Water Bottling company: Product and pricing Romeo Joson Module 3 Assignment 2 Product levels Thinking of a product, designing it and then finally introducing and selling it in the market isn’t a simple process. It is a continuous process. There are three basic levels at which a product exists. 1. Core level 2. Actual level 3. Augmented level A product doesn’t exist physically at core level. It is just a concept at this stage. Core level is the level where one just chalks out the features of the product, what will be the competitive edge of the product and how will the product make and sustain its place in the product. Once the manufacturing process completes, the product exists at actual level. Before being able to exist at actual level, the core level product has to undergo certain decisions regarding several aspects e.g. quality, quantity (in some cases), brand, fashion etc. Whereas augmented level is that level of the product which isn’t physical (Friesner, 2014) In our case, the core level product is to provide clean and drinkable water at economic rates, not only at shops but at the doorsteps of the people as well. The actual level of the product will be the water packed in the bottles. The augmented level of the product in our case will be the bottles of water available at the shops and stores as well as the gallons of water delivered at the doorsteps of the people. Product life cycle Each product has a definite life span, after which it becomes redundant or obsolete. For example, there was a time when wired telephones were used all over the world. Then they started becoming redundant and were replaced by chord less phones. Mobile phones replaced chord less phones and now technological advances are leading towards the era where we’ll not see mobile phone in its traditional role. So from being created to being redundant, each product has to pass through different stages which are as follows 1. Introduction 2. Growth 3. Maturity 4. Decline We’ll now discuss these stages in detail and see how are they related to pricing in general and to our case specifically. 1. Intorduction Introduction phase of a product is a beginning phase. Branding of the product is accomplished as well as quality is established in this phase. Prices in this phase are either kept such that the product may just be able to penetrate the market or reasonably high so that the product may recover the costs incurred during the development. Distribution is done in a selective manner and promotion is limited to those people, stores and institutions etc. which are potentially quick adopters. The annual bottled water consumption in USA was 9107.3 in 2011 (Rodwan Jr., 2011). This means that daily consumption of bottled water in USA was about 24.95 million gallons. Considering that the increase in bottled consumption was between 2-4% in most of the previous years, we may assume that the consumption of bottled water in 2015 is not likely to exceed 30%. So we aim to.

1. Water Bottling company: Product and pricing
Romeo Joson
Module 3 Assignment 2
Product levels
Thinking of a product, designing it and then finally introducing
and selling it in the market isn’t a simple process. It is a
continuous process. There are three basic levels at which a
product exists.
1. Core level
2. Actual level
3. Augmented level
A product doesn’t exist physically at core level. It is just a
concept at this stage. Core level is the level where one just
chalks out the features of the product, what will be the
competitive edge of the product and how will the product make
and sustain its place in the product. Once the manufacturing
process completes, the product exists at actual level. Before
being able to exist at actual level, the core level product has to
undergo certain decisions regarding several aspects e.g. quality,
quantity (in some cases), brand, fashion etc. Whereas

2. augmented level is that level of the product which isn’t physical
(Friesner, 2014)
In our case, the core level product is to provide clean and
drinkable water at economic rates, not only at shops but at the
doorsteps of the people as well. The actual level of the product
will be the water packed in the bottles. The augmented level of
the product in our case will be the bottles of water available at
the shops and stores as well as the gallons of water delivered at
the doorsteps of the people.
Product life cycle
Each product has a definite life span, after which it
becomes redundant or obsolete. For example, there was a time
when wired telephones were used all over the world. Then they
started becoming redundant and were replaced by chord less
phones. Mobile phones replaced chord less phones and now
technological advances are leading towards the era where we’ll
not see mobile phone in its traditional role. So from being
created to being redundant, each product has to pass through
different stages which are as follows
1. Introduction
2. Growth
3. Maturity
4. Decline
We’ll now discuss these stages in detail and see how are they
related to pricing in general and to our case specifically.
1. Intorduction
Introduction phase of a product is a beginning phase. Branding
of the product is accomplished as well as quality is established
in this phase. Prices in this phase are either kept such that the
product may just be able to penetrate the market or reasonably
high so that the product may recover the costs incurred during
the development. Distribution is done in a selective manner and
promotion is limited to those people, stores and institutions etc.
which are potentially quick adopters. The annual bottled water
consumption in USA was 9107.3 in 2011 (Rodwan Jr., 2011).
This means that daily consumption of bottled water in USA was

3. about 24.95 million gallons. Considering that the increase in
bottled consumption was between 2-4% in most of the previous
years, we may assume that the consumption of bottled water in
2015 is not likely to exceed 30%.
So we aim to capture the 2% of the US market in the
introductory phase. For this we’ll have to keep our daily
production between 1500-1700 gallons in normal conditions.
The average price of bottled water per gallon was 1.22 dollars
in USA in 2013 (Boesler, 2013). Considering the inflation from
2013 till date, we may assume that the average price of bottled
water would be 1.30 dollars per gallon in 2015. So to make the
price our competitive edge, we decide to keep the price of a
single gallon 1.15-1.20 dollars per gallons during the
introductory stage. To combat the effects of inflation, we intend
to keep the price increase not more than 4-6% per annum during
the introductory phase. The introductory phase may last from 1
to 2 years.
2. Growth
During the growth stage the product has lesser risks to face as it
has already been consolidated itself in the market. So prices
may be increased slightly during this phase and a broader
audience may be reached as well by carrying out distribution
and promotion at bigger levels than the previous ones.
Following these general guidelines for growth stage, we may set
our production target to increase by 25% during the growth
stage per year, in a compounding manner for first three years of
the growth stage. After three years, our annual production of
bottled water will be nearly 3100 gallons per day. To align with
a pre-supposed increase in demand and production, we may set
our annual increase in price to be between 15-20% in a
compounding manner, for first three years. So after three years
from the start of the growth stage, the price of one gallon of
water will be about 2.00 dollars or slightly higher.
3. Maturity
Maturity is the peak stage of a product’s life cycle. Reaching
this stage, product’s growing sales start diminishing. We expect

4. that the growth stage will last for at least five years. So at the
start of the maturity stage of the product, the price of one gallon
of water is expected to be somewhere around 3 dollars and the
production is likely to be near 5000-6000 gallons per day. This
means that we are expecting the production to increase by 3-4
times within a time span of 7 years. That sounds quite
reasonable. This phase (maturity) is the stage where we intend
to keep the prices relatively as stable as possible. Our prime
focus during this stage will be to maintain the market share in a
competitive environment
4. Decline
Decline stage of a product cycle is that stage in which the sales
graph keep declining to bottom line and touches it eventually.
Once the decline phase is reached, the product may be either
reintroduced with improvisations pr lower cost or it may be
discontinued by liquidating the inventory left behind. One way
to cope with decline stage may be to sell it to some other firm.
It is not right for obvious reasons to set the time span of the
maturity and decline stage, therefore we have avoided it.
BCG matrix
Above figure represents BCG of our case. We intend to focus
primarily on 1 gallon packing. We want to keep the major share
of 1 gallon packing of bottled water in our hands. 500 ml bottle
will be introduced in such capacity that it may grow in a quick
manner but we’ll not be eyeing to capture the major market
share as the competition in this category is already tough. We
intend to introduce 1 litre packing as well with major market
share of this type since there aren’t many bottlers who offer this
packing. The least important from the perspectives of both
growth and market share is 2.25 litre packing. This will be
introduced on a very limited scale and the prime target for this
packing will be the medium distance travelers etc. who can’t
carry a gallon with them for certain reasons.
Services marketing
Services marketing means the marketing process of a service

5. offered by any business. The necessary characteristic of a
service is that it is intangible. In our case, the concerned service
may be the sale of bottled water. Our main objective in
marketing our service i.e. sales is to increase them as per pre-
planned annual targets while maintaining the quality
Price determination and pricing strategies
Pricing is a complex process in itself. If the supplies fail to
meet the demands the prices go higher whereas on the other
hand the competition between different stake holders forces
them to lower the prices as much as possible by keeping their
businesses alive. Our prime objective for price determination is
to not only penetrate the market from scratch but to consolidate
and grow the share of our product in the market as much as
possible for as much years as possible. We’ll achieve this
through following pricing scheme:
During the introduction phase, our pricing strategy will be
chiefly penetrative pricing as discussed before. Penetrating
pricing implies introduction of a product or service at low rates
so that it may consolidate itself in a highly competitive market
by generating fair sales volumes (Pricing strategies, n.d). Once
our brand and product is consolidated, we’ll be using
differential pricing as well. We’ll do so by providing a little
discount to big stores on bulk orders. During later phase of
growth stage and initial phase of maturity stage we’ll benefit
from the principle of supply and demand as much as possible by
remaining competent and affordable enough to stay in business.
References
· Tim Friesner. 2014. Three levels of product. Retrieved from:
http://www.marketingteacher.com/three-levels-of-a-product/
· Jhon G. Rowdan, Jr. Bottled water 2011: The recovery
continues. Retrieved from:
http://www.bottledwater.org/files/2011BWstats.pdf

6. · Matthew Boesler. 2013. Bottled water costs 2000 times as
much as tap water. Retrieved from
http://www.businessinsider.com/bottled-water-costs-2000x-
more-than-tap-2013-7
· Pricing strategies. n.d. Retrieved from:
http://iust.edu.sy/courses/Pricing%20strategies%20new.pdf
1 lite
1 gallon
2.25 litre
500 ml
Market Research & Targeting
Romeo Joson
M2 A2
Market Research
Research Methods & Data Mining
In getting information about water bottling, the research
methods that were used include talking with people, literature
searches, focus groups, telephone surveys, personal interviews,

7. email surveys, mail surveys and internet survey. The literature
searches involved all the readily available materials that
included newspapers, magazines, and annual reports. It included
meeting with prospects, suppliers, customers and trade showers
(Zikmund, Babin, Carr, & Griffin, 2012).
During data mining, information was derived by analyzing data
from diverse perspectives and then summarized it into more
useful information. The information can be used to cut costs of
operation, increase revenue or both. In essence, this can be used
to analyze data for the customers buying the bottled water for
WCB (Zikmund, Babin, Carr, & Griffin, 2012).
Market Research Process
The market research process is a method that is used for
informing decisions. It involves:
Problem definition: this is the most important part of the
process which defines the goals of the project. The root
question that needs to be addressed by the market research is
presented. This is the fundamental business problem that needs
to be acted upon (Weinstein, 2013).
Research Design: after having the object of research, it is the
high time to obtain the necessary data. The design is used to
determine the market research method and how to identify and
choose the sample. The choice of instrument is on the basis of
the nature of data.
Preparation of research instrument and design: it is the time to
develop the tool of research. One begins to write question and
design a questionnaire. The question is prepared and the
material to execute the plan.
Data Collection: this is the administration of the survey,
conducting interviews, running the focus groups, and
implementing the field test. The observations, answers, and
choices are recorded and collected in a spreadsheet form
Analyzing Data-Data is spread on a spreadsheet for further

8. analysis. This is done to ensure that it is structured properly.
Summaries with tools are presented, and graphs and tables are
built.
Data Visualization and Communication of results: The data is
compiled to make t meaningful and make it accessible for
presentation. The business questions and recommendations
based on the data and issues that arose are addressed.
Consumer Behavior
B2C vs. B2B
The business leaders should comprehend the difference between
B2Cand B2B. B2C involves various personas such as
demographics, segments and geographical nuance of the
customers of their help in determining how to manage and
position the brand to appeal to masses. B2B involves the
company trying to understand the customers as well, but the
path taken is different. B2B buyer has experience and expertise
in the offering being considered.
Consumer Decision Making Process
Problem Recognition: The need must be established, and this
happens when there is a lag between the actual situation of the
user and the desired and ideal one. Nevertheless, not all the
needs end up as the buying behavior.
Information search: Once there is the identification of the need;
it is the time for the consumer to search for information to seek
information about feasible solutions pertaining an individual
problem. He will search less or more information depending on
the complexity of choices made but also the level of
involvement.
Alternative evaluation: once the information is collected, the
consumer gets a prerequisite to evaluate diverse alternatives,
evaluate diverse most suitable to the needs and choose one that
is best for him.

9. Purchase decision: The consumer has evaluated diverse
solutions and the available products to respond to the need; he
will have the prerequisite to choose the brand or product that
seem which seems most appropriate.
Post-purchase behavior: once the purchase of the product is
made, the consumer evaluates he adequacy with the original
needs and whether he has made the right choice in buying the
product or not.
Factors Affecting B2C and B2B consumer behavior
The consumer purchase is influenced by social, cultural,
psychological and personal characteristics.
Cultural Factors: The cultural factors exert a profound and
broad influence on the consumer behavior. The marketer needs
to comprehend the role that is played by subculture, social class
or culture. WCB needs to consider the perceptions, basic values,
behaviors and wants to be learned by the member of the society.
They must also consider the social class; the division that exists
in the society in order to market bottled water (Hande, Ghosh,
& Govil, 2015).
Social Factors: the behavior of the consumer is influenced by
family social roles and family groups. Groups that have a direct
influence such as those of the age group will change the buying
behaviors. The role of a family influences the buying behavior
in purchasing the products (Hande, Ghosh, & Govil, 2015).
Personal Factors: the decisions of the buyer are influenced by
individual factors such as lifestyle, economic situation,
personality and self-concept. The occupation of a person affects
the goods and services bought. Thus understanding the
occupation of the given market segment is essential in
determining the buying behavior
Market Segmentation
Market Segmentation Concepts

10. Market segmentation is of interest in marketing since all the
customers are not alike. Treating them equally will make them
dissatisfied. The theory of mass marketing include the economy
of scale, and the marketer have discovered that is the mass
market was divided into smaller and homogeneous groups these
smaller segment could be better satisfied (Kraenzlin & Nellen,
2014).
Segmentation Process
The process of segmentation involves:
· Establishing the sample of customers that will act as a
representative of diverse makers that are found in the specified
market.
· Personal details are recorded about the decision makers that
can help in the identification of them.
· The next process is understanding the real needs of the
customers and listing the benefits sought.
· The micro-segments are brought together that illustrate similar
patterns of importance.
· Finally, the concluding clusters are verified and regarded as
segment
Segmentation Strategies
Segmentation is an integral part of the company’s marketing
strategy. The strategies break down the larger target market into
smaller, homogenous groups of the customers that one can
market to. Both the business and consumer oriented entities
should segment the customers together. With demographics,
WCB will divide the larger market to small groups based on
race, gender, age, occupation, marital status education and
income (Kraenzlin & Nellen, 2014).

11. The geographic location is used to sell services and products
specific to a certain region. Psychographics is used to identify
consumer based on the activities and interests of demographics.
The behavioral strategy is based on the behavior of the user.
Finally, business segmentation is a strategy that includes the
geographic, customer based and customer type that includes
consumer segmenting, business size, and the nature of the
business (Kraenzlin & Nellen, 2014).
Target Marketing
Target Marketing involves breaking the market into segments
and then concentrating the efforts of marketing on one or fewer
key segments. It is fundamental to attracting the new business
and making the small business a success. Targeting makes
pricing, promotion and distribution of service and products
(Kraenzlin & Nellen, 2014).
Reference
Kraenzlin, S., & Nellen, T. (2014). Access policy and money
market segmentation. Journal of Monetary Economics.
Zikmund, W., Babin, B., Carr, J., & Griffin, M. (2012).
Business research methods. Cengage Learning.
Hande, P. V., Ghosh, D., & Govil, A. (2015). A Comparative
Study on Factors Shaping Buying Behavior on B2B and B2C E-
Commerce Platforms in India. Journal of Marketing and
Consumer Research, 8, 53-58.
Weinstein, A. (2013). Handbook of market segmentation:
Strategic targeting for business and technology firms.
Routledge.
Marketing Plan: Waters Bottling Company
Romeo Joson
M1 A3

12. The Waters Bottling Company (WBC)
Introduction to Marketing
Marketing Mix
The water bottling company is comprised of the following
approaches to distribution, pricing, promotion and distribution
and the customer service
Pricing: The scheme of pricing is designed greatly to undercut
the cost incurred per gallon of the purified water when
compared to the bottled water. The pricing will be competitive
with other filtration systems that are currently in the market
(Halinen, 2012)
Distribution: WBC will be responsible for product distribution
of bottled water to the home of the customers. It is the
expectation that the route delivery person will have an
approximate of 40 deliveries per day or an amount equivalent to
400 per month. One of the delivery people will be added when
the number of the monthly deliveries will be required at the
start and addition delivery will be added if the monthly
deliveries exceed 1600 which is more of anticipation at the end
of the four month of the business (Halinen, 2012).
Advertising and Promotion: The business model of marketing
will be based on networking. This will rather be done in the
context of a diverse community organization that WCB is active
in. WCB intends to advertize the free trial offers by radio ads,
door hangers, and the coupon packages. The existing
competitors do not invest in advertising thus leaving the market
open to WCB.
Customer Satisfaction: This element of the marketing mix will
be attended to with utmost attention. One premise of the
business model is generating sales based on prior actual
relationship. Thus, WCB will ensure total customer satisfaction
in order to safeguard future sales as well as maintaining a
contact. To support customer retention, WCB will offer better
products at favorable price (Armstrong, Adam, Denize, &
Kotler, 2014).
The Marketing Environment

13. Following the flood that happened in Munsonville, the water
supplies are still suspected making many residents turn to the
bottled waters for health reasons. Nevertheless, even before the
flooding, the demand for bottled water was growing
Potential Customer: Since the delivered water is relatively
inexpensive, any household virtually can afford the bottled
water at their homes. The cost of rent cool is $10 per month
where an average family drinks about 20 gallons per month
which amount to 4 to 5 bottles with a total monthly cost of
about $30.
The size of the Market: Bottled water covers an area of about
17,571,067 gallons per year.
Competition: The operational environment of this company aims
to counter attack about 12 bottled distributors listed in
Willmenia yellow pages. Nevertheless, just seven companies are
engaged actively in office and home delivery of the drinking
water. The other five companies are the sales equipment of the
sales. The three largest competitors are Crystal water, Nakuwell
water, and blue spring waters.
Marketing and other functional areas of business
WCB is connected with other bottle companies. WCB depends
on Bot bottles entirely on the production of the bottles. The
company is in agreement with Bot bottling. Bots’ product
liability insurance covers such claims against WCB. WCB will
thus carry their insurance that is inclusive of $1 million
umbrella liability policy. WCB will offer various water coolers
to rent their customer base that is inclusive of a standard floor
models or counter top models that offer choices if cold, hot and
cold water, cold water only, cold water dispensing and room
temperature.
Strategic Marketing
Planning Process
Distilled, spring and purified water is bottled by WCN of

14. Willmenia, who fills the five gallon bottle that is labeled with
its sparkling horizon logo. The refillable plastic bottles will be
collected from the customers when empty and then returned to
WCB biweekly for refilling and cleaning. Plastic is the
preferred bottling package since it is unbreakable, lightweight
and inexpensive to ship and produce.
In the planning process, the company will operate from
approximately 2,500 sq. Ft of the warehouse space in Willmenia
with a particular portion of the area being set aside for office
space. WCB is presently working with the country officials in
order to negotiate and identify the lease on an appropriate site.
Once WCB achieve the customer base of 3,00 or 12,000
deliveries bottles per month, the company will investigate
investing in equipment to bottle water house. An investment of
$250,000 would be required to purchase the bottling equipment.
The company will have a management team that will make all
the decisions pertaining the decision making of the business. In
the same regard, WCB is composed of a strong marketing team
that plans for the marketing activities, identify new market,
distribution and ensure customer satisfaction
The plan is based on leveraging the personal contacts where
some will become customers while others will get the interest of
joining the organization as a lower level of the networking
structure. Having this in mind, WCB will increase their
participation in many different organizations.
Strategy
Organizational Levels:
The owner and the founder, Dr. M Waters bring years of
experience in bottling water and delivery to the company. His
family has operated the business for a while now. The
combination of the blue music in advertising is aimed to be
inclusive in the adverts
The two key managers have been retained in a bid to enhance
expansion and operations. ABI will serve as the operations
manager while JEAN WATERs will be the route driver and the

15. crucial position as the point of customer contact. In addition,
there are two commission sales associates who will be hired to
secure the customers
Goals and Objectives
Goals: Provide the customers with the finest quality water
infiltration units. WCB exists to maintain and attract new
customers. The goal is that in adhering to this, WCB will be the
market leader in bottling water and exceed the expectations of
the customers.
Objectives
Marketing Objectives
· Increase the referral of the customers by 4 percent a quarter
· Generate, 11 percent increase of the customers, turned
associates per year
Financial Objectives
· 70 percent of the revenue stream to come from the recurring
revenues by three
· Then WCN aims to double the digit growth rate for every
successful year
Planning Gap
Ethics in Marketing
Despite the efforts of WCB to provide bottled water, there is a
need to find ways to get people out of contaminated water. In
fact, it is evident that no matter the affordability of the water,
many people still use the contaminated water. As much as the
company needs to market the products, it is necessary that the
people be educated on the consumption of safe waters to reduce
the diseases that affect many people. Some people lack water,
and we need to find ways of helping them as a corporate social
responsibility (CSR). The social contribution of nonprofit brand
should be encouraged (Tsalikis & Fritzsche, 2013)
References
Armstrong, G., Adam, S., Denize, S., & Kotler, P. (2014).

16. Principles of marketing. Pearson Australia.
Tsalikis, J., & Fritzsche, D. J. (2013). Business Ethics: A
literature review with a focus on marketing ethics. In Citation
Classics from the Journal of Business Ethics (pp. 337-404).
Springer Netherlands.
Brei, V., & Böhm, S. (2011). Corporate social responsibility as
cultural meaning management: a critique of the marketing of
‘ethical ‘bottled water. Business Ethics: A European Review,
20(3), 233-252.
Halinen, A. (2012). Relationship marketing in professional
services: a study of agency-client dynamics in the advertising
sector. Routledge.