A Comprehensive Business Plan

Introducing a New Product (Celsius)


Academic Paper, 2018
44 Pages, Grade: A

Free online reading

Inhalt

1.0 Introduction
1.1 History
1.2 Frostbit
1.3 Company Vision, Mission & Values

2.0 Marketing Objectives
2.1 SMART
2.1.1 Specific
2.1.2 Measurable
2.1.3 Achievable/Attainable
2.1.4 Relevant/Realistic
2.1.5 Timely

3.0 SWOT Analysis
3.1 Internal Analysis
3.1.1 Strength
3.1.2 Weakness
3.2 External Analysis
3.2.1 Opportunity
3.2.2 Threats

4.0 Market Analysis
4.1 Demographic
4.2 Geographic
4.3 Behavioural
4.4 Psychographic
4.5 Market Needs
4.6 Market Trends
4.7 Market Growth

5.0 PESTEL Analysis
5.1 Political
5.1.1 Political Vulnerability
5.1.2 Government Executes
5.2 Economical
5.2.1 GDP Trends
5.2.2 Increased Inflation Rate
5.2.3 Fluctuating Interest Rate
5.3 Social Factors
5.3.1 Job Creation & Human Resources
5.3.2 Weak School Learning Outcome / High Literacy
5.4 Technological Factors
5.4.1 Access to the Internet
5.4.2 Lack of Infrastructure and Quality Power
5.5 Environmental
5.5.1 Environmental Concerns
5.6 Legal
5.6.1 Government Regulatory Policy & Law

6.0 Competition Analysis

7.0 Marketing Strategy
7.1 The IMC Mix
7.1.1 Advertisement

8.0 Target Marketing
8.1 Undifferentiated Marketing
8.2 Target Audience

9.0 Positioning

10.0 Marketing Mix
10.1 Product
10.2 Price
10.3 Promotion
10.4 Place

11.0 Marketing Research Secondary research

12.0 Capital
12.1 Financial Objective
12.2 Budget
12.2.1 Value Proposition Budgeting
12.2.2 Cost
12.3 Break Even Analysis
12.4 Sales Forecast
12.5 Expense Forecast
12.6 Marketing Expense Budget

References

1.0 Introduction

Load shedding (electricity outage) has become a part of everyday occurrence in a part of life of some people. It has become a common phenomenon in some parts of the world. The electricity outage has caused a lot of people problem as well as system loss. Load shedding means the short, fluctuating or measured supply of electricity to locations. Load shedding occurs when a country produces an amount of electricity which is lower than the usage or demand of the electricity within the regions. Electricity suppliers deliberately disconnect the supply of electricity to certain areas in order to keep the flow of electricity to other major areas. The regions which are affected by load shedding during the times of load shedding plunge into the dark ages. Not only some but many areas around the world experience this phenomenon. This problem has been going on since yearlong times but no permanent solution has come in order to resolve this issue.

Once a certain region has load shedding, all their electric power supplies have been stopped completely costing businesses and the general public a lot of problems. Problems escalate even more particularly in summer times. Load shedding usually happens during the day time as well as night time, but during the day times its costs more towards the public as they are not able to conduct their day to day business as well as not being able to go on with their house hold chores and even in some cases have problems in cooking. People in these regions sometimes have to be without electricity and essentials for up to 5 to 6 hours during the day. Elders, children’s, babies as well as old people have to go through this without any facilitation of even crossing the time in peace.

1.1 History

Looking at this delinquent practises, a group of four young generation student (Irfan, Noaman, Kiron and Gao) came together to facilitate the people around them who go through such difficult times. In the start of 2018, they came up with a company name Celsius which means Temperature. The four students wanted to facilitate those people affected so that they can at least have some peace in their life going through those tough times. As equipment’s are quite expensive, the quad squad came up with the idea to manufacture these aircons from recyclable products so that the costs are low and they are able to provide the product to as much as people possible.

Celsius limited was formed in Rajasthan, India in January 2018. The company has its headquarters in Jaipur, Rajasthan. The manufacturing factory was debated amongst the quad squad to either have their manufacturing in India itself or to start-up in china. After heavy discussions, they came to a conclusion to keep the costs low for the company and fulfil their dreams they would open their manufacturing factory in Rajasthan, India.

Rajasthan was chosen due to the special characteristics that place holds, as being one of the cheapest and having a wide variety of raw products and materials. As well as having quite a cheap labour rate, the location made perfect sense in order to reach their goals.

1.2 Frostbit 1

The company started its production in February 2018 with their first production of the portable handheld air conditioner with the name as Frostbit. The Frostbit 1 is made mostly out of recyclable products to have a better impact on the environment and stay green. The first product of the company hit the Indian market in March of 2018. Due to the cheap cost and the reliability of the product, the product became a huge success in those targeted areas. The product utilize the use of ice that assist in generating cold wind blown out of funnel due to powerful fan inside. Giving customer cold air to escape Indians heat.Within its few time period of being on the shelves, the company has already sold upwards a Million units and the market has been demanding more of these products throughout India. The cheap price, reliability and the convenience it provides has made the product a popular success.

1.3 Company Vision, Mission & Values

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2.0 Marketing Objectives

2.1 SMART

The SMART philosophy can be an effective way in the creation of the marketing plan which is used in the process to guide and measure the developments as well as the goals. Chakranarayan,2009). It has been derived from shortening Specific, Measurable, Achieveable/Attainable, Relevant/Realistic and Timely. Some of the purposes of SMART are;

1) To let the company to enable their control over the marketing plan.
2) In order reach a common goal, it helps to motivate the individuals
3) Provides a constant focus in an organisation for the functions which have been pre- agreed upon.

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The SMART helps Celsius to guide to goals setting. The criteria’s mentioned are attributed to Peter Drucker’s Management by Objectives concept. In which he stated that the in order to make sure that the goals of the firm is completely clear and can be reached, each of the firms should be SMART and due to this philosophy and intent to reach high grounds, Celsius chose this strategy.

2.1.1 Specific

The S in the Smart stands for Specific. This means that a firm should be completely clear of what the firm is striving to achieve. The specific gets the answers to questions which arise, such as;

- What is to be done in the firm?
- How will the firm know that it has achieved what they wanted?

In this part of the SMART criteria, it will also describe the end product or the results of what the firm wanted to have done. The goals should be clear and should have the required details so that anyone who reads those objectives will have the same understanding leading to better and good end results. As in the olden days, the objective to get more business is just not helpful anymore (. Chakranarayan,2009)

Celsius Inc. put up the specific and needed promotion and the advertising activities in order to achieve the “First season 1 Million” goal. The advertising activities include the advance TV advertisements (Making the customer aware about the Frostbit), a 5 day product release in Jaipur, Rajasthan, India and also have long term antiaircraft billboards advertising all around as well as have social media promotions.

2.1.2 Measurable

The M in SMART stands for Measurable. This means the firm at the time of setting objectives should also include the quantifiable, meaning that a quantitative or qualitative element be applied during the creation of the objectives. ( Agha. N, 2011). It defines the objectives using terms such as quantities, quality and frequency. The firms using quantity measurements use terms in amounts or percentages. Firms which use frequencies measure according to the daily, weekly or more time spans. The quality element is measured in terms of the description of the requirements in terms of accuracy and format within the outlines of the objectives.

If an objective is defined without the measureable element then it would be as if playing football and not keeping the score. This comes to show that numbers are vital in order to keep track of the progress.

The goal of the Celsius will clearly be recorded and measured. The main standard of this part is that number of sales. Celsius has invested in a tracking system record for every item which has be manufactured till the sold, which gives the company the ability to easily measure and monitor the records and work accordingly.

2.1.3 Achievable/Attainable

The targets which are set in the objectives should be achievable. If the targets which have been set cannot be achieved, then this may cause the people to get demotivated and even discourage them as they would think that the target can never be achieved anyway. Question such as the following arise to which this element answers;

1) Can the task be achieved by the specified person?
2) Does the person in-charge have the capabilities and the knowledge to fulfil the expectations?
3) Can the task be carried out in the given time frame?
4) Can the task be carried out by the given opportunities and resources?

This part of the SMART philosophy gains the people’s interest towards the work as the task is achievable. As people believe that once they input their efforts, it will be bringing them success.

Celsius Inc. has built its manufacturing factory in the city of Jaipur in India which provides the company to be able to get the materials and labour cheap. Besides, Jaipur has a developed traffic system where Celsius will produce their products with lowers costs and use the convenient traffic system in order to send to other areas. Furthermore the city has a good economy and has also been developed as well as giving it a much celebrity appearance which will help the company’s product release easier and have a faster fire like promotion in the whole of India show casing that a new aircon from this city is coming on for sale. Chakranarayan2,009).

2.1.4 Relevant/Realistic

The R in the SMART stands for Relevant/Realistic. This element of the SMART is there to make sure that the goals set in the objectives are persistent with the mission. Other goals which are in alliance with the main goal is also to be considered a relevant goal. This element answers the following questions;

1) Should it be done?
2) Why should it be done?
3) What will be the ultimate impact?
4) Will the information which is to be applied to specific problems be faced by the marketers?

The objectives must be formed while keeping in mind the current and possibly the future economic conditions as well as the actuality of the businesses. Increasing goals in times of recession or when there are competitors opened just next door would be reality check. So keeping in mind the relevant and the realistic elements should only be the objectives be set.

The goal of the advertisement is to make the product be able to attain more sales. It will make more customers to get the product of Celsius. The objective of the program is much suitable for the Celsius mission which aims to provide much suitable and cheaper products to the customers who do not have the ability to afford expensive products such as big Air-Cons.

2.1.5 Timely

In SMART the T stands for being the Timely element. This element refers to have the objectives to state clearly as to by when it should be achieved by. From past experience of major corporations and philosophers, it has been deduced that goals or objectives will not be fulfilled if there are no deadlines specified. If an objective is set with the due date of achieving the certain goal, then it will be done in that period of time or else the consistency of the work would not be adequate.

The objective of the advertising program has a clear mentioned time standard; the sales of the Frostbit should achieve INR 1,000,000 in its first season. It is a requirement and also a motivation for Celsius Inc.

3.0 SWOT Analysis

3.1 Internal Analysis

An internal analysis refers to the investigation towards an organization’s capability, cost- position and competitive feasibility in the market. (NicoleF. 2, 018) Guiding an internal analysis often integrates actions that require useful info’s collected via organization’s SWOT analysis that uses:

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The diagram above illustrates the Celsius Inc. internal strengths, weakness, opportunities & threats in order to stay competitive and keep the business running. The points are explained through in depth analysis below.

3.1.1 Strength

3.1.1.1 First Mover Advantage

As Celsius Inc. came out with an innovative product, this would attract new potential customers towards the company. There would be a great hype amongst the customer to try the innovative product. People would often click towards company’s website in order to get introduced to company, read their brand value and stories to study further about the product offerings, especially as it is comparatively unknown to the customer. (KevinJ.n, .d) . This attention could lead towards positive publicity for a larger customer base and in terms more sales for the company's products.

Thus, the business would achieve a competitive advantage by being the first mover in the market. The innovative product would eventually lead to establishment of strong brand recognition and faster customer loyalty before any rivals enter the marketplace.

There is a clear trend in the market that customers trend to pay attention with the new sustainable sources. Therefore, our company comes with fit the market trend and after research the local characteristics we have create FROSTBIT which able to use 100% solar power for keep running 10-12 hours in one time charge.

3.1.1.2 Pricing Flexibility

Since other rivals have not yet come up with similar product offered by Celsius, the company doesn’t have any formal competition or price war occurring in the market. Now, the company could be flexible in terms of choosing appropriate pricing strategy that fits their objectives. (RozS.W. n,.d) Moreover, the company could charge higher prices in peak summer seasons. At times, price skimming could be profitable as customer would be willing to pay premium for the value received in harsh summer conditions and in winter seasons price could be dropped to increase the number of sales. Hence profit and development cost could be easily covered before any competitors arrive.

3.1.1.3 Company Reputation

Since Celsius Inc. manufactures product from most recycled items, the business could turn into an industry leader with a reputation towards evolving environmental changing eco- friendly products and getting them to marketplace. Several researches illustrates that a solid record of eco-friendly products could enhance both customers’ and employee attitude towards the business operation. (ChrisN.2,016) If a consumer sees the company contributing towards environmental protection, he or she would purchase more of their product and would be less eager towards changing to competitor’s brand. On the other hand, employees feel proud of organization that is dedicated and responsible towards manufacturing eco-friendly product. Hence, this overall reduces staff turnover and increases in company’s brand image.

3.1.2 Weakness

3.1.2.1 Lack of Online Usage

Consumers are updating and increasing internet usage to inquiry companies, discover contact info’s and browse for e-shopping (. NeilK. ,2018) .It is seen that, Celsius Inc. targets market segment that belongs more from rural areas of India, where the segment lacks in online usage. As a result, such customers would not able to realize Celsius online presence and offers, such as content found on their official websites or in social media profiles. So it would not be cost effective for the company to throw online advertisement to such customers. Hence, it becomes much difficult for the company to attract online base customers due to their less online presence. Celsius businesses might lose sales if their competitor’s audience has more online accessibility.

3.1.2.2 Branding and Reputation

Celsius, being new in the market, it lacks in better branding and enhanced reputation than any other established company. Customers are not aware of Celsius Inc. specific retail stores or product offered by the company. Lack in experience, poor brand recognition, reputation amongst the customer and low percentage of company’s market share is potential weakness towards their new business operation (. MirandaB.2,018)

3.1.2.3 Weak Supplier Relationship

As both the company and the product are new in the market, the company did not build enough reputable relationship with their suppliers. Hence, supplier power could be high for Celsius Inc. (James.W,2013) Suppliers could exert extreme pressure towards company business through rising price charge, dropping quality standard, or decreasing availability of raw materials required. This could upsurge the manufacturing cost and overall effect Company’s pricing strategy. (NeilK. ,2018) Moreover, big suppliers would have less trust upon giving credits to such new business which not yet achieved experience or strong brand image which might also effect the Celsius Inc. cash flow.

3.1.2.4 Human Resources

Limited human resources availability is often a major weakness for any new business starters. (MirandaB.2,018) Celsius Inc. restricted human resources could comprise having a smaller team of staffs, which often makes it difficult towards tackling each item on the business to-do list. Besides, Celsius with full staffs lacking in knowledge, expertise skills and necessary training towards performing everyday tasks could interrupt their departmental operations. If the company introduces its CRM activities, but none of their staffs had understanding in CRM than it could be a major weakness sign for the company. Either the business has to appoint an advisor, or risk the new initiative.

3.2 External Analysis

3.2.1 Opportunity

3.2.1.1 Global Emerging Market

As Celsius is new organization in the industry it has opportunity to grow with its product FrostBit because of the increasing demand of the recycle products. FrostBit is an energy saving electronic therefore, it has opportunity to grow rapidly within the global emerging markets. Moreover, as the lower & middle class people searching for better standard of living the company can anticipate growth in coming future.

3.2.1.1 Increasing Demand of Differentiate Air-Con

Day by day people are becoming more dependent on technological stuffs. Air con is one of them which people rarely can avoid in India during the hot sunny seasons but not everyone can afford. Moreover, many people argue that using conventional air-con damages Ozone stage. Therefore, Celsius has the prospect in the future market to be the dominant. As ForstBit is very affordable and cheap in price people can easily have one of two. However, Celsius need to invest more towards the R&D so that they could offer the customers a better quality products.

3.2.2 Threats

3.2.2.1 Large Number of Competitors

Celsius is an organization who is new in the market. But the market has already been captured by large organization and low cost Chinses products. Therefore, it has been identified for ForstBit as a threat to become popular in the market and earn market share.

3.2.2.2 Narrow Product Lines

Most of the organization has very diversity of product lines, miscarriage of one product line will have opportunity to balance up with the impact on the others and will result in brand not to wearing away. But the Celsius has very narrow product lines as it is a beginner in the market place. Failure in the market place by one products could wash it away from the market.

4.0 Market Analysis

One of the most effective elements for marketers is market segmentation which allows accommodating to target audiences / customers. Segmentation makes stress-free for company to distinguish its operations, emphasis on what’s required to do (Dutta, 2018). Celsius Inc. use different types of market segmentation.

4.1 Demographic

Celsius Inc. use demographic segmentation to identify the profitable market as well as to reduce the cost of unnecessary expenditure.

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Moreover, it will provide the opportunity to increase the sales. By knowing the customers Celsius actually understand the story of the full market. Marketing strategies such as product packaging, advertisements, pricing and business location are developed based on the demographic segmentation.

4.2 Geographic

The acute purpose of Celsius is to make profits. Since, India is a huge country it's an effective method for the company to identify the needs of the customers because different places got different customers whereby the demand of the product is also cannot be same. In addition to our business is about to run and the budget is limited as a small and beginning company. So, Celsius has divided it market and identify the state, city, small city and rural market.

4.3 Behavioural

How an individual’s act as consumer behavioural segmentation is the method of segmenting the customers based on their purchasing habits, spending habits. Based on behavioural segmentation, it is easy to understand customer’s loyalty towards the Celsius product.

4.4 Psychographic

Based on psychographic segmentation Celsius generally try to find out the lifestyles of people who live in rural area of India, their daily activities, interests and opinions as well. However, based on psychographic segmentation Celsius determines about the beliefs, value, emotions and personality of the target audiences.

4.5 Market Needs

Market needs is a concept in Marketing which relates the functional and/or emotional desires and needs of the market population which has been targeted. A successful organisation identifies the segments of customers whom are not effectively served by either the existing companies and therefore develops a product or service to effectively serve that target market.

On the north-western side of India the people in Rajasthan have facing the issue that the hot wave resident in long seasons. They bear the scorching heat of the sun from March to September. Rainfall in Rajasthan is very scanty therefore, it suffers from drought. In this kinds of environment people want something can help them get out of the hot in the daily life. They have fan and air conditional in their house but there always get Load shedding. Besides, it is not convenience for the people who stay outside to have a cold from the AC. Therefore, they need a product with easy carry and running without traditional electricity power.

4.6 Market Trends

There are different types of trends in the market; Short, Intermediate & Long Term Trends. These are the three types of trends which are seen by studies of technical analysis. Market Trend is alleged to be tendency of the financial markets to move in a particular direction over the course of time.

Now days in the market there are many industries changed by the “new energy revolution”. In automobile industry, based on the data development from latest statistics from the China Passenger Car Association Sales of new energy automobile market increased 59.6 % to 82,000 units on a yearly basis in 2018 (Zhang.2018). In water heating industry, Solar water heating technologies is known by everyone, there are 165 approved India solar water heater manufacturers and more than 1000 companies capable of installing them, (Bruce Whittaker.2018)

4.7 Market Growth

Market growth is quite straight forward, the increase in the numbers of the customers who buy or have bought the goods and/or services. In other words it means that there has been an increase in the demand for the products or services. A market growth may either be slow or fast.

In 2015, the ISO 14001 has been revised. The latest ISO 14001:2015 has covered more details in the local environment, the negotiations with leadership and responsibility. Based on that we can justify that the sustainable clean source technology will be highly required in next 10 years. (ASQ. 2018.). Therefore FROSBIT with a special innovation designing. In addition the climate and desert in Rajasthan make FROSBIT can have quality sunshine and transfer to the energy to bring the cold for customer.

5.0 PESTEL Analysis

Environmental analysis is a study of tactical tool. It is also a process towards identifying both external and internal elements which could influence an organization’s performance. (Pestel. A C . 2 ,015)

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*Figure shows environmental analysis (PESTEL) – for the Celsius Inc. to evaluate the external environment that could impact way the business do operation in an India.

5.1 Political

Political factors refer to the government's observation and their attitude towards establishing subsidies along with government priorities to support businesses. (Chakranaraya2009)

India, being largest democratic in the world, it runs on federal government system. The political environment is mostly influenced by aspects like politician’s welfares, government’s policy and ideas of numerous political parties. (Rosy2,016)

5.1.1 Political Vulnerability

Several Indian markets and industries are very vulnerable due to politically instability that occurred in the past but it is currently stable. In the past, political events had affected several stock prices due to which the stock return and trading capacity had brought several fluctuations. (NishatM, a.nMustafaK, .2;002) .

As a result, if the country faces sudden political events taking in the future, than it would affect Celsius sale trading, volume and distribution of their product to retailers.

5.1.2 Government Executes

Several variable political factors can bring effect to Indian business environment (Chakranarayan2009) . One major factor includes taxation developed through governmental structure leverage by Union, state bodies and urban bodies. The government executes certain tax upon income, sales and service of land and properties. Politics also impact privatization as interfering political could reduce efficiency. (AghaN.2,011).

As a result such tax factors mentioned above would be also including on Celsius Inc. business operations. The company would need to pay tax upon their incomes, sales of goods and property owning. This all would increase company’s manufacturing cost and product prices.

5.2 Economical

Ever since the declaration in terms of industrial reform policies towards year 1991, India's economy had been noticeably steady. The country showed favorable advantage and permission on liberalization of foreign capital, industrial authorizing, public division enterprises, and foreign technological agreements (Chakranarayan2,009).

5.2.1 GDP Trends

The country saw 7.7 percent growth in 2015 registering a GDP of U.S $5.65 trillion and 8 percent on the following year. Besides, there was a remarkable growth towards direct foreign investments in year 2015 accounting U.S$15.532 billion, overtaking China. (AghaN.2,011).

5.2.2 Increased Inflation Rate

In the present scenario, the country is going through inflation, where customer prices in India amplified to 4.88 percent during 2017, more than the previous years. (Financialreport, 2017) The increase inflation rate becomes a matter of fear for India’s futures market.

5.2.3 Fluctuating Interest Rate

The country keeps altering their interest rate years after years. As a result, too much fluctuation in Index futures, banks and stock it tough for companies accomplish futures trading. (Chakranarayan,2009).

It is true that, increased GDP of a country provides better living standard of society, reduces poverty and increase income of people but it is seen that due to high inflation rate customer purchasing power would become less. People would purchase less which would eventually effect the sale of Celsius Inc. products. Besides, high interest rate would increase Celsius Inc. manufacturing cost and small company like Celsius would generally lose their money in undefined markets fluctuations.

5.3 Social Factors

Social factors include a wider diversity of both demographic and cultural aspects of the society that forms the macro environment of a company. Social factors include individual attributes such as age, population and growth rate. (AthanasiosK.&,GeorgeR.2,013)

5.3.1 Job Creation & Human Resources

Changes in social factors have found influences on a business atmosphere. For instance, India's pension cost of ageing population to firms has increased along with recruitments of older workers (. Chakranarayan2, 009). Now, India's population is projected at 1.1 billion where two-third of country’s population is below national mediocre age of 26 years. As a result, the country’s possible labor force age between 15 and 59 is on the way towards growing nearly 761 million to 869 million from year 2011–2020. (Financiarleport2, 017)

These mention statistics highlights the company having vast demographic payments.

Many companies like Celsius Inc. would be benefited of increased human resource and by capitalizing their workforce the business would accomplish increased efficiency and effectiveness in business.

5.3.2 Weak School Learning Outcome / High Literacy

From kindergarten to grade 12 educations, only 63 % of students reach their secondary level and nearly 36 % completes their upper secondary school. (Agha.N,2011). Insufficient teaching method, weak teacher training and absenteeism influence towards underprivileged education. Hence, school dropout rates increases along with increased literacy rates.

If the country faces high rate of illiteracy than company like Celsius Inc. would have less skilled workers to contribute towards their business operation which eventually affect the company’s productivity, reputation and quality service.

5.4 Technological Factors

In recent years, technology is emerging at a rapid pace and consumers tend to become very tech-savvy. With the beginning of modern technologies, past technologies gets obsolescent and out-dated. If a company does not match up with the technological changes, it could stay behind its competitors (. AthanasiosK.&,GeorgeR.2,013)

5.4.1 Access to the Internet

India’s internet now serves 4G technology which also facilitates numerous other technological industries such as e-commerce. Previously only 0.3 % Indian sales took place through e-shopping tools. Now that, Indian online retailing sales are increasing by 140 % every year, Indian companies like Flip Kart and other worldwide players like Amazon are emerging their e- commerce business model that suits the Indian economy. Flip kart claims in recent years, 20 % of purchases are now being made through mobile apps (. AghaN.2,011).

The faster Internet accessibility would make it convenient for both Celsius and their customer to do futures trading. Customer frequently using internet would generate Celsius with more target audience and increase brand recognition in order to sale their product. Besides, Celsius Inc. could collect faster customer data, conduct market research, receive orders and provide faster customer services to help customer just through faster online assistance.

5.4.2 Lack of Infrastructure and Quality Power

In 2015, BP Energy publication predicted India’s power production would increase to 117% at the end of 2035, though power consumption would grow by 128%. (Agha.N, 2011). According to McKinsey and Company, 240 million Indian people and 18,452 villages lacks in electricity. (RajeshK.S2.,017)

As Celsius product targets people deprived of available power supply, Celsius portable aircon’s would be in great demand as people would need it in such electrical breakdowns. Above statistic showed that such electrical storage would enhance company’s sustainability in the future.

5.5 Environmental

While India had made several progress over decades, the country now faces numbers of environmental challenges e.g. floods , air pollution, water pollution, resource depletion such as forest and water, loss of biodiversity’s, and diversion of consumer waste into rivers.

5.5.1 Environmental Concerns

India usually faces numerous types of environmental factors and the changes in weather or climate could affect several businesses. The global warming is becoming a key external factor besides it is significant issue in order to grow desire towards protecting environment. Due to global warming some parts of India experiences reduction in clean water and lack of water supply attract diseases to people. Moreover, several types of pollution in India has affected the public health and their living conditions. Urbanization has already damaged the environment and expatriates might find it tough to live below some of these environmental challenges. (adamkasi, 2016)

5.6 Legal

In the latest years, few number of legal changes had been implemented in India in several industry to save both consumer and environment from manipulation and other forms of unethical practices.

5.6.1 Government Regulatory Policy & Law

The government has imposed several legal implication to regulate the illegal trafficking of retail industry product, which could create scarcity in certain areas besides the prices of such items goes up. The government provided policy where the industry has to follow the consumer protection laws and policies as well as the law towards protection of rights the labor, disability discrimination legislation and increased minimum wage. Moreover Indian government puts audit and regulatory authorities to check on firm to recycle goods and minimum waste disposal to the environment. (ukeassy, 2016)

6.0 Competition Analysis

A competitive analysis is an important segment of any company’s marketing plan. Through this assessment, a company can understand and establish ways in which it makes their product or service more exceptional to the market and attributes the company could play in order to appeal their target marketplace. (Neil.P2, 013). Evaluating competitive analysis, a company could make use of several preferable questions that would help them move closer to the form the analysis. These include;

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Celsius Inc. Competitors

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*Figure shows competitive analysis of Celsius Inc.

The first step near competitor analysis is company recognizes their existing and potential competitors. In the second process the company clusters their opponents based on their several competitive approaches. Than the company analyzes their plans, strategies and identifies the areas the rivals are most vulnerable. (Neil.P2, 013). The competitive analysis portfolio will help Celsius Inc. determine their strengths and weaknesses of their rivals within the company’s marketplace and strategies that would deliver the company with a diverse advantage that could be exploited in terms of product development cycle.

7.0 Marketing Strategy

7.1 The IMC Mix

7.1.1 Advertisement

7.1.1.1 TV

Celsius Inc. used advance advertising on the T.V to make the people aware of the product new launch. The characteristics of the T.V advertising helped make the company’s ad to be able to incorporate sounds, images and movements to make the whole package interesting for the consumers. In addition, it allowed Celsius to target the advertising in the specific rural areas. So just one month before the launch of the product, Celsius therefore that period of time, the one month before the launch to start giving teasers to the expected customers. This made the customers feel interested in the product from a lively and interesting animation and music. Thus customers could easily remember the product.

7.1.1.2 Newspaper

Other alternatives also allowed Celsius to target the advertising through newspapers specifically in the rural targeted areas. As comparison to the other alternatives this was considered a much cheaper choice especially as much of the rural areas people mostly use to read the newspaper instead of even having a tv at home. Furthermore, the short term times of the newspapers allowed for quick changes and keep on updating the expected target to stay in touch with the product. Giving the market targeted up to date information on the

7.1.1.3 Billboards

There are no other ways in which an advertisement can be provided for the full 24 hours, except a billboard. Celsius used the billboards to advertise their products on a long term advertising agreement and put them all around the rural areas, once the people would pass these billboards they would notice the arrival of the new product which would take them out of their agony of the heat they have been going through and gain their attention.

7.1.1.4 Personal Selling

For the record, the first-hand information of customer needs and wants come from personally visiting those areas for sale. Celsius, knew that feedback was as much as important as anything, so they always kept personal selling into the strategies and also that the customer feels much more relaxed and more convinced when dealing directly with the sales person of the company. At the offline locations, Celsius asked their employees to serve the customers to utmost quality giving them the time and making them understand about the product and answering all their questions. Customers are much happier in getting first-hand experience which gives them the feel of being important and a good part.

7.1.1.5 Sales Promotion

In the beginning, on every weekend, Celsius had started giving 20% discount for the customer who had membership cards. Celsius believed the reason for discount will facilitate the company to get more and new customers and the member card would help the company evaluate and analyse the customers purchase behaviours. The record from the membership card will be part of the company to understand and monitor its customers.

7.1.1.6 Public Relation

The 5 day promotion before the release made Celsius known to everyone along with their promotions through various channels. The communication between Celsius and its target market also took place in those 5 days giving the customers a better view into the company. The company got to answer the questions of the people first-hand and understand their point of view as well as had the consumers satisfied and gain their trust. Customers were found to be inquisitive and interested in the product.

7.1.1.7 Direct Marketing

Celsius Inc. had also used a lot of social media platforms to contact and communicate with the expected consumers. For example, Celsius had made a public Facebook account for its customers to get them the latest information on the product as well as the updates on the product. In addition to this, Celsius Inc. made an online blog for its customers to send them feedbacks and suggestions and gave updates and information pertaining to the product on YouTube, searching on YouTube would give them the opportunity to see video information which may be needed by the consumers.

8.0 Target Marketing

8.1 Undifferentiated Marketing

The next objective of the company is targeting the market and hereby Celsius determined to target undifferentiated market. Because Celsius involves overlooking segment differences and offering just one product or service to the entire market. We only focus on what is common in the needs of customers rather than on what is different. Depend on mass distribution & mass advertising and purposes to provide the product a superior image in people mind.

8.2 Target Audience

A specialist in the Business, Tom Duncan defines Target Audience as the group which has the potential significant towards the brand message in a positive response. The key in this is that of Effective marketing communication and that the messages to each segment have a specific kind of interpreter. (Agha. N, 2011).

Every business should know their target audience in order to provide for their needs. After the considerations of the opportunities which are presented by the vast market segments, the company will select one or more as their target market or target audience. Having target market profile which are made in general are not helpful in the present era (Ex. Specified as males/females from the ages of 18 till 55). The specified information must include more precise such as; Males/females of ages from 18 till 65 who are in specific fields and are either students or professionals or as such. The target audience should be defined by the demographics, geographic, psychographic and their behaviouristic. One of the universal rules in IMC is that there is no such general audience, communication must be with the specified audience so that the company words effect mostly and have complete use of the resources available. Chakranarayan2,009).

In the case Celsius, the audience they are targeted are males, females, children’s and elders from the ages of 15 till 80 who are living in the rural areas of India. This information helps in developing the communication efforts and how the target audience will react to the message of Celsius as well as how will the product fulfil their needs. Celsius targeted this audience due to the crisis of electricity and not much competitors have targeted this segment especially with much price hikes. Celsius has segmented their audience in such way that though the research conducted, it will help the company to identify the majority who are going to purchase and/or use the product.

Celsius has kept in mind of all these points and created their brand in such a way that appeals to their targeted audience and that it shows them the need of the product in their day to day life which will accommodate them in such ways. Celsius mainly targeted the low class or working class people in the rural areas who are affected in ways by the Load Shedding strategy of the country governance. The following table shows the target audience information in such a clear and understandable way for all.

In other terms, it can be said that Celsius produced its product in focus with the niche market. According to the consumer analysis, it can be said that the target market of Celsius is defined as being niche meaning in terms that those people who stay in the rural areas of India and don’t have the affordability to purchase an air-con. Besides these people are the ones who are facing the Load shedding problems every day, bearing in mind the hot temperatures that rise once load shedding hits.

9.0 Positioning

Once Celsius has definite which segment of the market it will enter, it also decide what position it wants to occupy in those segment.

Product Position – the way the product is distinct by consumers on essential characteristics.

Celsius has used almost all recyclable materials to make the products. Which makes Celsius Greener and different than others. Customer can easily change the products instrument as soon as they want. (Agha. N, 2011). It very convenient for its customers

10.0 Marketing Mix

10.1 Product

The product runs in such a way, that the box houses a powerful system to cool air which runs on max power since it has been started and generates the cool air through the condenser placed strategically to provide a much better and colder air. The product works in such a way that the air is sucked from the outside of the box which goes through the place where the condenser is placed. The product helped the people in escaping the heat and at least having cold air being blown onto them giving them a bit of peace in those times of hardship.

Apart from its many advantages, the FrsotBit1 has a uniqueness of its own. The main characteristics of the product would be the Cheapness, Reliability and the battery usages as being reusable and rechargeable. After a single charge the product can easily run up to 10 to 12 hours and the recharge only takes up to a maximum of 1.5 to 2 hours. Celsius created such a unique idea and product in such way which would benefit all. It has the essentials for day to day life usage. This product is also certified from CFC Certified, meaning it does not harm our beloved ozone or planet in any way. The people after experiencing this development would straight away be drawn into its mesmerizing specs and uniqueness.

10.2 Price

The pricing strategy of Frostbit1 incorporates the use of “cost plus fixed mark-up”. It means that the policy towards the pricing involves the consideration of the total fixed cost and variable cost of the product and add a reasonable profit into the item.

The first time Celsius entered the Indian market, the price offering for Air con by other foreign brands wore too expensive for the people staying in rural area. In order to spread out to the rural base in each corner and penetrate into the market, Celsius had decided towards reducing the prices to introduce price war and break competition. The aim of the company was to increase sales volume of frostbit1 which would eventually result in higher revenues and profits for company besides giving customer reliable, portable and cheap product.

A special marketing team had been appointed towards researching the market in extensive detailed manner. The market research aided in determining the prices of numerous competitors air con besides analysing consumer’s thoughts about the product that are available in the market. Every key factor had been examined and after appraising its own costing the actual price of the product was set. Total fixed and variable cost made around $3 per unit + $2 Mark up Profit which add up to $5 unit to customers to be paid for purchase.

10.3 Promotion

As a new organization or brand in market, promotion activities are very crucial for Celsius. Because it is the only action that can boost up brand recognition and sales in the market. Promotion refers to the actions undertaken to make ForstBit known to the people from all over India. For the promotional activities Celsius has chosen different channel and will follow the conventional advertising strategies which is including advertising through television, billboard, newspaper and magazine. However, at the very beginning Celsius will be some promotion, discount and incentives towards the customers. Offering membership will be a strategy for the company to get the information about the customers thereafter the company will looking forward to do the direct marketing after a certain level of achievement. It can also include consumer schemes, personal selling, and public relation.

10.4 Place

In order to keep doing well in the electronic industry and to create the competitive advantage for itself Celsius need to make sure that the placement or distribution is on a right track. Choosing the right place and right distribution channel for ForstBit can provide the Celsius to grow up and establish itself as a recognize brand very rapidly. Celsius will have retailer outlet in all over India (first in Rajasthan) which will be very convenient and accessible to potential customers. However, customers will have opportunity to purchase via local online shopping portals such as HomeShop18, Infibeam, IndiaTimes Shopping, Croma, SnapDeal and so on because Celsius has already been collaborated with those famous online platform in the case of sense of urgency.

11.0 Marketing Research

Secondary research

According to National Action Plan on Climate Change (NAPCC) published in 2008, it identified deployment of solar energy technologies as one of the national missions. It expect the government achieve the aim of producing 15% out of the whole electricity from new energy sources by 2020. Then in 2010, Government of India announced the Jawaharlal Nehru National Solar Mission (JNNSM) with the objective to establish 20 GW of solar power by 2022. It shows that there are huge demands of Solar energy in the future. Hence it will be the good opportunity for our company open up the market in India. (Mittal, Dai, Fujimori, & Masui, 2016)Besides, there is another study done by Thapar, Sharma, & Verma, (2016) detailing the various policies that India government set up for new energy industry. It include energy entrepreneurship, energy democratization, private sector participation, hedging and apportioning RE procurement, use of auctions with stringent participatory norms and so on. According to the report, the new energy industry going to have a rapid expansion in next 10 to 50 years. And base on that forecast, our company will have a huge reliable market space in the India market.

12.0 Capital

12.1 Financial Objective

We aim to get 50,000 sales of units and 100,000 $ in our first running year. Because the climate and the geographic of nation, there are will be huge demands for the product that can help local citizens get out of the hot in summer. Besides, the Price we set up is reasonable for all the group in the society. In addition, India government aggressively revised its renewable energy targets. According to the report from The Indian Ministry of Power, issued order no. 23/03/2016-R&R dated 14 June 2018 stating the revised Renewable Purchase Obligation (RPO), target of 21% share of renewable energy in its total electricity consumption by March 2022. Hence, in India there is a huge market space for FROSBIT to arrive the share. (cleantechnica.2018).

12.2 Budget

12.2.1 Value Proposition Budgeting

Our company mainly use the value proposition budgeting model for the company make the budget plan. Because of our company is a young organization in the market, we don’t have any extra investment to waste in the designing, production or promotion. Hence we decide use the Value proposition budgeting model as the tool for we save the money from the unnecessary wasting. This budget model ask for the manager have to think about the volubility for every specific spending and compare the coats of the each item to find the suitable solution for company. Through value proposition budgeting model our company can easily find out where is existing budget issue, then find the way to avoid those unnecessary expenditure.

12.2.2 Cost

Labor cost: 1$/hour---1 hour 10 units=0.1 $/unit

Material cost: 3.9$/units

Variable overhead cost: 1$/unit

Fixed overhead: 10,000$/month

Price: 10$ /unit

3.9$+1 $+0.1$=5$/unit

Machine purchase in July by 3 month installment

D&R expenditure: 30,000per month from September to November

Abbildung in dieser Leseprobe nicht enthalten

Table 1: Product Cost& Price

12.3 Break Even Analysis

Break even analysis is the tool for find the “Breakeven point” to help the company understand when the income will be equal with the expenditure. There is no net loss or gain, and one has "broken even", though opportunity costs have been paid and capital has received the risk-adjusted, expected return. And the company will be able to make the budgeting plan or strategy based on the view of Break-Even Analysis. (corporatefinanceinstitute. 2018). Figure 1 developed that the company will arrive the Break-Even when the sales get 4000 units in the market.

Abbildung in dieser Leseprobe nicht enthalten

Figure 1: Break-Even Analysis

12.4 Sales Forecast

Because of the Rajasthan is the largest Indian state by area and the seventh largest by population. And it comprises most of range of Thar Desert. We have a good expectation for promote our product in that location. According to the Table 2, in this year peak season, we have already achieved our finical objective with total 110,200 sales in India and 200,750$ profits. Besides, next year we planning to open up more market in overseas especially South Africa (the odder will come in slack season) which can make the complementation with the Indian market (Slack season in India will get peak season in South Africa) Therefore, we expect that in next peak season, our company going to achieve 200,000 sales in the world with 400,000$.

12.5 Expense Forecast

Abbildung in dieser Leseprobe nicht enthalten

Figure 2: Forecast Expend Chart

The Figure 2 has clearly showed the annual budgeting in 2018. We have spent a lots of advertising fee in this year because, as a new company we hope we can get more eyes ball from the customer and through the various advertisements our product will be noted in the India market. What’s more the majority budgeting is planned between March and September. This is from March to September Rajasthan will suffer the most terrible hot season. Hence our company will take that as our peak season.

The Expending plan also has a detailing consideration. The majority expenditure of our advertisements and promotion will only exist from March to September. Thus in the peak season (from March to September) the company will have high cost of advertisement fee to catch the nation market. Besides, solar source is a new industry in the market, every year we keep amount of budgeting for research in the solar source technology to keep the advantage of technology competitive power.

12.6 Marketing Expense Budget

Abbildung in dieser Leseprobe nicht enthalten

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44 of 44 pages

Details

Title
A Comprehensive Business Plan
Subtitle
Introducing a New Product (Celsius)
Grade
A
Author
Year
2018
Pages
44
Catalog Number
V504880
Language
English
Tags
Business Plan, New Product Launching, Marketing Strategies, Strategic Analysis, Market Penetration, Product Development
Quote paper
Moniruzzaman Kiron (Author), 2018, A Comprehensive Business Plan, Munich, GRIN Verlag, https://www.grin.com/document/504880

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