Concept Development

The first step is to refine the given product idea “Can Wine” into testable
product concept.
A product concept is a detailed description as to how a consumer should view
our product.
The concept of our product formed the basis of the survey we conducted to
understand the consumer behaviour and preferences regarding the product
offering.
Product Idea: Producing a canned alcoholic drink that is refreshing, tasteful
and easy to carry.
The product idea was turned into product concepts based on
1. Who will use the product?
2. What is the benefit from the product?
3. When will they use the product?

Product concepts:
Concept 1: Quick drink which is easy to carry for people with busy schedules.
Concept 2: Easy to store alcohol for nuclear families and bachelors with no
hassle of storing leftover wine.
Concept 3: Easy to carry small cans of wine for adults who like
outings/picnics/trekking.
Concept 4: Easy to serve and cost-effective status symbol for dinner party
hosts.
 Concept to Strategy- Conjoint Analysis
A survey was conducted to understand the consumers’ reactions and
responses regarding our product. The survey also gave us a clear insight as to
what are our customers’ needs and behaviour with respect to our concept.
(Refer the survey report on page no.)

Based on the survey we developed a conjoint analysis to determine the

features and pricing aspects of the product.

PRICE PREFERENCE
50
45
40
PERCENTAGE OF PEOPLE

35
30
25
20
15
10
5
0
100-150 150-200 >200

PRICE RANGE

The most preferred price range is ₹150-₹200.

QUANTITY PREFERENCE
70

60
PERCENTAGE OF PEOPLE

50

40

30

20

10

0
250 ML 350 ML 500 ML
QUANTITY

The most preferred quantity for single consumption is 250 ml.

 BENEFIT PREFERENCE
35

NUMBER OF PEOPLE 30
25
20
15
10
5
0
QUICK DRINK PRICE EASY TO EASY TO EASY TO
CARRY CONCEAL SERVE

REASONS TO BUY

The majority of the people are looking for quick drink that is affordable and
easy-to-carry.

From the above analysis we can find the following preferences of the
consumer both utilitarian and behavioural.
1. The consumers’ most preferred price range is ₹150-200. So, our product
pricing should be in or around that range.
2. The consumers’ most preferred quantity for a single consumption is 250
ml. So, we would sell our product in 250 ml cans.
3. Our consumers behavioural focus is mostly on having a quick refreshing
drink that is affordable and easy to carry thus it should be our main
focus for product offering.
 Segmentation, Targeting and Positioning

For segmentation, targeting and positioning our product we followed

the following steps in the given order.

Define the market for the org

Choose parameters for segmentation and create market segment

Evaluate segment on set criteria

Evaluate the attractiveness of the segments

Select Target Markets

Develop positioning startegy

Develop Marketing mix.

Step 1: Defining the market for the organization

1. All individuals above the age of 18.
2. People looking for a quick alcoholic refreshment.
Step2: Choosing parameters for segmentation and creating market segment
Following parameters were chosen for segmentation-
1. Geographic
2. Demographic
3. Psychographic
4. Behavioural
 Geographic

Urban Semi-Urban Rural

Demographic
(Based on Income)

Moderate High Income

Low Income
Income

Psychographic

Lifestyle Preference

Associated
Busy lifestyle Slow lifestyle Taste and smell
image
 Behaviorial

Frequency Ocassion

Low Parties

Moderate Outings

High After dinner

Step 3: Evaluating segments on set criteria for target market
Sr. no. Criteria Considerations
1. Segment Size The youth population in India is high. Also,
huge number of people migrate to cities for
employment.
2. Segment Growth Rate Increasing youth population in the city,
increasing preference for western lifestyle and
drinks, wine is considered as a luxury product

3. Profit margin Targeting middle to high income group lets

achieve higher profit margin.

4. Competitor Competitors are not well established in the

field of canned wine. However, the most
prevalent substitute for canned wine is canned
beer. Thus, targeting the segment with a
preference for specific taste and smell can be
beneficial.
5. Distribution channels In rural India, the alcohol market is dominated
by the unorganized alcohol sector and
unorganized channels. Also, the average
income is low.

Step 4: Selecting Target Market

1. Urban population
2. Age above 18, and having a moderate to high income
3. Busy lifestyle, preference of high quality, good taste and smell
4. Moderate to high frequency, prefers to drink on social occasions
Step 5: Positioning
Affordable, Easy to carry, Quick alcoholic refreshment
(Positioning is based on consumer responses in survey)
Step 6: Developing Marketing Mix - 4Ps
Product Can Wine
Price ₹150-200
Place Liquor off shops, on shops, bars and restaurants
Promotion Indirect advertisements due to government regulations.
 Product Development
Product levels- Customer value hierarchy
Five product levels-

Potential Product

Augmented
Product

Expected
Product

Basic
Product

Core
benefit

Core Benefit Quick drink.

Basic Product Quick alcoholic drink that is in a can

Expected Product Quick alcoholic drink that is refreshing, cost effective

Easy to carry and store, small cans of wine with great

Augmented Product taste and smell

Potential Product Symbol of status

 Branding
1. Selecting Brand name:
Brand name: “Reindeer”
While selecting brand name we use strategy of putting some halo
around the product. We selected “Reindeer” as it represents a royal
culture. Also, reindeers are associated with sleigh rides in snow and our
product feature is one that takes us on a joy ride.
2. Selecting logo:
A picture of red coloured reindeer is selected as logo.
3. Selecting Slogan:
We came up with a slogan for Reindeer that captures our value
proposition and is a crisp communication of what our brand stands for.
“Takes you on a royal ride”
 Product Mix

Under the brand of Reindeer, we have 3 product lines and these form
our product mix.
Product line Name Segment
White wine Reindeer Carta Blanca Premium (upper)
Red wine Reindeer Carta Rouge Value (lower)
Rose wine Reindeer Carta Rosa Moderate (middle)

Reindeer

Red wine White wine Rose/Pink wine

Reindeer Reindeer Reindeer
Carta Rouge Carta Blanca Carta Rosa
 Pricing
1. Selecting Pricing Objective-
Maximum Market share:
We would set a price assuming the market is price sensitive and
would go for Market penetration pricing.
2. Determine the Demand- We carried out an online survey to gauge
demand
3. Cost Estimation- Our Cost estimation method was “Target costing”
According to the survey best acceptable price for canned wine came out
to be ₹150 (red wine).
Giving 15 % margin to distribution channels, our Selling price would be
128.
Considering profit margin of 20%,
Target cost per unit = selling price/1+profit percentage.
= 128/1+0.20
= ₹106
Red Wine Rose Wine White Wine
Fixed cost
manufacturing cost (₹) 10000000
advertising budget (₹) 10000000
salary and other expenses (₹) 5000000
Variable cost
Commission per unit sale (₹) 5 6 8
Variable manufacturing cost (₹) 30 35 40
Shipping breakage and insurance (₹) 2 2 2
Total (₹) 37 43 50
Profit earned per unit (₹)
25000000

Break even volume 384615.3846

4. Analyzing competitor’s price, offers, costs etc: Since there are no major
competitors for Can Wine in India, we considered prices of nearest
substitute available for customers which is canned beer while pricing.
5. Selecting a pricing method - Our pricing method is Perceived- value
pricing since our focus would be to deliver more value to customers and
to demonstrate this to prospective buyers through advertising and
salesforce.
6. Selecting the final price - The final price was chosen such that it is between
low price threshold and upper level threshold of consumers to make it
more acceptable.
Carta Rouge ₹150
Carta Blanca ₹200
Carta Rosa ₹170
 Market testing

We are planning to carry out market testing by using the method of

Controlled Market Testing.
We would specify the number of stores and specific areas in cities to
test. Sales will be measured through electronic scanners at the checkout.
A sample of consumers can be interviewed later to give their
impressions of the product

Commercialization

Reindeer being a small company, we are planning to select one or two

attractive cities in initial phase of commercialization and then enter
other cities one at a time.

Cities for commercialization-

As our company is a new one, we will focus our sales on two major cities
in India which spend the most on alcoholic drinks. Introduction of red,
pink, and white variations of wine in three different price ranges for
consumption.

o Delhi: Average monthly consumption in Delhi is 5 lakh litres of

alcohol and average monthly expenditure on alcoholic beverages
is ₹6 crore.
o Mumbai: Average monthly consumption in Mumbai is 4.3 lakh
litres of alcohol and average monthly expenditure on alcoholic
beverages is ₹5.8 crore.
o Option of Goa is also open.
Since our product is in introduction stage of PLC, aggressive promotion
will be our focus in order to capture market share. Major substitute for
can wine is canned beer, hence we have kept penetrating prices for our
product.