Business to Business Marketing Assignment

Word Count: 3027

Q1) Illustrate how Tetra Pak might segment different types of products and services and customize the benefits offered? Even though Tetra Pak product line include areas like fruit juices, beverages and milk, wine, tomato products, soups, soya, water desserts, nutritionals and other products (tetrapak, 2011) but here we would like to focus on a few items according to the European process food market which we can be segmented due to the increase in demand for those products. Consumers behavior and lifestyles are transforming globally because of the new ways of working, increased mobility, new pattern of activities and changes in the perceived values. Perhaps the most important change is that individuals adopt various different lifestyles and use them at different occasions in order to satisfy their wants and in pursuit of more variety and this archetype shift applies across the board. More than half the families in larger urban areas in Europe are single person households. This figure is rising every year and signifies a segment with reasonably high disposable incomes and substantial purchasing power. Singles split their time between their work and a range of leisure activities. Their demanding lifestyle gives way to marketing opportunities for high quality and convenient food products that does not only save time but also are nutritionally sound and good in taste (Consumer Europe, 2011). The conventional family is once again getting strength in Europe as an institution but not as it used to be in the past. Relatives and families visit each other at weekends with a focus on quality of life. It is very crucial for them to spend time together whilst preparing meals and not just on the dining table. This gives way for marketing opportunities for semi-prepared products to be used as ingredients in meal preparation, allowing the family members to give finishing touch to their meals. But all families have got their own timings and they eat at different times as well, which creates need for highly convenient food. Hence meals must be easy to prepare and quick and still have high quality level. Also increased travelling globally (especially amongst Europeans) and multi-ethnic sway via various media have widened peoples view on food. Individuals are continually open to new flavors and dishes and import them to their own dining tables and kitchens. There are highly specific, small and trend setting restaurants that can serve range of favorites dishes from new and exotic fruit desserts to spicy Cajun soups. So modern restaurants in many ways influence people and light the way for the trendsetters and leaders of the food industry (Consumer Europe, 2011). In addition, in Europe consumer are highly concerned about health and focus their attention on natural and healthy products. Market research indicates that this decade will be presided over by the demands from elderly and the women which are two groups with more money to spend than ever, and with an essential value set that entails natural products, health and functionality. These individuals need to enjoy new practices that appeal to their motivation and emotions. And these individuals are seeking solutions to fit their healthy lifestyles.

Based on the afore-mentioned segmentation and interest of the Europeans consumers, Tetra Pak can focus on the given below products in order to follow the trends for their customers and segment their products accordingly: Tomato products Recent research signifies that processed tomatoes are good for peoples health because of high content of lycopene. And from the twenty years everybody people have witnessed an outburst of refined and new tomato products. Passata and purees have become major products in the Europe together with the more classical ketchup, chilli sauces and tomato past. Fuelled by the interest for cultural food in Europe, there has also been an increasing market for specialty sauces with elements such as salsas with onions and pepper and variety of delicious dip sauces (food&drinkeurope, 2011).

The variety of products in this market is already large and tetra pak can expect it to increase in the future so they can introduce more cooking recipe products. Soups & Sauces Healthier lifestyles demand a strong riposte for soups and prepared soups are quick to serve, convenient and fairly low-cost. In other words, they are ideal for a single-person family and the busy family. Also soups with a high level of crunchy particles such as meat and fish, vegetables and in trend and offer complete meal for the larger craving.

Sauces are another group of products set for a flourishing future in European markets. They are used instead of spices for different kinds of products and low calorie products especially will draw European consumers with fascinating, new and exciting flavors. The prime instance of it and are Low-fat sauces which are flavored with natural ingredients based on dairy products (food&drinkeurope, 2011). Desserts & Fruit preparation The dessert market is on the rise in Europe with consumers opting for new product concepts in recent years. Ready-to-serve single portions are hugely popular and one of the new trends consists of products with an extra energy kick. Fresh exotic fruit incorporated with low-fat dairy filler and with energy-reinforced cereals may well be the next level in this expanding segment and tetra pak can introduce such products to tap into this market. Rice based desserts Rice based snacks and ready-to-eat desserts are a growing segment in Europe. With their energetic and healthy image combined with an authentic fresh taste, these products pull young consumers. Rice is also a rather cheap ingredient that makes it easy to manufacture products with a high value for money.

Tetra Pak have developed a unique line, Tetra Desserto Riceline, to manage everything from complex to simple recipes where rice is one of the main ingredients, therefore based on the European segmentation, they can market their products which has rice ingredients to cater the growing demand for rice based products (Wilmott, 2011). Q2) Tetra Pak will have to consider many factors in order to market their different product and services: a) Using examples explain how the factors could be same? b) Using examples explain how the factors could be different? There are many factors which Tetra Pak or any other company would have to keep into consideration before entering a new market. These factors can be the same for some countries or can be different, but most important of them entails the competitiveness of the market, changing tastes and preferences of the consumers, new brand names and the injected capital etc. Let us discuss a few factors for Tetra Pak which can be same or different for different markets in order to market their products and services: Investment in the Industry: Let us consider an example of the ice cream industry of China. Industry insiders are all agreed in asserting that there will be no development of the ice cream market without investment. Nestle revealed that its ice cream business has grown by 450 percent in the last 10 years by merging with renowned Chinese companies and all business produced by global ice cream brand (Tang, 2011). For instance, in the Chinese market, Unilever has gained a beneficial position via its products of Walls, contending fiercely with other brands in reorganization and purchase. Mengniu is another brand which has attained huge investment from overseas consortiums. Three international consortiums, entailing Morgan Stanley has inserted 216 million yuan ($26.06

million) into the company. Before that, Mengniu amalgamated with a company in Tianjin. The huge capital investment indicates that it will not be too long for its market change (Tang, 2011). But this is the example of the Chinese Ice Cream Industry which faces both regional and national competition for monopoly. And for Tetra Pak to get involved in such industry it should invest on large scale in order to promote its new products and to battle in such a competitive marketplace. Even though, this factor of heavy investment might be different if Tetra Pak moves to a country like Turkey where is the less consumption of ice cream per capita and the competition is not fierce as compared to the big ice cream markets. So the factor of investment would be different for Tetra Pak in Turkey in terms of introducing new products or more products to the ice cream industry to serve growing needs or changing needs of the consumers (Tang, 2011). Brands in Price War Walls Co. Ltd. has decreased the prices of Paddle Pop, Magnum and Cornetto ice cream series this year with a general rate dropping by 40-50 percent and the action of lowering prices has brought about a big impact in the Chinese ice cream industry. Experts reckon that price lessening mainly aims to develop consumer base. In March, Nestle announce to readjust the prices of its range of ice creams from between 1 and 5 yuan (Tang, 2011). In addition, another ice cream brand, Yilis presidents assistant Guo Shunxi announced to adopt different strategies in different districts. For instance, it will sell low-price ice creams in some low-income areas in north China, whilst selling high-grade products in Beijing. So price war would be another important factor for Tetra Pak if they intend to operate in the Chinese Ice Cream industry where they would have to adjust the pricing of the products to compete with other brands and to match the income levels of consumers of different regions. Where as this factor might not be the same in a different market like Turkey where the income levels of consumers are generally good and where there is less competition in the ice cream, which would allow Tetra Pak to maintain its pricing industry and to enjoy more profit margins due to less competition. Q3) Critically discuss and use examples to explain why the environmental approach taken by the company is important and why you think having a respected corporate image is important? Tetra Paks recycling process initiates with designing products that can be recycled and ends by playing an active part in supporting the recovery, collection and recycling of used cartons; so the challenge is to involve the consumers. The approach taken by Tetra Pak is because of the increasing demand from consumers to see companies contributing toward a safer environment and Tetra Paks ambition is to collect as many packages as possible after consumption and be recycled. In addition to having a clear consumer focus, there is another reason why recycling is essential to Tetra Pak which is that it contributes with used cartons as resources for new products (TetraPak, 2011).

In Europe, the EU Packaging and Packaging Waste Directive categorizes cartons as a single grade of recoverable paper, assisting the trade of used beverage cartons as a product. Ever since 2000, the number of Tetra Pak cartons been collected has more or less doubled and Tetra Pak has assisted in several ways to this positive development: Assistance to recycling companies by shifting Tetra Paks own expertise about recycling technology and systems. Support with industry, governments and non-governmental institutions globally to improve the collection of used packages and to provide assistance to the founding of effective regulatory frameworks. Tetra Pak has made investment in communication towards consumers to augment awareness of recycling and collection such as campaigns in newspapers, TV and other channels, often together with other stakeholders and consumers. The other important aspect for Tetra Pak is to reduce carbon emissions and there are several reasons why Tetra Pak reckons it is essential to diminish carbon emissions, not least being the worldwide scale of the firms activities and the extensive size of operations. Tetra Pak is aware of its role in society; and it is also a part of Tetra Paks culture to do things properly and to act as a good citizen (Tetra Pak, 2011). The other reason why Tetra Pak endeavors to be socially responsible is because most of Tetra Paks customers anticipate the organization to contribute to a lower environmental footstep by providing sustainable solutions and products. On the whole, being more energy efficient saves money and contributes to a wellorganized business for Tetra Pak and to a better environment as well. Each organization is liable for the repercussion of its operations on all appropriate stakeholders. So as a good corporate citizen a firm must show respect for the consumers and the community in which it operates and the environment which it functions. It is essential that a firm must return to society, some of the benefits which it has gained through its functions. This is achieved by improving the quality of life of employees and the community and contributing to economic development. Q4) Tetra Pak has several competitive advantages, list them all and discuss that how can they involve stakeholders to maintain those advantages? Tetra Paks biggest competitive advantage is that they provide safe and hygienic food and strive to make it available around the world. In order to maintain this competitive advantage; Tetra Pak work for and with its customers to provide packaging and preferred processing solutions for food and always strives for innovation to provide the safest and best food (Case Study, 2011). Tetra Pak also applies its commitment to understanding of consumer needs, innovation, and relationships with suppliers to offer these solutions whenever and wherever food is consumed. Even though Tetra Pak has a packaging system that makes it doable to sterilize food products such as tomatoes, vegetables, pasta sauces and ready made meals inside the carton package, and Tetra Pak its self is providing these easy to make meals but it can involve its consumers and suppliers to look for new liquid products like sugarcane juices and coconut water.

This is one area where by striving for innovation and putting its expertise, Tetra Pak can tap into this market and increase its profit margins. There is a growing demand and need, especially in countries where its generally hot weather like the Middle Eastern and Asian countries. Since Tetra Pak is a renowned name in providing safe and hygienic food products, therefore by involving their stakeholders and using their expertise would allow Tetra Pak to tap into this market and increase its profit margins and thereby maintaining its competitive advantage of bringing innovative products. In addition, Tetra Pak can involve its stakeholders to bring and innovative addition to its product line by introducing post-deliver mother food items like lactogenic food which includes lactogenic beverages, condiments, oils etc. Since after giving birth to a baby its very important for a mother to look after her diet properly and to take safe and hygienic food, therefore being a reliable name for safe and hygienic food, Tetra Pak through its expertise in innovative products can add these products to its portfolio as well. Q5) Identify Tetra Paks core competencies and critically discuss the significance of those core competencies? The biggest all of competencies that Tetra Pak has undoubtedly includes packaging. Whether there is a need to hold dairy products, soft drinks, wines, soy, juices or solid food; Tetra Pak provides packaging that keeps the product safe, fresh and tasty (Case Study, 2011). First of all, the aseptic packaging and ambient distribution has made it likely to deliver sensitive products like milk to people in distant regions or to those who lack modern amenities such as refrigeration. The Aseptic packaging keeps liquid food nutritional and safe for up to 12 months without the need for refrigeration or preservatives. And other predominant benefits of it include: It is easy to hold and can be opened and closed easily. The packaging is popular amongst consumers because of its functionality and the flow of the product from the package is excellent. Brand builder (Tetrapak, 2011).

Then the other major competency is the ability to keep the food fresh. Tetra Pak introduced the gable-top shape Tetra Rex which is widely recognized as a dependable solution that offers consumer appeal. Its an easy to distribute, pour and versatile package and its blank-fed solution implies that volumes can be changed in just minutes. The special way the package is folded protects the product from coming in contact with raw paper and the raised seal at the bottom of packaging gives stability and moisture resistance (Tetrapak, 2011). The packaging has a trust of generation of consumers who value and prefer the shape and perceive it as a symbol of convenience, freshness and safety. The product can be protected with four barrier materials, including light protection that keeps milk and dairy product fresh and plastic and aluminum barriers that protect oxygen-sensitive products and juices. Another competency that Tetra Pak has is that it has a packaging system that makes it doable to sterilize food products such as tomatoes, vegetables, pasta sauces and ready made meals inside the carton package (Guardian.co.uk, 2011). Since the food industry is constantly evolving and consumers, retailers and food manufacturers are seeking fresher, fitting food packaging solutions that have a minimum impact on the environment. Also the consumers want foods that are easy to prepare and Tetra Recart is a product that makes consumers life simple and giving them more time to relax. It was the first carton package in the market to sterilize foods with particles of any size directly in a carton package. Now Tetra Pak has hundreds of product references in over 30 countries and it is providing solutions for today and tomorrow. Tetra Recart is an innovative and modern packaging system and the first retortable carton package which is designed for shelf-stable products conventionally filled in glass jars, cans or pouches (foods like beans, tomatoes, vegetables soups and sauces and also pet food). Food stays fresh for up to 24 months if it is kept under Tetra Recart.

Essentially it is a result for meeting up the 21st century consumers demands for convenience, safety and environmental performance. Tetra Recart packages can not only be recycled in existing carton waste streams but can also carry the FSCTM logo for on-pack communication. This packaging delivers key benefits along with value chain, such as strong environmental performance, cost efficiency and added convenience. It needs less space for transportation and it has great environmental savings too.

Bibliography

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European Consumer Book www.euromonitor.com/consumer-europe-2011/book [Accessed 1/8/2011].

Guardian (2011) www.guardian.co.uk [Accessed 2/8/2011].

Tang, Y (2011). Multi-Flavored Price War http://www.bjreview.cn/EN/200432/Business-200432(B).htm [Accessed 3/8/2011].

Tetra Pak (2011) www.tetrapak.com [Accessed 1/8/2011].

Wilmott, M (2011). Consumer Trends Across Europe visionarymarketing.com/_repository/wanadoo/.../html/image1.htm [Accessed 1/8/2011].