CHAPTER III COMPANY PROFILE and INDUSTRY … 26619-A marketing... · Mayora Indah Tbk. PT. Mayora...

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Universitas Indonesia

CHAPTER III

COMPANY PROFILE and INDUSTRY REVIEW

3.1. PT. Mayora Indah Tbk.

PT. Mayora Indah is one of the well-known national fast moving

consumer goods company in the Indonesia market. Consumers are familiar

with Mayora’s products such as biscuits, coffee, milk and cereal, candy,

chocolate, wafer, beverage, and noodle. Mayora have several strong brands,

not only in Indonesia market but also in abroad. The brands are Kopiko, Roma

Biscuits, Beng-Beng, Torabika, Energen, Choki-Choki, Vitazone and many

more.

Mayora started their business from a family business, their first product

is Roti Marie (ROMA). Because the business was running very well, the owner

decided to build the company and established on 1977. Mayora become public

company on 1990. The ownership of Mayora is held by the Atmadja’s family.

The Board of Directors consists of Yogi Hendra Atmadja (President

Commissioner), Andre Atmadja (Chief Executive Officer), Ongkie Tedjasurja

(Managing Director) and Theo T. Gazali (Sales Director).

Nowadays Mayora have 9 plants, 8 plants are in Indonesia and 1 plant

is in Thailand with eight thousand employees spread out in Indonesia and

overseas. Their products are already distributed to worldwide, including

Europe, Middle East, Africa, South East Asia (Thailand, Malaysia, Philippines,

and Vietnam), India, and China.

Mayora businesses are divided into seven strategic business units with

different legal firm based on products and one business unit specialized in

distribution under Mayora Group as a holding company. The strategic business

units are :

1. Biscuit Division – PT. Mayora Indah

2. Candy Division – PT. Mayora Indah

3. Wafer and Chocolate – PT. Mayora Indah

4. Beverage Division – PT. Tirta Fresindo Jaya

5. Coffee Division – PT. Torabika Eka Semesta

A merketing plan..., Adria Devius Tiono, FE UI, 2009

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BeveragesBeverages

Mayora GroupMayora Group

PT. MIPT. MIPT. KMGPT. KMG PT. DSCPT. DSCPT. TESPT. TES

ChocolateChocolate

PT. Inbisco PT. Inbisco NiagaNiaga

WaferWafer

PT. TFJPT. TFJ

CandyCandyBiscuitBiscuit

Instant FoodInstant FoodCoffeeCoffeeHealthHealthFoodFood

BeveragesBeverages



ChocolateChocolate


WaferWafer

PT. TFJPT. TFJ





ChocolateChocolate


WaferWafer

PT. TFJPT. TFJ



6. Instant Food Division – PT. Delifood Sentosa Corporation

7. Mayora Nutrition – PT. Kakao Mas Gemilang

8. Sales and Distribution Division – PT. Inbisco Niaga Semesta

Exhibit 3-1 Mayora Business Unit

Source : PT. Mayora Indah Tbk.

One of the divisions is Mayora Nutrition, the division exists because

Mayora wants to focus on developing products and deliver healthy products to

their consumer. Besides business purposes, it also has social interest to build

healthy Indonesian family and indirectly build a healthy generation to become

a leader and change Indonesia to become one of respective country in the

world.

3.1.1. Vision and Mission

Mayora’s Vision and Mission are:

• To continuously improve Mayora’s competitive position in the category

• To build strong brands and distribution channels in all fronts

• To provide a challenging, fun and financially rewarding working

environment where fair competition and a responsible attitude are

encouraged


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• To be socially and environmentally responsible

• To bring values to our stakeholders by securing growth and strong

financial structure in the industry

3.1.2. Organizational Structure

Exhibit 3-2 Mayora Organizational Structure

GM SEA

Business

CEO

Sales Director

Managing Director

Head ofSales

OperationGM HR

GM Head of SBUMarketing

CFOOthers GM

Comm. &

LogisticsMarketing Manager

Factory ManagerNational Sales

Promotion ManagerProduct Manager

Regional SPMArea SPM

Marketing StaffArea SP Supervisor

Head of RegionHead of Area

Regianal Account Manager

Key Account Manager

Area Acc, Mngr.MerchandiserAcc. Executive

BOD


Mayora has lead by BOD including managing director and sales

director. Even though Mayora is a public company but it is still lead by family

members, only managing director and sales director that comes from

professional background. Mayora Group has divided into several departments

in supporting function and sales & marketing function. Each department is lead

by head of departments or general managers as shown in Exhibit 3-2.

Supporting functions are consist of human resources department,

finance and accounting department, purchasing department, resource and

development department, and legal and external affairs department. Marketing


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departments are more complex, its divided into several strategic business units

depends on product category. There are seven business units that lead by their

own general manager which are biscuit, wafer, instant food, coffee, candy,

beverages, and Mayora nutrition. Below General Manager, there are

subordinates with different divisions. The subordinates are marketing manager

for marketing division, national promotion manager for trade marketing

division and also factory manager for factory. Product manager and marketing

staff are reporting to marketing manager or directly to general manager

because several business units didn’t have marketing manager because is

already covered directly by general manager. National sales and promotion

manager also have regional sales and promotion manager, area sales and

promotion manager, and area sales and promotion supervisor as subordinates.

In sales operation, there are three general managers or head of sales,

two responsible for traditional market and one responsible for modern market.

They are all reporting to sales director. Below head of sales traditional market,

there are head of region and head of area, they are responsible to handle sales

operation and work with sub-distributors. While general manager of modern

trade are responsible for key account management and also sales operation in

modern trade.

3.1.3. Competitors

Mayora is facing a lot of competitors in the market, not only the local

companies but also the multinational companies. The competitors may vary

depends on the categories itself, for instance coffee category, mayora is facing

Kapal Api or PT. Santos Jaya Abadi which also a big player in the industry,

now Kapal Api launch Ceremix which is the competitors from Energen Cereal.

The others are Orang Tua Group and Garuda Food which also a big player in

wafer and biscuit category. The multinational companies are including Kraft

Danone, Nestle and also Perfetti Van Melle.


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3.2. Energen

Energen is launch at 1991 in Indonesian market. Since then over 17

years Energen has become a big brand for instant milk and cereal product.

Energen was put under Mayora Nutrition division, and management want this

brand become umbrella brand for Mayora’s product that have nutrition value

base and good for health.

Chart 3-1 TOP 10 Volume Market Share Trend 2007 - 2008

4.1 3.9 4 3.8 3.7 3.7 3.6 3.6 3.4

9.97.88.17.88.8

7.5

7.26.7

8.7

7.07.0

8.87.4

6.47.37.35.6

6.8 7.9 7.47.5

7.2 7.0 7.76.3 6.6

3.9 4.3 3.8 3.5

68.9 69.8 71.0 70.3 69.969.6 70.571.2 70.6 70.9 71.6 71.2 70.0

Jun-07 Jul-07 Aug-07 Sep-07 Oct-07 Nov-07 Dec-07 Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08

Nestle

Quaker

Simba

Energen

Ceremix 2.6 2.5 2.5 2.8 2.5 2.7 2.6 2.3 2.3 2.5 2.3 2.5 3.2

Gery 2.8 3.1 2.9 2.5 2.0 3.2 2.4 2.2 2.3 1.7 1.7 1.6 1.6Spontan 0.2 0.2 0.4 0.1 0.3 0.3 0.6 1.0 1.4 2.4 2.2 2.5 3.0Ligo 0.9 0.9 1.0 1.0 0.8 0.7 0.8 0.7 0.7 0.8 0.8 0.7 0.7Migi Migi 1.3 1.1 0.9 0.7 0.6 0.8 0.8 0.6 0.5 0.5 0.5 0.4 0.3Kelloggs 0.5 0.6 0.7 0.6 0.9 0.6 0.7 0.7 0.6 0.5 0.6 0.6 0.5

Source : AC Nielsen Retail Audit

Energen is a pioneer of this category in Indonesia. From 1991 to 2008

Mayora through PT. Kakao Mas Gemilang has put Energen as market leader

with 70% volume market share in breakfast cereal category. Chart 3-1,

Energen is facing several big players in cereal market, multinational

companies with global brands like Nestle and Quaker Oats, and also local

players like Simba and Gery. Energen succeed to maintain it market share

trend and still positively growth following the growing breakfast cereal

category.


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Table 3-1 Volume Market Share & Distribution Change 2007 - 2008

Volume Share MAT Share Chg

MAT Vol. Chg Max Numeric Dist. ND CHG

MAT 07 MAT 08 07 VS 08 07 VS 08 MAT 07 MAT 08 07 VS 08Kakao Mas Gemilang 67.7 70.5 31.4 62 66Nestle 10.5 8.4 1.7 5 6Quaker Oats 6.8 7.0 30.6 1 1Simba Indosnack Makmur 4.2 3.8 11.9 10 10Santos Jaya Abadi 2.3 2.6 40.5 5 6

Garuda Food Jaya 3.4 2.2 -17.3 8 9Utama Pangan Sentosa 0.1 1.3 1,028.9 2 6Aneka Makmur 0.8 0.6 4.0 0 0Sari Murni Ind. 1.1 0.6 -29.4 9 7Kelloggs 0.7 0.6 9.9 0 0

-0.1-0.5

-0.1

-1.2

1.1

2.8

-2.0

-0.5

0.2

0.3

0-2

0

4

41

0

1


If we look at Table 3-1, it shows us that Energen still gaining market

share 2.8% from total cereal market. One of its factors is by expanding and

increasing distribution network for 4% and also through marketing activities

that support the brand.

AC Nielsen, a independent research company was divided breakfast

cereal category into three segments :

1. Hot Cereal : pure grains or oats that still need to cooked or mixed

with hot water, in example Quaker Oats.

2. Mix Cereal : cereal that already mixed with milk and sugar or other

ingredients, in example : Energen and Ceremix.

3. Ready To Eat : cereal that already gone through production process

into finish product and directly ready to eat, in example Kellogs,

Nestle Coco Crunch.


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Chart 3-2 Market Volume Trend and Growth of Cereal Category 2006 - 2008

1,1751,258

1,316 1,296

897

1,118

784

9621,065

64 68 86 97 89 99 103

546

708791

891955

1039 1016

170 181 182 211 186 185 212 176 175

68 77

827

644

Jun-06 Sep-06 Dec-06 Mar-07 Jun-07 Sep-07 Dec-07 Mar-08 Jun-08

Breakfast Cereal Hot Mix RTE

MAT 2008Share

Cereal 100.0Mix 76.9RTE 15.3Hot 7.7

Volume Growthvs MAT 2007

Cereal 26.2Mix 33.7RTE -1.6Hot 28.1

Notes :MAT 2008 starts from Jul 07 to Jun 08

Volume in tonnage


Volume wise, Breakfast Cereal market is growing robustly compared to

last 2007. Volume grows by 26.2%, while the value grows by 26.6%. This

growth is driven by the positive movement of Mix and Hot cereal, while RTE

is slowing down. Mix Cereal grow by 33.7% in volume and 37.9% in value,

while Hot cereal grow by 28.1% in volume and 27.9% in value, Chart 3-2. Mix

Cereal is still dominating total breakfast cereal category 76.9% contribution.

That’s why Energen which has 90% market share from mix cereal segment was

also the leader in breakfast category.

Table 3-2 Value Growth Breakfast Cereal and Powder Milk 2007 - 2008

FMCG Category VALUE % CHG YA

Breakfast Cereal

Powder Milk

27.9

18.6



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Table 3-2, compared to powder milk, breakfast cereal is having higher

value growth this year. It’s showing that breakfast cereal is one of the potential

categories that have to taken under consideration by companies that running on

this industry. Especially in powder milk industry, because it have indication

that powder milk’s consumer are start moving into mixed cereal products

because of cheaper price and its claiming basic nutrition values. The switching

also affected by economic condition in Indonesia which not very well in the

last few years.

Chart 3-3 Cereal Incidence of Usage 2007

Source : Marketing Research Indonesia

However, despites of the entire growing cereal category, Chart 3-3

shows level incidence of usage or number of cereal consumers is 50%, this

number is below biscuit category who has reached 99% penetration. This could

means that there are still potential consumers that have never been touched

before by the cereal companies and they have never aware of cereal products,

or there are people who are not consuming cereal because they don’t like it or

they have substitute product for it.

60

25

48

21

57

48

50

Makasar

Medan

Surabaya

Semarang

Bandung

Jakarta

Total


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Chart 3-4 Brand Awareness of Cereal Products in 2007

TOM Others Aided

0

0

1

1

1

6

88

2

3

10

10

16

29

8

14

18

27

50

44

44

3

0 20 40 60 80 100

Kellog’s

Vitagen

Corn Flake (Nestle)

Quacker Oats

Simba Sereal

Milo Sereal

Energen sereal

Source : Marketing Research Indonesia

Energen is not only dominating the market, but the brand already well-

known and have the highest top of mind in consumer through brand awareness

research, Chart 3-4. Energen has reached 88% top of mind in consumer, it

means that 88% of respondents already aware of Energen as a brand of cereal

products. This number is very far from the next second largest top of mind

which is milo cereal that only has 6% from total respondents. Energen also has

8% of others brand, which is the second brand that respondents said after the

brand that become top of mind. If we add 88% with 8%, it means there are

96% people supposed aware of Energen.

The percentage of Energen’s brand awareness is very high compare to

other brand in same category and the other category. Energen begin to become

generic brand for cereal product. With a well-known brand, Mayora start look

opportunity to use this brand for making an extension of the product, not only

in the cereal category but also other category as long as is focusing on health

positioning.


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3.2.1. Energen – Brand Extension

Energen is a brand that already established in consumer’s mind, very

high number of top of mind in brand awareness explained that Energen has

become well-known brand in consumers. With using Energen, Mayora think

that Energen can help Milkuit as a subbrand by creating or enhancing

awareness of the product, quality or trust associations, and a customer base.

As a result, there is the potential to save go-to-market time and resources,

thereby enhancing the chances of success.

Aaker mention that recognized brand name on a new product means

that name recognition has been accomplished, and the communication task is

reduced to the more manageable one of associating the name with the new

product class. Milkuit can and should reinforce the brand image of Energen,

thus providing a brand building function instead of weakening the brand name.

Energen is still looking for increase their healthy image, Milkuit is one of key

driver or tools for increasing Energen’s image, Exhibit 3-3.

Exhibit 3-3 Energen Brand Portfolio

Fuel to Win over daily Challanges

Family Teens Female adult Kids

Fulfilling nutrition /indoor

Fulfilling nutrition

/on the go

Teen Energy

Low Sugaron the go Nutrition

Low Faton the go Nutrition

Fun Milk Energy

Milk BiscuitNutritous milk

& cereal

ChocolateVanila

Green Bean

OriginalChocolate

Nutritious Milk & Cereal

ChocolateVanila

Green Bean

Cereal RTD Milk

ChocolatePlain

Milk Biscuit

ChocolateVanila

Green Bean

OrginalChocolate

Cereal Milk Biscuit

ChocolateVanilaGreen

OriginalChocolate

Brand

Target User / Sub Brand

Usage /Promises

Product Category

Variant



CHAPTER III COMPANY PROFILE and INDUSTRY … 26619-A marketing... · Mayora Indah Tbk. PT. Mayora...

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