Analyzing Business Markets

Brand to brand:

• Earlier, Quaker Oats was importing raw material from Australia. However, in 2008, it tied up with farmers in Punjab, MP, Karnataka, Rajasthan, Jharkhand, Maharashtra, West Bengal, for growing oats rather than exporting it. Thus, covering about 50000-60000 acres, involving around 40,000 farmers in 10 states of the country including those mentioned above.

•  The company is associated with Indian Grassland and Fodder Research Institute (IGFRI) in Jhansi, under the administrative control of ICAR and is mandated to conduct basic, strategic, applied and adaptive research development and training in forage production and it's utilization.

• It has a manufacturing plant spread over about 7.5 acres in Channo, Patiala where it is producing other snacks under PepsiCo.

• Currently, the majority of our packaging is made with recycled materials. So far this practice has enabled the reuse of over 9,500 tons of recycled paper per year.

• The retailers for the same are online stores and stores spread all over India in the major cities, at the major locations within the cities.

• The supply chain is improved by looking at the consumer database at a particular location.

Brand to Consumer:

Analyzing Consumer Markets:

• Quaker oats lies in the category of food; therefore, it lies in the physiological need which means that it meets your basic needs. 

• It is produced on a mass-scale.

• Since it directs "health" of the consumer, it somewhere fits in "need to belong" category in order to say, stay slim and healthy.

Sales Management

• Giving discounts on buying quantities in bulk.

• Giving out the offers. For example:- 3 packets of Oats of Rs 10 each would cost Rs 30 altogether but the offer could be to buy 3 packets of oats for just Rs 27. Thus, selling more of your product in bundles and making sure that saving on the price bundle must be enough to induce the customers to buy it.

• Provides a mechanism for free online health check-ups from time to time.

• They first aimed at creating the habit of consuming oats regularly of the existing customers rather than tapping a new market.

• Easy availability to the customer that is by avoiding delay right from the beginning of the chain i.e. for instance, delivering to the distributor must be quick.

• CRM application is used to determine profitable customers, potential sales opportunities, customer interaction and relations.

Holistic or Sustainable Marketing

PepsiCo focuses on sustainability of several domains:

• Talent sustainability (includes employment sustainability) by creating appropriate employment opportunities and being open to diverse workplace.

• Human sustainability by managing the nutrition needs; they joined with International Food & Beverage Alliance (IFBA), a Swiss-based NGO, comprising multinational food and beverage manufacturers, to promote only healthy products for children below 12 years of age.

• Environmental sustainability by  taking care of the natural resources and being careful about the harm caused to the environment. 

• Food safety sustainability by using the bioengineered crops which offer various economic and productive benefits like resistance to weeds, pests and diseases,reducing the need for agronomic chemicals, resistance to climatic stress and so on.

• Water Sustainability: In 2009, PepsiCo India achieved a significant milestone, by becoming the first business to achieve ‘Positive Water Balance’, verified by Deloitte. 

• Farmer Sustainability: In 2006, PepsiCo India developed a Direct Seeding Machine for paddy which can sow the seeds uniformly at a specified gap and at a uniform depth. Using this seeder, direct seeding was carried out in the fields of 12-farmers, covering about 20-acres. PepsiCo also studied the advantage of sowing the seeds, followed by herbicide treatment and thereafter irrigation. Pre-treatment with an herbicide helped reduce de-weeding labour from five times to two times in direct seeding compared to flood irrigation.

Thus, it ensures healthy living of people throughout the world and also ensures that the earth's resources aren't depleted and utilized optimally.

Branding

Brand Building is the key!

• Pepsico had just launched a campaign called the "Quaker Smart Heart Challenge" on TV, radio, cinema, digital, and new media to build awareness of the product.

• They are also doing massive sampling (both wet and dry) in retail, corporate, hospitals, etc. to introduce customers to the benefits of the oats.

• In order to build customer relationship, several ways to meet customer service goals are: Increasing online customer service and interaction.

• Provide answers to problems online.

• Become reliable and gain consumer trust.

• Start conversation and engage consumers by giving them health tips.

• Creating health awareness through polls and quizzes.

• Giving nutritional value of complementary foods along with oats.

• Create a user-centric experience policy Offer rules, tips and ways to get involved with Social, Service Media Team.

•  Listen to consumers' needs and problems Respond quickly and efficiently.

Segmentation, Targeting and Positioning

Segmentation:

Geographic Segmentation: Their aim is to grow in the nutrition space globally. They have increased the sales in UK and have a firm foothold of positioning itself as a breakfast cereal in China and India followed by Russia.

Demographic Segmentation: People between 10-45 years of age can consume it. Both the genders have a need to stay fit and healthy, several packs of oats are available ranging from Rs 10 pack of 28 gm to 1 kg pack of Rs 165 thus, mostly targeting middle class people with an average income who can consume it on daily basis. Those people whose occupation is that of working in companies (who get less time to workout), housewives and students. No religion/race/nationality bar set. It's a product that can be consumed by almost everyone and anyone.

Psychographic segmentation: Social class:- mainly middle class, lifestyle:- people with hectic lives, personality:- health conscious.

Behavioral segmentation: Occasions:- It is a cereal to be consumed daily in order to stay fit and healthy(benefits), customers are happy with the availability of different flavours thus, are loyal.

Targeting:

Primary: Middle class families (with hectic schedules), women, mothers, students, professionals, Patients with high cholestrol problem.

Secondary: Kids, old people.

Middle class families: The customers in this category are usually the mothers.

Mothers: They purchase by looking at the factors like convenience, health benefits, easy availability, family perspective, health safety, easy and quick to cook, in budget.

Students: Consume it by looking at factors like health benefits, taste, convenience (late night lectures, assignments), quick to cook, easy availability, sustainability, filling.

Professionals: Mostly those who  working, less work out, need to stay healthy and fit, quick and easily available.

Positioning: 

• Quaker Oats is positioned as "any time nutrition" cereal rather than just as "breakfast cereal". Since they help in weight management, leveraging on other benefits that it has to offer, will help provide variety to the communication.

• It has positioned itself to the "health conscious" market since it has fiber, no cholestrol and can be consumed for breakfast.

• It has also positioned itself as "easy and quick to cook" cereal.

• It is easily available at any kirana store, grocery store, food mart and so on. Thus, an easily available product that wants to reach out to maximum people.

Promotion (Integrated Marketing Communication)

Quaker Oats had close to four years to establish its presence before other big players stepped into the breakfast oats space. It did this with traditional TV and print ads, as well as online. 

• In 2008, Fritolay India, the snack foods division of PepsiCo, entered into a deal with the Indian Medical Association (IMA) whereby the IMA would endorse Quaker Oats. It was made to promote the product as healthy, promote the sales and influence consumer behavior.

• In 2009, apart from the usual social media presence, the company also created "Good Morning Heart" campaign, and it suddenly made an announcement for the office-goers  that by 2010 around 46.9 million heart disease cases would be reported in India. With this data, the company urged people to change their eating habits and move to a healthier lifestyle. It then started the “mission to make India heart healthy” in collaboration with Apollo Hospitals, Chennai police and some corporate houses, where it offered an online health diagnostics, healthy cooking and fitness tips, personalized advice from nutrition specialists and dietitians.

• A new campaign includes a TV ad that shows people dozing off on buses, at work and at home; it then encourages consumers to fight the "human energy crisis" with the "good energy of Quaker" and its array of oatmeal-based products, from bars to hot cereal. 

 

• Quaker is now promoting the use of oats in Indian dishes such as dosas, uttapams and idlis, which is quite an interesting direction. Consumers who have used these recipes appear to be loving them. Several positive comments regarding the experiments done by consumers can be read on the website from time to time. Discounts, coupons and prices are available on the website of Quaker Oats along with free Quaker recipes. 

• Other websites like http://bigbasket.com/ also promote the sales by giving discounts.

Distribution

A typical supply chain for imported food products such as oats consist of:

Overseas exporter of oats 

↓

Indian importer in bulk and Packing in retail packs with Brand names 

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Distributor

↓

Supermarket/Food stores

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Consumers

Earlier, Quaker Oats was importing raw material from Australia. However, in 2008, it tied up with farmers in Punjab, MP, Karnataka, Rajasthan, for growing oats rather than exporting it.

In Pune, RamNaresh Enterprises is the leading exporter & wholesaler of oats who also claim their oats to provide features like enhanced shelf life, no adulteration, great taste and healthy. The  wholesaler are located at Keshavnagar Mundhwa in Pune.

Similarly, several wholesale outlets, retailing outlets, grocery stores, health markets, convenient stores, and so on are present in other states as well.