2010 Alara Agri 市场分析营销的英文案例分析.docx

A Marketing plan for Alara Agri20102010-1-16Executive SummaryAlara Agri is one of the largest international cherry producers in the world. It is committed to provide the top quality products in comply with the safety standards in the most competitive cost structure. Alara Agris goal is to be the “Global Leader” in the fresh cherry sector. Therefore, we need to improve the quality of our cherrys over time and increase consumers awareness on Alara Agris products. In order to upgrade the value chain, the CEO, Kerim Taner decided to market our cherry products in attractive packages and also to print companys logo on it. By doing so, it is expected to increase the sales revenues and significantly reduce the cost of wastage which in return will improve the profit margin. However, the retailers resisted to take changes. A detailed marketing plan is formulated to persuade the retailers to support our strategies.The marketing plan includes four major parts. The first part will be a brief introduction on the company history and the cherry business. The second part will be the market research and analysis including segmentation analysis and market targeting. The third part will the market testing plan including our 4 “P” strategy, the fourth part will be the financial analysis and the final part will be the conclusion on the marketing plan.The marketing plan is useful in helping us to analysis the problem and gain more insight on how consumers will response to our strategy in branding and packaging strategies. We are expected to convince retailers by our marketing plan and so our new marketing strategy can be implemented with full cooperation from the retailers and the marketing plan will also serves as a guideline for us to carry out actual marketing activities. Alara Agris company history and businessAlara Agri is located in Bursa, Turkey and was founded by Yavuz Taner in 1986. Three years later, Yavuz Taners son, Kerim Taner joined the company and became the CEO later. The company is the largest fresh cherry and fig exporter in Europe. Alara Agris products are distributed to major retailers in many countries such as Belgium, Germany, Turkey and United Kingdom. Alara Agris major business is growing, packing and exporting cherries. To ensure the supply of high quality cherries and prolong the harvest season, Alara Agri owns hundreds of hectares of cherry orchards in 4 different regions, the Bursa plantation, the Cannakkale plantation, the Eskisehir plantation and the Manisa plantation. By using modern pruning and better fertilizer, Alara Agris cherry can grow to 26 to 28 mm in diameter; it is large, juicy and has better coloration. In 2003, Alara Agri exports 6,613 of tons fresh cherry from Turkey to other countries and the companys total revenue has doubled from $15 million in 2000 to million $31 million. Although there were more than 1000 percent grow in revenue over the past 10 years, Alara Agri is continuously seeking ways to improve its sales volume, products quality, cost efficiency and also Alara Agris brand familiarity. In order to increase the consumers awareness of Alara Agris brand, Kerim Taner is intended to have a brand promotion strategy to and also to change the packaging and price of the cherry product. Background informationAlara Agri is currently supplying fresh cherries to Belgium, Germany, Turkey and United Kingdom. Previously, cherries were distributed in 5 KG boxes to the retailers and then the retailers will let the consumers to select their own cherries on the basis of color and size. Later, Alara Agri supply cherries packaged in smaller bags or punnets to UK consumers. Smaller packages is more convenient and looks healthier because it is more hygienic, therefore, it is preferred by the consumers in United Kingdom. Besides, the retailer also required Alara Agri to pick medium and larger cherries (greater than 26 mm in diameter) with strict coloration guidelines. The CEO Kerim Taner found that by providing better quality cherries in smaller packages, the retailers can actually reduce the cost of waste from 18% to 3% and improve the profit margin from 10% to more than 25%. In order to improve the margin of the value chain, Kerim Taner decided to provide the cherry with carry bags and to use their own brand name Alara Agri. However, retailers resist selling carry bags packaged cherries because they thought that consumers like to select their own cherries according to their own preferences. Others argue that consumers are more price sensitive for the cherries. Therefore, the objective of our marketing plan is to convince to retailers that:1. Using Alara Agri as brand name for cherry products will increase consumers awareness on the product.2. Changing to new packages will actually improve retailers profit marginMarket research and analysisProduct level analysisThe value of cherries can be separated into three levels which are used to target three different market segments, the value segment (15% of market share), normal segment (75% of market share) and high-end segment( 10% of market share). The value segment has smaller cherries with approximately 22mm to 24mm diameter; the price for value segment is on average US $4.88 per kg. The normal segment has cherries size from 24mm to 26mm diameter; the average price is USD $6.52 per kg. The high-end segment has lager cherries with size approximately 26+mm; the average price is US $9.78 per kg. After the product segmentation, we find that the UK retailers had a high profit return because they were selling cherries at high-end market which is generally expected to have higher profit. Nevertheless, the result didnt explain the whole picture yet. Surely, the use of smaller packages also played an important role to boost the profit margin. Comparing the margin of cherries in carry bags and loose bulk by using the data provided in Exhibit 8. The net retailers margin of 1 kg cherries in carry bags and loose bulk was 37.2% and 30.1% respectively, 7.1% higher profit margin for the well packaged cherries. Therefore, we conclude that there is a large potential profit which we can capture by using packaging.To be more convincible, we also do the cost and benefits analysis. The cost of 1 kg cherries in carry bags and loose bulk were USD $ 4.98 per kg and USD $ 4.09 per kg, USD $ 0.89 per kg higher for the well packaged cherries. If we compare the retail price, the retail price of 1 kg cherries in carry bags and loose bulk was USD $8.13 and USD $6.77 respectively, USD $1.36 higher price for well packaged cherries. In addition, the well packaged cherry was able to reduce the cost of waste from 18% to 3%. The benefits of using new packages will certainly outweigh the cost from the retailers position.Consumer level analysisThe retailers in Belgium and Germany were worried that consumers liked to select their own cherries according to their own preferences and they are price sensitive. Their arguments were true in some sense because they are the forefront sellers who had direct contacts with the consumers. However, it is not totally true because just as we have found from the above analysis, there was higher profit margin for packaged cherries. It was potentially unidentified values which we have to understand it from the consumer side. The cherry consumers are price sensitive because cherry is a luxury fruit and generally more expensive than the ordinary fruits due to its short seasonal harvest period. Therefore, cherry normally didnt come to consumers shopping list. Consumers who bought cherries were refer as impulse purchase. They bought it because they were attracted by its freshness, color and special taste. By using carry bags packaging, it is very useful to protect the flesh of cherrys fruit, and taste and help to extend its shelf life to 30 days. The color of the cherries will also be preserved to show the freshness of the cherries and therefore, the consumers will be more eager to buy. Since cherrys fruit is too soft and can be easily crashed and damaged during the transportation process. Besides, when it is sold in bulks, the consumers will always pick the larger one first and the remaining cherries would have to be sold in much lower prices. After several consumers put their hands on cherries, the cherry shelf will become a mess and the late comers will not purchase them because of the hygienic problems. Studies showed that by using packages, it will give consumer an impression of healthier products. Consumers are paying higher price premiums for the packaged products (net of cost) not because the cost is higher, but because they are willing to pay more and they perceived more values in the well packaged and healthier products. Supplier level analysisAlara Agri is currently the largest cherry producer in Turkey. It has a major competitive advantage since it is located in Turkey and Turkey was the largest cherry producing country (13.4% of world total) in 2003. Turkeys landscape was ideal for cherry growing and the perfect climate condition allows cherries to be harvested at different stages, from mid May to the end of July. In addition, labor cost in Turkey is also very low. All these factors make Alara Agri very cost competitive.However, average export price of United States was much higher than Turkey, for United States was USD $3,781 per metric ton and Turkey was USD $2,354 per metric ton. The reason was because U.S. exporters have better brand name and consumers perceive their products were in higher quality. The following figure showed that the export volume for U.S. and Turkey was 45391 metric tons and 32688 metric tons respectively. For United States the export value was USD $171,615 million and Turkey is only USD $76,944 million. As we compared it by percentage of world market share, United States exporters captures 41.57% of the worlds cherry market and Turkey only captures 18.64% of the world market (see Fig 1 and Fig 2). Fig 1 Fig 2In order to increase the market shares and become more price competitive, Alara Agri has to improve the quality of production over time. Kerim Taner has been improving the quality of production by establishing orchards, building mobile hydro cooler, building 5,000 square meter central packing facility and opening nursery to do experiments on pruning and growing techniques. The next step would come to designing new packages and developing Alara Agris own brand name. Marketing TargetingOur major target market will be the consumers from normal segment and high-end segment and ignore the value segment. It is because value segment was only 15% of the total market and the profit margin for value segment was very low. The normal segment and high-end segment consist of about 85% of the total market and the profit margins for these two segments were much higher, ranging from 25% to 35% accordingly. Consumers in these segments generally comes from mid income level and high income level families and they are more likely to accept cherries in the luxury carry bags and willing to pay a higher price.Market testing planOur marketing test plan consists of a marketing mix of 4 P strategies, the product, price, place and promotion. It is designed to upgrade our products value chain by using new packages and adding companys brand names on the packages. The marketing plan will be tested for one month to collect enough data for analysis and to eliminate bias. We are expected to get exact customer responses for our products, including packaging, product quality, taste and also the branding strategy. All these information will be collected with the help of local retailers and shoppers and in return we will offer them attractive price discounts. Product strategies: switching to smaller packaged bagsOur general idea is to pack cherries into smaller transparent packs so it will look fresher, more hygienic and easy to take away. In order to test the market, we will switch the 5-kg boxes to three types of smaller grab packs with 500g each pack, 400g each pack and 300g each pack. Smaller packs are expected to be easier accepted by the consumers, because consumers tend to buy smaller packs on trial basis. Transparent grab packs will be used to pack cherries for normal consumer segment and small transparent punnets will be used for high-end consumer segment because plastic punnets look more high class and can provide more protection to cherries in case consumers touch them. In general, the normal packages will contain cherries size from 24mm to 26mm diameter and the high-end packages will contain a percentage of lager cherries with size 26+ mm and 28+mm.Price strategy: cost plus price strategy and market skimming price strategyFor normal packages products, we will use cost plus strategy since we know that the potential return on the cherries packaged in transparent packs is limited. If we charge too high price, then consumers will not be able to afford it, on the other hand, if we charge a low price to penetrate the market, then consumers perceived value on our products will be affected. Therefore, cost plus strategy will be the proper way for testing the normal market segment. Besides, we will use market skimming strategy to test the high-end consumers because consumers perceived value on our products is still undefined. Another reason is that high-end consumers are more affordable and they are willing to pay more for products which satisfy their needs. For simplification, we will illustrate the price of our products on 1 kg parity. Our suggested average retail price for normal consumers products will be USD $7 per kg and average retail price for high-end consumers will be USD $8.8 per kg. The producers selling price will be USD $3.38 per kg for normal products and average price for high-end consumers will be USD $4 per kg for high-end products.Place strategy: a total of 60 randomly picked stores in both Germany and Belgium. We are aimed to pick 60 stores out of a total of 5747 stores randomly from our four retailers in both Germany and Belgium as test sites. We limited our number of testing sites to about only 1% of the total stores since we dont have much fund for doing the marketing test. Besides, in case of any unexpected results happened, we can withdraw our plan quickly without causing any significant damages to our relationships with the retailers. We decided to test in both countries since from the demographic information weve got, the mid income level of two countries were not the same, therefore, they may refer to the different consumer groups (still need to be confirmed). The mid annual income level on average for Germany was around EUR $20,396 while the mid annual income level on average for Germany was around EUR $ 17,838. Therefore, we will test Germany market with our high-end product first and test Belgium market with our normal product first. Promotion strategy: increase the consumers awareness on healthiness of Alara Agris cherryThe companys brand name Alara Agri should be printed to increase consumers awareness on Alara Agris products. Because of the limited budget, the promotion on major TV or magazines will be out of choice. Nevertheless, by using one page information sheet and pamphlets to describe how healthy Alara Agris cherry is and how the cherries were picked, hydro-cooled and packaged will also improve consumers awareness on Alara Agris products. The emphasis on Turkeys natural growing conditions and details about the physical attributes of the cherry such as its green stems will improve consumers perceived value on the quality of Alara Agris products. The leaflets and pamphlets may have a lower coverage rate, however, it has a higher reach rate for the ultimate consumers and the information will stay longer time and people can read it in detail. Besides, we will also ask the store managers to motivate their staff to sell Alara Agris products because its lovely, healthy and also easy to take away.Financial analysisOur break-even analysis will be focusing on the cost incurred and returns that will generate by the new marketing plan. Fixed cost: The new production line was estimated to cost USD $ 2millionVariable cost: The unit cost of producing 1 kg for normal cherry with grab packs is about USD$ 2.78 and for h