Current Market Scenario of Beverage Products in Dhaka City: Royal Crown Cola Company
The Historical Development Of Rc Beverage
1.1 The company profile of Coca Cola
In 1893, “Coca-Cola” was registered officially in the U.S. Patent and Trademark Office. Since people kept asking for “Coke,” the Company relented to popular demand. In 1941, the trademark “Coke” received equal prominence in advertising with “Coca-Cola,” and in 1945, “Coke” was registered as a trademark.
In 1955, the Coca-Cola Company marketed its first soft other than Coca-Cola: an orange-flavored soft drink introduced in Naples, Italy. The trademark, based on the word “fantasy” was the result of a bottling plant employee contest. Fanta is now the number – five soft drink worldwide.
The idea for the name of the lemon-lime soft drink, Sprite, came from early advertising. During the 1940s, an elf with silver hair and a big smile (and most often wearing a bottle cap for a hat!) was used in advertising for Coca-Cola. This character, known affectionately as the “Sprite Boy,” urged consumers to buy more of the product.
In the late 1950s, the company developed a circus-flavored drink. The short, sharp and memorable sound of “Sprite” made it an ideal name for the new product. Since another company had been using the name since 1955, the company had to purchase and register “Sprite” as its property. In 1961, Sprite made its U.S. debut. The Coca-Cola Company acquired minute Maid another popular in 1960. In 1985, the name was extended to a new U.S. soft drink, Minute Maid orange.
The Coca-Cola Company is named as Tabani Beverage Company Limited. It is the No. 1 soft drinks now at in Bangladesh as well as all over the world. It is now doing almost a monopoly business in the beverage sector.
It has three varieties. They are:
i. Coca-Cola – Cola flavor
ii. Sprite – Clear flavor
iii. Fanta – Orange flavor
2.1 The company profile of Pepsi
Pepsi Cola Company Ltd. is incorporated and continuing its operation in Bangladesh as a private company. It is named as Bangladesh Beverage Company Limited.
The company is currently operating four plants located in Dhaka, Chittagong, Bogra and Jessor. Pepsi now has six different flavors including its new arrivals, ‘Slice’ (Mango flavor) and ‘Mirinda lime’ (Orange flavor).
ü Pepsi – Cola flavor
ü 7UP – Clear flavor
ü Mirinda – Orange flavor
Pepsi is one of the oldest brands in Bangladesh. Pepsi is first arrived in Dhaka in 1976. Late Mia Amanullah, Former Executive Director of Pepsi Cola Co. Bangladesh, introduced the brand. At first, Pepsi and 7UP were separate companies. However, in 1989, the companies merged and named under Pepsi Company Ltd. Bangladesh. Its varieties are-
The Pepsi Cola story itself begins with a drugstore in New Bern, North Carolina, and a pharmacist named Caleb Bradham. Bradham’s aim was to create a fountain drink that was both delicious and healthful in aiding digestion and boosting energy. It would be free of the impurities found in many bottled health tonics, and it would contain none of the stronger narcotics often-added to popular fountain drinks.
By 1902, he succeeded in doing so and Pepsi was invented. The demand increased so dramatically it dawned on Bradham that Pepsi-Cola was something special. On December 24, 1902, he filed incorporation papers with the state of North Carolina; in these, he indicated his plans for corporate branches in Virginia, Maryland, Pennsylvania and New York.
2.3 The company profile of Pran
AMCL market its product under the brand name PRAN that stands for Program for Rural Advancement Nationally. The Agriculture Marketing Co. Ltd. (AMCL) was incorporated in Bangladesh on 15th May 1985 as private limited company under the companies Act 1913 and subsequently on 2nd June 1993 the co. was converted into public limited co. the shares of the co. were listed in Dhaka and Chittagong stock exchanges.
The company is financed by industrial Promotion and Development Co. of Bangladesh Ltd., ANZ Grindlays Bank, Dutch Bangla Bank and by its stakeholders.
Initially PRAN had jam, Jelly and Pickle in its product line. In January, 1995 production of orange juice and in June production of PRAN mango bottled juice started. PRAN now operates by having eight zones throughout the country. The zones are Dhaka Metro, Adjacent Dhaka, Comilla, Chittagong, Sylhet, Khulna, Barisal and Rajshahi. The company also has three more sub zones.
The company’s business activities are farming, trading, processing of fruits, vegetables and other agro products. Unit wise activities of the company are shown below.
Unit-1 Processing of agro products
Unit -2 Farming
Unit- 3 Bottling, tetra packaging of juice and mineral water.
Unit- 4 Trading
2.4 The company profile of Virgin
Virgin-the third most recognized brand in Britain is involved in planes, trains, finance, soft drinks, music, mobile phones, cars, wines, publishing, bridal, wear, etc. they crated over 200 companies world wide, employing over 25,000 people. Their total revenues around the world in 19999 exceeded U S $5 billion. They claim that their brand Virgin is now becoming the first global brand name of the 21st century.
They said their companies are part of a family rather than a hierarchy. They are empowered to run their own affairs, yet other companies help one another, and solutions to problems come from all kinds of sources. In a sense they are community, with shared ideas, values, interests and goals. And Virgin cola is just a member of that family.
2.5 The company profile of Suncrest
National Beverage Industry Ltd., a unit of Sunman Group, first bought Bangladesh Suncrest. The head office of the company is in Chittagong and in 1997, a branch office in Dhaka was started. The company has its factory located at Hemayatpur, Savar. Initially the company used to produce eight flavors, but it is now continuing with five flavors. Suncrest was the company to introduce a 1.5 litter plastic bottle, which turned out to be a profitable step for them. It is called the Suncrest Mega. Its varieties are:
ü Suncrest Cola
ü Suncrest Orange
ü Kickapoo Joy Juice
ü Bubble Up (Lime)
2.6 The story of RC (Royal Crown)
Royal Crown (RC) Cola made by the Royal Crown Cola Company is the third most popular Cola in America. It is tasty, refreshing soft drink. In 1905, it was at first designed merely to meet the needs of grocery customers in a limited graphical territory.
A young man named Claude Hatcher who was a good chemist, developed Royal Crown Ginger Ale in 1906. Royal Crown Ginger Ale was a product of Hatcher Grocery Company of Columbus. Later around 1910, it was renamed and was called Chero-Cola rich in cherry flavor.
In 1923, the firm came up with a fruit flavored drink name Melo. A year later the brand name was changed to Neli. Neli was a quick seller and by 1928 a new company was formed called Neli Inc. and Chero-Cola was then became a product of Neli Inc. in 1932 Neli Chemist Rufus Kamm concentrated with a new cola drink and his concentration result was royal crown cola. It was introduced in 1934. In 1959, the company name changed to Royal Crown Cola. Royal Crown Cola company’s technicians made what industry leaders term “ The most amazing break through soft drink technological history.” Royal Crown Cola Company was the first soft drink company to introduce a sugar free product in 1962 and it was the first company to introduce a salt/sodium free cola in 1980.
The Royal Crown Cola Company made a late start on the international scene and the reason for this was simple. Its management wanted to marshal its resources and concentrate its efforts on the biggest growth market in the world at the time in United States.
In early 70’s, RC Co. decided to go for global reach and at that time, a number of experienced soft drink people assembled to manage and direct the company’s international efforts. Since then, RC Cola has been able to establish a viable base in the world market and it is currently sold in 63 countries through a network of 78 franchise bottling plants.
At first, in 1995 RC Cola introduced a premium draft cola. It introduced RC Products in Bangladesh market in 1997 adding Royal Crown Lemon (first of its kind) with three other refreshing flavors of sweet & seriated RC Cola, the fresh orange flavor of Royal Orange, the tangy lime taste of Upper 10.
Partex Beverage Ltd. was incorporated in Bangladesh in 1997 as private limited company under the companies Act, 1913. It is a member of Partex Group of Industries.
“To provide value at an economic cost, progress in diversity, and continue to contribute to the growth of industrialization in Bangladesh being the market challenger”.
2.6.2 Objective of RC
Partex beverage industry is technically well equipped and quality control, at all stage, is of highest order. The commitment of each department has ensured a management system of the highest standards. From the initial rigorous quality taste of raw material to final inspection, the beverages are assured of the highest quality. The product is an enduring testimony to the unique excellence of the workforce.
RC’s strength lies in the fact that it is the best in taste test against the order two colas. RC takes an aggressive approach when planning its marketing strategy. Traditional marketing packages, prices, promotion and distribution systems do not bind it, and by the same token, it does not discard traditional marketing patterns if they present the means or opportunity of expressing a positive point of different.
RC management approaches each situation with an open mind instead of imposing marketing plans and programs on its franchisees. They recognize the differences as well as similarities in each market and try to do be understanding and responsive to each bottle’s needs.
Royal Crown Cola Company is proud of its products and of the bother’s that distribute them. Together they maintain the high standards that were established by the company’s pioneers. Their goal is always to provide the best possible products at the reasonable prices, promptly and courteously to customers everywhere.
2.6.3 Beverage Organogram (Management Structure)
2.6.4 Management Structure Analysis
The Number 1 person of RC Cola Is Managing Director. After him the post of Director Marketing does come. He has two supporting executives to help him in works. One of them is Marketing Manager and another one is Controller, sales. Marketing Manager has an executive officer named Brand Officer. Controller, Sales Manager has also two executive officer to help him. They are Bottle Manager and Sales Manager. Sales Manager has his Deputy, Asst. Sales Manager. Asst. Sales Manager has a subordinate, Sales Officer and Sales Officer has a Deputy, Asst. Sales Officer. Another two people work under him. They are Sales Representative and merchandiser.
2.6.5 Management Function of RC
RC Cola’s Management System Functions in four ways. They are as follows-
Partex Beverage (RC) has top down planning approach. The top-level Management like Managing Director and Director Marketing has authority to decide how they will go through and achieve their goal. If the Brand Officer or Sales Manager gives some idea or plan to marketing Manager or Controller Sales Manager the top level Management always encourages their ideas and gives them the opportunity to carry with their plans and ideas if the Management thinks that the idea will turn into profit. The top-level management sometimes asked the Marketing Manager or Brand Officer to make some innovative plan for the company. If they become successful to innovative something new the top level Management have a look on it and then they decide whether to go through it or not.
Partex Beverage is a concern of Partex Group of Industries. It is franchised from American Royal Crown Company. RC’s industry is in Rajendropur, Gazipur. It has sales and corporate officer in Motijheel C/A in Ispahani Building. RC’s head and only office is situated in Sena Kalyan Bhaban (16th floor).
RC recruits staffs according to their qualifications and the nature of their job. For recruitment, the top-level Management always gives more priority on oral tests (viva-voice).
126.96.36.199 Directing & Controlling
RC’s all employees have to maintain the office time of Partex Group as it is a concern of Partex Beverage and the office time is from morning 9 a.m. to evening 5 p.m. Asst. Sales Officer and Sales Representative has to stay outside of the office for their working purpose. In office, the sitting arrangements are created in such a way that if the subordinates face any problem they can easily ask their superiors. Although RC has a particular office time, all the employees have so much responsibility that if they have any major work in their hand they leave the office completing the work.
PART- 3 CURRENT MARKET SCENARIO OF BEVERAGE PRODUCTS IN DHAKA CITY
We know there are four channels in marketing. Theses are as follows:
q Distribution channel
q Price channel
q Product channel
q Promotion channel
3.1 Distribution channel
3.1.1 Distribution System
The retailers informed that every company follows the same distribution channel process for soft drinks distribution. The distribution channel followed by the beverage companies is:
Company Distributors Retailers Consumers.
3.1.2 Selling System of Beverage Products
The total sample size of retailers informed that they received the soft drinks bottle from the beverage companies van. e.g. Coca-Cola company serves Coke, Fanta, Sprite and R C company serves R C lemon, R C cola etc. but most of the retailers could not inform whether they received the drinks bottle from the distributors or directly through from the company people, because they were not interested about the matter.
3.2 Price Channel
3.2.1 Price Margin
For Coke, the distributors make profit of 14 TK crate and 0.58 TK bottle. The retailers make profit of 50 TK crate and 2.08TK bottle. (Table-3.1.2) The distributors make profit of 15 TK crate and 0.63 TK. bottle. The retailers make the same profit like Coke of 50 TK crate and 2.08 TK bottle. Here Pepsi distributors gain 0.05 TK bottle and 1.2 TK crate more then the distributors of Coke. (Table-3.1.2)
R C and Virgin offer more profit advantage to distributors and retailers. The distributors make profit of 16 TK crate and 0.67 TK bottle, which is more than Pepsi by 0.04 TK bottle (0.96) and more then 0.08 TK bottle (1.92 TK crate). The retailers make profit of 54 TK crate and 2.25 TK bottle, which is bigger than Coke and Pepsi (4 TK bottle and 0.17 TK crate). The R C retailers gain here the highest. For Suncrest, the distributors make the highest profit of 17 TK crate (.07 TK bottle). The retailers make profit of 52 TK crate and 2.16 TK bottle which is lower that the retailers of R C and Virgin gain. Therefore, all the price margin of PRAN is same as Pepsi.
3.2.2 Deposit Against Crates & Bottle
For Coca-Cola, the retailers pay 30 TK crate (350ml) and 150 TK crate (1000ml). the deposit against bottles is 120 TK.crate. It means each bottle deposit is 5 TK. (5*24=120). The retailers have to pay 240 TK. deposit money for 1000ml crate. Each crate contains 12 bottles and the calculation stands like this for per crate-12*20=240 TK. bottle for 1000ml drinks of Coke. For Pepsi, the deposit of 250 ml and 1000 ml bottle remain the same like Coke. As the Sun crest and PRAN has only 250 ml bottles, their deposit also remain the same like Coke. On the other hand, virgin has no 250 ml bottles; they do produce any kind of bottle beverage. So their deposit system for 1000ml is like R C cola.
R C beverage offers incentive for the retailers. R C offers 300 ml bottle in 120 TK bottle and Coke and Pepsi charges the same amount but they give the retailers 250 ml bottle.
R C’s crate deposit remains same like Coke and Pepsi. R C 1000 ml crate has two varieties. One of them contains 6 bottles of 1000ml and another one contains 12 bottle of 1000 ml. the retailers pay deposit of only 50 tk. for the 6 bottles container and 100 TK for the 12 bottle container. For R C, retailers have to deposit 140 TK. less/ crate.
3.2.3 Credit Facilities
The retailers informed that none of the beverage producers offer them any credit facility. It means the beverage companies never proposed credit facilities to them.
3.2.4 Cost of Damaged Bottles
65 % of the retailers informed that they did not have to pay money for the broken or damaged bottle as they had already bought the bottles from the companies. 35% of them informed they paid five TK. For each broken or burst bottles. The consumers have to pay the same amount of money for each broken or damaged bottle, when they cause the damage
3.3 Product Channel
3.3.1 Sales Profile & Some Important Information about Different Companies
Coke: Coke has two different operations in Bangladesh. One part controlled by Muktijuddah Kollan Trust, and another one is controlling by Tabani beverage. Government owns Muktijuddah Kollan trust and Tabani beverage is private. Muktijuddah Kollan Trust covers the Dhaka and Rajshahi region. On the other hand, Tabani covers other part of Bangladesh.
The yearly sale of Coca-Cola in Bangladesh is 98, 00,000 crates. They have Cola, Orange, Lemon, Mango and Diet flavors in the beverage market. Coke has 250ml glass bottle, can and fountain glass. In family size packing, they have one liter. 1.5-liter glass bottle. They do not have two-liter bottle. They also have not P E T bottle production in Bangladesh. Coke has 90 distributors in Dhaka and Rajshahi district. Their sales force is consist of 80 peoples.
Pepsi: the yearly sale of the Pepsi Company is 60, 00, 000 crates. As like Coke, they have Cola, Orange, Lemon, Lime, Mango, and Diet and very recently, they introduced Apple flavor in Bangladeshi beverage market. They are enriched in different pack size too. They 250ml glass, can and fountain glass. In the family size, they have 1, 1.5 and 2-liter glass and PET bottle they have also 500ml pet bottle. To cover the whole country they have more then 400 distributors. Their sales force contains 100 people.
Virgin: The yearly sales of Virgin 2 million crates. Last year they sold 84% Cola, 7%Orange, 5%Lemon and 4%Diet. Virgin first come up with the can system within a reasonable price. They do not have any kind of glass bottle. They have 250ml can and 500ml pet bottle. They also have 1.5 liter and 2-liter PET bottle. Virgin has 100 distributors and number of sales force is 40.
RC cola: The yearly sale of R C cola is 3.5 million crates. Their most popular flavor is Cloudy Lemon. Like Pepsi, they have verity in flavors and pack size. They have 60 distributors and 55 sales people.
3.3.2 Brand Preference
The consumers informed the following things about the brand preference of the beverage products-
Consumers like Coke’s 250 ml and 1000ml bottles both. The same result goes in favor of Pepsi. Consumers also like the Cloudy lemon of R C cola and the new can system of Virgin, which had launched by global beverage. Consumers like R C’s 300ml bottle more than their 1000ml bottle and Sun-crest’s mega bottle more than 250 ml bottle. As PRAN has no brand variety, so consumer has no choice their in case of PRAN.
3.3.3 Consumer Group Survey
The consumer group was divided into four categories. They were
ü People over 35 years
All the above four categories were the consumer of coke and Pepsi simultaneously. RC and PRAN were like by the three categories of consumers except children. On the other hand the first three groups of consumers except people over 35 years liked sun crest.
The objectives of the consumer survey were to know the following things.
ü Most preferred brand consumed by the consumer
ü Most preferred type of flavor
ü Influential factors
ü Package size
ü Segmentation of the consumer
ü Consumer liking
ü Consumer disliking
3.3.5 Most Preferred Brand Consumed by the Consumer
Out of the total sample size, 62.13% consumers like Coke, 17.26% Pepsi, 9.11% RC, 6.75% Virgin and others 4.75%. According to the result of the survey, we find that most of the consumer in the Dhaka city liked Coke and the ratio is 62.13%.
3.3.6 Most Prefer Type of Flavor
The consumers informed the following above the most prefer type of soft drinks: 51% consumer indicated that they liked the Cola flavor most. 18% of them like the Orange flavor, 20% liked Lemon, 4% liked Diet, 4% Mango and others 3% liked Lime. Actually, children and women liked Orange and Mango flavor most. Diet liked by health conscious people.
3.3.7 Influential Factors
The influential factors are taste, brand, advertisement, friend’s influence and one of the vital factor availability. The result had shown that 67% taste, 13% brand, 10% advertisement, 7% friend’s influence and 3% availability influence the consumers to buy or have the beverage product.
3.3.8 Pack Preference
The consumer indicated the following things about there pack preference of soft drinks:.23% of the consumer liked the fountain drinks, 27% liked 300ml bottle, 23% liked 250ml can, 19% liked 1000 and 1500ml PET bottle and only 8% liked 1000ml glass bottle. Consumers do not like the 1000ml glass bottle because of hazard of deposit system of bottle from the consumer.
3.3.9 Segmentation of the Consumer
We have divided the consumers according to the age. The segments are children, teen age, youth, people over 35 years. The aim was to find out which segment like most the beverage product. The result indicate that 12% children, teen agars 49%, youth25%, people over 35 years 14% consumed or have beverage product. Therefore, the result indicates that tee agars are the main segment of the consumers.
3.3.10 Sources of Information
The consumers reported the following about the sources of information 36% of them got the information about soft drinks from TV, 32% got the information from the print media, 18% from the Radio, 12% from the out door (billboard) and only 2% from the word of mouth communication.
3.3.11 Comparison of Cola
188.8.131.52 Taste Preference
The varieties of Cola in beverage products are:
ü Coca cola
The consumers indicate that they like Coke’s cola most. The result I got they liked 46% cola of Coke, 24% cola of Pepsi, 12% of RC, 15% of Virgin and 3% of Sun-crest’s cola.
184.108.40.206 Reasons for Liking
There were some categories in reasons for liking the beverage companies soft drinks. They were as follows:
ü Well balanced
The consumers informed the following things about their choices of the five categories, for liking the Cola flavor:
Þ 100% of the consumers indicated that only Coke was well balanced. Well balance means the balance combination of punch, strong, sweetness, and taste.
Þ 83% reported that coke had punch, 10% indicated that RC had
punch and the rest of 7% informed that Virgin had the punch.
Þ 81% consumer indicated that Coke was strong and 13% reported for Pepsi and 3% consumer reported each for RC and Virgin.
Þ 91% consumer indicated that Coke had the sweetness, 5% indicated that Pepsi had the sweetness and 2% indicated that RC and Virgin each had the sweetness.
Þ 85% consumer indicated that Coke had the perfect taste, 10% indicated that Pepsi had that, 3% indicated that RC had the taste and 2% consumer indicated that Virgin had good taste.
3.3.12 Comparison of Orange
220.127.116.11 Taste Preference
The varieties of orange in beverage products are:
ü RC orange
ü Virgin orange
The consumers informed the following things about their taste preference in Orange flavor 80% of the consumer liked the taste of Fanta, 10% liked Mirinda, 8% liked Virgin orange and 2% liked the taste of RC Orange.
18.104.22.168 Reasons for liking
The consumers informed the following things about their choices of the five categories, for liking the Orange flavor:
Þ 75% of the consumers indicated that Fanta was well balanced and 6% consumer indicated that Mirinda was well balanced, 10% indicated that RC Orange was well balanced and 9% indicated that Virgin orange was well balanced.
Þ 100% of the consumers indicated that only Mirinda had the punch.
Þ 79% consumer indicated that Fanta was strong and 11% consumer reported each for Mirinda and Virgin orange.
Þ 80% consumer indicated that Fanta had the sweetness and 20% indicated that Mirinda had the sweetness.
Þ 82% consumer indicated that Fanta had the perfect taste, 17% indicated that Mirinda had that and 1% consumer indicated that Virgin orange had good taste.
3.3.13 Comparison of Clear
22.214.171.124 Taste Preference
The varieties of clear in beverage products are:
ü Upper 10
ü Bubble Up
The consumers informed the following things about their taste preference of Clear flavor 77% of the consumer liked the taste of Sprite, 7% liked 7UP and 3% liked the taste of Upper 10.
126.96.36.199 Reasons for Liking
The consumers informed the following things about their choices of the five categories, for liking the Clear flavor:
Þ 92% of the consumers indicated that Sprite was well balanced and 8% consumer indicated that 7UP was well balanced.
Þ 89% of the consumers indicated that Sprite had the punch and 11% indicated that 7UP had the punch.
Þ 100% of the consumer indicated that Sprite was strong.
Þ 91% consumer indicated that Sprite had the sweetness and 9% indicated that 7UP had the sweetness.
Þ 88% consumer indicated that Sprite had the perfect taste, 6% indicated that 7UP had that and 6% consumer indicated that Upper 10 had good taste.
188.8.131.52 Reasons for Not Liking
There were some categories for not liking reasons. They were as follows:
ü No punch
ü Too strong
ü Not sweet
ü Too sweet
ü Bitter taste
The consumers informed the following things about their reasons for not liking, 7UP, Upper 10 and Bubble up. They did not like 7UP, Upper 10 and Bubble up for the following reasons:
Þ 50% disliked Upper 10 because it was sour and 50% did not like Bubble up for the same reason.
Þ 40% of the consumer did not like 7UP because it had no punch and 60% disliked Bubble up because it had also no punch.
Þ In the “not strong” category, 80% consumers disliked 7UP and 17% disliked Bubble up because both of them were not strong..
Þ In the “too strong” category, 13% of consumers did not like both of 7UP and Upper 10 because they were too strong and 74% consumer dislike Bubble up because it was too much strong.
Þ In the “not sweet” category, 51% disliked 7UP and 25% consumers disliked both of Upper 10 and Bubble up because they were not sweet.
Þ In the “too sweet” category, 14% of consumer disliked both of 7UP and Upper 10 because they were too sweet and 72% disliked Bubble up for the same reason.
Þ In the “bitter taste” category, 17% disliked 7UP, 258% customers disliked Upper 10 and 58% did not like Bubble up because they had the bitter taste.
Þ In the “taste less” category, 20% consumers disliked 7UP and 60% consumers did not like Bubble up because they were taste less and the rest 20% consumers disliked Upper 10 for the same reason.
Þ In the “taste” category, 11% consumers disliked 7UP, 26% disliked Upper 10 and 63% did not like Bubble up because all of them had no taste.
3.3.14 Comparison of Cloudy
184.108.40.206 Taste Preference
The varieties of cloudy in beverage products are:
ü Mirinda lemon
ü RC lemon
The consumers informed the following things about their taste preference of Cloudy flavor 72% of the consumer liked the taste of RC Lemon, 20% liked Mirinda lemon and 8% liked the taste of Kickapoo.
220.127.116.11 Reasons for Liking
The consumers informed the following things about their choices of the five categories, for liking the Cloudy flavor:
Þ 81% of the consumers indicate RC lime was well balanced, 6% consumer indicate that Mirinda lime was well balanced and 13% indicate that Kickapoo was well balanced.
Þ 100% of the consumers liked only RC lime because it had the punch.
Þ 25% of the consumer indicated that Mirinda lime was strong, 63% indicated that RC lime was strong and 13% indicated that Kickapoo was strong.
Þ 33% consumer indicated that Mirinda lemon had the sweetness, 56% indicated that RC lime had that and 11% indicated that Kickapoo had the sweetness.
Þ 18% consumers liked both of Mirinda lime and Kickapoo because they had taste and 64% consumers liked RC lime for the same reason.
18.104.22.168 Reason for Not Liking
There were also some categories for not liking reasons. They were as follows:
ü No punch
ü Too strong
ü Not sweet
ü Too sweet
The consumers informed the following things about their reasons for not liking Mirinda lime and Kickapoo:
Þ 67% disliked Mirinda lime because it was sour and 33% did not like Kickapoo up for the same reason.
Þ 20% consumers did not like both of Mirinda lime and RC lemon because they had no punch and 60% disliked Kickapoo for the same reason.
Þ In the “not strong” category, 20% consumers disliked Mirinda lime, 30% consumers disliked RC lime and 50% did not like Kickapoo because all of them were not strong.
Þ In the “too strong” category, 100% consumers disliked Mirinda lime because it was too strong.
Þ In the “not sweet” category, 100% consumers did not like RC lime because it was not sweet.
Þ In the “too sweet” category, 40% consumers disliked Mirinda lime because it was too sweet and 60% disliked Kickapoo because it was too sweet.
Þ In the “taste less” category, 50% consumers disliked Mirinda lime and 20% did not like RC lime because both of them were taste less and the rest 30% consumers disliked Kickapoo for the same reason.
Þ In the “taste” category, 59% consumers disliked Mirinda lime, 6% disliked RC lime and 24% did not like Kickapoo because all of them had no taste.
3.4 Promotion Channel
3.4.1 Display of Crates and Bottles
The retailers informed that arranged the display of the bottles and crates themselves, according to the size of their shop. Company people never forced them to adopt any particular style of display unless the retailers were said to do so.
36 % of the retailers informed that they had paid for the signboards themselves. Among the rest 64% signboards, 28% signboards were found of Coke, 16% Pepsi, 9% R C, 7% Virgin and 4% of each for Sun crest and PRAN signboards were found. The retailers informed that the beverage companies paid for the cost of their signboards in the particular shop or confectionery. The retailers gave the signboards measurement to the beverage producers and they had then made for the retailers, as signboards is a very useful media of advertisement for the beverage companies.
3.4.3 Company Wise Cooler Position & Deposit System
The retailers informed that 45% of them had their own refrigerator. 22% Coke cooler was found and 16% Pepsi, 9% R C, 5% virgin and 3% Sun crest cooling system were found. PRAN had no cooler in retailers market.
The retailers informed the following things about the payment system of beverage cooler-
Retailers had to deposit TK. 5000 for the refrigerator of Coke. They paid 2000-6000 TK. for Pepsi cooler. Virgin keeps 2000tk for the cooler. The retailers deposited TK 6000 for the refrigerator of R C. However, in some special cases R C did not take the deposit amount from the retailers, as company cooler was an important and useful advertisement for R C beverage. The retailers also informed that no company was interested to keep other companies soft drinks in their brand refrigerator. It was observed that the retailers kept all companies soft drinks together in a brand refrigerator whether it was of Coke’s, Pepsi’s or R C’s.
3.4.4 Competitive Situation of Beverage Products
In the beverage industries, every company for trading emphasized on the retailers. Companies think retailers are key factor for moving or reaching their product to the ultimate consumers.
3.4.5 Reasons for Giving Priority of Retailers
Retailers give priority to brand companies based on some factors. The factors are describe as follow-
ü Public Demand: The retailers give preference to public demand, because their profit mainly depends on consumer choice. Retailers sell that brand is soft drinks more, which the consumers like most. Based on public demand they keep more bottles of Coke and Pepsi. The retailers keep Cloudy lemon more than other product of R C cola.
ü Discount: In this case, the retailers consider all the beverage companies in the same way, as no company offers the retailers any kind of discount. All the companies take the particular amount of bottle and crate deposit money in time.
ü Free Bottles: The retailers always give priority to free bottles that they receive from the company. When the retailers manage to sell a particular number of bottles, every company gives them some free bottles for their encouragement, so that they give more preference in selling the products of the specific brand.
ü Gift Items: The retailers always give priority to those brands who give them gift items like opener, T-shirts, glass, wall clock etc. the company, which gives the retailers gift items were more preferred by them, and they like to keep more bottles of that brand.
3.4.6 Promotional Activities
It has two parts. Both parts are described bellow:
22.214.171.124 Promotional Activities for Traders
The beverage companies are offering several promotional activities. They are described as follows:
ü Opener: Coke, Pepsi , R C, and Virgin companies offer this promotional activity to the traders for the goodwill of their company. Actually they keep this offer all year long.
ü T-shirt: All the beverage companies offer this promotional activity to the traders. T-shirt is also a good advertising media.
ü Free Bottles/ Discount of money: These two promotional activities have very close relationship with each other. The beverage companies always give free bottles in lieu of discount of money. Coke, Pepsi, R C, Virgin, and PRAN all the beverage companies maintain this promotional activities.
ü Glass: Coke and Pepsi first started this promotional activity, but recently Virgin using this technique very effectively. This is a very costly promotional activity.
126.96.36.199 Promotional Activities for Consumer
The beverage companies offer several types of program for the promotional activities of consumers.
ü Linear Program: Coke and Pepsi companies offered this program long ago. It got huge public popularity. The linear program was like this-after buying a bottle of Coke or Pepsi the consumer had to collect the linear and open it. There were something printed inside of the linear. There could be some figure of money, some gift item like opener, glass etc. Only the lucky person got that linear. They give the linear to the nearest retailer shop. Coke offered a car and Pepsi company gave Motorcycle in that linear based program. Now a day, there is no practice of this kind of program by the beverage companies.
ü Glass Program: Coke Company introduced this program. The rule of this program was –if a consumer drink 5/6 bottles of he or she would receive a glass from Coke Company through the retailer. This program is frequently use for both consumers and retailers.
ü Other Program: There are some other types of incentives given by different beverage companies. They are given as bellow:
Þ Buy one liter Coke and get a Frisbee.
Þ Pepsi gives different food item with their liter bottle. They also give Cricket bat, ball, pad etc.
Þ R C cola gives a five-taka discount with every one-liter bottle.
3.4.7 Competitive Situation
This part is the most vital part of this report. The retailers in this study sold the following percentage of Coke, Pepsi, Virgin, R C, sun-crest and PRAN beverage product per day.
They sold 40.56%Coke (250ml), 34.26%Pepsi, 10.98%R C, 6.59%Virgin, 6%PRAN and 1.61%Sun-crest per day. The ratio shows that Coke has strong market share of 40.56% and sun-crest has the lowest market share of 1.61%. The liter bottle crates sold per day by the retailers were the followings-
45% Pepsi, 35% Coke, 9%R C, 9%Virgin and 2% Sun-crest. Here Pepsi hold the strong market share of 45% and Sun-crest has lowest market share of 2%. PRAN has no liter beverage item in the market so they do not have any market share.
With regard to bottle out put / day, only Coke and RC companies revealed the information. The bottle output /day of Coke was 4500 crates of 250ml bottle and 4500 crates of 1000ml bottle. The sum of their bottle output per day was 9000 crates. On the other hand, R C outputs 6000 crates per day, 3000 crates of 300 ml bottles and 3000 crates of 1000 ml bottles.
3.5 Quality Problem Encountered by Beverage Product
This is a confidential mater for Beverage Company. Only one problem is possible to know from the beverage companies. The rotten things of the soft drinks. Companies pollute the environment of the beverage companies. As because the beverage companies always face the cleaning problem. The beverage companies should try their level best to get rid of this problem. This problem affects the quality of their beverage products.
3.6 Media Wise Advertisement Ratio of Beverage Products In Dhaka City
This was the most vital part of my project work to gather the information about the advertisement budget and its ratio. However, it very sensitive information for all beverage companies, so they gave me the approximate data about the advertisement and its ratio. There are different media is used for the advertisement. Those are press, out door, T V and different events.
Some companies emphasize on TV media and some focused on the sports events. The companies most frequently use this two medium. As my topic is to study the recent market scenario of the beverage industries of the Dhaka city. Therefore, I have collected the information of the companies, which is actually Dhaka reason based.
Only the T V and newspaper advertisement ratio of Coke, Pepsi, R C, Virgin and Sun crest companies had possible to gather. The T V advertisement ratio of Pepsi, Coke, R C, Virgin and sun crest was available for month of October and November. In the above three months Pepsi spent 47, 88,500 TK, Coke spent 5, 00,000 TK, Virgin spent 18, 58,000 TK, R C and Sun crest spent near about 23, 00,000 TK for this two month. This is the highest budget of the history of Sun crest for the T V advertisement. The reason behind this was recently they had launched a new pack size in the market. This is totally a concept for the Bangladesh beverage market. The newspaper advertisement ratio of Pepsi, R C, Sun crest and Virgin was available for the month of September to November. As I mentioned earlier that Coke Company is divided in to two-production operation in Bangladesh. The government owned part had not spent a lot for the advertisement in the recent year 2005.
On the other hand Pepsi as usually spends more than 2, 00,000 TK per month for the newspaper advertisement. Pepsi gives 19 ads in different newspaper and spent 19, 00,000 TK. in the month of October they spent most because of Eid-ul-Azah.
Virgin spent 05, 55,000 TK for the month of October and November. In these two months, they spent a lot for the business promotion. In the month of October, it was winter, when beverage product becomes a bit slow. In the month of November, they tried to promote, the Cheers, which are Mango flavored. They offered one glass with every three cans of the Cheers.
Recently Sun crest spent more then 15, 00,000 TK in different newspapers. In the month of November, they had launched 250 ml PET bottle. For introduction of the new product, they spent the special amount of money.
R c spent only 75,600 TK, their amount is very low compare to others. They spent more on T V adds. Although they spent less for the newspaper but their advertisement is not few in this media. They gave the sponsorship for the laser –light show, which was first time in Bangladesh. So R C get the advertisement advantage from this laser show adds.
3.7 Most Preferred T V Channel for the Advertisement
In Bangladesh, we have four private and national T V channels. Only one of them is government owned. T V advertisement is a very powerful communication medium between companies and retailers and mostly with the sconsumers. According to the retailers, nTV is most preferred medium for them. 66% liked ntv, 25% BTV, 6% liked Channel I and others liked A T N Bangla.
3.8 Comparison with Fruit Drinks
There were no competitions of fruit drinks with the beverage products in last few years back. Recently the scenario is little different, because peoples are more aware
about the soft drinks, they are aware about the health. To cope up this problem beverage companies had started to increase the fruit flavored drinks more. Like Mango, Orange and lichi. For this reason, it could be said that there was no competition between fruit drinks and soft drinks. The children mainly liked fruit drinks.
Part -4. CONCLUSION
It was mentioned earlier that R C is a newly franchise company in beverage sector of Bangladesh. For this reason, it will take several years for the company to improve and to capture a healthy market share. Coke and Pepsi have a strong background internationally, which R C does not. Coke and Pepsi are the oldest beverage companies in Bangladesh. Therefore, the two companies’ management is much more experienced than that of the R C’s management.
In the advertisement sector, Coke and Pepsi get the readymade T V ads from their neighboring country India like “Yeh Dil Mange More”. India’s Coke and Pepsi companies give them the add to advertise in the T V. this is an era of information technology and satellite culture. So consumers specially who live in the city area, they can see the adds in different channels. This is an extra advantage for these two companies. That is why Coke and Pepsi do not need to spent extra money a lot for the commercial advertise making. They directly buy the ads from Coke and Pepsi Company of India. On the other hand, if R C wants to advertise their product on T V, they have to spend a big budget for making it.
Few companies like Virgin and PRAN emphasized on a specific side of the consumer segment. Foe example virgin targeted the young generation, those who are stylish and do not like to bother to carry the glass bottle. They offered the can system for them. Eventually they got a very good response from every segment of the consumer. The reason is they offered a can with in a reasonable price. PRAN emphasized on the fruit juice in 250ml glass bottle. On the other hand, R C tried to cover every segment of the consumers by offering the as many package size as possible.
In conclusion, it is apparent that, in order to compete with Coke and Pepsi, survive in the competitive market and continue to grow, R C needs to launch extensive marketing campaign.
ü R C bottle is not attractive like Coke. This is a vital weapon to attract the mind of consumers. Mineral water bottle of MUM could an example of this. R C should try to change their design of bottle.
ü R C introduce PET bottle for one and 1.5-liter bottle, this is a good sign. However, retailers are still bothering with deposit system of glass bottle of 300ml. R C should make plastic bottle for 300ml like Sun crest.
ü R C’s marketing objective should be like these-
Þ R C should be identified as a brand of quality and taste to the consumer.
Þ Ensure wide distribution through strong aggressive sales force through out the country.
Þ To fight back market leaders like Coke and Pepsi and gradually acquire market share from them.
ü R C’s advertising objective should be like these-
Þ To establish R C as a quality range of products with a different taste in the consumers mind.
Þ To make people aware of the R C brand name.
Þ To bust up the sales.
ü R C should do the following things in outdoor for extensive visibility, advertisement and reinforcement.
Þ Billboards and hoarding
Þ Shop planning
Þ Plastic sign
Þ Shop board
Þ Light board
Þ Van planning
Þ Neon sign
ü R C should arrange-
Þ Fashion show
Þ Drinking competition
Þ Sponsorship of youth/ sport related events
Þ Discounted sales in different clubs
ü R C should try the fountain drinks, as fountain beverage is preferred in terms of both taste and freshness.
ü In trams of media spending, Coke and Pepsi spend more then R C. R C can compete with them by spending more money in media to strengthen the image of their brand and then catch up with Coke and Pepsi.
ü For making T V ads R C can do the followings-
Þ If budget permits, R C can go for shooting in Mumbai, where R C gets the best quality production in this region.
Þ If not Mumbai then Calcutta can explore for better production quality than Bangladesh.
Þ Or else R C can shoot locally and go for postproduction in Mumbai or Calcutta, which would bring down the cost of production.
ü To increase the sales of R C’s bottles they can offer the following trade promotions for the retailers-
Þ R C can offer one colored T V to the retailers who can sell the highest number of bottles in a certain territory. They can announce the name of the person on a press release.
Þ Mystery shopper: A team from R C can visit the shops and find out where the retailer keeps more R C than others and at the same time try to push RC products. Then the team can offer him some gifts, like T-shirts, caps, wristwatch etc.
Þ If possible R C can offer four bottles free with one crate, which PRAN is still doing. This secretes of PRAN although they do not offer quality product to the consumers.
ü R C can offer the following promotional activities to the consumers-
Þ R C arranges different type of contest for the consumers. Some of them could be for the short time and could be for a long while. The example of short one could be like, R C team would visit different area and observe different shop and find out the best buyer from those area or territory. The best buyer could be recognized as a” R C person”. The long-term strategy could be one type of U T C program, which means under the crown program. Consumers have to collect a specific amount of unit to get a gift. Like T-shirts, travel bag, motor cycle, wrist watches etc.
Þ R C can offer the consumers a coupon with every 1.5-liter PET bottle. The consumers had to fill up the coupon and submit it to the retailers. The coupon would be about the information of RC. I it would increase the brand loyalty of RC cola. To achieving that, R C had to offer a big budget offer for the winner.
Þ Kids are the one of the vital segment of the beverage product. R C can focus them. For the kids R C can make small bottle of drinks. The pack size could be 2oo ml; the reason is some times children can not finish the 250 ml then their parents do not like to give then a bottle. Most of the time the parent give them a juice pack. More over they can offer stickers , chips, nuts etc with the small bottle.
|PRICE MARGIN||COKE||PEPSI||RC COLA||VIRGIN||PRAN||SUNCREST|
|COMPANY TO DISTRIBUTORS||176 TK||175 TK||170 TK||170 TK||175 TK||147 TK|
|DISTRIBUTORS TO RETAILERS||190 TK||190 TK||156 TK||156 TK||190 TK||164 TK|
|RETAILERS TO CONSUMERS||240 TK||240 TK||240 TK||240 TK||240 TK||216 TK|
DEPOSIT AGAINST CRATES AND BOTTLES
Þ FOR 250/300 ML BOTTLES
|DEPOSIT AGAINST CRATES||30 TK||30 TK||30 TK||30 TK||30 TK|
|DEPOSIT AGAINST BOTTLES||120 TK||