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The Marketing Practice From Islamic Perspective Marketing Essay

3558 words (14 pages) Essay in Marketing

5/12/16 Marketing Reference this

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Introduction

The purpose of this assignment is to analyze and study the marketing case in Malaysia, particularly, a Malaysian company must be chosen and our choice of company is Mamee Double Decker (M) Berhad. Various aspects of study under the subject matter have been considered. This includes the target market analysis, marketing mix consideration which consists of product, pricing, promotion and distribution decision. In order to analyze the internal and external problems facing the company, we have done a SWOT analysis (strength, weakness, opportunity and threat).This is to highlight and raise several problems or issues facing the company locally or internationally. Market research on comsumer behavior and competition has also been carried out through a survey questionnaires and the summary or report of the summary have also been done.

Mamee Double Decker Went Global

Background of the company

The company chosen for this case analysis is Mamee Double-Decker Malaysia Berhad. Mamee was founded in 1971 by Datuk Pan Ching Hin and headquartered in Malacca. Mamee Double Decker is Malaysia food processing, snack and diary product company. It mainly produces and sells instant noodles, snack, confectionery and beverages. Mamee Double Decker not only sells its product locally but had penetrated the international market as well. Today Mamee products are exported all around the world to more than 80 countries and area it serves includes Asia, Middle East, Africa, America, Europe and Oceania. Products produce by mamee are popular and well known to most households especially children.

Marketing practice from Islamic perspective

When mamee first came into existence, its products were only mamee monster noodle snack and double decker snack. Mamee later had gain recognition from several countries because of its distinct and unique feature of the snack that is square-ish noodle like and the adorable face of monster on its packaging while the double-decker snack , is a flavored snack with a choice of prawns chicken and cheese.

The company then goes through a major diversification when it produces carbonated drinks under the brand cheers. Mamee instant noodles later was produced. However, different instant noodles are provided to cater different countries, For example mamee bihun, express noodles, and mi goreng are only available in Malaysia as it suits the malaysian taste, while these products are not made for the overseas market. The company has produce mamee oriental noodles for outside market.

Marketing Mix Consideration

Decision made by the company regarding to the price, promotion and distribution are the elements of marketing mix consideration that is being use in making a decision.

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Product decision

Initially, mamee mainly focus in producing snacks, but it had diversify its products in producing beverages such as soft drinks, cultured drinks and recently the new products by mamee, a juice under the brand ‘Rio Fiesta” a healthier options for drinks produced by mamee. All product produced by mamee comply to the standards required. The company had obtained Hazzard Analysis and Crtical Control Poiint (HACCP) certificate. The obtainment of this certificate means that mamee had adhered to food safety from raw material production, procurement and handling, manufacturing, distribution and the consumption of the finished product. From Islamic point of view, mamee had free from gharar or uncertainty by providing adequate products description and specification for all its products. This includes complete labeling and nutritious information, ingredients used and its expiry date.

At the same time, other products evolve in the market under mamee double decker is nutrigen, is a cultured drink for children. Mister Potato was out of the market later after that, now, Mister Potato had officially become the global snack partner with Manchester United. Latest product by Mamee double decker is corntoz, corntoz is a crunchy snack came with different flavours and shapes.

The main concern under this food processing, beverages and diary product industry is about whether the product are halal (permitted). Since this company mainly sells their products in Malaysia and in other Muslim countries, therefore mamee double decker products must be certified halal. As reported in “Malaysia Halal Directory”, Mamee Double Decker had obtained the halal certificate for all of their products. Their products are free from additives made from animal sources that are forbidden in Islamic Law. Stabilizers, Emulsion and colouring used in their production process are deemed as halal.

Promotional Activities

Mamee Double Decker, like many other companies in this competitive environment are driven to adapt an aggressive promotional strategies in order to gain market share. Mamee Double Decker had use various promotional tools including advertising and sales promotion to capture the market. As reported in The Star newspaper July 17 2002, RM 40 million was allocated solely for promotional activities in Malaysia. On the same year, Mamee had made an aggressive advertising in Myanmar and china to create brand awareness to familiarize their products in these markets. Recently, Mamee had become an official snack partner with Manchaster United. This joint-venture is important as it aims to boost its market share in Asia. One of the interesting activities that has been carried out through this partnership was ” The Ultimate Manchester United Experience” contest. Lucky winners had been treated to a trip to Manchester united to meet their favorite football players.

Mamee had also use Malaysia local celebrities, such as Mawi, Felix and Amalyea as ambassadors for mamee sllrpp products in Malaysia. In the recent festive season Hari Raya, Malaysia celebrity Shahizi Sam was featured in mamee sllrrp advertisement and they had conduct a “Mamee Kusayang Contest”. This shows that Mamee Double Decker had made several aggressive promotion activities throughout the years. Its promotional activities adhered to the basic Islamic principle of business and Mamee had ensure its product reach the target market in all around the world. Any promotional activities to stimulate the demand from consumers are permissible as long as it does not exaggerating or breaching the Islamic principle. Activities like free samples, cash rebates, joint promotion and contest conducted by Mamee are therefore deemed permissible.

Pricing Decission

Pricing of mamee product are reasonable and affordable for the interest of all. This pricing strategy enables it to capture the market share of various market segments. For example in Malaysia, mamee monster snack only cost 30cents and mamee Double decker snack cost only RM2.50. Mamee had made no price discrimination for all of its product. The company Charge same price for same good in respective countries, irrespective of different markets. Therefore Mamee pricing strategy is considered fair(Adil) and just.

Distribution

The distribution channels of mamee food and beverages in Malaysia consist of three stages (producer,retailer,consumer). Mamee which is the producer will sell its products in bulks to retailers (Giants, Tesco,etc) , and eventually retailers will sell it to the consumers. In international level, the distribution are being done through appointed subsidiaries.

Mamee has favourable access to distribution networks in Malaysia. Mamee Double Decker has 13 distribution centers and has about 150 transport carrier for deliveries to about 1000 point of sales. Mamee Double Decker currently has five manufacturing facilities in Malaysia and one in Myanmar. Mamee Double Decker has centralized marketing and distribution system while Mamee have assigned an export manager in each manufacturing subsidiary. . There are three companies under Mamee Double Decker responsible in producing each of their respective lines and products for example snack food and chilled products (KMM), instant noodles (PP) and beverages (MDDB).

Target Market Analysis

Mamee Double Decker (M) Berhad is good in quality and unique brand which targeted to all group of people according to the product offered. As the company began with a single product and consistently grown to 50 products, targeted people become more. The household products brands like Mamee Monster, Mamee Instant and Mamee sllrrp, and Mamee snacks, are targeted to people whose age is from 6 to 30 years old. Targeted group in this range of age includes, children, teenage, students, working class, and family. This is because not all of its products are targeted to the same group of people.

Products like Mamee monster, nutrigen, Double Decker are an examples of products that targets mostly childrens. In Australia, mamee monster snacks is sold in their school canteen. This shows that these products mainly attract children. Nutrigen is a cultured flavored drink that is targeted kids from age 6-12 years old.

The second group is students. Mainly, products of Mamee that attracts students are instant noodle like Mamee slrrpp, snacks like double decker, mister potato and jacker. This is because, most students who normally live outside or far from their home need something instant or something to munch in between their meals. This will also eliminate the need to cook or having to buy foods outside. Moreover, snacks like Mamee monster and Double Decker are the loyal companions for students as well especially in times of stress while studying.

Teenage like students needs snack during their leisure time. From the family structure perspective, a mother with at least 5 children, usually will buy more groceries and household products. Children love to have snacks like Potato Chips, Potato Crisps and Cheer Beverage because the products are very convenient and it comes with different flavor based on their preferences. Furthermore, families who spend their spare time with picnic and party usually find Mamee products a reasonable choice.

In term of target market demographically, though Mamee actually target low to middle income earners, high income earners are attracted to it as well because of its affordable and reasonable price.

It is very clear that the size of the company’s target market is very large and high. Everyone may be used and consume the product offered because it comes with varieties of food, snacks, beverages, instant noodles and to name a few.

SWOT analysis

Strength

One of the strength pose by Mamee Double Decker (M) Berhad is as reported in recent mamee double decker (M) Berhad annual report, the company had experienced 57.3% growth of profit before tax from 9.6 million. Mamee Double Decker(M) Berhad strength also lies in its ability to expand their business network by penetrating into new exports market. This is proved to be true as mamee experienced a growth of 6.2% in 2002 in its effort to venture to new exports market.

The second strength of mamee is it has a good reputation among customers, since has become part of the choice made by household largely in Malaysia, mamee so far had not fail to impress its consumers all over the world by providing a tip-top service from the process of production to distribution, we can see that mamee products reach consumer easily as it is easily available in store from a small grocery store to large super markets.

The third strength of mamee double decker is we can say that it has a quite strong brand name as according to their annual report, mamee had won several awards locally and internationally. The two local awards that mamee has honoured to receive are first, the chief minister awards for “Promising local Company Awards ” in recognition of Mamee Double Decker Berhad (M) to local industries and the second award is by Malaysian Manufacturer packaging Council of Malaysia, given to one of Mamee Double Decker (M) Berhad product, that is Nutrigen Liteyo. Internationally, mamee had also been rewarded internationally recognized ISO 9002 togethe riwth China Awards Certificates.

Weakness

This includes the internal and external problem of Mamee Double Decker (M) berhad. The external problem pose by this company is as reported in the star newspapers 2007, mamee has not yet succeed in gaining a market share in China as there is a negative growth in Mamee double decker operation in China particularly,Mamee Double-Decker Food(Suzhou)Co. Ltd, demand for Mamee in China is low, thus generating low sales and revenue and consequently the company had incurred higher loss. however the company did not loose hope and have confidence in its China operation and Mmaee had appointed a consultant to resolve this issue.

The second external problem face by Mamee is high dependency of raw material from Europe as such when there is a rise in Euro against USD the mamee double-decker earnings is affected since some of mamee products ingredients such as Mister potatao crips are imported from Europe, ,thus when the price of raw material increases, this gives pressure to its profit margin. In order to overcome this problem, mamee needs to do more reaseach and development to reduce its dependency from outside.

One internal problem in mamee double decker lies in its small number of manufacturing facilities, considering that mamee products are marketed all over the world, with only five manufacturing facilities , limited production can be made per day. If mamee want to extend its product line, it will be restricted as there is a limited space for production.

Opportunity

Since now consumer are becoming more health conscious, one opportunity for Mamee Double Decker is to come up with a product that is more healthy as it will give customer a more options for healthy good food. Mamee Double Decker plans to obtain health food supplier in an effort to expand its product line. Mamee had identified several suppliers and the company plans to negotiates with this suppliers in providing good supplies of food

Threat

As customer becoming more educated and conscious about the food they consume, consumer tends to compare prices and quality of products with other brands. Currently in market there are various brands and product they offered similar to Mamee Double Decker. Thus, the threat of Mamee Double Decker is the competitors in market like for example, Munchys, Nestle, Unilever Foods.

Mamee do not only pose an internal threat, but also external threat for example in terms of competitors in China is also obvious. Mamee face a greater threat especially in Shanghai, this is due to the complexity of market in China in addition to variety of snack food products produced by them. In Shanghai, mamee had to face competitors that have a greater market share like.

Report on Consumer Behaviour for Mamee Double Decker

In order to evaluate the consumers’ preferences on Mamee Double-Decker products, a survey has been conducted within a population of 100 respondents and 30 out 100 were taken as a sample to this research. There were 17 male and 15 female involved in this sample. A set of 22 questions were asked during the survey session which majority of the respondents came from different background and the survey were conducted online. Before the surveys were taken in place, a short description of the company was given so that the respondents somehow know what they would be expecting during the session.

Questions were separated into three parts started with the personal background information then likert scale questions which evaluate their decision making in making purchases and the last part of the questionnaire cover their own given answer accordingly.

Result follow suits right after the research conducted was done. Majority of the respondents were Malays which covers 91percent of the total sample taken. This is explained by the major ethnic in Malaysia is Malay followed by Chinese with 6percent and others 3percent. As for income level, most of the respondents categorized as middle class earners because their income level is range between RM1001 to RM3000 with 47percent are in this group while the remaining 44percent belongs to lower income earner like students and jobless teenagers.

Within this sample, most of the respondents are in their bachelor degree staying in urban area and living single life which eventually led them to such consumption with the ration of 63:84:97 for all categories. 84percent of these respondents also admit that they enjoyed eating snack food and beverages with a typical consumption of 1 to 2 packs a day. Why this happening is because during the earlier age like teenagers in university, they are prone to having a quick and light food as on the go. This somehow explained the viability of the result.

When it comes to factors to decision making questions, the result was significantly expected. Almost all the respondents agreed that they are very cautious in choosing their favourite snack foods and beverages because this factor has to do with their taste buds. While pricing became the second factor that influenced the decision making; 35percent agreed that price do play a vital role in their purchasing power.

Morever, 55percent of the respondents were also somewhat agreed that Mamee Double-Decker do became their preferred brand and offer wide range of products under one roof with their given competitive pricing on the products compared to other brands. So most likely consumers can easily make decision in making purchases and less confusion.

Unfortunately, Mamee Double-Decker wasn’t still at the par in offering good taste for their products because only 47percent out of the total respondents were somewhat agree with the company’s taste performance but the remaining disagree with it. However, 41percent of the respondents agreed that Mamee products are reachable in the market which eases them in making purchases.

Majority of the respondents bought Mister Potatoes and Mamee Monster snack which are two of the most popular snack foods from Mamee Double-Decker and they usually bought it at convenience stores like 7-eleven and hypermarkets like Tesco. As for substitution for Mamee brand, they usually go for Jack n Jill brand and Nestle which are two of the top snack foods and beverages producers in the world. Thus this is threat for Mamee Double-Decker because of the stiff competition from these giant producers. Mamee Double-Decker should improve their products taste and perhaps packaging in order to stay competitive in the market despite having cheaper price strategy.

In a nutshell, Mamee Double-Decker is a proud home-grown snack foods and beverages producer that went global. However, Mamee Double-Decker cannot be relied truly on domestic markets with their currents products either domestic market or international market, instead they should keep doing product development program in order to come out with new line of foods and beverages that suits the preference of the consumers worldwide.

Report on Competition for Mamee Double Decker

A survey has been conducted in order to evaluate the competition for Mamee Double-Decker products. Mamee-Double Decker (M) Bhd, which has made a name for itself with its snacks and confectionery products. A survey with a population of 50 was targeted and a sample of 30 was chosen for this research. Respondent consiste of 16 males and 14 females.The survey was a close ended survey requiring customers to answer a multiple chouce question with a 5 asnwer options. A set of 15 questions have been asked regarding their brand preferences. Mamee Double Decker have various competitors on market for example, Munchys, Nestle, Unilver Food. Under this company they too had offered various consumer or food products for example, maggi, a brand for instant noodle.Mamee to had rival branding for their beverages particularly cultured drink, for example, nutrigen cultured drink are competing against other various brands like yakult, vitagen and solivite.

In a brief summary, 40% of respondents are quite loyal and repeat buyer for mamee products while 60% of them are somewhat in a middle as they also have other preferences and branding in buying consumer goods products. Based on the survey conducted, consumer prefers brand yakult and vitagen more compared to nutrigen which come from Mamee products. This is believe due to the reason that yakult are better in terms of quality as they contain probiotics .

On the other hand their champion’s products like Mamee Monster, Mamee Noodles, Mister Potato, Double Decker and Nicolet Swiss Herb Candy are more preferred by consumers. In a survey, 65% od consumers prefer more of these products because of it tastes and the prices are affordable as compared to other products such as Pringles, Indo Mee, Maggi and etc. However, the remaining percentage of 35% do prefer other snacks brands like Pringles,Lays, Doritos as they may have perceive this brand are better in quality and tastier compared to mamee products. .

Conclusion

In conclusion, Mamee Double Decker is a company that have a potential to grow further and to compete aggressively with other products in the market. Since the company have established for quite a long time and has been consistently doing well, they have good prospects to progress in increasing its market share in foods and beverages industry in the future. Looking at its current marketing strategies and programs no doubt that this goal would be attainable. In our opinion, Mamee would not lose to its competitors in the market due to the fact that Mamee is constantly doing Research and Development (R&D) to improve its quality of product and extends its product line. However, considering the change in behavior and lifestyle of consumers, that are increasingly, becoming more health conscious mamee should come up with a new products line that suit the changing need of customers.

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