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Presented By: Presented To:Adil Azmi Dr. P K GuptaMeenu KarmvarPuneet PanwarRaavi AgarwalTanvi Singhal
Marketing Decision for a Solar Cooking Oven
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Contents
Introduction to the case
Sales India Ltd. Introduction
Solar cooking oven- Introduction
Decision of the Management
Product Introduction Plan
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Introduction to the case
A young scientist approached Sales India Ltd,. with a prototype of a Solar Cooking Oven and sought the company's assistance in marketing the product. The. company has to make a decision whether
to take up the product in the first place and secondly, how to organize the efforts for its successful
introduction in the Indian market.
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Sales India Ltd.
A marketing organization specializing in domestic appliances Agencies of several manufacturers associated Has its sales offices in all major cities of India An example of marketing success Several manufacturers prefer to exhibit, demonstrate and
market their products through the impressive sales offices of Sales India.
Has acquired a certain good image in the market.
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Solar cooking oven- Introduction
Has been a subject of very long research and discussions especially in India.
An idea using the free and abundantly available solar energy has always had a special attraction in everyone‘s mind.
India has a special advantage of having bright and sunny days in at least eight months of the year.
An increasing cost of fuel and electricity is also a matter of concern forwarding this idea.
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Problems associated with Solar Oven Development Development of an efficient, compact and still
commercially feasible solar reflector has been the crux of the problem.
Parabolic reflectors which had good efficiency are invariably very costly.
On the other hand, plane reflectors are not so efficient in concentrating the solar energy
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New Prototype Positives & Negatives
Development of cheap parabolic reflector which could heat the water to a boiling point within half an hour.
The oven has a capacity of 3 to 5 litres and can cook any kind of food.
The arrangement of the cooking vessel is, however, a little clumsy and hence operations like stirring etc.are difficult.
It is also necessary to change the angle of the reflector as the sun rises in the sky.
The total space occupied by the apparatus is 3.5 CU.M The oven would take more time to reach boiling point of
water with intermittent clouds. It would. however, not reach 100.C if the sky is clouded continuously though thinly.
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Result of Product Testing Lab of Sales India
"The product would be ideal for boiling water or cooking foods that need no attention during cooking.
The sale price of the Oven would be Rs. 1,000/-, and if used for 4 hrs. a day, it could effect a saving of Rs, 300/- worth of fuel every year.
At best, it could be a partial substitute of other cooking equipments, “
Sales India has actually tested the prototype and found it satisfactory.
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Decision for acceptance of the product
With all the test data and results from the laboratory I would suggest Sales India to go for the product and until now no product with so much satisfactory features was available and this product could prove to be a boon for Indian households.
Our decision in respect of accepting this product for marketing through Sales India Ltd is POSITIVE and the detailed plan to introduce the product in the market is discussed next.
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Product Introduction Strategy
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Market Description
The Solar intends to target women from poor households in semi-rural villages near Delhi.
These villages range in size, from 200-500 households in small villages, and up to 1000 households in the larger towns.
According to information on wikipedia, there are more than 30 villages in the Delhi region in which to market this product.
Based on our largest market estimates and a high penetration rate assumption, our expected market demand could be as high as 12,000 stoves in the Delhi area alone
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Although men are most likely to be the primary purchasers, women in these families do the majority of the cooking and will have the most influence on purchase decisions.
Our target customers have an average income level of between Rs 100 and Rs 300 per day, and currently spend between Rs 12 and Rs 25 on cooking fuel daily.
In contrast, the solar cooker will not require any fuel, just sun, which is very abundant in Delhi
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Market Needs: Clean affordable energy for cooking Relief from indoor air pollution Cheaper solution in long run
Market Size: 2% growth rate for slum population Unorganized and ineffective government involvement Other clean energy initiatives
Market Barriers: Lack of legal status Income level: avg. income of only 100 to 300/day Infrastructure: limited space
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Target Market Our target market is women in large semi-rural villages
near Delhi (launching pilot in Mahipalpur- Rangpuri Pahari and Kishangarh-Goshala) with approximately 500-1000 households per village.
Although men are likely to be the primary purchasers, women do the cooking and will have the most influence on the purchase decision.
Our target customers currently use kerosene, woodsticks, cow dung or natural gas for cooking.
Our calculations on customer savings assumes that customers are using the cheapest fuel (natural gas, Rs 12/day.)
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Marketing Strategy The two main barriers to our business strategy are 1)
changing user behavior and 2) cost of the stoves. The pricing and promotion strategies described below are
designed to address these barriers. In addition, we plan to address the relatively short life (1 year) of our solar panels, by offering the consumer replacement panels once a year (three over the total life span of the stove).
This encourages the consumer take care of their stove, because if they need more than one replacement panel per year, they will have to pay for the cost of the additional panel.
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Product Features and Benefits
Health Benefits Prevents exposure to carbon compounds contained in
wood smoke, which are irritant and toxic. Saves people from acute respiratory infection and other
lung problems
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Environmental Benefits: No byproducts Reduces air pollution Increased moisture in cooking fuel reduces efficiency,
which is avoided in solar oven
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Cost Benefits Cooking with the soar cooking oven, the consumer on
an average saves Rs 4.5 per day. With the expected 3 year life span of the product, the
consumer would recoup the costs of the stove within nine months and save over three thousand rupees over the life of the cooker.
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Customer Value Proposition Solar cookers rely on a renewable energy source and eliminate
pollution associated with traditional stoves. These ovens are as effective and convenient to use as traditional
cooking methods. Further, these types of alternative fuel cookers enable users to reduce
daily expenditures on fuel. Reducing the financial cost and time spent collecting fuel enables users
to dedicate resources to other income-generating activities. Our solar ovens are similar to existing cooking methods so customer
acceptance of this product will not be a problem. Our innovative partnership with a local microfinance institution will
enable customers to purchase the stoves with affordable incremental payments. Through savings on fuel, customers will recoup their investment costs in nine months.
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Pricing Strategy The price of our stove is $26 (Rs1000). The margin is 86%, which appears high because labor
costs are not included in unit costs, only in overhead. Some of this margin will be used up in providing addition
panels for consecutive 3 years after the sale.
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Promotion Strategy The three parts of our promotion strategy are
Product launch Village representatives An education and awareness campaign.
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Product Launch The solar will hold a product launch event in each village
where stoves will be sold. These demonstrations will be setup under tents around the center of the village. A central station will feature cooking of traditional foods and the use of the solar cooker; these foods will then be made available for the villagers to sample on the spot. In addition to tastings, the village representatives will discuss the benefits of using a Solar stove.
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Village Representatives The Solar’s promotion strategy focuses on the use of village
representatives to educate the locals. Village representatives are local unemployed men and women who will sell stoves, help to educate the locals, and provide repair and maintenance services. Potential customers are more likely to trust local women and men in their villages, which will increase our credibility in the community.
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Education/Awareness The Solar will employ bi-monthly community cooking
demonstrations/free tastings to educate villagers and increase awareness and interest. These community events will be run by the village representatives, who will use the Solar stoves to cook different recipes for tasting. Villagers will find these educational events helpful in determining ways to more efficiently and productively use their stoves. Our Solar representatives will be available to offer technical assistance, stove troubleshooting, and advice on developing cooking methods to reduce fuel consumption.
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