(MKT744) Marketing assignment on global marketing and sales management of Heinz in India and the UK

Question

Task: Select a company for your marketing assignment. Write about the Company’s International outlook image and profile and the product/category selection. Provide a brief overview on marketing environment of two selected countries. Write about the market entry strategy, segmentation and marketing mix decisions for both countries.

Answer

Introduction
The marketing assignmentprovides an overview about Heinz that is an established ketchup company based in the US. The essay reflects on global marketing by taking into account two major countries such as India and the UK. The marketing assignmentstarts with the international outlook about Heinz that provides a summary about the major products the company manufactures as well as the competitive strategy used by it. It has been followed by a brief overview on the major global competitors of Heinz. The second part of the marketing assignmentwill be a brief overview about both macro as well as micro environmental analysis of India and the UK. The third part will be the market entry strategy that will analyse Heinz practice of how it penetrated in both India as well as the UK. The fourth part will be an overview on Segmentation, targeting and positioning that will show how STP for India and the UK was incorporated by Heinz. This part of the marketing assignmentwill be followed by marketing mix decisions for both the major countries. This part will analyse product, price, place and promotion for both India and the UK by keeping Heinz in mind.

Marketing and Sales Management of Heinz discussed in the marketing assignment
International Outlook Image
Heinz is a food processing company that is based in the US and headquartered at One PPG Place in Pittsburgh. In the year 1869 the company was established by Henry J. Heinz. The company is known to produce several food products that are marketed to over 200 countries as well as territories globally. It is found from the marketing assignmentthat in the US market for ketchup, Heinz has been placed the first spot with a market share of over 50 percent. In the year 2015, Kraft Foods got merged with Heinz’s holding company to form Kraft Heinz (Heinz, 2022). The number of major products that is being traded by the company includes ketchup, meals, baby foods, sauces as well as snacks. The major services include serving different customers including food retail stores, the army as well as the foodservice sector.

The competitive strategy that is followed by the company includes cost leadership strategy as Heinz provides products as well as services with adaptable quality at a reasonable price and tries to adjust to economic circumstances. As a result, Heinz has been continuing to perform in a better way with raised market shared in present times. As per the marketing assignmentdata, the fiscal year 2021 reflected that Heinz has operated in almost 79 manufacturing as well as processing facilities. Heinz has international presence in several countries that includes the United States, Indonesia, Canada, Australia, China, India, New Zealand, the United Kingdom as well as Netherlands(Heinz, 2022). It is the third-largest beverage as well as food company located in North America as well as fifth largest globally. It is analysed from the marketing assignmentthat the major competitors that provide direct competition to Heinz includes Nestle USA, Kerry Foods, Mondelez International as well as Danone. But the company has been committed towards investing world-class brands as well as long-term creation of value.

Brief Overview on Marketing environment in the marketing assignment

Microenvironment explained in themarketing assignment
Customers: Customers are regarded as an imperative part in any business and as a result, it becomes requisite to differentiate customers based on their types. It is found from marketing assignmentresearch that in India, the first major type of customer includes discount customers. These individuals shops on a frequent basis but they purchase goods primarily on discounts (Chawla and Kumar, 2022). The second major type customer base is wandering customers under which the individuals are not sure regarding what they desire to purchase. The customer type in the UK is mostly loyal customers. These individuals contribute to a minimal amount of customer base but creates a huge portion of sales.

Competitor analysis: The competitor analysis for both countries will be analysed through their strength and weakness. As per the marketing assignmentthe major strength of India is that the country has a reinforced industrial base and is the second largest producer of food in the world that has been advantageous for Heinz. On the other hand, poverty acts as the major weakness. In spite of adequacy in food, the country remains in poverty. The major strength of the UK is its beneficial trading position that has helped the country to hold good relations with both exporters as well as importers. Poor transport is however a major weakness for the UK, that takes place due to several industries situated in the country.

Market Entry Strategy
Heinz is an American company which has entered two foreign markets. Heinz had to understand the market and external business environment of both India and UK in order to expand and enter these nations. As per the marketing assignmentIndia is a part of Asia while UK is a part of Europe. These two nations are very different from each other and also from the US, in terms of their choices, culture, lifestyle, affordability, tastes, etc.

To enter the market of India, Heinz had adopted the joint venture mode of market entry. The company entered the Indian market by partnering with the Japanese company Nissan Foods. Kraft Heinz entered the Indian market with their ketchup product. The company made a deal for distribution with Nissan Foods in India (Kraft Heinz, 2022). This market entry strategy addressed in the marketing assignmentfacilitated the company to enter other markets simultaneously. Heinz got the support of a partner distributor who conducted the transactions with the potential buyers in India. The major benefit of Heinz in partnering with the Japanese company Nissan Foods was that the latter had a ready access to the existing customer base. They had market knowledge as well as insights about demand trends in the Indian market, which they provided Heinz. The only drawback of this mode of entrymentioned in the marketing assignmentwas that Heinz was totally dependent on Nissan Foods for their sales.

In the UK market, Heinz entered in the year 1986. The company had first launched their Heinz Tomato Ketchup in the UK market. The company entered the market with direct sales strategy. Heinz started selling their products directly in the stores of UK. As per the marketing assignmentthe company started selling their tomato ketchup, baked beans, and other products which they had termed as the seven varieties of newest and finest goods, across London. The products of Heinz started being sold at the Fortnum & Mason food stores of UK (Lyon and Kautto, 2021).

Segmentation, Targeting and Positioning
Segmentation, Targeting and Positioning (STP) are crucial for marketing and selling the products. It is found from the marketing assignmentthat Heinz followed the STP for segmenting their audience, targeting the best-fit or potential customer segment/s and positioning their products in the two markets of India and UK. They tried to capture their target customer segment effectively. The market segmentation can be demographic, behavioural, geographic and psycho-graphic. As per the marketing assignmentanalysis the core items which are sold by Heinz include sauces, ketchups, snacks, meals and baby foods. Most of these products like ketchups, sauces, snacks and meals appeal to all the segments of the market (Nachay, 2018). The baby foods however have their specific targets. Targeting is a very significant step in STP approach. The best fitting customers for the products are targeted. In case of the products of Heinz in India as well as in UK, the target customers include a huge audience. As per the marketing assignmentthis is because ketchup or sauces are products which are not reserved for any specific age group or socio-economic status or gender. Everyone uses sauces and ketchups with food. Thus, Heinz does not have to focus much on targeting as it is a brand for all (Nguyen et al, 2020).

Positioning of the brand is however very crucial. Heinz ensured that they have a strong brand positioning. As per the marketing assignmentthis included a holistic view of how their brand, and how the company wants their brand name or image to be perceived by the customers. Thus, positioning of Heinz involved the when, who, how and why of the brand’s identity in the two markets. The tone, voice, visuals, impression, etc. of the brand differentiates it from its competitors in the market (Budovich, 2019). For these reasons, the customers prefer Heinz over other competitors’ products. Though Heinz has been successful in UK, in Indian market the brand could not strengthen its footing.

Marketing Mix Decisions
The marketing mix traditionally consisted of the 4P’s, which included the product, the price of the product, its place of sale and the promotion of the product. The marketing mix as opined by Thabit and Raewf(2018), is the base model for any business. As per the marketing assignmentfindings, this is nothing but a collection of marketing tools which the organisation utilises for pursuing the marketing objectives in their target markets.

Product: For any business to thrive and prosper, the most significant aspect is its product or service which it is wanting to offer to the customers in the market (Hazimeh, 2020). In this case, the focus should be on the products offered by Heinz to its customers. As per the marketing assignmentthe company, Heinz, has implemented product adaptations in their marketing and sales strategy. The product adaptations as per Samiee and Chirapanda(2019), refer to the differentiation, customisation or localisation of the products, which come in various forms. To adjust and adapt to the markets in India and UK, Heinz being of American origin made various product adaptations. There are various peculiarities or taste requirements of the local markets with which the brand has to adapt and localise. As per the marketing assignmentthe main products sold by Heinz include sauces, ketchups, meals, baby foods, condiments and snacks. These food items are preferred by most of the people in every country. However, the way people eat in India differs from the way people eat in UK or US. In the year 2000, when Heinz launched their ketchup in the Indian market, the product should have been easily saleable. However, the product failed to capture the market in India (Bentley, 2021). India has a huge population where there are grownups as well as children who prefer tomato sauce or ketchup with their foods like aloo tikkis, khichdi, dosas, etc. Heinz could not access this market and customer base in India. To compliment the Indian food, Heinz could not make its product palatable. It is found from the marketing assignmentthat the ketchup needed Indian-ness or product adaptation. To cater to the taste buds of the Indian population, the product of Heinz had to be changed in composition and taste. The company tried to tweak the international concoction for suiting the taste buds of the Indian masses but it was not quite palatable.

In the UK market, however, Heinz managed to set its products. They cracked the market and customer needs well. The baked beans of Heinz sold well in the Fortnum & Mason food stores of UK (Durbach, 2019). As per the marketing assignmentanalysis, the company understood and suited the taste of the people of UK. The ketchup of Heinz had become the topper when tracked by customer watchdog Which!.The product of Heinz turned out to be the highest price gainer in the UK market. Product standardisation is needed. But to suit the criteria for internalisation, product adaptations are very important. This follows the concept of logical incrementalism, which says that continuous and consistent change brings flexibility and allows experimentation. As per the marketing assignmentthe most crucial part of product adaptation and differentiation is management effectiveness. If this fails, a strategic drift is likely to take place. Product adaptation had been a reactive response for Heinz to adjust in the market of India and UK by understanding the environmental changes. Price: Price is a very crucial factor in the marketing mix. The demand is led by the price, so is the supply. The pricing is important for Heinz as it is the only element which generates revenue for the company to sustain in the market (Siddiqui et al, 2022). Product, place and promotion are cost centres as they add to the cost of the company, while price is the revenue centre. As per the marketing assignmentthe prices of the products of Heinz determined their success and future in the markets of India and UK. Heinz has followed the competitive pricing strategy. They tried to keep the target customers and their affordability in mind. The management of Heinz considers their pricing decisions keeping the economic conditions in mind and addressing the consumer habits. The ketchup from Heinz has been performing well in the market of UK and have increased their market shares recently. However, the international market share of the company in terms of snacks has decreased over the past few years. It is found from themarketing assignmentthat currently the company is trying to stabilise its prices. In order to improve their sales and gain a competitive advantage, Heinz produced upside down shaped bottles along while continuing with the promotion of large sized bottles in their core retail outlets. The company continues to face tough competition from Nestle, Kissan, and other companies producing similar products like sauce or ketchups (Gulati, Wardhan and Sharma, 2022). The company decides its pricing based on the moves of its rivals. In UK, Heinz managed to implement its pricing strategy effectively. As per the marketing assignmentthe company had set their prices considering the standard of living and average income of the mass as their products appealed to all socio-economic strata. In India, Heinz failed even in terms of pricing. The problem was that Heinz did not understand the customer preferences and consumer purchase behaviour when it came to ketchups or sauces. It is analysed from the marketing assignmentthat the customers in India were not ready to pay much for complementary food items like ketchups. Thus, Heinz got the pricing strategy completely wrong in the Indian market. The competitors of Heinz like Kissan from Hindustan Lever and Maggi from Nestle captured the market share in India who sold tomato ketchups for much lower prices than Heinz (Singh and Singhal, 2020). The comparatively lower prices of the competitors made Heinz fade away from the Indian market.

Place: Place and distribution strategy plays a crucial role in the marketing mix part. India has always acted as a major market for Kraft Heinz and the company has partnered with Indo-Nissan Foods thus receiving a pan-India distribution network. As per the marketing assignmentthis network has helped the company to distribute its products as well as make them easily available to Indian customers. The pan-India distribution network acted as a core advantage for the brand. Through this broad distribution network, Heinz has not only been able to make their products available in Supermarkets but also in rural regions. Heinz products are also readily in online grocery through this particular distribution strategy. The partnership between Indo-Nissan Foods and Kraft Heinz has also showed a marvellous cultural fit between these two companies thus delivering the best to the Indian customers(Gulati, Wardhan and Sharma, 2022). It is noticed in the marketing assignmentthat India is also a country that provides low-wage labours that benefits Heinz in several ways. The labour market in India is highly unorganised that has made labours readily available in the country. Similarly, in the UK also it has a widespread distribution network that provides effective as well as rapid workings. The distribution channel in the UK includes servicing manufactured plants and trading products from manufacturers to wholesalers followed by retailers. This in turn has made the products of Heinz easily obtainable in local markets as well as Supermarkets located in the UK. The country follows a transferable competitive advantage as a part of standardization. In other words, Heinz provides standard products in the UK that provides several competitive advantages. As per the marketing assignmentthe cost saving provided by economies of scale permits the firm to acquaint with competitive pricing. On the other hand, the UK is known to witness a tight labour market over the years that has been creating labour shortages. Although the UK economy is economically developed, labour shortages has been creating issue among manufacturing units in Heinz.

Promotion: Heinz has been adopting various means for promoting their products in India as well as UK. They have been designing advertisements and campaigns for the purpose of marketing and selling their goods in the respective markets. As per the marketing assignmentthe primary means of Heinz for promotion has been engaging their customers though TV advertisements. However, the company eventually started aggressive promotion through direct marketing techniques. This they used in India as they thought it would facilitate building long term and stronger relations with the customers. In this era of digitalisation, Heinz has resorted to digital marketing or social media promotions for their products. The company is using technological support for targeting the individual customers of India as well as UK. Heinz launched their food advertisement campaign which they titled as ‘Insist on Heinz’. This slogan they tried to use for promoting and taking their brand far and wide. The company significantly invests in the marketing, promotion and advertisement campaigns to gain competitive advantage and sustain in the market. As per the marketing assignmentthere is increased competition from domestic and giant global companies in the industry in UK and India. Thus, promotion is the area where Heinz can create their competitive edge over their competitors. The company formulated the ‘Group 57’ which is a team of experts from the culinary field (Bagheri et al, 2022). This team provides innovative and new ideas for satisfying the customers with the taste and products of Heinz. The company is promoting in India and UK, their tomato ketchup, which promotes the basic health benefits of tomatoes. Heinz advertises the benefit of lycopene for health which is present in tomatoes. The health conscious global population is likely to be moved and attracted by this form of promotion. It is found from the marketing assignmentthat through this nutrition and health education Heinz is promoting their tomato ketchups. The company through its TV, newspaper and hoarding ads and social media promotions is trying to create a better and positive brand image. This they know will get them loyal customers for the long run. Heinz uses various forms of promotion techniques from time to time. The company uses direct selling when it is desperate to get its products sailing and selling in the market. Heinz also uses the sale promotion methods like offering discounts, free items, buy one get one, etc. Through direct marketing they are trying to reach closer to the customers (Hawkins, 2021). As per the marketing assignmentthis includes social media promotions, posts, etc. Heinz to increase its reach and make its brand visible to customers is trying to use public relations methods of promotion which includes sponsoring events, etc. The promotion is such an important part of the marketing mix, that it requires an integrated approach inclusive of direct marketing, direct sales, social media advertisements, TV and printed ads.

Conclusion
It could be concluded from the marketing assignmentthat both the large countries, India and the UK does not create issue for Heinz in terms of political, economical as well as social and legal matters. India involves discounted as well as wandering customer base whereas, the UK has loyal customer base that are not huge in numbers but brings high profit. It could be inferred from themarketing assignmentthat the market entry strategy used by Heinz to enter India has been joint venture mode where the company entered by partnering with the Japanese company Nissan Foods. It has also helped the company to create a pan-India distribution network. The company on the other hand, used direct sales strategy to enter the UK. The target customers have been huge for Heinz both in India as well as the UK. The Heinz ketchup required Indian-ness or product adaptation while using product strategy in India. On the other hand, Heinz turned out to be the highest price gainer in the UK market. The company has been recommended in the marketing assignmentto improve global marketing by undertaking a campaign that will operate like an army camp. In other words, a global campaign manager should be appointed who will be responsible for communicating in diverse countries.

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