Yang's group discuss-Marketing-Cott

Company Introduce:
Overview:
"Cott is the world’s largest retailer brand beverage company. With approximately 4,000 employees, Cott operates soft drink, juice, water and other beverage bottling facilities in the United States, Canada, the United Kingdom and Mexico. Cott sells beverage concentrates in over 50 countries around the world.
Cott supplies more than 200 retailer and licensed brands of beverages in 20 manufacturing facilities. Its partner with the world's leading grocery and mass merchandise retailers to build their private label programs with high-quality carbonated soft drinks, juices, smoothies, sparkling and flavored waters, energy drinks, sports drinks, juices, ready-to-drink teas and other non-carbonated beverages."

Its vision:
Cott believe that success is achieved by maintaining a disciplined focus on just a few critical things. To help its further strengthen our category leadership position in private label beverages and earn our customers’ trust as their preferred private label beverage supplier, cott concentrate on its simple “Four Cs” framework of:
Customers
Cost
Capex
Cash flow

Cott Priorities:
Low Cost Producer – Always look for opportunities to control the “Four Cs”
Customer Focused – Focus on providing exceptional customer service to our internal and external customers
Drive Innovation – Drive new ideas, improvements and focus on finding solutions
Win As A Team – Support and work well with others. Take ownership for team results.

Quality Assurance
Cott’s reputation as being best in the industry for private label beverage manufacturing means exceeding superior standards every step of the way and selecting the finest ingredients for specialized beverages such as functional waters and juices, organics and kosher

Product Development
Developing the right beverage for a customer may involve key elements such as customized taste for a specific market, or address a new trend in the market at a reasonable product price. Cott’s Product and Innovation team is passionate in meeting the expectations of our customers






Products:
best in class soft drinks

Energy Drink:
Private label energy drinks and shots are on the rise! Our formulas provide delicious tastes, great results and consumer satisfaction. Zero calorie options available.

Waters:
our capabilities run deep. Natural and Organic flavors available in various sizes and case packs. Bring the best in private label water resources to your shelves.



Single juice:
The best options in 100% single juice and juice blends to juice cocktails, juice drinks, fruit and vegetable blends, splashes and juice smoothies…we’ve plenty pouring just for you! Looking to feature naturals, organics, vitamins, omega, or energy characteristics in juice? Ask us about our innovative properties in this category!

Mixers:
For the best tasting tonics, club soda, seltzers and mocktails, Cott offers dominant brands consumers ask for by name in fabulous flavors and calorie options. We’ve got what your consumers want to mix with.

Ready To Drink Teas:
It’s always tea time at Cott! Selecting only premium teas, our varieties include Green, Black, Red, White, Earl Gray and Oolong! Available with tempting fruit flavors, refreshing mints, and many more varieties, we have what’s hot in real brewed ready to drink tea and cold filled too! Ask us about our natural, organic, and zero calorie options

Sports Drinks
For on the go, on the job, or after a workout, we provide the best in class sports drinks your consumers demand most! Fantastic flavors, regular, low calorie and zero calorie options deliver fast hydration required for today’s lifestyles.

Country Analysis
Trade and economic situation
Fact
Indonesia is the largest economy in the South East Asia. The 2008 crisis, which causes global economic recession, had slight effect on Indonesia compared to its neighbours because its economy relies on most of its domestic consumption. Its GDP growth is 6% in 2008, 4.6% in 2009 and 6.1% in 2010; it total imports reached $119.6 million in 2009 and $158.2 billion in 2010. In general, its Exports met $89.5 million in 2009 and $127.1 million in 2010. These evidences offer an economic signal to display their trade and economic trend is more open and stable now than before and the increasing purchasing power of Indonesia.
https://www.cia.gov/library/publications/the-world-factbook/geos/id.html

2008 2009 2010
GDP-per capita $3900 $4000 $4200
GDP-real grown rate 6% 4.6% 6.1%
GDP-purchasing power parity $928.2 billion $970.6 billion $1.03 trillion
GNI-per capita 959.30 991.62 1033.91
Total Exports $119.6 billion $158.2 billion
Total Imports $89.5 billion $127.1 billion

Implication for your product’s marketing strategy
Indonesia is a Lower-middle-income economy according to the class of Gross national Income- per capita, which is definition by the World Bank; it also means the developing economy, which has a wild space in new market. In this status, the price of our products has to match against local products if we have the similar products. However, low price is not the proper strategy to occupy the market. Our companies need to build the great reputation and brand to separate the market for our products and sold price. Big cities are our target market to promote our products because people in cities have more accesses to get information and also have rest of money to buy our products as well as the channel in cities is more convenient to transport our products.
Political situation
Facts
The past political history is unstable in Indonesia. But, they have reformed their political system to become a mature multi-party democracy in recent year. In Indonesia, the president term is 5 years, and its first direct presidential election was held in 2004. Susilo Bambang Yudhoyono is the first president to be elected in 2004 and re-elected with 60% vote in 2009. These successful elections were mainly due to the high expectations on wide ranging economic reforms and anti-corruption programs he championed during his first term. Moreover, the military effect is minor to their political system. The political trend seems to go toward more stable in public system under democracy system.
http://www.edc.ca/english/docs/gindonesia_e.pdf

Implication for your product’s marketing strategy
Under the stable public system, direct investment in Indonesia is an access to take advantage in low cost of local labour and nature resources, and also promotes our company to get a great reputation. Direct investment can bring technology, capital, talent and work opportunities to improve the economy. Moreover, local employees in our company know our products are reliable to trust, and the reputation will be diffused. Although the first enter to the unknown market is a higher risk, it is also take a best opportunity to make the great profit and standing under the brand-made.

Legal/regulatory situation
Facts
Indonesia’s legal system is civil law system based on the Roman-Dutch model and influenced by customary law, and its judicial branch is assembled by Supreme Court, Constitutional Court, Labour Court and the Anti-Corruption Court. However, their judgement from court system is not highly trust to be a legal decision. They have the shortage of clean and skilled judgement in Court. It is quite common to make a payment for judgement and the court system is like a language of law. Although current president declared the anti-corruption progresses in 2004, this country’s execution of trust court system is still a lot of work.

http://okusi.net/garydean/works/bizindo.html

Implication for your product’s marketing strategy

The legal system is not reliable, but our company can reduce the risk from the relationship with particular people, who are familiar with these works or a joint-venture with local to avoid the direct conflict. In general, it is not common to have a conflict for international companies when the regulation is not violated. But, building a close relationship with local is necessary to protect the profit of our company and also further predict the future risk.

Social and cultural forces
Facts
Society in Indonesia is collectivism and also has wild range class from extreme high to the lowest, and everyone knows their position to have their relative reactions. It is difficult to break down the rule of hierarchy to treat everyone the same distance. Age is also an important role in society. People over 40 look like a mature to have trustful decision and younger should respect older in language and behaviour. Education is another reason to observe people’s social class. In common way, people who have higher education mean better career and higher social class. Most people in Indonesia is natural friendly and polite in their behaviour, and their communication is indirectly and formality. Building the relationship with them mainly depends on personal communication in a way.
http://okusi.net/garydean/works/bizindo.html

Implication for your product’s marketing strategy
Collectivism means the group trend. In a group, leaders always have effect to other people, and most of people will trust leaders’ decisions and follow their behaviours. Our company can make different target market for different groups as long as we find out the leaders for different groups. Then, our products can be advertised by these leaders such as a mature doctor or teacher, which they have a reliable reputation, and the brands of our products will be improved.




The situation with respect to other environmental variables
Facts
Indonesia is wildly affected by climate change, which contains rising sea levels, erosion of coastal areas and increased extreme weather, and it also the third-top of countries to contribute gas emission. They are trying to protect their environment but lack of technology. In 2004, President Yudhoyoso set up a multi-agency to reduce the illegal logging. In 2006, U.S.A President, Groge bush and Indonesia President announced MOU(of Understanding on Combating Illegal Logging and Associated Trade) to sustainable forest management, improved law enforcement for avoiding deforestation. In 2009, President Yudhoyono pledged to reduce up 41% of green house gas emission and eliminate fossil fuel subsidies by 2020. All these efforts is to reduce the effect from global climate change.

http://www.state.gov/r/pa/ei/bgn/2748.htm

Implication for your product’s marketing strategy
Green technology is a major key for our products. To protect this environment, using the advanced technology of water recycle system can reduce our cost of wasted water and promote our products as a green production. In general, our packagings of our products need to adopt the environmental regulations to recycle the used products and protect the inner goods. The products is produced to sell under the advanced green technology; the great opportunities is coming to improve our brand for our products.

This is howard's job and we need help him decide the red colour question. Tell me your think before 12:30 pm at oct 14th.
2. Market Structure and Competitive Analysis
i) description of the market - size and growth

Indonesia have a populations of 237.6 million people and a soft drinks market valued at $5 billion USD in 2010. Over the past 2 years, the food and drink industry has grown 1.26% and is still growing. Due to the population growth and better economic outlook, the country has attracted significant foreign investment in recent years and is expected to see good macroeconomic growth in the coming years. Expected rising disposable incomes and standards of living are likely to result in increased consumption of commercially packaged drinks. With improved levels of disposable income, consumers are placing a higher priority on health and wellness in order to enjoy their improved lifestyle, thus will affect their choice of soft drinks.

Certain soft drink products with functional health benefits enjoyed higher interest and manufacturers are taking advantage of the development with a strong emphasis on health and wellness in marketing and promotional activities.

As the population continues to grow and better economic outlook, soft drinks is expected to record positive value growth over the forecast period. New product developments and investment in marketing and promotion is expected to pick up after some uncertainty caused by the global economic downturn. Functional health benefits are expected to be the key messages communicated by manufacturers in response to the growing health and wellness trend. Young adults, teenagers, and children are expected to be a crucial audience as manufacturers look to secure the present and future potential for soft drinks.

b) implications for your product’s marketing strategy
(Yang, please add our product marketing strategy here)


ii) factors affecting size and growth of the market
Indonesian consumers are easily influenced by marketing and promotional strategies. Increasing health concerns primarily affected carbonated drinks are perceived unhealthy while fortified soft drinks, green tea and fruit/vegetable juice are perceived as health.

Prolonged rainy season or weather conditions where rain continually falls on supposedly summer season will hamper the potential growth of some soft drinks that rely on hot summer days for higher sales and market shares.

Due to Indonesia’s underdeveloped retail infrastructure in which independent small grocers account for over 36% of volume sales and supermarkets/hypermarkets commanding 17% of the sales, expanding distribution network through these channels will be vital to capture key market share and increasing sales volume.

In addition, unpredictable natural disasters can also bring uncertainty to the country.

b) implications for your product’s marketing strategy
(Yang, please add our product marketing strategy here)



iii) description of major competitors - market share and growth, source of competitive advantages and disadvantages, future prospects
Sinar Sosro PT is the leading soft drinks competitor in the market, with Multinationals Coca-Cola Indonesia and Danone Aqua ranked second and third.
Their competitive advantages include aggressive marketing and promotional activities and successful new product developments. Since they are well established brands, they have also managed to retain consumer trust and Danone Aqua have brand loyalty due to its dominating presence within bottled water; the leading contributor towards volume sales of soft drinks.
Their weaknesses include not establishing brand loyalty within the younger generation audience (Young adults, teens, and children), and due to their enormous size as a company, their chain of command is often long which make them cumbersome to act swiftly upon new threats and marketing strategies that are used against them.
b) implications for your product’s marketing strategy
(Yang, please add our product marketing strategy here)

Pleas read all members job and give idea of yourself. I will fix it before class. Thanks!

b. Progressive Report 2: Parts B3, C and D: At the beginning of class, Nov 18 2011 ; 5 marks
Group members should overview all questions this week and then give me your answers. We will discuss on next week.