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Marketing Strategies of ITC's Bingo

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Introduction

INSTITUTE OF MANAGEMENT TECHNOLOGY, NAGPUR Marketing strategies of ITC's Bingo Marketing Management I End Term Project Submitted by : Aishwarya S Iyer 08FN007 Amit Verma 08FN012 Anjan Sethi 08FT012 Abhishek Sharma 08HR003 Anchal Sharma 08HR010 Section A TABLE OF CONTENTS 1. Company Background 3 2. Indian Snack Market Overview 6 3. Bingo : The Launch 7 4. Marketing Strategies 8 5. Porter's Five Forces 11 6. SWOT Analysis 12 7. Creating Value 13 Company Background ITC is one of India's foremost private sector companies and is a member of BAT Group of UK, which holds 37 per cent stake in ITC, followed by domestic financial institutions and public. Rated among the World's Best Big Companies by Forbes magazine, ITC ranks third in pre-tax profit among India's private sector corporations. The company is an outstanding market leader in its traditional businesses of Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports, it is rapidly gaining market share even in its promising businesses of Packaged Foods & Confectionery, Branded Apparel and Greeting Cards. ITC's diversified status originates from its corporate strategy aimed at creating multiple drivers of growth anchored on its time-tested core competencies: unmatched distribution reach, superior brand-building capabilities and effective supply chain management. Over time, the strategic forays into new businesses are expected to garner a significant share of these emerging high-growth markets in India. ITC employs over 24,000 people at more than 60 locations across India. The Company continuously endeavors to enhance its wealth generating capabilities in a globalizing environment to consistently reward more than 3,81,000 shareholders, fulfill the aspirations of its stakeholders and meet societal expectations. This over-arching vision of the company is expressively captured in its corporate positioning statement: "Enduring Value. For the nation. For the Shareholder." Products & services: ITC has a diversified presence in Cigarettes, Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business, packaged Foods & Confectionery, Branded Apparel, Greeting Cards and other FMCG products. ...read more.

Middle

The entry was prompted by the fact that there are few players in this segment. There was only one organised large player (Frito Lay) at the national level in the packed snacks segment apart from some regional players. After making the decision to launch Bingo it started by sending a cross-functional team of eight individuals across the country to research the snacking habits of the Indian consumer. After travelling to 14 cities and speaking to more than 1,000 people, the team came back with an insight that Indian consumers were looking for novelty and excitement in existing snacks. ITC's strategy was to cater to Indian taste buds with very Indian flavours, to have a large scale advertising campaign and to use their strong dealer networks to ensure that Bingo is within arm's reach of its customers. They also used health positioning by emphasizing that Bingo was not fried but baked. PRODUCT While developing Bingo, the product development team fanned out across India, zeroed in on more than 200 snacks that are popular in various regions, including murukku, samosas, khakra and potato chips, and listed the dominant flavours. With flavours such as Masala Chaas, Chatpata Nimbu and Paneer Tikka, it has variants with truly Indian flavours. Though Frito Lay has had flavours like the recently launched Mint Magic and others like Latino, Spanish Tomato Tango, Cilantro, ITC has chosen to go the Indian way with success. They then took this list to ITC's hotel chefs who created 30-40 dips with these dominant and, sometimes, combination, flavours. They finally selected 16 taste platforms and tried them out on neutral bases. The company then blind tested these snacks across India. Any flavour with less than 75 per cent approval rating was rejected. Finally, it launched 16 variants, and will launch 10 more shortly. PRICE STRATEGIES Bingo was available in packs priced at Rs. 5/- and Rs. 10/- which was at par with its competitors. ...read more.

Conclusion

� Access to new/different markets � Premium product placement in retail leading to higher sales � Image and celebrity endorsements create hopes/dreams/emotional attachment to product � Influence of negative activities on brand name (i.e. sweetshops) � Products are expensive decreasing customer base � Trademark infringement from fake products resulting in decreased customer satisfaction (i.e. poor quality products carrying the stolen Bingo logo) Economies of Scale � Shared distribution channels among varied product lines lower costs � Large size provides opportunity for more leverage against competition � Able to support campaigns/sponsorships increasing brand recognition � Efficient use of production facilities lowers costs � Size of company may be difficult to control leading to operating inefficiencies � Large scales may lead to more Federal Regulation Geographical Outreach � Ability to reinforce brand and create loyalty across cultures leading to a broad customer base � Increased company growth potential � Cross-subsidization of weaker markets � Difficult to coordinate company activities across cultural norms (i.e. marketing, distribution) � Foreign currency risk � Language barriers creating difficulty to advertise effectively � International regulatory issues Innovation & Production � Innovation may be difficult for competitors to imitate � Difficult for competitors to compete with rate of innovation/production � Ability to capture market for different attitudes/values across cultures with product variety � Strong emphasis on R&D leads to continuous improvement in products � Significant resources required to support constant R&D/ innovation � Product development cycle typically long � Large number of products may create customer confusion and frustration � With presence in a number of market segments (i.e. shoes, apparel, watches) it may be difficult to constantly innovate Product Diversification � New products introduced by Bingo will be more readily accepted by customers due to strong brand image � Reduced exposure to demand fluctuations � Significant resources required to support product diversification � Difficult to be "the best" in all product segments � Difficult to implement constant innovation and improvement ?? ?? ?? ?? Bingo (ITC) Marketing Management I Page 13 ...read more.

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