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RE-LAUNCH OF RC COLA

By:

AYESHA SANASAAD AHMED

SHABBIR

INTRODUCTION

HISTORY & BACKGROUND:

Developed in 1905 by Claude A. Hatcher, a pharmacist in Columbus, Georgia, United States.

The first product in the Royal Crown line was Chero-Cola in 1904, followed by Royal Crown Ginger Ale, Royal Crown Strawberry and Royal Crown Root Beer.

RC COLA IN PAKISTAN

RC cola was a very famous drink in Pakistan.

It was widely known all over the Pakistan since the time of its arrival in the sub- continent which was the 70s having the same popularity like Coca Cola and Pepsi today.

RC Cola was being sued by different organizations internationally so it lowered its investment in the sub-continent and in 90s; RC cola started to fade away due to some issues and stopped its production in Pakistan.

RC Cola is currently not operating in Pakistan and if RC Cola wants to re launch in Pakistan, it may face strong competitors like Coca Cola and Pepsi is ruling the cola market here in Pakistan.

REASONS FOR FAILURE IN PAKISTAN

Pepsi Cola and Coca Cola stormed into the market. Advertising was minimal in Pakistan as compared to its competition.

RC Cola was being sued by different organizations internationally so it lowered its investment in the sub-continent.

RC Cola failed in Pakistan because of its poor attention given towards the ad campaign.

It is also about how you present it, the looks of the product. RC Cola's bottle was not appealing and the regular one specially looked so thin, it seems as if it has less drink inside that is why the drink has reached its decline and rejection in Pakistan.

GOALS & OBJECTIVES

Launch and market a completely unseen-before beverage product, in order to achieve the following:

Create strong consumer awareness for RC Cola through the Product, Pricing, Promotion and Placement strategies.

Become the market leader in the functional drinks segment through sizeable market shares.

INDUSTRY PROFILE

The soft drinks market in Pakistan enjoyed dynamic growth with the passage of time.

Carbonates. Vegetable & fruit juices. Bottled water. Functional drinks. Concentrates. tea. Coffee.

SWOT ANALYSIS of RC Cola

Strengths:

RC Cola already existed in the Pakistani market and is already available in International markets hence the brand recognition already exists.

Carbonates have become part of the culture in Pakistan and thus the market can be penetrated if the taste is acceptable to consumers.

A good marketing strategy would help revive the brand.

Weaknesses:

Low advertising budget may not allow extensive advertising.

Distribution issues may affect the distribution of product throughout Pakistan.

Opportunities:

To build brand equity.

We can increase our market share due to Re-launching a product.

Come up with new line of product , perhaps catering to the needs of energy drink users.

Threats:  Very strong established

competitors i.e. Pepsi Co & Coca Cola.

  Shift in preference from

carbonates to energy drinks and among carbonates, low calorie beverages are preferred.

  The fact that RC cola faded

away in the early 90’s. People may already perceive it as a failed product.

COMPETITOR ANALYSIS

The major competitors in the market are:

  Pepsi. Coca Cola. Pakola. Apple Sidra. Mountain Dew. Mirinda/Fanta. Sprite/Teem.

CUSTOMER ANALYSIS

Demographics :  Age : 12 and above Gender : Both genders Social Class : Upper , Upper Middle , Middle Education : Undefined, but the segment we

are targeting is educated.

Location : Living in Urban areas Household Income: 20,000+ 

Geographic factor :

Country: Pakistan Province: Sindh City: Karachi Population: About 20 million

Psychographics:

The customers that we are targeting are youth and families.

Of course, the drink is for both genders.

Our consumers are also status conscious, and they want to associate themselves with high quality products.

ENVIRONMENTAL ANALYSIS

The current economic factors indicate low buying power and high inflation which would have a serious effect on demand and supply.

Currently youth is 60% of the market population, which suggests a huge target market in the country. Also with the increase in buying of carbonated drinks there is an opportunity to make profits.

MARKET-PRODUCT FOCUS

MARKET & PRODUCT OBJECTIVES: The objective is to re-launch RC Cola and with a big bang.

Coca cola has not been able to grab the market share in Pakistan due to distribution issues.

We need to capture the market that needs the cola drink with the crisp taste and not the sweet taste.

The market to begin with is youngsters and then family

oriented individuals.

In the prelaunch phase Billboards will be placed at strategic points such as universities, colleges and malls.

Also, stalls will utilize along with visual marketing by sponsoring bus stands and vehicles.

Online marketing will be a strong factor in promoting RC Cola.

Retailers will also be asked to provide eye shelf view to our product and we will also provide them with fridges.

We would also target university cafeterias in the initial phase and provide them stock at a lower price than the market.

The boom however will be created through TV and radio commercials.

TARGET MARKET

The target market of RC cola is firstly the youth because they are the major consumers of carbonated beverages.

Secondly, people who prefer the crisp taste of cola rather than a sweet taste.

Thirdly , the people who are family oriented ….regardless of gender….who like to have a good time with family and enjoy having soft drinks with the meals.

POINT OF DIFFERENCE

There are two major competitors in the market , Pepsi and Coca Cola.

RC Cola is a cola with a crisp taste and differs from Pepsi completely in the taste.

Coca Cola is not available everywhere …whereas we intend to make sure RC Cola is available in all areas of Sindh.

POSITIONING RC Cola will be positioned in a

manner that is in reach of everyone.

The taste will be of real cola and not a sweet taste.

It will cater to the needs of youngsters by giving them a strong taste and also be promoted as a family drink which can be used in festivities and on occasions along with the daily life.

We intend to associate fun and flavor. The initial aim of course is to penetrate into the carbonated drinks market.

MARKETING PROGRAM STRATEGY AND TACTICS

PRODUCT STRATEGY: The company will strive for excellence

specifically for the products or brands as well as packaging, distribution, marketing and pricing.

By celebrity endorsements such as with pop stars and cricketers, it helps the brand to be able to keep up with its competition.

We will get into deals to use RC Cola logos in all advertising, packaging, merchandising, and promotions.

We will build a reputation as appealing to the teenage audience; the reason behind this is to attract the younger audience.

MARKETING MIX

1) Product:

Some modifications will be done with the shape of the bottle specially the regular bottle because it seems to be thin and having lower volume compared to other cola-drink bottles.

Just two categories will be launched, which will be RC Cola in regular bottle and in a can to make the product more focused.

RC Cola has a unique crisp and clean taste and it’s consistent with its flavor no matter where you buy it.

It has a refreshingly great taste even if it is not cold.

We will maintain the same taste however bring a new look to the bottle so that the product can be perceived as new.

2) Price:

Following factors RC Cola should keep in mind while determining the pricing strategy.

Price should be set according to the product demand of public.

Price should be that which gives the company maximum revenue.

Price should not be too low or too high than the price competitor is charging from their customers otherwise nobody will buy their product.

3) Place:

We will use push strategy for our product by using various promotional tactics and through media.

Distribution will be divided in zonal basis, which will be 4 in number.

We will directly approach retailer by providing credit facility and bonus in form of incentives.

We will also provide trade allowances to our distributors and retailer to further intensify usage of push strategy.

RC Cola initially will be available at all general stores, super stores, convenience stores, supermarkets, hotels and restaurants.

We have divided the Karachi areas into two markets, Primary and Secondary to target the market geographically.

4) Promotion: Frequency of the RC Cola ads will vary from time to

time. When the summer season comes RC Cola will do heavy advertisement especially in Ramadan days or Eid occasions etc.

Incentive to Retailers will be given in the shape of: Deep Freezers, Return Tickets, Free Transportation Services.

Online Ads and Radio Ads will alsoe be focused on to grab maximum attention.

RC Cola will give special offers to consumers on special occasions like Ramadan and Eid days like decreasing the price of the products, some special packs like Pakora Mix, Chat Masala, or Free Glass with Liter Bottles can be offered.

Other promotional activities may include:

Getting shelves. Eye Catching Position. Sale Promotion. UTC Scheme.

“JO DIKHTA HAI WHO BIKTA HAI”

BTL: BTL activities can be done in different

shopping malls and crowded places.

ATL: Newspaper. TV. Radio. Billboards. Online.

PROMOTIONAL ACTIVITIES

Pre-Launch Activities: The use of teasers on billboard and

through radio will be used to create a hype about the product, tag lines such as “The real Cola is back in town” will attract consumers.

Launching of Product: The launch of the product will be on 14th Feb

2012 at Expo in a concert.

The day of launch will be full of fun filled activities sponsored by the company along with the official launch where families would be allowed to come in.

The evening would turn more festive with the concert.

The purpose of launching the product on Valentine’s Day also has significance.

This would help attract youth and at the same time give us a chance to introduce the pack to masses.

Post Launch activities: As part of the post launch activities , we would

concentrate on improving the distribution channel.

The teasers on the bill boards would be replaced with “Be Yourself” and the image of the drink , that would help boost the consumer awareness.

We will continue using the electronic and technological media for promoting the product, and try to get sports and other celebrities to endorse the product.

SALES PROMOTION ACTIVITIES

RC Cola Cricket. RC Cola Food Mela. RC Cola Concerts. RC Cola Basant Festival. RC Cola Shopping Festival. RC Cola Ramadan Campaign.

Start-up Cost

Requirements

Plant and Machinery Rs 15,000,000

Labor Rs 440,000

Delivery Vehicles Rs 3,000,000

Advertising Cost Rs 22,000,000

Rent Rs 600,000

R&D ( Innovative Ideas) Rs 15,000

Consultants (Marketing , Financials) Rs 500,000

Generator Rs 250,000

Test Marketing Rs 200,000

Teasers Rs 900,000

Concert - Product Launch Rs 3,000,000

Raw Material Rs 2,000,000

Total Start-up Expenses Rs 47,905,000

Startup Cost

Net Sales 26935

Cost of goods sold 10754

Selling, general & administration expenses 10526

Other expense 392

Depreciation 1082

Earning before interests and income tax 4181

Net interest expense 152

Taxable income 4029

Taxes 1367

Net income 2662

Projected Income Statement (00)

EVALUATION AND CONTROL

Quality Control: In compliance with the PSQCA (Pakistan

Standards and Quality Control Authority).

Evaluation Analysis: We assess feedback from sales revenue,

and customers, and will adapt the product accordingly by maintaining positive dynamic, training managers & staff, and by upgrading the web site.

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