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LifeStraw Go in Ghana- Business Plan Presentation_2016Apr20
- 1. LifeStraw Go in Ghana: Business Plan Managing in the Global Marketplace - Cohort S55 Michael Appiah, Eric Backer, Erick Traille, Tim Warrick, Shawn Bielke
- 2. Agenda • Country Overview: Ghana • Ghana Water, Environmental Issues, and Sachet Industry • Product Overview: LifeStraw Go • Applications of product in Ghana • Marketing and Promotion • Distribution
- 3. The Republic of Ghana • 26,327,649 people (ranks 48th in the world) • Capital City: Accra • Active member of United Nations • 11 Government sponsored languages • 1.09 million foreign visitors annually
- 4. Geert Hofstede Cultural Orientation
- 5. Economic Overview • Currency: Ghana Cedi (GH₵) - 1 USD = 3.83 GH₵ • Key Sectors: Agriculture, Services, and Manufacturing PPP GDP GDP - per capita Avg. Monthly Disposable Salary Distribution of family income - Gini Index Ghana $113.3 B $37.68 B $4,300 $365 42.3 United States $17.97 T $17.97 T $56,300 $2,790 45 Ghana World Rank 81st na 175th 93rd 53rd
- 6. Ghana Water ● Water Situation in Ghana: ○ Lack of access to safe drinking water, especially those in poorer areas ○ The Ghanaian government is not able to keep up with the rapid expansion of cities ○ Water shortages due to uneven distribution of rainfall, drought, and poorly managed water resources. ○ Water sachets as their main source of drinking water ● Urban access to treated and piped water is 46 percent (roughly 6.44 million people of 14 million), ● Rural areas have only 35 percent
- 7. SWOT for Ghana Water Resources Strengths Weakness ● Vast amount of water resources ● Many entrepreneurs in the water sachet business ● Poor infrastructure with regards to clean water and sanitation ● Rapid expansion is proving too much for the government to keep up with piped water ● Water Shortages Opportunities Threats ● Infrastructure investments ● A collectivist culture ● Environmental Policy ● Corruption ● Water Tariffs ● A culture of high uncertainty avoidance and low long-term orientation ● Drought ● Lifestyle change to branded water
- 8. Ghana Sachet Industry • 500 ml disposable water packet • 3.65 billion units per year • 30 Sachets per bag (USD $1.50) (USD $0.05 per sachet) • Estimated Sachet market – USD $182.5 million • Unregulated Industry • Major contributor to pollution ▫ 270 tons of plastic waste per day
- 9. LifeStraw Go • Filters up to 1,000 liters (264 gallons) of water • Removes 99.9999% of waterborne bacteria & Parasites including E-Coli, Giardia, and Cryptosporidium • $29.95 ea - Southern Region • $24.95 ea - Northern Region • Follow The Liters Program
- 10. SWOT for LifeStraw Go Strengths Weakness ● Reusable ● Environmentally sound ● Cost effective in the long run ● Doesn’t produce water, just purifies ● Price is 7% of average monthly disposable income ● Ghana has high on uncertainty avoidance with extremely low long- term orientation Opportunities Threats ● Urban and rural increases in available water sources ● LifeStraw Go can replace 2000 sachets, 100 dollars, or 2 kilograms of plastic from entering the environment per person ● Bottled water ● Sachets (Everpure, Ice Cool, Mobile, Standard Water, and Voltic) ● Piped drinking water
- 11. Pricing Strategy *Southern Region surrounding capital city of Accra and north to Kumasi *Northern Region surrounding Tamale and north to Bolgatanga Tiered Pricing Strategy by Regions and Channels Southern Region* - Retail Price Northern Region* - Retail Price Qty Price Discount Price Discount Buy 1 $29.95 ea base $24.95 ea base Buy 2 $28.45 ea 5% $22.45 ea 10% Buy 3 $26.95 ea 10% $19.95 ea 20% Replac ement Filter $18.95 ea $14.95 ea 20% Southern Region - Wholesale Price Northern Region - Wholesale Price Qty Price Discount Price Discount Buy 100 $14.95 ea Base (50% margin) $12.45 ea Base (50% margin) Buy 250 $14.20 ea 5% $11.85 ea 5% Buy 500 $13.45 ea 10% $11.20 ea 10% Replaceme nt Filter $9.45 ea $7.45 ea
- 12. Marketing Goals & Objectives Yr Objective 1 Penetrate 10% of the market of foreigners 2 Capture 10% of foreigner and urbanite market with access to fresh water 3 Achieve 7% penetration of the total urban market 4 Penetrate 7% of the market of urban and Rural Ghanians 5 Capture 10% of the entire Ghana population
- 13. Five-Year ForecastYear 1 Year 2 Year 3 Year 4 Year 5 Product Sold 109,000 (Based on 10% Foreigners) 753,000 (Based on 10% Foreigners and Urbanites) 980,000 1,960,000 2,700,000 Revenue (USD) @ $29 $ 3,161,000 $ 21,837,000 $ 28,420,000 $ 56,840,000 $ 78,300,000 Revenue (USD) @ $24 $ 2,616,000 $ 18,072,000 $ 23,520,000 $ 47,040,000 $ 64,800,000 Total Target Marget 7,530,000 (Foreigners and Urban people with piped water) 7,530,000 (Foreigners and Urban people with piped water) 14,000,000 (All Urban residents) 14,000,000 (All Urban residents) 27,000,000 (Total Ghana Population) Percent of Total Target Market 1.4% 10.0% 7.0% 14.0% 10.0% Percent of Final Market 0.40% 2.79% 3.63% 7.00% 10.00%
- 14. Promotion of LifeStraw Go Strategies: • Gorilla marketing • Community events • Philanthropy • Push/Pull tactics Campaign message: “Protect our environment & families – Drink with LifeStraw.”
- 15. Promotion: Gorilla Marketing • Donate 10 LifeStraw Go’s to each of the 56 embassies • Introduction letter highlighting mission • Promote campaign website as a resource: ▫ Studies on success in other countries ▫ Plot water sources ▫ Tracking trouble pollution areas (community forum) ▫ Organizing community events (community forum)
- 16. Promotion: Community Events • Sponsor clean up events ▫ Supported by LifeStraw ▫ Initiated by community • Provide materials for cleaning up • Product giveaways and sales
- 17. Promotion: Philanthropy • Provide safe drinking water to schools across Ghana • Include information on LifeStraw Go that students can take home and share with families
- 18. Promotion: Pull Tactics • 30 Second radio advertisements • Focus on mission and cost savings • Promotional material for resellers • One Lifestraw Go replaces 2000 sachets, saves $100, and prevents 2 kilograms of plastic from entering the environment.
- 19. Product Placement and Distribution • Place in and near transportation hubs for easy visibility • Placement in 560 shops located in capital cities • Brand Ambassador Program • Regional Distribution and Training Centers
- 20. Conclusions • Provide safe and environmentally friendly access to water across Ghana • Radio Advertisements, Store displays, targeted giveaways, and Brand Ambassador program • Reach 10% of population after 5 years “Protect our environment & families – Drink with LifeStraw.”
- 21. Any Questions???
- 22. References CIA World Factbook - Ghana: https://www.cia.gov/library/publications/resources/the-world-factbook/geos/gh.html Disposable Income: http://www.numbeo.com/cost-of-living/country_price_rankings?itemId=105 Ghana 2013 Census Data: http://www.statsghana.gov.gh/ Hamline Proquest NewsStand: (Hamline.edu>>Bush Memorial Library>>Databases>>Databases by Name>>ProQuest Newsstand http://search.proquest.com/newsstand/advanced?accountid=28109 Climate change causes acute water shortage in ghana. (2016, Feb 18). IANS English Retrieved from http://search.proquest.com/docview/1766094895?accountid=28109 ECC wins $400 million water rehabilitation project in ghana. (2012, Sep 01). PR Newswire Retrieved from http://search.proquest.com/docview/1037529320?accountid=28109 Ghana's oil production causes water shortage in second port-city. (2012, Jun 27). Xinhua News Agency - CEIS Retrieved from http://search.proquest.com/docview/1022454281?accountid=28109 Bottled water study http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&ved=0ahUKEwjt5- ajsIXMAhWlwYMKHXUtC9UQFggvMAE&url=http%3A%2F%2Fwww.ccsenet.org%2Fjournal%2Findex.ph p%2Fijms%2Farticle%2Fdownload%2F48792%2F28726&usg=AFQjCNHRNHgYzDygocRDBs051ftCwfh YMA&bvm=bv.119028448,d.amc&cad=rja Water sources Stoler, J., Weeks, J. R., & Fink, G. (2012). Sachet drinking water in Ghana’s Accra-Tema metropolitan area: past, present, and future. Journal of Water, Sanitation, and Hygiene for Development : A Journal of the International Water Association, 2(4), 10.2166/washdev.2012.104. http://doi.org/10.2166/washdev.2012.104 http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3842094/ LifeStraw Go Website: http://lifestraw.eartheasy.com/products/lifestraw-go Little, R. J. (2015). The State of Sachets: Ghana's private sector solution to a public infrastructure problem. Retrieved from http://scholarship.claremont.edu/cgi/viewcontent.cgi?article=1063&context=pitzer_theses Okioga, T. (2007). WATER QUALITY AND BUSINESS ASPECTS OF SACHET-VENDED WATER IN TAMALE, GHANA. Retrieved from http://web.mit.edu/watsan/Docs/Student Theses/Ghana/Thesis - Tesha Okioga 5-18-07.pdf
- 23. References Continued...Demand for water per day http://www.water-for-africa.org/en/water-consumption.html Udoh F (2012) Nigeria: sachet water business generates N7 billion daily – NAFDAC. All Africa. http://allafrica.com/stories/ 201204200996.html Interview: Financing, pollution hinder adequate water delivery in ghana. (2014, Mar 22). Xinhua News Agency - CEIS Retrieved from http://search.proquest.com/docview/1509432328?accountid=28109 Tourism in Ghana http://data.worldbank.org/indicator/ST.INT.ARVL http://www.ghanaweb.com/GhanaHomePage/NewsArchive/artikel.php?ID=257863 Carson O'Keeffe Satterfield, 2010 https://www.modernghana.com/news/282397/going-green-in-ghana.html http://metromass.com/tour-ghana https://www.modernghana.com/ghanahome/estates/?menu_id=37&sub_menu_id=715&gender=&cat_id=143&has_price=1 http://easytrackghana.com/travel-information-ghana_local-transportation.php Price for radio ad. http://www.gbcghana.com/images/ratecard2013.pdf Foreign Visitors http://data.worldbank.org/indicator/ST.INT.ARVL and http://www.ghanaweb.com/GhanaHomePage/NewsArchive/artikel.php?ID=257863
Editor's Notes
- SHAWN
- SHAWN Shawn - introduce the team and our country. Michael - slides 3-5 > all about Ghana Backer - slides 6-8 > frame the problem Shawn - slides 9-13 > product intro, price & goals Tim - slides 14-17 > promotion Eric - slides 18-20 > promotion, distribution, & conclusion
- MICHAEL Ghana is a constitutional democracy in western Africa with a population of 26,327,649 people (ranks 48th in the world) in an area lightly smaller than Oregon. 54% of the population lives in an urban area (roughly 14 million people). The capital and largest city of Ghana is Accra, which has a metropolitan area population of about 4 million inhabitants, making it the 11th largest metro area in Africa. Ghana is active in the United Nations and many of its specialised agencies, the World Trade Organization, the Non-Aligned Movement, the Organisation of African Unity (OAU), the African Union (AU) and the Economic Community of West African States. 11 Government Sponsored Languages Ghana gave over 42,000 foreigners residence permits in 2015 and has roughly 1.09 Million foreign visitors annually.
- MICHAEL
- MICHAEL GDP (Purchasing Power Parity) is $113.3 billion as of 2015 est, GDP (official exchange rate), $37.68 billion as of (2015 est.), GDP - per capita (PPP) $4,300 as of (2015 est.), Agriculture accounts for roughly one fourth of the country's GDP and employs nearly half of the workforce. The services sector accounts for about half of the GDP. Ghana is a free market country with tax incentives for first time investors. Ghana is a member of WTO, IMF, World Bank, ECOWAS, etc, there are standard trade and investment policies to encourage investors to the country.
- ERIC B
- ERIC B
- ERIC B One growing trend in the water industry of Ghana, are Sachets. Sachets are 500 ml disposable water packets that have varying levels of filtration or disinfection. People like them because the quality is perceived to be higher than water from the tap and the price is relatively low. Rough estimates put the size of the sachet market at around 3.65 billion sold per year nationwide and a bag of sachets (30 per bag) sell for 2 Ghana cedis, or about 50 cents USD. This puts the estimated spending on sachets by Ghanaian people at 182.5 million USD per year. (Satterfield 2010) (Compared to Nigeria estimates of USD$44.5 million per day (USD$16.24 billion annually)). There have been some attempts to regulate the sachet industry, but efforts have been relatively unsuccessful, meaning water quality is not adequately controlled. Sachets also account for a large portion of the plastic waste and pollution in the area
- SHAWN The LifeStraw Go is portable ultralight 22 ounce water bottle that filters and removes 99.99% of waterborne bacteria and Parasites, including E-Coli, GIardia, and Cryptosporidium. One Water Bottle can filter up to 1,000 liters of water from streams, lakes, and even puddles, without electricity, batteries, or replacement parts. We have regionally specific pricing due to geographical income gaps between the northern and southern regions of the country, this will allow us to reach a broader market by making our product more accessible to a larger target market. Lifestraw Go is one of many water filtering devices under the LIfestraw brand. The company’s follow the Liters program provides clean drinking water to a student in need in a developing country for every product they sell. To date, they have reached 631 schools and provided 361,000 students with clean drinking water
- SHAWN
- SHAWN
- SHAWN
- SHAWN
- TIM Ghana is also a collectivist culture and their commitment to family, extended family and extended relationships offers significant opportunity for the LifeStraw product. With a mission centralized around taking care of others and the environment, our campaign message will resonate throughout the community.
- TIM Members of the Ghana society are accepting of high power distance and hierarchical order. In an effort to leverage this, LifeStraw will utilize a gorilla marketing push strategy to donate 10 LifeStraw Go’s to each of the 56 embassies in Ghana. Brief letter highlighting our mission for sustainability, the environment, and the support of school children with safe drinking water. Assuming these members are among the 28% of Ghana residences with internet access, the letter will also promote our campaign website. Benefits: political and public awareness of our product and the positive impact it has, bringing additional attention to a serious problem and offering support with a sustainable and affordable product. As these members use our product in the community, others will notice and through word of mouth, the awareness for our product will spread.
- TIM The site will also offer an online thread that can be used to call attention to specific locations with significant waste from sachets and other plastics. Users can then organize and promote community gatherings here to help clean up the waste. Using this data, the LifeStraw team of brand ambassadors will have a presence at these impromptu events with cleaning materials and LifeStraw Go product giveaways and sales.
- TIM staying true to our mission, all sales of the LifeStraw Go will help provide safe drinking water to schools across Ghana. Donations will be accompanied with a small card the students can take home. The card will highlight our campaign message “Protect our environment & families – Drink with LifeStraw,” on one side and an infographic showing how much money can be saved by replacing sachets with the LifeStraw Go.
- TRALLE The campaign message will also be supported with pull tactics by leveraging radio advertisements throughout Ghana. Radio is the number one media and advertising channel in Ghana, with 86% of homes having access to the technology. Ads will briefly highlight the LifeStraw mission and the problem it’s solving for, but also focus on the significant financial savings a family can achieve through the use of the product. The ads will close with the central campaign message to, “Protect our environment & families – Drink with LifeStraw.” To further reinforce our central message, all resellers will be given promotional material to present alongside our product. This will include a banner that highlights the campaign message followed by a simple graphic that shows how one LifeStraw Go can replace 2000 sachets, 100 dollars, or 2 kilograms of plastic from entering the environment per person. The simple but powerful message will reinforce the problem facing Ghana, but also emphasize the financial value they carry.
- TRALLE We will focus on placing the product in transportation hubs such as international Airports in Accra and Kumasi, train stations throughout the southern region, and bus stations, which will allow us to achieve maximum geographical and target market reach. We will also look to place our product in or near hotels that see a large amount of foreign visitors. In addition, LifeStraw Go will be sold amongst the 560 shops found at shopping malls throughout the capital cities. Like the Accra Mall pictured here on the right which is one of the biggest and most modern malls in Western Africa. The LifeStraw team will work to build a network of brand ambassadors to market and sell the product throughout their respective rural communities. These ambassadors will serve as product experts, but also the community reseller. Ambassadors will receive a $2 commission on every LifeWater Go bottle or replacement filter sold. This micro targeted licensed marketing strategy will allow maximum exposure within the rural communities and support from individuals who understand their market best. By providing support and incentives to our ambassadors, we believe we can attract strong talent that will take ownership of their work. To improve efficiencies in the distribution of the product, we will have one warehouse in the southern region located in the capital city of Accra and another in the northern city of Tamale. The locations will house all product and promotional material to support sales in that respective region. In addition, the locations will serve as a training center for new brand ambassadors and resellers of the product.
- TRALLE To summarize, our plan is to enter the Ghana market with the Lifestraw Go, a personal water bottle filtration device. Our research indicates a strong need for access to portable, clean drinking water for residents throughout the country. Our product will not only help keep Ghanains healthy, but also help keep enormous amounts of waste from polluting the environment. Using both push and pull tactics in radio advertising and our brand ambassador program, we plan to reach 10% of the population within five years time.
- ERICK T
- ERICK T
- ERICK T