Richa Srivastava MS11A044

Portable Refrigerator
MyFridge

PRODUCT
Specifications

Works on Compression model

Comes bundled with an adapter Removable baskets instead of one deep compartment Inbuilt battery protection

Competitors TROPIcool Mobile Fridge cum Warmer Model Godrej Chotukool Haier portable fridge (if launched in India)

Market Research
Current Big players in refrigeration industryLG, Samsung, Haier, Whirlpool & Godrej

Only Godrej and Haier have portable fridges.

Godrej Chotukool in India Haier portable fridge in US
Market share of major players

Government Spending in Rural

Size of Rural Markets

FMCG Agri-inputs Durables Automobiles (2 & 4 Wheelers) Clothes, footwear etc. Construction material Total
Source: CII Report (2008)

Rs.65000 crore Rs.45000 crore Rs.5000 crore Rs.8000 crore Rs.35000 crore Rs.15000 crore Rs.173000 crore

Target
Students
As per Indian government, the proportion of young people going to university will increase from 12% at present to 30% by 2025
Historical data

Rural India
Only 8% penetration in rural India.

Target
Proliferation of brands in urban High saturation levels in urban Greater awareness of brands in rural Ever-growing aspirations in rural

No brand caters to students needs of having a cooled drink at an affordable price 24 hrs in his room. Loyalty low but absence of competitors.

SWOT Analysis
Strengths Weakness Longer development cycles Higher cost of production due to heavy advertising.

Internal Factors

Technological Innovation Aggressive advertising Product range

Opportunities Rural India almost untapped market.

External Factors

Growing college going student population in the country. Low credibility of Chinese players in the market. Changing aspirations and income levels Potential for servicing other developing nations

Threats Regular sized fridges New competitors. Cloning of successful technology. Price wars with competitors.

External Factor Analysis

Key External Factors
OPPORTUNITIES
1 2 3 4

Weight

Rating

Weighted Score

Rural India almost untapped market. Growing college going student population in the country. Low credibility of Chinese players in the market. Changing aspirations and income levels THREATS

15% 15%

4 4

0.6 0.6

9%
12%

3
4

0.27
0.48

1 2

Regular sized fridges Cloning of successful technology. Price wars with competitors. New competitors. TOTAL

8% 10% 15% 8%
1

2 3 3 3

0.16 0.3 0.45 0.24 3.26

3
4

Issue Priority Matrix

Probability of Impact on Corporation High Rural India almost untapped market. Growing college going student population in the country. Changing aspirations and income levels Medium Low

High Probability of Occurrence

Low credibility of Chinese players in the market.

Medium

Potential for servicing other Price wars with developing nations competitors. Cloning of Successful technology New Competitors Regular sized fridges

Low

Internal Factor Analysis

Key Internal Factors STRENGTHS 1 Technological Innovation 17% 15% 10% 3 3 3
0.51 0.45 0.3

Weight

Rating

Weighted Score

2 Aggressive advertising
3 Product range WEAKNESSES 1 Long development cycles 2 Higher cost of production due to heavy advertising.

15% 20% 15% 8% 0.92

1 2 3 3

0.15 0.4 0.45 0.24

3 Setting up new distribution networks 4 Smaller pockets TOTAL

2.26

IE Matrix
IFE SCORE

2.26, 3.26

EFE SCORE 2
1 IFE = 2.26 EFE = 3.26

Competitor Profile Matrix

MyFridge
Critical Success Factors Market Share Product Quality Price Weight 0.15 0.15 0.14 Rating 4 3 3 Weighted Score 0.4 0.36 0.42

Godrej Chotukool
Rating 4 3 2 Weighted Score 0.4 0.36 0.28

Advertising
Customer Loyalty Brand Equity Financial Position Global Presence R&D Profit Margins Total

0.15
0.06 0.06 0.12 0.08 0.09

3
2 2 2 1 3

0.24
0.12 0.12 0.24 0.12 0.12

4
2 3 4 3 3

0.32
0.12 0.18 0.48 0.36 0.12

2.14

2.62

TOWS matrix
Organizational Strengths Technological Innovation Aggressive advertising Product range Organizational Weaknesses Long development cycles Higher cost of production due to heavy advertising. Setting up new distribution networks

Environmental opportunities Rural India almost untapped market. Growing college going student population in the country. Low credibility of Chinese players in the market. Changing aspirations and income levels Potential for servicing other developing nations Environmental threats Regular sized fridges Cloning of successful technology. Price wars with competitors. New competitors.

Evolving rural population and student demographics can be tapped through aggressive advertising R&D capabilities could be used to develop products best suited for developing and evolving geographic and demographics needs (Market and Line Expansion)

Could focus on cutting down the development cycles. Could use its R&D, Product Development ,Marketing and Distribution expertise for gaining competitive advantages in developing markets

Use early bird advantage and market knowledge to drive out the newer competitors Use R&D capabilities and experience to shrink the cost structure in order to improve overall profitability

Could buy out low cost competitors.

Porters 3 Generic strategies

The product targets two unique segments students and rural India. It is trying to achieve a balance between low cost / low pricing and unique offering.

Grand Strategy Matrix

Rapid Market growth
Quadrant 2
Product development market development Market penetration Horizontal/ vertical integration

Weak competitive position

MyFridge

Strong competitive position

Slow Market growth

Applications of SWOT
Numerous environmental Opportunities

MyFridge
Conservative Strategy Aggressive Strategy

Critical Internal Weakness

Substantial Internal Strengths

Defensive Strategy

Diversification

Major Environmental Threats

Strategic Position and Action Evaluation Matrix

Industry Strength
Evolving Demographics and Aspirations in developing markets Profit Potential Growth Potential 4 3 4

Financial Strength
Strong financials Profit Margins Ability to raise capital Ease of exit from markets. 2 3 2 1

Financial Strength

Average = 3.66

Average = 2 Competitive Advantage

Huge experience in innovating, producing, Competitive advertising and distributing products -1 -1 -2 -3 -3 -4

Advantage

Environmental Stability
Improving trade-relations and conditions amongst economies. Customers becoming increasingly price sensitive, esp in emerging economies. Price war between MyFridge and competitors. Increasing inflation.

Brand Image Market Share Product Quality Customer Loyalty Opportunities for up-sell and cross sell

Industry Strength
-2 -1 -3 -4

Average = -2.5

Average = -2.33

Strategic Position and Action Evaluation Matrix

Financial Strength Financial Strength

Competitive Advantage Advantage Competitive 1.33, -0.5

Industry Indutry Strength Strength

4.99, -0.5

Environmental Environmental Stability Stability

Strategic Position and Action Evaluation Matrix

Financial Competitive Strategies Strength Horizontal Integration Market Penetration Market Development Competitive Advantage Product Development

Industry Strength

Environmental Stability

Environmental Threat and Opportunity Profile

Factors Political Opportunities and Threats Opportunities: Improving Trade relations and condition amongst economics Opportunities: Evolving with the New Markets Threats: Price wars amongst Competitors, increasing price sensitivity of consumers Opportunities: Targeting the rural and students Threats:- Low acceptability in rural population Opportunities:- Lean Production Process Threats:- More efficient and lean production of Competitor Threats:- Imitation or Substitution of the product in market at cheaper price

Economical

Social Technological Environmental

Strategic Advantage Profile

Internal Area Marketing and Sales Competitive Strength/Weakness (+) Quality of products and services (-) Setting up distribution network from scratch (-) Longer time for product development (-) Weak financials (-) Cost of production can be brought further down (+) Operational efficiency from start

Finance

Operational

QSPM
Weight Strengths Technological Innovation Aggressive advertising Product range Weaknesses Long development cycles Higher cost of production due to heavy advertising. Setting up new distribution networks Smaller Pockets Opportunities Rural India almost untapped market. Growing college going student population in the country. Low credibility of Chinese players in the market. Changing aspirations and income levels Potential for servicing other developing nations Threats Regular sized fridges Cloning of successful technology. Price wars with competitors. New competitors. Sum TAS 15% 15% 9% 12% 8% 4 4 2 3 3 17% 15% 10% AS 3 3 2

Strategy 1 Market Development stand TAS 0.51 0.45 0.2

Strategy 2 Market Penetration stand AS 4 4 3 TAS 0.68 0.6 0.3

Strategy 3 Product Development stand AS 4 4 3 TAS 0.68 0.6 0.3

15% 20% 15% 0.07

2 2 3 3

0.3 0.4 0.45 0.21

2 2 4 3

0.3 0.4 0.6 0.21

3 2 4 3

0.45 0.4 0.6 0.21

0.6 0.6 0.18 0.36 0.24

4 4 3 3 4

0.6 0.6 0.27 0.36 0.32

4 4 2 3 2

0.6 0.6 0.18 0.36 0.16

8% 10% 15% 8%

0 1 3 2

0 0.1 0.45 0.16 5.21

0 3 2 2

0 0.3 0.3 0.16 6

0 3 2 2

0 0.3 0.3 0.16 5.9

Strategy to be followed
Market penetration
Increase the customer base by aggressively advertising and launching new products. Target newer geographies/ regions

Product
Has foldable flaps attached so that when expanded it acts as a small table as well to facilitate dining. Has removable baskets instead of one deep compartment to provide compartmentalization Comes with an AC/ DC adapter so that it can be plugged into electricity when needed.

Promotion strategies
Contrary to popular belief people in Rural India are fiercely brand loyal
Single Brand Villages

Once converted, difficult to dislodge them First mover advantages Participate in local events/ festivals. Participate in college fests.

Route to Brand Building in Rural

Build Customization Build Empathy / Relevance
Eg. Nokia Life Tools for farming and rural community Agri information to farmers in association with Reuters Imparting of knowledge of English language to students by teaching one new word every day

Build Recognition
Rural folks understands symbols and colours better.
+ Laal Sabun Lifebuoy + Peela Powder Nirma

Distribution Strategies
Build Access
Distribution in rural India is not a nightmare For consumer durables reach towns with population of 50000+ and also Look at opportunities in haats, melas, post offices, public distribution system etc.

Build word of mouth

Through effective communication using specific communication package aimed at specific rural audience Importance of opinion leaders Educated village youth as opinion leaders Women and children as demand generators Customized events targeting specific groups with focused communication

Marketing channel
Rural India Rural Cinema TV Radio Mass Media Students Multiplexes TV Social Media Online advertising Promotion campaigns in/ near colleges

Pricing Strategies
Low cost product Easy affordability by both students and people in rural India. Profit margins low to maintain low cost

Communication Strategies
Rural Communication Keep the communication simple
No scope for gimmicks

Take time in communicating the message

Quickies have no impact.

Think in the local language to capture the local spirit in the communication aimed at specific region. Demonstration a key element for success

Communication Strategies
Student Communication Keep the communication flashy
Lots of scope for gimmicks.

Take less time in communicating the message

Long messages tend to lose out audience interest.

Demonstration a key element for success

Thank you....