Product+Launch+Plan+Team+B | Distribution (Business) | Marketing



Product Launch Plan Learning Team B Hilary Amara Tricia Jones-Parkin Rajesh Kumar May Joyal S. Simmons MKT/571 January 24, 2011 Erin Spurling



Product Launch Plan GlaxoSmithKline will launch AdraC, (derived from the word Aadrak, the Ayurvedic name for Turmeric and enhanced with Vitamin C) a fruit juice enhanced with turmeric. The product launch will take place both in the United Kingdom, the domestic country and India, the international market. Turmeric is rich in medicinal values. It is used to help with digestion and liver function as well as to relieve arthritis pain. Turmeric is also used for heartburn, stomach ulcers, and gall stones. It can be used to reduce inflammation and prevent and treat cancer (IBISWorld, 2010). As consumers in both the United Kingdom and India are searching for healthy beverages besides soda, AdraC is an adequate product and Glaxo will promote the advantages and benefits found in the turmeric used in the fruit drink. The chemical constituents of turmeric include 5%8% of volatile oil, curcumin which is considered the active ingredient, vitamin A, and more than 6% of protein. Additionally, the turmeric in the drink contains 3.5% percent of minerals, more than 5% of fatty acids and 69.4 %t of carbohydrates. AdraC fruit drink will not only meet the needs of health-conscious consumers but will also quench the thirst of those who will purchase the product for convenience including satisfying their thirst drinking on-the-go. Product Positioning Positioning is the act of designing the company¶s offering and image to occupy a distinctive place in the mind of the target market (Kotler & Keller, 2006). AdraC will be positioned based on the needs of the consumer. At the same time, the product will be positioned in such a way that the target market will recognize the distinctiveness and image of the brand.

³If a company does an excellent job of positioning then it can work out the rest of its marketing planning (Kotler & Keller.d. fruit drinks are popularly used in most urban households. juice and juice drink brands need to target promotions on the superior taste of their products to be able to tap into those consumers who agree that fruit juice and juice drinks taste good compared to other soft drinks (Mintel. In the United Kingdom. n. Socially responsible marketing involves targeting and positioning that will serve not only the company¶s interest but also the interest of the targeted segments (Kotler & Keller. Targeting Glaxo will target the young people in both the United Kingdom and India. Glaxo has identified market segment opportunities especially in teenagers and will accommodate both current and future customers. This target group is searching for health-based nutritional drinks as they pursue a healthier lifestyle. 2006). As a result. Targeting specific customers can increase profits and knowing and understanding . The majority of young audience in India and the United Kingdom will buy the idea of Glaxo¶s new fruit drink product because of the need for healthier drinking habits. Indian fruit juice market is an unorganized and newly developing market.). 2006). Glaxo will take advantage of the developing market for fruit drinks in both the United Kingdom and India and promote the uniqueness of AdraC including the benefits of the turmeric used in the fruit drink mix. The sector however is becoming more and more organized and is attracting more players into the market. Glaxo will target these consumers on the basis of the benefits provided by the new product. This step will leave a lasting impression in the mind of the target market. 2010). Glaxo will be the first to offer the new health drink enhanced with turmeric. Indian consumers are moving toward branded fruit juice because of their improvement in health consciousness (Reportbuyer.PRODUCT LAUNCH PLAN 3 In India.

The consumption of carbonated soft drinks is declining and in India and the United Kingdom. Market Needs The market need for Glaxo¶s new health drink product is very high. Turmeric is also used for either cooking or as a supplement. Some people are already aware of the health benefits found in turmeric that is used to enhance the fruit drink. Many consumers are seeking better value and a healthier product because of the lower juice and sugar content in the juice drinks (Mintel. the juice drinks subsector has outperformed fruit juice. In the United Kingdom. Second. the product choices that consumers make are highly influenced by such nutritional awareness.PRODUCT LAUNCH PLAN 4 the market makes it possible to respond to customer needs and react to competition (Kotler & Keller. AdraC has all of the potentials to meet the market needs and succeed in both the United Kingdom and India. The rising level of health consciousness is forcing many manufacturers including juice makers to offer more enhanced and functional products. there is increasing awareness of the health benefits in food and drink. As a result. The target market will be segmented into two groups. In both the United Kingdom and India. the drinking for convenience segment that is for consumers who will purchase the product just to satisfy their thirst. Launching AdraC will make it convenient for consumers to derive the benefits of turmeric more readily. 2006). consumers are looking for healthy beverages besides soda. Market Potential and Market Growth . First is the health-conscious segment in which the needs of consumers seeking healthy fruit beverages will be met. 2010). Careful consideration of demographic factors reveals that young people will be the highest level of consumers of the new product.

Revenue is expected to rise 6. 2010). this will not deter Glaxo¶s new product launch because justification of its health benefit claims will be supported by exemplary research. A decline in the consumption of carbonated soft drinks (CSD). Water has performed poorly over the past five years leaving room for increased fruit juice and functional drink consumption (IBISWorld). as a direct substitute for these products is noted also. The estimated total UK market for functional foods grew by 9. the functional beverage production industry is expected to grow at an average rate of 6. explains that the growth of functional beverages play a significant role in new product development in the UK. India The use of Turmeric is not new in India. It is primarily used as a spice and has been in use for more than 2500 years.6% by the end of October 2009 with a value of £1. However. the consumption of products with functional benefits remains high as reported by Mintel International in January 2009.PRODUCT LAUNCH PLAN 5 Increasing consumer awareness and interest in health promotion and prevention of diseases and Glaxo¶s global experience and specialization in research are key factors in the successful launch of AdraC. The market growth is likewise projected to be incremental.5% to 6. a slight decrease in growth is estimated (Stones). United Kingdom Stones (2010) reports that growth of functional beverages in the UK will grow from 4. Functional Foods 2010.8 billion by end of 2010 as the popularity of the functional drinks and other new products usually marketed toward a young audience sets the consumer trends (IBISWorld.8%. Turmeric¶s medicinal benefits have been slowly unraveled over . The market potential in the United Kingdom (UK) and India is significant as discussed herein. As the European Union (EU) legislation threatens to impose tighter regulations for product development in functional products.5 % in the next five years.46bn. Globally.7% to $ 24. According to Scott (2010).

which are on the rise in India.PRODUCT LAUNCH PLAN 6 the centuries (Health Diaries. n. weaknesses within the company and the introduction of this new health drink.). This familiarity will solidify the potential for growth and sustainability in the country.84bn) in 2016 (NutraIngredients.7bn (¼645m) in 2009 driven by rising health awareness and the appeal of supplements to fight obesity and overweight problems. this trend will translate to market worth of 107. SWOT Analysis ± United Kingdom Strengths y UK-based Glaxo is a well-established global company with extensive experience and specialization y Products and innovations arise from sophisticated Research and Development functions and processes y Supports company mission and strategic direction to grow a diversified global business and deliver products of value y y y Market potential and growth confirmed by current market trends and research Product benefits strongly supported by historical data and research Turmeric is slowly gaining popularity in many countries including the UK . SWOT Analysis The SWOT analysis outlines the strengths. 2011). According to Frost and Sullivan researcher.d. This market industry was worth INR37. India is believed to be one of the most attractive markets in the world for food and drinks with functional claims. It also depicts the opportunities and threats the company faces with the offering of this new product.7 billion rupees (¼1.

PRODUCT LAUNCH PLAN 7 y Supports the goals of the Department of Business. Weaknesses y The need to maintain natural fruit flavors even with added ingredients to allow greater acceptance The challenge of establishing brand awareness as current product use is localized in India and Indian communities in other countries y Opportunities y The ability to capitalize on increasing customer awareness and interest in health promotion and prevention of diseases y y Secure patent and trademark for new product Rebounding economy may encourage consumer spending on items with functional benefits Threats y Competition with other companies currently producing drinks or supplements that offer similar health benefits y Potential competition with other reputable companies emerging with similar product y Increased scrutiny from EU legislation and evaluation of current regulations on functional drinks and their health claims SWOT Analysis ± India Strengths y y Strong familiarity to Turmeric Health benefits of Turmeric are well-known and accepted . Innovation. and Skills (BIS) for sustained and balance growth.

PRODUCT LAUNCH PLAN 8 y Manufactured by a well-known global company specializing in research and development y y Strengthens local economic growth and employment opportunities Supports the Foreign Direct Investment (FDI) policy of long-term economic development through opening India¶s doors to technology transfer and improvement in infrastructure and productivity Weaknesses y y Volatile political environment and intense nationalistic sentiment Challenge of strategic adaptability and shared vision between Glaxo and subsidiary in India Opportunities y Ability to sustain interest to Turmeric and take advantage of ³want-to-be-healthy´ trend y Strong projected economic performance and GDP growth that will enhance consumer spending y Threats y Product launch subject to approval and compliance to local laws and from the department of Foreign Direct Investment y Potential competition from juice and juice drink makers who will offer similar product y Communication and cultural differences Competition Decreased product and operations cost by way of economies of scale .

Times of India reported in April 2010 of a joint venture between PepsiCo and Tata Tea to produce non-carbonated ready-todrink beverages. The manufacturing trend of functional beverages continues to grow. and Ribena. wellness drinks. there are indirect competition from juice and juice drink manufacturers. Glaxo is yet to have direct competition from manufacturers that will offer the same product. more drinks that offer health benefits continue to prosper. . states that a survey conducted by Beverage Industry showed that juice processing labs and water bottling facilities started looking at R & D for energy drinks and beverages with health benefits. vitamin and mineral-enriched drinks. Likewise about 51% of juice makers purchased vitamins and minerals in search for beverages that will offer health benefits. 2010). Penn (2005). ACE drinks (fortified with A. The increasing trend in health consciousness has encouraged many manufacturers particularly juice makers to offer more enhanced and functional products. The trends in preference for organic products in 2008 and interest in superfruits for their antioxidant and medicinal benefits in 2009 also compelled manufacturers to produce drinks with these components (Scott. energy drinks. centered on health and wellness. In the UK specifically. However. AdraC will join Glaxo¶s own line of functional drinks like the Lucozade. Glaxo will see indirect competition in the UK and India with other functional beverages such as sports drinks.PRODUCT LAUNCH PLAN 9 Glaxo Smithkline will be the first to offer an array of health drinks and juices enhanced with Turmeric. As manufacturers acknowledge this phenomenon. AdraC¶s quality and health claims are supported by the company¶s own and renowned R & D processes. nutraceutical drinks. In India. C or E antioxidant vitamins). Soft drink producers and coffee and tea manufacturers are focused on packaging. Horlicks. and herbal drinks. near-water drinks.

and is Vegan. 2010. Increase product awareness among the target audience by 30% in one year. the target audience should be consumers interested in a convenient beverage alternative to turmeric capsules or adding enough to food to realize the maximum benefits. feel better and live longer´ (n. Because AdraC is made of all natural ingredients. Glaxo¶s objectives include: 1. Facebook and Twitter). leading to a 5% increase in sales. the amount of money required to produce AdraC must be determined so that the right price can be set. Third." Marketing Strategy Glaxo needs a game plan through which its marketing objectives can be achieved. To achieve this. Kosher. Inform the target audience about features and benefits of the product and its competitive advantage. 2. social media outlets (e.PRODUCT LAUNCH PLAN 10 Marketing Objectives Glaxo¶s vision is to create a delicious turmeric enhanced beverage that provides the rich benefits of turmeric in a convenient quality product. display ads. leading to a 10% increase in sales in one year. Second. p. Glaxo can stand behind this statement especially with the launch of AdraC. Glaxo has a challenging an inspiring mission to improve the quality of human life by enabling people to do more. First.d. sponsorship. promotion of AdraC will include radio. Enhance store image in all markets within a one year period. and food conventions. 1). 3.g. this is a perfect niche market for Glaxo to enter.el better and live longer. and gluten-free. Decrease or remove potential customers' resistance to buying AdraC leading to a 20% increase in sales that are closed in six months or less. 4. television. . Combining the convenience of this product with a reasonable price will contribute to a successful product launch in the United Kingdom and India.

Current pricing for the U.K market is ¼3. is to make a decision on the cost. psychological pricing. Prices are driven by several factors that include premium pricing. product placement will not only be available in local markets. Based on this price and the current exchange rate for the Indian Rupee. Glaxo must focus on geographical pricing because variations of price in different parts of the world exist. and sponsorships are considered to be the norm. Pricing One of the first steps that Glaxo must consider when determining the price strategy of AdraC. supermarkets.50 per 32cl bottle. geographical pricing. promotional pricing. economy pricing. 2010) Marketing Communication Communication in today¶s world is more than just radio spots and display ads. to do so will depend on how responsive demand for their products is to changes in price´ (MacCoille. At present. value pricing. product bundle pricing. penetration pricing. 287). Twitter. an increase in the price of any of the essential ingredients can affect product costs and profits. convenience stores. The range can be from religion to culture and . ³Some companies may choose to alter their prices if they judge that doing so will increase profits. and various all natural juices are subject to diverse market forces thus. This marketing strategy holds true for both Glaxo¶s domestic and international markets. 2009.. optional product pricing. 2010). product line pricing. both domestically and internationally. but also through specialty grocery stores. The strength of this strategy is its intrinsic support of the company¶s marketing objectives. These social media sites are the height of media focus for common interest. and online.PRODUCT LAUNCH PLAN 11 Fourth. the approximate price for the foreign Indian market is 216. Facebook. price skimming. AdraC¶s key ingredients ± p. and captive product pricing (Marketing Teacher Ltd.624 per 32cl bottle (x-rates.

Distribution Strategy Distribution Channels A channel of distribution is an interdependent network of retailers. or turmeric for example into a Google search the goal is to have AdraC and Glaxo to be at the top of the results list. The importance of distribution functioning marketing is apparent when one considers the magnitude of goods and services that are transported and sold in millions of locations throughout the world. wholesalers. or it may be made up of multiple buyers and sellers at different levels e. When a potential customer types health. Intermediaries arise to overcome the discrepancy between the assortment of the goods and services generated by the producer and the assorted demand by the consumer Sorting out. Marketing channels also include communication channels and service channels designed to facilitate transactions. Other media will include placement of ads in health magazines and whole food markets that cater to the niche health and diet concerns market. whole sale and retail. By publications and free advertisements on these social sites Glaxo can achieve the power of word of mouth to do the work. . fruit juice. The distribution channel may consists of one buyer and one seller (direct channel).g.PRODUCT LAUNCH PLAN 12 from location to tastes. These can include social organizations that allow Glaxo¶s product to be synonymous with the culture it wants to reach. Assessing each of these areas will help the company to build a plan that maximizes profits in both England and India. distributors and agents responsible for moving a good or service from its point of origin to the final customer. Need for Channel Intermediaries Intermediaries rise in the exchange process because they make the process more efficient.

Wholesalers and retailers. manufacturers. The design of distribution channel is an important strategic decision. functions of supply and facilitating activities are some of the main functions of the channel partners. The channel is most appropriate when the producer¶s objective is to achieve maximum market penetration with intensive distribution. There are four basic producer-to-consumer channel alternatives. and other facilitators also are an integral part of the distribution.PRODUCT LAUNCH PLAN 13 accumulation. provide the focus of this section. and other organizational buyers and suppliers. Channel selection and design. following the general marketing management process. They may neglect one line for others that are more profitable of particular concern. Customers must be able to purchase goods and services when and where they find it from a number of manufacturers. Manufacturers. The major four issues are . The longest most indirect and the longest channel includes producers. The traditional marketing channels used by industrial firms. Organizational Marketing Channels. Channel management includes a broad range of issues and responsibilities. allocation. Marketing agencies work together in channel arrangements to make routine transactions. grocers. Channel members. assorting are some of the functionalities of the intermediaries. retailers and consumers. For distribution to final customers. Channel Structures and Marketing Systems Consumer marketing channels. The organizational customers include both for profit and nonprofit entities that produce other goods and services. Functions of exchange. Channel management. one or more wholesalers or agents. the key to cost distribution strategies. physical distribution providers.

000 $20.750 $60.150 $25.020 $58.000 $0 $210.050 $89. This strategy requires an alliance with a foreign business or government that enables the firm to produce and sells goods in that market.500 $20. Financial Information (Product Launch Budget) 2011 1st Sales Forecast $ 1.770 $411.000 $75.000 $18.112.886 $220. Overseas distribution could include an orthodox channel. International distribution typically starts with the manufacturer and its exporting organization within its own country and ends with the final foreign customer. International channels decisions are related to market entry strategies and legal and political constraints.675 $85.750 $222.000 $20.000 $17.500 $0 $160.040.500 $23.015 $125.000 Grand Total $562.000 $55.000 $18.000 $24.100.900 $70.000 2013 4th5 $ 2.532.500 $20.000 $60.770 $388.000 2012 4th $ 1.850 $471.999.000 $70.850 $22.670 $37.000 $15.000 $145.010.750 $60.170 $24.500 $70.000 .110 $464.089 $54.000 2nd $ 1.350 $21.050.988.000 $20.800 $133. Longer channels require a broader view of the total distribution process.000 $18.364 $455.175 $490.848 $57.343 $533.550 $20.000.970 $56.560 $85.000 $24.500 $22.975 $112.000 $18.000 $55.000 1st2 $ 2.000 $15.555 $2.500 $17. International distribution affects nearly every company regardless of its involvement in importing or exporting.000 $60.020 $58. International Channels.365 $20. longer lead times and problematic cultural differences among channel members.000 $22.500 $70.000 3rd $ 1.000 $75.750 3rd8 $ 2.350 $202.729 $110.650 $110.000 $150.500 $77.000 $112.500 $80.003 $22.800 $80.000 $21.000 $20.875 $83.000 $20.650 $88.045 $156.000 $20.765 $88. A United States manufacturer can approach direct distribution in two ways sell US made goods directly to an overseas customer or produce goods in a foreign country and sell directly to targeted customers.772 $830.030 $17.000 $85.993.210 1st6 $ 2.000 $22.000 Category Advertising Catalogs Direct Mail Literature Product Launch Public Relations Resellers Trade Shows $197.465 $532.PRODUCT LAUNCH PLAN 14 channel power and relationships.005 $93. legal.503 $22.537.190 2nd7 $ 2.125 2nd3 $ 2.350 3rd4 $ 1.670 $26.150 $35.005 4th9 $ 2.620 $649.000 $25. As suppliers extend their distribution overseas they are faced with more complex and costly channels decisions.550 $25.450 $81.000 $21.000 $25.000 $77.800 $494.045 $206. vertical marketing systems.045 $143.000 $150.503 $22. and ethical concerns and emerging channel structures.000 $25.000 $22.000 $187.503 $0 $143.055.

Questionnaires. Technological Devices The following technological devices were used: Galvanometers. collection. multiple choice. Tachistoscopes. visualization.PRODUCT LAUNCH PLAN 15 % of Sales 36% 42% 41% 23% 26% 25% 25% 26% 23% 20% 18% 22% Please refer to Attachment A: Product Launch Budget for Detailed Budget Marketing Research Conducted for the Plan The systematic design. Audiometers and GPS. and laddering. projective techniques. Develop the Research Plan The data sources were collected to understand the beverage market in India and UK. analysis and reporting of data and findings relevant to a specific marketing situations facing the company is known as marketing research. Sampling . brand personification. important scale. ethnographic. The research approaches were through observation. The question types were Dichotomous. rating scale. completely unstructured. The research objectives were to project a turmeric based fruit juice into health conscious Indian and European market. lihert scale. Qualitative measures undertaken were word association. survey. and experimentation. intention to buy scale. Define the problem Production of turmeric enhanced fruit juice and distribution to India and the United Kingdom. behavioral data. word association. Eye cameras. focus groups. qualitative measurements and technological devices were used to understand the market topology. and sentence completion types.

healthy skepticism. value and cost of information. The probability samples included Simple random. research creativity. resource adequacy. multiple methods. The external metrics captured for our products were awareness. Contact Methods Mail questionnaire. Stratified random and cluster. Sample size and sampling procedure was chosen to evaluate the market. systems. freedom to fail and autonomy. number of complaints on existing products.PRODUCT LAUNCH PLAN 16 The sampling unit. Marketing Decision Supporting System A coordinated collection of data. market share. Marketing Metrics It is the set of measures that helps marketers quantify. total number of customers for other beverages and the loyalty. relative price. personal interviews. tools and techniques with supporting hardware and software by which an organization gathers and interprets relevant information from business and environment and turns it into a basis for marketing action. distribution. willingness to change. judgment and quota. interdependence. Such a system is called MDSS. desire to learn. and online interviews were conducted orally to collect information. The types of samples used were probability samples and non probability samples. and ethical marketing. customer satisfaction. The internal metrics were awareness of goals. commitment to goals. telephone interviews. Compare and interpret marketing performance. active support. staffing levels. Characteristics of good Marketing Research A good marketing research is an outcome of scientific method. Market Mix Modeling . The non-probability samples were convenience.

media and promotion spending data. Cash flow Metrics pathway and Brand Metrics pathway. Marketing Dashboards A customer performance scorecard was developed to record how well our company performed quarter after quarter on customer based measures. pricing. Unit Metrics Pathways. product term sales and product item sales. product line sales. Common Measurement Paths A couple of measurement pathways were involved in the research. A stake holder performance score card was also developed to track various constituencies. to understand more precisely the effects of specific marketing activities. region. Demand Measurement Ninety types of demand measurements were studies for all sales. company sales. innovative Turmeric enhanced juice drink will be launched by Glaxo in the United Kingdom and India in response to increased health and wellness consciousness. the target market and the penetrated market were all researched well to position the drink both in the UK market and the Indian Market. the available market. The second dimensions were the world. medium run. The time level considered were short run. Conclusion AdraC. Measures of Market Demand The potential market for the turmeric drinks. They were Customer Metrics pathways. territory and customer. country. and long run. Market . industry sales.PRODUCT LAUNCH PLAN 17 Marketing mix models analyze data from a variety of sources such as retailer scanner data company shipment data.

AdraC will be a profitable product line for Glaxo. .PRODUCT LAUNCH PLAN 18 research and analysis show strong market potential and growth in these countries. The SWOT analysis conducted in both countries also indicates a successful launch and consumer adoption. Armed with the appropriate marketing and marketing strategies.

. Fruit Juice and Juice Drinks ±UK. (2010). K.ibisworld.marketingteacher. C.html NutraIngredients (2011). Pricing Strategies. New drinks include a health benefit in '05. Marketing Teacher Kotler.healthdiaries. 49(4). Beverage Industry.).com/calculator. Retrieved from http://www.d.November 2010.html . & Keller. 45.mintel.PRODUCT LAUNCH PLAN 19 Reference Health Diaries (n. (2009). P. (2007). 20 Health Benefits of Turmeric. Mintel (2010). Bank of England.html IBISWorld (2010). 96(1).com/eatthis/20-health-benefits-of-turmeric. New Jersey: Pearson Prentice Hall.htm. Quarterly (2005). Fruit Juice and Functional Beverage Production.nutraingredients. Retrieved from tom n.). C. Retrieved from http://academic. 286-292. Indian supplements market to approach ¼2 bn by 2016. Reportbuyer (n. Retrieved from MasterFILE Premier ket. Accounting for the stability of the UK terms of trade. Retrieved from http://www. Retrieved from http://www. A Framework for Marketing Management (3rd ed. Retrieved from http://www. Indian Fruit Juice MacCoille. Retrieved from Penn.). Retrieved from ABI/INFORM Global. X-Rates.d (2010).x-rates. L.

M. 2010). Beverage Industry. 101(1). Times of India (2010). Retrieved from http://timesofindia. Health trends dominate juice innovations. S. Stones. UK Functional Food and Drinks Market Slows. Retrieved from MasterFILE Premier database. Retrieved from http://www.indiatimes. . Tata ink JV deal for health drinks. (June.nutraingredients. (2010).PRODUCT LAUNCH PLAN 20 Scott.

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