Market Potentiality of Grove Juice in India: PEST and Porter Analysis

This report discusses the market potentiality of Grove Juice in India by conducting PEST and Porter analysis. It identifies the major external market factors and competitive factors of doing business in India. It also recommends the most effective market entry strategy and marketing mix strategies for Grove Juice in the Indian market.

Running head: INTERNATIONAL MARKETING
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Executive summary
The aim of this report is to discuss about the market potentiality of doing business in India for
Grove Juice. In this report, the PEST analysis is being done to identify the major external market
factors of doing business in India. It is identified that huge population of India will help Grove
Juice to have more market opportunities. In addition, the competitive factors of doing business in
India are also being identified using the Porter five forces analysis. This report concluded that
joint venture strategy will be the most effective market entry strategy for Grove Juice in
operating in India. In addition, the elements of marketing mix are also discussed in this report,
which will further complement Grove Juice in enhancing the business in the Indian market.

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Table of Contents
Introduction......................................................................................................................................3
PEST analysis..................................................................................................................................4
Political........................................................................................................................................4
Economic.....................................................................................................................................4
Social...........................................................................................................................................5
Technology..................................................................................................................................6
Porter five forces..............................................................................................................................6
Marketing objectives.......................................................................................................................9
Identification of the target market.................................................................................................10
Demographic segmentation.......................................................................................................10
Geographic segmentation..........................................................................................................11
Behavioral segmentation...........................................................................................................11
Targeting strategy..........................................................................................................................11
Positioning strategy.......................................................................................................................12
Recommended entry strategy........................................................................................................12
Marketing mix strategies...............................................................................................................13
Product.......................................................................................................................................13
Price...........................................................................................................................................13
Place...........................................................................................................................................14

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Promotion..................................................................................................................................14
Conclusion.....................................................................................................................................15
Reference.......................................................................................................................................16

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Introduction
The 21st century is the age of changes and technological advancements. As a result of
this, all the companies are trying their level best to utilize all the available technological means
in order to satisfy their customers to the maximum level. However, it must also be noted in this
context that the customers are also becoming highly cautious. They are in search of the best and
the purest form of products. It has to be noted in this context that health conscious has become
the new trend and people all over the world are asking for a pure and natural product. Same is the
case in India. People in India are in search of some pure and fresh fruit juice. The two well-
known brands of soft drinks namely Pepsi and Coca-cola saw the setbacks in the year 2016.
People are becoming much influenced by the lifestyles of people living in the west. In this
modern day scenario, the customers are mainly in search of products that are devoid of any
artificial added preservatives (Reddi et al., 2015).
There is a huge demand for fresh and natural products in India. It is for this reason that
Grove juice, one of the well known fresh fruit juice brands Of Australia is about to enter India
with their fresh products. Among, many of their brands, they will be starting off their business in
India with the signature brand. Signature will bring a wide variety of fresh fruit juice for Indian
consumers (Rais & Sheoran, 2015). The best part of this company is that they provide purely
fresh and pure fresh products made from the finest fruits of Australia. Grove juice has been
working as one of the leading fresh fruit juice producers of Australia. They make sure that the
purity and the freshness of the fruits are not lost while they are being brought in the process of
production (grovejuice.com.au, 2018). The fruits are hand-picked while they are in their
optimum mature state and then thoroughly tested in the own laboratories. As there are huge

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numbers of health-conscious consumers in India, it can be said that Grove Juice will have good
scope for doing their business on India.
PEST analysis
Political
The political system refers to the Governmental scenario in the modern scenario. The
political scenario also includes the taxes, the political power and the kinds of tax policies that are
imposed by the government on the import and export of the goods. Being one of the largest
democracies it is enjoying a federal form of Government. The taxation policy is one of the most
important aspects that must be seen by any company that is about to start its business in India
(Garg, Goyal & Pal, 2017). As the taxation policy is well developed, Grove Juice can be assured
about the fact that they will not have to pay any unnecessary taxes in order to enter and sell their
products in India (Rajauria & Tiwari, 2017).
The political condition of India is more or less stable. It is for this reason that Grove juice
might use this as one of their strength. Privatization will also be used as a strength of Grove
juices while starting their business India. Privatization has led to less interference from the
political within the private enterprises (Wellard et al., 2015). As a result, if this, being a beginner
they will be able to carry on with their business without much interference.
Economic
The taxation system of India comes under the economic set up as well. The taxation
system of India includes different taxes or mandatory contributions that have to be made by a
business firm in India. These taxes include taxes like a central tax, corporate tax, central tax,

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employee’s state insurance, and many other such taxes. This will ensure that Grove juice is
above to carry on the business with proper safety and insurance. The tax system in India is
considered to be favorable enough for any business firm to expand. The low the rate of interest,
the more advantageous it will be for business expansion.
It must be noted that there has been a sharp improvement in the economic condition of
India. The country registered a GDP of $5.07 trillion in 2013 following a further improved GDP
growth rate of 5% in 2014 as compared to 4.35% in 2013. There has also been a reduction in the
liberalization, Industrial licensing, foreign capital and other such parameters. This will surely be
an advantage for Grove juice to expand their business in India.
Social
The social scenario of India is quite favorable for the business expansion of Grove Juice
in India. Indian customers have become very health conscious and are looking for fresh products
with zero added preservatives. There is in a sharp rise in the older population of India. Therefore,
it is a common fact that this age group will have a good demand for fresh health products
(Jayaram, Dixit & Motwani, 2014). Fruit juice is one of the healthiest products that they can get.
It has also been suggested by the ministers of India that the producers must add at least 2petcent
of fresh and natural fruit content in the aerated products like Coca-cola and Pepsi. However as
these brands have seen setbacks, the Indian customers are in search of some real, natural fresh
fruit juice. Therefore, this will be a good and positive point for Grove Juice’s business
expansion.

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Technology
India is one the most technologically advanced countries in India. They are upgrading
their technological base every time so that they can deliver the best services to their customers.
India has upgraded them not only with the IT but also with 3G and 4G technology. This will help
Fruit juice to develop a grip over the technological market (Kandachar & Halme, 2017). They
can convey about their offers, details of their products through the social media pages, apps and
other such aspects.
Porter five forces
Porter five forces analysis is important to determine the level and intensity of the market
competitiveness in doing business in India. In addition, this will help Grove juice to position
their products in the Indian market based on the intensity of the competitive forces (Dobbs,
2014). The following sections will discuss about the elements of the Porter five forces analysis
based from the perspective of Grove juice.
Threat of substitutes  Threat of substitutes will be high for Grove juice
due to the reason that there are number of other
brands already operating in the market (Van
Alstyne, Parker & Choudary, 2016).
 India is having global brands such as Tropicana
operating in the market. Thus, Grove juice will also
face competition from them also.
 Each of the competing products is similar in terms
of taste and looks. Thus, the differentiating factors

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for the customers are less (Skokan, Pawliczek &
Piszczur, 2013).
 It is important for Grove juice to have some sort of
differentiating factors to fend off the threat of
substitutes.
 Each of the brands operating in the Indian market is
being majorly perceived as fruit drinks by the
majority of the customers. Thus, the impact of
substation will be more for Grove juice.
Threat of new entrants  Threat of new entrants is also high due to the fact
that smaller brands can also operate in this market.
 In the Indian beverage market scenario, there is
already good number of small brands catering to
specific market. In addition, more global brands are
also intending to enter the market (Meissner &
Wulf, 2013).
 The more will be the threat of new entrants in the
market; the lower will be the profitability of Grove
juice.
 Thus, it is important for Grove juice to have diverse
product portfolio in doing business in India. This
will ensure that market presence and sales volume
will be more for them (Safa et al., 2015).

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Bargaining power of the buyers  Bargaining power of the customers will be high due
to the presence of high level of competition.
 Fruit drinks are included in the fast moving
consumer goods category and thus the switching
cost is less for the customers (Huang et al., 2015).
 Customers are having different options to choose
from with the presence of different fruit drink
brands across different price levels.
 Thus, in the Indian beverage market scenario the
price of the fruit drinks is highly influenced by the
market forces.
 Change in the price structure of the products will
determine the demand in the market for Grove
juice.
Bar gaining power of the suppliers  Bargaining power of the suppliers is moderate for
Grove juice in doing business in India. This is due
to the reason that Grove juice is heavily depended
on the sourced materials (Palacios-Marques, Soto-
Acosta & Merigo, 2015).
 It is reported that in their existing operation in
Australia, Grove juice is having own farmland,
which helps them to have lower dependability on
the external sources (Allram, Tate & Feitzinger,

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2013).
 In doing business in India, it is important for Grove
juice to have the same approach, otherwise the
bargaining power of the suppliers will be high.
 On the other hand, the brand value of Grove juice
will help to fend off the bargaining power of the
suppliers due to the reason that suppliers are
depended on these brands for their produces.
Competitive rivalry  Competitive rivalry is high in the Indian market.
 Global and premium brands are also offering
discounts to attract more customers.
 In addition, aggressive marketing and promotional
activities being initiated by the existing fruit drink
brands to stay ahead in the market (Chen et al.,
2015).
 It is important for Grove juice to position and
market their products in order to stay relevant in the
Indian competitive market scenario.
Marketing objectives

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In the above sections, the external business factors and competitive factors of doing
business in India are being identified and evaluated. Thus, it is now important for Grove juice to
set their market objectives accordingly.
 To be the market leader in the Indian beverage industry by having the major market
share. It is targeted that Grove juice will acquire minimum 15 percent of the market share
in India within the next 2 years.
 To have the larger market penetration and presence in the Indian market with target of
gaining minimum 10 percent of the total revenue of Grove juice from the Indian
operation in the next 2 years. It is also targeted that product variants will be increased to
five in the next 1 year.
 To increase the brand recall value of Grove juice by effectively communicating with the
target customers through involving different mediums. This will ensure that the brand
awareness of Grove juice in the Indian market will be high and it will further help in
pushing the sales of the new products in the market.
Identification of the target market
Identification of the target market is also important due to the reason that Indian market is
highly diverse in nature with having the presence of potential customers across different levels.
Thus, various segmentation variables will be used to identify the potential customers for Grove
juice.
Demographic segmentation
In terms of the demographic segmentation, customers between the age group of 12 to 60
will be targeted due to the reason that fruit juice is having social acceptance across larger age

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groups. Teenagers will be targeted as a healthier option over the carbonated drinks and older age
groups will be targeted based on the nutritional benefits of the fruit drinks (Cross, Belich &
Rudelius, 2015). Thus, the target age groups for Grove juice are wide and vast. In terms of the
gender, both the male and female customers will be targeted as fruit juice is having acceptance
among both the genders.
Geographic segmentation
In terms of the geographic segmentation, tier I cities will be targeted in the initial stage.
This is due to the reason that products of Grove juice will be positioned as a premium in the
market and thus the affordability of the customers will be more in the tier I cities only (Jacques,
Manaugh & El-Geneidy, 2013). However, in the later stage, tier II cities will be also be targeted
based on demand for their products.
Behavioral segmentation
Customers with having the intention for regular purchase will be targeted due to the
reason that it will ensure the steady inflow of revenue from the market for Grove juice. In
addition, customers with more frequent purchase trends will have higher level of loyalty and this
will help Grove juice to deal with the competitive scenario (Muller & Hamm, 2014). In addition,
customers seeking for quality and access will be targeted due to the reason that Grove juice will
provide premium and quality drinks in the market with no added sugar and preservatives. Thus,
the targeting this customer segment will help in meeting their expectations effectively (Venter,
Wright & Dibb, 2015).
Targeting strategy

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It is recommended that Grove juice should initiate both product differentiation and
market focus strategy in doing business in India. This is due to the reason that cost leadership
strategy will not be applicable for them due to their premium offerings. On the other hand,
initiation of the product differentiation strategy will further help in creating distinctive image
among the competitors and attracts the potential customers (Anderson & Xie, 2014). In addition,
initiation of the market focus strategy will help Grove juice to determine the taste and preference
pattern of the target customers and offer them products accordingly. This will ensure that the
products of Grove juice are in accordance to the requirements of the target market and brand
loyalty for the customers will also be more.
Positioning strategy
It is recommended that Grove juice should position their Signature juice brand as a
premium offering in the market. This is due to the reason that Indian is market is more price
sensitive market and majority of the fruit juice brands are being listed as premium offerings.
However, the contents and quality are not at par to their pricing. Thus, premium positioning of
Grove juice along with offering the authentic quality will ensure that they will be able to have
more sales volume along with more profitability (Urde & Koch, 2014). In addition, it is also
being recommended that Grove juice should leverage on their rich and original taste of their fruit
juice as marketing positioning element. This is due to the fact that majority of the fruit juice
brands operating in the Indian market are having sugar and preservatives.
Recommended entry strategy
It is recommended that Grove juice should follow the joint venture entry strategy in doing
business in India due to have reduced risk of investments. In the case of joint venture, they can

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have the partnership with a local brand, which will further help in gaining the local market
competiveness. Initiation of the direct exporting strategy would have least risk for Grove juice
but it will increase the cost of the end products in the Indian market (Sun & Lee, 2013). Thus,
with the help of the joint venture strategy, Grove juice should have own farmland in India, which
will help them to provide the authentic local taste to the customers along with having the
opportunity for competitive pricing in the market.
Marketing mix strategies
Product
It is recommended that Grove juice should have diverse product offerings in the Indian
market. This is due to the reason that the more diverse will be the product portfolio of Grove
juice, the more will be the opportunities of targeting different customer segments. It is
recommended that in the initial stage, the premium Signature brand should be launched in the
market in different flavors. This will help to cater to different taste pattern of the customers. In
the following stages, Grove juice should also launch their mass market drinks to leverage on
their gained brand value in the Indian market. Introduction of the mass market brands will help
Grove juice to target the customers across different price levels and increase the sales volume in
the long term.
Price
It is recommended that Grove juice should follow market based premium pricing strategy
in doing business in India. This refers to the strategy of offering the products at a premium
compared to the market determined price. This is due to the reason that fruit drinks are perceived
as premium products in the Indian market and initiation of the premium pricing strategy will

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ensure that customers will have favorable brand image towards Grove juice in accordance to the
concept of price portrays the quality of the items. Initiation of the premium pricing strategy will
further help Grove juice to have more profitability in selling their products. This will also enable
them to push their mass market products in the following stage after the gaining the favorable
market image by operating in the premium category.
Place
It is recommended that Grove juice should initiate Omni Channel distribution strategy in
doing business in India involving both the offline and online mediums. This will help in reaching
out to more number of target customers effectively. In addition, the extensive distribution
strategy should also be initiated by Grove juice in order to make their products available in
different stores ranging from hypermarkets to convenience stores. Thus, the product visibility
will get increased with the help of this strategy. Initiation of the online distribution strategy will
help Grove juice to add more convenience to the customers and this will also provide a
competitive edge over their competitors in doing business in the Indian market.
Promotion
In the case of promotion also, Grove juice should initiate Omni Channel promotional
strategy involving both offline and online mediums. It is recommended that Grove juice should
have effective mechanism of social media marketing to the two ways communication process
with the target customers. Initiation of the social media marketing as a promotional tool will
further help Grove juice to determine the feedback of the customers for their products and
change the product strategy accordingly. Print and television media should be used from
traditional promotional mediums to reach out to larger customer segments.

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Conclusion
Therefore, it can be concluded that the entry of Grove Juice in India will be very
beneficial for the Indian consumers. This is because Grove Juice comes with the apt products
that are in huge demand for the people of India in the current scenario. The PEST analysis that
has been done in this report shows that the current political, economic, social and technological
factors of India seem favorable for the business expansion of Grove Juice. Apart from this, it has
also been seen from the marketing mix that if all the plans and policies are implemented
properly, Grove Juice will certainly get a proper advantageous scenario for expanding their
business in India.

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