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Griffith University

24/03/16

Gold Coast Campus

SITUATIONAL
ANALYSIS
EXELPET FLEA TREATMENT
1003MKT Introduction to Marketing __
Semester 1 JESSICA REGTIEN

Jessica Regtien

Tutor:

Amy Gold

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University

Griffith

Image 1

Situational Analysis

Jessica Regtien

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INTRODUCTION AND COMPANY BACKGROUND


INTRODUCTION
Exelpet s current marketing direction combined with
poor public perception of a series of recent production
errors, has led to a long term structural decline of sales
and overall brand value. Repositioning the current
brand is critical for Exelpet as it continues to fend of
new and established competitors, along with new
entrants in a growing and dynamic market sector,
whilst improving annual turnover and profit from sales.
By conducting an intensive analysis of the pet care
sector, a new and vibrant strategy can be established
to rebrand Exelpet Vet Series Flea Treatment For
Cats as a leading pet care product but also
boost Exelpet as a brand and its presence within the
industry.

Product:
Exelpet Vet
Series Flea
Treatment For
COMPANY BACKGROUND
Cats
[Image 2]
Mars entered the Australian market in 1954, selling their famous Mars chocolate
bar.. Sixty-two years later, the company has grown dramatically, now employing over
2,000 workers over 6 production sites around Australia, with an annual turnover of
AUD$1 billion. While best known for its iconic chocolate bar, Mars have extended
their product range and their distribution to now reach to export to more than 30
countries. Branded products included pet products (WHISKAS, PAL),
confectionary brands (ECLIPSE, SNICKERS) to everyday kitchen staples such as,
(MASTERFOODS and DOLMIO).
In 1972 Mars Australia introduced Exelpet , a pet care brand focusing on parasite
prevention and solutions. A high profile local presence provided the company with a
key advantage within the rapidly growing domestic market, which coupled with
aggressive marketing; created a well-established and trusted brand with Australian
consumers.
With the Australian economy deregulating in the 1980s and 1990s, market growth
accelerated creating a dynamic market pull for new competitors, who introduced a
wider range of pet care products. More recently, the past decade has seen a higher
presence of pet based marketing campaigns, promoting products that are
purportedly more cost efective and with greater efficacy; the end results being a
decline in Exelpet s sales. Similarly, sales for Mars Australias other products have
stagnated, suggesting a wider brand repositioning may be required in order for the

SITUATIONAL ANALYSIS

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company to regain its growth and profitability in todays competitive market and
economy.

SITUATIONAL ANALYSIS
MARKET ANALYSIS
With more than 60% of households, owning at least one pet, Australia has the
highest rate of pet ownership in the world (Richardson, 2016). Pets are now
becoming important part of Australian families, and are even being colloquially
referred to as fur babies.
As can be observed in Table 1 (highlighted) pet products/food/care is a booming
industry, with an annual revenue of $4.3 billion and profits of $292.4 million in
Australia alone. (Richardson, 2016) The growth in pet ownership and pet care may in
part be due to human centric health and wellness trends that have spilled over to
Australias increasingly pampered pet population with owners taking a more holistic
approach to the health of wellbeing of their pets. (Richardson, 2016)

Table 1, Appendix 1.

Animal health care accounts for 19.6% of annual revenue (Richardson, 2016) for
pet products sales in Australia, which explains the recent trend of flea treatment
sales from 2010-2015, maintaining a high 77% average of sales in the Pet Care
sector. As pets are becoming humanised and are more valued as an essential part of

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families, the level of discretionary spending for many households are fuelling the
market.
The attribution of human characteristics to pets or anthropomorphism are
influencing lifestyle choices for households, as large numbers of pets are now being
kept indoors. This means that despite urbanisation trends, there has been an
increase in the number of small dogs and cats kept as pets. (Richardson, 2016)

PRODUCT LIFE CYCLE


The following presents a brief outline of Exelpet s sales over a 5 year period.
Sales of Exelpet were highest upon its release in 2010 but declined by around 25%
over the following 2 years. Between 2012-2013 Mar s managed to stabilize revenue
for Exelpet , but subsequently sufered a further 16% loss in sales in 2014. In
summary, over a 5-year period, Exelpet has lost approx. 37% in product sales and
slipped from 2nd to 3rd in market share. This dramatic loss has driven the companys
management team to urgently assess the possibility of repositioning the brand and

product.
Appendix 2, Data Sourced from: Euromonitor Internationals data (Company Sales,
2014)

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As can be seen (right) the major


competitor is Sanofi , who produce
a brand called Frontline.
Sanofi has remained the industry
leader despite a 10% decline in sales
from 2010-2014. All leading brands,
with the exception of Nestle, have
experienced a decline in sales
suggesting new competitors has
eroded market share.

Table 2, Appendix 3.

Appendix 4, Data Sourced from: Euromonitor Internationals data (Company Sales,


2014)
In 2010-2012 Exelpet made several significant production errors recently regarding
the concentration of pyrethrins (a powerful insecticide) in one of their products.
Following a series of customer complaints, Exelpet was caught in the media firing

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line of the media with reports of side efects such as foaming at the mouth seconds
after applying Exelpet (2015, Herald Sun, Chris Chambel).
Exelpet released a series of statements claiming that the products were extensively
tested before they are released to market to ensure compliance with national
standards, and that pyrethrin had been used as a safe and efective insecticide for
over 100 years. (2015, F. Chung). These counterclaims did not however, help sales
to recover. A contributing factor to the inexorable decline in Exelpet s sales may be
due in part to lingering adverse media reports on the internet and various pet owner
forums, in essence branding the product as harmful and toxic. This negative image
can afect customers decision on purchasing an Exelpet product and this will
continue to be the case without a positive campaign towards repositioning the brand
profile.
In repositioning Exelpet Vet Series Flea Treatment For Cats, it will promote this
particular treatment to an ever-increasing market, where this treatment is required
and where consumers are prepared to spend increasingly higher prices, to pamper
and take care of their pets. This will not only boost Exelpet s sales and profit
margin, but will allow Mars as a company to regain lost traction in brand shares and
total brand/product sales.

ENVIRONMENTAL ANALYSIS
The macro environment is the wide outlook on the economy and focuses on
uncontrollable trends. The factors that are apart of the macro environment include
the political, economic, sociocultural, technological, legal and environmental. Not
only can they afect performance of sales, but sway marketing strategies and
decision making.
These key factors will have an important efect on Exelpet and also on the
decisions around the repositioning of the product, as they can have both positive and
negative repercussions.

PESTLE ANALYSIS

SITUATIONAL ANALYSIS

Situational Analysis

POLITICAL

ECONOMIC

SOCIOCULTURAL

TECHNOLOGICA
L

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- animal welfare legislation at local, state and even


federal level

- higher import costs therefore include only australian


ingredients/products
- having a 100% Australian brand is attractive,
promote australia made for australian consumers

- furbabies phenomenon
- human fertility rates are declining, yet people are
living longer
- baby boomer's are seeking copanionship and
replacing mobile/remote children/granchildren with pets

- advertising (social media, tv, radio)


- online marketing strategies
- link good science to pet care product efficacy

LEGAL

- legal resposiblity that the pets using the treatments


won't experience negative efects
- product guarntee that the treatment actually works
- company is legally responsible to demonstrate that its
safe for humans as well

ENVIRONMENT
AL

- safe, non toxic for the environment


-seasonal factors will influence the sales of flea
treatments
-Some areas of australia have long flea seasons due to
warmer conditions creating higher demand for flea
treatments

COMPETITOR ANALYSIS
It is vital to accurately assess Exelpets market position in this dynamic and rapidly
shifting market. A realistic assessment of its recent sales performance, the products
relationship with the companys key customer base and how both long term and new
competitors are performing, will dictate decision making for any future marketing to
reposition Exelpet.
Exelpet is one of the leading brands in the pet care industry, with its key competitors
producing similar products in a highly oligopolistic environment, utilizing aggressive
promotional campaigning and low prices. Intense competition combined with some

SITUATIONAL ANALYSIS

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poor media coverage from 2010-2012, has resulted in a decline in Exelpets sales
and prompted the need for brand repositioning.

TOP COMPETITORS:
1.
2.
3.
4.

FrontLine
Advantage
PetArmor
Revolution

COMPETITIVE MARKET SUMMARY


Competitor

FrontLin
e
http://www.frontli
ne.com/Pages/de
fault.aspx

Advantag
e

http://advantage
petcare.com.au

PetArmor
http://www.petar

Target
Market
Brand covers
pets:
Kittens to
Large Cats
and
Puppies to
Large Dogs

Brand covers
pets:
Kittens and
Small cats up
to 4kg, Cats
over 4kg,
Dogs and
puppies up to
4kgs, Dogs 410kgs, Dogs
10-25kgs, and
Dogs over
25kgs

Brand covers
pets:
Dogs and Cats

mor.com

However
PetArmor also
has a large
range of other
flea and tick
treatments,
allergy relief,
de wormers
etc.

Product

Price

Promotiona
l

Frontline Plus
Green For
Cats
Topical,
Monthly
Dosage
Treats: Fleas,
eggs

$49.99
for 3x
0.5ml
Pipettes
(3 uses)
High
price.

powerful
flea and tick
prevention
recommend
ed by
Veterinarian
s.

Advantage
Flea Treatment
for Cats
Topical (spoton), Monthly
Dosage
Treats: Adult
Fleas, flea
larvae

$55.99
For 6x
0.5ml
pipettes
(6 uses)
Low
price.

dont give
fleas a biting
chance.

Manufacturer
= Retailer =
Consumer.

Large
presence on
social media
and TV
commercials
.

Can buy
online,
straight from
website.
Suggests and
promotes
these
distribution
outlets;
-VetShop
Australia
-Budget Pet
Products
-Pet Circle
-Pet Stock
-The Vet Shed

PetArmor Plus
For Cats
Topical
application, 12
week dosage

$29.99
(Australia
n dollars)
for 3x
0.5ml
pipettes

get lasting
control with
PetArmor

Manufacturer
=
Retailer =
Consumer.
American
stores (Target,
Costco)
Online
(Amazon, Jet)

Television
commercials

(3 uses)
Low
price,
however
if bought
online
there

Advertises
largely
through TV
commercials
.

Distribution
Manufacturer
= Retailer =
Consumer.
Vets, Pet
stores,
Supermarkets
And also large
retailers
(Target,
Kmart)

Strength

Weakn

Well known brand


and Parent
company (Sanofi,
that specialise in
pharmaceuticals,
and health care)

Highly p
Relies m
on curre
followin
and has
current
advertis
circling
market.

Brand has a large


range of diferent
products, caters
for a wider
demographic and
for families with
more than one
pet.
Australian branch.
Parent company:
Bayer
Lowest price on
market (for the
amount of doses
in a box)
Largest range of
Flea products in
the Market

Excessi
number
product
from on
brand
specific
(advant
can con
and
overwh
custom
with the
amount
choice.

Longer lasting
efective than
competitors (up to
12 weeks)

Not an
Australi
based
compan
product
would b
higher t
compet
as impo
cots are
skyrock

PetArmor has the


biggest range of
pet health care, in
the market. The
amount and
diversity of the
products gives
consumers a go to
brand for all pet
care related

SITUATIONAL ANALYSIS

Only co
in one
dosage

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may be
shipping
costs.

Revolutio
n
https://www.revol
ution.com.au/Def
ault.aspx

Brand covers
pets:

Revolution For
Cats

Cats 2.67.5kgs and


Dogs 2.6-5kg,
Dogs 5-10kg,
Dogs 10-20kg
and Dogs 2040kgs.

Topical
applications,
monthly
dosage

$60-75
(dependi
ng on
retailer)
for 6x
0.75ml
pipettes
(6 uses)
Very
highly
priced.

essential
vet-grade
protection

Manufacturer
= Retailer =
Consumer.

Television
commercials
and ad
campaigns.

Direct brand
website gives
customer a
map to find a
local vet clinic
or pet store to
buy
Revolution.
They also give
consumers
the option to
buy direct
from these pet
stores:
-vet-n-pet
Direct
-Budget Pet
Products
-Pet Circle
-Stefmar
-Lucky Pet

needs. Making
customer loyalty
and consistency
and major
strength.

doesnt
consum
options

Australian brand
and made in
Australia.
Large following
and positive
reviews on entire
brand.

The hig
price m
discour
consum
to buy
another
brand.
Treatme
only las
month.
Compet
options
longer a
are mor
cost
efectiv
dose.

Flea treatment
and prevention
plan provided on
website and with
the purchase of a
product.
This gives a
personal touch
and guidance to
purchasing a
product from
Revolution.

COMPANY ANALYSIS
Looking over the SWOT analysis it is obvious that the company is a
leading competitor and with its market history and significant revenue

SITUATIONAL ANALYSIS

Situational Analysis

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base, Mars Australia is ideally placed to realign the Exelpet


develop a dynamic repositioning strategy.

and

Ultimately brand repositioning will allow the company to keep up with the
growth of the market, the new low pricing regime and promotional tactics,
and in turn to also expand and attract a new customer base.
SWOT ANALYSIS
INTERNAL ENVIRONMENT
STRENGTHS
WEAKNESSES
Long history iconic brand
Recycling bad press poor results in
2012 can still afect a customers
Large revenue base
decision to choose Exelpet through
Established network for distribution
internet and media longevity
Scientific research links

Large companies often move slow to


Products are non-discretionary
make changes (repositioning) time
Ability to gain source celebrity
poor
endorsement
EXTERNAL ENVIRONMENT
OPPORTUNITIES
THREATS
Rapidly growing pet care sector
Importers taking market share
(cheaper for supermarkets and
Explosion in pet ownership
consumers to buy products made
Pain of pet illness versus pleasure of
overseas etc.)
healthy pet (product brings a
Large number of competitors and
solution)
product choice confuses customers
Anthropomorphic trends
Increase cost of marketing to raise
product above noise of
competitors

REFERENCES

Euromonitor International 2016:

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Brand Shares. (2016). Portal.euromonitor.com.libraryproxy.griffith.edu.au.


Retrieved March 2016, from
http://www.portal.euromonitor.com.libraryproxy.griffith.edu.au/portal/analy
sis/related
Sales of Pet Products. (2016).
Portal.euromonitor.com.libraryproxy.griffith.edu.au. Retrieved March 2016,
from
http://www.portal.euromonitor.com.libraryproxy.griffith.edu.au/portal/statis
tics/changemeasure
IBISWorld Industry Reports: Statistics
Pets and Pet Supplies Retailers in Australia Market Research | IBISWorld.
(2016). Ibisworld.com.au. Retrieved March 2016, from
http://www.ibisworld.com.au/industry/pets-and-pet-supplies-retailers.html
Richardson, A. (2016). Pets and Pet Supplies Retailers In Australia (pp.
3,4,5,6,22,23). IBISWorld.
Pet Brands:
Mars Australia and New Zealand - Pedigree, Whiskas, Greenies,
Nutro, Royal Canin and More. (2016). mars.com. Retrieved March
2016, from
http://www.mars.com/australia/en/brands/petcare.aspx
Flea Treatment for Cats | EXELPET. (2016). Exelpet.com.au. Retrieved
March 2016, from
http://www.exelpet.com.au/products/cats/flea-treatment/
Flea & Tick Protection for Cats & Dogs | FRONTLINE Plus. (2016).
Frontline.com. Retrieved March 2016, from
http://www.frontline.com/Pages/About.aspx

Advantage Petcare. (2016). Advantagepetcare.com.au. Retrieved March


2016, from http://advantagepetcare.com.au
Pet Care Products | Flea & Tick Medication | PetArmor. (2016). PetArmor.
Retrieved March 2016, from http://www.petarmor.com
Revolution | vet-grade protection | Home. (2016). Revolution.com.au.
Retrieved March 2016, from https://www.revolution.com.au/Default.aspx

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Chung, F. (2015). Coles and Woolworths under fire for selling toxic flea
spray for pets. Herald Sun. Retrieved from
http://www.heraldsun.com.au/business/companies/coles-and-woolworthsunder-fire-for-selling-toxic-flea-spray-for-pets/newsstory/303a9f71b968ea487b8f2a35088f241c?=

Appendix:
Image 1: (2016). Retrieved from https://www.petbasics.com
Image 2: (2016). Retrieved from http://exelpet.com.au/products/dogs/fleatreatment/
Table 1, Appendix 1: (2016). Retrieved from
http://www.portal.euromonitor.com.libraryproxy.griffith.edu.au/portal/statis
tics/changemeasure
Appendix 2: (2016) Retrieved from
http://www.portal.euromonitor.com.libraryproxy.griffith.edu.au/portal/statis
tics/changemeasure
Table 2, Appendix 3: (2016) Retrieved from
http://www.portal.euromonitor.com.libraryproxy.griffith.edu.au/portal/statis
tics/changemeasure
Appendix 4:
http://www.portal.euromonitor.com.libraryproxy.griffith.edu.au/portal/statis
tics/changemeasure

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