CASE ANALYSIS

case about
Akbar Iqbals terms for joining as country head of

Tomaiki Foods:
Look at India as an opportunity to grow a category Look at the bottom of the pyramid Not transfer products from its existing portfolio Look for a Made for India strategy to:

Create an Aha Effect

5-FORCES MODEL
Rivalry: Large Indian companies (growing from SMEs) MNCs Indianized New entrants: New MNCs SMEs Substitutes: Unorganized sector Buyers: Huge market at the bottom of the pyramid:
o o

Growing rural market Small towns

Suppliers

Symptoms, Problems, Issues

Symptoms: Success stories abound:

Sauces market growth post Nestles entry Rasna Haldiram Papads - Lijjat Potato chips Uncle Chipps Masalas MDH, Everest,.. Pastes Pickles Nirlon, Bedekar

Problems
MNCs and large Indian companies not looking at this

prospect Risk averse Merely looking at adapting existing products Not willing to take the effort to understand the consumer Inadequate Marketing Research techniques to understand consumers Resistance of consumers to change their mindset to learn how to adopt new kitchen appliances No serious attempt to develop appropriate technologies

Issues
Offer Indian consumers something to create an Aha

effect, with:
Made for India strategy

Or

Continue with their existing strategy, and offer their

foreign products

OPPORTUNITIES & THREATS

Weights
.20 .10 .10 .05

Ratings
4 4 3 3

Weighted score
0.8 0.4 0.3 0.15

Opportunities Large nos. (B.O.P.) Few brands Low penetration of existing ones Rising incomes Threats Low purchasing power Time no constraint Competition SMEs Lack of infrastructure Consumer mindset Local substitutes

.15 .10 .10 .05 .05 .05 .05 1.00

3 2 3 3 2 2 2

0.45 0.20 0.30 0.15 0.10 0.10 0.10 3.05

STRENGTHS & WEAKNESSES

Weight Strengths Global brands (V, I) Huge resources (O) Professionalism (O) Wide experience (O) Weaknesses Mindset of MNCs Inappropriate MR Think Small New entrant Products undecided Entry strategy undecided .15 .15 .10 .05 .15 .15 .10 .05 .05 .05 1.00 Rating 4 4 4 3 2 2 3 3 3 3 Score 0.6 0.6 0.40 0.15 0.30 0.30 0.30 0.15 0.15 0.15 3.10

STRATEGIC FACTOR ANALYSIS SUMMARY

Weight (O) Large nos. (BOP) .15 (O) Few brands .10 (O) Low penetration .05 (T) Low purchasing power.10 (T) No time constraint .05 (T) Competition .05 (T) SMEs .05 (T) Lack of infrastructure .05 (S) Global brands .10 (S) Huge resources .10 (S) Professionalism .05 (W) Mindset of MNCs .10 (W) Inappropriate MR .05 (W) think Small .05 1.00

Rating 4 4 3 3 2 3 3 2 4 4 3 2 2 3

Score 0.60 0.40 0.15 0.30 0.10 0.15 0.15 0.10 0.40 0.40 0.15 0.20 0.10 0.15 3.35

SW

OT

Large numbers of (BOP) Few brands Low penetration of existing ones

Low purchasing power Time not a constraint Competition SMEs Lack of infrastructure Mindset of consumer

SW

Global brands Huge resources professionalism

Mindset of MNCs Inappropriate MR Think small

OT Large numbers of (BOP) Few brands Low penetration of existing ones Low purchasing power Time not a constraint Competition SMEs Lack of infrastructure Mindset of consumer

SW

Global brands Huge resources professionalism

Mindset of MNCs Inappropriate MR Think small

OT

Large numbers of (BOP) Few brands Low penetration of existing ones

NPD Educate consumers Discover unmet needs

Low purchasing power Time not a constraint Competition SMEs Lack of infrastructure Mindset of consumer

SW

Global brands Huge resources professionalism

Mindset of MNCs Inappropriate MR Think small

OT

Large numbers of (BOP) Few brands Low penetration of existing ones

NPD Educate consumers Discover unmet needs

MR techniques Entrepreneurial approach MNC mindset

Low purchasing power Time not a constraint Competition SMEs Lack of infrastructure Mindset of consumer

SW

Global brands Huge resources professionalism

Mindset of MNCs Inappropriate MR Think small

OT Large numbers of (BOP) Few brands Low penetration of existing ones NPD Educate consumers Discover unmet needs MR Techniques Enterprneurial approach MNC mindset

Low purchasing power Time not a constraint Competition SMEs Lack of infrastructure Mindset of consumer

Offer value PPP Use unconventional media

SW

Global brands Huge resources professionalism

Mindset of MNCs Inappropriate MR Think small

OT

Large numbers of (BOP) Few brands Low penetration of existing ones

NPD Educate consumers Discover unmet needs

NPD Educate consumers Discover unmet needs

Low purchasing power Time not a constraint Competition SMEs Lack of infrastructure Mindset of consumer

Offer value PPP Use unconventional media

Start from rural Educate

Tomaikis strengths
Global brands
Resources: Capital R&D Professional competence: Experience in other markets NPD competence

Implications
Risk taking ability
Backed by: Resources Knowledge Innovative skills Experience across markets

SO
Capitalize on the huge potential at the Bottom of the

pyramid thru NPD Educate consumers to use existing cooking devices & products

MARKETS

Small towns

Rural

OPPORTUNITIES

Extending usage of Demo & education to Demo & education to cooking products/devices encourage: adapt existing - usage of modern products/devices cooking appliances - adapting recipes - ingredients for cooking

New product development

New recipe Developing RTCs Ingredients for cooking

Innovation: - appropriate technology - products

Research on food habits

1971 & 1981 Mrs. Goodyear, BMRB research
1984 Gallop-MBA research on processed food

Findings MBA-Gallop
Mothers pestered by their children, seeking: 1) Taste 2) Variety 3) Convenience 4) Creativity

Success Stories
Maggi noodles, Fryums
MDH, Everest masalas, pastes

Not ready-to-eat foods, which even today has very little

acceptance

1990s to date successes

Haldirams Namkeens
Kurkure Bingo

Rise of small towns in India

2000 Ernst & Youngs report: Significant consumption expenditure of *KUT vis-vis the Metros Increasing affluence levels with a larger relevant consumer base Increasing reach of retail & malls Increasing reach of media & favourable media consumption patterns
*Key urban towns

Tomaikis SCAs
Pre-emptive move
Differentiation Building brand Resonance