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MBA 7003
Unit title
Marketing Assignment 02
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Marketing
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MBA 7003
Table of Content
Table of Content...................................................................................................................... iv
Table of Figures......................................................................................................................vii
List of Tables ........................................................................................................................ viii
Executive Summary ................................................................................................................ ix
Abbreviations ........................................................................................................................... x
1.
Introduction ...................................................................................................................... 1
1.1
1.1.1
Vision ................................................................................................................... 2
1.1.2
Mission................................................................................................................. 3
1.1.3
1.2
2.
Acquisition ........................................................................................................................ 4
2.1
2.2
2.3
3.
Objectives.......................................................................................................................... 7
4.
Current Position of the Brand and Market size (Volume and Value) ......................... 8
4.2
4.2.1
4.3
4.4
4.5
4.6
4.6.1
5.
6.
7.
5.2
5.3
5.4
SWOT Analysis......................................................................................................... 22
5.5
TOWS Matrix............................................................................................................ 23
6.2
6.2.1
Segmenting ........................................................................................................ 26
6.2.2
Targeting ............................................................................................................ 28
6.2.3
Positioning ......................................................................................................... 29
6.3
6.4
Positioning Statement................................................................................................ 30
6.5
Product ...................................................................................................................... 31
7.2
Price........................................................................................................................... 33
7.3
Place .......................................................................................................................... 34
7.4
Promotion .................................................................................................................. 36
7.5
People ........................................................................................................................ 37
7.6
Process ....................................................................................................................... 37
7.7
7.8
8.
9.
10.
References ............................................................................................................................... 44
Table of Figures
Figure 1.1 - Business Sectors ..................................................................................................... 1
Figure 1.2 - Financial Highlights ............................................................................................... 2
Figure 1.3 - Company Structure................................................................................................. 3
Figure 2.1 - Steps for Acquisition .............................................................................................. 4
Figure 2.2 - Model for Acquisition ............................................................................................ 5
Figure 4.1 - Market Share of Main Two Players ....................................................................... 9
Figure 4.2 - Revenue Share of Main Two Players ..................................................................... 9
Figure 4.3 - Profit of Main Two Players .................................................................................. 10
Figure 4.4 - Strategy Curve of AMARON and EXIDE ........................................................... 10
Figure 4.5 - Perceptual Map..................................................................................................... 11
Figure 4.6 - Product Life Cycle of the AMARON and EXIDE ............................................... 12
Figure 4.7 - Competitor Analysis............................................................................................. 14
Figure 4.8 - Key Current Players of Battery Market ............................................................... 15
Figure 4.9 - Monthly Sales of the AMARON.......................................................................... 17
Figure 5.1 - SWOT Analysis ................................................................................................... 22
Figure 5.2 - TOWS Matrix....................................................................................................... 23
Figure 6.1 - Porters Generic Strategy ..................................................................................... 24
Figure 6.2 - Ansoff Matrix for Existing AMARON Products ................................................. 25
Figure 6.3 - Positioning Map ................................................................................................... 29
Figure 7.1 - Province Vice Main Dealer Points ....................................................................... 34
Figure 7.2 - Sample Advertisement in Rajagiriya Main Gantry .............................................. 36
Figure 7.3 - Summarized Marketing Mix ................................................................................ 38
Figure 9.1 - Performance Evaluation ....................................................................................... 43
List of Tables
Table 3.1 - Future Business Forecast of AMARON .................................................................. 7
Table 4.1 - B2B and B2C Attributes of the Consumer Behavior ............................................ 13
Table 4.2 - Battery Brands and Market Share.......................................................................... 16
Table 4.3 - Market Prices Comparison of Main Three Players ............................................... 16
Table 5.1 - Value Chain Analysis of the BCP ......................................................................... 18
Table 5.2 - PESTEL Analysis .................................................................................................. 19
Table 5.3 - Porters Five Forces Analysis ................................................................................ 21
Table 6.1 - Segmentation of the AMARON Product ............................................................... 26
Table 6.2 - Sales Contribution from the Vehicle Market......................................................... 27
Table 7.1 - Available AMARON Product ............................................................................... 32
Table 7.2 - Vehicle Registration with Vehicle Types .............................................................. 33
Table 7.3 - Price Comparison and New Price for AMARON ................................................. 34
Table 8.1 - Budget and Execution Plan ................................................................................... 40
Table 8.2 Projected Profit and Loss Statement ..................................................................... 41
Table 9.1 - KPIs for the Next Two Years ................................................................................ 42
Executive Summary
Lanka ORIX Leasing Company PLC (LOLC) has emerged as successful expanded business
entity within very short period. The company started its operation in 1980 with a partnership
of ORIX Corporation Japan. In 2010 LOLC PLC transformed as the holding company of
diversified set of companies, including financial services, information technology, fleet
management, manufacturing, trading, leisure, power generation and plantations.
In 1960 acquisitions and new beginnings as the Company acquires Hoare & Company with
Associated Battery Manufacturers (Ceylon) Ltd begins commercial production of automotive
batteries. The Non-Financial sector of the LOLC Group, led by Brown & Company PLC. The
Browns Group manufacture UK brand of EXIDE and LUCUS batteries in Sri Lanka and
Klevenberg Pvt Ltd is a subsidiary of BCP and currently selling LUCUS battery through this
company.
Sale or acquisition is a part of a business. AMARON is popular car battery brand in India.
Amara Raja Batteries Limited (ARBL), in collaboration with Johnson Controls Inc., USA.
An automotive battery is a rechargeable battery that supplies electric energy to an
automobile. In Sri Lanka, Samudhi Tyre Traders (Pvt) Ltd is selling AMARON batteries.
Due to the management dispute of the company, Browns is interested to acquire AMARON
brand to capture the huge market share with the existing market leadership.
According to the current market share analysis, 46% captured by EXIDE. Browns and
Company leads the market with EXIDE, LUCUS and DAGENITE brands. AMARON enter
in to the market with new product development and holds 22% market share from the battery
market. As per the porters generic strategy model, BCP is adopting a mass differentiation
strategy in order to gain the competitive advantage in the battery market. Ansoff matrix it is
recommended to adopt market penetration to cater existing market for next year. After one
years recommended to develop new product to cater the hybrid car market with new
development strategy.
With the perfect segmentation, targeting and positioning process and marketing mix, after the
acquisition, the company can increase market share immediately. End of two years, main
objective is to increase top-line up to Rs. 1.1 Bn and bottom line up to Rs. 152 Mn to fulfill
the final objective of the Browns Group.
International College of Business and Technology
ix
Abbreviations
ARBL
BCP
CFOR
CRM
DC
Dry Charge
FY
Financial Year
GDP
KPI
LOLC
MF
Maintenance Free
POD
Point of Different
STPL
VAT
1. Introduction
In the present dynamic business environment, only a small number of companies operate as
diversified business entities in Sri Lanka. Lanka ORIX Leasing Company PLC(LOLC) has
arisen as successful expanded business entity within very short period. The company started
its operation in 1980 with a partnership of ORIX Corporation Japan. In 2010 LOLC PLC
transformed as the holding company of diversified set of companies, including financial
services, information technology, fleet management, manufacturing, trading, leisure, power
generation and plantation. The LOLC Group comprises of 87 divisions, 19 joint venture
companies and 11 equity accounted associates. The consolidated total assets of the LOLC
Group as at 30th March 2016 were Rs.379 Bn and the total equity of the Group was Rs. 57
Bn. Figure 1.1 depicts business areas of the LOLC Group. The Brown & Company PLC is a
subsidiary of the LOLC Group with 54.54% Control holding.
Figure 1.1 - Business Sectors
LOLC Group
Financial
Services
Agriculture
&
Plantations
Renewable
Energy
Leisure
Construction
Manufacturin
g & Trading
Informatio
n Services
1.1
In 1960 the company acquires Hoare & Company with Associated Battery Manufacturers
(Ceylon) Ltd, commence commercial production of automotive batteries. The Non-Financial
sector of the LOLC Group, led by Brown & Company PLC and Browns Investment PLC,
strengthened its position by tapping into new customer segments and further diversifying its
product range post strategic restructuring in 2014. Browns group is the only battery
manufacturer in Sri Lanka. The Browns Group manufacture UK brand of EXIDE and
LUCUS batteries in Sri Lanka. Apart from Browns brands, AMARON, Yuasa, and Inco,
Global are playing key role in the battery market. India, China, Korea and Indonesia are main
importers of foreign batteries. Figure 1.2 depicts financial highlights of the BCP. EXIDE has
more than 800 dealers Network Island wide and out of it 268 maintains exclusivity.
1.1.1 Vision
To be a leading Sri Lankan conglomerate excelling through sunshine industries with a global
presence and cutting edge technology.
1.1.2 Mission
With generations of trust and reliability, our aim is to continuously enhance the value
propositions to our stakeholders through innovative and customer-centric solutions.
1.2
Klevenberg Pvt Ltd is a subsidiary of BCP and currently selling LUCUS battery through this
company.
2. Acquisition
Sale or acquisition is a part of a business. The acquisition can divide in to main two
categories such as brand acquisition and company acquisition. Due to various reasons,
company perform acquisitions with the intention of develop the business. Before acquire a
band or company required to evaluate three things. The first step is to incorporate a brand
assessment into the due diligence process. The main target of brand assessment is to
understand about fundamental value/potential baggage of the acquisition. Once developed a
baseline understanding of the brand and product current position, required to evaluate
tangible assets, operations, financials etc. If the evaluation stage indications to move forward
with the acquisition, need to finalize proper transition plan.
Following model can be used for brand acquisition and AMARON acquisition falling under
Segment and attractive brand category. Main target is to increase the profit share of the
company from the battery segment.
2.1
Brand - AMARON
AMARON is popular car battery brand in India and Amara Raja Batteries Limited (ARBL),
in collaboration with Johnson Controls Inc. United States. ARBL is the largest manufacturer
of batteries in the Indian Ocean Rim region.
2.2
Product - Battery
2.3
In Sri Lanka, Samudhi Tyre Traders (Pvt) Ltd is selling AMARON batteries. Samudhi Tyre
Traders (Pvt) Ltd is a small company in Colombo, Sri Lanka and import AMARON batteries
from India. They have only 15 main dealers in Central Province, Noth Western Province,
Southern Province, Sabaragamuwa Province and Western province.
Due to the management dispute of the company, Indian manufacture ARBL is looking for
another company to continue future imports and business. The management of the Samudhi
Tyre Traders (Pvt) Ltd also offering to sell AMARON brand for Sri Lankan company. BCP is
interested to acquire AMARON brand to capture the huge market share with the existing
market leadership.
Due to the agreement sign by Browns and EXIDE, BCP cannot acquire AMARON brand
directly from the STPL. Therefore, recommended to acquire AMARON brand through the
Klevenberg Pvt Ltd.
3. Objectives
Objective is to provide marketing perspective to the consultation team with two years of
future cash flows via a well-constructed marketing plan. This marketing plan is given to
achieve 29% market share with Rs. 1 Bn turnover within next two years. Table 3.1 shows
future forecast with units, market share, revenue and profit.
FY
Units
Market
Share
Revenue
(Rs.Mn)
Profit
(Rs.Mn)
Previous
Year
2015/16
143,916
22%
814
116
This Year
2016/17
156,999
24%
912
125
1st Year
2017/18
170,083
26%
1,003
138
2nd Year
2018/19
189,707
29%
1,103
152
4.1
Current Position of the Brand and Market size (Volume and Value)
The current market can divide into few sections of automotive, non-automotive and
motorcycle batteries. Approx. 60,000 batteries are being replaced every month in Sri Lanka.
6.5 Mn
10%
Current market leader holds 46% of the market share and AMARON holds 22% market share
of the battery industry. 1 in 2 households have motorized transport of the country. With the
acquisition of the AMARON brand Browns will hold 75% of the market with the 7% market
share of the LUCUS battery. Figure 4.1 depicts the market share analysis of main two
players. Figure 4.2 depicts the revenue share of EXIDE and AMARON. Figure 4.3 shows
profit distribution from 2011 to 2016. According to the current situation analysis, AMARAN
grab the market share very fast and decreasing from 2015. comparing to the 2011, AMARON
captured huge market share from the existing market.
50.50%
46.00%
50.00%
46.00%
42.00%
37.00%
EXIDE
40.00%
Market Share
Volume (Exide)
30.00%
30.00%
20.00%
23.00%
22.00%
17.00%
10.00%
10.00%
8.00%
0.00%
2010/11
2011/12
2012/13 2013/14
Year
2014/15
2015/16
2000
1961
1923
1703
1500
1702
1400
1295
1000
1,050
500
629
311
2010/11
814
767
381
2011/12
2012/13
2013/14
2014/15
2015/16
381
350
366
300
277
260
250
205
200
150
100
50
96
60
72
2010/11
2011/12
218
177
132
112
2012/13
2013/14
2014/15
2015/16
4.2
Strategy Curve
According to the strategic cove of main two players in the industry, the management can fine
tune values accordingly. Need to improve after sales service of the AMARON battery. Those
are the key area to focus in future business. Figure 4.4 shows strategy cove of main players.
Figure 4.4 - Strategy Curve of AMARON and EXIDE
Customer perception on after sales, delivery reliance, price and technical quality were
measured for EXIDE and its main competitor AMARON. Customers recognize EXIDEs
name, it is after sales service and delivery reliance above AMARON, but in quality and price
are higher in AMARON than EXIDE.Figure 4.5 dipects perceptual map for baterry industry.
EXIDE
AMARON
4.3
Consumer Behavior
As a business very important to understand the consumer behavior of the business, it will
help to meet consumer needs effectively. Table 4.1 depicts the B2B and B2C attributes of the
consumer behavior.
4.4
Competitor Analysis
There are few main players in the battery industry. BCP plays major role in the market. They
have already captured huge market through the EXIDE and LUCUS brands. With the
acquisition of the AMARON brand no major players to compete with them. Figure 4.7
shows, direct and indirect competitors of the market.
Indirect Competition
\
4.5
According to the current market share analysis, 46% holds by EXIDE and Browns leads the
market with EXIDE, LUCUS and DAGENITE brands. AMARON enter in to the market with
new product development and holds 22% market share from the battery market. Figure 4.8
and Table 4.2 shows key current players of the battery market with their market share.
Dagenit Others
2%
3%
Yuasa
5%
Lucas
7%
Exide
46%
Panasonic
8%
Amaron
22%
Market Share
46%
22%
8%
7%
5%
4%
3%
2%
3%
According to the table BCP provides UK brands from Sri Lanka. They import only 30% of
raw materials and manufactured in Sri Lanka.
4.6
Current Pricing
Due to the government taxes, imported batteries are more expensive than the local batteries.
Table 4.3 depicts the current market prices of main three players in the industry.
EXIDE
12V 100Ah
12V 150Ah
12V 100Ah
12V 40Ah
12V 140Ah
12V 140Ah
12V 74Ah
12V 75Ah
12V 85Ah
12V 70Ah
12V 45Ah
12V 35Ah
12V 9Ah
Source: Industry Date
53,191
33,316
33,232
26,752
26,735
26,735
26,248
19,940
19,940
18,960
11,820
10,560
4,945
LUCUS
54,255
33,982
33,897
27,287
27,270
27,270
26,773
20,339
20,339
19,339
12,056
10,771
5,044
AMARON
55,851
34,982
34,894
28,090
28,072
28,072
27,560
20,937
20,937
19,908
12,411
11,088
5,192
15,000
16,000
14,800
13,000
12,000
12,000
7,500
8,000
4,000
Jan-16
Feb-16
Mar-16
Apr-16
May-16
Jun-16
Jul-16
5. Environmental Analysis
To prepare a good marketing plan, required to analysis internal and external environment of
the company and the product. Recommended to use value chain analysis, PESTEL model
and Porters Five Forces Analysis for environmental analysis.
5.1
Value chain analysis is used to analyses the internal environment of the business, Table 5.1
shows value chain analysis of the BCP.
Inbound Logistics
Operations
Details
Service
5.2
PESTEL Analysis
PESTEL stands for political, economical, social, technological, environmental and legal and
forms of analysis of the macro-environment of the organization (Thomas, 2007). Table 5.2
depicts PESTEL Analysis of the BCP.
Political
Economical
Social
Technological
Environmental
Legal changes can affect a firms costs such as if new structures and procedures
have to be developed, the firms cost can be increased.
Sometimes laws effect on the customers. In those cases, buying decision of
goods, the demand of a product may change significantly. Because in the end
its the customer who decide to buy or reject.
5.3
Porter's five forces analysis is a framework that can be used to analyze the level of
competition within an industry/market and business strategy development. Table 5.3 shows
ranking of the porters five forces analysis.
Rank
High
Threat of substitutes
High
Medium
Medium
High
Industry Rivalry
Source: External Analysis
5.4
SWOT Analysis
Through this model the management can understand strength, weaknesses, opportunities and
threats as an outcome of internal and external analysis. This model will help to identify the
current position of the organization and attention required area to sustain the future business.
Further it will help to improve the future forecast and business. Figure 5.1 shows SWOT
analysis.
Weaknesses
Opportunities
Threats
5.5
TOWS Matrix
This tool helps to convert the weaknesses to strengths, threats to opportunities and grab the
opportunities by using current strengths. S-O strategies use to grab the opportunities by using
current strength of the company. W-O strategies use to overcome weaknesses via
opportunities. S-T strategies classify possible ways to use company strengths to decrease
vulnerability to external threats and finally, W-T strategies make a defensive plan to prevent
the firms weaknesses from marking it susceptible to external threats. Figure 5.2 depicts
TWOS matrix.
TOWS
SO(Strategies)
Opportunities
Browns
WO(Strategies)
ST(Strategies)
Threats
Weaknesses
WT(Strategies)
With the huge market share of the Diversify the business for energy
company, competitors cannot attack
sector as defensive strategy for
hybrid vehicle battery life time.
Increase the awareness of the
Browns products
Protect the new market entrance
with the huge market share
With Group, IT company support
will help to increase the electronic Increase local manufacturing to
marketing
remove the import tax as long run
6. Marketing Strategy
After the acquisition with the strong dealer network of the Browns, required to develop good
marketing strategy to increase the top line, bottom line and market share of the product.
Porters Generic Strategy used for marketing strategy. Figure 6.1 shows Porters Generic
Strategy model for AMARON.
As per the porters generic strategy model, BCP is adopting a mass differentiation strategy in
order to gain the competitive advantage in the battery market. AMARON is a result of mass
differentiation in the technology and it will grab the market with the maintenance free
concept. Therefor it is recommended to continue the same differentiation strategy for the next
two years in the market.
6.1
Ansoff matrix use to analysis the market with products. The company can choose market
penetration, product development, market development or diversification for marketing
strategy. Figure 6.2 depicts Ansoff matrix for MARON product.
Year 1
Year 2
6.2
6.2.1 Segmenting
Table 6.1 depicts segmentation of the AMARON product market is depicted in table
Table 6.1 - Segmentation of the AMARON Product
Segment-1
Segment-2
Segment-3
Segment-4
Segment-5
Vehicles
including
hybrids
Energy(Solar
power)
Generators
Garages /
vehicle service
centers
Invertors
Geographic
Area
All provinces
of Sri Lanka
All provinces
of Sri Lanka
Western
province,
North western
province,
Central &
Southern
provinces
Climate
All
Dry zone
All
All
All
above 20 to
55
above 35 to
65
N/A
N/A
N/A
Male &
Female
Male &
Female
Limited
Liabilities /
Partnerships
Limited
Liabilities /
Partnerships
N/A
Above
30,000/-
Above
100,000
Above
1,00,000/-
1,000,000/and above
25,000 and
above
All
Upper and
Upper Middle
Class
Upper and
Upper Middle
Class
N/A
Middle Class
and Low Class
Strivers /
Achievers
Achievers
Achievers
N/A
Strivers /
Achievers
All provinces
of Sri Lanka
North Central
province,
Eastern
province and
northern
province
Demographic
Age
Gender
Nature
Monthly Gross
Income
/
Turnover
Psychographic
Social class
Life Style
All
Ambitious
Aggressive
Very
Aggressive
Ambitious
Convenience
Convenience
Convenience
Reliability
Convenience
User Status
Regular
Regular
Regular
Regular
Regular
Readiness
Cautious &
Aware
Aware
Aware &
Interested
Informed &
Aware
Cautious and
Aware
Personality
Behavioral
Benefits
Under segment 1 mention in the above table 6.1, vehicle market can categorize further
according to the vehicle categories. Table 6.2 shows sales contribution against each vehicle
segment.
Sales Contribution
Cars
14%
14%
Commercial vehicles
18%
3-wheelers
20%
8%
Marine
4%
Motor cycles
12%
Generators
2%
2%
Farm Vehicles
6%
6.2.2 Targeting
Based on the current developments and trends in the market segment 3 indicates the highest
attractiveness to the AMARON, MF batteries in the current market. However due to the
financial position of the STPL, unable to grow their business. With acquisition of BCP can
grow further with the financial strength of the Group. AMARON can be focused to segment
2, segment 3 and segment 5 as well. It is recommended to select the segment 1 (vehicle
market) and Segment 4 (business sector) as the target market for AMARON.
Targeting Approach
Undifferentiated
Marketing
Differentiated Marketing
Concentrated Marketing
AMARON has to focus two marketing segments at once as the target market for AMARON
and recommended to adopt penetration approach sine AMORON has the MF quality product
to serving needs of selected segments a short term and medium term Working Capital
solution. After one-year company can target new AMARON HYBRID product to cater the
battery requirement of hybrid vehicles.
6.2.3 Positioning
According to the segmentation and positioning, figure 6.3 depicts positioning map. Through
the differentiation method target the above segments and position the quality and price high
area.
6.3
(CFOR)
Maintenance free battery
Old
New
6.4
Positioning Statement
To all vehicle users who need fast solution for vehicle battery,
Browns provide the fastest solution for your requirement
6.5
Consumers who are with Browns, you can enjoy superior experienced and reliable service
form the Browns outlet all over the country. Majority of the AMARON customers are from
Colombo and Gampaha district. Browns will cover entire country with the strong dealer
network of the Browns group.
7. Marketing Mix
Required to implement marketing plan with good marketing MIX. Through this section
further describe about product, price, place, promotion, people, process and physical evidence
of the AMARON brand.
7.1
Product
Browns can market AMARON, EXIDE and LUCUS for entire battery market. EXIDE and
LUCUS more familiar for DC or Lithium Cadmium battery. AMARON is more famous for
MF batteries. To take more advantages, recommended to provide all range of batteries to
cater the market for same voltage with different amperes. Currently more focus to provide
high ampere range batteries for heavy vehicles. Will focus two wheelers and three-wheelers
as well. Recommended to import 2.5 Ah, 5.0 Ah and 9Ah for two wheelers and 35 Ah for
three wheelers. Recommended to release battery testers free of charge for main dealers.
Among vehicle segments of batteries, sales of marine segment and motor bike segment can
be further improved. Marine segment contributes only 4% of total sales. Approximately
51,000 registered boats are there. Price of boat batteries varies from Rs.20,000 Rs. 50,000,
price high, profit margin also high. There are 437 fisheries co-operative societies and twelve
fishing harbors are located island wide. Proposes to promote boat batteries via fisheries coop
societies with installment payment plan. Table 7.1 shows, available AMARON product in the
market.
Details
Labels
Passenger Vehicles
(2 1/2 Yrs FULL WARRANTY
+ 2 1/2 Yrs PRO RATA BASIS)
(2 Yrs FULL WARRANTY
+ 2 Yrs PRO RATA BASIS)
(2 Yrs FULL WARRANTY
+ 1 Yrs PRO RATA BASIS)
(1 1/2 Yr FULL WARRANTY)
(1 Yr FULL WARRANTY)
Commercial Vehicles
(1 1/2 Yrs FULL WARRANTY
+ 6 Months PRO RATA BASIS)
Farm Vehicles
1 1/2 Yrs FULL WARRANTY +
6 Months PRO RATA BASIS
Two Wheelers
2 Yrs FULL WARRANTY
Source: Internet
Currently motor bike batteries are marketed via distribution channel. The company grant 2025% margin for distributor and dealer get only 5-10%. Dealers are not motivated to sell
batteries with small discount rate. Proposed to increase motor bike battery sales is directly
supply to dealers with 30% discount. Figure 7.2 shows total vehicle registration with vehicle
types. Highest number of vehicle on roads are motor bike. Therefore, with the above
International College of Business and Technology
32
mentioned percentages, expected revenue growth is 25% from the total sales. Considering
battery replacements after three years, captured only up to 2013 vehicle registrations. This is
the actual target market for batteries.
7.2
Price
Compare to the market prices EXIDE maintains low price. AMARON more than 5% - 7%
increase of their prices. Recommended to reduce prices from 1% and market it with
AMARON and browns brand name. With the two year and three-year warranty feature,
distributers can market AMARON batteries for their consumers. Figure 7.3 depicts price
comparison and new price for AMARON
7.3
EXIDE
53,191
33,316
33,232
26,752
26,735
26,735
26,248
19,940
19,940
18,960
11,820
10,560
4,945
LUCUS
54,255
33,982
33,897
27,287
27,270
27,270
26,773
20,339
20,339
19,339
12,056
10,771
5,044
AMARON
55,851
34,982
34,894
28,090
28,072
28,072
27,560
20,937
20,937
19,908
12,411
11,088
5,192
Place
With more than 800 dealer network, proposed to market AMARON battery for entire market.
If the market captured by the EXIDE, not going to sell AMARON brand for these locations.
All province will be captured for vehicles, solar and vehicle service centers including
garages. Western province, North Western province, Central & Southern provinces will be
captured for generator batteries and North Central province, Eastern province and Northern
province captured for invertor battery market. Figure 7.1 shows, province vice main dealer
points.
Central Province
Sabaragamuwa Province
Uwa Province
Eastern Province
Western Province
Southern Province
7.4
Promotion
EXIDE promote more than the LUCUS, recommended to promote AMARON with Browns
name to aware the acquisition for the entire country. STPL promote their brand with 250
distribution channel but with the Browns distributor network, BCP can cover huge
geographical area than STPL. Recommended to use ATL marketing through Television,
radio (Gold FM, EFM, Sha and Sirasa FM) and other electronic media such as Facebook and
twitter. BTL through Handouts, Broachers, leaflets, Branch Displays and e-Fliers. In addition
to that recommended to use direct marketing, public promotions, sales promotions during
first three months and reduce to once in two-week basis. Important to promote AMARON
name with the Browns name to grab the attraction of the people. There are three main gantry
points in Colombo. Recommended to advertise on those boards (Dehiwala, Paliyagoda and
Rajagiriya) to grab attention. Figure 7.2 shows, sample advertisement in Rajagiriya main
gantry.
7.5
People
All people can directly or indirectly influence for the product or service, including knowledge
workers, management, employees and consumers. Recommended to arrange large workshop
for all distributers and employees to share the product details and future progress of the
product. Increase the incentives for dealers and distributors. Arrange awareness session for
consumers as well.
7.6
Process
Well monitored process needed with proper quality control. Required to increase quality
control parameters, replace old equipments such as voltage meters and ampere meters.
Increase the efficiency via proper stock management system. Recommended to obtain ISO
quality endorsements for Browns products. Need to increase after sales service through
BATT mobile process enhancements.
7.7
Physical Evidence
The direct physical experience of a product that permits customer to measure whether
customer has established the value. With the battery recommended to handover information
booklet to improve the awareness about the product. Specially charging and vehicle alternate
outputs.
Figure 7.3 shows the sumarized marketing mix importantlly with 3Ps.
7.8
Execution plan
With 46 % current market share and 22% AMARON market share BCP holds major share
from the battery market. Last two to three years Sri Lanka imports vehicle from Japan and
India. At the moment 6.5 Mn registered vehicles are available in the country and more than 5
Mn vehicles were available in 2013. After 2-3 years, required to replace vehicle battery. Main
objective is to target that market and enhance the business.
1. Required to conduct massive marketing camping to spread the acquisition awareness
2. Add all AMARON brands to Browns web site and relevant e-business sites such as
wow.lk, ikman.lk, etc.
3. Educate dealers and distributors
4. Reduce the AMARON current market price from 1%
5. Target to spread AMARON for all over the country
6. Promote AMARON batteries via TV and Radio advertisements
7. Conduct hand bill campaigns and conduct the battery clinic workshops
8. Display Browns battery boards in spare part shops
9. Import new product after one-year time to fulfill the hybrid battery requirement.
10. Advertise new product with new name AMARON HYBRID for Sri Lankan market
11. Provide battery testers free of charge for main dealers
12. Arrange dealer convention of the year end
13. Conduct CSR activates in third equator of each year
14. Arrange handbill distribution campaign continuously
15. Target the vehicle registration offices to obtain the statistic and identify vehicle
registrations to conduct the promotions.
Total
Budget
2017/18
10,000,000,000
15,000,000,000
6,000,000,000
500,000
3,000,000,000
5,000,000,000
1,000,000,000
3,000,000,000
2,000,000,000
3,000,000,000
2,500,000,000
1,000,000,000
51,500,500,000
2017/18
2018/19
Budget
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2018/19
1,000,000,000
20,000,000,000
7,000,000,000
700,000
4,000,000,000
7,500,000,000
2,000,000,000
5,000,000,000
4,000,000,000
2,000,000,000
3,000,000,000
3,000,000,000
2,000,000,000
60,500,700,000
8.1
Projected Financials
Table 8.2 depicts the projected profit and loss statement for AMARON batteries for next two
financial years.
1,003.00
(20.06)
(787.36)
195.59
1,103.00
(22.06)
(860.34)
220.60
Expenses
Brand acquisition campaign
ATL 5 Second advertisements
Advertising on gantry points
CSR campaign
Warranty extensions
Dealer Convention
online advertising
Hybrid battery promotion
Handouts
Broachers
Banners for spare part shops
Leaflets
Public promotions
Utility Expenses
Statuary payments
Total Expenses
(10.00)
(15.00)
(6.00)
(0.001)
(3.00)
(5.00)
(1.00)
(3.00)
(2.00)
(3.00)
(2.50)
(1.00)
(2.00)
(4.00)
(57.50)
(1.00)
(20.00)
(7.00)
(0.001)
(4.00)
(7.50)
(2.00)
(5.00)
(4.00)
(2.00)
(3.00)
(3.00)
(2.00)
(3.00)
(5.10)
(68.60)
138.08
152.00
2.
As at 31/03/2018
As at 31/03/2019
Rs.1 Billion
Rs.1.1 Billion
138 MN
150 Mn
2 % increase
3% increase
Brand awareness
50%
75%
Distributor Network
950
1,100
Turnover
Profit
Market Share
According to the figure 9.1 the management can evaluate the performance of the AMARON
and identify the achievement of the company objectives.
10. Conclusion
Two years marketing plan is prepared to increase company profit which is generated from the
battery market. After the acquisition, company market share increased up to 68%. End of two
years, main target is increase top-line up to Rs. 1.1 Bn and bottom line Rs. 152 Mn. Strategic
decision is incorporated for differentiation strategy in the Ansoff matrix to successful the
acquisition.
References
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(2016). Amara
Raja
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[online]
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