Market Analysis & Target Market Strategy | My Assignment Tutor

MMK368 Business Marketing Trimester 1, 2021 Assessment 1B – Market Analysis & Target Market Strategy Name: Sebastian James Setiawan Student ID: 218602829 Submission Date: 27th May, 2021 Executive Summary The purpose of this report is to present a market analysis for APMC pallet film wrapping in the alcoholic drink industry for the market in Brazil. The market analysis comprises of seven key parts to clearly identify, evaluate, and justify the three potential segments for AMPC target to generate viable business in the Brazilian market. The data used in this report is collected from PASSPORT. Through the analysis, three segments that AMPC will target are high-usage customers, medium usage customers and large usage customers under the Alcoholic drinks’ categories such as the Beer, Wine, Spirits, RTDs and Cider/Perry, and small customers. An application of Pareto 80/20 rule to this market analysis aims to highlight the 13 most important companies for AMPC to devise appropriate marketing strategy to improve its business development, particularly for the alcoholic drinks company in Brazil. Table of Contents List of Tables 4 List of Figures 4 Market Analysis 5 Market Demand 5 Market Segmentation 6 Target Market Strategy 7 Product 7 Distribution 7 Promotion 8 Promotion – Personal Selling 8 Pricing 8 References 8 Appendices 9 List of Tables On page 12-15 List of Figures On Page 11-12 Market Analysis Market Demand The Table 1 has shown that in the year 2019, the APMC Profit has produced for around $82,971,774 in regard to the Alcoholic Drinks which is based from the sales of the plastic wrap and the film for the packaging on the companies drinks in Brazil. Furthermore, this profit was attained during the association between the APMC and the Alcoholic drinks company in Brazil. In fact, in order to be able to review with more additional details on the tables, we need to grasp each of the database within the profit from where it came, in which it will be discussed below. Based from the Table 2, In 2019, Brazil has shown every different consumption from each of the five different types of Alcoholic Drinks. First of all, Brazil has a substantial market demand for the Alcoholic Drinks. According to the sales volume, Brazil could possibly sell their Alcoholic drinks for 13,828,629,000 as in Litres, while for the Tonnes it would be 13,828,629. In addition, this figure is obtained from every types of the Drinks. So therefore, from the five different categories of the Alcoholic Drinks such as the Beer, Cider/Perry, RTDs, Spirits and Wine. First, the Beer would become one of the highest demands with a total of 12,633,987,700 in Litres and for Tonnes it is 12,633,987.70 on 2019. Second, is the Spirits that has 712,113,200. in Litres and 712,113.20 in Tonnes. Next, the Third would be the is the Wine which has a demand of 330,365,400 in Litres, while the Tonnes is 330,365.40. Then, on the fourth are the RTDs that has a total of 135,117,200 in Litres or 135,117.20 in Tonnes. And finally, the drink that has the lowest demand is Cider/Perry with the sales of 17,045,600 in Litres and 17,045.60 in Tonnes. As a result, if the five categories alcoholic drinks are being syndicated together the final total sales would become 13,828,629,000 in Litres or in Tonnes is 13,828,629.00. For the prediction of the Alcoholic Drinks industry in Brazil during the 2019 – 2024 period as being depicts from Table 3. The market size of US soft drinks industry is forecasted to slightly decreased by around 2%, from $13.8 million in 2019 to $12.3 million in 2024. On the other hand, the size market for the alcoholic drinks of Brazil also have reduced a tad in the year 2021 with an approximation of about 5% in 2019 with total of $13.8 million in 2019 to $11 million. However, in 2024 has re-increased from the year 2021 which the total is estimated of $11 million to $12.3 million. Thus, each of the shares from the producer of the alcoholic drinks in Brazil is going to be represented in figure 3. Market Segmentation In particular, to be able on regulating the market segment, it is obligatory to recognize that the viability can be accessed from the criteria, as in fact there are four different criteria that could be able to determine each of the segmentations. First, would be that the segment market can have the criterion that are quantifiable as if every of the segments has already meet the standards and followed by being able to provide several information of the customers. Second, having an accessibility can also the make the criterion become measurable, the APMC profit from the amount of Marketing is basically about focusing on the aspects and segments of the customers. Third, the substantive criterion for the market segment are rather justifiable and the APMC is profitable enough to have the target market strategy being separated. And lastly, the responsive criterion of the market segment is that the customer could possibly respond the target market strategy to which each of the segments have already been developed. Furthermore, for the base market report it has a segmentation that are based from customers distinctive, particularly the types of product and the usage rate in determining or segmenting the market itself. In other words, the market will be divided into three elements, which is the customer’s high usage ($1 million or more), medium usage (from $27 thousand to $117 thousand) and finally the low usage (up to $14 thousand). Additionally, the market base also has included different characteristic of the customers or buyers, such as the purchasing strategy and policies, importance of purchases, risk of attitude and the buyer’s personal appearances. Finally, with the market segmentation there are several clarifications that have provided with an assumption, for instances in the substantive test the profit of the APMC will be expected to earn approximately at least $2 million in the yearly profit to become worth table. Moreover, the APMC also have assumed that the market shares can make 15% from the competitors before reaching a decision to go inside the country. And also, the APMC assumed that the market profit will receive $40 per ton. Target Market Strategy Product Distribution Regarding about the product materials, every target of the customers is looking for sensible information, as all competitor are possibly offering the product that are similar. Besides that, they would also appear to be a normal level of negotiation due to the fact that the market is very competitive. Additionally, several customers need the APMC in order to be able to modify their plastic film to some range for any precise products. Moreover, those alcoholic drinks for the customers are very essential. So therefore, our plastic wrap film that they anticipate are meant to be durable, water-resistant, flexible, and lightweight, as the APMC’s ability will be offered for every target based on their usage of the plastic film to be obtained. Though, to be able to buy the APMC’s products all of the targets need to necessitate power with the lot large size. For the collection, APMC plastic wrap is the only product that can be provided. On the other hand, regarding Availability, all targets need a high level of product, as they have only about 10% of the alcoholic drink that are available in the market at the moment and also they would expect the APMC profit to have high level of product availability and as well as offering the service’s pick up. Consequently, from Figure 3, the Target 1 and 2 requires the pickup service because it is suitable for the customers and two targets can possibly diminish the workforce as well. The product segments from the APMC are using the direct distribution due to the similarity of the product from the features and the nature. Hence, by applying the direct distribution every of the target market is necessary. In addition, by using the direct sales, APMC can control the selling market and they also need to make sure that each of the plastic wrap is wrapped in a correct way and to assure of providing a quick response to the conditions of the market. On the other hand, according to the online marketing channel from Figure 5, APMC will also use this system in order to attract or expand awareness on the potential customers or using it from every different target through the search engine optimization, social media, email and display advertising. Similarly, based from Figure 5 on the tele-marketing, the APMC will basically rely only on the Target 3, cause the distinctive manufacturers to have approximately seventy-seven which is enough for the APMC to spend some money. However, for the Target 2 the APMC does not want to spend any money on their tele-marketing because the Target 2 has similar potential revenue as Target 3, as the Target 2 only comprises of twelve unique manufacturers. Lastly, on the distribution channels section, the APMC have as well use the industrial distributors as indirect channels to make mindful for Target 3 in regard to the product APMC. Nevertheless, APMC must require searching an intermediary which must be independent and impartial. As mentioned in the Figure 5, Target 3 consisted of seventy-seven unique manufacturers, to which the APMC will be able to apply the independent intermediaries in order to re-contact in the Target 3, rather than using its particular services. Promotion Promotion – Personal Selling Pricing You need to demonstrate your understanding of pricing concepts and processes. The target market strategy will include a pricing strategy and set prices. You need to develop a targeted marketing strategy and to explain and justify the decisions you make about pricing. First, according to Campbell (2020) ‘Pricing or Pricing Strategy is one of the process of pricing that can determine each of the businesses companies about what way to properly sell their goods and services with an cost prices that are flexible or efficient.’ In fact, this strategy has the most regularly overlooked and underrated income levers in many different business organizations and also by carefully choosing the suitable pricing strategy could produce a deep understanding of each product, market, and even the customers. In addition, there are basically three different pricing strategies which are commonly used in the market and they are Value based pricing, Competitor based pricing and Cost-plus pricing. And first of all, for the cost-based pricing is regarded as the simplest way of determining the price because it represents the knowledge and ideas that are quite straightforward from doing any type of business. In other words, as an example, if a customer creates something and sell the product 20% more than the other customer, the competitor had spent the money on making similar perception of the product and purchase somewhat a fine product with a slight difference. So therefore, this method has included a very little market research, and also the demands of the customers and strategies of the competitors does not remove any consideration whatsoever. Second, the competitor-based pricing is basically more like a type of pricing that essentially ineffective or plagiarism, as this kind of method includes contemplating at the setting of the prices from another businesses that has similar subdivisions, and then those number of prices are being accepted with either having the plus or minus percentage based on the looks of each products. Furthermore, this particular type of pricing remains a simple and also having the method that has low risk on measuring prices that accounts for market share and other factors in a quick way, to which in some cases the competitor pricing will become fairly precise and certain businesses are required to use the competitor based pricing widely because the prices of each consumers that had been compared with the switching costs on buying a product at any kinds of stores has remained remarkably low. Finally, for the References Campbell, P, 2020, ‘Pricing Strategy Guide: Top Pricing Strategies and How They Unlock Growth’, ProfitWell, accessed 26th May, 2021. PASSPORT (2019). http://www.portal.euromonitor.com, accessed 25th May, 2021. List of Appendices Table 1: the total sales of APMC profit on the Alcoholic Drinks GeographyCategoryData TypeUnit2019APMC ProfitBrazilAlcoholic DrinksTotal Volume000 litres13,828,629.0$ 82,971,774 Source: Passport, 2019 Table 2: The total consumption from the five different types of Alcoholic Drinks in Brazil (Beer, Wine, Spirits, RTDs and Cider) GeographyCategoryData TypeUnit20192019 Data in Litres2019 Data in TonnesBrazilAlcoholic DrinksTotal Volume000 litres13,828,629.013,828,629,000.0013,828,629.00BrazilBeerTotal Volume000 litres12,633,987.712,633,987,700.0012,633,987.70BrazilCider/PerryTotal Volume000 litres17,045.617,045,600.0017,045.60BrazilRTDsTotal Volume000 litres135,117.2135,117,200.00135,117.20BrazilSpiritsTotal Volume000 litres712,113.2712,113,200.00712,113.20BrazilWineTotal Volume000 litres330,365.4330,365,400.00330,365.40 Source: Passport, 2019 GeographyCategoryData TypeUnit201920202021202220232024BrazilAlcoholic DrinksTotal Volume000 litres13,828,629.011,347,355.611,090,555.611,307,512.611,742,077.512,287,240.9BrazilBeerTotal Volume000 litres12,633,987.710,394,443.410,170,105.410,365,657.510,761,300.711,260,170.6BrazilCider/PerryTotal Volume000 litres17,045.614,960.114,166.913,818.213,701.713,719.2BrazilRTDsTotal Volume000 litres135,117.2111,950.5106,436.3106,248.2107,549.6109,119.7BrazilSpiritsTotal Volume000 litres712,113.2534,692.8498,552.7496,675.5502,156.8509,961.8BrazilWineTotal Volume000 litres330,365.4291,308.7301,294.4325,113.1357,368.7394,269.6 Table 3: The Market Demand prediction from 2019 – 2024 Source: Passport, 2019 Table 4: Low, Medium, and High usage of APMC profit and tons in Brazil CategoryCompany NameTonsAPMC Profit $Alcoholic DrinksPrivate Label12557.675345.6Alcoholic DrinksBacardi & Co Ltd12581.275487.2Alcoholic DrinksCasa Di Conti Ltda1340080400Alcoholic DrinksOthers (117 small companies)1621858.39731149.8Alcoholic DrinksCRS Brands Indústria & Comércio Ltda14271.585629Alcoholic DrinksIndústria de Bebidas Paris Ltda27989.4167936.4Alcoholic DrinksCooperativa Vinícola Aurora Ltda29614.8177688.8Alcoholic DrinksVinhos Salton SA Indústria e Comércio32955.5197733Alcoholic DrinksPernod Ricard Groupe35484.4212906.4Alcoholic DrinksArbor Brasil Indústria de Bebidas Ltda43346.1260076.6Alcoholic DrinksCampari Milano SpA, Davide44011.4264068.4Alcoholic DrinksEngarrafamento Pitú Ltda60700.3364201.8Alcoholic DrinksIndústrias Reunidas de Bebidas Tatuzinho / 3 Fazendas Ltda64109.3384655.8Alcoholic DrinksDiageo Plc106548.7639292.2Alcoholic DrinksCia Muller de Bebidas Ltda117005.7702034.2Alcoholic DrinksCervejaria Petrópolis SA1638595.99831575.4Alcoholic DrinksHeineken NV2481170.514887023Alcoholic DrinksAnheuser-Busch InBev NV7472428.344834569.8 Source: Passport, 2019 Table 5: Customer Service GAP’s for the Alcoholic Drinks in Brazil Reliability GAPResponsive GAPAssurance GAPEmpathy GAPTangibles GAPTotal Service GAP-5-70-30-150-3-6-30-120-4-30-2-90-2-500-700-20-2-400-400-4-10-1-10-30-1000-10000000000000000000000000000000000000000000000001-21000001102 Table 6: Attractive, Neutral and Avoid of the Alcoholic Drinks in Brazil AttractiveNeutralAvoidCervejaria Petrópolis SAArbor Brasil Indústria de Bebidas LtdaCampari Milano SpA, DavideCia Muller de Bebidas LtdaPrivate Label Engarrafamento Pitú LtdaOthers (117 small companies) Vinhos Salton SA Indústria e ComércioAnheuser-Busch InBev NV Casa Di Conti LtdaIndústria de Bebidas Paris Ltda Cooperativa Vinícola Aurora LtdaCRS Brands Indústria & Comércio Ltda Diageo PlcIndústrias Reunidas de Bebidas Tatuzinho / 3 Fazendas Ltda Heineken NVBacardi & Co Ltd  Pernod Ricard Groupe  Table 7: Attributes – CoreCustomer BenefitsLightweight Safety Transparency ReusLess product breakage, less theft Benefit Benefit Benefit Figure 1: Core attributes / Customers Benefits Figure 2: Augmented attributes / Customers Benefits Attributes – AugmentedCustomer BenefitsCustomer brand printed on film Attribute AttributeCustomer awareness among retailers Benefit Benefit Figure 3: Intangible attributes / Customers Benefits Attributes – IntangibleCustomer BenefitsOn-site service Attribute AttributeIncreased customer productivity Reduced customer downtime (savings) Benefit Benefit Figure 4: positioning map of APMC’s product LOW HIGH Product Strength HIGH PRICE LOW Figure 5: APMC product and services to its customers