses via acquisition would be same for joint venture Estimates for the investment might be considered higher/lower depend on what will be purchased. trust where made on the skimming, penetration pricing strategies Joint Venture Brief Blair company will be a partner with an existing Indian company specially for manufacturing and market ing the product Profits will break down between the two companies according to their agreement Acquisition Brief Blair company will purchase an existing Indian company Profits will belong to Blair company Join Venture DefinitionA long term partnership between two or more companies manduction equity and take a chance with the purpose of making profits in a target market. Pros Potential for higher profits. More control over production and marketing. Better market feedback. More experience in international marketing. Cons owing(p) investment of capital. Higher level of risk. Potential conflicts between partners. Acquisition Definition Ownership by the international firm in foreign markets Pros maximum profits. Full control over production and marketing. Better market feedback. colossal experience in international marketing Integration of operations on a worldwide basis. Cons High capital and management resources requirements. Higher risk of expropriation Why Acqui sition is the better entry way for Blair Company Based on all the mentioned analysis we have found that the Acquisition will be the best entry way due to all the acquisition pros the maximum profits, the full control and the better market feedback. In addition it will avoid the Licensing problems example no control over production and marketing as the Indian labor will know how the units are produced and their specifications as they must be trained in order to contract the cost as the Indian Labor cost is less than the American Labor cost. Therefore, this is considered a negative pointAs for the joint venture it is not considered a good entry way as in India the Litigation Problems could extend a case for easily a coevals in addition to the higher level of risks and the potential conflicts between partners. WEAKNESSES Areas of relative disadvantage that Indicate priorities for marketing improvement Highlight the areas and strategies that the planner should avoid OPPORTUNITIES En vironmental trends with positive outcomes that offer scope for higher Levels of performance if pursue effectively Highlight new areas for competitive advantage THREATS Trends within the environment with potentially negative impacts that Increase the risks of a strategy Hinder the carrying into action of strategy Increase the resources requiredReduce performance expectations STRENGTHS Areas of (distinctive) competence that must always be looked at relative to the competition If managed properly, is the basis for competitive advantage Derive from the marketing asset base S3 Adults 25-45 Social class A, B High income Healthy life style Regions with iron contaminants S4 Adults 25-45 unpolished areas Social class c Low income Low infrastructure S2 Adults 25-45 Social class A, B High income Healthy life style pear-shaped family size Big houses High volume usage S1 Adults 25-45 Social class A, B High income Healthy life style Small family size Flats residence Low volume usags1e Projec t content pic Submitted to Dr Usama Saleh