Case study of Almarai

Read this case study of Almarai to learn about SWOT analysis, 4P's of marketing, Porter's five-force analysis, and BCG matrix. Get insights into Almarai's product portfolio and more.

Running Head: ALMARAI 0
Case study of Almarai
System04122
2/20/2019

Almarai 1
Answer 1: SWOT Analysis of Almarai
Strengths:
 Leader in the dairy market
 High quality of dairy products
 Strong distribution network
 Hot climate conditions goo foe the
beverages market (Helms & Nixon,
2010).
Weakness:
 Operating cost is high
 Dependence on dairy and juice sectors
 Dependent on imports of raw material
Opportunities:
 Growth in the milk market of gulf
corporation
 Diversification in the products
 Increase in number of tourist visits
Threats :
 The political issues of the gulf region
 Increase in cost and problem in supply
chain
Answer 2: Four 4P’s of marketing for Almarai
Product:
It is one of the most important strategies of the company; Almarai has a very successful
product strategy because of the unique infrastructure like the farms and production operations.
The company distributes the products annually (Pasnan & Blankon, 2011).
Pricing:
Almarai prices its product by first taking the account of the cost of distribution and
production and then the final price of the product is decided, the pricing of different products of
the same product range are priced differently.
Place:

Almarai 2
Almarai first transports the milk from the dairy to it is the central processing and then the
finished goods from the production place are sent to the different sales locations. Almarai
reaches 42000 shops daily. The transport system of the company is designed so that the products
are not spoiled (Eric, 2012).
Promotion:
Almarai has very good promotion methods, which helps it to reach the customers
effectively; it reaches its customer through
 Newspaper campaigns: they advertise in various popular papers
 Radio campaigns: this focuses on the promotional and discount factors
 Discounts: discounts are given for promotional basis, which not only increases the profit
but also goodwill among customers
 TV Commercial: this is one of the most common way of promoting products, Almarai
have regular and attractive TV ads on different channels.
 Billboards and holdings: Almarai uses this way of promotion also , it helps the company
to make people aware of the offerings and discounts, also it has this in different
locations where are more people (Baker, 2014).
Answer 3: Porter’s five-force analysis of Almarai
 Threat of new entrants
The new entrants in the dairy industry brings new way of doing things and
innovations, and this thing put a lot of pressure on Almarai for lowering the cost and
pricing strategy for providing new proposition to the customers.
 Bargaining power of suppliers
All the companies in the dairy industry buy their raw materials from various
suppliers. Suppliers in these cases are at a dominant position and this decreases the
margin for Almarai in the market. Most of the powerful suppliers make use of their
negotiating power and try to extract higher prices from the firms in the dairy industry.

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The impact of this is that it reduces the profitability of the company (Milisavljevic,
2013).
 Bargaining power of buyers
Buyers are always very demanding. They always focus on the best offering at a
minimum price, this put pressure on Almarai profitability in the end. Hence if the
powerful customer base is smaller it leads to higher bargaining power, this also increase
the ability to seek more discounts and offers.
 Threat of substitutes of products and services
When a new product launches in the market which also fulfill the customers’
needs in a better way than the profitability of the company suffers. Sometimes the threat
of substitute is high if the company offers unique offerings. In the case of Almarai,
NADEC is one of the major competitors.
 Rivalry among the existing players
If there is high rivalry among the existing players, this thing drives down the
prices, which decreases the profitability of the industry. Almarai works in a very
competitive dairy industry, and this affects the overall profitability of the organization
(Mathews & Levy, 2017).
Answer 4: Almarai product portfolio and BCG matrix:
BCG matrix Study Company covers four categories, which are Dogs, stars, cows and
question mark.
Dogs:
In this segment, those products are included, which have a very low market share and low
growth. These products usually have a very limited chance of giving profit to the organization,
the limited chances of growth means that the management needs to be very careful with their
investment decisions, such products are cash traps and do not help the company gain any profit.

Almarai 4
Cows:
in this segment those products are include which grow slowly in the market but it has
high share in the market, when a product has a very high market share and is being sold but
cannot be seen giving growth to the business, then these product can be considered as a cash
cow. These products are not expected to experience many gains in future but are giving high
profits in the current market (Samson, 2012).
Star:
In this segment, those products are those products, which have a very high growth and a
very high market share. These are those products, which have a very high market share, and
these products can bring high return to the company. These products are also supportive in the
development of the company (Wilding, 2011).
Question mark:
In this segment, these products are those, which give a very high growth in the markets
but have a very low market share. These are those products, which creates problem, these are
problem child in an organization, because these products hold a lot of uncertainty. Either these
products can become a revenue generator for the company or it can become a source of loss for
the company. The industry has high prospective to grow therefore giving the room to the
products to grow as well, if the issues are managed effectively.
Question Mark: Following products fall in this
category-
Fresh Cream, Yogurt, Layered fruit Yoghurt,
Labneh, Sterilized Cream, Stirred Fruit
Yoghurt,
Stars: in this category All the juices such as
Mixed Fruit, Orange with Pulp, Strawberry,
Alphorns Mango, lemon with Mint, Orange,
Orange and Carrot, Mango, Apple, Mango
Mixed Fruit, Mixed berry, Fruit Cocktail,
Guava with Pulp lemon with Mint and Almarai
ghee.
Dogs: Following products fall in this category-
Cream Jar Mix, Sliced Chees, Cheddar Jar
Cheese, Block Cheddar, Halloumi Cheese,
Square Cheese Portions,
Cash Cow: in this category following things
are considered - Tinned Cheese, Butter, Ghee,
Mozzarella Cheese, Desserts, fresh milk,
Triangle Cheese, UHT Flavored Milk, Zady

Almarai 5
Jelly Custard, Zady Drinking Yoghurt, Zady
Flavored Yoghurt, flavored yogurt
References
Baker, M. (2014). Marketing strategy and management. London: Palgrave
Eric, S. (2012) Marketing strategy. Journal of Historical Research in Marketing, 4(1).
Helms, M., & Nixon, J.(2010). Exploring SWOT analysis – where are we now?. Journal of
Strategy and Management, 3(3).
Mathews, S., & Levy, M. (2017). Marketing. Sydney: McGraw-Hill Education
Milisavljevic, M. (2013). Marketing. Value oriented strategic marketing, 44(4)
Pasnan, A., & Blankon, K. (2011). Marketing Channel and Strategy. Journal of Marketing, 45(3)
Samson, D. (2012). Management. South Melbourne: Cengage Learning
Wilding, J. (2011). Management. Current Medical Literature, 28(2)