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Country Market Analysis

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Chris Mahoney

on 10 December 2012

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Transcript of Country Market Analysis

Country Market Analysis of China & Marketing Entry Plan for ZICO CHINA at a Glance UNITED STATES OF AMERICA ZICO Founded in 2004 by Mark Rampolla
Based in Hermosa, California
100% Pure Premium Coconut Water
Target Market in United States
The Young, Athletic, and Health-conscious
Second in Market
Recently expanded
Partnership with Coca-Cola Location: East Asia
Deeply rooted history
The Peoples Republic
Population: 1.344 billion
A High Context Culture
2nd Largest Economy
Difficult market to penetrate Beijing Shanghai Geographical Setting 3rd Largest Country
Capital: Beijing
Temperate, Warm, or Tropical
Mountainous land and Rough terrain
E,NE,SE-Urban Cultural Analysis Geographical Setting
Social Institutions
Living Conditions
Language Social Institution Education: Increasingly more important
Political System: Communist State
Legal System: Commercial
Social Organizations: Han Chinese, Farmer, Urban Workers
Business customs and practices: P-time, High context, Relationships, Group, Face-to-face Living Conditions Diet and nutrition: Improving
Housing: Overpopulated, small
Clothing: Traditional: Silk Robes, Modern: Bright Colors
Recreational activity: Increase in Exercising & Sports Language Official Language: Chinese
Dialects: Seven different spoken
Spoken Versus Written: Complex due to many dialects Cultural Analysis Economic Analysis Population Mix
Economic Statistics
Media Population Mix Total: 1.344 Billion
Growth Rate:.48%
Age Distribution:
65+: 9.1%
Sex Ratio Male to Female: 1.06:1.00
Urbanization: 47%
Economic Statistics GDP: $7.3 Trillion USD, 9.2% growth rate
Personal Income Per Capita: $3029 USD
Distribution of Wealth
Agriculture: 10%
Services: 43.4%
Labor Force
Agriculture: 36.7%
Industry: 28.7%
Services: 34.6%
Working Conditions based on relationships and trust: guanxi
Principal Industries: mining, textiles and apparel, consumer products, food processing
Import: 1.66 Trillion
Japan 11.2%, South Korea 9.3%, U.S. 6.8%
U.S. Dollar to Yuan: 1:6.23
Trade Restriction: Were Easing until recently, "WTO" is currently mediating

Channels of Distribution Number of Retailers:4,817,000
Types: Hypermarkets, Supermarkets, Specialty Shops, Traditional Shops, & Online Retailers
To Own Factory/Store
Highest Degree of Control
33% of Market

41% of Market/ 10% of Market
7% of Market
Joint Ventures/Equity Joint Ventures
Media TV Households: 396 Million
TV Penetration: 98.81%
National TV Station: CCTV
Magazines: 9,468
Newspaper: 1938
Internet Subscribers: 256 Million
Economic Analysis Market Audit and Competitive Market Analysis The Product
The Market
The Product Product Innovation for Intended Market
Relative Advantages: "Premium", rapid hydration, all natural, multiple flavors
Compatibility: Easy hold shape, resealable
Complexity: Not complex, easy to open and consume
Trialability: No social or economic risks when trying
Observability: Easy, just based on consumption acceptance or rejection
Major Problems
Beverage market is highly saturated in China
The Market Market at a Glance Main Regions
Tier 1 Cities: Most Developed; Beijing, Shanghai
Tier 2 Cities: Fastest Growing; Changchun, Shantou
40% on foot, 20%on bikes
Consumer Trends: Starting to buy more luxury and premium items
Distribution of Products:
Hypermarkets,Super Markets, Specialty Shops, Online Retailers
The Competition Coconut Palm Group Company Limited
Coconut Palm Brand Natural Coconut Juice
Flavor: 100% Natural and Young Coconut Juice
Non-carbonated, non-alcoholic
Shelf Life: 2 Years
Packing: 1.25L× 6/Carton
Feature: Qualified, clean, luscious, fragrant and greatest taste, suit for health.
Competitors Pricing Competitors Prices
Coconut Palm Brand Natural Coconut Juice: 1.50 USD or 9.37 Yuan
Competitors Promotion and Advertising
Print Advertising only
Competitors Distribution Channel
Produced locally in Hainan Province by peasant and processed in Haikou
Distributed to retailers by trucks

Beverage Market China's Beverage Market: 824.6594 Billion Yuan in 2010
24.46% increase from previous year
Coconut Beverage Market: Very small
Coconut Palm Group Company Limited Sales Forecast
Annual production of 1 million tons and annual outcome value of RMB 7 billion
ZICO Sales Forecast
Five fold and growing the most rapidly among US competitors
Competitive Market Marketing Plan for Entry Objective
Promotion Mix
Distribution Market Objective for ZICO in China Target: Young, active, health-conscious, and affluent
Penetrate: Tier 1 & 2 Cities in Eastern Parts of China SWOT Analysis STRENGTHS “Naturally Powered”-All natural
Multiple flavors
Appealing Brand Image
Strong niche market in sports
Partnered with Coca-Cola WEAKNESSES Unfamiliar taste
Company size is small
Company is not well known outside of United States
Coconut market is relatively new as well as small
Coca-Cola’s current distribution plan in China
China consumers trends
Chinese lifestyle trends
Hypermarkets increasing
THREATS Saturated Market
Coconut Palm Group well established
Change in consumer trends
Cultural Diversity
Promotional Mix Advertising
Objective: Gain brand awareness by informing and persuading our target market about our products benefits
Media Mix: Print Advertising, Direct
Message: “Naturally Powered”
Sales Promotion
Objective: Push strategy to gain awareness, aggressive sampling events in urban cities, lifestyle events, sports events, natural food markets
Distribution ZICO will use Coca-Cola for bottling and distribution
The distribution from plants will use third party trucks to deliver to retailers
Distribute majority to Hypermarkets
Ex: Carrefour or Wal-Mart
Retail markups
Will be sold at 15.58 Yuan which in the U.S. is equal to $2.50
PEOPLES REPUBLIC OF CHINA Recommendation Make the Entry
2nd Largest Economy
Coca-Cola Backing
Aim for Tier 1 & 2
Endorse Stars
Yao Ming
Entry Could Make ZICO #1 Globally YAO NATURALLY POWERED BY
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