Almarai Company Case Study Analysis
Marketing Mix Strategies
Almarai had a world class dairy operation with a diversified product base, which was named as the most innovative company because of its proactive approach, in 2017. To manage its diversified product portfolio, Almarai had adopted the following marketing Mix strategies to establish its strong brand name.The marketing mix is consisting upon four P’s: place, product, price and promotion.
- Product:Almarai delivers high quality product with its established brand name. it has diversified product portfolio, which includes dairy, juice, yogurts, poultry, infant nutrition, fresh milk, bakery products and other perishable products. It had delivered fresh poultry products, whereas the market delivered frozen poultry products. Its branded products includeAlyoum and Nuralac (Infant’s milk formula). Nuralac did not yield the expected returns as, according to the Almarai executive, Infants’ formula market was already crowded with many competitors and the product were mainly sold at pharmacies only.
- Price:The pricing strategy of Almarai was fully depended on the subsidies provided by the government. People became conscious about the price charged and asked frequently for the discounted prices and coupon rates because of tightening household budget.
- Place: Bakalas were its main sales channel and they were equipped with advance refrigerators for keeping the Almarai products fresh for a longer period of time. The products were mainly showcased at the Bakalas’ shelfs and refrigerators.
- Promotion:For product’s promotion and marketing, Almarai used the advanced packaging strategy by using neat and clean plastic for covering the tray, to transform its customers’ experience.
Alternative solutions
After evaluating all the situation with the help of number of situational analysis tools, following alternatives has been proposed for the organization to cope up with this intense challengingsituation due to current changing economic context. (See appendix 3)
Solution #1- Expend Customer Base
Almarai could expend its customer base to cope with this economical changing condition. They could manufacture low cost products and should target low income groups also along with upper class customers. Bakalas were its main sales channel and they were equipped with advance refrigerators for keeping the Almarai products fresh for a longer period of time. They could capture this market with the help of this channel.
Pros
- Low cost product
- Increased customers
- Low investment
- Already established brand could capture target market easily
Cons
- Brand equity will hit
- High risk factor
- Unaware of market trend
- Quality compromise
Solution #2- Large Scale Dairy Farms
Almarai should approach large scale diary farms development. It could capture neighboring counties such as Pakistan. Malaysia, Indonesia, turkey, Iraq and Sri Lanka. Reaches had proved that these countries consume more fresh milk as compared to other countries and the per capita consumption of fresh milk would be increased with highest rates. It could attract new customer by providing them with convenience and friendly structure along with providing them clean packaging.
Pros
- Number of customers will increase
- Soft entering policies
- Expected per capita increased consumption
- Approach new markets
- Already established brand could capture target market easily
- Sales will increase- long term benefits
Cons
- High investment
- High risk factor
- Unaware of market trend
- Quality compromise
Solution #3- Expand ProductBase
Almarai should consider another option of entering into new product segments which could be fish market. Fish market is another potential emerging market for Almarai. High and attractive packaging could attract more consumers, but it should be noted down that fish market has limited consumers. It could enter into more product segments such as ice cream, soymilk or vegi6atable production.
Pros
- Number of customers will increase
- Approach new markets
- Potential emerging market
- Already established brand could capture target market easily
Cons
- High investment
- Unexperienced staff
- Limited customers- fish consumption
- Unrelated diversification
- High risk factor
Recommendations
After evaluating all the available options with respect to itsassociated pros and cons, it is recommended to Almarai that it should approach large scale dairy farms development. It could capture neighboring counties such as Pakistan. Malaysia, Indonesia, turkey, Iraq and Sri Lanka. Reaches had proved that these countries consume more fresh milk as compared to other countries and the per capita consumption of fresh milk would be increased with highest rates. It could attract new customer by providing them with convenience and friendly structure along with providing them clean packaging. In addition to this, it would be an easy approach to target more customers for the organization because of already established brand.
Conclusion
It is concluded that Georges Schorderet, the CEO of Almarai Company, was going to announce its retirement soon. He was worried because of the changing demographic and environmental conditions in the Saudi Arabia. It had acquired 33% market share of Saudi Arabia’s dairy industry. Its competitors include Nadec which acquired 6% market share, Al Safi Danone acquired 8% market share and Sadafco acquired 7% of dairy market share. it is recommended to Almarai that it should approach large scale dairy farms development. It could capture neighboring counties such as Pakistan. Malaysia, Indonesia, turkey, Iraq and Sri Lanka. It could attract new customer by providing them with convenience and friendly structure along with providing them clean packaging.........................
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