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This report represents Aarong sour curd and its improved version....

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Submitted by:

Mind Benders

Sam M Mursa Mash MD. M

Course Title: Principles of Marketing Course ID: MKT201 Section: 01 Semester: Spring, 2020 Independent University, Bangladesh Date of Submission: 31st March, 2020

Submitted to, Mr. Abul khair Jyote Senior Lecturer, School of Business Independent University, Bangladesh

Letter of Transmittal 31st March 2020 Mr. Abul Khair Jyote Senior Lecturer School of Business

Independent University, Bangladesh Dear Sir, Subject: Submission of Marketing Report on “Principles of Marketing” Course. We are submitting our report on “Aarong flavored Sour Curd” as a mandatory requirement for our course Principles of Marketing (MKT-201).’ The report has been made through appropriate research of the subject matter and we tried our best to show precise data for this report. We humbly request you to go through our report and we ask for pardon in case of any unintentional mistake. Please note that this report has been prepared under your supervision. Under no circumstances will this term paper or information in this term paper be shared or republished without your authorization. Sincerely, Team Mind Benders

Acknowledgement It is not possible for a single person to carry out a plan of this magnitude on their own. We would therefore want to thank our respective faculty Abul Khair Jyote sir for enlightening us conceptually with pristine clarity throughout our classes. This report would have been impossible without your guidance and committed to perfection.

Executive Summary Aarong dairy is one of the well-known brands in dairy sector of Bangladesh. It has started the journey at 1998. Aarong dairy collects milk from rural farmers at fair price and sells it to urban consumers. It was started by the dairy social project of development organization BRAC, to assist underprivileged, rural dairy farmers and to look after them, develop their dairy enterprises, and progress their family's income by facilitating access to urban markets Aarong dairy has a different variety of products in its portfolio. Aarong sour curd is the primary subject of this report. We’ve included an explanation regarding the current market situation. An assessment of its product, price, place and promotion will be included as well. We will be going through the market description and where it will be targeted, the competitors and the new version(s) of the product. As we all know, Aarong dairy goes through the proper extensive process to provide quality and hygienic foods to the people who are aiming to consume safe and quality food products. Aarong sour curd has always been a major part of Aarong dairy. Now, Aarong is planning to introduce a new version of their sour curd in the market. Small size of 150gm (35TK) will be available in four flavors. The assessment of 4ps has been described, which are the price, place, product and promotion. Each of them plays a significant role in the introduction of flavored sour curd of Aarong. Moreover, two types of segmentation have been identified which are geographic and demographic segmentation. Such innovative item has been targeted to urban area middle Class people Of Dhaka and Chittagong. If it is successful then the product will be launched nationwide. Aarong is one of the most influential dairy company to introduce flavored sour curd in the market. It is completely new product in their portfolio. If it is successful then competition will rise. Competitors, such as, MilkVita, pran, cowhead, etc will try to copy the idea and lead to a greater competition in the market. Therefore, Aarong has to operate efficiently and manage the pricing strategies, promotion techniques as well as distribution patterns effectively.

Table of Contents Current Marketing Situation........................................................................................................1 Assessment of 4ps (Aarong Sour Curd).......................................................................................1 Market Description (Target Market) of Aarong Sour Curd......................................................3 Competitive Review of Aarong Sour Curd..................................................................................3 New Version of the Product...........................................................................................................6 Target Market of Aarong Flavored Sour Curd...........................................................................7 Assessment of 4Ps (Aarong Flavored Sour Curd)......................................................................8 References.....................................................................................................................................12

Current Marketing Situation According to various authentic resources, we’ve found out that Aarong Dairy, Pran and MilkVita are currently the market leaders in cases of dairy products, especially curd items. Although, MilkVita and Pran are a step ahead of Aarong. Therefore, Aarong cannot appeal to all buyers in the market place or at least to all buyers in the same way. Buyers are too numerous too widely scattered and too varied in the need and buying practices. Therefore, generally, Aarong wants to serve different segments of the market. Identification of the parts of the market that it can serve best and most profitable is a must. It needs to design strategies to build the right relations with customers. Firstly, Aarong dairy identifies markets segments. Aarong segments the market for the buyers need because segmentation is very important. Aarong also segments the market based on occasions, user status and usage rate.

Assessment of 4ps (Aarong Sour Curd) The following are the 4ps of Aarong sour curd: 1. Product 2. Price 3. Promotion 4. Place

1. Product As we’ve mentioned already the product is Aarong curd. Aarong has different types of curd, such as, sweet and sour. The curd will be contained in plastic container. Usually, the quantity varies on the size of the container. It can be contained in 100gm, 500gm and 1000gm container. It contains energy, protein, carbohydrate, fat, calcium and sodium. The curd will have to be used within 10 days from manufacturing date, as it is a perishable good. The design aesthetics of the packaging of Aarong curd is different than others which attracts the consumers and makes them 1

curious enough to buy it and try it out for themselves. Aarong curd is produced only with fresh and healthy raw materials which in any means won’t harm the consumers. The products are produced with great effort and concern. Aarong has a good recognition nationwide as they produce high quality products and maintain their standard.

2. Price The price of the Aarong Sour curd is TK 20 for 100gm, TK 80 for 500gm and TK 150 for 1000gm. Since the main marketing strategy of Aarong is to establish the brand in Bangladesh and increase the market share. Aarong has to apply market-penetration pricing techniques. The product is competitively priced to ensure wider consumer reach and to secure high-volume growth.

3. Promotion Most of Aarong’s promotions and advertisings are done online through various well-known social media websites/applications such as Instagram and Facebook. The advertisements are also televised. The ads are creative enough to attract people towards their products. Aarong also promotes their products through monetized videos in YouTube. Aarong also promotes their products by sponsoring many programs and events. Aarong also advertises their products through billboard advertisement which basically creates and captures a lot of customer value and attention.

4. Place The primary target of Aarong curd distribution is the entire of Bangladesh. The products will also be distributed in all the districts where Aarong usually sell their products. The product will be available in each district.

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Market Description (Target Market) of Aarong Sour Curd In order to target any particular market, a firm needs to do market segmentation. Segmentation refers to segmenting the market into different forms in terms of age, geography and so on. According to many sources, it has been found through the advertisement telecast that it shows an entire family who are very much fascinated towards sour curd. So, it can be said that Aarong sour curd is often consumed by all age of people. In terms of geography, we’ve found out that Aarong not only sells in Dhaka and Chittagong but it sells its products nationwide. Aarong divides its market into different geographical units, such as, city or metro size and density. Another segmentation is demographical, where Aarong divides its into different demographic factors, such as, age. Dairy products have the same taste and preferences and thus, many companies, are succeeding in this market by catering healthy and standard quality sour curd. The necessity of curd in preparing food or just eating it simply makes the market huge. The price variation of raw materials and ingredients added to the preparation of curd is one among the restrains in the dairy market. Therefore, in developing countries, like ours, people are preferring more homemade curd or curd prepared by unorganized dairy industry, as it includes pure ingredients and can be customized on the basis of ingredients and packaging. Hence, for the new product there’ll be a product line extension. Because, all the Aarong curd products fall in the category of product line.

Competitive Review of Aarong Sour Curd Aarong Dairy Sour Curd is delicious, creamy and smooth, made from fresh milk collected every day from homestead dairy farmers across Bangladesh. It is completely natural, free of artificial ingredients and preservatives. The direct competitors of our product would be any other companies dealing in the same sector, and the competition can be divided into two categories: Price-wise competition: The pricing of our Sour card is similar to other reputative brands like Pran, Milk Vita and Igloo. The rice of the Aarong sour card is TK 80 for 500 gram where as Pran 3

and Milk Vita both the company is also selling 500 gram of sour curd at the same Price but Igloo have kept the price of their 500 gram sour curd 5 Taka less than the other 3 brands which is 75 Taka as they have recently introduced their sour card in the market. The competition in this case would be Pran, Milk Vita, and Igloo however Aarong Dairy has a very strong brand value which is beneficial for Aarong and they are providing utmost quality by keeping the price as same as the other brands and that is already known by our customers and that is why Aarong has an advantage in the price-wise competition. Performance-wise competition: Aarong face Performance wise competition as Pran and Milk Vita, both of our competitors has a very strong brand value. So, it is important for Aarong to make sure that the sour curd outperforms the other companies offering similar products around the same price in each segment. The details of the competitor’s sour curd and Aarong’s sour curd are given below: Aarong Dairy

Milk Vita

Pran Foods

Igloo Dairy

Aarong Sour Curd

Milk Vita sour Curd

Pran sour curd

Igloo Sour Curd

Quantity of each sour Quantity of each sour Quantity of each sour Quantity of each sour curd in a container: curd in a container: curd in a container: curd in a container: 100gm, 500gm, 1000gm

100gm, 500gm, 1000gm

100gm, 500gm

500gm

Price:

Price:

Price:

Price:

100gm – 20Tk 500gm – 80TK 1000gm– 150TK

100gm – 22Tk 500gm – 80TK 1000gm– 150TK

100gm – 20Tk 500gm – 80TK

500gm – 75TK

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Some of the graphs relating to Aarong sour curd have been added below:

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New Version of the Product Aarong Flavored Sour Curd (Mango, Orange, Blueberry and Strawberry) Aarong dairy is a proud organization which excellently comes up with many ideas to produce and manufacture a new kind of product. Be it a brand extension or a line extension, they execute their tasks in order to accomplish their goals. We have come up with a new product Aarong flavored sour curd.

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Target Market of Aarong Flavored Sour Curd The market segmentation can be done using demographic and geographic variables. The demographic variables used are income, gender and age. The geographic segments are divided based on urban or rural locality inhabited by the population being segmented. As the GDP of Bangladesh is improving, households are having higher income and people have higher standard of living. Such a gigantic shift in household demographics will have a huge impact on demand for everything from food and beverages and consumer electronics to clothing and personal transport. The urbanization of Bangladesh is taking place at a faster rate than in the rest of the world. Aarong flavored sour curd is, therefore, targeting the market segment of urbanmiddle class people of Dhaka and Chittagong, who would love to try out innovative products while their spending power increases. Also, teenagers have a high level of media awareness and influence family decision-making in urban Bangladesh. An example of their influence is the success of breakfast cereals in urban Bangladesh. Cereals are increasingly being consumed by young urban children within rich and middle-income families and Kellogg’s has successfully taken advantage of this by positioning its cornflakes as a nutritious snack for children after school. Therefore, it is important to target this segment of the population. But influential as they are, a singular focus on just the children can be detrimental as the proportion of teenagers in the total population is estimated to fall, owing to families opting to have fewer children. Thus, based on the various socio-economic indicators mentioned above, the urban middle-class Indian family would prove to be a very attractive target segment. The choices of women and children play a huge part in deciding the food items consumed by a family. Married women who are educated and who are balancing busy careers with their families have comparatively less time to spend on daily cooking which has resulted in the increased popularity of packaged food. This trend is likely to continue as the number of working women is expected to increase over the coming years. Taking into consideration the above-mentioned demographic, economic and social factors, Aarong flavored sour curd can be positioned as a tasty and healthy versatile food option. It can 7

be consumed as a snack between meals, as dessert, or even as part of a meal like breakfast. It differentiates itself based on the superior health benefits, taste and quality offered. Aarong flavored sour curd is uniquely positioned as it offers the taste and enjoyment derived from consuming an indulgence food-item like ice-cream as well as the health and nutritional benefits of a health drink (E.g.: malted health drinks). In this way it can have the benefits of both products and differentiate itself from other value-added dairy and health food options present in the market. Aarong follows differentiated marketing which means it targets several segments & design separate offers for each. It has varieties of dairy products along with plain sour curd. Now, it is introducing four different types of flavored sour curd into the targeted market. Thus, Aarong will hope for higher sales and stronger position within each market segments.

Assessment of 4Ps (Aarong Flavored Sour Curd)

Product Aarong flavored sour curd is flavored edible sour curd made from milk, sour curd cultures, flavors, stabilizers whey protein concentrate and color. It is fortified with micro nutrients – Protein, Carbohydrate, Fat, Sodium, Calcium, Zinc, Vitamin A, Iodine and Iron. Aarong flavored sour curd does not contain any preservatives. It has a shelf life of 10 days. The product would be primarily positioned as a healthy snack that tastes good. It is currently available in four flavors in Bangladesh. They are: Mango, Strawberry, orange and Blueberry. The product is available in 150 gm packages. Currently no other product sizes are available. Aarong flavored Sour curd is packaged in a plastic container and vacuum-sealed using Aluminum foil bearing the attractive logo and branding. The containers are well sterilized before the fermented milk is poured in so as to remove the yeast since that leads to the creation of molds that destroy the sour curd. In addition, some stabilizers are added at the final stage that prevents the occurrence of ‘whey’, the watery coat that is formed above the set sour curd.

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Price The price of the Aarong flavored Sour curd is TK 35 for 150gm flavored sour curd. Since the main marketing strategy of Aarong is to establish the brand in Bangladesh and increase the market share. Aarong has to apply market-penetration pricing techniques. The product is competitively priced to ensure wider consumer reach and to secure high-volume growth. The operational cost involved in the manufacturing, marketing, distribution and retailing of 150 gm of flavored product is relatively high compared to plain sour curd.

Promotion The aim of the advertising program will be to create awareness about the new version of Aarong brand, to highlight the quality, taste and nutritional benefits of the product. Since the flavors of Aarong flavored sour curd is new to Bangladesh and it is in the introduction stage in the Bangladeshi market, the advertising has to create sufficient awareness about the product category among the customers and stimulate enough interest to promote trial of the product. The advertisements should also increase the brand awareness of Group Aarong and communicate to the consumers that Aarong is the largest company in dairy products in the Bangladesh. The advertisements would be primarily targeted at the segment of urban and middle-class families. Online advertising can be used to deliver promotional marketing messages to consumers, such as, test advertising, email advertising, social media marketing, web banner advertising, etc. Choice of media: The main focus should be on television ads, as it reaches more urban families than any other medium. Display media such as billboards, signs etc., innovative promotion programs and point-of-sale promotions could also be implemented to ensure wider reach. Advertising Program Television Advertisements: The television advertisements would be targeted at the urban and middle-class families. We suggest that there should be two separate television advertisement strategies – one for increasing the brand equity of Group Aarong in Bangladesh and one focused on building the awareness of Aarong Flavored Sour curd. It is important to build the brand awareness of Aarong as the urban middle-class consumers in Bangladesh are highly aspirational and would love to be associated with a premium quality brand. Aspiration-led marketing and portrayal of brands as status symbols has worked well in the 9

past with the Bangladeshi consumers. This could also create an edge against established competitors such as Milk Vita, Pran and Cowhead and aid in brand recall. The advertisement should be informative; the purpose here is to introduce the average Bangladeshi consumer to Aarong as the country’s largest dairy group. Aarong is one of the first to introduce flavored sour curd in to the market. The product related television advertisement should be built around the product features, taste and health benefits, appetite appeal and the snacking occasions. One of the main intentions is to ensure that potential customers try out the new flavored product. The plain sour curd is a part of Bangladeshi diet and is generally preferred over the flavored sour curd which has less appeal to the Bangladesh palate. Hence, the advertising has to actively motivate the consumers to switch from tra...