Market Segment Conditions

Question: Analyse the target market segment conditions (e.g. demand and potential, consumer/business buying habits).Describe and analyse the key competitors (preferably 2 most significant ones).Compare and contrast the product or service with the key competitors product or service (e.g. features, packaging, pricing, promotional and advertising methods). Answer: Introduction: Marketing in a business is a very crucial part and revenue is significantly dependent on that factor. International marketing is a much larger concept of marketing where the marketing takes place beyond the geographical location. The multinational organization always aims at maximization of the profit , sales and customer satisfaction. In this marketing plan, the Wilmar International, a Singapore based manufacturer that sells variety of products is trying to intervene the Australian market so that it can acquire a large market share in the edible oil industry. The product it is used for marketing is the packages edible oil and sunflower oil. This report will help in understanding what type of marketing strategy it applies in relation to the competitors in the Australian country. Background: Wilmar International is an Asian food and beverages company that is based in Singapore (Wilmar International, 2016). The company is famous for its production of packaged edible oil so it has decided to enter the Australia for marketing their edible products. There are a large variety of oil produced by the company and is operating in a number of countries. The company is determined to launch packaged edible oil and sunflower oil in the market of Australia. The company after the market research has shown that there are number of benefits that a customer can get from the edible oil produced by them. The edible oil is low in cholesterol and healthy. In order to meet the demand for edible oil in the Australian market it has entered into the country. Environmental analysis The macro analysis is important for any company when it ventures into a different market. Similar is the case with Wilmar International. Wilmar International is a Singaporean entity, which is entirely different from the companies that work in the international market. The political, economical, legal, environmental, social as well as the cultural factors affect the operations of the companies in the Australian market. The political and the economical analysis show that Australia has strong economical background and the political conditions of the country are stable. Hence, it will be favorable for any organization to launch their business in the Australian market. As far as the environment is concerned, the climatic changes in the country and the weather affect the way the companies work in the country. As oil is extracted from nature, hence Wilmar International will have to keep a check on the process that will be required for the extraction. Wilmar International should make extra e ffort to see that the extractions of the oil is not harming the nature is any manner. It has been pointed out the legal changes in Australia might result in the increase of the minimum wages of the workers working in the Australian economy. Thus, while managing the human resource of the organization, it is better to refer to the legal implications of the country then decide on the wages of the workers who will be working for Wilmar International. Other economic and financial factors that will affect the business in the Australian market are the inflation rate, the foreign exchange rate, the tax patterns and the funds available to the organization. All the factors will decide whether a company will be able to launch its business in the Australian economy. The fund available to the organization should be able to match with wages of the workers in the organizations. In other words, the company should be able to hire the workers required for the company. the employment rates will also come into play in such situations. Australia is a developed economy and the rate of unemployment is low. Thus, Wilmar International will have to pay the workers with proper wages so the workers get the interest to work with the company. In addition to this, the tourism industry is one of the strongest industries in Australia. Most of the people are employed in the tourism industry. Thus, Wilmar International will have to keep a check on the wages of the workers of all the industries present in Australia and decide their wages so that they are able to retain the workers. Culture plays an important role for an organization to set up their business in an international location. The culture of the people of a country hugely affects the way the people work in an organization. Wilmar International should also learn the culture of Australia to understand the mentality of the workers. There will be intermingling of culture at the workplace. It will be the duty of the senior managers to understand the culture and promote a sense of well-being in the organization. The way the employees work in the organization will help them to understand the ways they should apply to manage the employees in the organization (Mooradian, Matzler and Ring, 2012). Once the culture of a a place is understood, doing the business in the location will become easier for Wilmar International. Target market and Competitive analysis: The company Wilmar International would be introducing the packaged sunflower oil and edible oil in the market of Australia. Under the marketing concept, the female gender of the age group of 21 to 44 years will be targeted. This shows that the target market is neither too young nor too old. The homemakers and the cooks in every household are targeted. The unique feature of this customer is that they are health conscious and they demand for the refined edible oil. The income of the people within the age group is 3000$ to 4000$. The income justifies they are able to afford the cooking oil that is being marketed by Wilmar International. The level of education within the age group 21-44 has completed their masters degree or has just graduated. The product of Wilmar will be marketed in Western Australia in the city Perth. This is a one of the largest city of Australia and the capital of the Western Australia. This city is ranked as the fourth populous city in Australia with the population of 2.02 million living in the Greater Perth. The city receives moderate to highly seasonal rainfall. The summers are very dry and hot which this last during December until March. The hottest month is during February. During the winter, it is wet and mild and has Mediterranean type of climate. This city is the sunniest capital city in the Australian continent. Psychographic feature would include the lifestyle and personality attributes. Lifestyle of the age group of 21-44 years would be to have healthy food and incorporating quality substances for the cooking the products. The personalities of the individuals vary across the age group mentioned. The level of consciousness increases along the range of the age group. The success and the work relationship are found to increase along the 20s. The people of the 30s have the generous and the warm trait and they are helpful. The 30s age group people also agrees and accepts the changes that comes in their way and this is continued in the age group of the 60s. There are not many differences in the personality among the people of the age group. When looking into the behavioural pattern, targeted segment has different behavioural pattern. The people are sensitive to the changes in the prices of the product. They are going to avail the product only when the price of the product is lower than that of the competitors. The target market they are concerned with the end value of the product. The product is used not for a definite occasion but this is utilised for the daily purpose. The targeted population can get numerous benefits from the use of sunflower and the edible oil. The oil will be lowering the cholesterol, helps in creating new cell structure. It also contains lower saturated fat and higher unsaturated fat. Target Market Segment: In this period of health conscious people, there is a greater inclination towards taking into account the good quality oil with less cholesterol. The people in the city of Perth are educated and knows the consequences of using high cholesterol, enriched oil. The company Wilmar is taking the initiative to improve the quality of oil. There has been a lot of campaigning done so that the effects of cooking oil on heart can be identified. All the advertisement is focused in the health aspect (Chernev, 2012). The urban city is the need for satisfaction and health conscious and the rural or the out skirts of the city they only demand for satisfaction. The educated people they are seen to demand more of the healthy products than the uneducated people in the society. Due to the different behavioural pattern, there has been four variants launched by the company. The four variants are quoted in different prices The urban and the upper middle class tend to consume more of edible oil than that of the rural region. The focus of the company Wilmar was on the people living in Perth City and not on the outskirts. The main reason for this is that people living in the city can only value benefits of the high quality products. The market for the lower income group was unattractive as the per capita consumption is too low and they are not willing to pay a higher price for better quality product or premium brand (Clow and Baack, 2012). There is a strong sense health consciousness among all the age group. More awareness was made among the youths, as they are more concerned about staying fit. Analyse the key competitors and comparison of the product and services: The two competitors of the company Wilmar in the Australian market is the Alba Edible oil and Proteco Oils. Alba edible oil is a producer of high quality edible oil in the Western zone of Australia. It is a private owned manufacturing unit with 40 years of experience in the edible oil industry. Proteco Oil is also a Australian manufacturer of cold pressed oil. The production of oil is based on the Australian produce, which is established for more than 25 years. The sells their produces in bulk and in retail quantity too. Competitor Analysis: Products, Packaging, Pricing Promotion: Alba Edible oil: The main produce are Canola oil, cotton seed oil, rice bran oil and vegetable oil. The liquid oil are packed in the tins, cans and boxes through the Central packaging Control System (CPCS) The liquid oil they are put in the a high quality polythene bag which is wrapped in the boxes. The price of 2 litres of Canola oil is around 7 AUD and price of cotton seed oil is 55 AUD for 20 litres. The promotion is made through the television commercials and newspaper. The online mode of advertising has also been carried out (Glynn and Woodside, 2012). Proteco Edible Oil: The different produces of oil include Almond oil , Olive Oil, Safflower oil , Walnut Oil , Avocado oil and many more . There are different sizes of packaging from one litre to packaging in bulk amount i.e. 10 litre bag in a box, 20 litre drums and tankers. The price of 20 litre of Sunflower oil is approximately 50 Australian dollars. The promotion of the products is done through the website and the local newspaper (Hutt and Speh, 2013). Wilmar International: The bulk amount of the edible oil includes RBD palm oil, palm kernel oil, coconut oil, palm olein and sunflower oil. The oil is packed into eco friendly containers and packets as the company is working towards sustainability. The price range of the edible is going to vary when sold in the country Australia. The company is trying to keep the price of sunflower between 4AUD and 5AUD for a 1-litre bottle. The company is likely to promote the product through billboard displays, advertisements through newspaper and selling samples to the customers (Jolibert, 2012). Target Market entry strategy: When entering into market for targeting the customers in Australias city of Perth located in the Western Australia then the company Wilmar international would be taking up appropriate market entry strategy that is best suited. The option that is faced by the company varies across risk, cost and degree of control they are able to apply. The important strategies decision in an international business involves entering into a foreign market. The target market entry strategy is a planned method through which the services and the goods are delivered to the market that is targeted and distribution of them. The exporting or the importing of the services refers to the managing and establishing of the contracts in the foreign country. When the company Wilmar International takes up the market entry strategy then there are primarily three types of issue that are faced . Firstly, the way of marketing is not decided upon and way of entering into the market. Secondly, the company Wilmar is unable t o understand from where they would be getting their raw materials and Thirdly , is the investment and the control established by the company Wilmar International. The company decides on the type of entry like acquisition , joint venture or global partner. There are a number of market entry strategy that are available are available to the company Wilmar International: Exporting: The exporting form of market entry strategy helps in the marketing of the goods in the foreign market There is no need for direct manufacturing but there is a need for significant amount of marketing. The export response is dependent upon the pressures that is perceived by the decision maker (Keegan and Green, 2013). Franchising: This will help the company Wilmar International to carry out the process of distribution when they act as a franchiser and allows a third party to use the trade mark of the company to operate and the distribute the products to the suppliers. The operator in turn will pay a fee to the company Wilmar International. The business model of Wilmar is practiced in Australia by the third party, which is called franchising. The success of Wilmar International will result from the success of the franchisees (Kotler and Keller, 2012). Licensing: Licensing is a way of given permission to an overseas company to business by letting them use the property for a limited amount of time. The licensing of the property would include copy right , patents, trademarks, formula and the brand name The licensing has been used in the manufacturing sector where the company can use the technology process through up the loyalty (Lee and Carter, 2012). This would be an effective way for the company to finance the international marketing and helps in reducing the amount of risk for emerging the product in the black market The above mentioned strategies suggested are the contractual strategies but there are option of Equity strategies which the company Wilmar International can undertake. Strategic Alliances: This a type of alliance when the Wilmar collaborated with another company so that they are able to achieve a definite objective. The alliance might be short lived or might be for a longer period of time (PenÃÅ'Æ’aloza, Toulouse and Visconti, 2012). Joint Ventures: Joint ventures are formed when there is joint owned separate company established with the partners. This would help in reducing the cost and the risk of expansion which might otherwise be quite difficult. There are different type of joint ventures like forward integration , backward integration , buy back and multistage (Peter and Donnelly, 2013). Wholly Owned Subsidiary: The wholly owned subsidiary is the facility where it is controlled by a single parent company through the foreign direct investment. The drawback in this form of market is that there is higher degree of risk involved due to the substantial cost. Best market entry Strategy for Wilmar International: The company Wilmar International when entering into the Australian market will be adopting the licensing technique as an entry strategy. This is used mainly by the manufacturing units where they are given the right to use a particular type of technology after a certain amount of payment. The main reason for the company Wilmar International to achieve a license will help in effective way of financing the operation. The risk of black market will be reduced as licensing of products is quite expensive (Sethna, Jones and Harrigan, 2013). The research and development of the company is spread out with the increment in the income. This would help in little addition time or capital investment. Royalties are received for the granting of the rights to the intangible property to the licensee for some particular time (Hollensen, 2012). This would include the invention , patents , copy rights , designs , trademarks and formulas. The barriers in the investment will be over come through the way the firm is to participate. This is used more frequently by the firms possessing intangible property but does not develop business application. Recommendations International products strategy As Wilmar International mainly dealing with edible products hence, it is recommended that Wilmar International keeps in mind the standardization of the products (Aaker, 2013). The presence of the competitors in the markets of Australia will give a tough competition to Wilmar International (Cateora, Gilly and Graham, 2013). As a result, there are chances of conflicts with the competitors. Thus, to avoid unnecessary problems, Wilmar International should check the standards and the quality of the products thoroughly before they are launched in the Australian market. The economic condition of the country is hugely responsible for product adaptation (Gupta, Massisimo and Koontz, 2013). Hence, it is recommended to Wilmar International that they should check the edible oil industry before launching the products. Finally, the branding of the products should be given special attention as well. Wilmar International is a Singaporean company, which has come to Australia for marketing. Hence, the branding of the products should be done by keeping in mind the Australian customers. The products by Wilmar International should be flexible enough to adapt to the need and the demands of the customers in the Australian market and should have a consistency so that it helps the Australian customers to live a better life. International pricing strategy Pricing of the products is the most important factor when it comes to internationalization (Hood, 2013). The oil industry is always competitive at any stage. In addition to this, the Australian companies are quite strong, hence it will be better if Wilmar International adapt to penetration pricing rather than market skimming (Keegan and Green, 2013). The company will face a tough competition from the companies present in the Australian market. In such a situation, if it adopts to market skimming and introduce the products with a high price, then the chances are high that they might not acquire a good amount of customers as expected. On the other hand, penetration pricing will help Wilmar International to price the products in such a manner that the company will be able to acquire more customers. As the price of the products will be low, the customers can try the products with the perspective of just trying the products (Kerin, Hartley and Rudelius, 2013). If the customers like the pr oducts, they will carry one using it or stop using it. However, Wilmar International could not reduce the quality of the products while adapting to penetration pricing (Lagarde, 2012). Thus, it is recommended for Wilmar International to make use of penetration pricing as they are venturing into an entirely new market. International promotional strategy As it has been discussed earlier, the main problem that the companies face while promoting their products in an international location is the mismatch between the cultures. The culture of Australia and Singapore will be entirely different as both the countries hail from different backgrounds (Malhotra, 2013). Hence, while promoting the products, the marketer first need to know the mentality of the customers in Australia and the types of advertisement that will attract the people of Australia. Even if Australia is developed country, yet the people follow the newspaper regularly and have an inclination towards the advertisements that are being published in the newspapers (Mamula, 2012). It is recommended that it would be better if the marketer starts with the traditional form of marketing. However, the advent of technology has made then people of Australia quite close to the online advertisements. Australia is already a developed country and hence the relations of the people with the o nline sites are more than that could be seen in any other country (Aaker, 2013). There had been an increase in the interests for the online advertisements. Thus, it is recommended that while promoting the products, Wilmar International can make use of the online sites to promote their products in the Australian market. Before carrying out any kind of promotion, the marketer needs to research on the type of the people who would be attracted towards the advertisements. If the company is doing online advertising, then they should also think of direct marketing. Hence, it is important that the marketer knows the e-mail IDs of the customers and send the advertisements accordingly so that the right advertisements reach the right customers. International logistics and distribution strategy: Due to the advent of the free trade agreement, it has become easier for many countries to indulge in transactions with any Australian company (Cateora, Gilly and Graham, 2013). The free trade agreement has been beneficial not only for the international companies that are coming to Australia but for Australia as well as it is able to come in touch with many international companies. Wilmar International is one such company, which is benefitted by the free trade. However, the main challenge occurs when it comes to the trading within the country. The local transport system and the logistics play an important role is distribution of products in the international markets. However, the transportation and the logistics systems is quite strong in Australia and hence, Wilmar International can make use of the roads for the transportation of products within Australia. The Australian common wealth government has proposed to invest $36 billion for the enhancement of the roads and the transportatio n system (Profile of the Australian Transport and Logistics Industry, 2016). It has been expected that by 2050, it will be one of the major industries in Australia contributing for towards the economic growth of the country (Profile of the Australian Transport and Logistics Industry, 2016). Hence, it is recommended that Wilmar International should make use of the transportation system in Australia to distribute the products and opt for a hassle-free transportation. Conclusion: Thus, entering into the international market has both drawbacks and advantages for the company Wilmar International. In the highly competitive world, it is important for the company to understand that without the appropriate techniques of marketing it would be difficult for the company to survive and maintain a steady business. In order to overcome the risk there is a need for coming to understand the entire perspective of the Australian country i.e. the political, economic , social , technological , environmental and the legal aspect. There is a need for the strategy for almost everything from product till the distribution of the good. The company Wilmar International when entering into the market of Australian edible oil will be adopting the penetration pricing strategy. This would help the company to get more number of customers. With the lower price of the product there will be more customers by the acquired by the company. The use of the traditional method of promotion will not be that effective than that of the online method. This method will help the company to form a better relationship online and promotion of the products can be done quite effectively. Through availing the contact email id of the customers the offers can be sent to them. 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