SMM Final Project

Strategic Marketing Management Final Project
Table of Contents
ACKNOWLEDGEMENT ................................................................................................................................... 3 EXECUTIVE SUMMARY .................................................................................................................................. 4 PAKISTAN MILK INDUSTRY ............................................................................................................................ 5 INTRODUCTION TO THE MILK INDUSTRY...................................................................................................... 6 CURRENT SITUATION OF PAKISTAN MILK INDUSTRY ................................................................................... 7 PAKISTAN MILK INDUSTRY COMPARISON WITH OTHER INDUSTRIES OF WORLD ....................................... 8 PEST ANALYSIS .............................................................................................................................................. 9 POLITICAL .................................................................................................................................................. 9 ECONOMIC .............................................................................................................................................. 10 SOCIAL ..................................................................................................................................................... 11 TECHNOLOGICAL ..................................................................................................................................... 11 PROCESSED MILK INDUSTRY ....................................................................................................................... 12 PORTER ANALYSIS ....................................................................................................................................... 13 ENTRY BARRIERS ..................................................................................................................................... 13 COMPETITOR RIVALRY ............................................................................................................................ 13 SUPPLIER POWER .................................................................................................................................... 13 THREAT OF SUBSTITUTION ..................................................................................................................... 14 BUYER POWER ........................................................................................................................................ 14 OUTLOOK OF LIQUID DAIRY PRODUCTS INDUSTRY IN PAKISTAN .............................................................. 15 MARKET SHARE OF TETRA PAK MILK BRANDS IN PAKISTAN ...................................................................... 17 NESTLE MILKPAK ......................................................................................................................................... 18 Company Vision ...................................................................................................................................... 18 Company Mission .................................................................................................................................... 18 Nestle MilkPak ........................................................................................................................................ 18 Competitors ............................................................................................................................................ 19 Competitive Advantage .......................................................................................................................... 19 Market Segmentation of Nestle MilkPak ................................................................................................ 20 Targeting ................................................................................................................................................. 20 Positioning Strategy ................................................................................................................................ 20
Analysis of Pakistans Milk Industry
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Situation Analysis .................................................................................................................................... 21 Market Trends......................................................................................................................................... 21 Market Potential ..................................................................................................................................... 21 SWOT Analysis (Nestle MilkPak) ............................................................................................................. 22 Marketing Mix ......................................................................................................................................... 23 Marketing Strategy ................................................................................................................................. 23 OLPERS MILK .............................................................................................................................................. 24 Vision....................................................................................................................................................... 24 Core Values ............................................................................................................................................. 24 SEGMENTING TARGETING AND POSITIONING ....................................................................................... 25 Segmenting and Targeting the Market for Olpers ................................................................................. 25 Positioning the Brand.............................................................................................................................. 26 SWOT Analysis......................................................................................................................................... 27 Marketing Mix ......................................................................................................................................... 30 Future plans ............................................................................................................................................ 34 Haleeb Milk ................................................................................................................................................. 35 Vision Statement ..................................................................................................................................... 36 Mission Statement .................................................................................................................................. 37 Values ...................................................................................................................................................... 37 Products .................................................................................................................................................. 37 SWOT ANALYSIS ...................................................................................................................................... 42 PREMA MILK ............................................................................................................................................... 44 Overview ................................................................................................................................................. 44 Current Scenario of UHT and Pasteurized Milk Market .......................................................................... 44 SWOT Analysis......................................................................................................................................... 45 Target Market ......................................................................................................................................... 46 Pasteurized Milk Market ......................................................................................................................... 47 Distribution Strategy ............................................................................................................................... 47 CONCLUSION............................................................................................................................................... 49 REFERENCES ................................................................................................................................................ 50
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ACKNOWLEDGEMENT
With all the praises for Almighty Allah, the creator of this universe who guides us to overcome the difficulties in the crucial situations and all the respects for Holy Prophet (SAW), who enables us to recognize our creator and understand the philosophy of life. This project is a synergistic product of many minds. We want to pay tribute to our worthy teachers who are the main source of enlightenment for our minds. We are thankful to them as they prepared us for looking at the matters of life widely with open minds. For us this project is one of the sources of knowledge about the Strategic Marketing Management. We are especially thankful to our honorable teacher Mr. Syed Rashid Hussain, who provided us guidance inspiration suggestions and encouragement that helped us in all the time of research for and writing of this project. In the end we would like to thank UMT for allowing us the course which helped us in building our minds to the right track towards professionalism.
Marked By: ___________________
Marks: ________________________
Date: ________________________
Grade: ________________________
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Strategic Marketing Management Final Project EXECUTIVE SUMMARY

Pakistan with current estimates is the 4th largest milk producing country in the world with 33 Billion liters of milk produced annually. The potential is huge but the sector operates mostly in the informal economy and needs a consistent effort to formalize and be able to contribute better to the national economy. Out of the total milk produced, 97% is in the informal sector (i.e. loose milk consumed in the villages and or sold in the cities through "Gawalas" in unhygienic conditions and without any quality standards). There are 8 Million farming households in Pakistan with a total herd size of 50 million animals. 97% of these farmers are not linked to formal markets and hence are not progressing in economic terms. Moreover, the overall animal herd of Pakistan is thinly spread across thousands of square kilometers with an average of 2 to 5 animals per household. Dairy farming practices are very old and traditional and need overhauling. To formalize and improve the industry, a private sector led Pakistan Dairy Development Company has emerged with guarantee backup by government of Pakistan. . The platform proposes to improve the dairy sector through improved research facilities, training and capacity building of farmers, training veterinarians, improving the cold chain through milk chillers, promoting healthy pasteurized milk, develop model commercial dairy farms, focus on breed improvement, facilitation of credit financing to dairy farmers and linking the rural area based farmer to the market mechanism. This will improve and formalize the dairy sector. The milk industry is targeted to achieve an annual production of 40 billion liters of milk by 2015, it aims to create an additional 3 million jobs in the formal economy and provide an estimated 350 million rupees per day in cash flow to farmers in the sector or to say that an additional formal economy of 3 Billion US$ will be developed for the rural economy. The potential is there but needs technical support from the industry, strategic support from dairy experts, policy and infrastructure from the government and specific projects funding from the international donor agencies. The potential is estimated on the basis of the fact that livestock and agriculture sector contributes over 10% to the GDP, and a milk economy that in value terms is 27.7% of the total agriculture sector. It is an untapped market, expected to grow an additional 3 billion liters in the next few years at a growth rate faster than most sectors, and 30% by 2015.
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Strategic Marketing Management Final Project PAKISTAN MILK INDUSTRY

Brands like Milk Pak (owned by Nestle) and Haleeb Milk (from Haleeb Foods) had led the dairy market in the worlds fifth largest milk producing country for nearly two decadeswithout any real sustained competition. Engro Foods, in contrast, had only recently been established by Engroa traditional giant in Pakistan's chemical and fertilizer (yes, chemical and fertilizer) industry. Branding experts could not imagine how Olpers could distance itself from its parent companys incredibly unappetizing, chemical-laden, and non-edible roots. Yet, by the end of 2006, sales for Olpers Milk had reached Rs.1 billion (approximately US$ 15million) and in 2008, the brand has a market share of close to 22 percentsecond only to Milk Pak (estimated at 40 percent). The critics had to grudgingly accept that the new entrant to the multi-billion rupee packaged milk category meant business. The packaged milk category was originated in 1981 by (quaintly named) Milk Pak, which pioneered tetra pack milk in Pakistan. The supply chain involved collecting milk from rural areas across Punjab, processing the milk through UHT (Ultra-High Temperature Processing) treatment, and selling it to consumers in uniquely colored triangular and rectangular packs designed to prolong the milks quality. Milk Paks Milk Packs were very well-received and the brand soon became synonymous with quality milk. Its first real competition came in the form of Haleeb, which introduced distinctively blue tetra packs to the market in 1986.Milk Pak, however, further grew in stature when Nestle used it to break into Pakistan's marketplace. By 2006, the dairy milk category was growing at 20 percent annually, and Milk Pak and Haleeb were well-entrenched brands with distinctive colors and brand promises of providing high quality, natural and healthy milk. Milk Pak was identified by its green and white packagingthe colors of the countryand offered a brand backed with the strong equity of Nestle, coupled with its own traditional heritage. Haleeb was recognized as the blue brand, and professed to have the "naturally thickest" milk. With the market dominated by two strong, familiar, and widely respected brands, the marketplace appeared completely impervious to newcomers. Olpers, however, stepped into the foray by launching a massive campaign that started off with an introductory slice-of-life television commercial featuring some of the biggest stars in Pakistan. Billboards went up at key locations in the major cities, and soon the brand had become a voice above the media cluttera voice that differentiated Olper's brand from the others.
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Strategic Marketing Management Final Project INTRODUCTION TO THE MILK INDUSTRY

Pakistan is the Fifth largest producer of milk in the world with a total production of 28 billion liter of milk a year, whose value is more than that of the combined value of wheat and cotton, from a total herd size of 27 million mulch animals (buffaloes and cows). There is a consensus among the stakeholders and the development experts that Pakistans Dairy Sector has immense potential for growth. The same has not been realized due to various gaps. The vital missing link being lack of shared vision and strategy for the development and lack of effective collaboration among the stakeholders including support institutions and the government agencies to implement the agreed strategy. With the every passing day, dairy products are becoming costlier because live stock farming has not scientifically grown with the increase in population and also it did not match with the pace of urbanization. Recently, milk prices in Karachi increased without any reason. In a short time of two years, milk prices have gone up from Rs 20 per liter to Rs 25, showing a 25 percent increase. Moreover, meat prices have also risen to about 25 percent in the last six months. In such a situation, the only way to control prices is to develop the dairy industry on scientific lines, which will not only provide meat and milk in abundant quantities to the domestic consumers but extra quantities can also be exported. In spite of having a large population of LIVESTOCK, the country is spending some $40 million annually on the import of formula milk only, which is the highest amount spent by any country in the world on this particular commotion.
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Strategic Marketing Management Final Project CURRENT SITUATION OF PAKISTAN MILK INDUSTRY
Milk Economy current Overview 33.6 billion liters produced 27 billion liters available for human consumption 7.9 billion liters urban share 19.1 billion liters rural share 6.5 billion liters is household use 1 billion is processed 190 ltr/capita/yr consumed 90 ltr/capita/yr consumed as informal (Loose) milk 7ltr/cap/yr of formal sector (UHT) milk consumed Low Productivity = 1333 liters/animal/yr 15-19% wastage from spoiling National herd constitutes of 70% buffalo 67% of production in Punjab
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Strategic Marketing Management Final Project PAKISTAN MILK INDUSTRY COMPARISON WITH OTHER INDUSTRIES OF WORLD
Milk Production per Animal Kg/Lactation Country Cattle Buffalo Bangladesh Bhutan India Nepal Pakistan Sri Lanka Australia* New Zealand* Source: 1) FAO, 2004 2) *Mr. Collin's Report Feb, 2005 207 257 987 415 1,195 627 4,926 3,947 407 400 1,450 850 1,909 496
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Strategic Marketing Management Final Project PEST ANALYSIS
POLITICAL
It is one of the most important factors in any countrys economy; it plays a vital role in the development of industries. It should be sustainable so that industries grow and foreign investment level becomes high and new industries emerge and unemployment reduce and economy flourishes and the imports level decreases and exports level increases which increases the living standards. If it not so then the situation would be against. Basically Pakistan is an agriculture industry so government of Pakistan encourages this industry. A proper strategy is made to run this sector efficiently in Pakistan then this strategy is presented to the Prime Minister of Pakistan The Prime Minister of Pakistan has approved the strategy and proposed initiatives including establishment of a fully functional industry for the better management of the sector. So now a days milk industry is the fast growing industry In Pakistan. The tax, the tariff and the trade Policy In milk industry: A rational tax and tariff policy can either develop a sector or alternatively assist its destruction. There is a need to change the tax and tariff regime of Pakistan for an efficient and investor friendly dairy sector. Clearly an unfair tax regime that discriminates between the organized and un-organized sector is a huge obstacle to re-investment by major companies. Also in light of the industry restructuring that is taking place and the changes happening due to the multilateral and regional trading system, a complete tariff rationalization of existing policies is needed
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ECONOMIC
The Pakistan dairy industry faces multiple challenges improving the lot of smallholder farmers through enhanced profitability and rural infrastructure, significantly improving quality through the supply chain and to the final consumer, and potentially facing increased competition from international suppliers of dairy products. Hence, there is an imperative need to re-engineer Pakistans dairy industry; both at farm and processor level. This paper seeks to investigate the tools that could bring about such change. We believe achieving the strategic change outlined in this paper for the dairy industry may prove challenging for at least some sectors. Major effort is required to achieve the scale and cost competitiveness necessary to continue to successfully compete in a globalizing and demanding world, while at the same time the interests of the millions of smallholder farmers must be catered for, and a more prosperous future made available to them. It is important conditions are in place to ensure decisions about scale, the number and product portfolio of processing plants are made in a rational manner; this is needed to maintain price competitiveness and market growth. Small niche players will also have substantial growth opportunity in the Pakistani dairy market and their growth will be an added asset. In the absence, at present, of a cold chain; presentation and packaging methodologies will be explored for longer shelf life of products. Lastly, investing in dairy infrastructure and the dairy workforce in rural and urban areas cannot be overemphasized. Without doubt such developments will revolutionize rural Pakistan and improve the quality of life of millions of farmers. An improved dairy infrastructure less dependent on the middlemen will support the farmer to connect directly to processors and the consumer. Contribution to GDP: With an estimated 33 Billion Liters of annual milk production from 50 million animals managed by approximately 8 million farming households, according to latest statistics. Pakistan is the 5th largest milk producing country in the world. It has a livestock and agriculture sector contributing over 10% to the GDP, and a milk economy that in value terms is 27.7% of the total agriculture sector. It is an untapped market, expected to grow an additional 3 billion liters in the next few years at a growth rate faster than most sectors. Undeniably, a sector with such credentials can bring about not just a radical change but also a dairy revolution in the country. The annual milk production of 33.6 billion liters in Pakistan is shared between a 71.1% share for the rural economy and a much smaller urban share of 29%. Only 3% of the total production of milk is processed and marketed through formal channels. For the other 97%, a multi-layered distribution system of middlemen has evolved to supply milk. The contribution of the formal sector processed milk to real GDP in Pakistan is 0.43% in 2004-05. Despite only a small percentage (3%) of milk being processed, the (UHT) market is growing at a steady rate of 20% a year. Presently 97% of raw milk produced in the rural economy is not linked to the market mechanism. The White Revolution is targeted to achieve an annual production of 40 billion liters
Analysis of Pakistans Milk Industry Page 10

of milk by 2015; it aims to create an additional 3 million jobs in the formal economy and provide an estimated 350 million rupees per day in cash flow to farmers in the sector.
SOCIAL
In Pakistan agriculture sector contributes more than 20 percent of the GDP and employs more than 40 percent of the total workforce. Pakistan has larger base of dairy sector allied with the agriculture. Dairy sector generates employment and business opportunities, particularly in the rural and per urban areas. A number of people in urban areas are also involved in dairy based business. The public sector departments hold primary responsibility to guide the farmers and play significant role in dairy sector development. Studies (2006) reveal that the milk production is labor intensive. They pointed out that there are a large number of biological, technical and socio-economic constraints like shortage of feed, high mortality rate, poor genetic potentials, high input cost, scarcity of resources and inadequate marketing system. Demand of the raw and unprocessed milk in Lahore is higher than its supply. This leads to a lot of malpractices in the supply of milk making it equal to its demand. Furthermore, it does not seem commercially viable unless huge planning and dairy development efforts are made by the concerned department of the Government of Punjab. It also identifies several factors like lack of dairy related education and training, lack of marketing and supply chain in dairy industry. Furthermore, the proportion of small milk producers is quite high in Pakistan which hinders the economies of scale and profitability in the dairy industry. It calls for effective decision making in the operations of dairy industry from planning department, key stakeholders, and policy makers. These measures may include extensive training in the area of marketing, management, supply chain, and credit schemes for small farmers.
TECHNOLOGICAL
Pakistan milk industry is lacking in technology. Farmers and milkman still using very old techniques to preserve milk and these techniques are also very unhygienic. So there is intense need for mechanize farms and modernize milk distribution systems There is a need to improve the supply chain from farmer to consumer in Pakistan. There is very limited data available on the routes to market or the distribution channels employed in Pakistan. Most of the milk produced in the farms is consumed at the household level. The surplus is marketed at the local markets in form of liquid milk or purchased by milk collectors and transported to urban areas through different distribution channels. The milk supply and marketing chain involves different players such as milk collectors, traditional cream manufacturers and "Khoya" (milk concentrate for local sweets) makers and retailers. (The traditional cream and khoya is often very unhygienic and is made in dirty work conditions hence is a danger to human health). Milk collectors play an important role in collection and the marketing chain of the dairy sector of Pakistan.
Strategic Marketing Management Final Project PROCESSED MILK INDUSTRY

The processors remain a key driver of the dairy industry with constant reinvestments and diversification of product portfolio. The processors have a small share of 3-4% of the total produced milk, whereas they invest the most and pay the highest taxes. The eight major dairies of the country include Nestl, Nirala, Halla, Noon, Milac, Dairy Bell, Dairy Crest and Premier, while other smaller ones have also emerged. Nestle is the biggest processing industry of the sector, collecting over 1000 tons of milk daily. This company intends to invest an additional US$ 480 million over a period of five years. Similarly Haleeb, Noon Dairy, HALLA (Idara-eKisan), Dairy Crest, Nirala Dairy and Premier Dairies are continuously investing to upgrade their plants Smaller processors manufacturing traditional sweets (Nirala) or organic product lines can create success stories both in domestic and possible export markets. We feel much attention and focus is given to the large plants, while niche players should also be encouraged. A technologyled and innovative product mix approach can create a high margin niche in dairy plants. Due to the lack of a cold chain and refrigeration systems in Pakistan, pasteurized milk has had substantial market failure. On the other hand UHT and powdered milk with longer shelf life have proved to be good alternatives to expensive cold chains. A successful example of pasteurized milk is India, the reason being a well designed and effective cold chain. It is interesting to note that some of the deepest rural areas of India are connected to the consumer through railway based cool tanks. In China, in most urban centers UHT is preferred, but in more outlying areas milk powder may be consumed for convenience. The adoption of UHT technology and new packaging technologies in China has enabled the transport of milk from Northern provinces to the population centers. Companies like Yili and Mengniu (based in Inner Mongolia) were able to rapidly enter markets on the coast and in the south. In Pakistan, UHT and powdered milk is likely to be the only means of providing an alternative to loose milk, especially in NWFP and Baluchistan.
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PORTER ANALYSIS
ENTRY BARRIERS
Anyone who have small piece of land and has power to purchase a buffalo can start this business. No barrier levied by the government. There is no scientific tools and methods is used to produce a milk ,what u need is only a buffalo :P Cost of entering in this business is quite low relative to other businesses.
COMPETITOR RIVALRY
Large numbers of competitors are playing in the industry. There is a huge quality difference between the milk which we get from milk man and the UHT processed milk. And cost is also varied according to the qualities of milk available I the market. Price conscious customer is like to purchase milk from milk man.
SUPPLIER POWER
Large number of suppliers Different suppliers provide different services to their customer e.g milk man provide low quality milk at price and provided milk service at customers doors. Whereas other companies like nestle, olpers, good milk etc provide high quality milk at high prices to the customers.
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THREAT OF SUBSTITUTION
Powdered milk is also available in the market. Many substitute are also available I the market like tea whiteners like Tarang. And their prices are low then Milk.
BUYER POWER
Large number of customers Large numbers of price sensitive customers. Substitute are abundantly available in the market Customer can easily switch to other substitutes if they find it better than their current product which they are using.
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OUTLOOK OF LIQUID DAIRY PRODUCTS INDUSTRY IN PAKISTAN
During the past 11 years, Pakistans urban population has increased by 3 percentage points. By 2009, 35.5% were living in cities (59.9 million people, 5 million more than in 1998), according to Tetra Pak Pakistan. Thus, as people have moved further from the rural areas where most of the dairy farms are found, their access to good quality loose milk has been limited due to the lack of a cold supply chain. This has provided packaged milk companies with the opportunity to provide good quality, safe milk in an alternative form. More educated, sophisticated consumers are emerging. This group values safety, hygiene and convenience; as a result, from 1999 to 2009, packaged products grew by 19%. This has been partly due to dairy industry educational campaigns which have created awareness of the safety and nutritional benefits of packaged milk. Many consumers also appreciate the fact that packaged milk does not need to be boiled before use as loose milk does. In addition, it can be stored for up to three months before opening, so they do not need to source milk daily. Households choose premium products: The growing middle class can afford safer, healthier products that cost at least 20% more than loose milk. The number of Pakistani households in the top three socio-economic groups (as defined by SEC A-C, a tool used to measure consumers prosperity) has grown by 1% annually in recent years, according to Tetra Pak Pakistan. These consumers, who now make up 42% of the population, are increasingly able to afford to premium packaged products such as skimmed and flavored milk. Youthful population is currently, 30% of Pakistans population is under 9 years of age and 53% is under 19. Producers are promoting flavored milk to younger consumers, who most often choose chocolate, strawberry, mango and banana. Adults also like flavored products. One of Pakistans most popular flavored milk brands also offers traditional flavors like saffron, pistachio and cardamom to appeal to adult tastes. Flavored milk still represents just 2.4% of the Liquid Dairy Products market in Pakistan. However, it grew by almost 56.3% from 2006 to 2009 and is forecast to grow 23.1% from 2009 to 2012, according to Tetra Pak. Targeting consumer segments: While nearly 72.8% of Liquid Dairy Products in Pakistan are still sold as plain 3.5% long-life milk, dairy producers are increasingly segmenting the market and developing specialized products. With the exception of white milk and tea creamers, all other products are positioned as premium and command higher prices.
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This data represents the packaged Liquid Dairy Products market with a total volume size of 808 Mio liters in 2009 and is split in the following way
Pakistans five main product segments

Liquid cream Flavoured milk Tea creamer 1% 2% 2% White milk Low fat milk
22%
73%
Outlook is bright for packaged milk as Pakistans population is growing by 1.7% a year, and Liquid Dairy Products consumption is expected to grow 2.8% more from 2009 to 2012. Milk has always played a central role in the Pakistani diet but with demographic changes driving new preferences for packaged milk, the era of nothing but plain, white unpacked milk is rapidly changing. The Major Players in White Milk Industry are: Nestle MilkPak Olpers Milk (Engro Foods Limited) Haleeb Milk Good Milk Nur Pur Prema Milk (Market Leader) (Challenger) (Follower) (Follower) (Follower) (Niche Player)
We will discuss MilkPak, Olpers, Haleeb and Prema in detail.
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Strategic Marketing Management Final Project MARKET SHARE OF TETRA PAK MILK BRANDS IN PAKISTAN
Milk Pak Olpers 45% 22%
Haleeb
17%
Dairy Queen
5%
Good Milk
5%
Nur Pur
4%
Others
2%
Estimations of UHT Milk Production and Consumption up to 2008 09
Annual Production Year (million liters)
Annual Consumption
(million liters)
2008-09
648.43
353.71
2009-10
753.89
372.05
The projected values of UHT Milk consumption and production are obtained from the ARIMA model.
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Strategic Marketing Management Final Project NESTLE MILKPAK
Overview
Company Vision
Vision of Nestle MilkPak is to expand business according to the increasing demand of market. As per our company vision in 2020 production capacity of all plants working in Pakistan is being increased. So extension of Kabirwala Plant is the example of our company vision.
Company Mission
At Nestle, we believe that research can help us to make better food, so that people live a better life. Good food is the primary source of good health, so we are trying to make good food. To provide fresh and pure products to the customers, we introduced (SHE) Safety, Health and Environment policy to protect health of our employees and keep clean our surrounding environment.
Nestle MilkPak
Dhood ki Qudrati Ghizayat Pure, nutritious goodness of Milk Pure, rich and delicious Nestle MilkPak standardized (UHT) benefits from Nestles expertise in bringing you the best life has to offer and benefits from 140 years of consumers trust.
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Encourage your family to exercise regularly, eat a healthy, well balanced diet and drink pure, nutritious Milk for good health. Milk is a must drink for your children as it is a rich source of calcium that helps in the growth and development of strong bones and teeth.
A 250ml Nestle MilkPak Glass consist of followings: 27-30% of calcium, 15-18% of protein, 31-34% of phosphorous,6-9% of Vitamin A and 160-169 k Cal of energy, as recommended dietary allowance by national Academy of Science (USA).
The contents of the above said products have the following fruitful benefits for health improvement of Human body. Calcium It is important for the growth of strong bones and teeth. Protein It is necessary for cell and tissue growth. Phosphorous It is important for healthy bones and teeth. Vitamin A It improves vision and keeps skin and hair healthy
Competitors
The main competitors of Nestle MilkPak are: Haleeb Milk Olpers milk Good Milk Dairy Queen Milk
Competitive Advantage
Nestle MilkPak never compromises on quality. Nestle MilkPaks extensive milk collection system ensures that the milk you get is of the finest quality. Nestles products are available in every city and town Nestle is using the latest technology in its production units. Nestle makes milk powder of the surplus milk in winter and converts this milk powder into UHT milk in summer.
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Market Segmentation of Nestle MilkPak
Geographic Segmentation: MilkPak has segmented the market on the basis of Geographic segmentation and its target market is major populated cities of Pakistan Demographic Segmentation: Nestle MilkPak is also segmenting the market on the basis of Income level of the people. Three Income level has been defined; higher, middle and lower income classes.
Targeting
Urban areas of the country Upper and Middle income class
Positioning Strategy
Functional Positioning Nestle MilkPak has adopted the functional positioning strategy like: o Khaalis He Sab Kuch Hai o Wohi Qudarti Maza o Jaan Banaoo o Banaye Mazboot Gharana Differentiation o Addition of IRON and Vitamin A & C
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Situation Analysis
Awareness: Top of the mind recall Due to strong brand positioning and effective advertising, MilkPak has highest awareness level.
Market Trends
The growth of processed milk is increasing by 20% annually People are getting more quality and health conscious with the passage of time Due to impurities of Gawala milk, people are attracting towards processed milk
Key factors are: Changing lifestyle Influence of foreign media
Market Potential
At an average, a Pakistani consumer spends 42 % of income on food Consumer often prefer branded food items for both quality and status reasons Per capita real GDP has increased at an average of 5.6 % per annum during the last three years This increase has led to a rise in average income of people and an increase in consumer spending.
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SWOT Analysis (Nestle MilkPak)
Strengths: Strong Brand image: o Nestle has been serving the Pakistani consumers since 1988, and it has built a strong brand image due to its quality products. Quality product: o Nestle MilkPak is known as the best UHT milk in Pakistan due to consistency in quality. Solid Financial position: o Nestle MilkPak annual turnover is Rs.30 Billion which provides it a financial edge over its competitors. Strong supply chain network: o Nestle collects Milk directly from the farmers instead of relying on the contractors. And it distribution is also very strong. In this way it has a complete control over its supply chain. Qualified work force Commitment to High Quality Products Focus on research and development
Weaknesses: The target market of Nestle MilkPak is upper middle and high class because lower middle and poor class cannot afford to buy UHT milk due to its premium price. This is the only weakness of MilkPak.
Opportunities: More people are coming towards processed milk because loose milk is dangerous for health due to a lot of contamination. Growth of processed milk is increasing with 20% annually so Nestle MilkPak has the opportunity to capture a large share of market.
Threats: Two main competitors Haleeb and Olpers are main threat for MilkPak especially the Olpers is growing very fast. Inflation is getting higher and higher so the purchasing power of the people is decreasing day by day. There is no entry barrier for new entrants as the Olpers has come in the market.
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Marketing Mix
Product: Quality Product o Nestle MilkPak has the largest market share due to its consistent quality. Product Style and logo o Nestle MilkPak is available in different product range and stylish packaging. Product Lifecycle o Nestle MilkPak has been in the market for a very long time and it is at maturity stage.
Price: Competition Based Pricing o MilkPak is holding a large share in the market due to its quality at same price as compared to competitors.
Placement: Distribution Channels: MilkPak is not sold directly to consumers and the complete distribution process is followed. It uses indirect channels for distribution like: o ManufacturerDistributorWholesalerRetailerConsumer
Promotion: Focusing on health conscious people in their advertisement.
Promotion Mix Advertisement Public relations
Marketing Strategy
Nestle is pursing growth strategy. They have invested $ 70 billion at Kabirwala Plant and they are planning to invest $ 381 billion in the milk business. Being the market leader MilkPak uses mobile defense strategies; it recently proved this by launching MilkPak powder in order to diversify. However they have powdered milk products targeting Children NIDO and Tea Lovers EVERYDAY but still they diversified to gain edge. However MilkPak is using Counter Offensive Strategies as well to counter the attacks launched by Olpers
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Strategic Marketing Management Final Project OLPERS MILK
Overview
Vision
"Our vision is to become a fast expanding mega foods company. To achieve our vision, the company will initially focus on dairy by investing a substantial amount in plant, milk collection capability and marketing. We are making concrete efforts to expand in and beyond Pakistan; through strategic international alliances, to eventually become global."
Core Values
1. Leadership 2. Innovation 3. Diversity and International focus 4. Quality and continuous Improvement 5. Candid and open communications 6. Individual growth and development 7. Enthusiastic pursuit of profit 8. Ethics and integrity 9. Safety, Health and Environment

SEGMENTING TARGETING AND POSITIONING Segmenting and Targeting the Market for Olpers:
It is difficult for any one company to engage in mass production, mass distribution and mass promotion for its product. The complexities arise from the proliferation of advertising and distribution channels and the high costs associated with reaching a mass audience. Therefore, companies segment the market so that they can target the group of customers who share similar needs and wants. The milk sector shows a market that has homogeneous preferences that is the consumers have similar preferences. They want milk to be white, carefully processed, and good for health and bones. Keeping these things in mind Olpers market has been segmented. The marketers at Olpers have had a number of options available to them when segmenting the market for their products. So far company has introduced three new products: Olpers milk, Olwell diet milk and Olpers cream. Demographic segmentation Olpers products are not bounded to any particular age, gender or lifecycle stage. The brand is meant for all the users in higher upper or middle class families. Even though the brand calls for a small percentage of an individuals income but lower class wouldnt want to buy the brand maybe because they are price sensitive or because they believe lose milk is better than processed milk and has all the nutrients that the processed milk lacks. However all the companies in the milk sector are trying to change the image of processed milk as non-nutritionist milk? Therefore it can be said that Olpers has been positioned as a brand for high income earners. Due to the income factor involved it can be said that Olpers milk target a specific social class who are health conscious and concerned about their weight. Psychographic segmentation On the basis of psychographics, factors such as personality traits, lifestyles and values, the marketers at Olpers have segmented the market more towards achievers who are goal-oriented and focused on their careers, and experiencers those who are seeking variety in the milk sector. For example the ads for Olwell mostly show achievers who want to be successful, have high aims and are already doing quite well in their concerned fields. The Olpers products have targeted experiencers because the company has given them a new set of brand and so many will make their first purchase because they want to try something new. Olpers ads also target believers, traditional conservative people with concrete beliefs. The ads for Olpers show the beliefs of healthy life with processed milk and plays on the emotional aspect more.
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Behavioral segmentation Olpers products have been segmented on the basis of benefits that consumers seek in the milk. In this case, people look for a brand that can be used for all purposes from drinking to tea whiteners as well to feed the animals. The ads also show that consumers should increase their milk consumption for example with every tea they should use Olpers, every morning they should drink Olpers and everyday they should feed their pets with Olpers milk. There may be some hard core loyal in the milk sector. Loyalty maybe towards such established brands as Nestle and Haleeb. There might even be switchers and shifting oyal in the milk sectors that are either price sensitive or want variety. As a result, the marketers need to find ways to make the hard core loyal attracted to the Olpers brand and shifting loyal and switchers to convert into hard core loyal as well.
Positioning the Brand

Positioning involves designing the product and image that will occupy a distinctive place in the minds of the target market. As can be seen, Nestle MilkPak and Haleeb have the largest profit margins and market share in the milk industry. Thus the marketers at Olpers have decided to create its own unique image and then strengthen the position in the customers minds. They have done this by taking a number of following steps: 1. Packaging of Olpers milk and Olwell in red color and Olpers cream packed in purple color are quite different and distinctive from the typical green and blue packing used by other competitors. 2. The brand has been positioned as an all purpose milk that is meant for everyone, especially for those who live life to the fullest, hence its tag line, jo dil khol kay jeetay hain unheen kay liyay hai Olpers Olpers always tries to create customer intimacy that is it focuses on satisfying the customers unmet needs. Processed milk is seen as less lacking all the nutrition that is part of milk due to passing through so many processes. But Olpers positions itself as milk that has not lost its nutrients. The unique selling proposition for Olpers is: Subah Bakhair Zindagi, but recently the company changed the USP to: Jo dil khol kay jeetay hain unheen kay liyay hai Olpers.
Both the tag lines have a very positive impact on Olpers image because of the emotions involved in both the lines.
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SWOT Analysis
Strengths 1. Engros Back Olpers is a brand of ENGRO foods. This means that consumers can relate their former image of ENGRO foods to Olpers. ENGRO is a well established brand name in Fertilizer, IT and infrastructure business. The brand is well known so customers will automatically have a brand association with Olpers and see it as a premium quality product. ENGRO is world renowned so it can easily attract foreign investors in backing it against other competitors such as Nestle. ENGRO foods can easily afford research and development costs for Olpers have in order to introduce new products. It can also distribute the brand through better channels because of its long term relationship with distributors in the agriculture sector. 2. PR with farmers ENGRO has been interacting with the farmers for fertilizers and has gained quite a good reputation over the years. It has led to a strong bond and long term relationship with the farmers who are willing to supply milk to the company. This is an added advantage and strength for the company because it will never be short of milk production. The farmers also wont have to look elsewhere to sell their milk. 3. Positive response from customers In first year, EFL crossed 1.4 billion sales figure which shows customers satisfaction upon EFLs products. 4. Its taste, quality proposition and world-class quality proposition system. 5. Strong consumer & product research Olpers done a strong consumer & product research before and after launching the product. This has provided them the perfect launching pad to eventually emerge as a global player in the food industry. To develop its future portfolios, EFL has hired various global research partners like AC Nielsen, Mindshare, JWT Asiatic and MARS marketing and advertising agencies. 6. Third-Generation Plant EFL only, has the third-generation UHT milk plant in the country. EFL plant is the only plant in Pakistan that uses Bactofuge technology to virtually eliminate bacteria and ensure premium quality and hygiene. Moreover, it is also setting up another milk processing plant in Central Punjab (Sahiwal) with an investment of Rs. 2 billion (US $ 33million).
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Weaknesses 1. Olwell TVC Olwell ad which is based on Western life style, ENGRO foods brand management showed a man who put off his clothes & remain just in his undergarments, or half nude lady in a cat walk or men admiring the figures of a lady in mix gender health club. In this ad they are creating associations with the brand through the stripes, which is a highlight of Olwell packaging. Half naked people have been shown with tattoos of the same stripes in order to show that they are loyal consumers of Olwell. Also, the talent, situations and locations connects well with the ad to give Olwell a premium positioning. The brilliant marketing people at ENGRO Foods failed to analyze is that the market they are targeted the ad on, is Pakistan, where practicing Muslims reside, who have strong religious beliefs. When making the ad, the brand managers were focused on, making an ad that should give the brand the most premium look and feel amongst the target consumers but on the other hand they were least bothered about the ethics, religious beliefs and cultural values. 2. Low Quality Milk EFL is not having its own dairy farms; it largely collects loose milk from farmers & gawalas through its 40 milk collection centers, which sometimes is of low quality and impure because they add vegetable oil to milk to get higher prices. 3. Packaging EFL is dependent upon Tetra Pak for the packaging of its entire dairy products. Tetra Pak is the only option available to Olpers for packaging because it is having monopoly in the packaging sector in Pakistan. Due to this reason, Tetra Pak can charge them higher and it could increase the production costs. 4. Milk collection & distribution costs EFLs 34 out of 40 milk-collection centers are located in Punjab, whereas its only milk processing facility is situated near Sukkhur (Sindh). It increases the milk collection & distribution costs; and also increases the chances of milk getting spoiled because of increased travelling time. 5. Narrow brand portfolio It has been more than a year now, when EFL launched its first dairy product, Olpers Milk on March20, 2006. But EFLs brand portfolio still consists of just 3 products i.e. Olpers Milk, Olwell Milk and Olpers Cream. Whereas its competitors like Nestle and Haleeb Foods have a much diversified line of dairy products.
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Opportunities 1. Increased funding by Government Government has decided to increase farmers funding. This is an opportunity for ENGRO foods because previously due to weather conditions and other reasons there was lots of wastage of milk but now that can be reduced as farmers will be better able to store milk for longer time periods. 2. Increased consumption of PLM Competition may create opportunities for the company because each competitor in the milk industry wants to increase penetration of processed liquid milk and so they will create awareness for consumers through different advertising media. This will ensure the increase in the consumption of processed milk instead of lose milk and so will in turn lead to increase in sales for the company. Therefore there will be an opportunity for accelerated growth. 3. Awareness Growing dissatisfaction with loose milk and increasing awareness about health and hygiene issues have led to increased processed milk consumption. 4. Fifth largest producer of milk Pakistan is the fifth largest producer of milk in the world with a total production of 32billion liter of milk a year, whose value is more than that of the combined value of wheat and cotton. Milk is the largest commodity from the livestock sector accounting for 51 percent of the total value of the sector. 5. Improving Economy Threats 1. Competition Competition may pose a threat because the company will have to maintain its leadership in an expanding market so that it doesnt lose its market share to its competitors. For Olpers it might be difficult to penetrate in a market where the loyalties exist for such brands as Nestle and Haleeb. These brands have been in the milk industry far too long and have left a mark in the minds of consumers in terms of quality. Competition seems to be getting tougher as a result of new players entering the dairy market. 2. Perceptions and Price Differentials Consumers perceptions and price differentials can cause a threat for the company. It is important that Olpers comes up to the expectations of the customers and fulfills its conformance quality that is the company meets its promised specifications.

Marketing Mix
Product Olpers Milk
Launched on March 20, 2006, Olpers milk is EFLs standardized and homogenized pure UHT (Ultra heat treated) milk with 3.5 % fat and 8.9 % solid non-fats. It is EFLs premier brand, and the choice of quality-conscious consumers who only go for the best. It is available in easy-toopen, 6-layered Tetra Pak Brick Aseptic red packaging and comes with a 3 months shelf life. Shipping Units 1.5 Liter (1500 ml) 8 Packs / carton 1 Liter (1000 ml) 12 packs per carton Liter (500 ml) 12 packs per shrink-wrapped tray Liter (250 ml) 27 packs per shrink-wrapped tray
Olwell Hi-Cal Lo-Fat (HCFL) Milk (Discontinued) Launched on December 15, 2006, Olwell is a low-fat, high-calcium milk with the richness of pure milk. It is an ideal choice for weight-watchers and heart patients. It is also high in calcium content, which prevents osteoporosis. Packed in 6-layered Tetra Pak Brick Aseptic red packaging with easy-to-open plastic cap, it comNo table of contents entries found.es with a 3 months shelf life. Shipping Units 1 Liter (1000 ml) 12 packs per carton Liter (500 ml) 12 packs per shrink-wrapped tray
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Olpers Lite
Recently launched, it is a low-fat, high-calcium milk with the richness of pure milk. It is an ideal choice for weight-watchers and heart patients. It is also high in calcium content, which prevents osteoporosis. Packed in 6-layered Tetra Pak Brick Aseptic blue packaging with, it comes with a 3 months shelf life. Shipping Units 1 Liter (1000 ml) 12 packs per carton Liter (500 ml) 12 packs per shrink-wrapped tray OLPER'S Owsum Milk with Flavors (200ml):
Olper's brings you Owsum - a delicious nutrient loaded flavored milk. Owsum combines the goodness of milk with yummy bursts of flavors to keep you healthy and fit. So drink up and get your daily dose of ESP (Energy, Strength & Power) so you can rule your Owsum world. Owsum come with this flavors: - Chocolate with Milk. - Mango with Milk.

- Banana with Milk. - Strawberry with Milk Placement & Distribution According to Mr. Ali Akbar, Director Marketing EFL, In order to succeed, you should ALWAYS capitalize on your STRENGHTS and NEVER on your COMPETITORS WEAKNESS! Engro Foods did exactly that. They used their decades of PR with farmers and used it to provide world-class supply-chain management for delivering the ultimate quality milk in Pakistan. Having kicked off simultaneously in 20 cities across Pakistan, the launch has been ambitious and currently Olpers is available in 80 cities across Pakistan. It reflects the companys intention to become a big player in the industry, both on a national and international level. Engro Foods Limited has its own dales and distribution network. EFL has divided Pakistan into five regions for milk distribution namely: Karachi, Lahore, Islamabad, Peshawar and Multan. Due to an appealing color scheme, which stands out in the clutter and thanks to the EFLs strong relationship building and special discounts to retail outlets, Olpers has gained a proper shelf placement in the presence of competitors like Nestle and Haleeb . Price EFL is pursuing the competitive pricing strategy for its products. In competitive pricing the price of the product is determined considering the price of major competitors like Nestle, Haleeb etc. Promotion & Advertising Olpers launch was, perhaps one of the most aggressive as far as processed liquid milk (PLM) is concerned, with TVCs, print ads, radio commercials, billboards and plenty of BTL (below the line) activities including direct consumer and shop branding activities. Due to this aggressive marketing campaign, the competition seems to be getting tougher. This can be gauged from the fact that Nestle re-launched its product packaging and marketing campaign just before Olpers launch. One can also a far greater number of milk advertising billboards in Multan city than seen earlier like of Nirala, good milk and Nestle. Olpers Milk Media mix for Olpers milk includes TV, print, outdoor, radio & BTL activities. Olpers considers radio still an effective medium because A & B house wives still listen to the radio on a daily basis
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Olpers as a Brand ENGRO, although a separate name from Olpers has a very strong impact on the sales of Olpers. People know ENGRO because of its well established reputation in fertilization sector. Therefore, they hold a strong association in their minds for Olpers as well. There are different nodes that connect ENGRO to Olpers in the customers minds. The ads for Olpers do not show any link with ENGRO foods but the HR managers keep mentioning ENGRO in every press release of Olpers. That is how people have associated Olpers with ENGRO. The sales figure for the first eight months of Olpers launch showed a number in billions. This is evidence that people have accepted the brand and liked it. Thus marketers have been successful in creating customer-based brand equity for Olpers. This could be due to strong associations with ENGRO in the minds of customers. Due to just a few brands in the milk sector it is easier for customers to make different associations for each brand in their minds. Therefore, a persons ability to recognize and recall a brand under a given set of product categories becomes easier. Olpers has been aggressively promoted which is why customers can recognize it easily. The red color and the shelf space that the brand commands make it even more prominent from the rest of the brands. Although Olpers product related attributes, such as white color, hygienic and processed milk, are quite similar to other brands such as Nestle and Haleeb, while the non-product related attributes such as the packaging of red color and usage imagery that is portrayed in every advertisement of Olpers, can be distinguished from the competitors brands. Olpers is promoted with the viewpoint that the milk is meant for all-purposes. This obviously shows the usage imagery of the brand. People can now choose from a number of brands for milk and especially the variety seekers will definitely want another brand to enter the market. If, in the beginning, consumers are not willing to buy the brand then it might be due to such factors as low involvement in that product category or due to brand loyalty towards brands like Nestle and Haleeb. However, the color of packaging in the grocery stores may attract customers enough to make them buy it, thus the brand attitude In this case helped the brand to form the basis for customer behavior. Olpers has favorable, strong and unique brand associations in customers minds. It is favorable because milk is a need and clean hygienic milk that is free of bacteria and germs is what conscious customers are looking for. Due to awareness about health and drawbacks of lose milk the customers are further in search of processed milk. The association is also strong because there is a very string cue linked to Olpers and that is ENGRO foods. Usually people thin Olpers as a sub brand of ENGRO foods. Due to this reason customers perceive Olpers as a high quality brand that will come up to their expectations. Olpers has created a unique image through its ads.
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Olpers itself is a very distinctive name that is easy to remember and one that will stay in the memory for a long period of time. It even serves to enhance the image of the brand as allpurpose milk. Therefore, the choice of brand identity when building the brand equity has been very good. These create brand recognition and recall all at the same time. Olpers has been developing marketing programs to enhance brand awareness initially. Due to familiarity with ENGRO foods, Olpers did not have much difficulty in building the customer-based brand equity. Thus ENGRO can also be seen as a secondary association for Olpers and one that has strongly influences the positioning of Olpers. It has added to the credibility of Olpers. To Measure customer-based brand equity of Olpers HR managers used questionnaires to find how customers feel about the brand. They used the indirect approach with different qualitative and projective techniques (the questionnaire contained some questions related to sentence completion and brand personality description). They used this to understand customers feelings for the brand. The managers agree that ENGRO Foods has helped improve the image for Olpers. They assessed the leverage of secondary associations in this case by comparing the companys characteristic with the characteristics of Olpers. Managing customer-based brand equity the organization is managing the customer based brand equity because they realize the significance of marketing activities and their effect on creating more value for the brand, and so by influencing brand knowledge, sales can be improved. Olpers is concentrating on the emotional aspect in their ads in order to focus on the core need of customers that can be satisfied. Olpers has also funded Womens exhibition in Karachi a few months ago and currently is sponsoring cricket World Cup 2007, and further adding more value to the brand and managing customer-based brand equity.
Future plans
Engro Foods Limited (EFL) announced its vision to emerge as a global player in the food industry with a proposed initial spending of over $200 million. The vision announced at a press conference in Karachi aims at transforming the company within the next five years into first national food industry giant, then into a regional force and finally into a global player. For the year 2007, the Board of the Company has already approved Rs 2.0 billion investments in capacity expansion and marketing, including setting up of a plant in Central Punjab. While unfurling its future plans, ENGRO Foods CEO Sarfraz Rehman stated, "Our vision is to become a fast expanding mega foods company. To achieve our vision, the company will initially focus on dairy by investing a substantial amount in plant, milk collection capability and marketing. We firmly believe that there is a big dairy opportunity available and with our strong entry in UHT milk category, with Olpers milk, we have placed ourselves ahead of others in terms of quality and consumer-understanding. It is our belief that we can get the maximum out of this opportunity by focusing on innovation and quality."
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Strategic Marketing Management Final Project Haleeb Milk
Overview HFL is one of the fastest growing packaged food companies in Pakistan with an annual turnover of Rs. 9.2 Billion (F2006). It is a private limited company. It started commercial production in July 1987. Due to consistently superior performance, it has achieved undisputed leadership in the liquid packaged milk category with a market share of over 52%. HFL has a very strong brand portfolio consisting of dairy as well as non-dairy products. Haleeb Foods has segmented its product portfolio in 3 leading brands including Haleeb, Candia and Tropico. Haleeb is the flagship brand of the company. Haleeb UHT Milk is available in 5 SKUs of Tetra Pak packaging. Due to its strong positioning of the thickest milk for best tea, it has the highest top of mind awareness and penetration in the dairy industry of Pakistan. In order to increase consumer and trade penetration of the brand, it is also available in Tetra Fino Packaging under the brand extension of Haleeb Dairy Queen. Haleeb has also progressively diversified from UHT Milk to other product categories as well. These product line extensions include Haleeb Butter, Haleeb Yogurt, Haleeb Cream, Haleeb Labban (Drinking Yogurt), Haleeb Asli Desi ghee (Butter Oil), Haleeb Funday Juice Drink, Haleeb Skimz (skimmed milk), Haleeb N'Rish Full Cream Milk Powder & Haleeb Good day Pure Juices. Haleeb Good day is the only range of 100% pure juices in the country with a variety of 6 pure juice flavors. HFL has one of the largest nation-wide distribution networks delivering high quality products, even in the remote areas of Pakistan. With a network of +1100 distributors the company ensures that the product range is available in all the urban and semi urban areas of Pakistan. Furthermore, concerted efforts are being made to develop the rural market as well.
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HFL has an efficient and resourceful Export department, which has successfully tapped opportunities in foreign markets including Korea, Hong Kong, USA, UK, China, Afghanistan, Bangladesh and the Middle East. In order to provide best quality products to its consumers, HFL has a well-developed supply chain infrastructure. It has heavily invested in a vast network of company operated milk collection centers across the country. HFL has a strict and stringent quality policy regarding intake of raw milk. It is the only company that conducts 21 rigorous quality tests to ensure that only fresh milk of the highest quality is accepted at the plant premises. These internationally recognized tests are used to check for: a) adulteration, b) microbiological contamination and c) adequacy of nutritional contents. Further, Haleeb Foods is the only food company in Pakistan that has the following international certifications of quality and prestige: HACCP (in process controls for safer products) ISO 9001 2000 (better quality for greater customer satisfaction) ISO 14001 (environment-friendly operations)
HFL believes in using cutting edge processing and packaging technologies to meet consumer expectations of hygienic and high quality food products. It has more than 30 Tetra machines for its UHT milk brands and 5 UHT units with a capacity of producing more than 1 Million Liters of Milk every day. Keeping in view the volume potential and increasing growth trend of the market, the company has recently inaugurated a second independent UHT plant at Rahim Yar Khan. Haleeb Foods has a highly professional management team with a progressive operating style. The management team comprises of highly seasoned professionals with diverse global experience of managing and developing brands. It can lay claim to be one of the very few Pakistani organizations, which are truly following the model adopted by globally successfully corporations, with clearly defined roles for shareholders and the management team. The company takes pride in being a model national organization delivering international quality products and higher value for money to its consumers. The management team at HFL strongly believes that Pakistan offers enormous potential for food business due to a large consumer base, high acceptance of packaged food, and a growing urban middle class consumer segment.
Vision Statement:
Most Innovative and fastest growing food company offering products enjoyed in "every home every day"
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Mission Statement:
Build Branded food business to improve quality of life by offering tasty, affordable and highly nutritional products to our consumers while maximizing stake holders' value.
Values:
Enterprise Empowerment Accountability Trust Teamwork
Products
Haleeb Milk in Tetra Pack
Consumers everywhere know that only Haleeb Milk makes the best tea ever because of its thickness. Haleeb is pasteurized, homogenized, and standardized pure UHT milk of the highest standard with 3.5% fats and 8.9% solid non-fats. It is Haleeb Foods premier brand, and the choice of quality-conscious consumers who only go for the best. Packed in easy to open, 6layered Tetra Pak Brick Aseptic packaging, it comes with a 3 months shelf life. Shipping Units 1500 ml: 8 Packs / carton 1000 ml: 12 packs/carton 500 ml: 12 packs/shrink-wrapped tray
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250 ml: 27 packs/shrink-wrapped tray
Haleeb Bottle
The good thing about the Haleeb Bottle is that it is made out of material that is 100 percent recyclable. Feel free to have your own pick according to your need. , Haleeb Milk is all about making your life simpler and easier. The Milk Bottle's convenient screw cap makes it easy to use in our day-to-day life. The aluminum that covers the mouth of the bottle ensures that the milk that reaches you remain fresh. Approved by CCTPA the Haleeb Milk Bottle has multi protected layers that keep it safe from bacteria and sunlight. Shipping Units 1000 ml / 8 pieces per cartoon 250 ml / 24 pieces per cartoon
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Dairy Queen
Dairy Queen is Haleeb another standardized and homogenized pure UHT Milk with 3.5% fat and 8.9% solid non fats. At an affordable price it has won the hearts of consumers everywhere. It is available in 6-layered Tetra Pak Fino Packaging, introduced for the first time in Pakistan and has 2 months shelf life.
Shipping Units
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Haleeb Gold
The Thickest Milk with Extra Cream. This marvelous product provides all the benefits of the Thickest Milk along with the natural goodness of extra cream. Haleeb Gold with its extra rich creamy taste makes a perfect cup of Tea. It enhances your performance and helps to maintain a healthy, dynamic lifestyle.
Shipping Units 1000 ml: 12 packs/carton 500 ml: 12 packs/tray 250 ml: 27 packs/tray
Haleeb Tea max
In tune with the Haleeb Foods tradition of providing consumers high quality and value added products, Haleeb Tea Max is the ideal choice for all tea and coffee lovers. Tea Max is special milk that provides a rich taste in your beverage. It is also available in the unique
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and delicious cardamom flavor, packed in a 6-layered Tetra Pack Brick Aseptic packaging. Shipping Units 200 ml (plain) pack: 27 packs/carton 200 ml (cardamom) pack: 27 packs/carton
Haleeb Skimz Powder
Skimz is a fat-free milk powder, naturally low in cholesterol; yet high in proteins and calcium. There are mainly two types of milk powders, full cream and skimmed. SKIMZ is a skimmed milk powder. Full cream powder contains 28% fat, whereas SKIMZ contains less than 1% fat. Moreover, the protein and calcium content is higher in SKIMZ as compared to full cream milk powder. It is best suited for weight conscious people as well as those trying to maintain a low cholesterol level.
Shipping Units 200 g: 12 skillets/shrink-wrapped tray 500 g: 12 skillets/carton
HFL also produces bulk dairy products. Instant Full Cream milk powder (IFCMP) Full Cream Milk Powder Skimmed Milk Powder Instant Skimmed Milk Powder (ISMP)
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SWOT ANALYSIS
STRENGTHS: No 1 dairy company Growing Sales and profits Major shareholder in the food industry of Pakistan Efficient Distribution networks throughout the country Quality Products Environment Friendly Socially Responsible Company Haleeb Food's products enjoy strong brand image and market pull Innovative and constantly growing product line Sales force is the major resource strength in terms of physical resources of the company Marketing strategies established by the company are innovative and lure customers Financial, marketing and sales strategies are formulated by gauging the customer demands Periodic research carried out to judge market trends Highly sophisticated plant and equipment Qualified work force Focus on research and development First and the only dairy company in Pakistan to get ISO 9002 certification
WEAKNESSES: Relatively a small and local company in comparison to its rivals. Dependence on 3rd party for supply of milk. No credit sales. Low sales margins due to highly value added products. They cannot launch many of its expensive international brands due to the lower income groups. Selective investment due to uncertain economic and political conditions. Feasibility of new products needs to be analyzed, e.g. Candia Drinking Yogurt was launched some years back but it failed because no customer demand exist it. The packing line installed for N'Rish has a higher capacity than the actual demand of the product, resulting in higher overhead costs for the product. Inadequate marketing. Low promotional activities.
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Comparatively weak distribution system.
OPPORTUNITIES: Pakistan is the seventh largest producer of milk in the world with annual output of over 22 billion liters. There are substantial growth opportunities considering the average yield of Pakistani animals at only 1,100 liters/annum as compared to 6,000 liters/annum for animals in Europe and USA. There are nearly 20 million milk producing animals in the country, mostly in Punjab (80%). The overall milk market in Pakistan is 20 billion liters, out of which processed milk contributes only 3 million liters. Haleeb Foods along with other processed milk business contribute only 2% to this large market. Haleeb Foods' has expanded its product range by launching milk in Tetra Fino Packaging. Credit policy can be adopted to increase sales. HFL can export to others countries. CDL has been changed to HFL, so this change in name can help them to attract foreign customers. HFL can go for related diversifications by producing pure juices and flavored yogurt. HFL can go for joint venture with other companies to attract the market share. Entering in to the market of baby cereals, which will help them in increasing their revenue. Launching cheese would also beneficial for them to create the brand awareness.
THREATS: Competition with Nestle, Engro Foods. Effect of Seasonal ties upon sales. Dependency on contractors for supply of milk. Price fluctuations due to rupee devaluation as raw material are imported. The uncertainty of economic conditions poses a great threat. The present economic crisis in the world, led to the withdrawal of foreign management from the company and the investment has come to a halt. Price sensitive people. Milk man (Gawalas) providing non branded milk in homes.
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Strategic Marketing Management Final Project PREMA MILK
Overview
Prema Milk is obtained from pure breed cattle on one of the most modern farms in Pakistan, in a hygienic and healthy environment under the constant surveillance and monitoring of our farm managers, health and hygiene experts and the most stringent quality control systems. Prema is fresh and pure pasteurized milk, free from any preservative or additive hence it requires to be kept refrigerated, below 4oC. Prema is pasteurized milk and does not require boiling before using. Unlike UHT milk, opening of cap does not shorten the expiry of Prema Milk.
Current Scenario of UHT and Pasteurized Milk Market

Packaged Milk is around 5% of the total consumption of milk in the country 70% of UHT Milk is purchased for the purpose of tea making UHT Milk market is around 3 Million LPD Tea Whitener is around 40% of the total UHT market 70% of UHT Milk Sale is in 250ml pack and 30% in 1 Liter pack Pasteurized Milk market limited to major towns only and is 80,000 LPD (ForLhr, Rwp, Isd & Fsd)Share Composition of Pasteurized Milk Market
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SWOT Analysis
Strengths Better consumer perception of pasteurized milk with regards to quality and taste resulting in high brand equity Total control on quality due to own cattle farms Pasteurized milk is pouch packaging is more vulnerable to damages and leakages hence making the brick packaging a safer and handy packaging solution Strong financial and business background of the group Higher price premium in brick packaging
Weaknesses Short shelf life of Pasteurized milk as compared to UHT Milk making it a sensitive product Smaller market size of Pasteurized milk as compared to UHT Milk due to shorter shelf life, storage conditions and logistics issues. Limited geographical market (major towns) due to cold chain distribution and upper middle and upper class target market Limited market coverage and distribution network as compared to the competition
Opportunities Quality issues in UHT due to adulteration at the back end gives an opportunity to better quality brick packaged milk to make its standing in the market. Packing of Pasteurized milk in Tetra packaging to obtain a longer shelf life can be explored to overcome the distribution and trade related challenges. Market size of packaged pasteurized milk with brick pack can be increased by converting the high-end UHT milk consumer to better quality brick Pack. Pioneer in brick packaged pasteurized milk at the moment. Easier to establish a respectable market position The company can venture into bigger UHT Milk and Powdered milk market in the longer run after having achieved the required expertise
Threats Packaged milk market under pressure due to recession and reduced purchase power. (as a substitute of fresh milk) Proposed govt. taxes on packaged milk will further widen the difference in the prices of packaged and fresh milk affecting the price sensitive segment. Major players dealing in UHT Milk may come up with a similar product and can prove to be a tough competition
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Target Market
Keeping in view the fact that 70% of UHT milk is used for tea making, companies have developed exclusive product for this purpose i.e. Tea Whitener, with reduced cost. Tea Whitener has taken around 40% share of the total UHT Market and is still expanding Some of the market of Liquid Milk has been taken by Packed Milk Powder, primarily, for tea making Pasteurized Milk used to sell primarily in pouch pack however; recently, with the advent of international standard cattle farming in Pakistan, premium brick packaging has been introduced in the market, which has been well received in the market Target Market Socio-Class: Since, brick packaging is an expensive packaging; the product is more expensive as compared to competitors available in pouch packaging. This rather makes brick packed pasteurized milk a product for upper middle and upper social classes as opposed to the lower middle and middle classes in case of pouch packaging. The above fact implies that the brick packed pasteurized milk has got the same target market as that of Tetra pack UHT Milk (1 Liter) Geographical Market: Since, major consumption of Tetra pack (1 Liter) and other expensive packaged milk products is in major towns, the geographical target market of Prema is limited to the major towns, more so, due to the inherent limitation with the cold chain distribution of short shelf life product, which has to be in a certain perimeter from the processing plant. Geographically, Lahore, Faisalabad, Rawalpindi, Islamabad, Gujranwala, Sialkot, Gujrat, Jehlum and Multan are the main areas of focus for distribution of Prema Age Profile of Target Customers: Prema is primarily being positioned as high quality, good taste, drinking milk which is equally common in use across all ages. So the target market ages from 4 years to 60 years
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Pasteurized Milk Market
Dairy Volume Nurpur Gourmet Adam's Prema Others Total (LPD) 20,000 30,000 12,000 12,000 6,000 80,000
Distribution Strategy
Distribution Network o Presently, conventional distribution is being followed by appointing distributors and targeting the selective, premium and A-category trade o Three towns to be targeted in the first phase owing to already established market and logistics facility o Currently, the distribution operations are being carried out in Lahore, being the biggest market for brick pack pasteurized milk o In second phase distributors will be appointed in Rawalpindi, Islamabad and Faisalabad Company has employed its sales force to ensure that sales targets are achieved and the desired level of product availability & market coverage is ensured. These will include Area Sales Managers and Regional Sales Officers. International Modern Trade (IMT) including Metro, Makro and Hyperstar being serviced by entering into direct agreement with these stores. Chillers have been placed at selective outlets to ensure proper product placement and effective in-store branding POS including posters, standees and wobblers/hangers is applied for awareness and sales support Sales and Distribution Growth o More towns will be added during the third phase of operations for launch of Pasteurized milk namely, Peshawar, Multan, Gujranwala, Sialkot, Gujrat and Jehlum o More channels of distribution to be explored once the existing channel reaches the saturation point. Further channels will include:
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Opening of Milk Shops in posh areas of major towns with facility of home delivery service Door to door delivery of milk in posh areas on Qing-Qi containing refrigerated hood Value Added Products o Yogurt has been launched in Lahore which is getting good market response o Butter and Cheese to be launched also o Yogurt, Butter and Cheese to be launched in other major towns after having achieved the desired results in the primary market
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Strategic Marketing Management Final Project CONCLUSION

There are a number of strategies used by the players in the market and to compete and sustain their positions in the market most players use a combination of strategies. They are not only defending their positions but also attacking the others too. As for MilkPak they are using mobile defense strategies; it recently proved this by launching MilkPak powder in order to diversify. However they have powdered milk products targeting Children NIDO and Tea Lovers EVERYDAY but still they diversified to gain edge. Moreover MilkPak is also using Counter Offensive Strategies as well to counter the attacks launched by Olpers. It doesnt ends here we will also find MilkPak defending its position in the market sometimes. When it comes down to Olpers we can observe that it used the Frontal Attack strategies combined with the Encirclement attack strategies in order to challenge Nestle MilkPak. When it comes to the advertisement Olpers caught attention and positioned its brand as a family product. Aggressive Advertisement and such a rapid increase in market share surpassing old challenger like Haleeb gave a strong and challenging feeling of presence to the Milk Industry of Pakistan. As we travel down to Haleeb, it is currently the follower in the market when we talk about market share but the product range it offers and the strategies it adopts are more like of a challenger. The Milk bottle Haleeb offer is a unique product not yet offered by any of the competitors in the market, the vast product range with both powdered and liquid skimmed milk is another unique move to compete with both powdered milk industry as well as with the liquid milk industry. Haleeb gold is extra cream milk targeting those who love drinking milk that is thick n pure. Two types of tea max range cater different types of tea lovers. These all products are a mixture of challenger and follower strategies. In the case of Prema Milk, it caters the niche of Pasteurized milk market and offers more healthy milk with all essential nutrients to its customers. It caters the niche of those people who think that UHT treated and Gawalas milk is not good for their health and they should switch to tetra packed Pasteurized milk.
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Strategic Marketing Management Final Project REFERENCES

1. 2. 3. 4. 5. http://www.pddc.com.pk/DairyPakistan-Publication.pdf http://www.fao.org/corp/statistics/en/ http://www.pakistaneconomist.com/issue2000/issue21/i&e1.htm http://www.brandchannel.com/features_effect.asp?pf_id=445 DAIRY SECTOR PAKISTAN, M. Afzal, Livestock and Dairy Development Board, Islamabad 6. http://www.tbl.com.pk/tetra-pak-dairy-hub-initiative-a-community-dairy-developmentprogramme/ 7. http://www.scribd.com/doc/29507716/Pakistan-Milk-Industry 8. http://www.scribd.com/doc/26254329/Olpers-Crystal-Water-marketing-plan 9. http://www.tetrapak.com/Document%20Bank/2010_PR/Dairyindex_July2010.pdf 10. http://www.tetrapak.com/about_tetra_pak/press_room/news/Pages/tetra_pak_forecasts_c ontinued_growth.aspx 11. http://www.scribd.com/Arshia8/d/14080784-Advertising-Plan-Olpers 12. http://www.pakissan.com/english/allabout/livestock/dairy/dairy.industries.in.pakistan.sht ml 13. http://www.scribd.com/doc/59857473/Prema-Milk-MM 14. http://www.paktechsearch.com/Dairy.asp 15. http://www.scribd.com/doc/55941732/Market-share-of-tetrapak-milks 16. http://www.pddc.com.pk/DairyPakistan-Publication.pdf 17. http://www.fao.org/corp/statistics/en/ 18. http://www.pakistaneconomist.com/issue2000/issue21/i&e1.htm 19. New case study from Pakistan: milk production and marketing by small and medium scale contract farmers by Tanvir Ali, University of Agriculture, Faisalabad, Pakistan 20. http://www.nestle.pk/Brand/AmbientDairy/Pages/MILKPAK.aspx 21. http://www.scribd.com/doc/7759926/Engro-Foods-Olpers 22. http://engro.com/our-businesses/engro-foods-limited/ 23. http://www.linkedin.com/company/haleeb-foods-limited 24. http://www.scribd.com/doc/29987448/Marketing-Strategies-of-Olpers-and-Milkpak 25. http://www.haleebfoods.com/haleeb/ 26. http://www.scribd.com/doc/34439721/marketing-strategies-of-Olper-s
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Strategic Marketing Management Final Project

Analysis of Pakistans Milk Industry

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Analysis of Pakistans Milk Industry

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Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project EXECUTIVE SUMMARY

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project PAKISTAN MILK INDUSTRY

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project INTRODUCTION TO THE MILK INDUSTRY

Analysis of Pakistans Milk Industry

Analysis of Pakistans Milk Industry

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project PEST ANALYSIS

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Strategic Marketing Management Final Project

Strategic Marketing Management Final Project PROCESSED MILK INDUSTRY

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Pakistans five main product segments

We will discuss MilkPak, Olpers, Haleeb and Prema in detail.

Analysis of Pakistans Milk Industry

Estimations of UHT Milk Production and Consumption up to 2008 09

Annual Production Year (million liters)

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project NESTLE MILKPAK

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Key factors are: Changing lifestyle Influence of foreign media

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Promotion: Focusing on health conscious people in their advertisement.

Promotion Mix Advertisement Public relations

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project OLPERS MILK

Strategic Marketing Management Final Project

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Positioning the Brand

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Analysis of Pakistans Milk Industry

Strategic Marketing Management Final Project

Strategic Marketing Management Final Project

Analysis of Pakistans Milk Industry