Cover page

Table of contents
Introduction of product ................................................................................................................................ 3
Proposed target market ................................................................................................................................ 4
Basis for segmentation .................................................................................. Error! Bookmark not defined.
Geographic Segmentation ........................................................................................................................ 5
Income Groups .......................................................................................................................................... 5
Demographic Segmentation ..................................................................................................................... 5
Psychographic Segmentation.................................................................................................................... 6
Behavioral Segmentation .......................................................................................................................... 6
Product strategy for the new market ........................................................................................................... 7
Game Theory Concept of Dalda ................................................................................................................ 7
Marketing Strategies ..................................................................................................................................... 7
Total Market Strategy ............................................................................................................................... 7
Early Entry Strategy................................................................................................................................... 7
Strong Commitment ................................................................................................................................. 8
Market Dilution Strategy........................................................................................................................... 8
Product Strategies......................................................................................................................................... 8
Product improvement strategies .............................................................................................................. 8
Product imitation strategy ........................................................................................................................ 9
Quality strategy ......................................................................................................................................... 9
Customer service strategy ........................................................................................................................ 9
Pricing strategy ............................................................................................................................................. 9
Establishing the product’s price strategy.................................................................................................. 9
Product-Line Pricing Strategy.................................................................................................................. 10
Place/distribution strategy ......................................................................................................................... 10
Single Channel Strategy .......................................................................................................................... 10
Distribution Rights .................................................................................................................................. 11
Way of promotion ................................................................................................................................... 11
Competition ............................................................................................................................................ 11
Communication strategy............................................................................................................................. 12
Line Modernization ................................................................................................................................. 12
Preferences ................................................................................................................................................. 13
Reference list .............................................................................................................................................. 14
Introduction of product

Dalda is a brand of hydrogenated vegetable oil popular in South Asia. The substance was originally

imported from the Netherlands in the 1930s by the trading company Dada Limited. When

Hindustan Lever Limited wanted to brand it, the trader, who still retained a commercial connection

with the product, said it had to be named after his company (Rahman, 2016). HLL wanted to

include the letter 'L' in it for Lever (of the Unilever group), and thus was born one of the longest-

living brands in India. Dalda, which came to be synonymous with the Banaspati (hydrogenated

vegetable fat) genre, was recently extended to a range of edible oils. Hindustan Lever has since

sold the brand. In July 2004, Unilever Pakistan accepted the offer of Rs. 1.33 million for the sale

of its "Dalda" brand to Westbury Group in collaboration with Unilever Employee Welfare Group,

who formed a separated company under Dalda Foods (Private) Ltd. Dalda has now divested into

Canola and Olive Oil product variants. Today, Dalda Foods (Pvt.) Limited deals in Banaspati and

cooking oils, Ghee (Banaspati) and claim to use Virtually Trans Fat (VTF) free technology. With

total annual sales volume exceeding USD 10 Million, Dalda is one of the leading brands available

in Pakistan for over 60 years. Dalda is the largest FMCG Company exclusively in the vegetable

oil & fats sector in Pakistan. The company produces premium brand cooking oils and

Hydrogenated cooking mediums, and markets the products through its own distribution network,

which covers almost all commercially viable markets nationwide (Hassan et al., 2016). The

company has strong financial background and has sizable infrastructure managed by professional

staff. It has proven track record in this business and has plans for targeted prosperous growth in

future. The marketing policy of the company envisages development of brand loyalties among the
customers and consumers through their continued involvement and participation in series of

several promotional activities run by professional staffs and consultants. The monthly national

cookery contest being the most popular marketing activity of the company which brings valuable

prizes to the winning recipes every month started 10 years ago and has celebrated its 120th diamond

jubilee contest in Feb. 1999 (Samiee et al., 2019).

Proposed target market

Market segmentation at the level of “segment marketing” will be practiced for Dalda in order to

increase targeting precision (Morgan et al., 2019). It is recognized that buyers differ in their wants,

purchasing power, geographic locations, buying attitudes, and buying habits. However, it is not

possible to customize the offer/communication bundle to each individual customer. Therefore,

Dalda will try to isolate some broad segments that make up the market for different items on its

product line. For example, health conscious consumers for Dalda cooking oil with vitamin E.

Similarly, modern working women looking for convenience for the Dalda flavored oil market (this

is a line extension we have proposed in this report and will be discussed later in greater detail)

(Rao et al., 2015). Dalda focuses on all types of market that is why they offer different packages

for different markets. The company has introduced recently a new product in the market named

Handi (oil). The reason for introducing this product is cater the needs of the lower income group.
Geographic Segmentation

Dalda divides the country in to two major regions i.e. north and south. North region includes

two provinces Punjab and N.W.F.P and south region includes Sindh and Baluchistan (Menon et

al., 2015). With the help of the segmentation they came to know the demand of the oil and ghee.

They have more demand of Ghee in the northern region and oil in southern region (Berger, 2019).

Income Groups

The other basis of segmentation is income groups, for example they have introduced pet bottle for

high-income group as well as Handy (oil) for low-income group. They have also introduced

different sizes of the products from one-liter pouch to ten liters tin pack. This product range carries

the needs of all income groups.

Demographic Segmentation

 The target audience will be primarily females starting from the age of 20 to round about 45

years of age.

 For Dalda banaspati and cooking oil the income strata would be Rs. 4000/- plus. However, the

new flavored oils would be targeted at the upper strata of Rs. 10,000/- plus. As the loose

oil/banaspati consuming segment comprises around 50% of the market, therefore, Dalda junior

would continue targeting this segment.

Psychographic Segmentation

 The entire product range would be targeted at females leading a trendy and modern lifestyle.

Flavored oils would especially be marketed to working women looking for convenient and

smart recipes.

Behavioral Segmentation

 We will try to increase the occasions of oil and banaspati consumption. Soon after Moharrum

the marriage season will begin. This will be a good opportunity to cash on the seasonality

effect.

 Through the introduction of flavored oils, we will be inducing new usage patterns. Following

are the extra uses for this category:

1. Can be used for grill basting.

2. Can be used in salad dressings, dips, mayonnaise, etc.

3. Can be used as a drizzle in presentations.

4. Can be used in soups and stews.

5. Can be used for shallow, griddle and deep-frying.

6. Can be used for sauntering vegetables, sea foods and meats.

7. Can be used for brushing pizza dough

8. Can be used for adding lemon flavor to curry.

9. Can be used for marinating meat.

Product strategy for the new market

Game Theory Concept of Dalda

According to the Game Theory Concept Dalda always have a check on its major competitor Dalda

regarding its promotional and pricing strategies for example, when for the month of ramzan Dalda

reduced its prices by Rs.10, Dalda also responded and reduced its prices by Rs.15.

Marketing Strategies

Total Market Strategy

To serve the market Dalda follows Total Market Strategy and serves an entire spectrum of the

market by selling different sizes of the product to different segments (Mohiuddin, 2019). The proof

is that the company has five oil products in the market and every product has minimum three sizes.

Early Entry Strategy

Dalda was the early entrants in the edible oil market. It entered in the market in1975; the other

early entrants were GCP and Kohinoor (Naz et al., 2018). The first company to enter in this market

was Dalda, which is to complete its 50 years of serving the market. Due to the first to enter in the

market Dalda enjoyed high profits with a production of 150,000 tons and due to the entrance of

other companies the production is now reduced to only 60,000 tons.

Strong Commitment

Dalda is doing its business in a good manner and it has a very strong commitment with the market

and its other business operations. If the company loses its commitment than it will also lose its

market share that is why Dalda gives trade discounts to its dealers and focuses on every step of the

competitors.

Market Dilution Strategy

The company sometimes uses the pruning strategy when it is not getting the desired results from

its products. In the past the company had used this strategy many times, once it was used for Nayab

Banspati, which was not very successful product that is why it was eliminated in the market. The

other products that were eliminated are American corn oil and Dalda Punch pack.

Product Strategies

Company has standardized products but these products are available in different sizes for the

convenience of its customers, such as 1 liter, 2.5liters, 5 liters, and 10 liters.

Product improvement strategies

Company also follows this strategy and introduces improvement with the passage of time, such as

different flavors, new grate taste and vitamin A, E & D.

Product imitation strategy

Company sometimes follow other companies and does not take initiative, such as Dalda introduced

corn oil after introducing this product by other companies.

Quality strategy

Company’s basic philosophy is to provide quality products to its customers and the evidence is the

ISO 9002 certification.

Customer service strategy

Company never ignores its customer and always gives importance and value to them. Company

has its own in house research department, which gathers information related to the customer’s

preferences and sometimes the company also hires the services of other research firms such as,

Aftab Associates. Dalda also provides door-to-door service occasionally and use to give free

samples.

Pricing strategy

Establishing the product’s price strategy

Company always tries to maintain its product’s prices but sometimes gives discounts in response

to the different moves of its competitors and also to attract more customers. Most of the times
company makes changes in terms of discounts and does not change its tag prices. In other words

we can say that the company has a flexible pricing strategy.

Product-Line Pricing Strategy

Dalda focuses on its customers while setting the prices of its product line. When company

introduced its pouch pack in the market it followed the market penetration strategy and set low

prices according to its target markets. On the other hand when the company introduced the Soya

Bean Oil in pet bottles it followed market skimming strategy and set high price with high

promotion according to the targeted customers.

Place/distribution strategy

Single Channel Strategy

For distribution purposes Dalda uses single channel strategy. The process of distribution consists

of different steps, such as factory to warehouse, warehouse to distributors, distributors to retailers,

and finally the product reaches to the final consumer through retailers. So we can say the products

of the Dalda reach to its ultimate customers through single channel (retailer). At the present time

there are nine distributors in Lahore, which covers 5000 shops (Zafar et al., 2019).
Distribution Rights

As such there is no formal procedure for giving the distribution rights. What Dalda require is a

good reputation and strong financial position. Dalda asks for an advance payment for the ordered

goods from the distributors.

Way of promotion

Dalda actively participate in all the promotional activities. The annual cost of the promotion is

Rs.50 million, right about it also arranges different cookery competition in different women

colleges for promotion purposes. Dalda also arranges sports week in different women colleges.

Competition

Basically the branded market of edible oil and banaspati is dominated by four players namely;

Habib, Tullo and Soya Supreme. There are approximately 172 registered banaspati brands. Besides

there is a very large unquantifiable unbranded market selling banaspati, unrefined soybean,

rapeseed and cottonseed oil loosely to the rural and lower income consumers. Therefore it becomes

highly difficult to estimate the market size. In the banaspati market, Dalda VTF is a sure shot

market leader. However, it is a market challenger in the cooking oil category lending the first place

to Habib cooking oil. If Planta is considered along with Dalda then Lever Brothers Pakistan

Limited (LBPL) accounts for the highest sales volume. Consumers all over the country have great

trust in the brand name of Dalda, which is considered to be a very traditional brand. The brand

awareness and recall is 97% (Mathur, 2016). It enjoys hard core loyalty in the 35+ (female) age

bracket. However, Dalda is weak in the younger segment, here it suffers at the hands of boredom.
In this younger segment Tullo gold and Habib are the “in” brands because their packaging is trendy

and the attire which they portray in their promotional campaigns is very young and energetic.

Another problem is that Unilever International dictates the ingredients and the quality control

terms for the entire product range of Dalda. This increases the final selling price, making it a

premium product. LBPL has no leverage to come up with cheap ingredient brands. Therefore, they

lose out to competitors like Habib who has Habib Nayab and Habib Handi catering to the lower

income segment.

Communication strategy

1. Teaser: A 7- second TV commercial would be aired for one month (June).

40 spots would be aired two to three times a day, in the time slot of 6:45 p.m. to 7:45 p.m.

Research has indicated that this time slot gives the highest reach of the target audience. The

total cost of this campaign would come up to Rs. 2.1 million.

2. Dalda Ka Dastarkhan: The total cost of thirteen episodes on TV and a quarter year running on

FM 100 would cost Rs. 15 million.

3. Print And Billboard: Total costing would sum up to Rs. 14-16 million.

4. Scholarship: Ten scholarships starting next year would cumulate a total of Rs. 1.5 million.

Line Modernization

As per Mathur, (2016) even when the product line length is adequate, the line might need to be

modernized. The issue is whether to overhaul the line, piecemeal or all at once. A piece meal
approach allows the company to see how customers and dealers take to the new style. It is also

less draining on the company’s cash cow. This is the reason why we have planned a piecemeal

approach for repositioning Dalda. In this, we would be continuing the marketing of Dalda (VTF)

banaspati, Dalda cooking oil and will stop manufacturing and selling Dalda Lajawab and Crisp n

Dry. In rapidly changing product markets, product modernization is carried on continuously.

Companies plan product improvements to encourage customer migration to higher valued, higher

priced items. LBPL will try to do a similar thing with Dalda through the introduction of flavored

oils. This will be a line extension catering to the needs of women between the ages of 20 and 45

and belonging to the upper income strata of Rs. 10,000/- plus (Rahman, 2016).

Preferences

Research indicates that the edible oil and banaspati market has distinct preference clusters, the

natural market segments. Some consumers look for pure banaspati with a rich taste and smell,

there is simply no way that they want to give up on the typical, cultural taste of their food. Along

with them are consumers who are very health conscious and are not ready to compromise their

healthy diet patterns under any circumstances whatsoever. Then there are nuclear families with

working mothers who are trying to build trendy and convenient eating habits. Thus, the best

solution for Dalda is to have a separate product positioned in each different segment. Dalda

banaspati for the first set of consumers, Dalda cooking oil with vitamin E for the second and Dalda

flavored oil for the working mothers.

Reference list

Berger, R., 2019. Clarified Commodities: Managing Ghee in Interwar India. Technology and

culture, 60(4), pp.1004-1026.

Crawley, E., Cameron, B. and Selva, D., 2015. System architecture: strategy and product

development for complex systems. Prentice Hall Press.

Hassan, E., Haier, A. and Khawaja, H., 2016. Launching of" Deosai" in the Retail Market of

Islamabad: Designing and executing its Marketing Mix (Doctoral dissertation, Bahria

University Islamabad Campus).

Hult, G.T.M. and Ketchen, D.J., 2017. Disruptive marketing strategy. AMS Review, 7(1-2), pp.20

25.

Mathur, A.N., 2016. IIMA-Strategies for Future: Understanding International Business. Random

House India.

Menon, A., Bharadwaj, S.G., Adidam, P.T. and Edison, S.W., 2015. Effective Marketing Strategy

Making: Antecedents and Consequences. In Proceedings of the 1997 Academy of

Marketing Science (AMS) Annual Conference (pp. 224-224). Springer, Cham.

Mohiuddin, A.K., 2019. The Mysterious Domination of Food Contaminants and Adulterants in

Bangladesh. Journal of Environmental Science and Public Health, 3(1), pp.34-56.

Morgan, N.A., Whitler, K.A., Feng, H. and Chari, S., 2019. Research in marketing

strategy. Journal of the Academy of Marketing Science, 47(1), pp.4-29.

Naz, L., Ahmad, M. and Arif, G.M., 2018. Estimating Food Demand System and Rural Household

Welfare: A Case study from Pakistan. Business & Economic Review, 10(4), pp.55-82.

Rahman, K.M., 2016. Strategic Planning and Marketing Models. In Strategic Marketing

Management in Asia: Case Studies and Lessons across Industries (pp. 59-110). Emerald

Group Publishing Limited.

Rao, C.P. and Agrawal, G.C., 2015. Marketing Decision Variables in the Context of a Developing

Country. In Proceedings of the 1990 Academy of Marketing Science (AMS) Annual

Conference (pp. 198-202). Springer, Cham.

Samiee, S. and Chirapanda, S., 2019. International Marketing Strategy in Emerging-Market

Exporting Firms. Journal of International Marketing, 27(1), pp.20-37.

Shao, L. and Li, S., 2019. Bundling and product strategy in channel competition. International

Transactions in Operational Research, 26(1), pp.248-269.

Zafar, M.F. and Siddiqui, D.A., 2019. Impacts of Brand Extensions on Parent Brand

Image. Available at SSRN 3384172.