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MARKETING ANALYSIS OF MAMEE DOUBLE DECKER (M) BERHAD

by Hiew Kar Yee

Mkt 501 Marketing Management

Prof Dr Eddie Phun

HELP University

Assignment 1

June 8th, 2019

ASSIGNMENT 1 – MARKETING ANALYSIS

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The purpose of this assignment is to prepare a Marketing Plan by analyzing

and studying the marketing case of a chosen company in Malaysia – Mamee Double Decker
(M) Berhad (MDD) to explore the business to Mongolia. This assignment will mainly
focus on one main product among various product lines, which is the Mamee Monster
noodles snack. It has consisted of a few parts which include the product and
service, the market analysis, marketing strategy and implementation. SWOT
Analysis (Strength, Weakness, Opportunity and Threat) will be covered in the marketing
plan to evaluate the internal and external challenges encountering by the enterprise.

A1. Introduction to the Company, the Product and Brand

Malaysia has the perspective and potential to lead the processed food and beverage
(F&B) industry to the Asia-Pacific region. As the government has emphasized on the
national agriculture sector, the F&B market does play an essential role in the agro-
based industry, especially in the fast food outlets manufacturing. Consumers concern
mainly in preparing meals, snacks, and beverages for immediate consumption and
nutritious. In Malaysia, one of the famous food manufacturers that fulfilled the market
needs in this field is the Mamee Double Decker (M) Berhad (MDD).

Mamee’s story began in 1971 when founder, Datuk Pang Chin Hin and his
companion began a small-scaled built-up plant in Malacca that mass-produced instant
noodles. It is a Malaysia food processing, snack and dairy product company. Mamee
was initiated from modest establishments made its way to success after 48 years of
persistence, enthusiasm, and honest hard work. Today, it serves over 50 products, including
instant noodles, snacks, chilled beverages, confectionery, etc. Mamee Monster, Double
Decker, Smax cracker snacks, Mister Potato Chips and Mister Potato Baked Crackers are
marketed under MDD snacks’ category. They sell instant noodles under Mamee Chef
brand, Mamee Instant and Sllrrp! Noodles. They also offer Cheers Beverage, Nicolet
Swiss Herb Candy and the most recent additions, Nutrigen Cultured Milk and Lite-Yo
Yogurt Drinks.

After multiple trials and researches, the founders finally launched the first ever
product – Lucky Instant Noodles and Vermicelli. Later on, Tan Sri Pang Tee Chew observed
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rubber tappers were consuming raw instant noodles right away from the pack due to lack of
kitchen facilities at a rubber plantation. The Pang Father-Son duo was driven their
noodle making in a innovative way and launched the tremendous crunchy noodle snack: The
Mamee Monster. They named it Mamee, which homophones “Mummy” to represent the
person with whom a child has the most robust emotional connection. As time goes on, Mamee
has made itself a basic in homes all across Malaysia and abroad.

The company has a mission to spread happiness and excitement through food
experiences to the consumers, and their vision is to be worldwide recognized provider
in nutritious food products with a slogan “World of Great Taste”. By implementing
those statements, MDD is practising their core values of involvement, innovation,
collaboration, integrity and fun. The company extended its products worldwide and selling
internationally in more than 100 countries, such as Malaysia, Singapore, Indonesia, Australia,
Saudi Arabia, Myanmar and France. Although it conducts operations through three
manufacturing facilities in Malaysia, Indonesia and Myanmar, the company has a
qualification of ISO 9000s, Hazard analysis and critical control points (HACCP) and Halal
Certifications over all the facilities in the factory. In term of awards, MDD won 2008
Anugerah Kecemerlangan Industri Award, also known as Industrial Excellence Award
from the Ministry of International Trade and Industry (MITI). In the year 2013 and 2014,
MDD has been presented the Frost & Sullivan Award for Best Home-Grown Packaged Food
Company, following with a Putra Brand Award under the Foodstuff Category in the year
2014.

Mamee’s strong financial performance has delivered stellar earnings in the past three
fiscal years. Its net profit more than tripled to RM42.8 million or 29 sen per share for the year
ended Dec 31, 2010 (FY10) from RM14 million or 12 sen per share in FY07 (The
Edge Markets, 2011). For FY10, it posted a revenue of RM482.54 million. As of Dec
31, the company had cash reserves of about RM53 million against borrowings of
RM3.7 million, which translates into net cash per share of 32.5 sen. Excluding the money,
Mamee’s business is valued at approximately RM3.30 per share or RM500 million (The Edge
Markets, 2011).

The Mamee Monster noodle snack is locally produced with Halal certified. It is an
energy-boosting healthy snack that provides three types of seasoning flavours: Chicken, BBQ
and Spicy. It has a memorable blue monster as the brand’s mascot to remind people of their
favoured childhood snack. Recently, it has just launched a new taste named “Xtra Krunchy”
to fulfil the consumer’s satiation. In collocation of the target audience of young
children, together with the idea of pushing the brand beyond boundary with an innovative
spirit, Pierre Pang Hee Ta, the company general manager for sales and marketing and also the
grandson of the founder has created the mascot to be part of the brand identity. With
the blue Mamee Monster retentions firmly as the brand mascot through several
packaging reforms for thenoodle snack, it is currently commanding an 80% slice of the
market (KINIBIZ, 2014). The pricing for the Mamee Monster noodle snack is very
judicious and inexpensive for the concern of all. It costs about 30cents in Malaysia for a
pack of Mamee Monster snack.

A2. Marketing Analysis

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STRENGTH

One of the strength for Mamee is the strong brand reputation among consumer. The
company has a well-organized distribution system where end users can easily access
to Mamee products from a little food retail shop to big ace hypermarket. Mamee had
never failed to meet consumers’ expectation when it comes to product supply as it has 150
vans conduct deliveries jobs from 13 distribution centres to more than 1000 points of sales
(Swot Mamee, 2011).

Mamee has substantial equity in the low-price snack product category, retains
its image and reliability through the consistency of product quality and taste. The brand is
so famous among Malaysian because the majority have had the noodle snack since they were
a kid. Therefore, the brand itself, also the blue Mamee Monster mascot, representing more
than just the product – it’s symbolic of nostalgia, childhood memories, family bonding time
and party snack.

Following with the other strength Mamee poses is they can develop their corporate
network by penetrating new exports field. In 2002, Mamee faced a progress of 6.2%
in venturing to new exports market, and this could be a good start. Within ten years,
it had increased from RM 242 million to RM 257 million with a revenue before tax
documented double-digit growth of 57.3% from RM 9.6 million (Essays24.com, 2011). They
emphasize on improving quality, business network and applicable market tactic which
empower them to remain competing in the market. Also, no doubt that they have a reliable
marketing team to conduct the great promotion. MDD has generously invested around
RM 15.1million into advertising and promotions annually to drive consumer (Essays24.com,
2011). As a long term strategy, this company always aim to occupy the larger slice of the
market share.

The next strength of Mamee will be the big trade title as it had accomplished
numerous awards locally and globally. In the year 2016, Founder of Mamee, Datuk
Pang Chin Hin, has won the Putra Brand Personality Award. In the year 2013 and 2014,
Mamee has honoured the Frost & Sullivan Malaysia Excellence Awards as the best
home-grown packaged food company of the year.
http://www.malaysia-awards.com/pastawards.shtml Mamee had also been rewarded globally
acknowledged as ISO 9002 standard together with China Awards Certificates. Also, it is
halal, and HACCP certified.

WEAKNESSES

One of the weakest point for MDD at the moment is the company has not yet won in
deriving a market portion in China. From the statistic shown at Mamee Double-Decker Food
(Suzhou) Co. Ltd, it has a low market demand from China, thus making little sales
and revenue and causes the company had experienced a higher forfeiture. Even though
the company is fronting difficulty with space limitations in the existing factories to set
up the essential manufacture lines, they do not plan for expansion yet until it breaks even in
coming years. Not to mention the pressure from competitors from the same range such as
Wangwang,Khongyuen and Oishi that already have their loyal customers in China. However,
MDD never lost their hope in extending their products to the China market. They even hired
an advisor to resolve this issue.

Another weakness from MDD is the high dependency of raw material origin
from Europe. The cost price fluctuated according to the rise of the Euro against USD the
MDD is earning. It gives force per unit area to its net income margin when the
monetary value of natural stuff increasing. Therefore, Mamee required to develop more in
R&D to lower down its reliance from an external supplier.
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OPPORTUNITIES (PESTLE)

Politics & Economy

Uncertainty over government policy could be weighing down on local

food manufacturers like Mamee. A businessman has difficulty in having confident
towards government policies due to the uncertainty that may affect their investments. For an
instant, the government had changed its decision on levy fees for foreign workers who have
worked in the country for longer than ten years, which might directly affect the
margin price of Mamee production line. According to the FMM-MIER survey, data expected
a declination for sales, production, capacity utilization and employment in the first half
of 2019. During September 2018, the government has introduced sales and service tax
(SST), has indirectly increased the cost of doing business among Mamee by up to 10% (Lee,
2019). The rising of uncertainty could be an opportunity for Mamee to look for fresh,
innovative solutions to help control their costs and still grow. For example, Mamee could look
for any other rising brands to help add new product lines versus investing in their R&D to
help save time and cost, as well as reach new customers.

Social

A significant trend nowadays is the rises of health-conscious by overall consumers as

it provides opportunities to Mamee in inventing a new product that is healthier with
more options. To expand its product feature and value, Mamee plans to conclude its product
to be part of the healthy diet snack. It has identified several suppliers to negotiate in
providing health suppliers of food. Due to consumers' busy lifestyle, they are increasingly
opting for convenience yet nutritious and health benefits foods. Generation-Z
consumers even categorized themselves as “clean eaters” and have a keen attentiveness in
whom and how the product has been made (Musa, 2015). By understanding the culture,
Mamee started to produce corn snacks in addition to noodle snacks. Also, they know that
transparency into how food is prepared and where will be the key. They also plan to present
more variety of snack foods in Myanmar due to the high demand for snacks in the country.

Also, Mamee adopts a lot of Corporate Social Responsibility (CSR)

program throughout the years because they believe in giving back to society. Mamee’s
CSR good reputation can be proven when they distributed 6,000 “Mamee Classic” and
“Mamee Monster” packs of noodles and snacks with secondary students of IDEAS
Academy, an Education Centre for refugee students in 2018. Since 2011, Mamee has
established “Mamee Prihatin” (Mamee Cares) banner that was representing their position
in CSR campaign to conduct charitable deeds. They cover not only refugee students
but also orphanages, old folks’ homes, natural disaster victims, etc (www.thesundaily.my,
2018). By doing more and more CSR programs, Mamee can potentially benefit from better
brand recognition, positive business reputation, sales increases and accumulate more loyalty
customers.

Technology

In the year 2018, Mamee adopted Japanese robotics technology worth RM 2 million
for its noodles production. This technology that supported by the Malaysian
Investment Development Authority can meet the industry’s requirement in term of
safeguard products quality, cleanliness and food safety. It empowers the business to
stay competitive in a challenging marketplace. With the advanced technology, it
enhances the manufacture of noodle snack and reducing dependence on the workforce.
According to the Chief Executive Officer Datuk Gary Choo, the technology would boost
productivity as much as 10% increases, with leaner manpower required too
(Thestar.com.my, 2018).
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Every year, Mamee will spend 90% of its RM 100 million capital expenditure
(CAPEX) on upgrading its facilities and machinery in one of its Malacca plants. By doing so,
the company could keep abreast with the newest technology in the industry for further
growth. For example, they have just launched the new thinner and crunchier noodles that give
the iconic snack an irresistible extra crunch. Besides, instead of just spending on traditional
mediums like radio, TV and print for promotional tools, they also open to embracing
alternative media like online advertising and social media, which comes with high efficiency
and lower costs. https://www.thestar.com.my/business/business-news/2011/03/26/mamee-
to- upgrade-facilities/

Legal

JAKIM gets more than 100 applicants yearly for its halal certification from
global firms, especially those from China, Japan, South Korea and Taiwan (KLSE Screener,
2018). Numerous Chinese and Japanese exporters have struggled to export their foodstuffs to
Arab countries using halal certificates released by China, but the exports have rejected
the admission. However, it is a plus point for Mamee to hold a halal certificate issued
by Malaysia government because it is recognized and accepted by other nations as
well, especially Arab countries. Therefore, Mamee has the ascendancy to export the noodle
snack for more significant coverage.

For example, in the year 2017, Mamee has teamed up with South Korea’s Shinsegae
Food to generate halal food merchandises for Islamic countries. Through sharing their
proficiency in the industrial and amenities of F&B, Shinsegae Mamee Sdn Bhd provides the
best platform for both parties to reinforce and expand in the Asia-Pacific region as a joint-
venture company. The president of Shinsegae Food, Mr Choi Sung-Jei, targeted to be a one-
stop halal F&B supplier of tremendous and dependable quality products with authentic
flavour and services served specifically to all food vendors. It is a stepping stone for Mamee
in discovering and presuming into South Korean halal food services and industrial.

Environmental

The Mamee team in Kuala Lumpur will be moving into luxury co-working space at
Colony @ Mutiara Damansara in Petaling Jaya, Selangor. The area is about 19,000 sq
ft, which is located five-minute walk to The Curve shopping mall, with Grade A facilities,
Green Building Index Gold Certified and MSC Status building (Khoo, 2019). The Deputy
General Manager Pierre Pang desires to send the signal to everyone that they are
committed about having a great working environment for their team as Colony is one of the
beautiful luxury workplaces that would boost workers’ productivity to 110% (Khoo, 2019).
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THREATS & CHALLENGES

Consumers tend to concern on the ingredients and qualities of products before

purchasing because people nowadays are more educated and conscious about health.
Not only that, but they will also make price comparison with similar product from other
brands. Therefore, the risk of MDD is the competitors in the market like, for example,
Munchys, Nestle, Unilever foods. Changing of consumer preferences is one of the
challenges Mamee encountered too. Consumers nowadays want fortified and practical
foods that promote gut health, fuel their brains and benefits their physical appearance. With
today’s timely access to info, a consumer will never leave it behind if they couldn’t
understand or figure out the origin or content of a particular ingredient in the product.

Moreover, competitors in China is a more significant external threat, especially

in Shanghai due to the complexness of the market in China that manufacturing various of
snack- food products that targeted the same market.

SUMMARY

Product innovation and differentiation play an essential role for Mamee’s future path
because there are so many different products accessible for purchase in a mass of channels –
from a retail store, grocery shop, supermarkets, hypermarkets, online, social media, etc. A big
company like Mamee should have a well-thought plan to emerge with technologies, mergers
or acquisitions, so that can adopt changes to meet consumer’s needs. The elements of
personalized and focus on details, from raw materials of the product to colour usage of the
packaging, could lead Mamee to the next level too.
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REFERENCES

Essays24.com. (2011). Swot Mamee - Term Papers. [online] Available

at:
https://www.essays24.com/essay/Swot-Mamee/28259.html [Accessed 6 Jun. 2019].

Khoo, N. (2019). Malaysia’s largest snack company moves KL office to

Colony@Mutiara Damansara. [online] The Edge Markets.
Available at: https://www.theedgemarkets.com/article/malaysias-largest-snack-
company-moves-kl-office- colonymutiara-damansara [Accessed 6 Jun. 2019].

KINIBIZ. (2014). The start of the noodle company. [online] Available at:
http://www.kinibiz.com/story/issues/97478/the-start-of-the-noodle-company.html
[Accessed
6 Jun. 2019].

KLSE Screener. (2018). Mamee to share halal expertise at Winter Olympics in South Korea.
[online] Available at:
https://www.klsescreener.com/v2/news/view/338801/Mamee_to_share_halal_expertise_at_W
inter_Olympics_in_South_Korea [Accessed 6 Jun. 2019].

Musa, Z. (2015). Mamee plans new product line - Business News | The Star Online. [online]
Thestar.com.my. Available at:
https://www.thestar.com.my/business/business- news/2005/07/06/mamee-plans-new-product-
line/ [Accessed 6 Jun. 2019].
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The Edge Markets. (2011). Mamee-Double Decker a tasty privatisation target?. [online]
Available at: https://www.theedgemarkets.com/article/mamee-double-decker-
tasty- privatisation-target [Accessed 6 Jun. 2019].

Thestar.com.my. (2018). Mamee to adopt robotics technology worth RM2mil -

Business News | The Star Online. [online] Available at:
https://www.thestar.com.my/business/business- news/2018/01/23/mamee-to-adopt-robotics-
technology-worth-rm2mil/ [Accessed 6 Jun.
2019].

www.thesundaily.my. (2018). Mamee’s CSR contribution. [online] Available at:

https://www.thesundaily.my/archive/mamees-csr-contribution-IUARCH576658 [Accessed 6
Jun. 2019].

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