Haldiram's Group - Seeking the 'Right' Marketing Mix

Group 8

Marketing Mix

PRODUCTS:

Haldiram's product range included namkeens, sweets, sharbats, bakery items, dairy products, papad and

ice-creams.

Namkeens remain the main focus area for the group contributing close to 60% of its total revenues.

Have a Nagpur unit manufactured 51 different varieties of namkeens, the Kolkata unit manufactured 37

and the Delhi unit 25

The raw materials used to prepare Namkeens are of best quality and are sourced from all over India.

Customize its products to suit the tastes and preferences of customers from different parts of India.

For example, it launched 'Murukkus,' a South Indian snack, and 'Chennai Mixture' for South Indian

customers. 'Bhelpuri,' was made for customers residing in western India.

The company offered certain products such as 'Nazarana,' 'Panchratan,' and 'Premium' gift packs only

during the festival season.

This helped Haldiram's compete effectively in a market that was flooded with a variety of snack items

in different shapes, sizes and flavors.

PLACE:

From the manufacturing unit, the company's finished goods were passed on to carrying and forwarding

(C&F) agents. C&F agents passed on the products to distributors, who shipped them to retail outlets.

C&F agents received a commission of around 5%, while distributors earned margins ranging from 8%

to 10%.

The retail outlets earned margins ranging from 14% to 30%.

Apart from the exclusive showrooms owned by Haldiram's, the products were available at

supermarkets, sweet shops, provision stores, bakeries and ice cream parlors.

The products were also available in public places such as railway stations and bus stations that

accounted for a sizeable amount of its sales.

Haldiram's also offered its products through the Internet.

The company tied up with indiatimes.com , Giftstoindia.com, giftssmashhits.com, tohfatoindia.com and

channelindia.com

This was to enable NRI’s residing abroad to send Haldiram's gift packs to specified locations in India.

PRICING:

The company's pricing strategy took into consideration the price conscious nature of consumers &

the large unorganized market it was battling

Introduced small packets of 30 grams, priced as low as Rs.5.

The company also launched namkeens in five different packs with prices varying according to

their weights.

The company increased prices only when there was increase in cost of raw materials or additional

taxes were imposed.

PROMOTION:

Magazines & print were used

Point of sales (Posters, Danglers, Buntings, Shelf Talkers)

Mailers to corporates during Diwali for bulk orders

Since namkeens were impulse purchase items, attractive packaging in different colors influenced

purchases.

Haldiram's used the latest technology (food items were packed in nitrogen filled pouches) to

increase the shelf life of its products.

While the normal shelf life of similar products was under a week, the shelf life of Haldiram's

products was about six months.

The company projected the shelf life of its products as its unique selling proposition.

Posters highlighting the shelf life of its products carried the caption 'six months on the shelf and

six seconds in your mouth.'

The company established restaurants in Nagpur and Delhi.

In Nagpur an innovative strategy was undertaken to increase its business

It facilitated people who were traveling by train through Nagpur station to order food from places

where stockists of Haldiram's Nagpur unit were located.

POSITIONING:

Haldirams had an edge over its competitiors by minimizing promotion costs.

They earned recognition both in India and abroad.

Haldirams was admitted as the member of Snack Food Association, US.

SWOT

Strength’s

1.Quality: the biggest strength of the company is the quality of the products, which is maintained and

improved over time.

2.Knowledge: Haldiram has been in this business since 1941 and over the time has gained immense knowledge

about the product and the consumer’s taste and preferences.

3.Manpower: Haldiram have a lot of support from its employees in building up quality and brand image.

4.Pricing: The prices of the products compared with the quality being offered to the consumer seem to be

quite reasonable.

5.Latest technology: Company invests a lot of money in technological development, which helps company to

remain in front of the competition.

6.Pacakaging: Haldiram is the first company to introduce proper packaging for the product and over the period

of time has improved by lot and still it’s the best.

7.Trust of the consumer: what drives the company is the trust of the consumer, which is a big motivating factor

for the company

WEAKNESSES

1. LOW ADVERTISING BUDGET: The Company spends very less in advertising and promotional scheme

compared to its competitors.

2. Too much stress on traditional Indian item

3. Internal Rivalry

4. Customer Service

OPPURTUNITIES

GROWING FOOD INDUSTRY: As the food industry is growing rapidly there are lots of opportunities for the

company to expand its market share in the future.

CHANGES IN THE CONSUMERS TASTE AND PREFERENCES: Consumers now demand more of convenience food

or packed food and snacks is the solution to the changing needs of the consumer

INCREASE IN THE MONEY INCOME LEVEL OF THE CONSUMER:As the income level of the consumer is

increasing, the consumer likes to spend more money on buying packed foodstuff.

PROSPECTS FOR EXPORT: The export market has been increasing tremendously, which brings more and more

opportunities for the company to expand their market globally.

THREATS

AVAILABLITY OF SUBSTITUTE GOODS: Biscuits, potato chips and other kinds of food items other than namkeen

can affect the demand for the namkeen in future.

HEALTH AWARENESS: As people are becoming more and more aware of being healthy the demand for savory

snacks is likely to get affected in the future.

INCREASING COMPETITION FROM INDIA AND MNC FOOD COMPANIES: With the increase in the competition

from the Indian and as well as MNCs the company needs to adopt aggressive marketing and spend more

money into advertising and promotional schemes. And at the same time innovate new products.

DRAWBACKS:

Haldiram’s started advertising their products too late and in the bargain they lost the initial advantage

of marketing. Itscompetitor’s expenditure on product promotion was much higher and it attracted the

attention of viewers.

Itscompetitor’s product range consisted of various products which appealed older as well as the

younger generation.

Company portfolio does not include western snacks.

According to media reports, Haldiram's lagged behind competitors in the area of customer service. Few

of the company's restaurants did not possess the minimum requirements, such as sufficient seating

arrangements and adequate parking lots.

Haldiram's also had to deal with problems created by spurious products.

The informal split between the 3 units also gave rise to problems. This led to competition among them

and analysts were of the opinion that the internal rivalry among its own companies maylead to dilution

of Haldiram's brand equity.

SUGGESTIONS:

Since Haldiram’s is known for its tradition, it can introduce products in the ready to eat format with

their traditional taste.

Associating itself with other bigger brands can also help strengthen their brand image.

Haldiram’s does not have any special products for the kids and teenager segment, which is a huge

potential target market.

Radio advertising can help them to penetrate into the rural areas.

Aggressive, innovative advertising to make its presence known in the market.

Haldiram’s can come up with milk related products.

They can setup mini outlets inside the multinational office complexes.