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BSB 126 MARKETING PLAN
NAME: GABREILLA MCSWEENEY STUDENT NUMBER: N9422765
TOTAL WORD COUNT 1,649
I. Situation Analysis
Lewis Roads Chocolate Milk has taken the New Zealand market by storm by launching a
quality natural milk product by forming the “perfect marriage” between Lewis Roads full
cream milk and Whittaker’s 5 Roll Refined Milk Chocolate to enhance the flavour and taste
beyond anything else in today’s market (Astley, 2014).
Lewis Road intention is to launch and establish their Fresh Chocolate Milk product in
Australia.
The Key Macro Environment factors for this product are demographics and social trends
with competitors being the most influential macro – environment forces to be considered.
Demographics allow comparison between generational cohorts, gender and income allowing
Lewis Road to easily identify and target their specific audience. Social trends shape
consumer values and influence the purchasing decisions of the individual. By understanding
their customers’ social trends, Lewis Road is provided further insight into their customer
base and future product consumption and development. Appendix 1 shows milk sales by
type (million litres) over a number of years. The trends for flavoured milk have been
upwards with fresh flavoured milk increasing from 7% to 10%. (Dairy Australia , 2014)
The Flavoured Milk Industry in Australia consists of many brands of flavoured milk. Lewis
Road will need to consider this extensive competition when entering into the milk industry in
Australia. When reviewing competitors, Lewis Road must consider price, packaging, flavours,
size and varieties. Appendix 2 highlights the Flavoured Milk Industry competitors currently in
Australia.
Appendix 3 is the SWOT analysis that was conducted and revealed a variety of strengths,
weaknesses, opportunities and threats for the introduction of Lewis Road Creamery’s Fresh
Chocolate Milk to the Australian market. One of the major strengths is that Lewis Road has
combined with Whittaker’s Chocolate. Both companies are well known and provide quality
premium products. A major weakness is that Lewis Road only has one flavoured milk
available at present. However, this presents an opportunity for further development of milk
flavours. Another weakness is that Lewis Road has previously struggled to keep up with the
customer demands for their chocolate flavoured milk.
II. Marketing Goal
To attain 15% market shares of Lewis Road’s Creamery Chocolate Milk the Flavoured Milk
Market, in Australia within two (2) years of launching the product.
III. Marketing Strategy
Target Customers
The Flavoured Milk Industry target market has historically been males aged 18 to 24 years
(WordPress, 2012). Lewis Road produces premium products aimed at a niche group of
sophisticated and older people in New Zealand (Freya, 2014) . By considering quality over
quantity, Lewis Road Creamery is confident the drink will appeal to people who do not
consider themselves drinkers of flavoured milk and will offer a more sophisticated and
natural range of flavoured milk (FMCG, 2014). This drink will appeal to people who do not
consider themselves drinkers of flavoured milk because it is made from New Zealand’s
organic milk. The milk is permeant free, Palm kennel expeller (PKE) Free and then combined
with real and rich chocolate unlike most flavoured milks. A lot of milk companies add
permeant free back into their milk which essentially waters it down, customers want their
milk to be as close to the product which comes out of the cow as it can be, and that is what
Lewis Roads fresh chocolate milk achieves (Wendyl, 2014) .
For Lewis Road Creamery’s Chocolate Milk to be a success and for them to meet their goal,
the target market for Lewis Roads Fresh Chocolate Milk has to be segmented to focus on a
particular market. Table 2 below displays the target customer profile for Lewis Road
Creamery’s Chocolate Milk.
Table 1: Target Customer profile for Lewis Road Creamery’s Chocolate milk
Gender Female
Age/Demographic 27-35 years
Geographic Brisbane, Australia
Occupation Mother- working professional
Hobbies Enjoys cooking, lifestyle shows and social
media
Marital & Family Status Married with Children
Status Middle class
Income Higher income
The segmented market for Lewis Roads Chocolate Milk is primarily white collared
professional females aged 27-35 years earning a higher income with their children being the
secondary market. Since the chocolate milk is sold at a premium price, children and
teenagers may not be able to afford the milk themselves but by targeting mothers they
provide a spin off to the other products as well as increasing the volume of sales. Many
females in average households are keen to purchase a Dairy product they think is a superior
quality. It can be seen as a family treat or be given to guests or used for cooking.
Value Proposition
Lewis Roads Chocolate Milk is the best product for mothers searching for a quality product
for their family as it offers a superior flavour without the additives and excessive processing
found in Moove flavoured milk. Moove consists of added sugars and cocoa powder instead
of chocolate.
Positioning statement = Combined with Whittaker’s’ 5 Roll refined creamy milk chocolate,
Lewis Road Creamery delivers a delicious velvety chocolate milk like no other available
within the Australian market.
Lewis will be the first in the market with these benefits and therefore gain an advantage
(Grewel, 2015, p. 276).
Despite the fact Lewis Roads Chocolate milk will be more expensive than Moove flavoured
milk, customers will be willing to pay more because they recognise the product consist of
real chocolate and premium milk.
Lewis Roads Organic Jersey Milk is the first 100 percent Jersey milk to be available. Jersey
milk is renowned for being richer and creamier in taste and texture as well as an organic
whole milk that is free from permeate and palm kernel expeller. It delivers a top quality
product that surpasses standard milk with the benefit of being a healthier choice (Scoop
Media , 2013). Both the primary and secondary target markets would benefit from this as
females are often health conscious and in search of an alternative for their children from the
unhealthy processed milks currently on the market. The target customer perception of Lewis
Roads Chocolate Milk and Moove’s Chocolate Milk is represented in figure 1.
Figure 1 Perceptual Map of Lewis Road Creamery’s Chocolate Milk and Moove Chocolate
Milk
Price
(Low)
Price
(High)
Flavour (Processing – add in products)
Flavour (Natural ingredients)
$3.20 = 600ml
$2.55 = per L
$3.78 = per L
$3.69 = 300ml
$6.49 = 750ml
IV. Marketing Tactics
Product
Lewis Road will launch with a 300ml and 750ml bottle in fresh Chocolate Milk flavour (Astley,
2014).
In order for customers to have variety, new flavours will need to be established. By
producing and introducing more flavours Lewis Roads customers will have a wider range of
choice and future sales will increase. To develop their flavoured milk range they will need to
consider current competitors range and expand their premier quality range. Further flavour
development would enable Lewis Road to explore compatible companies with natural
flavours as undertaken with Whitakers. Co-branding could be explored with Capilano to
combine Australia’s favourite honey to create a natural quality flavour like their chocolate
flavour (Grewal, 2015, p. 253).
Price
The pricing strategy for Lewis Roads Chocolate Milk is crucial. It is built around the 5 critical
components of pricing including competition, costs, company objectives, customers and
channel members.
The current cost price will need to be monitored to ensure that profits are retained whilst
maintaining a quality premium price point. Enhanced by quality flavours the product will
remain in the niche high end market. This pricing structure is essential for further
development of high end flavours sourced throughout Australia. Current pricing also aligns
with the company objectives of maintaining their products as “tastes like nothing else on the
market”. This would be impossible if they resorted to cheaper additives and flavours. Though
there are brands like Norco and Maleny Dairy that offer quality milk at higher prices, Lewis
Road offers a superior product with a more sophisticated look. Accordingly it will be sold in
300ml for bottles for $3.69 and a 750ml bottles for $6.49 (Astley, 2014).
Distribution
In New Zealand Lewis Roads currently distributes their fresh chocolate milk through the
major supermarket chains and speciality grocery outlets. in New Zealand. They also supply
the product through a national fuel station company.
In Australia, Lewis Road will intended to follow the similar distribution system that it has in
New Zealand and will look to distributed their chocolate milk via the major supermarket
chains in Australia being Coles and Woolworths. It will also to distribute the product at
higher end groceries such as the Standard Food Market Company that supplies high end top
quality produce (Must do Brisbane , 2014).
In the initial stages, the product will be shipped in bulk from New Zealand and packaged in
Australia. Once sales of the product reaches a target level, Lewis Road will then look to
engage an Australian processer to make the product or will look to establish their own
processing facilities in Australia.
Promotion
The promotion objectives for Lewis Roads Chocolate Milk are to be able to sell the chocolate
milk in Australia and gain a greater customer base whilst keeping up with customer demand.
Lewis Road has AUD$ 50,000 to spend on an integrated marketing communications (IMC)
plan in order to achieve the promotional objective (Grewal, 2015, p. 424). Lewis Road must
employ a variety of marketing techniques to ensure the right message is communicated
through the right medium and to the right audience (Olenski, 2014). Table 2 provides an
example of the objective and task method that Lewis Road will use for their Chocolate milk.
Table 2: Objective and Task Method for Lewis Road Creamery’s Chocolate Milk
Objective Task Media Cost
For Lewis Roads to be able
to sell their Chocolate Milk
in Australia and gain a
greater customer base
whilst keeping up with
customer demand
Negotiate with Woolworths
to advertise a point of sale
display in 25 stores to have
free taste testers for
customers to taste and also
have bottles for purchase
available to customers.
Cost per store - $2,000
The advertising method is both a pull and push strategy. By using this form of advertising it
will be informative advertising for Lewis Road Creamery and customers. It will help create a
level of brand awareness whilst moving the consumer through the buying cycle to make a
purchase (Grewal, 2015, p. 435). By having free sample taste testers it uses persuasive
advertising to motivate consumers to try the product before they purchase and therefore
help influence their purchasing decisions. It will also allow Lewis Road to judge how
consumers in Australia respond to their chocolate milk compared to consumers in New
Zealand. The above task will be complimented with a national media commercial that will
reach a wider customer base.
V. References
BibliographyAstley, M. (2014, October 30). Lewis Road Creamery ups choclate milk production 4000%
after 'unprecedented demand'. Retrieved April 27, 2015, from DairyReport.com: http://www.dairyreporter.com/Manufacturers/Lewis-Road-Creamery-ups-chocolate-milk-production-4000-in-a-month
Australian Bureau of Statistics. (2011). Family Composition by income comparison for parents/partners. Retrieved May 2, 2015, from Australian Bureau of Statistics: http://stat.abs.gov.au/Index.aspx?DataSetCode=ABS_CENSUS2011_T26
Capilano, Australians Favourite Honey. (n.d.). Australians Favourite Honey. Retrieved May 2, 2015, from Australians Favourite Honey: http://capilano.com.au/
Dairy Australia . (2014). Drinking milk sales. Retrieved May 2, 2015, from Dairy Australa : http://www.dairyaustralia.com.au/Markets-and-statistics/Production-and-sales/Milk/Drinking-Milk-Sales.aspx
FMCG. (2014, September 29). A match made in heaven. Retrieved April 27, 2015, from FMCG Business: http://www.fmcgbusiness.co.nz/2014/09/29/match-made-heaven/
Freya. (2014, October 19). Liquid Gold: Lewis Road Creamery and Whittakers Chocolate's Co-branding success . Retrieved April 27, 2015, from Freya Hill Eassays about now: http://www.freyahill.com/?p=851
Grewal, D. (2015). Queensland University of Technology Marketing . North Ryde NSW: McGraw-Hill.
le, J. (2014, October 17). Chocolate Milk craze hits Kiwi Shoppers . Retrieved April 27, 2015, from The Australian: http://www.theaustralian.com.au/news/latest-news/chocolate-milk-craze-hits-kiwi-shoppers/story-fn3dxix6-1227093878776
Lewis Road Creamery New Zealand. (n.d.). Chocolate Milk. Retrieved from Lewis Road Creamery New Zealand: http://www.lewisroadcreamery.co.nz/choc-milk
Matters, J. (2014, November 23). Sunday insight: We've all gone chocolate milk mad. Retrieved from The New Zealand Herald: http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11363083
Must do Brisbane . (2014). The Standard Market Company Newstead . Retrieved from Must do Brisbane.com: http://www.mustdobrisbane.com/eat-drink-specialty-foods-gourmet-grocers/standard-market-company-newstead
New milk provides closer to farm gate taste experience . (2013, October 21). Retrieved May 2, 2015, from Scoop Brisbane Independent news: http://www.scoop.co.nz/stories/BU1310/S00725/new-milk-provides-closer-to-farm-gate-taste-experience.htm
Olenski, S. (2014, October 14). 5 Inexpensive Ways to Promote A Product Launch . Retrieved from Forbes: http://www.forbes.com/sites/steveolenski/2014/10/14/5-inexpensive-ways-to-promote-a-product-launch/
Scoop Media . (2013, October 21). New milk provides closer to farm gate taste experience. Retrieved May 2, 2015, from Scoop Business Indepent news: http://www.scoop.co.nz/stories/BU1310/S00725/new-milk-provides-closer-to-farm-gate-taste-experience.htm
Wendyl. (2014, November 23). Wendyl wants to know: Lewis Road Creamery Fresh Chocolate Milk $3.69 per 300ml . Retrieved from The New Zealand Herald: http://www.nzherald.co.nz/lifestyle/news/article.cfm?c_id=6&objectid=11362542
WordPress. (2012, April). Pepsico . Retrieved from Product Launch : https://gregoryjhatten.files.wordpress.com/2012/04/product-launch.pdf
VI. Appendices
Appendix 1
Appendix 2 Competitor Analysis
Products Varieties of milk type (E.g. Skim, Full cream etc.)
Company that makes the product
Packaging Size Pricing Flavours
Shake n shake
Full cream, HI-LO and SkimOnly full cream for flavoured milks
Shake n Shake
Milk cartons for flavoured milk
600ml $2.89 -Vanilla-Chocolate – some vanilla added-Choc -honeycomb-Rocky road
Breaka Full Cream Milk
Breaka Milk cartons
300ml500ml600ml750ml1L2L3LSizes varies depending on the flavour
600ml = $2.80 -Chocolate-Iced coffee-Strawberry-Banana-Lime-Caramel latter (limited edition)
Moove Reduced fat milk
Moove Milk bottle and Cartons
600ml1L6 pack 1.2L
$3.20 600ml$2.55 per L$3.78 per L
-chocolate-strawberry
Oak Full Cream MilkSome light milk options and no sugar options
Oak Milk bottles and Cartons
300ml600ml750ml2l500mlSizes varies depend on the flavours
300ml = $1.80600ml = $2.79
-Chocolate-Chocolate light-Iced coffee-Iced coffee no sugar-Strawberry-Vanilla malt-Banana-Egg nog-The max choc mint-The max Molten Caramel-light chocolate- light strawberry-light banana
Dare All full creamExcept raw with no added
Dare Arabica and Robusta coffee
Milk Bottles 500ml 500ml =$2.70 -Double expresso-mocha-expresso-dare raw
sugar, 1% fat
Iced Coffee
Reduced Fat
Farmers Union
Milk Cartons
600ml $3.30 -coffee
Ice Break
Full creamNo added sugar milk
Ice Break Bottles 500ml750ml1.25L2L
500ml= $3.00750ml = $3.80
-ice break-ice break no added sugar- ice break loaded-ice break extra shot
Rush Low fat milk - 99% fat free and 30% less sugar
Rush Bottles 500ml 500ml = $3.09 -iced latte-iced chocolate-iced vanilla malt-strong iced coffee
Just Natural
98% fat free
Pauls Bottles 500ml 500ml = $2.95 -malt, honey and chocolate-iced coffee-banana and honey
Mighty Cool
Low in fat(easy for children over 3 years)
Norco Pop top plastic bottles
250ml 250ml= $1.78 -strawberry-chocolate
Classic Full cream milk
Dairy Farmers
Bottle 300ml500ml2L
500ml = $2.20 -chocolate-strawberry-Iced coffee
Appendix 3 SWOT Analysis
Strengths Weaknesses
Lewis Road Creamery flavoured milk is
more expensive per unit therefore
creating a niche market
Lewis Road Creamery and Whittaker’s
chocolate are both well-known and
respected companies
Launch of the Chocolate milk product
follows the successful introduction of the
brand’s award winning premium butters
in 2012 as well as artisan butter and
organic milks and creams in 2013
Fresh Chocolate Milk comes in 2
recyclable sizes 750 ml at $6.29 and 300
ml at $3.59
Due to the fact Lewis Road Creamery has
combined with Whittaker’s Chocolate,
both companies will be able to advertise
the product which will enhance
advertising and distribute costs
Stock shortages have already been
experienced in NZ
Consumers in Australia may prefer to
support local dairy industries and may
not wish to buy this product
Lewis Road Creamery may need to
consider changing their price structure
for Australian consumers who may be
unwilling to pay premium prices for
flavoured milk
Potential increased costs and overheads
of shipping the product and packaging in
Australia may not be worth the added
costs and eventual profits
Health conscious people may be less
inclined to purchase the product due to
the full fat content of the product
The product is only available in 1 flavour
at present
This product is more expensive than the
flavoured milks already being sold in
Australia
Opportunities Threats
Investigate future possibilities of on-line
bulk selling for the product
Opportunities for first mover advantage
in the flavoured milk industry as a more
Cost competitiveness could be
problematic as the majority of brands
within the Australian flavoured milk
industry are based on commodity
prestige quality product
Establishment of the product in an
overseas market may increase the
likelihood of sales for the company’s
existing and future products e.g. butter,
ice-cream
Consider making the Fresh Chocolate milk
in different flavours and also in a low fat
milk form
Customers who develop loyalty towards
the new Fresh Chocolate Milk will be
excited about the prospects of new ice-
cream products that are to be developed
As Lewis Road Creamery would be
targeting the Australian market there will
be a larger consumer base
pricing.
Brand loyalty already exists to a number
of brands in the flavoured milk portfolio.