PROMOTION

Marketing Strategy of Olper’s

The key element in clinching product success is
designing a good customer driven marketing
strategy. The marketing strategy of Olper’s
depends on customer values and on their
product uniqueness. They create values for their
client by designing a good marketing strategy.
Below are the steps Olper’s follow to make
marketing strategies.

Market Segmentation:
Market segmentation is the process by which a company divides the whole market into smaller
groups.

Olper’s Segmentation:
Milk is a low involvement product and the consumers have similar preferences. They want the
milk to be healthy and free of impurities, they want the milk to be properly processed and
packaged and to contain the required vitamin and nutrients. These are the basis on which by
Olper’s segments the market. The main segmenting variables used Olper’s are as follows:

1. Geographic Segmentation
2. Demographic Segmentation
3. Psychographic Segmentation
4. Behavioral Segmentation

1. Geographic Segmentation: Geographical segmentation is when a company divides the

market based on geographical units such as nations, states, regions, cities, or
neighborhood. FCEFL has divided Pakistan into five regions/cities namely:

1. Karachi
2. Lahore
3. Islamabad
4. Peshawar
5. Multan

Olper’s has only segmented the milk market into the five big cities of Pakistan. This is
 mainly because the market for packaged milk is only 7% of the total milk market in
Pakistan. Packaged milk is mostly consumed in urban cities because of its relatively
higher price than that of unpackaged milk. The rural areas and small cities of Pakistan
rely on unpackaged milk because of prevailing poverty and a low standard of living.

2. Demographic Segmentation Demographic segmentation splits the market into groups

based on variables such as age, gender, family size and life cycle, income, occupation,
religion, and nationality. Many products which are high involvement are affected by the
demographics of the consumer whereas Olper’s is not bounded by these demographic
variables. FCEFL produces Olper’s for all potential buyers and users from higher- or
middle-class families. Even though the brand calls for a small percentage of an
individual’s income but lower class wouldn’t want to buy the brand maybe because they
are price sensitive or because they believe lose milk is better than processed milk and
has all the nutrients that the processed milk lacks. However, all the companies in the
milk sector are trying to change the image of processed milk as nutritionist milk.
Therefore, it can be said that Olper’s has been positioned as a brand for high income
earners. Due to the income factor involved it can be said that Olper’s milk target a
specific social class who are health conscious and concerned about their weight.

3. Psychographic Segmentation Psychographic Segmentation calls for dividing the market

based on social class, lifestyle, or personality characteristics. Olper’s targets all the
psychographic variables. They have mainly segmented the market more towards high
achieving and ambitious people. Their low fat and low-calorie product i.e. Olper’s Lite
targeted towards people who are health conscious and want to achieve more in their
lives. For example, advertisement for Olper’s Lite mostly show achievers who want to be
successful and have a healthier lifestyle. Olper’s also segments the market based on
variety seeking consumers; they offer a variety of different dairy products like milk,
cream and lassi. So, consumers who want to experience variety and want a change from
the traditional dairy market they will try Olper’s products.

4. Behavioral Segmentation Behavioral Segmentation distributes a market into groups

based on consumer knowledge, attitudes, uses, or responses to a product. Olper’s
products are segmented on the basis of the benefits that the consumer derives from the
products that people want milk that can be used as a tea whitener so obviously the
color of the milk does matter a lot. Secondly, customers want a product which they can
use for all purposes, not solely for a single use. Marketers of this firm have to keep in
mind that they have to compete with opponents such as Nestle and Haleeb which are in
this department for a period longer than Olper’s and they attain many loyal customers
who will prefer the their respective brand respectively.
Market Targeting
Market Targeting is the process by which a company evaluates each market segments
attractiveness and picks one or more segments to enter which the company deems fit. The first step
in market targeting is evaluating the market segments. The marketing team of Olper’s has identified
and carefully analyzed all the segments in the dairy market of Pakistan. A company no matter how
big cannot target all the market segments, so Olper’s had to evaluate and select the market
segments which were best suited to the company and fulfilled the objectives set by the directors.
Firstly, they only launched their product in the five big urban cities of Pakistan because it would not
have been feasible to launch in the whole Pakistan mainly because 93% of the Pakistani population
rely on unpackaged and unprocessed milk. Secondly, milk being a low involvement product is not
affected by all the demographic factors except for the income factor, so Engro Foods targeted
Olper’s only towards high earning individuals and middle- and upper-class families. Thirdly, Olper’s
targets its products toward high achieving, ambitious and health conscious people who do not want
to compromise on quality no matter the price. Lastly, Olper’s targets the market based on occasions
when people buy a product. They advertise Olper’s to be an all-purpose dairy product which can be
used as either a tea whitener, for regular drinking.

POSITIONING:
Positioning involves designing the product and image that will occupy a distinctive place in the
minds of the target market. As can be seen, Nestle Milkpack and Haleeb have the largest profit
margins and market share in the milk industry. Thus, the marketers at Olper’s have decided to
create its own unique image and then strengthen the position in the customers’ minds. They have
done this by taking several following steps:
 Packaging of Olper’s milk and Olwell in red color and Olper’s cream packed in purple color
are quite different and distinctive from the typical green and blue packing used by other
competitors.
 The brand has been positioned as an all-purpose milk that is meant for everyone, especially
for those who live life to the fullest, hence its tag line, “jo dil khol kay jeetay hain unheen
kay liyay hai Olper’s”
Olper’s always tries to create customer intimacy that is it focuses on satisfying the customers’
unmet needs. Processed milk is seen as less lacking all the nutrition that are part of milk due to
passing through so many processes. But Olper’s positions itself as milk that has not lost its
nutrients. The unique selling proposition for Olper’s is:
Subah Bakhair Zindagi, but recently the company changed the USP to: Jo dil khol kay jeetay hain
unheen kay liyay hai Olper’s. Both the tag lines have a very positive impact on Olper’s image
because of the emotions involved in both the lines. Olper’s used celebrity endorsement to position
their product.

The marketers have used different positioning for Olper’s products:

 a. They have used the attribute positioning for Olper’s milk. The main theme of the product is
that it is meant for all purposes without any user imagery. Olper’s ads also show attributes
of milk such as good for health.
b. They used the benefit positioning for Olwell. The product is positioned as delivering the
benefit of helping to reduce weight and for healthy bones.
c. Olper’s cream is positioned as good for a specific use or application. In this case the cream
can be used to make cake icings and desserts look great. It can be said that all the different
stages have been performed by the marketers with extreme care and research.

SWOT Analysis:
STRENGTHSS:
1. Engro’s Back:
Olper’s is a brand of ENGRO foods. This means that consumers can relate their former
image of ENGRO foods to Olper’s. ENGRO is a well-established brand name in Fertilizer,
IT, and infrastructure business. The brand is well known so customers will automatically
have a brand association with Olper’s and see it as a premium quality product. ENGRO is
world renowned so it can easily attract foreign investors in backing it against other
competitors such as Nestle. ENGRO foods can easily afford research and development
costs for Olper’s have to introduce new products. It can also distribute the brand
through better channels because of its long-term relationship with distributors in the
agriculture sector.

2. PR with farmers:
ENGRO has been interacting with the farmers for fertilizers and has gained quite a good
reputation over the years. It has led to a strong bond and long-term relationship with
the farmers who are willing to supply milk to the company. This is an added advantage
and strength for the company because it will never be short of milk production. The
farmers also will not have to look elsewhere to sell their milk.

3. Positive response from customers:

In first year, EFL crossed 1.4 billion sales figure which shows customers’ satisfaction
upon EFL’s products.
 4. Proposition:
Its taste, quality proposition and world-class quality proposition system.

5. Strong consumer & product research:

Olper’s done a strong consumer & product research before and after launching the
product. This has provided them the perfect launching pad to eventually emerge as a
global player in the food industry. To develop its future portfolios, EFL has hired various
global research partners like AC Nielsen, Mindshare, JWT Asiatic and MARS marketing
and advertising agencies.

6. Third-Generation Plant
EFL only, has the third-generation UHT milk plant in the country. EFL plant is the only
plant in Pakistan that uses Bactofuge technology to virtually eliminate bacteria and
ensure premium quality and hygiene. Moreover, it is also setting up another milk
processing plant in Central Punjab (Sahiwal) with an investment of Rs. 2 billion (US $
33million).

WEAKNESSES:

1. Olwell TVC
Olwell ad which is based on Western life style, ENGRO foods brand management
showed a man who put off his clothes & remain just in his undergarments, or half nude
lady in a cat walk or men admiring the figures of a lady in mix gender health club. In this
ad they are creating associations with the brand through the stripes, which is a highlight
of Olwell packaging. Half-naked people have been shown with tattoos of the same
stripes to show that they are loyal consumers of Olwell. Also, the talent, situations and
locations connect well with the ad to give Olwell a premium positioning. The brilliant
marketing people at ENGRO Foods failed to analyse is that the market they are targeted
the ad on, is Pakistan, where practicing Muslims reside, who have strong religious
beliefs. When making the ad, the brand managers were focused on, making an ad that
should give the brand the most premium look and feel amongst the target consumers
but on the other hand they were least bothered about the ethics, religious beliefs and
cultural values.

2. Milk collection & distribution costs

EFL’s 34 out of 40 milk-collection centers are in Punjab, whereas its only milk processing
facility is situated near Sukkhur (Sindh). It increases the milk collection & distribution
costs; and increases the chances of milk getting spoiled because of increased travelling
time.

3. Narrow brand portfolio

It has been more than a year now, when EFL launched its first dairy product, Olper’s
Milk on March 20, 2006. But EFL’s brand portfolio still consists of just 3 products i.e.
 Olper’s Milk, Olwell Milk and Olper’s Cream. Whereas its competitors like Nestle and
Haleeb Foods have a much-diversified line of dairy products.

OPPORTUNITIES:

1. Increased funding by Government

Government has decided to increase farmers’ funding. This is an opportunity for ENGRO
foods because previously due to weather conditions and other reasons there was lots of
wastage of milk but now that can be reduced as farmers will be better able to store milk
for longer time periods.

2. Increased consumption of PLM

Competition may create opportunities for the company because each competitor in the
milk industry wants to increase penetration of processed liquid milk and so they will
create awareness for consumers through different advertising media. This will ensure
the increase in the consumption of processed milk instead of lose milk and so will in turn
lead to increase in sales for the company. Therefore, there will be an opportunity for
accelerated growth.

3. Awareness
Growing dissatisfaction with loose milk and increasing awareness about health and
hygiene issues have led to increased processed milk consumption.

4. Third largest producer of milk

Pakistan is the Third largest producer of milk in the world with a total production of
32billion litre of milk a year, whose value is more than that of the combined value of
wheat and cotton, from a total herd size of 50 million milch animals (buffaloes and
cows). Livestock accounts for 46.8 percent of agricultural value added and about
10.8percent of the GDP. Milk is the largest commodity from the livestock sector
accounting for 51 percent of the total value of the sector. Due to the steps taken by the
government and private sector, country’s annual milk production is expected to grow at
an additional 3 billion litres in the next few years. This is quite an opportunity for ENGRO
foods as there is lot of growth in this part of the sector.

THREATS

1. Competition
Competition may pose a threat because the company will have to maintain its
leadership in an expanding market so that it doesn’t lose its market share to its
competitors. For Olper’s it might be difficult to penetrate in a market where the loyalties
exist for such brands as Nestle and Haleeb. These brands have been in the milk industry
far too long and have left a mark in the minds of consumers in terms of quality.
Competition seems to be getting tougher as a result of new players entering the dairy
market.
 2. Perceptions and Price Differentials
Consumers’ perceptions and price differentials can cause a threat for the company. It is
important that Olper’s comes up to the expectations of the customers and fulfils its
conformance quality that is the company meets its promised specifications.
Consumer’s preferences change with time and prices might create certain barriers in
terms of the profit margins for Olper’s. For example, lose milk is still cheaper than
packaged milk and that is also one factor that people still prefer to buy lose milk.

CATEGORY TACTICS
PLACEMENT:
In-store product placement is the art of determining
where your products appear within a retailer through
planning, negotiation, and design. Effective in-store
product placement will boost brand recognition and
maximize sales.

Shelf Placement

Getting your product into a store is a massive

achievement, but, it’s just the first step in a longer
process. Not all shelves are created equal, and it is no secret that eye-level shelves and endcaps
are among some of the best locations for being seen by shoppers. Since your product probably
won’t start off with premium shelf space, negotiating with retailers is a must for brands
looking to improve their placement.  But with all of your competitors fighting to occupy those
same prime locations, how can your brand set yourselves apart from the competition? Selling a
partnership instead of just your product, leveraging data (more on that later), and making a
long-term pitch are just a few of the ways to get started.

STRATEGIC PLACEMENT:

Shelf share and location can give you a leg up over the competition. Sure, more facings make it
more likely that a consumer will buy your product, but there are other factors to think about as
well.

 Use the metric SOVI (Share of Visual Inventory) to determine your presence in the

category as a whole. Count the number of facings across an entire category, then do the
 same for your brand within that category. Divide your brand’s facings by the total
number of facings in the category to get a percent score, which is the SOVI.
 Take note of the height where your products are placed at. Eye-level is the most
attractive facing but think practically too. For example, you do not want a heavy tub of
protein powder on the top shelf making it cumbersome to reach. Likewise, single-serve
bottles would not get grabbed as easily on a bottom shelf.
 The literal measurement of shelf space can indicate category dominance. Notice
how Hiball and Clif occupy entire shelves, even if they are not at the most desirable
heights.
 Another consideration is product assortment. More SKUs on the shelf means more
ownership over consumers’ purchasing options. Most of the brands in the photo are
competing aggressively in this area.
 Differentiating yourself from direct competitors is critical if you are placed close
together. Nuun & Honey Stinger do this by using different packaging styles. Also be
aware of your placement next to indirect competitors. Guru and 5 Hour Energy are
targeting a different type of shopper regarding their packaging styles, but their products
could appeal to the same demographic.

PLACEMENT OF OLPERS: Placement is the distribution, location and methods of getting the
product to the customer. EFL capitalized on its decades of relations with the farmers to provide
world-class supply chain management with high quality and strong relationships and discounts
to retailers has gained them proper placement in retail outlets.

NAHEED STORE:
Naheed supermarket is in Bahadurabad, which is central Karachi. These types of supermarkets
deal with middle- and upper-income class consumers and for Bulk buyers. This shows that
Olpers has also been placed for whole sellers, shop owners like fruit shops or hotels etc. Olpers
milk product has been perfectly positioned in this type of Market. The section for all milk
products was separately identified in this supermarket and hence easy to spot by the consumer.
Olpers was positioned with its competitors and the second best in the market. Packaging of
Olpers and the distinctive red made it look a bit unique than the other milk products. The stock
of Olpers is replaced on time. There is never a shortage of stock of Olpers in this market since it
is a wholesale retailer. There was no specific order in which the products were placed and
neither were there any head shelves since all of this was in crates they were placed randomly
but the presence of Tetra Pak also available shows that it is also similarly positioned.