1 / 28

Delissa in Japan

Delissa in Japan. Case study of an internationalization of a Swedish company into the Japanese market. TEAM R.A.M. Rita.Anja.Michel. Rita Chen MA1N0103 Anja Išek MA1N0206 Michel Sung MA1N0245. AGENDA. INTRODUCTION History Abstract CASE DESCRIPTION AND ANALYSIS

crevan
Download Presentation

Delissa in Japan

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Delissa in Japan Case study of an internationalization of a Swedish company into the Japanese market

  2. TEAM R.A.M.Rita.Anja.Michel • Rita Chen MA1N0103 • Anja Išek MA1N0206 • Michel Sung MA1N0245

  3. AGENDA • INTRODUCTION • History • Abstract • CASE DESCRIPTION AND ANALYSIS • Proposal for entry into Japanese market • SWOT analysis based on pre- launch data • Entry strategy • Situation after 3 years and leading up to 2001 • RECOMMENDATION AND ANALYSIS • Mangers point of views • Questions and recommendations • Conclusion

  4. INTRODUCTION Abstract HISTORY OF AGRIA

  5. ABSTRACT • AGRIA, a Swedish milk products cooperative launches its Delissa yogurt in Japan through a joint venture/franchise agreement • At launch in 1991, AGRIA expected to reach between 10% and 15% of the total Japanese yogurt market. • Despite repeated surveys and visits from AGRIA market specialists, Delissa fails to reach 3% of the market in Japan after 10 years of operation. • Disappointed by Delissa'spoor results, the Swedish management begins to wonder whether they should continue in Japan, change franchisee or pull out.

  6. HISTORY OF AGRIA • 1973 : founded by Swedish dairy cooperatives • 1980 : Delissa line was launched • 1981 : USA launch 12,5 % (MS in 2001) • 1984 : Germany launch 14% • 1986 : UK launch 13,8% • 1987 : France launch 9,5% • 1991 : Japanese launch 2%~3% • 2000 : 2,9 billion sales / 4,400 employees

  7. CASE DESCRIPTIONAND ANALYSIS PROPOSAL for entry into Japanese market SWOT ANALYSIS base on pre- launch DATA ENTRY STRATEGY SITUATION after 3 years and LEADING UP TO 2001

  8. PROPOSAL FOR ENTRY INTO THE JAPANESE MARKET OBJECTIVES • Expected growth rate : 10% or 15% total market • 5 % first year • 10% in 3 years • Positioning : high quality range of yogurts • Target areas : TOKYO, OSAKA , NAGOYA in 2 years • Rest of the country within 3 years

  9. SWOT ANALYSIS based on pre-launch data STRENGTHS • Worldwide presence : 13 foreign countries • Worldwide known brand • Partnership : Nikko • 2nd largest association agriculture cooperative • Leader various/food product • Strong supermarket distribution system

  10. SWOT ANALYSIS based on pre-launch data WEAKNESSES • Dependency on local partner : since the franchisee doesn't master very well other languages but their own one (Japanese), Franchiser have to trust and count on locals. • Communication between both companies • Language barrier • Cultural barrier

  11. SWOT ANALYSIS based on pre-launch data OPPORTUNITIES • 30% household budget allocated to food • In 1990, total yogurt market : 600 million cups • Westernization of society : interest to western products • Income is high • Culture and distribution of wealth is homogeneous

  12. SWOT ANALYSIS based on pre-launch data TREATS • Low consumption of dairy products • Substitute : Yakult Honsha / local desserts • Urban lifestyle => shop daily => expect freshness • Distribution system is complex and expensive • Competition • Japanese manufacturers : Snow Brand Milk Products : Largest manufacturer of dairy product : 25% MS Meiji Milk products : Alliance with Bulgaria government : 2nd largest : 19 %MS Morinaga Milk Industry : third largest, JV with Kraft US for cheeses : 10% MS • European brands : DANONE /Yoplait

  13. THE ENTRY STRATEGY • Segmentation • Drinking milk • Eating milk product • Targeting • housewives => purchasers • Core target : families with babies • Young children to high school students • Positioning • Luxuriousmass communication product • « Refreshing nature of Delissa Swedish yogurt; it’s fresh when it’s made at the farm »

  14. THE ENTRY STRATEGY • Advertising • Intensive / short period of time • High budget, almost equal to launch in U.S. • Channels : TV ads / Newspaper/magazine • Pricing • 15% above competitive products • Launch • March 1, 1991 => Tokyo • May 1, 1991 => Osaka and Nagoya • 3 types of products • Plain / Plain with sugar / Flavored

  15. 1994DELISSA AFTER 3 YEARS

  16. DELISSA IN JAPAN SITUATION IN AND LEADING UP TO 2001

  17. DELISSA IN JAPAN SITUATION IN AND LEADING UP TO 2001 MARKETING SITUATION • Media planning • Wrong media planning : target doesn’t match with the broadcasting hours • Advertising rates are more expensive compared with Europe • Positioning : 3 segments • Plain yogurt : marginal profits on this segment. Advertising concentration with existing brand image would differentiate the product and increase sales, reduce costs and increase profit • Flavored : periodic spot • Fruit : periodic spot, new commercial to stress the fashion concept.

  18. DELISSA IN JAPAN SITUATION IN AND LEADING UP TO 2001 Brand awareness • Photo aided Fruit yogourt: Bulgaria > Yoplait > Delissa 71% > Danone Yogourt drink : Delissa – 44 % close to Bulgaria • Brand Image : Delissa is less desirable than Meiji Bulgaria except fashionability

  19. DELISSA IN JAPAN SITUATION IN AND LEADING UP TO 2001 Advertising awareness • 65% could recall something about current ads • 9% could recalled previous ads • 55% didn’t know what the company was trying to say

  20. DELISSA IN JAPAN SITUATION IN AND LEADING UP TO 2001 Consumption follow-up • 77% had consumed plain yogurt within the past month

  21. DELISSA IN JAPAN SITUATION IN AND LEADING UP TO 2001 Consumptionfollow-up • 22 % hadat least triedDelissa- 66 % for Bulgaria • Plain category, mainlyconsumed : • First : Bulgaria, second : Bifidus, third : Delissa

  22. CONCLUSION andRECOMMENDATIONS Mangers point of views Questions and recommendations CONCLUSION

  23. POINTS OF VIEWS

  24. RECOMMENDATIONS • Almost ten years after launching Delissa with Nikko, should Agria cancel its contract and find another distributor ? Considering all the huge previous investments in terms of capital, time, partnership, training, distribution and the existing relationship, Delissashouldn’t cancel it’s contract. Indeed, the cost of changing distributor would be very high. Rebuilding a partnership with a distributor takes time and considerable amount of money. Training the new team is expensive and take time. It will be mortal,weakened the brand and competition will take advantage of the situation In addition, considering the weight of the actual partner, it would be hard to find another partnership with the same size. Finally, the problem of language and cultural barriers would remain the same.

  25. RECOMMENDATIONS • Should Agria renew the arrangement with Nikko and continue to try to gain market share ? Agria should renew the arrangement with Nikko. However internal issues must be handle with negotiations and communication becausethe market potential is there to be taken. The autonomy of the franchisee must be controlled. Strategies must be applied with cooperation. Data conflicts has affect on the effectiveness of action. Terms of arrangement should be redefine and must be clear.

  26. RECOMMENDATIONS • Should Agria admit defeat and withdraw from Japan completely ? Or…was it, in fact, defeat at all ? Agriashouldn’t withdraw from Japan. The opportunities and prospects of the market are promising. The reasons of their “defeat” are organizational and internal issues but also a lack of understanding and adaptation to the Japanese market which led to unfit marketing actions. Indeed, the targeting and positiong were confusing, not clear and not suitable. Many wrong marketing moves were done. However, Agria must learn from experience and corrections can be taken. Finally, the benchmark with the competition shows that Agria is not doing so bad compare to Yoplait and Danone.

  27. CONCLUSION • AGRIA enter Japanese market in 1991. They thought that they would succeed as they did in other foreign countries. They might have underestimate the complexity of the market and didn’t take enough time to prepare their entry. • Despite the fact that AGRIA haven’t reach their objectives, they should keep trying to gain market share in Japan with the NIKKO partnership. • If their advertisements (advertisement awareness) were somehow effective, there were a important gap between what they wanted to communicate and what Japanese really perceived (brand awareness). The message and their positioning was confusing. With their “fashionable” image they would rather target Young adult rather than housewives or children. Finally, flavors must be adapt to local taste. • The internal issues between the both companies created frustration in both sides. In order to solve the problem, they must be courageous and face the issues trough clear negotiations. Effective Information system must be rethink to improve data sharing.

  28. ご清聴ありがとうございました!Tack för er uppmärksamhetThank you for your attention !

More Related