PROMOTIONS and INTEGRATED MARKETING COMMUNICATIONS

How a brand is Promoted

After the product and its pricing is decided the final step comes to promotion of the product. It is the most important part of the marketing mix.

To be able to effectively communicate about the product, one should follow following 8 steps :

 

• For 5 star people of all age groups are TG
• Since 5 star belong to brand Cadbury so having an image benefit,whenever  someone recall chocolate caramel and nougat as ingredients what comes to mind is 5 star.
• 5 star has always done creative ads and moreover some time back it had a beautiful message saying "No hard Fillings". Everyone get the idea what they are trying to say
• Communication channel through which people advertise about 5 star can be TVC,print,word of mouth etc
• Budget is decided on how to go about the campaign or the ad.
• Marketing communication budget is allocated on 8 major modes : Advertising, Sales Promotion, PR, events, direct marketing, interactive marketing, word of mouth marketing and sales force. All these factors helped 5 star in building long term image,it has drawn attention through its various contests etc.
• Measurement of communication result is done by the fact that how much are the sales and what revenue is generated from it.

Integrated Marketing Communication 

AMA defines IMC as "a planning process designed to assure that all brand contacts received by a customer or prospect of a product,service or organization are relevant to that person or consistent overtime.

In this different modes of promotion and communication work hand in hand to provide consumers with the entire brand experience. It is an effort to position a brand in almost similar way across all mediums. It aims to get advertising, sales promotion, public relations and personal selling etc. Promotions are most effective when they are combined with advertising.

Various AD and Promotional campaign that 5 Star  has done are :

 

The Win With 5 Star Promotion is a consumer promotion activity launched by Cadbury India Private Limited that offers its consumers who buy 5 Star products in its limited edition variants, hereinafter referred to as “5 Star bars”, an opportunity to win a holiday in Bermuda along with a host of other prizes.

Other Campaign include "Lost in 5 Star" which was a contest in whuch advertising about 5 star was done.

These days 5 Star is recognized by "RAMESH and SURESH ads whether as TVC,Print or digital. It keeps changing it tag lines and also in regular intervals Cadbury releases a new AD so as to offer costumer something new everytime.

The following link will give all the evolution of ADs that were used to promote 5 star 

https://www.youtube.com/user/CadburyADCentre/videos.

 

DISTRIBUTION

Distribution Channels

Product distribution (or place) is one of the four elements of the marketing mix. According to AMA distribution in The marketing and carrying of products to consumers,

The various channels of distribution can be : 

Cadbury's distribution channels include the manufacturing warehouses where the chocolate production takes place. This is followed by wholesale and then retailer. From retailer the product is sold to the consumer.

Channel Design Decision :

Following are the points marketers keep in mind while designing a distribution channel :

• Analyzing customer wants
• Establishing objectives and constrains
• Identifying major channel alternatives
• Evaluation major channel alternatives

Retailers are the most important part of distribution channel as they are the direct link to the consumers.

5 star has a huge retailer base because it is easily available at stores ranging from local corner shops to malls to online shopping sites.

Various types of retailers are

• Store Retailers
• Non Store Retailers
• Franchising

Cadbury's distribution network encompasses 2100 distributors and 450,000 retailers with consumer base of over 65 million.and reaches 0.6 million retail outlets.
The distribution of 5 star is broken down as follows.

Company >> C&F agent >> Distributors >> Retailers >> Consumers

PRICING

Consumer Psychology and Pricing

AMA defines price as - "the formal ratio that indicates the quantities of money goods or services needed to acquire a given quantity of goods or services.” 

It is that element of marketing mix that creates revenue. Price usually depends on Customer value for a particular product and the competition on the same product.

There are 3 key topic on the basis of which consumer arrive to a perception of price.

1. Reference price: Consumer in their mind, set a price range in which they expect the product price to fall. This may be due to research,past experiences,society etc. A consumer tend to buy the product if the actual price is somewhat near to his reference price
2. Price-Quality Inferences: Consumer tend to associate price with the quality of a product. He thinks a product priced high has a better quality.This strategy go very well with products like perfumes,cars etc.
3. Price Endings: This deals with products priced in odd numbers, say 49,99,549,999 etc.This is done to play with the customer's psychology as he will prefer a product priced 999 rather than 1000

5 Star has been priced between Rs5/- to Rs30/- making it affordable for all sections of the society.

The price is really appropriate for this product because due to direct and indirect competition in the chocolate industry. If Cadbury tries to increase the price, consumer will start shifting towards the competitor and this will reduce the market share of 5 Star.

From the perspective of a firm following steps must be kept in mind while setting up a price for a particular commodity :

1. Selecting Pricing Objective
2. Determining Demand
3. Estimating Costs
4. Analyzing competitors' costs,prices and offers
5. Selecting a pricing method
6. Selecting the final price

Price is linked to buying decision as :

• alternatives of 5 Star are Barone and Mars,so consumer will compare prices of all 3 and will choose the best

 Customer Value Linked to Price :

• 5 Star being a cadbury product has a huge image benifit. Also the customer perceived value is high because of affordable price and easy availability.

 Price linked to ILC stage :

• 5 Star is in its maturity stage and hence to remain the market leader it has launched its new variant Chomp and kept the price of other variants constant.

 

PRODUCT STRATEGY

Product Mix

According to the AMA, product mix refers to “the full set of products offered for sale by an organization. The product mix includes all the product lines and categories It is also a set of all the products a seller offers for sale. The categories related to product mix are :

Product Width:

 It refers to how many product line a company carries. The parent company of 5 star is cadbury. So the product width of cadbury is 5.

Product Length:

It refers to the total number present in the product mix.

Beverages

• Bournvita
• Bournvita l'il Champs

Biscuits

• Oreo

 Candies

•  Eclairs

Gums

• Chiclets
• Bubblicious 

 Product Depth:

Number of variants of each product in the line. 5 Star has following variants available.

 

Also 5 Star is available in Rs 5/- 10/- 20/- 25/-.

Product Consistency :

It refers to how closely the various product lines are related in terms of end use,production and distribution. Cadbury other than chocolates also offers biscuits,beverages etc. More or less the target audience for the product is same so in order to save money products can be distributed through same channels. This defines the close relation between various product lines.

  Product Hierarchy

It stretches from the basic requirement that is created to the final product that satisfy the want.

According to AMA “an organizational chart type of array of the products offered in a given market, breaking first into product class, then product form, then variations on form, and then brand is product hierarchy. The basic elements are :

MARKETING MIX

Marketing Mix- FOUR P's

Marketing Mix basically describes different choices an organization needs to make in the whole process of bringing a good or a service to the Market.
According to AMA : The mix of controllable marketing variables that the firm uses to pursue the desired level of sales in the target market. The most common classification of these factors is the four-factor classification called the "Four Ps"-price, product, promotion, and place (or distribution). Optimization of the marketing mix is achieved by assigning the amount of the marketing budget to be spent on each element of the marketing mix so as to maximize the total contribution to the firm. Contribution may be measured in terms of sales or profits or in terms of any other organizational goals.

 Product :

• Under the brand Cadbury
• Availability of Variants (e.g. Fruit and Nut, Crunchy,Chomp)
• Available in 2 sizes
•  Contains Chocolate,Nougat + Caramel
• TG mainly Kids,but more or less every section consumes it

 Price:

• Price as low as Rs 5/-
• Anyone and everyone can buy it

Promotion:

• Part of a established brand 
• Extensive advertising through print and Electronic media (Suresh and Ramesh ads)

Place:

• Large distribution network
• It is available in big store to local kirana shops

PRODUCT LIFE CYCLE

Product Life Cycle of Cadbury 5 Star

Any product undergo a life cycle which has following four stages

• Introduction
• Growth
• Maturity
• Decline or Renewal
  

5 star was first launched in 1969 and after dairy milk it was one of the most sold chocolates in India. It was suitable for all the people in the country. With over 40 years of being a favorite of the Indian consumer, 5 Star still continues to be what it was back then.

5 Star is in its maturity stage and in order to save it from declining and competition it was re-launched with new packaging and variants (e.g. 5 star Chomp) so that it can connect itself with the TG esp the youth and make a strong hold in the market. Advertising and innovation in 5 star have made sure that it has continuous demand from its fans and provide maximum value to its consumer. 

COMPETITORS and INDUSTRY

Competition of 5 Star

In Indian chocolate market Cadbury has the highest share followed my Nestle. So clearly as a part of Cadbury 5 star in the Market Leader in the sub category.

The biggest competitors of 5 star are:

• Nestle Barone
• Mars 

  

  Source - http://businesstoday.intoday.in

  
  

  
  

  
  

After Cadbury Dairy Milk 5 star has the maximum market share close to 14%. What make 5 star a different from its competitors is  that it has a lot of variants available like 5 star crunchy , Fruit n Nut etc. The target customers are all age group belonging to every section of the society, so it makes it reachable to every customer segment.

In order to attract new customers 5 Star started off with a new Rs 2/- pack in which TG was mainly school going kids who can distribute it in school. No such variant of Barone or Mars exists and hence making 5 star is the market leader in this segment.