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Identify five microenvironmental factors that affect the development and introduction of Vitango. Explain the role each of these factors played in Coca-Cola’s strategy. Divide your answer into five sections, one for each factor.
Factor #1 – The Company Research and Development works with Top Management, Operations, Accounting, Purchasing and Finance in the case of Vitango these areas need to be looked at simultaneously. Coke-Cola marketing managers need focus on providing a product that will be attainable for the target market; very poor school aged children that suffer from malnutrition.
Marketing manager’s strategies will need to focus on three areas. The first is the research and Development of the product. The current form of powder will need to be redeveloped in to ready to drink version as the possibility of clean water to mix with could be a challenge for the target market. The second area of affordability will also be looked at. The price of the product can not be too high as the target market will not able to afford it. The third area of education is also another important factor which must be reach target market. Without the education to combine Vitango with a balance diet, the target market may still derive malnutrition problems by missing others nutritional needs. Vitango is a supplement not a replacement for regular diet.
Factor #2 – Marketing Intermediaries With Vitango, there are two basic Marketing Intermediaries of Local Government and the Global Alliance for Improved Nutrition (Gain). Both of the Marketing Intermediaries participate in promoting, educating, and as financial intermediaries. Although some local governments may not have many funds for this type of support, they will play a heavy in Promoting and Educating in their countries. Gain on the other hand will provide financial support with funds made available to the Local Governments to increase demands for fortified foods. For Gain, they also lobby for favourable Tariffs and Tax rates for Coke-Cola. Coke-Cola is looking to partner effectively with Marketing Intermediaries to allow for a seamless optimizes Performance of the entire system.
Factor #3 – Customers Vitango customers are the children that suffer from malnutrition in poor countries. This is the Consumer Markets defined by individuals and households that buy goods and services for personal consumption. The customers here are also further defined as Children attending school that have trouble to sustain attention in class. Coke-Cola is developing a supplement to deliver fortified foods improve the nutritional issue faced by these children. The end result is that these children will be able to receive education with the proper focus and vigour to make learn easy and fun.
Factor #4 – Competitors P&G is competitor is this market. P&G is also looking to develop fortified foods for the same target market of Children that suffer malnutrition that have problems with staying attentive in school. Here Coke-Cola will watch and collect information on P&G progress. Looking at how P&G gets the product out there. An interesting use of McDonalds proved success for 50% of Happy Meals include there product as the drink of choice. Price points and the ability for families to afford the product choices is another area to watch as Coke-Cola develops their marketing plan.
Factor #5 – Publics With the various publics at work with Vitango, you need to be aware of several. They included Financial Publics, Media Publics, Government Publics, Citizen-action Publics, Local Publics, General Publics and Internal Publics. For Coke-Cola the interest of all the publics due plays important part in the marketing process. For instance, Government Publics is one that needs to support the Fortified food for their countries. Without the support, efforts will be lost in the red tape. Another is Local Public where it is important to promote and educate how to use the fortified foods which is in this case is Vitango drink mix. General publics can also extent multiple countries with define interest of how well it is received and the positive effects the product has. All the publics have potential impact or interest in the end objective to improve the malnutrition of school child in poor countries,
Question 2 (20 marks)
Identify four criticisms of marketing’s impact on individual consumers. Describe how GAIN and the Vitango case might or might not be subject to these criticisms. Support your answers with examples from the Vitango case.
Divide your answer into four sections, one for each criticism.
Section #1 – High Prices As seen in the case, the price has been placed higher than other none fortified drinks. Although the high cost of development and lead times do play a big determinate of price, the Gain and Local Government should assist where possible to price the drink mix a price level the target market can afford and choose for the right reasons. Gain should be enlisted to provide funds that allow the drink mix deliver to the very poor that would not be able to make the choice to buy Vitango. This may include providing the drinks free through school and other nutritional programs the Local Government may have. This market is a market that does not have many funds available to purchase the necessities of life, therefore since this a necessity the price should be set with that in mind.
Section #2 – Deceptive Practices Deceptive Practices are seen here because Coke-Cola is a for profit company. Even the pricing model has been placed at a higher cost than other mix with water drinks. This is why it is important for Coke-Cola to use organization like Gain to be trusted by the publics of the market they are working. Although, the mission of the Vitango product to provide a fortified supplement to the diet of malnutrition school children, Coke-Cola will still be seen to be looking for profit in some from.
Section #3 – High-Pressure Selling Vitango fortified supplement as a high pressure selling practice, I don’t really see. The High Pressure Selling aspect will be how to educate the families on the benefits of the product. One way this can occur is to use Marketing Partner like P&G did to match their product up with an option for the Happy Meal at McDonalds. High Pressure Selling would have benefits of getting the product to the target market to over come some of the educating needs for the consumers.
Section #4 – Shoddy or Unsafe Products Vitango product development so far has had a long lead time. Studies on how the product has improved the attentiveness of the children have been done in a control environment. Other issues have also been consider such as the availability for clean fresh water. This has also caused another delay to getting the product to market. A need now to develop the Vitango fortified beverage in liquid form must now occur to meet the objective to provide a safe and consistence product. With the time that Coke-Cola has invested, this company is not going to turn out a product that does not meet the standards.
Question 3 (15 marks)
Identify three criticisms of marketing’s impact on society. Describe how GAIN and the Vitango case might be subject to these criticisms. Support your answers with examples from the Vitango case. Divide your answer into three sections, one for each criticism.
Section #1 – Consumerism Gain mandate to assist companies in lobbying for favourable tariffs and tax rate and along with speedier regulatory reviews of new products in targeted countries. They also give money to Local Governments to increase the demand for fortified foods. This includes large scale Public relation campaigns or a Government “Seal of Approval”. In Vitango case, Gain is there to assist with $70 million over a 5 year period starting in 2002. Consumerism here is driven by Gain and how it assists companies like Coke-Cola develop and deliver to market in developing countries fortified foods to the target markets. Here Gain will also help deliver the Vitango Product to the children that most need it. This will be done through programs like available in schools for free and other nutritional programs. Gain will also encourage the basic pricing to be more competitive with what the consumer can afford. Consumerism is how Gain will make a difference in this Marketing Project.
Section #2 – Environmentalisms Environmentalisms is not quite evident is this case. Coke-Cola would need to package the Vitango product some how. There would be a need to look at how the packaging would effect the environment as poor countries may not have a good recycling program. Here Gain could support by providing money to develop the packaging to be environmentally friendly whether recyclable or bio degradable. Another aspect is the fact that a balance diet is still required in conjunction to Vitango product. Vitango fortified beverage does not contain any juice and is intended as a supplement.
Section #3 – Public Actions to Regulate Marketing Gain, Coke-Cola and others deal with public actions to regulated marketing. In the case with Vitango product, Critics has said the selling or giving out fortified foods will not solve the malnutrition problem of poverty stricken families. This also does not teach them to choose a balance diet. Another criticism is that product like Vitango will contain large amounts of fat, sugar and salt which could lead to obesity. Again others claim that teaching them to grow the fruits and vegetables would be better than provide fortified foods. At any rate a combination of these criticisms need to be considered and use the marketing plans. One instance is the education to go with the product that encourages a well balanced diet from the fruits and vegetables the critics pointed out. Public actions to Regulate Marketing in an area are what Gain and Coke-Cola need to pay attention to.
Question 4 (25 marks)
Consider the five principles of enlightened marketing. Could the Vitango case be considered enlightened marketing?
Divide your answer into five sections, one for each principle. Section #1 – Consumer-Oriented Marketing Vitango fortified beverage product is definitely is Consumer-Oriented Marketing. The market that was defined for the product is one that the Coke-Cola company organized it efforts around the consumer. In this case malnutrition school children are the target market. The Consumer-Oriented Marketing is used here because the end consumer, the children, have a define market niche focus on the consumer. The sensing, serving and satisfying the needs is relevant here as the target market does not know they need this product and the benefits it provides.
Section #2 – Innovative Marketing Vitango has not gone main stream yet. This is in part due to the competition venture into similar markets. Also the competition has partnered with MacDonald’s has highlighted some marketing needs for the customer. This includes that the target market may not be able to afford the product as Vitango is target at the poor. Another Innovative Marketing area is the need to have the product as a ready to drink as appose to powder that is mixed with water. This is due to the available of raw materials, in this case clean fresh water. The marketing needs to be innovative realities for the target consumer.
Section #3 – Customer-Value Marketing Coke-Cola is showing Customer-Value Marketing buy continue to review pricing and market conditions. This includes the partnering with Gain help provide money to deliver the Vitango product to the target market. Again Coke-Cola is redeveloping the Vitango Fortified beverage into a ready to drink form to become more safe and consistent for the customer. Coke-Cola is working on many different Customer-Value Marketing aspects.
Section #4 – Sense-of-Mission Marketing Coke-Cola has put forth a Mission to provide the fortified product of Vitango beverage mix for School children suffering from malnutrition in poor countries. To assist with this mission Coke-Cola has partnered with Gain, an organization set up by Bill and Melinda Gates charitable foundation. Together they will work towards improving the nutrition for children in poor countries. Sense-of-mission Marketing also allows Coke-Cola to give back to the communities through the employees feeling good about there work.
Section #5 – Societal Marketing Coke-Cola is looking at the interest and wants of the consumer. Although not easy to see the want as it relates to the customer well being then the actual product. The child wants to do well in school. Coke Cola is also looking the interest of the customers as well. Even if the Want is not truly defined by the customer, the interest for the customer is looked at as well. In the best interest, the customer would benefit from the Vitango Fortified beverage supplement. Societal Marketing is also looking in the long term. Also in this case, it is suspected Coke-Cola is also looking ahead for other profitable results from this in years to come.
Question 5 (15 marks)
Does the fact that fortified foods are common in North America guarantee the success of Vitango in developing countries such as Botswana and Peru? Explain your answer using the concepts of need, want, and demand.
Divide your answer into three sections, one for each of the three concepts. Section #1 – Need The need here is defined as children attend school suffering from malnutrition, therefore are not getting the most out of the education due to unable to concentrate. The need is to have a product that delivers the Vitamins and Minerals lack in the children diet. Vitango Fortified Beverage mix is a product that fits the needs of the customer.
Section #2 – Want The Want for Vitango differs for the reason of how poor the customer is. The poor families that are targeted will not be able to afford the product easily. I most case something else will have to be not purchased for the Vitango fortified beverage mix to be purchased. The ability for Coke-Cola to provide the product is not a problem; it is the Customer ability to obtain the product will be the problem.
Section #3 – Demand Demand for Vitango will be dictated by how well the target Market perceives the effectiveness for the children. If the children show a marked improvement, then the demand will be greater. The money that is used to buy the product will be made available from the small budgets that the customer has available. The demand could also increase from the Local Government programs that may be in the schools or other Nutritional programs. Children may attend school more regularly than before to receive the Vitango beverage free, there by encouraging education and balance diets. Demand here may not be the same as in North America.