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Cpg casestudy
This document provides an overview and recommendations for how a consumer goods company can improve its market share in China from 6% to 10% within 2 years. It outlines key factors to consider, including understanding market trends, identifying top product categories, analyzing competitors' strategies, and developing a winning strategy. The document then presents an issue tree to map out strategies for increasing market share through identifying new segments, improving distribution, boosting promotions, and addressing quality issues. References are also provided.
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Cpg casestudy
- 1. Seizing the CPGopportunity in China : By Muskan Tantia
- 2. ⢠Why areyou looking at the China Market ? (your business reasons) ⢠Do you understand what your USPs are? ⢠Have you evidence to show that a market exists in China for your Goods/service ?( market research) ⢠How do you propose to sell in China? ⢠Do you understand the geographic size of the market and know where to start. ⢠Who are the customers you wish to target (consumers, local companies, Foreign companies in China , or official bodies) ⢠Do you know how to carry out due diligence on customers/suppliers/partners.
- 3. ⢠Market trends â˘Winning strategy ⢠PSW ⢠ISSUE Tree ⢠Identify Top Category Product ⢠solution ⢠References Agenda
- 4. Life is digital-nearlythree quarters are online daily 500 million out of poverty in 20 years ,thus high spending power Difficult to drive loyalty-two third are willing to try new brands Mobile-commerce is increasingly popular,as is mobile payment Majority of consumers are e-shoppers Market Trends A âmeâ culture is prevailing Pragmatism still rules Aggressive store expansion is replaced by improving store productivity Insights based on market research
- 5. Child care Skin care Pet Nutrition TopCategory Product ? Hair care Small Appliances
- 6. Trends Hair Care slower valuegrowth in 2015 than in the previous year standard shampoos enjoyed very high product penetration in the country Skin Care mainly used by the young consumers willing to spend money on facial care at an earlier age, compared to the old generations, who may have higher disposable incomes. Child Care high growth, due to the comparatively huge number of newborns and rising disposable incomes Change in the One-Child Policy by government and allowed to have two children. Pet Nutrition High growth within Pet food in 2015, Reason â performance of new products within premium Pet food that were in line with the health and wellness trend. Small Appliances Smart rice cookers are increasingly favoured Growth of 5% in 2015, due to the high growth of new Western small appliances To identify the top category Product
- 7. Hair Care 4% volumeCAGR over the forecast period (hair care is a relatively mature category in beauty and personal care) The major driving factor â consumersâ trading up to high-end products, such as premium conditioners Skin Care 9% volume CAGR over the forecast period The major driving factor â the rising demand for better and healthier personal image Child Care premium brands of baby and child- specific products are expected to widen their presence (manufacturers are planning to enrich their product portfolios) The major driving factor â the number of wealthy people is rapidly on the rise Pet Nutrition Pet products is expected to record a slightly higher performance The major driving factor â increasing pet populations Small Appliances 4% volume CAGR over the forecast period The major driving factor â Consumers prefer to purchase high-end products offering premium quality and manufacturers will raise quality and technological advancements Future Scope
- 8. Hair Care P&G continuedto lead , with a value share of 40% Strategy â The rapidly-growing online sales channel, thanks to its rich product portfolio Outcome â managed to penetrate less- tapped rural areas Skin Care LâOreal took comfortable lead , holding a value share of 12%. Strategy â new launches, profound nationwide distribution network and successful marketing Outcome â Enhanced its brand and product awareness Child Care Johnson & Johnson took the lead Strategy â acquisition of Elsker, Johnson & Johnson , âOriginated from nature, Love with Elskerâ Outcome â Enhanced the brandâs image Pet Nutrition Guangdong Boyu Group took the lead, holding a value share of 2%. Strategy â flexible sales strategy Outcome â well known and considered reliable by consumers Small Appliances Strategy â establishing a strong channel network and strategic cooperation(regional large electronics and appliances retailers) Outcome âconsumers have easy access to small cooking appliances Competitorâs strategy
- 9. Critical Success Factors Treat e-Commerce as atop priority and a source of explosive growth Invest heavily in distributor management and closely manage in- store execution Omni-channel approach M&A continues to be an attractive avenue fuelling growth Social media is used as a tool for customer loyalty Preference for high quality goods Product Development in Health and wellness concern products Winning Strategy
- 10. How can aclient XYZ, one of the largest and fastest growing consumer goods companies in the world, can improve its market share by volume in China from 6% to 10 % in the span of 2 years . 1. Background and context 5. Stakeholders ⢠The growth in various sectors is uneven(aging) ⢠Household incomes are continue to rise ⢠Urbanisation is creating a new consumer market ⢠2nd largest world economy ⢠Digital is reshaping consumer experience 2. Desired Outcome 4. Constraints ⢠Improved market share from 6% to 10 % in the span of 2 years ⢠Re-position the brand strategy ⢠Improve the frequency of purchase ⢠Introduce new customers to the brand ⢠Economic Uncertainty/Volatility ⢠High Mkt Saturation ⢠Low switching Cost ⢠Tax Regimes ⢠Financial Budget ⢠Competitorâs data is not readily available ⢠Insights based on research, Past sales, channel Inputs ⢠Unbaised Customer feedback and profiling, Digital analytics ⢠Sales,Marketing,Analytics and Consulting teams ⢠Marketing & Sales Team ⢠Portfolio Managers ⢠Finance team ⢠Analytics Team ⢠In Scope : Analysis on specific market segments ⢠Out of Scope : Changing consumer behaviour 6. Resources Problem Statement Worksheet 3. Scope
- 11. How can ABCcompany increase its Market Share By volume, from 6% to 10% By Increasing share of preference/Sales Identify/Create new market segments Improving Distribution Increasing Promotion By Stopping Share of decline Understanding quality issues By Consumer Satisfaction and Feedback A2 A1 Issue Tree Scope Terminal Node Out of Scope / Constraint
- 12. Identify/Create new market segments Mergers/Acquisition BY Replicatingregional players success on large scale Analysis of Opportunity Market segments by Demographics Market segments by Geography Launching a new product A1.1 Issue Tree Scope Terminal Node Out of Scope / Constraint
- 13. By Increasing Shareof distribution Add new Distribution Channels Partnering With Ecommerce Direct sales Build more Retail Partnerships Increase Intensity of Each Channel Avoid multichannel Competition Increasing sales force Improving Logistics A1.2 Issue Tree Scope Terminal Node Out of Scope / Constraint Use Leverage Invest in Once U saturate one channel only move to another Direct Factory Shipping
- 14. By Increasing promotions Branding(conducting Branding analysis) Logosand Packing Design Visual Aids(Use of effective communication) Ergonomics TV Advertisements Digital Marketing Online Advertisements Mobile / Web Apps Print Media Issue Tree Scope Terminal Node Out of Scope / Constraint A1.3
- 15. By Stopping Shareof decline Understanding quality issues Services/Warranty Packaging Issues By Consumer Satisfaction A2 Issue Tree Scope Terminal Node Out of Scope / Constraint USE TQM,SIX SIGMA Get Unbiased Feedback
- 16. References ⢠http://businesscasestudies.co.uk ⢠http://createsend.com/ â˘Data from Euromonitor ⢠www.tradingeconomies.com ⢠www.mckinseyonmarketingandsales.com ⢠www.fractalanalytics.com
- 17. China is bringingfundamental change to all our lives â be prepared! Thank You !