Case Study Fruit Juices Industry Marketing Essay

Indian fruit juice market is an unorganized and newly developing market. Recently this sector is getting more organized and attracting more players in the market. Though, Now Indian are more health conscious, so they moving very fasting towards fruit juice. Indian fruit juice market is having a net worth of 275 crores as of now and in gearing at a rate of 35% to 40% per year. The nut tine value of real fruit beverages is far greater than of synthetic products, if the real fruit juices could be substituted for these synthetic preparations, it would be a boon to the consumer as well as the fruit grower. Drinking juice is not a part of our culture. We drink with our meals but in the west one starts the day with breakfast and a gloss of juice.

There are two main brands in this segment of non carbonated drink market.

Real from Dabur

Tropical From Pepsico

LEADING MANUFACTURERS OF FRUIT BEVERAGES IN INDIA

S.NO.

COMPANY

BRAND

FLAVOR

1

Parle Agro

Froots

Mango, Guava, Pineapple, Orange

2

Pepso Co. Ltd.

Tropicana

Orange, Apple, Grape, Pineapple, Tomato, Mixed Fruit Juice.

Real Active

Orange, Apple

3

Dabur

Real

Mixed Juice, Litchi, Mango, Pineapple, Grape, Guava, Orange.

Real Active

Orange, Apple

4

Godrej Foods

Tropicana

Orange, Apple

Real

Orange, Apple

XS

Orange, Apple

5

Coca Cola

Mazza

Mango

6

Voltas

Volfruit

Mango

7

Hindustan

Grapy

Red Graps, Litchi

8

Kerla Milk Mkt.

Milma

Mango, Pineapple

9

Salstar Foods

Regold

Mango, Apple Mixed

10

Mohan Meakins

Gold Coin

Apple Juice

11

Nafeed

Nafed

Apple, Mango, Pineapple, Orange

12

Modern Food

Rasika

Mango, Guava

Chapter – 2

MARKET ANALYSIS

The packaged Juices are getting recognized as social drink with dominant. Consumption being observed in the company of family and friends. Now people have started to percieve fruit juices as anytime beverages. New generation like fruit juices because of their good nutritive value.

The result of research can be briefly put as follow :

Among the probed fruit beverages, the Tropicana juice brand has been rated the highest.

Orange Juice is most preferred fruit juice flavor in India, followed by apple, sweet Orange and mixed fruit.

Most the consumers buy these packed juice during travel abroad on holiday.

Other attributes of branded juices consumers include employment of domestic help ownership of assets and credit cards and health consciousness with 80% respondents going to aerobic classes.

New consumers are starting to perceive fruit juices at home.

MARKET SEGMENTATION

The real Juices are segmentation between real fruit juices and synthetic drinks.

The real fruit juices are based upon natural fruit pulp.

The synthetic drinks are synthetic products with fruit or other flavors.

Segmentation could also be on the basis of benefit provided to the consumer.

Nutrition Content

Thirst Quarreling

(a) The Nutrition Content: – It gives to the consumer so one market could be the health conscious segment.

(b) The Thirst Quarreling:- So the other segment could be those buying the drink or n nectar for satisfying the thirst.

Another why brood segmentation can be on the type of situation in which the drink is used

People who are on the more e.g outdoor also

People who are using it on breakfast table as the part of their menu.

MARKET NEED:-

Consumers usually buy those products which are good in taste. Because if the taste is good, the consumer will buy it more. So, the companies working to bring a new food product to the market have two question- does it taste good and will consumer buy it ?

MARKET TREND:-

Tropicana fruits and flavor dominate the market, yet some consumers are still hesitant to try Len brown erotic flavor of carmbole. Companies are trying to mix these exotic flavor with familiar flavors. Fortified drinks are also gaining market i.e. the juice is processed and an additional nutrition trait is added to enhanced to its whole some value e.g with additional vitamin C, Calcium etc.

Now mostly population in cities are becoming more and more aware with regard to the nutritional aspects of life. This knowledge coupled with the consumer desire for a health their life style has greatly impacted the evolution of juices and juice based drinks one the few years.

MAIN COMPETITIONS :-

The fruit juices companies have to face the competition.

Soft Drinks :- both carbonated and non carbonated soft drinks.

Flavor Milk:- The nutritive value of flavored milk also good. The companies are trying to project it as a fun drink with added flavors and innovative packaging.

Mineral Water:- The main assumption is that packs ensure quality delivery.

Other Products:- e.g buttermilk and lassi these products are easily available and law in price.

Chapter – 3

SWOT ANALYSIS OF KIWI FRUIT JUICE

Now here I would like to discuss about one particular product of fruit juice industry that is Kiwi Fruit Juice.

The nutritive value of Kiwi fruit juice is very good. It is rich in vitamin, flavnoids and minerals.

It is mixture of 20% pure kiwi juice, matuared cane sugar. It comes in the packing of 250ml PET bottle, in tetrepack and kiwi fruit juice in 5 litre HDFE tub.

SWOT ANALYSIS OF KIWI FRUIT JUICE

STRENGTH :

If comes in innovate flavors. Which bound to get attention with proper communication.

It contain Vitamin C

Commuted, Capable and ambitious management

Flexibility in operations as initially they will be confirmed to few cities so can focus their efforts on the tastes.

It a antioxidant product.

WEAKNESS :

The distribution set up initially will be weak when compared with other market.

Kiwi as a fruit is new in the market and people are not aware much about this product.

This product is not available in India so it is very difficult for company to lower its prices.

There is only one flavor if Kiwi fruit juices.

OPPORTUITY :

More and more people are now health conscious and making fruit juice as part of their daily diet.

The market has a presence of only few players and they are not too aggressive.

Now the government also encourage the food processing Industry.

Now it is cultivated in India which cut down the cost of import of fruit.

THREATS :

Kiwi has two types of competition with in the Industry and other substitutes e.g. soft drinking Milk drinks etc.

Indian market has features of serving a wide variety people which is a challenge for all marketers.

Every competitor are doing promotional activities for there product.

The competitors have strong brand image in the market because of their business and their presence in the market from an early stage.

Chapter – 4

TROPICANA

The BCG matrix is well known portfolio management tool used in product life cycle.

The BCG matrix is that the best strategy is to dominate market share when the market is nature.

Profitability is high when the market is nature.

The dominating market share gives the highest accumulating production volume.

Low production costs can either be used to lower prices and take market share or to increase the profit margin.

BCG matrix is product mix. It is helpful to the managers to make decision about what priorities to assign to not only product but also company department and business unit.

Figure) The Boston Matrix

BCG matrix relies on 2 dimensions: Market growth and market share. Higher the market shares of specific product, faster the product’s market ability to grow. The BCG matrix divided into four contagious. It includes stars, cast cows, dogs and question marks.

Stars are the products which have high market share and market growths.

Cash cows which are considered to have low growth with high market share.

Dogs have low market growth and share. It is noticed that company should avoid or reduce the number of dog’s products in the industry.

Question Marks: – Which is high growth with low market share. It is considered to be the worst cash features of all because high demand makes it to have low return due to low market share.

The Pepsi Co. is consisted of 5 major brands Gatorade, Quaker, Pepsi Products, Fruit-Lay and Tropicana. It shows that products belongs to question marks are Gatorade and Tropicana. Because of the emergence of different healthy drink and beverages in the market. The market share of Tropicana and Gatorade are being threatened. Because then brands have already established in the market place, the company still need to lane an effective marketing approach to in increase the sale of these brands question mark category means that these products have a low market end may become a star product because of the positive response of the customer.

STAR CATEGORY:- These are the Pepsi Brands. The star category shows the product with a high share of a gradual growth of market and these products have tendesey to provide high amount of profits.

CASH COWS :- Quakers falls in the category of cash cows. In this category competitive advantage has been achieved cash cows have high profit margins and generate a lot of cash flow. Moreover because of low growth, promotion and placement investments are low cash cows are the products that businesses shine for.

DOGS CATEGORY :- Tropicana, Gatorade and Frito lays are products that can be considered in the dogs category.

Hence Pepsi Co. has been able to market their products and increase their market share and market growth by using different strategies and approaches.

Chapter – 5

PORTER’S FIVE FORCES MODEL OF FRUIT JUICE INDUSTRY

COMPETITION BETWEEN EXISTING COMPETITORS: – Fruit Juice beverage industry has been entered a phase of lapid development. The consumers are more education and health conscious. The product has been recognized by the public. At present, the fruit juices market, there are more competent competitors, the variety of products in various segments both leader, but lack of a strong brand. Large enterprises are faced with the plight of lower profits while SME’s in the capital, channel, product and other areas subject to significant competitive pressure, coupled with the impact of a price war.

THE THREAT OF NEW ENTRANTS :- I believe that fruit juice industry, the threat of new entrants in the following areas :-

Economics of Scale :- In general the economics of scale barriers the entry form or new entrants brined the risk of existing enterprises a strong counter-attack in order to enter the large scale of production. Fruit Juice industry, production lines, excellent processing technology which higher productivity, lower production costs.

Industry Counter-Existing Enterprises :- Juice huge market potential, attracting an increasing number of new entrants the market leader in the use of existing resources to counter the strengths, such as control of raw material, increasing the cost of new entrants control terminal sales of the competitors blockade, increasing the cost of sales and other rivals to form barriers to entry.

3. The Threat of Substitutes:- Fruit Juice industry is not a substitute for other types of beverages, drinks, face an auditioned nine categories of impact. It the lower prices of substitutes it will make the price of fruit juice drinks only at the lower hand, which limits the juice benefits. Prices of alternative products are more attractive, limiting the role of the greater of the composition of fruit juice drinks market, the more pressure there. This will increase the competition in the industry.

4. The bargaining Power of Buyers:-

(a) Sales: – In the first line cities, dealers are make access to information and product differentiation is small. Therefore the bargaining power of distributors is relatively large. In second tier cities, companies mainly rely on distributors to get the market, the dealers profit and less active, resulting in their bargaining ability.

(b) Retail Terminal :- For example Wal- Mart, Hyper Markets, it paying costs, slotting allowance and so high, PET bottles for fruit juice drinks on the shelf very strict selection, mostly of choice is a considerable brand of fruit juice drinks, such stores but also according to their own interests to participate in the development of the retail price of the product. As for the medium and small stores, small shops and so on, is very sensitive to price, substitute products and more bargaining power is also strong. 

5. Suppliers bargaining power. Threats to the major suppliers to increase supply prices or reduce the supply of products and services quality. From the raw material supply point of view, China’s fruit is rich in resources, and many juice drinks companies has its own production base, suppliers, bargaining power is not strong. However, as China’s low-cost, high-quality, highly competitive juices to enter the international market, attracting a large number of domestic and foreign funds to the industry aggregate. On the one hand, over the years a lot of capital investment, so that our fruit juice concentrate excess capacity, inadequate supply of raw materials led to price rise in production costs. On the other hand, the profit reduction also requested enterprises to reduce production costs, while cost reduction is the most effective way to reduce the price of raw materials, drive down the purchase price will lead to the interests of farmers has been damaged severely damaged fruit juice production factors of production enterprises, leading to competition in the industry gradual loss of benefits. In addition, the PET bottles used for packaging with a unit value of small, light weight, bulky, manufacturers focused on the use of features, making their transport costs are higher, once led to PET suppliers bargaining ability. In response, many companies adopt measures such as PP bottles, aseptic cold filling and other alternatives to reduce packaging costs. Juice beverage packaging business to strictly control the cost of making beverage packaging by the upstream industry (raw material), with competition in the industry as well as downstream enterprises (customers), three levels of the profit squeeze, beverage packaging industry profit margins are low. Of their weaker bargaining power. 

Chapter – 6

PESTLE ANALYSIS OF FRUIT JUICE INDUSTRY

There are main five different factors such as Political factors, economics factors and social culture factors; Technological factors legal factors and Ecological factors.

Political Factors :- Various Political factor offal the fruit industry e.g. Taxation. Because the taxation policy keeps changing. The government plans to encourage foreign direct investments would our Industry highly as organized fruit juice industry has only 3% share as of now in the market but with FDI’s it could increase significant by coming of bigger players.

Economic Factors:- The company is using truck to more raw material to the processing plant and finishing goods, so fuel is very important high risk due to crop facture, non availability of raw material because of pest attack ect.

Other Factors affecting the fruit juice industry are real growth, inflation, interests rates, government action and other factors.

Factors Like Money Supply, energy availability and cost, business cycle etc would also effect the Industry.

Technological Factors:- Technology plays very important role in maintaining the quality and cost efficiency to generate higher profit. Better Technology increases the life of the product.

Social Culture Factors: – As the income of middle class increases, new consumers are more conscious about health. The life is becoming more hectic and tiring, consumer’s preferences are shifting to healthy drinks. The young generation is also shifted from coke to fresh and healthy drinks. As the people become more educated, they are taking the healthy router.

Legal Factors :- processes fruit juice are regulated inde the food and drugs and regulations as a food product and the consumer safety requirements become more advanced across the beverage industry, tracking and traceability are a prerequisite.

DEMAND FOR FRUIT FRUIT JUICES IN INDIA

PAST & FUTURE

YEAR

RS. BILLION

1995-96

1.62

2000-01

2.48

2001-02

3.55

2002-03

3.95

2003-04

4.35

2004-05

4.80

2005-06

5.30

02006-07

5.80

2007-08

6.30

2008-09

6.85

2009-10

7.40

2014-2015

10.90

CONCLUSION

This table shows the demand of fruit juices has increases every year. The demand for fruit juices in the fiscal year 2008-09 was Rs. 6.85 billion. It is expected to be Rs. 10.9 billion in the fiscal year 2014-15