Marketing Project

Usman Ullah Butt © MBPM-F16-009

Ramsha Omer MBPM-S17-005

Sair Ahmad MBPM-F16-016

Riffat Parveen MBPM-S17-001

M. Usman Sardar MBPM-F16-007 the

Under the Supervision

Prof. Ma’am Tabinda Usman

 1. Executive summary
Hico Ice Cream, a failed product of the Pakistan Fruit Juice Company, has been used for business analysis
and marketing strategy development for this marketing research report. Hico was established in 1958,
under the ownership of Pakistan Fruit Juice Company, in Lahore. The company pioneered the concept of
pure dairy ice creams, and established a benchmark for other ice cream brands, that ventured into the
production of frozen desserts rather than ice creams.

The concept of this business report was to identify issues within Hico Ice cream that contributed
towards its failure and provide efficient and effective solutions to these issues. The report analyzed the
strengths, weaknesses, opportunities, and threats for the company; and identified that its pure dairy ice
cream status provides the company with a leverage over its competitors. We also identified that Hico is
the only producer of diet ice creams in terms of branded ice cream producers. The problem, as
identified through research, was that the company has a poor marketing strategy, with little to no
placement and promotional strategy. The solution to these marketing issues, as recommended by us,
was the launch of an Ice Cream parlor dedicated towards children, inclusive of a performance studio.

The marketing mix for this project launch focused on a 3 month, short-term, campaign. The activities to
be carried out during this period was: extensive advertising for awareness; engaging in direct contact
with customers through BTL; product development by developing new flavors and new sized ice creams
(previously lacking in the product portfolio); and establishing customer loyalty by using the company’s
long-haul operations in the Pakistani market.

The marketing mix focused on product, price, place, and promotional strategy for Hico for 3-time
periods: short term, medium term, and long term. Short term plans were quick and applicable and
focused more on promotions and advertising along with extension of flavor and sizing, while giving little
attention to market development or diversification. Market development is planned to be carried out in
the medium term by penetrating ice cream markets in other cities of the country. The long-haul plan for
Hico was centered on improving placement by opening similar ice cream parlors in other cities. The
main emphasis of the long haul plan, however, was on diversification. We plan to encourage the
company into the production of other dairy products, like: milk, butter, and yoghurt, in order to tap
markets for other dairy products, meanwhile ensuring that the raw materials required will be more or
less the same, enabling Hico to improve its operations and product portfolio.
Contents
1. Executive summary ............................................................................................................................... 3
2. Introduction .......................................................................................................................................... 6
3. SITUATIONAL ANALYSIS ........................................................................................................................ 8
4. PESTEL ANALYSIS ................................................................................................................................... 9
4.1 Political Factors ............................................................................................................................. 9
4.2 Economical Factors ....................................................................................................................... 9
4.3 Social and Cultural Factors ............................................................................................................ 9
4.4 Technological Factors.................................................................................................................... 9
4.5 Environmental Factors .................................................................................................................. 9
4.6 Legal and Regulatory Factors ........................................................................................................ 9
4.7 Porter’s Five Forces Model ......................................................................................................... 10
4.8 Threat of New ............................................................................................................................. 10
4.9 Entry ............................................................................................................................................ 10
4.10 Threat of Substitutes................................................................................................................... 10
4.11 Bargaining Power of Suppliers .................................................................................................... 10
4.12 Bargaining Power of Consumer .................................................................................................. 10
4.13 Rivalry.......................................................................................................................................... 10
4.14 Customer Profiling ...................................................................................................................... 11
4.15 Demographical segmentation ..................................................................................................... 11
4.16 Geographical Segmentation........................................................................................................ 11
4.17 Phycological Segmentation ......................................................................................................... 11
4.18 Behavioral Segmentation ............................................................................................................ 11
4.19 Competitor Analysis .................................................................................................................... 12
4.20 Strength....................................................................................................................................... 12
4.21 Weakness .................................................................................................................................... 12
4.22 Opportunity................................................................................................................................. 13
4.23 Threats ........................................................................................................................................ 13
4.24 Point of Similarities and Difference ............................................................................................ 14
4.25 Strength....................................................................................................................................... 14
4.26 Weakness .................................................................................................................................... 14
4.27 Opportunity................................................................................................................................. 14
4.28 Threats ........................................................................................................................................ 14
 4.29 Unique Selling Points .................................................................................................................. 15
5. Marketing Strategy ............................................................................................................................. 16
5.1 ANSOFF MATRIX.......................................................................................................................... 16
6. Boston Consulting Group (BCG) .......................................................................................................... 17
7. Marketing mix ..................................................................................................................................... 18
8. Budgeting Plan .................................................................................................................................... 19
9. Expense Sheet ..................................................................................................................................... 21
10. Marketing Department Hierarchy................................................................................................... 22
11. Implementation Plan ...................................................................................................................... 23
 2. Introduction

Hico was the first ice cream company in Pakistan, was established in 1958,

under the ownership of Pakistan fruit juice Company private limited. Hico

Ice Cream has had the honor of introducing the concept of pure dairy ice

cream to the market, when frozen desserts have been marketed at a wider base. They company’s

production capacity is approximately near 4.5 million liters of dairy ice cream per annum (Haroon,

& Saad, 2006). The company, in comparison to other market operators, is a medium sized

organization with very limited resources, which have proven to hinder Hico expansion and

performance over the years. The company believes in internal growth which is why it has refused

to grow to magnanimous proportions (Haroon, & Saad, 2006).

With different forms of market innovations, the company was the pioneer of many new market

strategies in the country. Hico was the first brand to introduce the push cart ice cream format in

Pakistan, with the launch of this sales technique in Lahore in 1990 (Haroon, & Saad, 2006). In

order to better cater to the market and their customers, the company went on to launch home

delivery for their products but the plan succumbed due to feasibility and costs of the strategy. The

company digressed from parlor and designated outlet sales to selling through bakeries and grocery

marts, although now the company makes most of its sales through direct retailing from its factories.

In 1997, they established proper marketing and sales department to improve its business (Haroon,

& Saad, 2006). They also expanded their business with the entry in to markets of Karachi,

Peshawar and Rawalpindi.

Expansion for Hico took place following 1997, when the echelon management finally decided to

penetrate other domestic markets, including: Karachi, Rawalpindi, Faisalabad and Peshawar. Even

though the company lacks product innovation and its product portfolio is very restricted, the

company has managed to cater to a diversified target segment by launching diet ice cream, in order

to cater to health conscious and diabetic patients that are otherwise left out by other ice cream

producers. This helps to highlight how Hico is suitable for all demographic divisions in the

Pakistani market.
3. SITUATIONAL ANALYSIS
This part of the business report deals with analyzing the internal standing of Hico Ice Cream and where
the company lags. A series of analytical tools, like:

SWOT Analysis

PESTEL Analysis

POS+POD determination

Porters 5 Forces Model

USP Determination

Have been utilized in order to see how the company is performing in its internal and external
environment.
4. PESTEL ANALYSIS
4.1 Political Factors
 Volatile and unstable political situation in Pakistan.
 The vulnerable situation is not ideal for business operations.
 Political rallies, strikes, marches, terrorism, etc, can hinder
business operations for Hico.
 Political instability and incompetence are resulting in slow
growth ("Political instability in Pakistan", 2016).

4.2 Economical
 High inflation levels: rose by 50% since May 2016 (3.17
inflation rate), and has reached a rate of 4.78 by June 2017
Factors ("Pakistan Inflation Rate", 2017).
 Increasing inflation means weaker purchasing power of
consumers.
 Also means higher production costs for Hico since inputs
become expensive.

4.3 Social and  Pakistan has a wide age bracket of growing populace.
Cultural Factors  Higher number of children and young adults.
 Glaring opportunity for boosting sales for Hico.
 Weather is also favorable.
 Remains hot and humid for most of the year round.
4.4 Technological
 R&D seems next to absent.
Factors  Poor levels of automation.
 Outdated machinery and plant.
 No replacement of upgradation of the technology in the
production plants of the company.

4.5 Environmental
 Air and environment pollution gaining serious attention in the
Pakistani society.
Factors
 Ice cream production units release CFCs in great quantities.

4.6 Legal and

 The ice cream industry in Pakistan has numerous set protocols
to follow which include certain composition regulations like:
Regulatory every ice cream unit must have more than or 10% of milk fat
Factors and not less than 10.1% of milk solids (THE PUNJAB PURE
FOOD RULES, 2011, 2011).
 The company or the parent company, both, are not ISO certified.
4.7 Porter’s Five Forces Model
Threats Low Medium High

4.8 Threat of New

4.9 Entry 

4.10 Threat of
Substitutes 

4.11 Bargaining Power

of Suppliers 

4.12 Bargaining Power

of Consumer 

4.13 Rivalry

4.14 Customer Profiling

4.15 Demographical segmentation

Gender Female, Male.
Age 5-9 years, 10-19 years, 20-29 years, 30-39 years, 40 above.
Class Lower middle class, and upper middle class.

4.16 Geographical Segmentation

Country Pakistan.
Region Punjab
Intensive Urban Area
Climate Hot and dry climate.
Areas Lahore, Rawalpindi, Karachi, Faisalabad, Peshawar

4.17 Phycological Segmentation

Attitude Positive, neutral.
Life Style Achievers, and strugglers.
Perception Everyone love to have ice cream
Motivation Higher Involvement

4.18 Behavioral Segmentation

Usage Rate Frequent, limited.
Loyalty Status Loyal, split.
4.19 Competitor Analysis
SWOT HICO ICE CREAM
 One of the oldest national
4.20 Strength companies
 Hico Ice cream was established in
1958, in Lahore.
 Produces dairy ice cream.
 First company to lunch premium
flavor like: praline, Oreo cookies
etc.
 Offer low sugar level, diet ice
creams Vanilla light.
 Customer loyalty due to long haul
presence in the market.
 Poor marketing, distribution,
4.21 Weakness limited resources.
 Poor positioning strategy:
Majorly operates in Lahore.
 Limited availability
 Stock issues in peak sales periods
(summers): short supply
 Limited flavor portfolio, with very
basic and generic flavors, in
comparison to rivals.
 Substandard product packaging
and presentation.
 Lack of innovation.
 less market share as compare to
competitors.
YUMMY ICE CREAM
 No preserving chemicals that
affect the health.
 It’s a frozen dessert.
 It is a time saving product.
 Skills and trustworthy workers
are working in the company.
 Consumer loyalty.
 Poor marketing, distribution
and less recourses as compared
to competitors.
 It has no strong brand image,
 Lack of distribution channels.
 less market share as compare to
competitors.
 They have less technical
resources.
 Substandard product packaging
and presentation.
 Limited availability.
 Lack of innovation.
  Possible market opportunities  The company can use new
4.22 Opportunity in other cities. technology.
 Improving marketing,  They can change its target
distribution, and availability. segment.
 Low pricing strategy allows  Prepare the new ice cream flavors
them to target low budget and outlet.
areas.
 They can change product image
 Improving marketing,
by changing its styles.
distribution, and availability.
 Pakistan is predominantly warm  Improving marketing,
weather country, improving distribution, and availability.
production and stock can  Lunch stronger marketing
bolster sales. campaign.
 Changing market dynamics: ice
cream has a market in the
winters too, which Hico can
exploit to its benefit.
 Introduce new ice cream flavors
and outlet, like: Walls on Main
Boulevard.
 Lunch Stronger marketing
campaign.
 Could expand diet ice cream
range.
 Wider flavor and range by  Other competitors also offering
4.23 Threats competitors. products at similar quality and
 New market entries. Example: price.
Gelatos, Move n Pick, etc.  Big companies and MNEs with
 Large market share of high end R&D rivaling with
competitors. yummy.
 Economic and political
 Most people are not really brand
instability within the country.
conscious, so loyalty might be an
 Big companies and MNEs with
issue
high end R&D rivaling with Hico.
 Poor internal performance.  Competitors have more resources
than yummy ice cream.
 Large market share of
competitors.
 Economic and political instability
within the country.
4.24 Point of Similarities and Difference

SWOT Point of Similarities Point of Difference

 Customer loyalty due to long  One of the oldest national
4.25 Strength haul presence in the market. companies
 Hico Ice cream was established in
1958, in Lahore.
 Produces dairy ice cream.
 First company to lunch premium
flavor like: praline, Oreo cookies
etc.
 Offer low sugar level, diet ice
creams Vanilla light.

 Poor marketing, distribution,  Poor positioning strategy: Majorly

4.26 Weakness limited resources. operates in Lahore.
 Limited availability.  Stock issues in peak sales periods
 Lack of innovation. (summers): short supply
 Substandard product  Limited flavor portfolio, with very
packaging and presentation, basic and generic flavors, in
 Less market share as compare comparison to rivals.
to competitors.
 Introduce new ice cream  Possible market opportunities in
4.27 Opportunity flavors and outlet, like: Walls other cities.
on Main Boulevard.  Low pricing strategy allows them to
 Lunch Stronger marketing target low budget areas.
campaign.  Pakistan is predominantly warm
 Improving marketing, weather country, improving
distribution, and availability. production and stock can bolster
sales.
 Changing market dynamics: ice
cream has a market in the winters
too, which Hico can exploit to its
benefit.

 Large market share of  Wider flavor and range by

4.28 Threats competitors. competitors.
 Economic and political  New market entries. Example:
instability within the country. Gelatos, Move n Pick, etc.
 Big companies and MNEs with  Poor internal performance.
high end R&D rivaling with
Hico.
4.29 Unique Selling Points
 One of the oldest national companies
 Hico Ice cream was established in 1958, in Lahore.
 Produces dairy ice cream.
 First company to lunch premium flavor like: praline, Oreo cookies etc.
 Offer low sugar level, diet ice creams Vanilla light.
 Possible market opportunities in other cities.
 Low pricing strategy allows them to target low budget areas.
 Pakistan is predominantly warm weather country, improving production and stock can
bolster sales.
 Changing market dynamics: ice cream has a market in the winters too, which Hico can
exploit to its benefit.
 5. Marketing Strategy
5.1 ANSOFF MATRIX

PRODUCT

EXISTING PRODUCT NEW PRODUCT

MARKET PENETRATION PRODUCT DEVELOPMENT

 Launch of other sized ice creams.  Launch of new flavors.

 Launch of ice cream cones.  Red velvet and After Eight.
 Launch of ice cream cups.  Launch of customized ice cream offered
at the studio.
PRESENT

M
A
R
K
E
MARKET DEVELOPMENT DIVERSIFICATION
T
 Market penetration into other cities of  Tapping other dairy products markets.
Lahore.  Producing yoghurt, butter, and milk.
 Market penetration through selling
products through retailers and
NEW

hypermarkets.
 Market penetration through opening
studios in other cities (long term plan).
6. Boston Consulting Group (BCG)

Market Share
HIGH LOW
Industrial Share

HIGH HICO PARLINE BOX HICO COCONUT BOX

$
LOW

LIGHT VANILA BOX CHOCO BAR, MANGO

CREAM BAR
COOKIES & CREAM BOX STAWBERRY CREAM
BAR
7. Marketing mix
Long Term Strategy Short Term Strategy Launch Campaign
(5 Years) (2 Years) (3 Month)
Product Diversify Product Adding More Flavors  Mini Cones
 Milk  Chocolate Chip Bar  Cones, Bars and
 Yoghurt and Cone Cups
 Butter (Dairy  Strawberry Bar and  Hico Kulfa Bar
Product) Cone  Hico Mango Bar
 Extension of Diet Ice  Hico Multi Bar
Cream 1 KG BOX  Hico Vanilla Cone
 Hico Charry Nice
Cone
 Hico Cup Scoop
 Hico Red Velvet
Cone
 Hico After Eight cup
Price  Milk Rs. 35 250 gm  Mini Cone Rs. 37  Mini Cone Rs.35
(Calculate Through Rs. 70 (500gm) Rs.  Bar Rs. 32  Bar Rs. 30
Inflation Rate last 5 115 (1Kg)  Cone Rs. 53  Full Size Cone Rs. 50
Years)  Yoghurt Rs. (100 Kg)  Cups Rs. 64  Cups Rs.60
 Butter Rs. 50 (45gm)  Diet ice cream
Rs.300 per Kg
Place  All Over Pakistan  Major Cities in  Lahore
Major Cities Punjab
 Karachi  Islamabad
 Peshawar  Faisalabad
 Quetta  Gujranwala
 Multan
Promotion  Digital Marketing  Mobile Application  ATL
 Online Order  Through Television
 Home Delivery Add
 Loyal Customer  Flex
Discount  BTL
 Bunting
8. Budgeting Plan
9. Expense Sheet
10. Marketing Department Hierarchy

CMO
USMAN ULLAH BUTT

MARKETING MARKET RESEARCH PROMOTION

SALE MANAGER
STRATEGIES MANGER MANGER DIRECTOR
(RIFFAT PARVEEN)
(RAMSHA OMER) (M.USMAN SARDAR) (SAIR AHMAD)
11. Implementation Plan
Task Responsibility Timeline Status
Monitoring CMO Three Done
Month
Sales Checker Sales Manager Three Done
Month
Planning Strategic Three Done
Manager Month

R&D Market Research Three Done

Manager Month

Advertising Promotion Three Done

Director Month