Evaluation Of New Product Ideas

Published Date: 02 Nov 2017

Idea screening is used to evaluate innovative product ideas, strategies and marketing trends. The potential ideas which match the firms’ skills and competencies are selected and whatever does not meet these measures are discarded. This process is used to determine compatibility with overall business objectives and whether the idea would offer a feasible return on investment.

3.1 Idea screening types

There are six types of screening methods proposed by Kucsmarski, namely growth role, category screens, strategic roles, new product strategy, internal strength and financial risks. From these methods we used four methods which are appropriate and important to our ideas. (Chapter one, n.d.).

3.1.1 Growth role

Daintee has the goal of growth in terms of its products. So the growth role screening type is considered. Energize will create a whole new category of product market. It will expand the sales strategically and increase the market share of Daintee. This can help Daintee to be the market leader of the confectionary industry. The new product Energize, energy boost sugar free flavored toffee will ultimately enhance the company portfolio by entering in to the Sri Lankan market.

3.1.2 Strategic role

Strategic role is where we define competitive, market and business requirements that new product is expected to satisfy. Existing manufacturing, distribution, delivery, marketing and sales efforts of Daintee can be used for Energize because Daintee is already producing toffees and sugar free products. So the manufacturing machineries and some ingredients can be used to produce Energize. And Daintee is distributing and marketing its current products to the whole Sri Lanka. So Energize has the advantage of using the same services for a lower cost.

3.1.3 New product type

Energize energy boost toffee will be a total new product concept to the Sri Lankan market, because the customers have never experienced such a product ever in their lives. Industry information was easily available but the technical and financial information were hard to find because there are no close competitors in the market. Daintee will be the first to introduce such a concept to the market.

3.1.4 Internal strengths

Since Energize is a new product and the product concept is totally new, even to the world, there will be some difficulties while marketing and boosting its sales. But Daintee is a well-established company with a strong brand identity. So we believe that through capitalizing existing marketing and sales efforts of Daintee, Energize will also be able to build its recognition under the Daintee name.

3.2 Evaluation of new product ideas

These are the product ideas we came up throughout the brain storming session and the reasons for the acceptance or rejection of those ideas.

Energy booster chocolate bar – this idea was already available in the foreign markets. Especially sportsmen and soldiers use this product. Acai, CocoaWell and Recharge are some of the brands which have energy boost chocolates in their product ranges. So we decided to reject this idea.

Energy booster chewing gum – this product is also available in the foreign markets. We came up with this product idea by looking at the people’s higher preference rate for chewing gums and usage convenience of the product, but since it’s available in the global market we decided to reject the idea.

Flavored water – flavored water is not available in Sri Lankan market. But it is in the global market. Also we felt that Sri Lankan people might not give much preference to flavored water over natural water due to their beliefs and values. So we rejected this product idea.

Packed instant cake mixture- since it’s a cake we felt like it won’t be unique. Also according to Sri Lankan culture instant products are not highly appreciated. They believe in the long process of making cakes. So we rejected this idea.

Fresh soup powder –we’ll have to use lots of essence to make this and it will be a health issue. The powder should be fresh and we have to conduct long term researches to finalize this product. Since we have only four months to complete this assignment it was not a good idea. And also Unilever’s are importing some mixtures which go with the concept. So we dropped this idea as well.

Fruit booster– when making a fruit booster we have to include vitamins and some supplements and for that we have to do a long research and around four months are not enough for that so it won’t be practical in short term. And similar products are available in the market now so we had to drop the topic.

Spices with vitamins – we have to conduct several medical tests to finalize this product. Such as vitamin selections and additions. Since we have a limited time period we rejected this idea.

Health powder- small domestic companies in Sri Lanka are already manufacturing similar products for health powder. We decided to reject idea because it will not be a unique idea.

Flavored curd – curd has a unique taste itself and people in Sri Lanka prefer that taste. We felt that people would not like to taste different flavors of curd. Also flavored yogurt is already in the Sri Lankan market. We decided that this couldn’t be our product.

Bottled Dooriyan drink- dooriyan fruit is very thick and it will be hard to make a juice out of that and lots of people don’t like the smell of dooriyan and it won’t be a popular drink.

Energy boost sugar free flavoured toffee was finally selected as the best product idea. The uniqueness and features of this toffee will benefit to make it a successful product with the use of the skills and competencies of the Daintee Company. The sugar free, energy boosting toffee which has different flavours is a unique idea which is not yet available in the local and foreign markets.

4.0 Concept development

Concept development is the next step and in this stage we have to do all the qualitative improvements of the selected concept. We conducted an in-depth research and logically thought for more developments and filtered down a clear specific concept. Through development we believe to communicate the new product, its promotions, provide assured benefits...etc.…

We believe that the concept developed is achievable and this would be a profit generating project. Energize will take a step forward in setting the mark in the food & beverage industry. Energize energy boost toffee will have first mover advantages and Daintee will be the first company to introduce energy boost toffee to Sri Lankan market as well as to the world.

The concept is an energy boost toffee and it will be sugar free and also will have different flavors. The toffee will be available all around Sri Lanka. People will be able to buy this product as a single toffee, toffee card and as a toffee tin. The price will be low and affordable compared to other available energy drinks. And Energize will give quick and guaranteed results.

The development process will be showed in a diagram as presented below to gain a better understanding.

5.0 Concept testing

For early identification of potentially successful products concept testing is used. It considers customer reaction to a basic idea of the product, helping decision making such as pass/fail or go/no go. It occurs before a product is marketed. Therefore, while promising a high likelihood of consumer acceptance, the attempt minimizes research and development costs and marketing costs. Concept testing is used to finalize the ideal market to host the product when choosing among substitute concepts; it ensures that the selected concept is most suitable. Also it positions the establishment upon which benchmarking can be executed in the future. The effort aids to bring together new ideas into the concept. It estimates the demand and analyses whether the product is actually ready to be launched. The process of concept testing should be considered as a mechanism to refine, develop and nurture new ideas, hence increasing their chance to penetrate the market successfully. (Concept testing, n.d.).

5.1 Problem definition

5.1.1 Decision problem

The key decision, which required to be addressed, was if the innovative new addition to toffee should be launched in to the food and beverage market and to find out if Daintee should expand its product portfolio and launch this product to the Sri Lankan food and beverage market.

5.1.2 Research problem

This is to identify whether the target customers would accept Energize energy boost toffee or not.

5.2 Research objectives

The key research objectives were identified as;

Recognizing the perception of the target market.

Identify customer’s view about this new product.

Understand market potential for the new market.

Identifying the expectations of the target market.

Identify areas that should be developed in the future.

5.3 Research methodology

To evaluate the market characteristics and product feasibility we have implemented an integrated strategy to collect reliable information using both primary and secondary methods

Primary data collection

The primary data was collected using quantitative and qualitative tools. A survey consisting of a questionnaire was used in this process. Statistical information of the market situation and the preferences were found out through the help of quantitative data which was used to evaluate the feasibility of the product. Qualitative data was important in perfecting the product making necessary modifications to assure its success in the market.

Secondary data collection

Websites, magazines, newspapers and other sources were used to collect secondary data.

5.3.1 Sample framework

The research sample included respondents from teenagers to young adults especially who are in to sports and with busy working schedules, university students and health conscious people who are concerned about their sugar and calorie intake. These respondents were mainly chosen from locations including Colombo, Kandy, Kurunagala, Mathale, Katunayake, Kaluthara, Nuwaraeliya …etc…

5.3.2 Sampling Methodology and tools used

A detailed questionnaire was the main instrument used to gather primary data which included a set of relevant and essential questions. This was mainly built on the lines of identifying the degree of acceptance for our product. This document contained 16 questions. 1 was an open ended and the remaining questions were close ended. These were distributed among the above mentioned people in certain geographical locations. (Refer Appendix 1)

6.0 Business analysis

6.1 Market size potential

After analyzing the information we gathered from the questionnaire we found out that most people prefer to use energy boost products and a higher percentage of them liked the concept of energy boost toffee. These facts confirm that we have a large potential market and the idea of producing different flavors of the ‘Energize’ will attract more customers because according to the questionnaire people like to consume flavored products. And the sugar free attribute will also increase the demand for the ‘Energize’, because figure conscious people and diabetic patients can use this toffee to boost their energy. All these evidences prove that ‘Energize’ energy boost toffee will have a higher demand in the market.

6.2 Time

We are expecting to launch ‘Energize’ within a period of nine months. Energy boost drinks, such as Redbull, Wild elephant, Blu…etc… are currently in the Sri Lankan market but other energy boost products such as energy boost chewing gum, chocolate…etc… are available in the global market but not in the Sri Lankan market. And ‘Energize’ energy boost toffee will be a complete new product to both global and local markets. So there will not be any direct competitors. And we will carry out a strong IMC campaign to face to the indirect competition and increase the product awareness. Also we will apply for the standards such as SLS. Throughout these nine months we will take necessary actions to make this product successful and complete the stated goals and objectives to gain productive results.

6.3 Risks

To study the risks of the industry we have conducted Porter’s five fore analyses as below. (Porter's Model, 2009) (Refer appendix 3)

Bargaining power of Suppliers

In production, the main ingredients for toffee are Sugar, Butter and at sometimes Flour. However the specialty of our product is that it is an energy boost toffee. We are planning to use a little amount of cocoa, vitamins like vitamin E, B6, B12 and minerals to create this specialty. Since ‘Energize’ is also a sugar free toffee with different flavors we are planning to use natural sweeteners like Stevia, Xylitol and Erythritol which are derived from plants and fruits and other healthy flavors. Except for the sugar free ingredients, all the other inputs can be easily found in Sri Lanka.

This is not a major concern because there are number of suppliers who can supply Stevia and Enrythol especially in countries like China, Thailand, Hong Kong…etc... Because the plants used to make organic stevia are grown without the use of pesticides or chemical fertilizers and in these countries they are grown for mass production. So the bargaining power of the suppliers for ‘Energize’ can be identified as positively low. (Cespedes, 2011)

Bargaining power of Buyers

The bargaining power of the buyers is relatively low for the ‘Energize’ because they can buy a unique product which has many benefits for a favorable price. ‘Energize’ will be higher than the normal toffees in the market but it will be much lower than an energy boost drink or an energy boost chocolate. So customers can gain the advantage of consuming energy boost toffee for a lower price. Not only the price benefit, they can also select any preferred flavor of the ‘Energize’. Since we are planning to make ‘Energize’ available all around in Sri Lanka it will be another added advantage to reduce the bargaining power of the buyers.

Threat of substitutes

Toffees in general have a lot of substitutes. If there are many substitutes available the potential profit is at risk, because the customer switching cost is low. The toffee industry must compete with number substitutes which include chocolate, chewing gum, and also some kinds of peanuts and especially the Center fruit, Center Fresh range which has captured the majority of the local market share.

There are no close substitutes for the ‘Energize’. There are number of regular toffees, sugar free products and flavored toffees available in the market as we mentioned above, but there is no such a product which has all three qualities. So the threat of substitutes will be low for ‘Energize’.

Threat of new Entrants

There are no any dominant players in the Sri Lankan toffee market except for some companies like Delta and Happy Dent who are marketing the Center Fruit and Fresh range. There are less entry barriers for the toffee industry even a smaller enterprise can enter into the market and dominate demographic regions.

Since this is a totally new product to the market we will first get the patent license and all other legal requirements to avoid copping energy boost, sugar free flavored toffees. So the threat of new entrants will be low for our product.

Industry rivalry

Price wars, advertising battles, new product lines, and higher quality of customer service are some of the areas where competitors create industry rivalries. In the toffee industry and the energy boost products industry competitors commonly practice above mentioned rivalries. Redbull and Wild Elephant are competitively advertising their products and talks about the quality of their products in the promotional campaigns. Uswatte and Happy Dent toffee manufacturers are introducing new toffees with different flavors and shapes to compete with each other. And we can commonly see the competitive display and shelf space capturing methods in both these industries.

We will be able to give a good competition to both these industries. Because our product prices are much lower than the other energy boost products and ‘Energize’ has a unique sugar free feature comparing with other toffees. So we believe that we will be able to give a good competition and minimize the industry rivalry to gain advantages.

6.5 Financial analysis

6.5.1 Breakeven analysis

The break Even analysis is a very important for any newly formed business or product because this analysis helps the business to correctly identify the point of time where it can actually start earning profit covering all the Initial cost incurred and it also helps to take vital decisions in terms of pricing, Distribution and many other factors which will immensely help the to successfully establish themselves in the market in the long term.

6.5.2 Sales forecasting

There are plenty of methods to forecast the sale for a new product. To forecasting purposing the company will need the help of its Sales Force, and some part of target market opinion. And conducting a market will immensely help to figure out forecast for sales.

In terms of our product which is an Energy toffee which gives instant energy there is no seasonal sales where we can expect more sales for a specified time period within a calendar year. Hence we believe the expected sale will significantly change every month. The expected sales for the beginning part of the introductory stage will be low because the customer awareness will be relatively less. We expect the sales will gradually increase by customer awareness. We approximately expect that the number of units sold during the 3 quarters in the first year will increase by 2500 units a quarter and 5000 units a quarter for the remaining 2 years.

As you can see the budgeted net profit of year 2013 will be Rs. 177,000. It is a huge achievement because usually businesses incur losses in their very first year of performance. We believe that this is due to the strong brand name Daintee, and the strong IMC campaign we have planned to conduct. The next two years are also showing positive and increasing budgeted net profits. This is a very good condition and it expresses the effectiveness the toffee can gain to the Daintee Company. The graph shown in the appendix 4 will further explain the behavior of the profit over these three years. (Refer appendix 4)

Budgeted cash flow shows positive and increasing figures at the end of each year. This is also a very effective situation. Cash in hand is very important to complete the tasks of the day to day business activities. These figures will make the company run this new product very successfully. The graph shown in the appendix 4 will further explain the increasing amounts of the budgeted cash flow. (Refer appendix 4)

6.7.1 Net present value (NPV)

Net present value is one of the most reliable measure used in capital budgeting. It is the present value of net cash inflows generated by a project less the initial investment on the project.

Following we have calculated the Net present value for the Initial Investment we have made by taking the discount factor as 12%.

NPV is important to reflect because it considers about the cash flows, time value of money and future cash flow risks. Net present value for the project energize is positive and increasing. This indicates that the project will increase the firm’s value in the future.

6.7.2 Payback period

Payback period is used to determine the time length taken to cover up the initial investment for a new project.

The time frame in which we would recover the original investment is 1 year and 7 months. This provides an indication of how certain the project cash inflows are. Since pay back period is a very decent figure company will be able to gain the incurred costs quickly.

6.7.3 Return on Investment (ROI)

The purpose of the "return on investment" metric is to measure, per period, rates of return on money invested in an economic entity in order to decide whether or not to undertake an investment. The Return on investment is calculated using the following formula.

The ROI of the ‘Energize’ is around 3%. And it shows a snapshot of the profitability of the project.

6.8 Expected benefits

Through the Market research we have done identified the potential target market and size of the market. This gives us a clear idea to project or estimate the expected sales.

Moving on with the estimation in the initial stages of we estimate to produce around 20,000 units per quarter and if the initial manufacturing target meets its projected level, during the first three months according to our plans we hope to distribute 50,000 units that is 75% of the initial production to distribute among recognized pharmacy chains and mini super markets and retail outlets.

Since the first quarter of first year of operation the level of production will be kept at a very low level that will be around 60% of our maximum production capacity. However if we are able to sell and redistribute at least 90% of our initial output of our production then it will definitely create a positive impact on the consumers mind which will immensely help us to produce more and increase the sale in the remaining quarter of the year.

7.0 Product development

Product development can be identified as one of the most vital stages for a company for the reason that, the measures that are taken in this stage will decide the company’s success or the failure. Hence it’s important to be unique and innovative in order to survive in the business world and gain profits.

Therefore we have come up with a new rage of energy boost toffees on behalf of the Daintee limited with the intention of expanding the business and to gain competitive advantage in the market. The energy boost toffees will be manufactured in Daintee limited factories.

The energy boost toffee will be introduces in three different flavours as, strawberry, black current and mint. Moreover the toffees will be introduced in three types of packaging’s, as a single toffee in a packet, a pack of 6 toffees and a tin containing 20 toffees. And the colour of the packaging will be varied according to the flavour. As pink for strawberry flavour, green for mint flavoured toffee and purple for blackcurrant flavour. (Refer appendix 5)

8.0 Product testing

Product testing is where the effectiveness of the product is measured. From this the manufacture will be able to get an understanding about the products performance as well as the customer expectations towards the product. Hence to overcome weaknesses and flaws of the product we will be collecting data through product testing and will be analysing the collected information in order to offer a healthier product to the customers.

For the purpose of product testing we have conducted a survey on the new product. After studying and analysing the results of the survey we came to know that there is a considerable demand for the energy boost toffee among the people. The main reason for the high demand can be mentioned as the distinctiveness of the product concept and the affordability of the product. Since the price of the energy toffee is low compared to other energy boost products in the market more people will be able to afford it. Nevertheless after launching the "Energize" energy boost toffee we will be conducting another survey in order to acknowledge the perception of consumers about the new product and concede there suggestions as well in terms of new flavours that they prefer etc.

9.0 Commercialization

Commercialisation can be identified as the final stage of NPD. Through this stage, the product will be made accessible to the intended target market.one of the critical phase in new product development process is marketing the new product focussed on the product positioning. Hence to guarantee a suave flow of "Energize" into the projected market, the commercialisation stages have been formed as follow;

9.1 Purpose of the campaign

The major intention of this campaign is to introduce and market the product ‘Energize’ energy boost toffee in to the Sri Lankan food and beverage market as the first ever energy boost toffee. This is done by conducting effective promotional campaigns along with creating awareness among the people about the new product and also to attract new customers.

9.2 Profile of campaign audience

The profile of the campaign audience would be people of every income level especially from the age 16 and above. Apart from that we will be addressing customers who are conscious about sugar and calorie intake and offer them sugar free product.

9.3 Segmentation

When segmenting the market as geographically our target market would be the whole population in the country hence the campaign will be island wide.

When demographically segmented, our product is mainly appealed by males, yet we are also targeting both genders that are in the age of 16 and above.

When the target market is socioeconomically segmented, our product can be categorized as a FMCG and we are pursuing customers of all income levels.

Once closely observing and analyzing the segmentation for the new product we have come up with an apt promotional campaign which will aid us in increasing the awareness of the product among the people.

9.4 IMC for toffee

With the intention of achieving integrated marketing communication objective we have come up with an apt combination of tools to inform and persuade the target market of our product, ensuring improved brand awareness and increase purchase.

9.4.1 Primary tools

Advertising

Television - The TV advertisements about the ‘Energize’ energy boost toffee will be telecast in all three main languages Sinhalese, English and Tamil. Advertising will be commenced 15 days prior to the product launch and will be continued for 4 months period of time. The main intention of advertising is to increase the awareness of the product among the people and to familiarize the name ‘Energize’ in the target market. We will also use easy TV advertisements in Swarnawahini and Peo TV to build awareness of ‘Energize’.

Radio – Same as TV advertisements, Radio ads will be broadcasted 15 days prior to the launch and will be continued foe 4 months in all three languages during prime time. Here also we believe to give a safety assurance message and will persuade people to buy the product by talking about the benefits of the toffee creatively in the radio advertisements.

Newspapers and magazines – Press adverts also will be commenced 15 days prior to the launch in in weekly and week end newspapers in English, Sinhalese and Tamil languages. Further adverts will be featured in magazines namely HI, GO, and Chocolate, which are the most popular magazines among youngsters in Sri Lanka.

Press releases and conferences – Press releases and conferences play a major role in marketing communication and can make a vast impact on the potential customers and it also uncontrollable. Since we are the first to introduce energy boost toffee we hope that we will be able to attract just about every media in the country because it’s a new concept to the market. Hence the management will be open for discussions with newspapers, magazines and other media and provide them with a constructive viewpoint.

Sales promotions

Gifts with purchase - In the first 02 weeks, we will give away souvenirs that are printed t-shirts and caps for the first 100 of customers who purchase the products. These gifts will be printed attractively with ‘Energize’ name logo and the slogan "Unleash the strength within". (Refer appendix 6)

Public relations

Special events sponsorship – we are planning to sponsor special events manly school and other sports events namely Sports tournaments such as cricket matches, rugby matches, and other sports get-togethers will be sponsored by ‘Energize’ with the intention of further increasing the awareness. People can contact us for their sponsorship requirements through fixing a meeting, facebook fan page, call, fax, e-mail or through postal mail.

9.4.2 Secondary tools

Internet marketing

Internet marketing can be identified as a very much effective method of marketing considering lesser cost and the increased usage of internet among the community. The survey information indicated that most of the people prefer online advertisements and promotions. So this will be a very productive medium of advertising for ‘Energize’. One more fact is that quick feedback from the consumers.

Creating a website – Although Daintee already has a website; a new website will be created for ‘Energize’ with the intention of increasing the awareness of people about the product as well as its nutrient facts, flavours and prices and more. The link of the new ‘Energize’ website will be added to the Daintee Limited’s main website.

Facebook/twitter fan page – The Social networking sites Facebook and twitter will also be used to promote the new products. Since these two sites a highly popular among teenagers and young adults. Hence fan pages will be created with the latest updated of the product. All the advertisements, promotional campaigns, photos of the recent activities will be uploaded to these accounts. (Refer appendix 6)

Support media

Posters – prior the launch there will be teaser Posters Island wide in order to grab the attention of the target markets. The posters will be only feature the name ‘Energize’ and will be placed in areas with high volumes of traffic that are frequently visited by the target audience. (Refer appendix 6)

After the launch we will put up creatively designed posters all around in Sri Lanka with the name ‘Energize’, its flavours, prices…etc... (Refer appendix 6)

Bill boards – we will be also promoting ‘Energize’ via bill boards especially by outdoor bill boards where we can reach our target market with a clear, short and a precise message and can adjust the message according to the audience as well. The main advantage of using this method is we will be able to convey the concept of the new product to hundreds of people at the same time at no extra cost. Hence, we are going to place the billboards in areas around Colombo, Kandy, Kurunagala, Gampaha, Nuwaraeliya, Anuradhapura and Jaffna as the first step. (Refer appendix 6)

Street promotions- "Energize" is hoping to travel in the main cities in the country along with a vehicle parade and gain attention of the customers towards the new product. Moreover we will be distributing flyers including information of the product such as, nutrient facts, benefits etc. (Refer appendix 6)

9.5 Campaign measurement

In order to measure the success of the campaign we would be using three methods. First method would be via internet. Since we are creating a Facebook fan page and a twitter account we are able to measure the success of the campaign by analysing the number of likes for the Facebook page as well as the comments that have been posted on the wall. Not only that we also consider the number of followers of the twitter account and the tweets that are made by the followers of the new product.

The second method is by preparing a set of questionnaires. The questionnaire will be mainly addressing the attractiveness, quality, descriptiveness and generation of interest for the newspaper advertisements. This will be done by distributing 100 questionnaires among people and by analysing the responses given by them that will benefit us in understanding the effectiveness of the newspaper advertisements and the magazines and newspapers that they were published.

One more measurement technique that has been used formerly is dummy magazines. A dummy magazine is designed by a certain organization, and an advertisement that has been designed for the ‘Energize’ will be displayed in it. Then this magazine will be distributed amongst a random number of people, and they will be questioned as to what advertisement most attracted them.

9.6 Target market

The target market for "Energize" is teenagers and young adults. when further explaining sportspersons specially who are extreme sports enthusiast, busy workers, working moms who need an energy supplement, dieting people to maintain their energy levels, people who are engaged in weight training, people who work late nights, school and university students, tired workers such as long distance drivers, teenagers and young adults who are most likely to consider the veracity of energy booster products. In addition this product also aims at diabetic patients since its sugar free they too can consume the product without any hesitation.

9.7 Strategies

Since Daintee is a well-established confectionery manufacturing company in Sri Lanka it will be easy for us to enter in to the beverage market as the Daintee is a well-known brand in the country. Primarily we are planning to launch "Energize" in Colombo, Kandy, Gampaha, Anuradhapura, Kurunegala and Jaffna.

9.8 Positioning of the product

The introducing toffee, Energize will give you a quick boost of energy. So we are positioning it as ‘Unleash the strength within’. Which will, communicate the idea of the effectiveness of the product. The main reason we have selected this positioning slogan is because we believe it appeals more to our main target audience, the youngsters.

9.9 Marketing mix (4 P’s)

Product

As discussed above the product we are going to introduce is named as ‘Energize’ as a new product of Daintee. It is an energy boost toffee which has sugar free attribute. And according to the potential customer preference, we have decided to manufacture mint, strawberry and blackcurrant flavors of this product. ‘Energize’ will be a great alternative to other candies in the market because of the sugar free feature and its flavors. Energy boost product consumers can switch to ‘Energize’ to gain healthier outcome for a lower price. ‘Energize’ will be a total new experience to the customers.

Price

‘Energize’ toffee will be priced as Rs. 25.00, tablet card will be Rs. 150.00 and toffee tin will be Rs. 460.00. ‘Energize’ will be priced higher than the available toffees in the market because the sugar free ingredients and energy boosting ingredients will cost more. But it will be a lot lower than the energy boost drinks in the Sri Lankan market. Daintee is currently has an in house production of ‘Xylitol’. It is a main ingredient ‘Energize’ will use as a sugar free ingredient. So we have access to this ingredient for a lower price. ‘Energize’ will give quick and guaranteed results for a lower price.

Place

We are expecting to make ‘Energize’ available all around in Sri Lanka. Since Daintee distributes its products all over in Sri Lanka, we will have an added advantage when it comes to distribution. According to the information gathered from the questionnaire people mostly buy energy boost products from super markets. A considerable percentage of people buy from convenience stores and pharmacies. So we decided to make available ‘Energize’ in super markets, convenience stores and pharmacies all around in Sri Lanka.

Promotions

Promotional campaigns are the main technique we are going to use to build product awareness. Above we have stated a complete IMC campaign to promote ‘Energize’ in the Sri Lankan market. As primary tools we are expecting to use TV, radio, newspaper and magazine advertisements, press conferences, sales promotions and public relations and as secondary tools we will use internet marketing and support media. We are planning to start our promotional campaign two weeks prior to the launch. Promotions during the TV programs that Daintee sponsors will be the best opportunity to complete this task.

9.10 Marketing strategies

As we mentioned above we will get the patent license for ‘Energize’ so that no one will be able to imitate the product. This will minimize the direct competitors for few years. By stating "First to introduce energy boost sugar free flavored toffee to the Sri Lankan market" in the packaging and promotional campaigns, customers will be able to recognize as the market leaders. So we will use Market leadership as a marketing strategy.

9.11 Competitive strategies

The unit price of ‘Energize’ toffee will be Rs. 25.00. Indirect competitors such as Redbull and Wild elephant will cost around Rs. 300.00 in Sri Lanka. ‘Energize’ will create a lower cost and the selling price will also be very lower than the competitive products. This will be an advantage for us and we are hoping to highlight this advantage in our promotions. As we mentioned above some important ingredients are currently produced by Daintee. This will help to minimize the unit cost of ‘Energize’ than others in the future.

9.12 Distribution strategies

Energize will be sold through distributors and retailers. Pull strategy and the push strategy will be very important for us and we are planning to implement some of the ‘Daintee’ strategies as well. As pull strategies we are hoping to use advertising and mass media promotions, sales promotions and PR activities.

10.0 Launch

The launching program is concerned on giving a consistent awareness to the target audience and to bring attention to the factors of ‘Energizer toffee’. This process will focus on all the necessary actions for an effective product positioning, planning and implementing promotional activities. (Riley, 2012)

The main goals of the product launch can be recognized as to gain publicity and media coverage, positioning the product to the target group that they would not hesitate to try out the new product and importantly to promote the precise concept of the product. The agenda of the ceremony is attached under appendix of this report. (Refer appendix 8)

10. 1 Launch plan

Who

Board of directors of Daintee, Investors, famed Sportspersons, celebrities, few special guests, journalists and reporters are invited to the ‘Daintee Energizer Launch’. In order to create a positive awareness about the product and its ingredients few guest physicians have been invited. The total guests would be around 60 persons.

What

During the launch project managers will provide a clear and precise understanding of the new product to the guests, including product details, benefits and its importance. Meanwhile the guests will be offered with a snack and Energize toffees giving them an opportunity to experience the new product firsthand and to make a decision to themselves the significance and desirability of the new product. From this we will be able to observe the guests and comprehend their opinion. In the end of the launch all the guests will be offered with gift packs of Energize toffees of all three flavors and souvenirs; a pen and a pocket calendar with the name of ‘Energize’. (Refer appendix 7)

Where

The launch of the product will take place at the hotel Hilton Colombo the main reasons for choosing this location are, this location is known for its grandness and flamboyant ambiance hence launching the product in this hotel will affect the brand and the new product in a dignified manner. Not only that the location is very much convenient to reach and can accommodate 60 people. The location creates the perfect atmosphere to bring out the overall experience that needed to be presented via the event. Furthermore the publicity generated by the occasion will aid in gaining awareness in the midst of the public.

When

To ensure the maximum participation this event will be held on a Saturday evening at 5.00 pm on the 2nd of February 2013.

Why

The board of directors will be the main target participants for this event. Celebrities, physicians and famed sportspersons will ensure the positive public relations, word of mouth and customer awareness. The journalists and reporters are invited in order to provide publicity and awareness.

Through this section we would predict, "Why those invited will attend the particular event?" Considering those invited board of directors and the celebrities will attend as they thrive to be in the centre of events and especially unique events. The board of directors is the main target audience at the launch; this is because the ‘Energize’ is their concern.

The reason for calling celebrities is to ensure public relations is gained through this, and furthermore in order to ensure positive word of mouth and customer awareness too. The press will be invited for the purpose of providing publicity.

12.0 Conclusion

The main purpose of this report is to provide a brief understanding about the new product concept that is introduced by the team of ‘Energize’ energy boost toffee. This product is developed by coming together with Daintee limited, which is identified as one of the leading confectionery manufacturing companies in Sri Lanka. Launching of this new product into the Sri Lankan market will benefit Daintee limited with increased recognition of the company and brand as well as gained competitive advantage among competitors. The ‘Energize’ energy boost toffee is introduced for the first time in Sri Lanaka, giving Sri Lankans an all new experience. We are mainly targeting teenagers and young adults who are in to sports and busy working schedules who need an instant energy in their busy life styles. In the initial stage we carried out a research to find out the response of the target audience and the concept was developed further. The concept of energy boost toffee came to life by developing the recipes, testing and designs for packaging. Then the finished product was tested with the target market to make sure the acceptances of the product. All the way through this report we have made clear of the process of development of the new product as well as the different methods that are gonging to be implemented launch the product successfully into the market. Hence we believe the product ‘Energize’ ‘Unleash the strength within’ will be able to make a difference in the Sri Lankan market.