Portable Refrigerator

Richa SrivastavaMS11A044

MyFridge

PRODUCTSpecifications –

• Works on Compression model

• Comes bundled with an adapter

• Removable baskets instead of one deep compartment

• Inbuilt battery protection CompetitorsTROPIcool® Mobile Fridge cum Warmer – Model Godrej ChotukoolHaier portable fridge (if launched in India)

Market Research

Market share of major players

Current Big players in refrigeration industry- LG, Samsung, Haier, Whirlpool & Godrej

Only Godrej and Haier have portable fridges.

Godrej Chotukool in India Haier portable fridge in US

Government Spending in Rural

Size of Rural MarketsFMCG Rs.65000 croreAgri-inputs Rs.45000 croreDurables Rs.5000 croreAutomobiles (2 & 4 Wheelers) Rs.8000 croreClothes, footwear etc. Rs.35000 croreConstruction material Rs.15000 croreTotal Rs.173000 croreSource: CII Report (2008)

Target» Students

As per Indian government, the proportion of young people going to university will increase from 12% at present to 30% by 2025

» Rural IndiaOnly 8% penetration in rural India.

Historical data

Target» Proliferation of brands in urban» High saturation levels in urban» Greater awareness of brands in rural» Ever-growing aspirations in rural

» No brand caters to students’ needs of having a cooled drink at an affordable price 24 hrs in his room.

» Loyalty low but absence of competitors.

SWOT Analysis

StrengthsTechnological

InnovationAggressive advertising

Product range

WeaknessLonger

development cycles

Higher cost of production due to heavy advertising.

OpportunitiesRural India almost untapped

market.Growing college going student

population in the country.Low credibility of Chinese

players in the market.Changing aspirations and

income levelsPotential for servicing other

developing nations

ThreatsRegular sized fridges

New competitors.Cloning of successful

technology.Price wars with

competitors.

InternalFactors

ExternalFactors

External Factor Analysis Key External Factors Weight Rating Weighted Score

OPPORTUNITIES

1 Rural India almost untapped market. 15% 4 0.6

2 Growing college going student population in the country. 15% 4 0.6

3 Low credibility of Chinese players in the market. 9% 3 0.27

4 Changing aspirations and income levels 12% 4 0.48

THREATS

1 Regular sized fridges 8% 2 0.16

2 Cloning of successful technology. 10% 3 0.3

3 Price wars with competitors. 15% 3 0.45

4 New competitors. 8% 3 0.24

TOTAL 1 3.26

Issue Priority Matrix

Probability of Impact on Corporation

High Medium Low

Probability of

Occurrence

High

Rural India almost untapped market.

Growing college going student population in the country.

Changing aspirations and income levels

Low credibility of Chinese players in the market.

Medium

Potential for servicing other developing nations

Cloning of Successful technology

New Competitors Regular sized fridges

Price wars with competitors.

Low

Internal Factor Analysis

Key Internal Factors Weight Rating Weighted Score

STRENGTHS

1 Technological Innovation 17% 3 0.51

2 Aggressive advertising 15% 3 0.45

3 Product range 10% 3 0.3

WEAKNESSES

1 Long development cycles 15% 1 0.15

2 Higher cost of production due to heavy advertising. 20% 2 0.4

3 Setting up new distribution networks 15% 3 0.45

4 Smaller pockets 8% 3 0.24

TOTAL 0.92 2.26

IE Matrix

IFE SCORE

EFE SCORE

1234

1

2

3

IFE = 2.26EFE = 3.26

2.26, 3.26

Competitor Profile Matrix

MyFridge Godrej Chotukool

Critical Success Factors Weight RatingWeighted

Score RatingWeighted

Score

Market Share 0.15 4 0.4 4 0.4

Product Quality 0.15 3 0.36 3 0.36

Price 0.14 3 0.42 2 0.28

Advertising 0.15 3 0.24 4 0.32

Customer Loyalty 0.06 2 0.12 2 0.12

Brand Equity 0.06 2 0.12 3 0.18

Financial Position 0.12 2 0.24 4 0.48

Global Presence 0.08 1 0.12 3 0.36

R&D 0.09 3 0.12 3 0.12

Profit Margins

Total 1 2.14 2.62

TOWS matrixOrganizational Strengths• Technological Innovation• Aggressive advertising• Product range

Organizational Weaknesses• Long development cycles• Higher cost of production due to heavy

advertising.• Setting up new distribution networks

Environmental opportunities• Rural India almost untapped

market.• Growing college going student

population in the country.• Low credibility of Chinese

players in the market.• Changing aspirations and

income levels• Potential for servicing other

developing nations

• Evolving rural population and student demographics can be tapped through aggressive advertising

• R&D capabilities could be used to develop products best suited for developing and evolving geographic and demographics needs (Market and Line Expansion)

• Could focus on cutting down the development cycles.

•Could use its R&D, Product Development ,Marketing and Distribution expertise for gaining competitive advantages in developing markets

Environmental threats• Regular sized fridges• Cloning of successful

technology.• Price wars with competitors.• New competitors.

•Use early bird advantage and market knowledge to drive out the newer competitors•Use R&D capabilities and experience to shrink the cost structure in order to improve overall profitability

•Could buy out low cost competitors.

Porter’s 3 Generic strategies» The product targets

two unique segments – students and rural India.

» It is trying to achieve a balance between low cost / low pricing and unique offering.

Grand Strategy Matrix

Quadrant 2• Product

development• market

development• Market

penetration• Horizontal/

vertical integration

Rapid Market growth

Slow Market growth

Strong competitive position

Weak competitive position

MyFridge

Applications of SWOT

Conservative Strategy Aggressive Strategy

Defensive Strategy Diversification

Numerous environmental Opportunities

Major Environmental Threats

Substantial Internal Strengths

Critical Internal Weakness

MyFridge

Strategic Position and Action Evaluation Matrix

Financial Strength

Competitive Advantage

Industry Strength

Environmental Stability

Evolving Demographics and Aspirations in developing markets 4

Profit Potential 3

Growth Potential 4

Strong financials 2

Profit Margins 3

Ability to raise capital 2

Ease of exit from markets. 1

Improving trade-relations and conditions amongst economies. -2

Customers becoming increasingly price sensitive, esp in emerging economies. -1

Price war between MyFridge and competitors. -3

Increasing inflation. -4

Huge experience in innovating, producing, advertising and distributing products -1

Brand Image -1

Market Share -2

Product Quality -3

Customer Loyalty -3

Opportunities for up-sell and cross sell -4

Financial Strength

Competitive Advantage

Industry Strength

Average = 3.66

Average = 2

Average = -2.33

Average = -2.5

Strategic Position and Action Evaluation Matrix

Financial Strength

Competitive Advantage

Industry Strength

Environmental Stability

4.99, -0.5

1.33, -0.5

Competitive Advantage Indutry Strength

Environmental Stability

Financial Strength

Strategic Position and Action Evaluation Matrix

Financial Strength

Competitive Advantage

Industry Strength

Environmental Stability

Competitive Strategies» Horizontal Integration» Market Penetration» Market Development» Product Development

Environmental Threat and Opportunity Profile

Factors Opportunities and Threats

Political Opportunities: Improving Trade relations and condition amongst economics

Economical Opportunities: Evolving with the New MarketsThreats: Price wars amongst Competitors, increasing price sensitivity of consumers

Social Opportunities: Targeting the rural and studentsThreats:- Low acceptability in rural population

Technological Opportunities:- Lean Production ProcessThreats:- More efficient and lean production of Competitor

Environmental Threats:- Imitation or Substitution of the product in market at cheaper price

Strategic Advantage ProfileInternal Area Competitive Strength/Weakness

Marketing and Sales (+) Quality of products and services (-) Setting up distribution network from scratch(-) Longer time for product development

Finance (-) Weak financials(-) Cost of production can be brought further down

Operational (+) Operational efficiency from start

Strategy 1 Strategy 2 Strategy 3

Market Development stand Market Penetration stand Product Development stand

Weight AS TAS AS TAS AS TAS Strengths

Technological Innovation 17% 3 0.51 4 0.68 4 0.68Aggressive advertising 15% 3 0.45 4 0.6 4 0.6

Product range 10% 2 0.2 3 0.3 3 0.3

Weaknesses Long development cycles 15% 2 0.3 2 0.3 3 0.45

Higher cost of production due to heavy advertising. 20% 2 0.4 2 0.4 2 0.4

Setting up new distribution networks 15% 3 0.45 4 0.6 4 0.6

Smaller Pockets 0.07 3 0.21 3 0.21 3 0.21

Opportunities

Rural India almost untapped market. 15% 4 0.6 4 0.6 4 0.6

Growing college going student population in the country. 15% 4 0.6 4 0.6 4 0.6

Low credibility of Chinese players in the market. 9% 2 0.18 3 0.27 2 0.18

Changing aspirations and income levels 12% 3 0.36 3 0.36 3 0.36

Potential for servicing other developing nations 8% 3 0.24 4 0.32 2 0.16

Threats

Regular sized fridges 8% 0 0 0 0 0 0

Cloning of successful technology. 10% 1 0.1 3 0.3 3 0.3

Price wars with competitors. 15% 3 0.45 2 0.3 2 0.3New competitors. 8% 2 0.16 2 0.16 2 0.16

Sum TAS 5.21 6 5.9

QSPM

Strategy to be followed» Market penetration

˃ Increase the customer base by aggressively advertising and launching new products.

˃ Target newer geographies/ regions

Product Has foldable flaps attached so that when expanded it acts as a small table as well to facilitate dining.

Has removable baskets instead of one deep compartment to provide compartmentalization

Comes with an AC/ DC adapter so that it can be plugged into electricity when needed.

Promotion strategies» Contrary to popular belief people in Rural India

are fiercely brand loyal˃ Single Brand Villages

» Once converted, difficult to dislodge them» First mover advantages» Participate in local events/ festivals.» Participate in college fests.

Route to Brand Building in Rural» Build Customization

» Build Empathy / Relevance˃ Eg. Nokia ‘Life Tools’ for farming and rural community˃ Agri information to farmers in association with Reuters˃ Imparting of knowledge of English language to students by teaching

one new word every day

» Build Recognition˃ Rural folks understands symbols and colours better.

+ ‘Laal Sabun’ – Lifebuoy+ Peela Powder – Nirma

Distribution Strategies» Build Access

˃ Distribution in rural India is not a nightmare˃ For consumer durables reach towns with population of 50000+ and also˃ Look at opportunities in haats, melas, post offices, public distribution

system etc.

» Build word of mouth˃ Through effective communication using specific communication package

aimed at specific rural audience˃ Importance of opinion leaders˃ Educated village youth as opinion leaders˃ Women and children as demand generators˃ Customized events targeting specific groups with focused

communication

Marketing channelRural India» Rural Cinema» TV» Radio» Mass Media

Students» Multiplexes» TV» Social Media» Online

advertising» Promotion

campaigns in/ near colleges

Pricing Strategies» Low cost product» Easy affordability by both students and people

in rural India.» Profit margins low to maintain low cost

Communication StrategiesRural Communication» Keep the communication simple…

˃ No scope for gimmicks

» Take time in communicating the message˃ Quickies have no impact.

» Think in the local language to capture the local spirit in the communication aimed at specific region.

» Demonstration – a key element for success

Communication StrategiesStudent Communication» Keep the communication flashy…

˃ Lots of scope for gimmicks.

» Take less time in communicating the message˃ Long messages tend to lose out audience interest.

» Demonstration – a key element for success

Thank you....