Sales Management

1. 1. Sales management is the discipline of maximising the benefits a company and its customers receive from the efforts of its sales force. 
   2. Glaxo spends less than 4% of sales on research and development in the consumer unit, compared with 15% prescription drugs. Horlicks, in India, sold twice as much as Thumbs up soda and earned 50 % more revenue than Tata tea.There is a huge demand of nutrition-related products in India because of high malnutrition rates among the Indian population. . The company plans to spend as much as £40 million ($62 million) to boost production capacity at its three Horlicks plants in the country. Glaxo’s consumer health sales in India totaled about £350 million, or 9 percent of global sales for the division, in the nine months through September. Worldwide sales including pharmaceuticals were £20.4 billion in the period.

Branding

Branding is the marketing practice of establishing a name, design or symbol that identifies and differentiates a product from other products.  

• Nutrition is the core of all Horlicks products. It is the symbol of strength, nutrition and power in India. 
• Even for its new products it is using the same brand promise because the purpose remains the same. 
• This helps the brand to grow bigger. 
• Horlicks is a brand the consumer is satisfied consuming it but there are chances of these consumers switching the brand even if there is minute changes in the price of Horlicks.

Segmentation, Targeting and Positioning

Segmentation is the process of sub-dividing a whole market in different groups or subsets.
The market of Horlicks is segmented as follows:

GEOGRAPHIC SEGMENTATION- In the northern part of the country, it has a huge demand as a white drink whereas chocolate horlicks is very popular in the southern part of the country.

DEMOGRAPHIC SEGMENTATION-  Here the market is segmented on the basis of the age groups.

• Junior horlicks- for preschool children
• Horlicks regular- for general use
• Women's horlicks-for pregnant and breast feeding women 
• Horlicks Lite-  for health conscious adults and for diabetic people
• Chocolate and other flavored horlicks- for teenagers

Once the firm has segmented the total market, it should select the target market segment or segments for marketing. This is called targeting. 
Horlicks currently focuses on one segment of market that is children between the age group of 8-14. This is so because children have a huge influence on the products purchased for the family. The focus of Junior Horlicks continue to be the kids between one and three while all the action will be in general Horlicks. 

Positioning of a product or service is creating an image in the consumer's mind. 

• Horlicks was initially introduced as both an additive and substitute to milk and positioned itself as a nutritional supplement for the kids.
• In 2003, it positioned itself as a "pleasurable nourishment" by launching its vanilla, honey and chocolate variants. 
• It adopted a new positioning strategy via product packaging which now carries a logo ,'taller, stronger, sharper." 
• Junior horlicks brand has positioned a product exclusively for children of the age group 1-3.
• Today, the brand talks to each member of the family. Its objective is to cater to the needs of all the age groups.

Promotions

Promotions refer to the entire set of activities that communicate the product, service or brand to the user so as to increase public awareness or sales.

• To reach the rural masses in India, Horlicks started promoting its products through radio ads in 1960-70 that had the voice-over of Amitabh Bachhan. This is still effective in the villages of Bihar and Orissa. In other rural areas, Horlicks is promoted through banners and hoardings.
• In 2005, it came up with a very interesting TV advertisement stating that Horlicks makes you "taller, stronger and sharper". This proved to be a great hit among the viewers. Before launching this campaign, it conducted a clinical trial in Hyderabad with around 869 students.

•  During this year, Boman Irani promoted its product Horlicks lite.
• Ninja Horlicks is promoted by the kid artist, Darsheel Safari.
• Horlicks launched a inter school fest called the whiz kids in 25 cities targeting school children.
• It organised magic shows in rural areas called Video on Wheels in order to promote its product.

Distribution

Distribution can be defined as spreading the product throughout the market place in a way a large number of people have access to purchase it.

•  Horlicks have three manufacturing units and seven packaging units in India, located in Nabha (Punjab), Sonepat and Rajamundi (Andhra Pradesh).
• It has a strong distribution channel comprising of 4800 wholesalers and directly covers over 700000 retail outlets.
• The packaging is done differently in different packaging units spread across various states to save the transportation costs. The powder is distributed in bulk quantities here which is then bottled and packaged and supplied to the distributors.
•  Horlicks initially had a chain of 500 big chains but now it also has a second layer of distributors in the smaller towns to supplement it. Most of these 4000 sub distributors were appointed in the western and southern parts of the company. 

Marketing strategies (4 P's) of Horlicks

PRODUCT: 

• Junior Horlicks.
• Women's Horlicks.
• Mother Horlicks.
• Horlicks Lite.

PLACE:

• 1800 wholesalers and direct coverage of over 4,00,000 retail outlets.
• South and eastern markets that contributes about 46 %  of the total sales.

PRICE:

• Rs. 90/200 gm and Rs.170/500 gm which is less than its competitors. 

PROMOTION:

• Both traditional print and TV media.
• Doctor Engagement Program wherein the company reaches out to physicians, dietitians and nutritionists to educate them about the product.
• Horlicks has launched a fun and informative website (www.myhorlicks.com) for kids (6-16) and mothers.
• The latest campaign of Lite.
• Tie up with the IPC magazines to offer free magazine.
• Philanthropic activity: Aahar abhiyan.
• Medical platform by labeling the product as "clinically proven". 

Product level

Different product levels of Horlicks are as follows:

1.CORE PRODUCT- The service or benefit the customer is really buying.

• Flavored milk drink

2.BASIC PRODUCT- At the second level, the marketer must turn the core benefit into a basic product. 

• Tasty and nutritious health drink.

3.EXPECTED PRODUCT- A set of attributes and conditions buyers normally expect when they purchase a product.

• Different flavors.
• Nutrition supplement.
• Packaging in durable bottles.

4.AUGMENTED PRODUCT- At this level the marketer prepares an augmented product that exceeds customer expectations.

• Brain developing and Bones protecting drinks for women and babies.

5.POTENTIAL PRODUCT- This encompasses all the possible augmentations and transformations the product might undergo in the future. 

• Special sweet health drink for diabetes patients.

Product Life Cycle

Like human beings, products also have an arc. From birth to death,human beings pass through various stages e.g. birth, growth, maturity, decline and death. A similar life cycle is seen in case of products. PLC has to do with the life of a product in the market with respect to business/ commercial costs and sales measures.

The four stages of product  life cycle of horlicks are as follows:

1.INTRODUCTION STAGE- 

•  Horlicks a brand was established before 6 decades back in 1960.
• It is owned by GlaxoSmithKline consumer health care.
• It was heavily advertised as a kid's nutritional drink.
• It was a substitute of "Milk" as baby food.
• It acquired more than 50% market share in Indian milk beverage market.

2.GROWTH STAGE-

• Excels at delivering the benefits truly desired by customers.
• Pricing strategy based on 'value for money'.
• Proper positioning.
• Consistency.
• Creating entry barriers.

3.MATURITY STAGE-

• Product quality.
• By winning trust of consumer.
• By getting better labels than its competitors.
• By getting a tagline such as ,"taller, stronger, sharper" that got stuck  in the mind of  consumers for years.

4.DECLINE STAGE-

Horlicks has yet to go through the decline stage. However the other nutritional drinks such as milo, bournvita, complan etc offer a great competition to horlicks and may soon push it to the reaches of the decline stage.

Consumer Decision Making Process

Consumer decision making process is a five-step process used by consumers when buying goods or services.

1.Need Recognition- is the result of an imbalance between actual and desired states that arouses and activates the consumer decision-making process. 

It is triggered when a consumer is exposed to an internal or external stimulus.

In case of horlicks:

• Internal stimuli-hunger,thirst.
• External stimuli-design of the package, recommendation of existing users, brand name, TV advertisement.

2.Information search- after recognizing a need or want, consumers search for information about the various alternatives available to satisfy it. The alternatives available for Horlicks are Bournvita, Milo, Complan etc.

3.Evaluation of alternatives- the environmental,internal info., and external info. help consumers evaluate & compare these alternatives.

4.Purchase- Ultimately the consumer has to decide whether to buy or not to buy. A consumer will prefer to purchase horlicks because of its low cost & best quality. Also,unlike other health food drinks, it offers a variety of flavors to choose from.

5. Post purchase behavior- when buying products, consumers expect certain outcomes from the purchase. A consumer purchasing Horlicks will expect it to maintain its taste & quality without compromising with the nutrition that it provides.

Competition and Industry

It is a 135 year old brand constantly reinventing itself. Horlicks has long been the favorite health drink of India. The brand commands above 50%  market share in Indian Health Drink industry which is valued at around Rs 1300 crore.

It is dominating the Rs 2200 crore malted food drinks (MFD) market, enjoying steady growth and 52.6% of the market share.

COMPETITOR ANALYSIS:

Horlicks vs. Complan

• Heinz Complan is its nearest competitor.
• Complan provides its consumers with the necessary nutrients all round growth, but due to the fact that Horlicks was the first to come out with various flavours, which ensured its current market position.
• Horlicks has always been able to price itself lesser than the competition, thus being able to appeal to the price conscious Indian consumer.
• Complan has never reinvented its product design while Horlicks attracts the consumers (mainly children) with its attractive design. Each of its products has a consumer centric design , e.g. Junior Horlicks has animalistic design to target infants, Women's Horlicks it's shaped as a slim healthy lady and in a feminine red colour.

Horlicks vs. Bournvita 

• Children always go for the tastiest option, and Cadbury Bournvita offers two options one being Cadbury Bournvita 5 star magic and the other being Cadbury Bournvita++.
• New Bournvita ++ offers taste and essential nutrients for all round growth.
• Horlicks beats Bournvita Five Star Magic by providing new flavors in chocolate, vanilla, honey etc.
• Horlicks edges over new Bournvita++ with their slogan "Exams ka bhoot bhagao" 

Product Analysis

1.Who buys this product?

Horlicks is sold in a number of countries across the world. In different countries, the product has different formulations in order to cater to the following consumer segments :

• Toddlers
• Kids
• Pregnant women
• Breastfeeding mothers
• New mothers

2.What problem will this product solve?

• Caters to nutritional needs of Indian diet.
• Helps meet the requirements of essential nutrients in children, such as irons & vitamins that aid iron absorption.
• Improves attention, concentration & memory as well as physical performance & growth of school age children.

3.Which attributes are important and why?

• NUTRITION SUPPLEMENT- Horlicks is the only health drink, clinically proven in India, to make kids taller, stronger & sharper. According to a test, the children who consumed Horlicks showed significant improvements in height, muscle mass , bone health & attention/concentration.
• DELICIOUS RANGE OF FLAVORS- Horlicks is available in a variety of flavors such as chocolate, vanilla, elaichi etc, giving the consumer a wide range of choice, unlike other health food drinks.
• RURAL REACH- 30-35% of Horlicks sales come from the rural market. It is trying to penetrate deeper into the rural market via satellite distribution chain & promotions. 

4.If this decision is first time, how will it go? If it is repeated, how will it go?

a) When the consumer will purchase horlicks for the first time, he will be pretty satisfied because of its proven results over the years. Also it has been successful to read the consumers and design the variants for each group. The results show the acceptance of the consumers towards the success of the segmentation venture.

b)  The benefits and brand are the key attributes that encourage consumers for the purchase of the product again & again. The only exception being Chocolate Horlicks whose attribute is taste. 

  

Customer Value

Value in marketing, also known as customer-perceived value, is the difference between the prospective customer's evaluation of all the benefits and all the costs of an offering and the perceived alternatives. 

If horlicks was a person, he would be healthy,trustworthy,family oriented and smart. That's what consumers perceive Horlicks to be. Other core values of Horlicks are as follows:

• Nutritious drink-"The Great Nourisher"
• Persistent product quality
• Different flavors 
• Strong distribution network
• Various innovation
• Interesting advertisement campaigns
• Regular feedback

Product overview- HORLICKS.

INTRODUCTION

Horlicks is the name of a company and of a malted milk hot drink developed by the founders James and William Horlick. It is now manufactured by GlaxoSmithKline in the United Kingdom, South Africa, New Zealand, Bangladesh, Pakistan, India, and Jamaica, and under licence in the Philippines and Malaysia.
In India, it is the leading Health food drink, and the 'Most Trusted Drinks brand'. (Economics Times Survey,2004). It enjoys more than half of the Health Food Drink market. The modern & contemporary Horlicks offers 'pleasurable nourishment' with a delicious range of flavours including Vanilla, Toffee, Elaichi and Chocolate.

Definition of marketing.

Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. (AMA 2013)


Marketing in the classical definition is business strategy. It's deciding what product to build for what type of customer, how to reach that customer for promotion and sales, and how to measure success. It encompasses product strategy, product management, product marketing, and marketing communications as well as field marketing and channel management.

As used in many businesses today, "marketing" is short for marketing communications, a department focused on promotional programs as well as brand management.