Marketing Strategies For Sanitarium's UP&GO Brand Essay.

Choose a branded product range that are distributed through supermarkets like Woolworths, Coles or IGA in Australia that is supplied by a large manufacturer of branded grocery products, such as Unilever, Proctor and Gamble, or Sanitarium. Your company has decided to launch a new product into Australian supermarkets under one of the company’s established brands. The new product can be a modification of an existing product, or a product extension under an existing brand.

- Summarise key facts about this company’s Australian business — ownership, sales, product ranges, management, profitability, share price history, and so on.

- Describe the chosen market segment — sales, growth, major competitors and their market shares.

- State your rationale for introducing a new product to extend the range. Your analysis must detail relevant trends and show why the marketing environment is positive for this new product.

- Define the target customer for this product — demographically, geographically and psychographically.

- Outline your marketing mix strategy.

About Sanitarium Australia

The report would effectively focus on evaluating Sanitarium, a known fast moving consumer product company operating in Australia along different related parameters. Further, it would focus on designing a marketing mix for marketing a new product segment with existing product lines of its UP&GO brand by evaluating the consumption trends in the region regarding the new product category.

Sanitarium Health Food Company became registered as a pioneering organisation in the health food sector during April 1898. The organisation is owned by Seventh-Day Adventist Church based in Australia that focuses on both producing and also promoting health foods developed from plants as outlined in the Bible (Sanitarium Health and Wellbeing 2018).  

During 2016, Sanitarium is recorded to generate a sales turnover of around 150 million AUD. During that period, Sanitarium contributed in serving healthy products to around 500 million customers (Food&Beverage 2017).

Sanitarium offers a range of diverse products like breakfast cereals under the Weet-Bix brand and other flavoured cereals associated to Light n’ Tasty range, mueslis and crisp cereals that help in generating customer delights, liquid breakfast cereals under the UP&GO Brand, dairy free milk products and ice creams and also different types of spreads like peanut butter (Sanitarium 2018). The product range for UP&GO liquid cereal products is presented as under.

                                                                                        (UP&GO 2018)

Sanitarium is presently headed by Rob Scoines, operating as the General Manager of the firm. Scoines’ wealth of avid leadership and collaborative potential contributed in the generation of an effective and high performing team culture in the firm (Food&Beverage 2017). The management of the firm ideally focuses on rendering value and respecting the needs of its employees. Further, training and knowledge development are continually encouraged in the firm for enhancing the potential of the employees to combat external changes. Sanitarium’s management strongly focuses on developing and fostering a two-way communication culture both through physical and virtual meets. The management of the firm also encourages its employees to work in a goal-oriented environment that helps them in reviewing the performances of the staffs annually or half-yearly (The Australian Business Awards 2014).  

During 2015, Sanitarium Health and Wellbeing is recorded to earn a profit amount of around 192 million AUD. The level of profit gained by the company reflects a 2.3 percent increase from that gained by the firm during 2014 (NZ Herald 2015).

The sales revenues generated by the Australian cereals market during 2018 amounted to $508 million. The sales revenues are expected to gain an annual growth of 3.9 percent along the period ranging from 2018-2021. In terms of per-capita revenue generation the amount was estimated to be $20.54 during 2018 while the per-capita consumption of breakfast cereal products amounted to 2.4 kilograms (Statista 2018). Further along the periods ranging from 2012 to 2017, the market for breakfast cereals in Australia recorded a growth rate in terms of compound annual figures at 4.57 percent while sales value during 2017 recorded AUD1706.37 million which was around 4.24 percent greater than the sales revenues generated during 2016. The cereal market in Australia reflected the highest performance during 2015 in terms of countering a growth by around 4.84 percent than the sales revenues gained during 2014 (Market Research Reports 2018).

Description of Chosen Market Segment

The breakfast cereal market of Australia is essentially governed by Kellogg wherein during February 2016 the company launched its first gluten free version. Other competitors in the market were local cereal production companies like Freedom Foods Group and also the Monster Health Food Co. The competitors in the market expect growth of new entrants in the territory which in turn would further enhance the competitiveness (Best 2016).

During 2017, Kellogg tended to command a 30 percent market share in the Australian breakfast cereal market. The same however countered a decline owing to the emergence and gradual growth of local cereal producers that positioned their products in the health category. More specifically, Kellogg commanded a 50 percent market share in the market catering for children’s cereal products during 2016 which amounted to around 48 percent during 2017 (Euromonitor International 2017). Nestle commanded a 25 percent market share in the Australian cereal market during 2014 (Market Research Reports 2018).

The UP&GO brand marketed by Sanitarium is required to focus on marketing dry fruit products under its banner. The level of consumption of dry fruit products by Australian consumers across the period ranging from 2012 to 2016 is reflected in the following illustration.

                                                                                 (Statista 2018)

The consumption of dry fruit products in metric tonnes gained an increase during 2016 compared to 2015 thereby reflecting the growing consumption habits of dry fruits by Australians. The dried fruit consumption habits in Australia reflect increased intake of dried grapes or raisins, apricots, banana chips, pieces of pineapple and also different types of nuts (Statista 2018).

The target market for dry fruit products in Australia encompasses children customers that need to be given nutritious foods for aiding their growth and development, the millennial customer groups that are now becoming increasingly health conscious, women customers and working professionals that prefer to consume healthy snacks rather than fast foods and finally the elder customers that are highly health conscious in nature (NZ Herald 2015).

An effective product mix for dry fruit products tends to encompass different types of nuts like almonds, cashew, walnut and pistachio. Apart from such other products like raisins, apricots, figs, prunes, dates, pineapple and banana pieces are included (America Dry Fruits 2018).

Dried fruits to be marketed under the brand umbrella of UP&GO would require Sanitarium to focus on employing penetration pricing strategy. The application of penetration pricing would help the firm in gaining rapid expansion along the Australian market for dry fruits (Simon 2015).

In terms of place mix, Sanitarium can effectively focus on using a combination of traditional distribution channels involving wholesalers and retailers and also the use of electronic and mobile commerce for effectively reaching the products to a larger audience. The application of electronic and mobile commerce would encourage customers in viewing, sorting and booking orders based on their convenience (Simon 2015).

Sanitarium is required to use a wide variety of channels like broadcasting (television and radio), print (food magazines and newspaper advertisements-half and full page advertisements), social networking platforms and also outdoor media for generating increased awareness about the dry fruit packages marketed under the brand UP&GO (Food&Beverage 2017).

Conclusions

The report highlights the fashion in which Sanitarium a well known consumer product company based in Australia can effectively market its new launch dry fruit products to Australian consumers under its existing brand, UP&GO. The marketing mix is planned based on carrying out a trend analysis of consumer demand for dry fruit products in the region.

References

America Dry Fruits 2018, Dry Fruits, viewed 6 September 2018, <https://www.adfs.in/dryfruits/dry-fruits.aspx>.

Best, D 2016, Navigating Australia's maturing gluten-free breakfast cereal market, viewed 5 September 2018, <https://www.just-food.com/analysis/navigating-australias-maturing-gluten-free-breakfast-cereal-market_id133215.aspx>.

Euromonitor International 2017, Breakfast Cereals in Australia, viewed 5 September 2018, <https://www.euromonitor.com/breakfast-cereals-in-australia/report>.

Food&Beverage 2017, Sanitarium NZ gets new boss, viewed 5 September 2018, <https://foodmag.com.au/sanitarium-nz-gets-new-boss/>.

Market Research Reports 2018, Breakfast Cereals (Bakery & Cereals) Market in Australia - Outlook to 2022: Market Size, Growth and Forecast Analytics, viewed 5 September 2018, <https://www.marketresearchreports.com/globaldata/breakfast-cereals-bakery-cereals-market-australia-outlook-2022-market-size-growth-and>.

NZ Herald 2015, Sanitarium safe from charity crackdown , viewed 5 September 2018, <https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11406105>.

Sanitarium 2018, Our products, viewed 5 September 2018, <https://www.sanitarium.co.nz/about/sanitarium-story/products>.

Sanitarium Health and Wellbeing 2018, Profits for charitable purposes, viewed 5 September 2018, <https://www.sanitarium.com.au/about/sanitarium-story/profits-for-charitable-purposes>.

Simon, H 2015, Confessions of the Pricing Man: How Price Affects Everything, Springer, United Kingdom.

Statista 2018, Annual consumption of dried apricots in Australia from 2012 to 2016 (in metric tons), viewed 6 September 2018, <https://www.statista.com/statistics/870703/australia-dried-apricot-consumption/>.

Statista 2018, Breakfast Cereals, viewed 5 September 2018, <https://www.statista.com/outlook/40090100/107/breakfast-cereals/australia>.

The Australian Business Awards 2014, Sanitarium Health and Wellbeing, viewed 5 September 2018, <https://www.businessawards.com.au/winners/2014/Employer-of-Choice/Sanitarium-Health-and-Wellbeing.php>.

UP&GO 2018, Product Range, viewed 5 September 2018, <https://www.upandgo.com.au/our-products/>.