Name: hashmat niazi REG:2063309

Consumer behaviour Submitted to : Madam ummara rana

NATIONAL COLLEGE OF BUSINESS ADMINISTRATION & ECONOMICS

Dalda History and Overview:

Dalda is a brand of hydrogenated vegetable oil popular in South Asia. The substance was originally imported from the Netherlands in the 1930s by the trading company Dada Limited. When Hindustan Lever Limited wanted to brand it, the trader, who still retained a commercial connection with the product, said it had to be named after his company.

HLL wanted to include the letter 'L' in it for Lever (of the Unilever group), and thus was born one of the longest-living brands in India. Dalda, which came to be synonymous with the Banaspati (hydrogenated vegetable fat) genre, was recently extended to a range of edible oils. Hindustan Lever has since sold the brand.

In July 2004, Unilever Pakistan accepted the offer of Rs. 1.33 million for the sale of its "Dalda" brand to Westbury Group in collaboration with Unilever Employee Welfare Group, who formed a separated company under Dalda Foods (Private) Ltd. Dalda has now divested into Canola and Olive Oil product variants. Today, Dalda Foods (Pvt.) Limited deals in Banaspati and cooking oils, Ghee (Banaspati) and claim to use Virtually Trans Fat (VTF) free technology. With total annual sales volume exceeding USD 10 Million, Dalda is one of the leading brands available in Pakistan for over 60 years.

Current Market Situation:

The market is highly commodity driven and the consumers are extremely price sensitive. The final selling price of edible oil and banaspati is highly dependant upon the prevailing world oil prices. So Dalda has to make sure that it maintains a balance with the fluctuating world oil prices. This is the reason why Dalda uses replacement cost pricing rather than stock recovery.

Banaspati:
Hydrogenated vegetable fat, semi solid granular product with a slip melting point Traditional cooking medium, especially for meat curries and sweet meats. Mainly consumed in central and northern areas especially by the lower Lever Brothers Pakistan Limited pioneered this category in Pakistan, with Dalda. Banaspati is perceived to be old fashioned and unhealthy by the upper of 38 degree centigrade.

income/rural consumers.

income/urban consumers.

Cooking Oil Sharply divided into branded and unbranded segments. Branded segment s premium priced and relatively a recent development. Unbranded segment comprises of unrefined soybean, rapeseed and cottonseed oil sold loose to rural/lower income consumers. Branded oils (mostly soybean), sold mainly in the urban areas especially in the south. Lever Brothers Pakistan Limited with the entire product range of Dalda and Planta is the largest player, closely followed by Habib.

Lately sunflower and canola based single oils have aggressively entered the market.

Developments in the Product Line

1. Dalda Banaspati first launched in British India (1938) 2. Dalda Banaspati launched in Pakistan (1952) 3. Dalda Cooking Oil launched (1981) 4. Lever Brothers Pakistan Limited entered single oils market with Dalda Sunflower Oil (1991) 5. Dalda Cooking Oil Vitamin E (1994) 6. Planta (1994) 7. Dalda Banaspati re-launched with enriched flavor (1997) 8. Dalda cooking oil re-launched with addition of vitamin E (1997) 9. VTF Dalda Banaspati launched (1998) 10. Test market launch of Dalda Lajawab (1998) 11. Dalda Crisp n Dry launched (1999)

Competition:
Basically the branded market of edible oil and banaspati is dominated by four players namely; Dalda, Habib, Tullo and Soya Supreme. There are approximately 172 registered banaspati brands. Besides there is a very large unquantifiable unbranded market selling banaspati, unrefined soybean, rapeseed and cottonseed oil loosely to the rural and lower income consumers. Therefore it becomes highly difficult to estimate the market size.

In the banaspati market, Dalda VTF is a sure shot market leader. However, it is a market challenger in the cooking oil category lending the first place to Habib cooking oil. Planta is considered along with Dalda then Lever Brothers Pakistan Limited (LBPL) accounts for the highest sales volume. Consumers all over the country have great trust in the brand name of Dalda, which is considered to be a very traditional brand. The brand awareness and recall is 97%. It enjoys hard core loyalty in the 35+(female) age bracket. However, Dalda is weak in the younger segment, here it suffers at the hands of boredom. In this younger segment Tullo gold and Habib are the in brands because their packaging is trendy and the attire which they portray in their promotional campaigns is very young and energetic. Another problem is that Unilever International dictates the ingredients and the quality control terms for the entire product range of Dalda. This increases the final selling price, making it a premium product. LBPL has no leverage to come up with cheap ingredient brands. Therefore, they lose out to competitors like Habib who has Habib Nayab and Habib Handi catering to the lower income segment.

Credit Terms of Dalda and Competitors:

Dalda Habib Soya Supreme Imported Oils 4 Day cheque 3 day cheque 15 day cheque Cash

Overall Market Scenario for Oil and Banaspati

1st 2nd 3rd 4th 5th Dalda and Planta Habib Tullo Soya Supreme Others 35 % 28 % 17 % 14% 06 %

Swot Analysis:
Strenghts:
Daldas greatest strength is the blind trust of the consumers in the brand. The entire product range has extremely high brand awareness. The brand recall is as high as 97%. The quality of the product is maintained at high standards under the supervision of Unilever International. In the Banaspati category its the only Trans fat free brand available. Dalda is the largest player, closely followed by Habib.

Weakness:

The brand suffers with an image problem. It is perceived as an old brand and the consumers are bored with it. In the case of Dalda it poses great difficulties, as it is a regional brand catering to Pakistani and Indian markets only. There has been no innovative packaging change since 1994.

Opportunities:
Dalda can cash up the banaspati market in Northern and Central areas of Pakistan where there is a large consumption especially by the rural and lower income groups. The branded market has been receiving a warm welcome lately in the metropolitan areas of Pakistan. People are becoming health conscious and are switching to brands offering vitamins and cholesterol free attributes. There is a growing segment of working women in search of modern and convenient methods of cooking. Therefore, the flavored oils stand a very good chance.

Threats:
Fluctuations in the world oil prices. Banaspati is perceived to be old fashioned and unhealthy by the upper income/urban consumers. Lately sunflower and Canola based single oils have aggressively entered the market. The unbranded segment comprises an enormous 50 % of the edible oil and Banaspati market. This is sold loose to the rural/lower income consumers.

Current Punch Line:

Jahan Mamta Wahan Dalda

Unique Selling Proposition (USP)

Its USP is taste and Quality. It aspires to be viewed as a cooking expert.

Boston Consultancy Group Matrix (BCG Matrix):

Dalda is a cash cow where by providing Dalda Foods with continuous source of revenue.. The entire product range alone accounts for 80 % profitability of the firm.

High Market Growth

Low Market Growth

High Market Share

Low Market Share

MARKETING MIX (4PS):

Product Price Place Promotion

Bases for Segmenting Consumer Market
Geographic Segmentation:
The market for oil and banaspati is highly commodity driven. Moreover, the perceived difference between various brands is very little. Therefore, Dalda has to ensure easy access and availability or else it would lose out to competitors. Keeping in mind the strategic importance of a good distribution network, LBPL has divided Pakistan into six geographical locations. These include Karachi, Lahore, Hyderabad, Faisalabad, Islamabad and Multan. The neighboring areas of these metropolitan cities also report to the above mentioned six branches.

Demographic Segmentation:
The target audience will be primarily females starting from the age of 20 to round about 45 years of age. For Dalda banaspati and cooking oil the income strata would be Rs. 4000/- plus. However, the new flavored oils would be targeted at the upper strata of Rs. 10,000/-

plus. As the loose oil/banaspati consuming segment comprises around 50% of the market, therefore, Dalda junior would continue targeting this segment.

Psychographic Segmentation :
The entire product range would be targeted at females leading a trendy and modern lifestyle. Flavored oils would especially be marketed to working women looking for convenient and smart recipes.

Behavioral Segmentation:
We will try to increase the occasions of oil and banaspati consumption. Soon after Moharrum the marriage season will begin. This will be a good opportunity to cash on the seasonality effect. Through the introduction of flavored oils, we will be inducing new usage patterns. Following are the extra uses for this category: 1. Can be used for grill basting. 2. Can be used in salad dressings, dips, mayonnaise, etc. 3. Can be used as a drizzle in presentations. 4. Can be used in soups and stews. 5. Can be used for shallow, griddle and deep-frying. 6. Can be used for sauntering vegetables, sea foods and meats. 7. Can be used for brushing pizza dough 8. Can be used for adding lemon flavor to curry. 9. Can be used for marinating meat.

Placement:
Edible oil and Banaspati is highly commodity driven. The final selling price is greatly dependent on the prevailing world oil prices. Besides this the perceived difference between the various brands ion this price sensitive category is almost negligible therefore thew placement at retail outlets greatly determines the sales volume. In order to cash on the shelf space all through out the year LBPL lays great stress on having a strong distribution system. It has Six Branches one each in the cities of Karachi, Hyderabad, Multan, Faisalabad, Islamabad and Lahore. Each branch has a branch manager to whom several Assistant Branch Manager Report. Under each Assistant Branch Manager are Levers Distributor Managers. Each Distributor Manager is responsible for Five Distributors of Lever Range of Products. The entire inventory leaves the factory and goes to the depot where each distributor has already submitted the total weeks requirements. Bearing this in mind we strongly believe that Dalda is suffering at the hands of growing competition. To counter this we would improve the current shelf placement of Dalda by offering higher margins and substantial trade discounts. Higher margins would be tied with the sales delivered/achieved. For Example Sales exceeding Rs. 100,000/= would entitle the retailer a commission of 5% of the total Rupee Sales. Similarly on the sales of 100 units of the five liters pack the retailer would be given five extra units free of cost. While on the sales of 100 units of the two and a half liters pack the retailer would be given two extra units free of cost.

Pricing:

Edible oil and Banaspati market is extremely price conscious. The entire product range is perceived to be premium priced. This is mainly because of the margin pressures and the high quality expensive ingredients. LBPL has no say whatsoever in determing the quality standards and the ingredients used in the manufacturing process. The pricing strategy is cost based and we recommend replacement cost pricing for the repositioned Dalda instead of stock recovery pricing. As the current prices are dependent upon the prevailing world oil prices the new type of Pricing strategy will ensure that the spread between cost and selling price is kept to a minimum. This will make the prices of Dalda more competitive as the fluctuations in the market prices will be absorbed in the final selling price. We will maintain the current price of the existing product range. It is given in the following table. However, Lajawab and Crisp n Dry would be withdrawn from the market. The price of flavored oils would be as follows: Dalda Ginger n Garlic Rs.130/- for 1.5 liters. Dalda Lemon - Rs. 130/- for 1.5 liters.

Current Market Prices

BRAND DALDA Category OIL OIL Bottle Oil Bottle Oil GHEE GHEE Package Size 2.5 liters 5.0 liters 1.5 liters 3.0 liters 2.5 liters 5.0 liters Actual Price Rs./168/320/109/197/168/320/Price After Discounts 100/185/-

CrispnDry PLANTA HABIB OIL OIL OIL OIL Bottle Oil Bottle Oil GHEE TULLO T. GOLD SOYA SUPREME RAFHAN OIL OIL OIL OIL: OIL OIL

1.5 liters 2.5 liters 5.0 liters 2.5 liters 5.0 liters 3.0 liters 5.0 liters 2.5 liters 4.5 liters 2.5 liters 5.0 liters 1liters 2.25 liters 4.5 liters

109/160/320/169/323/330/500/161/330/165/315/165/190/300/-

100/162/308/-

Promotion:
Seeing the current market perception of Dalda, we have decided to change the Brand personality of Dalda. It has always been seen as a very motherly brand, a brand which has been used generation after generation. The tag line Jahan Mamta Wahan Dalda was the last repositioning given to this brand which yet again has its root from the motherly foundation. We strongly feel that Dalda needs to take a diametric turn around in the message that it passes on to its consumer.

\ The following are the steps we have planned.: A teaser campaign for the new position would be designed. This campaign would be strictly focused on the novelty of Dalda. The 7-second advertisement would create brand awareness for the new line extension of flavored oils. This particular variant would be marketed only to a select group of consumers belonging to the upper strata of Rs.10, 000/- and above. Besides this we will continue marketing Dalda Banaspati (VTF) and Dalda cooking Oil to not only the present segment of females aged 35+years but also to females between the ages of 20-34 years. These ads will try to portray a very trendy and modern setting, care would be taken to choose younger and fresher looking models. Dalda Ka Dastarkhan will be re-launched with a completely new look on both FM 100 and PTV world starting from next quarter onwards i.e. May, June and July. A newer aspect of Dalda will be brought into light in the coming year. This will reflect on the social responsibility effort those LPBL practices on its various brands. Dalda would be granting 10 students of Home Economics College for Women a sponsorship worth Rs. 150,000/- each. The scheme would start from January 1, 2001. Through this effort Dalda will be able to create a good name in its future target market. Females graduating from the institute formulate a potential consumer segment.

Promotion Costing:
1. Teaser: A 7- second TV commercial would be aired for one month (June). 40 spots would be aired two to three times a day, in the time slot of 6:45 p.m. to 7:45 p.m. Research has indicated that this time slot gives the highest reach of the target audience. The total cost of this campaign would come up to Rs. 2.1 million.

2. Dalda Ka Dastarkhan: The total cost of thirteen episodes on TV and a quarter year running on FM 100 would cost Rs. 15 million. 3. Print And Billboard: Total costing would sum up to Rs. 14-16 million. 4. Scholarship: Ten scholarships starting next year would cumulate a total of Rs. 1.5 million.

QUESTIONNAIRE
This questionnaire is for the purpose of research on Cooking Oils. You are requested to answer the questions properly so that our purpose may come true. NAME _____________ GENDER: M / F AGE: Profession---------------------------------Annual Income---------------------------MARITAL STATUS: MARRIED/ UNMARRIED 1) LOCATION / RESIDENCE (Encircle) a) Model town b) Joher town c) Township d) Defense e) Gulberg f) Cantt g) Iqbal town h) any other_____________ 2) Do you use Packet Cooking OIL? Yes No

3) Which brands do you use? a. Dalda b.Habib c. Tallo. d.Sufi e. Any other 4) Do you agree their Quality is according to your region? a) Strongly disagree b) Disagree c) Neither agrees nor disagrees d) Agree e) Strongly agree 5) To what extent it matches your Quality a) Not at all b) To some extent c) Cant say any thing d) To reasonable extent e) To a great extent

6) If another good quality Oil is available will you try it?

Yes No 7) Do you use these brands because no other good brand is available in the market? a) Not at all b) To some extent c) Cant say any thing d) To reasonable extent e) To a great extent

8) To what extent do you know that these brands are harm full to health? a) Not at all b) To some extent c) Cant say any thing d) To reasonable extent e) To a great extent 9) Do you agree that these Cooking Oil make Your food Delicious? a) Strongly disagree b) Disagree c) Neither agrees nor disagrees d) Agree e) Strongly agree 10) Is their original quality available? a) Not at all b) To some extent c) Cant say any thing d) To reasonable extent e) To a great extent 11) To what extent their advertising force you to buy their product a) Not at all b) To some extent c) Cant say any thing d) To reasonable extent

e) To a great extent 12) What quality you would like to have in new brand ----------------------------------------------------------------13) What role other brands are playing in social development. ----------------------------------------------------------------14) Any suggestion for new brands ----------------------------------------------------------------15) If you are provided different qualities of same brand can you differentiate between them and select original quality a) Not at all b) To some extent c) Cant say any thing d) To reasonable extent e) To a great extent

ANALYSIS: