RELIANCE BAKING SODA | MARKETING MANAGEMENT (Group A09)

Abhijeet Narang (H18002) | Joseph Kuncheria (H18022) | Neeharika Reddy (H18028)

Priyadarshini Mukherjee (H18037) | Siddharth Mathur (H18052) | Srishti Tomar (H18055)

CASE SUMMARY
Stewart Corporation was founded in 1951 by Stewart Augusta with the discovery of baking soda (NaHCO3 ) which he
called as Miracle component. Anna Regnante was appointed as the Domestic Brand Director (RBS) after having
worked for the weaker brands of Steward household division. RBS, is one of the strongest brands of the household
division of Stewart, which can be used as a substitute for cleaners, air fresheners, laundry detergents etc.

CASE ANALYSIS
Strengths Opportunities
 Market Leader  Price sensitivity towards Baking Soda is less &
 A cash cow in Stewart’s household division consumer perceptions as an essential commodity
 High brand recall in product category  BTL promotion of the product in the retail stores
→ increase sales potential
 Out-of-the-box uses for the product such as Sport
equipment cleaning

Weakness
 Increasing threat of private label → brands
loss of market share (5%) in the last
decade
 Relatively low advertising recall of the brand
 Push marketing → stimulate trade consumer
interest
Threats
 Price rise may move customers towards purchasing
Private labels over RBS
 Fiddling with an established Brand and Loyal
customers
 It is an impulse/ convenience product and hence
can be substituted by other similar products

TRADE PROMOTIONS

Month, Budget Spent Net Incremental ROI in Consumer  Trade promotion during May-June resulted
2006 for RBS Contribution Promotion in $215,729 incremental contribution
January 398,580 63,852 16.02% whereas consumer promotion during same
time yielded incremental contribution of only
April 174,643 22,785 13.05% $ 50,615
June 253,390 50,615 19.98%  Excessive trade promotion has led to
September 253,390 60,820 24.00% compromised margins on the product but
Total 1,080,003 198,072 18.34% has increased the volumes of sales.

CONSUMER PROMOTION

Size Mfg. Selling Suggested Actual Retail Retailer Retailer Sales Overall
Price Retail Price Price Revenue Profit Profit
8 oz 7.2 1 0.9 10.8 3.6 714,000 2,570,400
1 lb. 12.02 1.67 1.503 18.036 6.016 1,226,000 7,375,616
5 lb. 54.28 7.54 6.786 81.432 27.152 648,000 17,594,496

Size Mfg. Selling Price Variable Mfg. Mfg. Profit Sales Manufacture Overall
cost Profit
8 oz 7.2 3.05 4.15 714,000 2,963,100
1 lb. 12.02 5.03 6.99 1,226,000 8,569,740
5 lb. 54.28 22.34 31.94 648,000 20,697,120
 RECOMMENDATIONS

 Improve Trade Incentives - ↑ chances to get more ads run in their favor
 Balancing Promotions – ↑ Trade Promotions ↓ Consumer Promotions
 ↓ cost of TV Advertising, ↑ Print and Online Advertising
 Increase the price of the products (8 oz. & 1 lb.) by 5-10%
 Promotions through print media ( women’s magazines etc.)
 Loyalty bonus and use of coupons