Baker's Delight: Market Analysis and Marketing Mix in Sri Lanka

This report presents a comprehensive marketing plan for Baker's Delight's entry into the Sri Lankan market. It begins with an executive summary that highlights market analysis, the marketing mix (product, pricing, place, promotion, and people), economic evaluation, and implementation strategies. The report delves into the specifics of product strategy, including product life cycle and branding, and details pricing strategies considering factors like income, GDP, and competitor pricing. It discusses the marketing mix elements, product strategy, pricing, place, promotional strategies, and people. Furthermore, it provides insights into market entry strategy, communication plans, and contingency planning. The analysis incorporates various marketing concepts to assess the suitability of the Sri Lankan market and formulate effective strategies for Baker's Delight's success, including a review of the buyer's decision process and the diffusion of innovation theory. The report also provides recommendations for market entry strategies and evaluates the economic factors influencing pricing and market penetration.

GLOBAL
MARKETING

TABLE OF CONTENT
EXECUTIVE SUMMARY ............................................................................................................3
1. Summary of assignment 2...........................................................................................................4
2. MARKETING MIX ...................................................................................................................5
3.2.1 Product strategy ............................................................................................................5
3.2.2 Pricing strategy .............................................................................................................8
3.2.3 Marketing Mix: Place..................................................................................................11
3.2.4 Promotional Mix..........................................................................................................12
3.2.5 People .........................................................................................................................16
4.0 Economic evaluation ..............................................................................................................18
Buyer's Decision Process for New Product..........................................................................18
Diffusion of Innovation Theory............................................................................................21
4.0 Implementation and control ....................................................................................................27
4.1 Communication plan ...............................................................................................................28
4.2 Monitoring of action plan .......................................................................................................31
4.3 Contingency plans ..................................................................................................................36
REFERENCES..............................................................................................................................41

EXECUTIVE SUMMARY
All the three assessments have provided a market evaluation and planning strategy for
implementing a new product launch for the chosen organization. The assignments have
integrated various concepts and approaches of marketing for successfully achieving the business
objectives. Assignment first discussed market analysis and scope through market research
process so that its suitability for the new product can be determined. Also, it has been described
on market statistics, data and information of Sri Lanka market. The market barriers and drivers
are discussed and 4P’s as well. Moreover, competitor analysis is been done in it. Alongside, in
macro environment pestle analysis and in micro porter five force model, value chain and BCG
matrix is explained. At last SWOT analysis is been described to evaluate internal environmental
factors. In the second assignment positioning and targeting strategies are discussed so that
effective strategies can be formulated. Furthermore, it is been explained on alternative marketing
strategies and market selection process. Beside this, recommendations are given related to
market entry strategy in other country. The third assignment has provided an in-depth description
of elements of marketing mix and monitoring and evaluation process. Here, it has been explained
about marketing mix, PLC, pricing strategies, etc. In addition, place, promotional method,
people, etc. of marketing plan is discussed. In this report it is been described about economic
evaluation and implementation and control techniques. At last communication and contingency
plan is been explained of marketing plan. It has been derived from all the three assignments that
targeted market of Sri Lanka has huge success opportunities for Baker's Delight for its new
product.

1. Summary of assignment 2
Assignment two discussed the positioning and target strategies which are used by Baker's
Delight for their products. Various models were employed to determine the suitability of target
market and positioning strategies for the project. It has been analysed from the findings of
assignment 2 that despite political disturbances, due to effective infrastructure and suitable
position Sri Lanka is suitable market for Baker's Delight. In Sri Lanka organisation will address
three targets with different positioning strategy. For target market of age group 15-25 years
social media will be used as positioning strategy. The second target market will be of 25-35
years for which broadcast media is used as positioning approach while for target market of 35
and above age extensive market campaign is used. Outcomes of assignment two have helped in
framing suitable marketing mix approaches for Baker's Delight. This report has described about
marketing plan of Baker’s Delight. In that various elements of plan are been discussed as well. It
includes marketing mix, PLC, pricing strategies, etc. furthermore, it is explained about place,
people and promotional method used by company to enter in Sri Lanka.

2. MARKETING MIX
Marketing mix strategies will help Baker's Delight to assess all controllable and tactical
marketing tools which plays significant role in gaining desired response from the target market.
These elements consist of all aspects which can influence the product demand so that marketing
planning and execution can be accomplished successfully. Effective marketing strategies consist
of marketing mix elements. These elements are designed in alignment with the marketing
objectives of the organisation so that customers can be provided with the optimum value (Abril
and Rodriguez-Cánovas, 2016). The marketing mix strategy is developed once the organisation
has identified competition level and target audience so that it can successfully appeal customers.
The marketing-mix element analysis of Baker's delight is as follows:
3.2.1 Product strategy
Product strategy of Baker's Delight will help organisation to have complete analysis of all
the tangible or intangible product for which customers willingly pay price to the organisation.
The products can be be categories in various categories such as convenience products or
speciality products. The products which are purchased by instant decision making are known as
convenience products. Baker's delight is planning to sell the fresh baked goods in Sri Lanka for
which customers make habitual purchases (Fan, Lau and Zhao, 2015). The customers are forced
to buy products only when it satisfy certain benefit or advantage along with good quality. The
product management process requires various elements such as development of new products
through innovation, planning, product range, labelling, branding, product line and services. The
products are developed in a way such that they can meet the demands of various customers, their
value, taste, trade practices, legal and safety consideration and competitive conditions.
Product life cycle (PLC):
The pricing regimes and success of product is influenced by product life cycle having 4
stages. The first stage is introduction stage in which company launch its product. In this stage
distribution mechanism is enacted and attractive pricing and product strategies are used to assure
the success of product (Stead and Hastings, 2018). The second stage of PLC is growth stage in
which preferences are developed. In this stage product is well known by the customers and faces
competition from other service providers. Thus in growth phase Baker's delight will require to
adjust its prices and product quality so that strong brand and customer engagement can be
maintained.

(Source: Masarakufa, 2019)
In the maturity or third stage sales are constant and very few new customers are
created. In this phase the the product tends to develop customer loyalty so that on the basis of
value proposition customers can be retained for long term. In the last phase called declining
phase the products of Baker's delight may witness customer migration to other attractive
products or choices (Datta, Ailawadi and Van Heerde, 2017). To overcome this situation Baker's
delight can use value added services or partnerships and mergers with other popular brands.
Illustration 1: Product life cycle stages
Our product

(Source: Olsen, 2019 )
In the introduction phase Baker's Delight is using penetration pricing strategy with a
basic and wide product range. The organisation is using selective distribution for minimising risk
factors. For the promotional objectives it is using informative advertisements so that people in
Sri Lanka can know about the brand (Išoraitė, 2016) . However after some time when products
will be in growth stage organisation can increase its prices and new innovations in products can
be accomplished for intensive distribution. In growth phase persuasive advertisement strategy is
used so that customers can be build. With the next stages the promotional strategies of
organisation shifts from persuasive to extensive and aggressive so that customers can be retained
and brand can achieve success.
Brand, labelling and other product attributes:
Baker's delight must emphasis on quality of its products and all necessary food safety and
quality regulations must be followed. It will help organisation to make its brand strong in Sri
Lanka as well. There will be huge range of varieties in the product so that in long term also
company can retain the interest of its customers (Mohammad, 2015). To achieve competitive
advantage from the local organisations Baker's delight must also emphasis on its logo, symbol
and brand name so that its product can be distinguished from others and brand can be used for
Illustration 2: Planning for PLC

dependability and quality proxy. Apart from the legal aspects the labelling of products is also
helpful for promotional objectives. The details such as expiry dates, ingredients, preservation
methods and attractive design enhances product sales. The organisation will also ensure that its
packaging is effective so that product quality is not deteriorated by packaging.
Product mix:
Product mix elements describes variety and range of products organisation plans to sell in
the market. It has four elements called length, consistency, depth and breadth (Sinha and Sheth,
2018). The product depth depth refers to choices of particular products in product line. For
instance Baker's delight will offer products in various sizes so that people have choice to select.
Organisation will also use breadth strategy so that wide range of product lines can be offered.
Like for breads organisation will provide several options such as diet bread, garlic bread, wheat
bread and several other options. Company will not use length strategy in which number of
products are kept sufficient to increase product line (Harrington, Ottenbacher and Fauser, 2017).
For making product strategy successful organisation will also ensure that there is consistency
between product line and the approach through which they reach customers.
Quality and augmented services:
Among the eight quality levels, aesthetic is the most desirable and suitable quality level
for the Baker's delight. It will be chosen as the desired quality level for the organisation. The
reason for choosing this level of quality is that it is linked with perceived quality of product and
describe standards for product appearance, taste, smell (Kotler and et.al., 2018). Hence it is
highly suitable for the food service industry such as Baker's Delight so that it can match the
needs and preference of customers. This quality dimension also depends upon personal
judgement of customers. In order to achieve success goals Baker's delight will also use
product segmentation technique in which a single product will be produce with minor changes or
variations so that different target customers can be served. For instance white bread will be
produced with different ingredients so that variety of people can use. However quality remains a
major factor for affecting success in Sri Lanka. The augmented services such as delivery
mechanism, discounts, loyalty gifts and vouches are also helpful in adding value to product and
to make it more successful (Mukherjee and Shivani, 2016)..

3.2.2 Pricing strategy
Pricing facilitates the transaction through an appropriate exchange medium. This element
of marketing mix generates revenue. Without having accurate pricing strategy Baker's delight
will not be able to make sales even if correct products are launched in the correct market. The
profitability, brand value, growth, survival and prosperity of the brand is greatly dependent upon
price factor (Datta, Ailawadi and Van Heerde, 2017). There organizational decisions related to
pricing are affected by various factors such as government legislation, promotions, demand and
supply, production cost and distribution channels.
Factors Justification
Average
income
Average income in Sri Lanka is extremely low thus keeping premium prices
may not be good choice for the organisation.
GDP The country's GDP and growth rate has been continuously increasing as
country is one of the emerging tourist destination. The high tourism rate
provides a scope for the organisation to maintain its standard prices as in
other parts of the world (Gunarekha and Binoy, 2018).
Currency
exchange rate
Sri Lanka has low currency exchange rate and thus customers will be
required to pay higher for foreign goods so that necessary levels of
profitability can be achieved.
Average
competitors
price
The lower prices than competitors are helpful while entering into new
market.
Cost:
Production
Baker's Delight must try to minimise its operational cost so that it can lower
its prices as per penetration strategy.
Distribution The distribution network must be effective so that it does not add excessive
burden on operations.
Labour Labour law in Sri Lanka have huge constraints which must have some
flexibility and relaxation. The labour cost and availability affect the quality
of services, wages and operational cost.

Material The shortage of bakery raw material and their escalating prices can make it
challenging for organisation to offer penetration pricing. Thus material
availability must be assured so that pricing strategy can be chosen suitably
(Ngarava and Mushunje, 2019).
Marketing Being a tourist spot company will require to promote its services with
variety of approaches so that wide audience can be convinced. It will
involve high expenses and thus pricing will be affected.
Recruitment The employment conditions and wages are strict in destination country. It
can act as challenge to incorporate premium pricing for long term.
Taxes The country's taxation policy has different regulations for foreign
investments thus operational strategies and tax saving policies are driving
force in choosing pricing for the products.
Security The civil wars and terrorist attacks are threats in Sri Lanka so security
measurements can increase operational cost and thus overall pricing may
get affected.
Training Skill mismatch has been one of the issue in Sri Lanka and thus Baker's
delight must provide necessary training to labour force so that operational
expenses can be lower.
Operations The profitability and possibility to offer low prices depends upon
operational efficiency.
The pricing strategy chosen by Baker's Delight depends on various factors such as
competitive actions, input cost, ability of customers to make purchase, trade margin, market
conditions, variable cost, distribution and production cost (Larsson and Jakobsson, 2019). In the
introduction stage of production organisation is using penetration pricing strategy. In this type of
pricing low prices are offered so that people can be attracted towards the brand. Since Sri Lanka
is new market for the Baker's Delight low pricing will be helpful to gain the attention of its
target customers by developing brand awareness and customer loyalty. Though it can be risky as

initially it can lead to loss of income thus Baker's Delight must kept prices carefully so that even
low pricing can give a nominal profitability in the initial phases.
Being a food supplier company also has choice to adopt economy pricing in which
production expenses are minimised as much as possible so that low price products can be sold
and price conscious customers can be attracted. The organisation can also have premium pricing
for some of its selected products in which uniqueness of the products is used for keeping high
prices. However in the start ups this can be risky for Baker's Delight and thus organisation must
chose this strategy in saturation or the maturity stages of product. When company is able to
successfully create its brand then it can also use price skimming for enhancing its sales in which
initially high prices are used and when market competition increases company can lower its
prices (Bahadir, Bharadwaj and Srivastava, 2015). This approach optimises the profit by
focusing on cost addictive customers. In the starting phase penetration pricing is best suitable for
the organisation so that Baker's Delight can establish its brand and customers can be build.
3.2.3 Marketing Mix: Place
Baker's Delight is a franchise- chain of bakery and bakery products of Australia. It is a
wholesale as well as retail suppliers of various products and services, especially raw materials
for final process of production. Other than Australia, it has its retail stores in New Zealand,
Canada and now focusing on expansion of its stores in the Sri Lanka a South-Asian country. The
retailers will be placed in Kandy, Colombo and Galle which are major cities in Sri Lanka and
which have optimum tourist exposure encouraging good sales. The stores and bakery are very
delightful and attractive and seems to be very appealing for the customers. The atmosphere and
the environment around is also so positive and comfortable for all the age groups. The
employees are also very co-operative and response positively to each and every query and
provides various information regarding the products and services offered accordingly(Marketing
Mix – Place (Distribution Strategy), 2019). It is more focused in the Columbia, Sri Lanka, as it is
the best suited place for the bakery business. As it will be beneficial for the company to progress
their, due to higher and constant demand of the bakery products and services in that area. The
strategy for distribution and channels adopted by the Baker's Delight will be as follows: Direct Selling: Selling the products directly to customer will help Baker's Delight to
know more about its targeted customers through active interaction, through which they
can adopt the changes quickly according to their their tastes and preferences. At the

starting stage it is the best strategy one can adopt, as it helps in gaining the feedback
directly from the final consumers in regard to the products and services supplied in the
market of Sri Lanka. Selling Through Re-Seller: This will solve the Baker's Delight problem of handling of
distribution strategy as the third person or at online platform that is the reseller will sell
the bakery products to its customers(Oladepo and Abimbola, 2015). The only drawback
is that, the direct connection with the customers will be diminished. But it will also make
the area of scope wide and also reduce the storage problems of stocks of bakes raw
materials and final products. Intensive Distribution: For covering the wide area of market, and selling of the bakery
products and services the Baker's delight must rely on this strategy of distribution. This
will help in distributing the products nationwide and also at global level, which can be
done through lowering the price at the initial stage which will be more beneficial for
enhancing the productivity as well as profitability of the bakery at global level. Selective Distribution: For selling upscale products by the Baker's Delight, this strategy
can be used. In this the resellers can be asked for selling those products which are high
quality and exclusive and also those which are especially made on order by the
customers(Datta, Ailawadi and Van Heerde, 2017). This process of distribution will also
enhance the connectivity with the targeted customers of the bakery and enhancing the
performance ultimately.
 Exclusive Distribution: Using this strategy for distribution of bakery products will limit
the distribution of base products and final products to one reseller only, which can be
done by any channel. And also, exclusive rights will be given to the reseller to sell all the
manufactured and produced goods and bakery services of Baker's delight.
3.2.4 Promotional Mix
Promotional Mix strategy must be adopted by Baker's Delight for promotion of the
products and services of the business which consists of advertising, personal selling, discounts,
promotions, etc. As the Baker's delight has initially thought of expansion at Sri Lanka it need to
focus more on the promotion activities of its ultimate base and final bakery products. Through
his the store can attract the customers with the products and seek attention on wide variety of
products of bakery(What Is a Marketing Communication Mix?, 2019). This can be done with the