Strategic Marketing Management

Ali Akbar Group

Table of Content
Executive Summary..........................................................................................................................................2
COMPANY ADDRESS...................................................................................................................................4
TELEPHONE...............................................................................................................................................4
FAX..............................................................................................................................................................4

HEAD OFFICE............................................................................................................................................4
MISSION STATEMENT.............................................................................................................................5
LPG PROJECT.............................................................................................................................................6
Segmentation................................................................................................................................................7
Definition..........................................................................................................................................................7
DEFINITION..................................................................................................................................................20
PARTS OF THE PRODUCT.................................................................................................................22
BRANDING...............................................................................................................................................23
Definition........................................................................................................................................................23
PACKAGING.............................................................................................................................................24
PRODUCT LIFE CYCLE..........................................................................................................................25
DEFINITION..................................................................................................................................................26
PRICE ADJUSTMENT TECHNIQUES................................................................................................26
BASIC PRICE SETTING APPROACH................................................................................................27
DEFINITION..................................................................................................................................................27
DISTRIBUTION LEVELS ...................................................................................................................27
DEFINITION..................................................................................................................................................29
ELEMENTS OF PROMOTION.....................................................................................................................30

1
Insecticide
Strategic Marketing Management
Ali Akbar Group

Executive Summary

This feasibility study is about project of an insecticide company which is already working

in Pakistan as Pesticide Company and the name of the company is “Ali Akbar Group”.

For the purpose we are studying different aspect of it to know about the business

environment and its exact requirement for better decision making in future. Ali Akbar

Group Company is in business sine 1993 and doing its job fine. It is neither registered

with Lahore Stock Exchange (LSE) nor KSE or ISE. The head quarter of the company is

at Lahore while it is working in all over Pakistan.

It is basically an pesticide company which is working all over Pakistan and now entering

into insecticide industry. Competitors of this company are Mortein, bygone, finis and

bayer.

The company is facilitating in pesticide industry with 48% of shares and is market leader.

Now they have decided to enter in to this industry with me too strategy to penetrate the

market. Brand name they have decided for the product mirage.

Pricing strategy they have adopted is marketing penetration pricing strategy.

2
Insecticide
Strategic Marketing Management
Ali Akbar Group

ACKNOWLEDGEMENT

In the name of thy Lord who created, man from clot.

Above all we indebted to Almighty Allah, lord of our lives and of every

thing in universe and his Holy Prophet Muhammad (PBUH) whose

blessing enabled us to perceive and pursuit higher ideas of life.

The repot of Internship is the result of our day and night efforts, which

we have made to, complete this very extensive and creative work.

I deem it a great honor and privilege to record our sense for gratitude to

respected teacher

Mr. Mobin-Ul-Haq

3
Insecticide
Strategic Marketing Management
Ali Akbar Group

COMPANY NAME

AAG

COMPANY ADDRESS
1-Km Bhoptian Chowk Defence Road, Off Raiwind Road, Lahore

TELEPHONE
92-42-5321461-5

FAX
+ 92-42-5321324-5

HEAD OFFICE
..1-Km Bhoptian Chowk Defence Road, Off Raiwind Road, Lahore
Email: [email protected]

Website: http://www.aliakbargroup.com/
INTRODUCTION OF THE COMPANY
4
Insecticide
Strategic Marketing Management
Ali Akbar Group

Ali Akbar Group (AAG) is Pakistan’s largest ago-chemical group of Pakistan and third
largest group in Asia. They are the market leaders in agro-chemicals section, providing
high quality products and services to their customers and franchisers.

MISSION STATEMENT

“Our Mission is to serve

the agriculture Sector of Pakistan by
providing high quality
tested products to our farmers through our enthusiastic, dedicated
employees And member Companies”

5
Insecticide
Strategic Marketing Management
Ali Akbar Group

BRIEF HISTORY
Ali Akbar Group based in Lahore is a diversified business group of below mentioned
companies:
 Ali Akbar Enterprises
 Pak China Chemicals
 Pak China Polymers
 Dada Jee Corporation
 4B Group
 Soneri LPG
Ali Akbar Group is amongst the top 5 crop protection companies in Pakistan. They
started marketing of agrochemical since 1993, as natural response to the opportunity
arising from the ever-growing demand for crop protection chemicals in Pakistan. First
direct sale was carried out at the end of 1993 with improved Methyl Parathion. They offer
a comprehensive range of products such as herbicides, fungicides, matricides and plant
growth regulators every year. Here our point of focus would be launching of a new
product in Fast Moving Consumer Goods section, Insecticides. They are entering into this
market for the first time.
LPG PROJECT

• Installation of LPG bottling Plant at Lahore.

• Sonari Gas is a project of Links International (Ali Akbar Group).
• Plant has storage capacity of about 180 M ton Gas.
• Plant has Production Capacity of 25 M ton per Day.
• Proper Marketing/distribution network has been developed all over Pakistan.

6
Insecticide
Strategic Marketing Management
Ali Akbar Group

Customer Analysis
Segmentation

Definition
“As way of dividing the total market into distinctive group with unique and
different wants for effective strategies and profitability.”
Basis of Market Segmentation
We are going to launch our product only in Lahore region at initial stage. For this
purpose, our target market will be females aging between 18-55 old house wives
who are the final decision makers in purchasing of many house hold items. Since
our product is also a house hold product so they would be our target market. As far
as segmentation is concerned, we have divided Lahore into A, B, C and D
categories. The detail for which is given below:

A = Defence and Cantt Area

B = Model Town, Garden Town, Township, Wapda Town, Faisal Town
C = Mughal Pura, Station, Garhi Shah, Bhaati
D = Raiwind Raod complete and related areas

We have said that the customer, who belongs to Township Area, will fall under our
Socio Economic Class B as mentioned above. In short we can safely say that we
have segmented our total market geographically and demographically.

Unfilled Wants and Needs

There is a gap where needs and wants of the consumers exist. We have identified
that the efficacy for the products available currently in the market have efficacy
ranges up to 24 hours maximum if sprayed once inside any house, where as we will

7
Insecticide
Strategic Marketing Management
Ali Akbar Group

enter into this market with efficacy up to 36 hours if sprayed once. So there is a
need against which we are going to launch our product.

Competitor’s Analysis
Competitor analysis is useful to provides us the picture of our competitors position in the
market, their weak spots if any, how can we bring in differentiation in our products and
creating our own competitive strategies.

When we go into the details of customer selection criteria, we found out that most of the
customer selects their products on the basis of their brand awareness, relatively lesser
customers also selects their products on the basis of referral marketing from the retailers.

The second question which arises how competitors segment the market? There are a
number of buying factors like performance, quality and price on the basis of which
competitors are segmenting the market, also they are segmenting the market on the basis
of high growth rate which is approximately more than 15 %.

The market shares of the major competitors are mentioned below: There are a number of
competitors but we are taking into consideration only 4 major competitors which can be
threat for us while competing into the market.

Mortein 39%
Baygon / Finis 37%
Kingtox 12%
Others 12%
The average sales volume for all above mentioned brands in Lahore are as follows:

Mortein 4 crore
Baygon / Finis 3.5 crore

8
Insecticide
Strategic Marketing Management
Ali Akbar Group

Kingtox 1 crore
These figures also stating that insecticide industry is very attractive industry in terms of
sales volume.

Competitive Evaluation Sheet

Factors Mortein Baygon Finis Kingtox

Product
Quality 4 5 5 3
Brand 5 4 3 4
Packaging 5 5 4 3
Sizes 5 5 5 4
Reliability 4 5 4 3
Price
List Price 4 4 4 5
Discounts 4 4 4 4
Payment Period 4 4 4 4
Credit Terms 4 4 4 4
Distribution
Direct Sales Force 3 3 3 3
Company’s Represen. 4 4 4 4
Distributors 4 4 4 4
Transport 4 3 4 3
Promotion
Advertisement 4 4 3 4
Demonstrations 3 3 3 3
Electronic Media 4 3 3 4
Print Media 2 2 2 2
Total Scores 67 66 63 62

After the detailed analysis of our competitors, we can easily say that we can work in
distribution system, prices promotion and product quality in order to enter into the market
as there is a lot of gap and needs to work on. We have our own LPG plant and keeping in
mind that LPG is main ingredient we can get competitive advantage on price as well
because we will produce directly from our plant. All other competitors mostly import the

9
Insecticide
Strategic Marketing Management
Ali Akbar Group

main ingredient or purchases from Nestle who also have LPG unit in Pakistan. Ali Akbar
Group is second group having LPG plant after Nestle in Pakistan.

Efficacy of Product:
We have found that the efficacy for the spray of Mortein lasts a full day, for Baygon and
Finis it lasts for almost 15 hours and for Kingtox it lasts for same as well. On the other
hand we are presenting our product with a big differentiation in the sense that efficacy of
our product will be more than 36 hours if sprayed once.

STANDARD SIZE AAG SIZE

300ml 350ml
450ml 500ml
600ml 700ml

So we are going to enter into this market with bigger volumes and lower prices than the
competitors along with amazingly high quality as compared to our competitors. These
two competitive advantages would be the key points of differentiation on the basis of
which we can compete.

The PEST Analysis of Insecticide Industry

The pest analysis of insecticide industry will give us an overall picture of what are
the macro variables / factors or the external factors which can affect the companies
operating in this industry. The four factors covered pest analysis is:
1. Political / Legal
2. Economic
3. Social-Cultural
4. Technological

Particulars Very Somewhat +/- Somewhat Very

10
Insecticide
Strategic Marketing Management
Ali Akbar Group

Positive Positive Negative Negative

POLITICAL & LEGAL FACTORS
Law and Order Situation *
Change of Govt. *
Govt. Protection *
Govt. Interference *
Insecticide Laws *
Weak Legal Structure *
Media Policies *
Foreign Affiliation *
ECONOMIC FACTORS
Taxes Imposed by Govt. *
Per Capita Income *
Industry Attractiveness *
Company Structure *
Bad Debts *

11
Insecticide
Strategic Marketing Management
Ali Akbar Group

Particulars Very Somewhat +/- Somewhat Very

Positive Positive Negative Negative
SOCIAL CULTURAL FACTORS
Company Popularity *
Customer Base *
Creativity *
Quality Conscious *
Services Provided *
TECHNOLOGICAL FACTORS
Foreign Companies Entering *
Use of New Equipment *
Creating Website *
Value Addition *

The PEST table shows the effect of above 4 factors and their respective variables on
different companies operating in this industry along five dimensions which are:

1. Very Positive
2. Somewhat Positive
3. Positive / Negative (no effect)
4. Somewhat Negative
5. Very Negative
After analyzing the PEST analysis of the industry, we have come to the conclusion
that overall this industry is operating in favorable circumstances and it would be
good chance for AAG to enter in new market in this field as well.

12
Insecticide
Strategic Marketing Management
Ali Akbar Group

Five Factor Porter Model

The competitive environment in which the company operates determines the
profitability and nature of competition. Both these variables are directly influenced
by developments in the competitive environment.

The model developed by Michael E. Porter has been most commonly used for
examining the competitive environment. The five factors in porter model are:

1. The threat of new entrants into the market

2. The bargaining power of the firm’s suppliers
3. the bargaining power of the firm’s customer
4. The threat of substitute product.
5. The intensity of rivalry among competing firms.

Together these forces determine the nature and extent of competition as well as
profit potentials and attractiveness of the industry.

1. Threat of New Entrants to the Market

For this industry the threat of new entrant is high. It is because of the fact
that any company who wants to enter this industry can easily enter by
keeping their commissions and other service charges comparatively lower
than the other company. The main ingredient of this product is LPG and it
can be easily available or can be easily imported if met the set criteria.

From the marketing stand point there are some companies with high quality
norms and have consistently exceeded the requirement of standards and they
sustain at the cutting edge in terms of technology, creativity and extra
services.

13
Insecticide
Strategic Marketing Management
Ali Akbar Group

Any new entrant coming into this industry will have to have the best brains
on its side because of the fact that there are many companies which are
already operating in the industry.

2. Bargaining Power of Firm’s / Company Suppliers

As far as bargaining power of suppliers are concerned, it is low because most
of the chemicals are directly imported from China. Anyone having strong
financial position may get this facility. The main ingredient in our product’s
case is LPG; we will use our own LPG for this purpose.

3. Intensity of Rivalry among Competing Firms

The intensity of competition among the competing companies is quite high. It
is due to the fact that as I have already mentioned that there are many
companies which are operating in this industry which give intensive rivalry
to other companies. There are few companies that are having major market
shares of the product that are, Mortein, Baygon, Finis, Kingtox and etc. All
other firms having brands like Tyfon, Power Plus, Cobra etc are holding
comparatively smaller chunks of market shares. In short we can say that the
competition is quite high here in this insecticide industry.

4. Bargaining Power of the Customer / Client

Bargaining power of customer is also very high in the sense that switching
cost is very low as well. They can easily switch off and change their product
ultimately causing any company lose their customer.

5. Threat of Substitutes
From our point of view threat of substitutes is very high. As we are planning
to get into the aerosol market only (spray cans) and all other competitors are

14
Insecticide
Strategic Marketing Management
Ali Akbar Group

having complete product range in their product line like coils, mats, powder
and phenyl. All these substitutes are used intensively by customers so we can
safely say that this is the only threat we need to take very seriously but not
considering the others factors of this model less important. Customer changes
their minds rapidly while purchasing any household item so we need to be
very careful.

The Switching Cost

The switching cost of the client is low because of the fact that there are many
companies which are operating in the current industry.

The five factor porter model can be shown with the help of the following table.

FIVE FACTOR PORTER MODEL

S.# Particular High Low

1. Threat of new entrant xxx
1. Bargaining power of firms supplier -- --

2. Bargaining power of customer xxx

3. The intensity of rivalry among competing firm xxx

4. Threat of substitutes xxx

a) Switching cost xxx

15
Insecticide
Strategic Marketing Management
Ali Akbar Group

ENTRY EXIT MATRIX

LOW EXIT HIGH

High Profitability and High Profitability and

Stability Instability
HIGH

ENTRY and Stability

Low Profitability Low Profitability and
Instability
LOW

Entry Exit Barrier

The entry exit barriers of the company who wants to operate in this industry are
discussed in the below mentioned diagram. Entry barriers of this industry are quite
high as high investment is involved. Also government rules and regulations are to be
imposed on import of certain chemicals so one needs to also cater this fact as well.
On the other hand as far as exit barriers are concerned, these are comparatively on
moderate side. One can exit at the option of losing all its investment if product is
not meant for success in the current industry.

16
Insecticide
Strategic Marketing Management
Ali Akbar Group

Putting the insecticide industry in the above matrix, following figure can be made:

LOW EXIT HIGH

Industry

HIGH

ENTRY

Strengths & Weaknesses ANALYSIS

LOW

It is used to evaluate how Packages measures up to a competitor’s organization. The

strength & weakness evaluation is intended to determine where Packages is weak or
where it is strong as compared with the competition.

SWOT Analysis
Strengths: (Internal)
• Strong Financial position
• Strong brands available with AAG
• More than ten different product offerings
• Good reputation among customers.
• Own distribution system all over Pakistan especially in rural areas

17
Insecticide
Strategic Marketing Management
Ali Akbar Group

• Second firm in this country having its own LPG plant after Nestle.
• Communication system is very strong among departments
• More than 600 mobile vans all over Pakistan
• Two power plants with 1200KV and 1500KV capacity
• New and latest machinery imported from China
• Market leaders in agro-chemical sector having up to 48 % market share in
Pakistan
• Job security is high
• Motivated and target oriented employees
• The involvement of Chief Executive also acts as strength because it is in the
benefit of the company as well as in the benefit of workers

Weaknesses: (Internal)
• No distribution access in most urban areas
• New entrants in FMCG’s
• No proper training system for the employees

Opportunities: (External)
• There is a slight gap in the market to fulfill customer needs as insecticides
currently available are not targeting all kinds of flying and crawling insects
• Market growth 20 %
• Arrival of new technology in LPG, all competitors are using Butane while AAG
will use Butane X that has high boiling point, preventing it from bursting up to 70
degrees.
• Potential to capture large market share
• Very few famous brands available in market i.e. we are going towards brand
building.

18
Insecticide
Strategic Marketing Management
Ali Akbar Group

Threats: (External)
• Shift in consumer habits to mostly use coils
• Existence of strong substitutes that are coils and mats
• Political instability in the country
• Imported brands entry into insecticide industry
• Price increase of raw material
• Many substitutes available for the current product
• Intense competition in the industry

GE Matrix

3
Market Attractiveness
(EFE)
2

4 3 2 1

Business Strength (IFE)

Analysis of GE Matrix

19
Insecticide
Strategic Marketing Management
Ali Akbar Group

Market attractiveness is shown on the vertical axis and Business strength is shown on the
horizontal axis, we have examined the companies SWOT (strengths, weaknesses,
opportunities and threat) and plotting the external and internal factors on the GE matrix.
AAG falls on the green area as shown in the diagram above. This category shows that
AAG should adopt growth strategies and use aggressive approach ahead as they are in the
green area of this matrix.

Now after study the GE matrix we can safely say that we can go for a new product
offering as AAG business is on growth stage and they should be able to handle the
pressure of launching a new product using its all resources. We have selected to go for a
single product market, after sometime we will opt for going into multiple product
marketing.

Product Mix
Effective in the conditions where there are insects and provides complete protection
against the diseases spread by all flying and crawling insects.

PRODUCT
DEFINITION
“Anything that can be offered to the market for attention, use, acquisition or
consumption that may satisfy a need or a want may be termed as product.”

From this company, we have chosen a product which is aerosol. Aerosols are
containers containing chemicals and other materials that are kept under pressure and
useful against insecticides. Every product is divided into consumer base or
industrial base. The product we have selected to go for is true for consumer markets
and it’s a FMCG used by many households. If this product is for warehouse then it

20
Insecticide
Strategic Marketing Management
Ali Akbar Group

is industrial good and if this product is used by the household then it is consumer
good.

It is also an emergency good as well because when crawling and flying insects
increase then it is being used by the households for immediate relief from the
insects.

21
Insecticide
Strategic Marketing Management
Ali Akbar Group

PARTS OF THE PRODUCT

Core Part

Actual Part

Augmented Part

1. CORE PART
It presents utility, benefit and satisfaction to the households. It increases the
care when it sprayed in house, schools, university and any place. When
protection from insects increases, definitely customer will be satisfied. In the
core part of the product we meant basically for its effectiveness or
functionality for which it is being made.

Benefits:
Our spray will be odorless rather it will be available in a sweet aroma smell
which makes customer to buy without delay.

2. ACTUAL PART
 Mirage is a killer of flying & crawling insects. Here important point
of focus is its raw materials and the spray itself

22
Insecticide
Strategic Marketing Management
Ali Akbar Group

3. AUGMENTED PART
 Its brand name is mirage.
 High quality product
 Prices & size option which we proposed for customers are 350ml (Rs
76) 500ml (Rs 112) & 700ml (Rs 154).
 This spray can is coming in multi color having green, red & yellow
color.

BRANDING

Definition
“Any sign, symbol, name insignia used to identify the company or its
product/services may be termed as brand”.

Branding

Brand Mark Brand Name

Brand name of this product is Mirage.

Mirage has brand recognition; we are offering termite proofing medicines as well
with this brand and this would be our brand extension as well.

23
Insecticide
Strategic Marketing Management
Ali Akbar Group

Every customer who has insects at their homes must have ideas about the
insecticides. So this is brand recognition.

It is also a brand insistence, because it provides expected results so customers insist

to buy Mirage. It has a good brand name.

PACKAGING

Definition
“Packaging includes all activities of designing and producing the container or the
wrapper of the product”.

Parts of Packaging

Primary Packing Secondary Packing Shipping Packaging

1. Primary Packaging
The primary packaging would be a spray can and get it wrapped up by a
colorful printed plastic paper on which its method of application, directions,
ingredients etc will be given for the convenience of customers.

2. Secondary Packing
The plastic foil cover the wrapper is known as secondary packing.

3. Shipping Packaging

24
Insecticide
Strategic Marketing Management
Ali Akbar Group

The corrugated box containing the 12 boxes of this product is called shipping
packing which helps in transportation during the delivery the product.

BASIC INGREDIENTS
The basic ingredients for our product are as follows:
LPG 97 %
Poison 2%
Permethrin 1%

PRODUCT LIFE CYCLE

There are four stages of product life cycle:

1. Introduction
2. Growth
3. Maturity
4. Decline

This product is now on development stage because it is about to launch and if we

study the insecticide market then we identify that the industry is at maturity stage
still with much potential for the new entrants.
We have three different ranges in the product that are 350ml, 500ml and finally 600
ml. We have adopted an approach to go for large quantity with slightly lower prices.
Here important point to mention is that all competitors are offering standard sizes in
the industry that are 300ml, 450ml and 700ml. Here we have adopted slightly
different approach to cater the interests of our valued customers.
When we discuss its life cycle, we will be having lower price with high quality
strategy at development stage, then at maturity stage we will try to build our brand

25
Insecticide
Strategic Marketing Management
Ali Akbar Group

name and our focus would be to maintain quality, at decline stage we will start
immense advertisement and promotion and we will re-position our product before
get into the declining stage.

PRICE
DEFINITION
Buyer’s point of view:
“The amount of money that the buyer is willing to pay and pays in the price.”

Seller’s point of view:

“The amount of money at which seller is willing to sell and sells in the price.”
After having detailed analysis regarding our product, we are going to use
penetration price strategy for the upcoming product as we are not going to compete
in the market with full product range. The full product range includes aerosols that
are spray cans, coils, mats, powder and phenyl. We are only entering into aerosol
market so we will use “me too” for entering into the market.

PRICE ADJUSTMENT TECHNIQUES

The final prices for our product line would be as follows after analyzing the
competitors and their strategies:

Product Sizes 350ml 500ml 700ml

MRP Rs.76 Rs.112 Rs.151

The basis for the price determination and cost calculations are given below in detail.

26
Insecticide
Strategic Marketing Management
Ali Akbar Group

BASIC PRICE SETTING APPROACH

The company has set the price as cost and pricing. We are going to use cost pricing
technique to calculate our final prices that are given above:
350ml 500ml 700ml
Labor Rs.8 Rs. 14 Rs. 23
Material Rs. 30 Rs. 50 Rs. 70
Overheads Rs. 15 Rs. 15 Rs. 15
Full Cost Rs. 53 Rs. 79 Rs. 108
Incremental Cost Rs. 38 Rs. 64 Rs. 93
Conversion Cost Rs. 23 Rs. 29 Rs. 38

Margins Given to Distributors 12 %

Margins to Retailers 10%
Manufacturer’s margin 8%

We had our own LPG unit so that we can produce in-house and propellant or LPG is
the main ingredient of aerosols. All other competitors are importing LPG from
China etc and we have a competitive advantage here over our customers as we can
adopt the penetration strategy. For our customer the main cost element is LPG.

PLACE
DEFINITION
“Define as a set of independent / interdependent, individual or organization that
ensure the moment of goods from manufacturing to end user to satisfy the needs
and wants of the target market”.

DISTRIBUTION LEVELS
We are going to use traditional distribution channel as given below:

27
Insecticide
MFC Distributors Retailer End User
Strategic Marketing Management
Ali Akbar Group

As far as our competitors are concerned they are using below mentioned distributors
in Lahore.

MORTEIN
Mortein have selected Butt Brothers as their sole distributor in Lahore, they are
based in Gulberg Lahore. Their owner name is Mr.Abdul Waheed and as per
discussions with Mr. Tahir, one of their Operations Manager, we have found out that
in Lahore only Butt Brothers are giving them business of almost 4 crore on average
per month which means they area doing pretty good and keeping the Mortein brand
up in the industry. Then Butt Brothers distribute their whole product line all over
Lahore. One thing we have identified that company is not using their own delivery
system to the hyper markets like Metro, Makro and many other Mega Stores in
Lahore. They can only get the delivery from the distributors.

BAYGON / FINIS
As these brands are manufactured and imported by SC Johnson so they have
selected Sales Care Distributors for their Lahore region. We found very difficulty in
getting this information but after conducting interviews from retailers we found the
names of many order takers and ultimately they provided us their details. They are
based in Garhi Shah Lahore. On average they are giving around 3.5 crore of
business to they company. They are the challengers to the Reckitt who have
Mortein and Mortein is the market leader in the insecticide market. Also important
point to mention here, this company is also not using their own delivery system to

28
Insecticide
Strategic Marketing Management
Ali Akbar Group

the hyper markets and many large stores in Lahore, we can keep this point in view
while selecting out distribution system with competitive advantage.

KING
Their sole distributor in Lahore region is Spot Distributors. According to our
assessment and meetings with Mr. Arshad, Manager Operations, we have identified
their average sale is around 1 crore in Lahore sector. They have many other strong
brands as well.

OUR CHANNEL SELECTION METHODOLOGY

After having detailed analysis of all our major competitors we have identified that
we are going to use our channel same as of our competitors that’s manufacturer to
distributor and then finally to retailers and consumer. We will create our value here
for all the hyper and mega markets that we will be providing our own company
delivery system to all mega stores and hyper market area of Lahore. By adapting
this strategy we will be able to leave less geographical area for our distributors so
that they could penetrate and cater each and every retailer all over Lahore. We have
decided to go with new distributors who have distributions of many good brands all
over Lahore but not in same capacity that is insecticides. We are going to work with
Chaudhry Brothers who are currently dealing in distribution of air fresheners and
they have strong relationships in Lahore markets with retailers as well.

PROMOTION
DEFINITION
“Define as all activities through which the company’s organizations or firms
communicates with the rest of the world.”

29
Insecticide
Strategic Marketing Management
Ali Akbar Group

ELEMENTS OF PROMOTION
We are going to launch this product very soon for that we’ll utilize ATL approach.
Over here we’ll use electronic media like T.V, billboard, magazine and hording. To
make customer aware of our product we’ll start advertising forty (40) days before
the launch of product. Through out promotion scheme we’ll taught customer what’s
the product all about, how they can get benefits out of this product and what is
competitive edge in this product to attract more customer. With this approach we
can increase out sales revenue by attract more customer to over product.

Forecasted Sales Plan

Sizes 350ml 500ml 700ml

Final Price 76 112 151

Keeping in mind that we are going to offer a new product we can assume its average sales in Lahore
per day is 200 units, considering if we go for 150 A and A+ category stores, if they sell 2 pieces on
average, total number of units sold were 300, it means 33900 units sold on average all over Lahore.
Current
Year Rs. 2010 2011 2012 2013
Expected
Sales 12,204,000 13424400 14766840 16243524 17867876
Cost 8,542,800 9,397,080 10,336,788 11,370,467 12,507,513

Gross Profit 3,661,200 2376000 2613600 2874960 3162456

Salaries 500000 550000 605000 665500 732050
Other
Expensis 400000 440000 484000 532400 585640
2,761,200 1,386,000 1,524,600 1,677,060 1,844,766
Tax @ 16 % 441792 249480 274428 335412 368953.2

Net Profit 2,319,408 1,136,520 1,250,172 1,341,648 1,475,813

We expect 10 % rises in prices and all other factors for future sales forecast for the same product

30
Insecticide
Strategic Marketing Management
Ali Akbar Group

The above mentioned plan is only for aerosols that are spray cans only. In 2010, we are
going to add coils to our product line and in 2011; we will add mat and phenyl range to
our product line. We will not enter into complete product market as we are using “me
too” strategy so that first of all we will enter into this category of product one by one
having penetration strategy.

FUTURE TRENDS AND COMPETITOR’S RESPONSES

Now the main point o discusses here that after our launching of aerosol product, what
would be our major competitor’s strategies, how they will be responding to our strategy
and what additional features they can bring into this product. As we are going to launch
our product softy into this market, competitors can bring new technology in future like
they can come up with products having more efficacy using quality chemicals as raw
material. Here in their expected response we would like to mention that already we are
using quality raw materials and as we have already an established research and
development department who keeps on working into new technology. So that we have no
threat in future if they bring changes in technology as well because we are the first local
manufacturer of this scale in whole Pakistan. Using our R&D strength we can
continuously have an eye on changing technology and adopting before our competitors.
As we have a larger network of vehicles all over Pakistan, so we will be using our own
distribution system when we will enter into the rural areas target market.

HOW TARGET MARKET WILL CHANGE

Now, we are going to analyze how our target market will change in future with addition
of new products. We would like to mention here that as we have discussed earlier in
segmentation part that our main target market will be female’s ages between 18-of years
old who are the purchase decision makers in houses. They will be our primary focus
throughout. Only point to add here is we may target this product at institutional level as
well but it depends on our success of the product. When we will get into the market of

31
Insecticide
Strategic Marketing Management
Ali Akbar Group

coils we will target main rural area of Pakistan as well because in most the rural areas
instead of spray cans people like to use coils and mats and we will use our extensive
distribution channel of around 600 vehicles to cover such large target market.

In short after conducting, customer analysis we identified our target market and we
segmentation, after that we performed competitor analysis to identify our major
competitors, their strategies, weaknesses and strengths and we identified our areas of
differentiation from our products. We conducted a detailed environmental scanning and
found the industry attractive enough to enter into the FMCG’s market.
Then we performed internal analysis to identify our major weaknesses and threats and
found our AAG to go for growth strategies so we diversified our business and planned to
go for a new product, the brand name for which we selected is Mirage, an extension of
our another product. Then we discussed about product, its packaging, pricing strategies,
promotion methods and finally distribution channels. After that we forecasted our sales
and prepared and sales plan for next five years. Our product is different from our
competitors from the following stand points:
• We have offering larger sizes with high quality products.
• As far as efficacy of the product is concerned we are on upper side from our
competitors
• We have a slightly different channel of distribution in the sense that we will
deliver our product directly to hyper markets and many mega stores via our own
delivery system.
• As we have a larger network of vehicles all over Pakistan, so we will be using our
own distribution system when we will enter into the rural areas target market.

32
Insecticide