Marketing Strategies For Kraft's Vegemite In Thailand Essay.

Strategic Analysis of Thailand

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The company Kraft Foods International of Australia is trying to target the market of Thailand for the export of their commodity Vegemite that is a food paste with a rich dark brown texture, which is made from the yeast extracts of the leftover breweries. Along with that, there are other spices and vegetables added. Cyril P Callister in Victoria of Melbourne city developed this product in the year 1922.  This is a spread used on the toast, sandwiches, cracker biscuits, crumpets and for the filling in the pastries.  Vegemite of Australia is similar to that of the Marmite of Britain, South Africa and New Zealand. The company Mondelez International now owns this brand, an US based company.  The company wants to extend its products to Thailand so the marketing team of Kraft wants to focus their strategy for reconnecting of the brand Vegemite with the customers.  The objective of the company is to renew the brand so that it helps in increasing the number of household consumption and reconnecting with the consumers. In this paper, political, economic and socio-cultural aspect is framed for the country Thailand; the competitors the company is going to face in the Thailand market and marketing strategies are discussed in detail.

• Political: The country Thailand is called the Kingdom of Thailand. There is constitutional monarchy in Thailand. However, the King is the head of the state but there is very little direct power but this also involves the symbol of identity and unity. The Promotion and Enhancement of the Environmental Quality Act of 1975 has led to many programs related to the environmental protection. The programs of the protection were made as per the issues that were faced by the nation. The main issues that are faced are the water pollution due to the wastes from the factories, air pollution from the vehicles, erosion, deforestation, national wildlife that is threatened due to illegal hunting. The corporate tax in the country is maximum 30% and the Value added Tax is 7%. When looking into the exports of the product by Thailand the exports mainly ranges from textile, food products, fisheries, computer, rubber, jewellery and many more.
• Economic: The overall economy of Thailand is seen to be increasing since the year 1997-1998 i.e. after the Asian Financial Crisis. The economy has witnessed growth of 6.9% in the year 2003 while it dropped to 0.8% in the year 2004 but still there was improvement. The country to boost its exports and the growth has established many trade agreements. The apparel and the textile industry of Thailand are doing very well. The most import commodities that are exported and imported are the textiles. When there are more products from the United States, being imported where there is more power in dollars (Blythe, 2012). There are all forms of transportation available in Thailand. Metro high ways, ports, harbours, airports, waterways and the three-wheeled taxis called the ‘tuk –tuks’ are available in all parts of the country. The geographical location of the place helps in making it accessible through the sea.  The majority of the exports in the country is made from the United States through it is time consuming and costly (Sheehan, 2011).
• Social and Cultural: The income distribution of the country in Thailand is near to equal as per the Gini Index Rank, which is 42. The population of the country Thailand is 65068149 where the age group of 0-14 is 21.6%, 70% of the population is between the age group of 15 to 64 years and the age group of 84 and above is 8.2% of the total population. When considering the population , the sex ratio in the total population is 0.98 males per females. The average schooling of the adults is 6.5 years with the life expectancy of the school years is 10.8 years.92.6% of the population has the ability to read. Thai fashion mainly focuses on detail even when there is mix of the traditional with the modern trends (Winer & Dhar, 2011). Work is treated as necessary for keeping the economy growing while leisure is not that popular among the population of Thailand.

When the company Kraft enters into the market of Thailand then there are many other competitors who are present who are local groups selling similar type of spreads to the people of Thailand. The major competitors of the company are as follows:

• Pure Foods: The Company Pure Foods offers products for healthy salad dressing, sandwich spread, sauces and different types of fillings. Pure Foods Co Ltd and the Win Win Foods Ltd is located in the Sam Chuk District in Suphanburi Province. The area covered by the company is 12300 square metres and the capacity of production of 600 tons in each month with some modern manufacturing machines. The products are made by taking into consideration the well-being and the health of the consumers so that the products are made meticulously in each step so that there is both taste and quality. There are different types of products made by the company for the local consumers and abroad. The focus of the company is to grow the food industry business through the service, quality, management and environment. The company would also implement international standards.

• Kewpie: In the year 1981 , The Kewpie Corporation  and the Saha Pathana Interholding Company Limited  after and agreement to manufacture mayonnaise in Thailand under the brand name Kewpies that was established in the year 1987. The operations were relocated to the area of Bangpong District by leasing out of the Preserved Food Organization Factory from the government of Thailand. The main motto of the company is to enjoy, working and share happiness. The company always strive for originality and ingenuity.  The company Kewpie is committed to provide healthy spreads and dressings for adding kindness, uniqueness and good taste for able to reach the table of each country. The company wants to become the most sorted and the trusted company among the customers (Kotler & Keller, 2012).

There are three types of sandwich spreads that are available they are the sandwich spread, corn spread and the chicken flavoured spreads and many more.)

• Heinz Thailand: Heinz creative foods have its presence all around the world. Heinz is used synonymously with ‘Ketchup’ in the United States The Company Heinz is a leader in the production of infant products, frozen potatoes and sauces and much more. The products of Heinz is available in 200 countries in the Asia pacific region , Europe and North America. The company has its head quarter in Pittsburgh, United States. This is a US based food products company. The reputation and brand has spread it across more than 200 countries. The food products of Heinz are delicious, convenient and nutritious and are among the top brands in the market (Kotabe & Helsen, 2011). 

Apart from being renowned for the ketchup, there are wide variety of spreads also available in the market of Thailand.

Pricing Strategy:

The people of Thailand will price the price of the vegemite reasonably as per the affordable capacity (Dahlstrom, 2011). The price of the 400 grams of the container will be quoted as 4.98 dollars while the 125g container will be priced at 2.98 dollars

The price range of vegemite is same as the price range of peanut butter, mayonnaise and the variety of spreads by the other competitors.

Distribution Strategy:

The product Vegemite will be distributed across the three segments of the people in Thailand they are Moms, families and the young group of children between 5 years to 12 years.

The families are seen to buy more of healthy breakfast spreads .The mothers are targeted as they are the ones buying the weekly grocery and they care about what the children they put in their mouth. Children they love having it by spreading them across the bread (Clow & Baack, 2012).

Promotion:

The product Vegemite can be sold in Thailand through different type of promotional techniques. The sales promotion will help in increasing the sales by providing off on the products. The shelf displays through keeping the products side by side and forming a tall yellow vegemite wall, which makes the customers to easily notice. In order to promote the product, celebrities like Justin Bieber can be chosen for promoting the product among the young age group. Personal selling will be done when a sales person handles the customers and provides them with the description of the products (Chernev, 2012). The commercials on the television will help in appealing the target market.

Conclusion:

The Company Kraft when it introduces the product Vegemite in Thailand then it would be facing a tough competition, as there are more competitors who are seen to sell the similar type of the products in the market. This is the reason there is a need of some marketing strategies so that they are able to gather a large market share. The product will be targeted for the families, moms and the children who prefer them in their breakfast, as it is a healthy choice. There are different marketing techniques like individual selling, commercials, shelf displays are some marketing tools used by Kraft to promote Vegemite in Thailand.

References

About Heinz - Heinz - ไฮนซ์. (2016). Wcf.co.th. Retrieved 24 May 2016, from https://www.wcf.co.th/heinzthailand/about/

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Clow, K. & Baack, D. (2012). Cases in marketing management. Thousand Oaks, Calif.: SAGE.

Dahlstrom, R. (2011). Green marketing management. Mason, Ohio: South-Western / Cengage Learning.

KEWPIE. (2016). Kpthai.com. Retrieved 24 May 2016, from https://www.kpthai.com/kewpie/index.php/page/about/history

Kotabe, M. & Helsen, K. (2011). Global marketing management. Hoboken, N.J.: Wiley.

Kotler, P. & Keller, K. (2012). Marketing management. Upper Saddle River, N.J.: Prentice Hall.

Mondelez ANZ. (2016). en. Retrieved 24 May 2016, from https://www.mondelezinternational.com.au/

Purefoods เติมเต็มสิ่งดีๆ ด้วยรสชาติที่ตรงใจ. (2016). Purefoodsthailand.com. Retrieved 24 May 2016, from https://www.purefoodsthailand.com/sandwich_spread.php

Sheehan, B. (2011). Marketing management. Lausanne, Switzerland: AVA Pub.

Winer, R. & Dhar, R. (2011). Marketing management. Boston: Prentice Hall.