Cocola Noodle Marketing Strategy in

Bangladesh
Group 1 :
1. Agung Dwi Saputra 2006552344
2. Dimitri Ismandana 2006552905
3. Dwi Riani Novitasari 2006552981
4. Imam Rafif Hanif 2006553334
5. Kana Agatha N 2006553486
6. Kemal Yudha P 2006553504
7. Septiany Trisnaningtyas 2006500031
8. Simon Maruli 2006554343
 MANAGE MARKETING
CH. 11 CHANNELS AND POINTS OF
CUSTOMER INTERFACE

Cocola Noodle Marketing

Strategy in Bangladesh
 Cocola Noodles Value Network

1
Traditional advertising approaches
(Network Organization)
Network firms usually formalize Rewarding retailers, offering higher
contracts with suppliers, commissions than competitors. it has more
distributors, and other important than 200 distributors in all 64 districts
partners to contribute the around Bangladesh
aspects of the value chain those
entities do best, then draw on 2
their own internal capabilities to Expensive advertising approaches
focus on core internal sources of 3 (Virtual Organization)
value Occasional placement of TV and radio
(Marshall,2015) advertisement
Cocola Noodles Value Network (2)

Traditional advertising approaches (Network Organization)

Senior management at Cocola Noodles, still believed traditional promotional
operations that are commission-based are the most important way to promote
and run the business. The company is estimated to rely on over 200
distributors throughout the country, an extensive distribution channel that
Cocola Noodles must pay a commission between 7% and 8%for as it pursues
its push strategy.

Expensive advertising approaches (Virtual Organization)

● Cocola Noodles official website (http://www.cocolafood.com/)
● Social media presence: Facebook
● Cocola Noodles placed commercials on private broadcasting channels
(the Cartoon Network and Star World) and posted billboards
Cocola Noodles Intermediaries

Distributors play a vital role in breaking bulk and supplying

Cocola Noodles products throughout the country, it has more
than 200 distributors delivering in all 64 districts around
Bangladesh

Cocola Noodles must follow a system of rewarding Retail

Outlets through higher sales commission and discounted
product offerings for bulk sales.
Cocola Noodles Intermediaries (2)

A direct channel, portrayed as the first

example in each exhibit, has no intermediaries
and operates strictly from producer to end-user
consumer or business user.

An indirect channel contains one or more

intermediary levels, as represented by all the
other examples within each

Cocola Noodles has no other direct contact

with its customers (this mean that they use
an indirect Channel)
Function of Channel Intermediaries
Physical Distribution Functions :
1. Breaking Bulk
2. Accumulating Bulk and Sorting
3. Creating Assortments
4. Reducing Transactions
5. Transportation and Storage

1. Distributors play a vital role in breaking bulk (goods are marked for individual
distributors that have to be loaded and unloaded at specific volumes at each point
of transfer) and supplying Cocola Noodles products throughout the country.

2. Warehousing and transportation are provided mainly by the distributors. Though

Cocola Noodles has its own warehouses, their inventory management is not very
sophisticated.
Function of Channel Intermediaries (2)
Transaction and Communication Functions:
1. Selling. Often, intermediaries provide a sales force to represent a
manufacturer’s product line.
2. Buying. Both wholesalers and retailers perform an important function by
evaluating products and ultimately simplifying purchase decisions by creating
assortments
3. Marketing communications. Intermediaries frequently receive incentives from
manufacturers to participate in helping promote products in the channel

In Cocola Noodles, Sales representatives working under distributors take orders when they
visit stores once a week on average (in Dhaka) and then deliver the products in two to three
days. (Selling Function)

Notably, Nestlé has built a profitable partnership with distributors by placing Maggi
advertisements on distributor vehicles (Marketing Communication Function)
Disintermediation and E-Channels

Driven largely by the advent of electronic commerce and online marketing,

disintermediation, or the shortening or collapsing of marketing channels due to
the elimination of one or more intermediaries, is common in the electronic
channel (Marshall, 2015)

Senior management at Cocola Noodles, still believed traditional promotional

operations that are commission-based are the most important way to promote
and run the business.

In terms of contemporary advertising and outreach strategies, CN’s official

website (http://www.cocolafood.com/) is still under construction, which limits the
company’s ability to educate customers.
 VERTICAL MARKETING SYSTEMS

Vertical marketing
system (VMS) consists
of vertically aligned
networks behaving and
performing as a unified
system.
 CHANNEL BEHAVIOR: CONFLICT AND
POWER

Channel power is the degree to which

any member of a marketing channel
can exercise influence over the other
members of the channel

Channel conflict - can occur in which

channel members experience
disagreements and their relationship
can become strained or fall apart.
VMS, CHANNEL BEHAVIOR: CONFLICT AND POWER
- COCOLA NOODLE

Vertical Marketing System

Even though it is not explicitly stated, it is explained that CN has more than 200 distributors for supplying its products
throughout the country. Its distributors have role in breaking bulk of CN products to the retailers. With assumption CN and its
distributors are bound through contractual agreement, the VMS system that is implemented is retailer cooperative that is an
example of contractual systems.

The case, however, does not mention any conflict or disagreement between channel members that might cause their
relationship strained or fall apart. The case also does not mention any sources from any member channel that can influence
the entire channel. Hence, the power sources is not analyzed.
 SELECTING CHANNEL

COCOLA NOODLE
Cocola Noodle uses intensive distribution (a strategy that is designed to saturate every possible intermediary and especially retailer)
through two supply chains: business to business; and business to consumer, it is mentioned that CN has more than 200 distributors. CN
uses push strategy as its distribution channel. This strategy means that much of the intensive promotional activities take place from the
manufacturer downward through the channel of distribution. Through the push strategy the company offers more discounts and financial
incentives to its distributors that can be seen in table 2 case document. .
 LOGISTICS ASPECTS OF SUPPLY CHAIN
MANAGEMENT

Outbound logistics - internal flow going

one direction

Inbound logistics - sourcing materials

and knowledge inputs from external
supplier to the point at which production
begins

The case does not specifically explain about CN supply chain

Reverse logistics - how to get goods management, however, several aspects in supply chain for its
back to manufacturer or intermediary distributors are stated. Hence, the analysis will also be
after purchase explained also from its distributors’ perspective
LOGISTICS ASPECTS OF SUPPLY CHAIN
MANAGEMENT : COCOLA NOODLE

Transportation of product to customers is also

provided by distributors.

Sales representatives working under distributors take orders when they

visit stores once a week on average (in Dhaka) and then deliver the
products in two to three days.

It is mentioned that warehousing is provided by the distributors, though CN

has its own warehouses

The case does not mention any ordering process from CN’s production.
 Legal Issues In Supply Chain Management

Three key legal issues related to distribution

Exclusive Dealing Exclusive Territories Tying Contracts

An arrangement where Protects intermediaries from having Intermediaries are required to
intermediaries are prohibited to sell to compete with others selling the purchase other supplementary
competitor’s products producer’s product within a territory product from the producer

None of these legal issues are mentioned in the case

 RETAILING
Retailing is a business activity of selling goods/services to the consumer; an essential part of the supply chain.

Additional Services to Differences in Value

Customers 4 SPECIFIC Proposition
4 CRITICAL CHARACTERISTICS
FUNCTIONS OF STORE RETAILERS
Maintain Inventory Level Assortment

Offer Variety to Consumers Offer Smaller, Consumer- Type of Merchandise Services to Customers
Friendly Quantities of
Products to Consumer

THE CASE DID NOT GIVE ANY RELEVANT

INFORMATION REGARDING THE RETAILING ASPECT
RELATED TO THE BOOK
https://www.digisystem.com/business/retail
 RETAILING

FOOD RETAILERS
TYPE OF STORE
THE CASE DID NOT MENTION THE TYPE OF STORE
RETAILERS
GENERAL MERCHANDISE RETAILING SELLING THEIR PRODUCTS
RETAILERS

CATALOG RETAILERS

TYPE OF NON- DIRECT SELLING THE CASE USE STORE RETAILERS AND DID
STORE RETAILERS
NOT MENTION ANY NON-STORE RETAILERS
TV HOME SHOPPING

VENDING MACHINE
 E-COMMERCE
https://nasreenalissalaw.com/en/middle-east-legislative-insight-saudi-arabia-e-
commerce-law/

Selling goods and services to customers through electronic media and internet

BUSINESS TO CONSUMER E-COMMERCE BUSINESS TO BUSINESS E-COMMERCE

THE CASE USED STORE RETAILERS TO SELL THEIR PRODUCTS, NOT E-COMMERCE
 Promotional Strategy and New
CH. 12
Media

Cocola Noodle Marketing

Strategy in Bangladesh
 PROMOTION MIX OF CN

Giving Commission Not mentioned in the A setback by CN

to distributors Public case Direct that is not utilizing its
Advertising
Relation Marketing website and social
media optimally for
promoting its
products

Snack for masses:

video that targeted
children and young Not mentioned in the Not mentioned in the
adult; commercial on case case
private broadcasting
channel; Cartoon Sales Personal Interactive
Network and Star Promotion Selling Marketing
World; Billboard
 PROMOTION MIX VS IMC

CN is using Promotion Mix

Decision to create Marketing
strategy plan, CN does not
have Integrated Marketing
Communication to make
decision making
COMMUNICATION PROCESS MODEL

Communication is the
process of exchanging
information and conveying
meaning from one party to
another. Communication
process not really mentioned in
the case
 Hierarchy of Effects Model
Raise awareness & gain attention
Persuasive communication
to inform customers about how a
fulfill customer needs & wants
Sharing experience of it functionality
and form > promotional message
Purchase > sales promotion
Attention
- the first video advertisement targeted
children and young adults CN placed
commercials on private broadcasting
channels
- CN’s officials website & Facebook
- Shelf marketing
-Billboard
Desire & Action =
- Traditional Promotion ;the company is
estimated to rely on over 200
distributors throughout the country
- CN reduced the price of its 62 gram
product by BDT 3.
 Promotional Strategy

Identify the Target Segmentation = Age

Targeting = Children & young adults
Positioning = Through advertising
“the first video advertisement targeted children and young adults CN
placed commercials on private broadcasting channels”
 Promotional Strategy

Establish Goals for

Promotion

-To Inform → advertising

-To Persuade → with promotion/
Reducing price
-To Remind → (does not mention in
this case)
 Promotional Strategy

Select The
Promotion Mix

-Nature of offering = interactive marketing via Facebook

-Stage of the offering in PLC
Based on CN sales and profit CN is in the
maturity stage

-Nature of the Market ( does not mention in this case)

-Available Budget (does not mention in this case)

 Promotional Strategy

Develop The -Rational Appeals = centers on benefits an offering can

Message provide to a customer
(does not mention in this case)

-Emotional Appeals = plays on human nature using humor,

drama, adventure, love, surprise.
(does not mention in this case)

-Moral Appeals = used to strike a chord with a target customers

sense of right or wrong (does not mention in this case)
 Promotional Strategy

Select Media For Through social media (Facebook & Website)

Use in Promotion

Prepare Promotion Objective & Task Method

Budget (Does not
Percent of Sales Method
mention in the
Comparative Parity Method case)

All-You-Can-Afford Method

Establish Measure Determine the success of the promotion plan

of Result ( does not mention in this case)
 Online
New Media
Communication
Decisions

Interactive marketing is an Internet-driven

relationship between companies, their
brands, and customers. Interactive
NEW MEDIA communications encompass a powerful set
of marketing communications tools, it still
must be part of a broader integrated
Social Media
Mobile Growth Change the marketing communications strategy.
Opportunities Conversation
 Cocola

New Media
Online Communication
Decisions - Website Maggi
Presentation
Cocola Noodles’s Official Social Network - Maggi’s
Website
Official Facebook
In terms of contemporary
(active, spending on
advertising and outreach
commercials are
strategies, CN’s official
increasing, continous
website
campaign on social
http://www.cocolafood.com/
media)

Maggi’s social media was

Social Networks - Cocola Noodles’s Official Facebook (fairly liked by over 17.3 million
inactive, no representative from the company responded) people (on last count).
Along with increased
The only social media presence the organization has is on Facebook,
spending on commercials,
which is fairly inactive. New posts appear once every six months.
Maggi was relentless in its
Though the site manager responds to messages typically in a few hours,
promotions on social media.
the page contains only ten photographs, nine ratings, and five
reviews. No representative from the company responded to any of the
reviews. Out of the millions of Facebook users in Bangladesh, the CN site
was liked by only 996 people.
 Advertising, Sales Promotion, and Public
CH. 13 Relations
Cocola Noodle Marketing Strategy in Bangladesh
Advertising, Sales Promotion, and Public
Relations
 Advertising:
Types of Advertising

Institutional Advertising no information given in the case

Pioneering advertising
stimulates primary demand, tends to be
used during the introductory and early
growth stages of the PLC ready-to-eat in two minutes by adding boiling water
Competitive advertising
Product Advertising to build sales of a specific brand, heavily
used during the growth and early
CN promoting itself as a snack for the masses: the first
video advertisement targeted children and young adults
maturity stages of the PLC

Comparative advertising
two or more brands are directly no information given in the case
compared against each other, common
during the maturity stage of the PLC
 Advertising:
Advertising Execution

Slice of Life a family having noodles

Advertising Approach Demonstration how to cook instant noodles

- Working mothers prefer

Lifestyle easy and quick food to
consume and prepare
- University students
prefer convenient food
that is easier to carry
 Advertising:
Advertising Media Types

TV

Radio

Advertising Media Outdoor: Billboard billboard in prominent locations of Dhaka to promote

their cup noodles

Online and Social

Media:
-CN’s official website
-CN’s Facebook
Advertising:
The Role of the Creative Agency

The trend is toward more full-service creative agencies and even

toward integration of marketing planning and branding services
with traditional agency tasks.

Another major trend has been the development of strategic

partnerships between creative agencies and full-service web
builders.

It is mentioned in the case that CN has official

website, TV & Radio advertisement, and
billboard but no information whether those
were built by partnership with creative agency.
 SALES PROMOTION TO CUSTOMER &
CHANNEL MEMBER

Sales promotion was

defined as a promotion mix
element that provides an
inducement for an end-user
Sales Promotion CN consumer to buy a product or
based on 9 Consumer
for a salesperson or someone
Sales Promotion Options
(Exhibit 13.4) else in the channel to sell it.
SALES PROMOTION TO CUSTOMER & CHANNEL MEMBER
“Overuse of sales promotion is not a
good promotional strategy and can lead to a general
cheapening of brand image and distrust by customers”

Strength – Opportunities Strategy (SWOT

Analysis)
CN must be able to take advantage of the
opportunities that exist with its strengths:
- CN have (Bangladesh Standard certification
provided by Bangladesh Standards and Testing
Institution).
-CN is an experienced local business in the
Bangladeshi market, it has more than 200
distributors.
-CN may have a chance to move forward with
suburban and rural customers
-etc
PUBLIC RELATIONS
Public relations (PR) is a systematic approach to influencing attitudes, opinions, and behaviors of
customers and others.

Public relations (PR) Activity on this case :

 SUMMARY COCOLA NOODLE CASE
PLACE
- CN sell their product through local
distributor
- A key selling strategy with food is shelf
marketing. However, CN products are
usually placed on the second or third
shelf and found close to Maggi so
people may mistake CN for Maggi
because of similar packaging
PROMOTION
- CN is using Promotion Mix Decision
- Ineffective interactive marketing on
website and facebook fanpage to
getting potential customer
- CN advertises its product through
private broadcasting channel &
billboard
Suggest a marketing mix strategy that CN might initiate to
respond to pressure from its competition?

PRODUCT PRICE PLACE PROMOTION

-Consider to use prime

Add more flavors to its Prices for CN products space on retailers’ Conduct Interactive
products based on the are already shelves that make the marketing through social
survey they conducted comparatively lower for a products are easily media (other than
packet of noodles than noticed Facebook)
Build exclusive brand competitors such as -Optimizing official Instagram, youtube and
image to differentiate to Nestlé. website to be e- utilizing the existing
the competitors to be commerce platform optimally.
more remembered by the -Partnership with
customers established e-commerce Conduct Personal Selling,
- Integrated CN official Direct Marketing & Public
Facebook Fanpage with Relation to gain Desire &
CN page in established e- Action
commerce
 Discuss why the instant noodles industry has recently faced a
substantial increase in entrants. Describe the cultural and
economic challenges CN faces as a food company in Bangladesh.

Why the industry has faced a Economic Challenges

Cultural Challenges
substantial increase in entrants

The case mentioned that CN as a

Currently, the instant noodles
market has experienced a
rapid growth of 81.25% from
2012 to 2016 (World Instant
Noodle Association, May
2017).
- Shift in consumer tight financial control; it also lacks
preference → instant food,
processed foods
- Disintermediation and e-
channels by shifting
traditional approach to
electronic commerce and
online marketing
local company with limited
resources must operate with
a diversified product portfolio, and
therefore the company is forced to
follow traditional and often
expensive advertising
approaches such as rewarding
retailers, offering higher
commissions (over 25%) than
competitors, with occasional
placement of TV and radio
advertisements.
 How can CN gain competitive advantage in the instant noodles market as compared to its
competitors? What tactics has the company applied already? How effective were these tactics
compared to similar approaches by competitors?

How effective were these tactics

“Competitive CN can gain competitive Tactics that company has
compared to similar approaches
advantage through: applied:
advantage is a by competitors?

firm’s edge over

CN was the first to manufacture
its competitors The first mover advantage
noodles locally
that allows it to We can say that the tactics
have higher sales, were effective as based on
the case, the commercials
higher profits, and Local production means lower helped CN increase market
more customers Cost Advantage production cost and lower price share and brand value. In
offer to the consumer. 2016, the Brand Forum
and enjoy greater Bangladesh annual award
program awarded second for
success year after Best Brand in the snacks
year” (Solomon, category to CN.
CN started to devote marketing
2018) Marketing campaign campaigns to promoting itself as
a snack for the masses.
If you were hired as a brand manager for CN, what new approach
would you have introduced for higher sales? Briefly describe any
innovative ideas that would have benefited CN to sustain and gain
more market share.

1. Build exclusive branding to Cocola Noodle as Local Pride Product (following

the fact that CN was the first to produce noodles locally), expand the scale of
the product survey satisfaction and needs, then innovate with local flavour
2. By looking at the community’s preference to go on social media instead of TV,
we will cooperate with local socialite / influencer to promote the product
through social media and also reactivate then reforming the official social
media/website to communicate with the customers as well as to be a platform
for the customer base