CHAPTER 1
BACKGROUND
1.1. Ready To Drink Industry in Indonesia Overview
People in big city are become more practical. The prefer something that
simple, fast and easy to find. They are prefer fast food than self cooking at
home, they better go to shop to buy drink than make their own drink, use their
smartphone to buy something than go to shop, etc. In the other words, their
lifestyle are changing!
This new lifestyle affects directly to beverage industry. Since people
prefer to buy drinks than make their own drinks and spend times at home, Ready
to Drink (RTD) industry start to grow and become more attractive from year to
year.
In Indonesia, beverage industry especially soft drinks industry is
growing approximately 7% year to year in volume. (Euromonitor, 2014).
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2
Soft Drinks Industry by Volume 30000
25000
20000
15000
10000
5000
0 2008 2009 2010 2011 2012 2013
Figure 1. Soft Drinks Industry by Volume. Source: compilation from Euromonitor, 2014 Having everything instantly drive people in big city to high mobility.
They spend a lot of time on the road than their house. High mobility made themselves easy to get tired and dehydrated. As they realize that their high mobility affect their health, they become conscious to their own health. In big city especially in Jakarta, sport activity like running, futsal, gym and also yoga are really popular to balance their life.
RTD industry attractiveness combine with high mobility and increase in health awareness are good combination for isotonic drinks to be born.
Isotonic drink is one sub category in RTD industry that promotes health and well hydrated body to support people activity. Other category of RTD industry including Bottled water, juice, tea, coffee, carbonates, etc. Picture 2 show shares for each drink category in the market for year 2013 based on
Euromonitor, 2014 research result. The percentage of isotonic drink maybe not
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as big as other category but it is actually growing. Next section will describe
more specific about isotonic drinks market.
Beverage Industry Shares Based On Volume
0.07% 2.79% 0.51% 0.76% 7.36% 0.52% 3.90%
84.09%
1. Bottled Water 2. Carbonates 3. Concentrates 4. Juice 5. RTD Coffee 6. RTD Tea 7. Sport and Energy Drinks 8. Asian Speciality Drinks
Figure 2. Beverage Industry Share based on category. Source: Euromonitor, 2014
1.2. Isotonic Drinks
In such a modern era today, people are more conscious about their own
health as they have high mobility. Healthy lifestyle has become trend. Sport
activity is not only for those who want to keep healthy, but also for those who
want to keep their stamina for the whole day activity, stay young and maintain
body shape. Because of this healthy lifestyle, healthy drinks demand like
isotonic drinks increase. People incline to decrease their consumption for
carbonates.
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Isotonic drink is growing so fast in Indonesia and also in the world.
Isotonic drinks contain vitamins to replace the body fluid that has been waste due the activities and can restore the freshness human body.
There is some category in soft drink industry where bottled water hold about 84% of total sales volume from 2008 to 2013, followed by Ready To
Drink (RTD) Tea around 7%. Sport and Energy drinks hold around 2.8% increase 0.7% from 2008 while other categories not increase significantly.
Soft Drinks Industry Categories by Volume 100% 2.09% 2.79% 95% 7.20% 7.36% 90% 3.94% 85% 3.90%
80% 85.05% 84.09% 75% 2008 2013
Bottled Water Carbonates Concentrates Juice RTD Coffee RTD Tea Sport and Energy Drinks Asian Speciality Drinks
Figure 3. Soft Drinks Industry Categories by Volume. Source: compilation from Euromonitor, 2014
There are some big players in isotonic drinks industry:
1. Pocari Sweat (PT Amerta Indah Otsuka)
2. Mizone (PT Tirta Investama)
3. Aquarius (PT Coca Cola Indonesia)
4. Hydro Coco (Kalbe)
5. Coolant (PT Sari Enesis)
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Companies are competing each other to gain bigger share in the market.
The pioneer of isotonic drink in Indonesia is Pocari Sweat brand. To be the first isotonic brand is not easy for them. It was hard to educate Indonesian about isotonic drink. As the time goes by Mizone came to the market followed by other brand like Hydrococo, Coolant and Aquarius. Each brand was trying their best to compete in the market by having unique tagline, targeted different segment and also differentiate its packaging. They were also try to increase awareness of their brand by having social presence online. Differences between competitors are shown in table 1 on the next page.
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Table 1. Competitor Analysis of Marketing. Source: compilation from many sources
2012
Aquarius
AquariusTopic -
aquarius.coca-cola.co.id
likes since Feblikes 2013
AquariusIndonesia, 156335
tweetssince January 2013
followers, 103 following, 1937 1937 following, 103 followers,
@AQUARIUSid, 72700 72700 @AQUARIUSid,
PetBottle
TV
IDR 4,990 IDR
Serius balikin cairan tubuhmucairan Seriusbalikin
Coca Cola Coca
2010
Hydrococo
Coco)
RealCoconutWater(Hydro
myhydrococo.com
Oct 2012 Oct
HydroCoco, 63474 likes since likes HydroCoco,63474
tweets,May join 2010
followers, 128 following, 21049 21049 following, 128 followers,
@My_HydroCoco, 21479 @My_HydroCoco,21479
Tetrapak
Get Up Get Active (Off air) Active (Off Get Up Get
Newspaper
Radio
TV
IDR 4,800 IDR
All 20-34 ABC1 20-34 All
Love Coco Live Active CocoLoveLive
Kalbe
2011
Coolant
(minumanantigerah)
Coolant ID CoolantID
Coolant.co.id
April 2011 April
Coolantid, 118244 likes since likes 118244 Coolantid,
join March 2011 join
13084 following, 9408 tweets, 9408 following, 13084
@CoolantID, 20623 followers, followers, 20623 @CoolantID,
coolantid
PetBottle
Indosiar,
Sponsorship Sepeda Ria
Newspaper
TV,
IDR 4,600 IDR
MF 20-44 ABC 20-44 MF
Minuman IonMinuman dan Penyejuk
PT Sari Enesis Sari PT
2005
Mizone
Mizoneid (Mizone 100%) (Mizone Mizoneid
mizone.co.id
April 2009 April
Mizone, 1450752 likes since likes 1450752 Mizone,
join January join 2010
60 following, 12480 tweets, 12480 following, 60
@mizoneid, 211975 followers, followers, 211975 @mizoneid,
PetBottle
air)
Flashmob Car Free Day (Off Day(Off Free FlashmobCar
Newspaper
Radio
TV
IDR 4,200 IDR
MF 20 - 34 ABC1 34 - 20 MF
Bantusemangatlagi! Ok
Investama
PT Aqua Golden, PT Tirta AquaTirta PT PT Golden,
1989
Pocari Sweat Pocari
Pocarigoion (Pocari ID) Pocarigoion(Pocari
pocarisweat.co.id
2010/Apr 2012 2010/Apr
pocariID, 588464 likes since likes 588464 pocariID,
join March join 2010
778 following, 23475 tweets, 23475 following, 778
@pocariID, 104440 followers, followers, 104440 @pocariID,
Can, Pet Bottle, Sachet PetBottle, Can,
Nikerun
Newspaper
Radio
TV
IDR 5,590 IDR
Dewasa
SES segmentC+ A,B, SES
hilang, mengandunghilang, Ion
Penggantitubuhcairan yang
PT Amerta Indah Amerta PT Otsuka
Variable
YoutubeChannel
Website
FB Account FB
Packaging
Marketingtools
Price
TargetSegment
Tagline Year Sold in Indonesia in Sold Year Producedby
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1.3. Company Background
Enesis Group founded in 1988, is the first product released and leading
in market Indonesia mosquito repellent lotion named Sari Puspa and has
changing name with Soffell, Now, it is currently becoming a market leader too
of mosquito repellent lotion in Asia and middle East.
Generally, Enesis Group is divided into three companies:
1. PT Herlina Indah made non food products such as Soffel, Kispray,
ForceMagic, and Antis Antiseptic.
2. PT Sari Enesis made food product categories such as Adem Sari, Garglin,
dan Vegeta.
3. Marketama Indah, handling distribution, especially in Jakarta, Depok,
Bogor, Tangerang, and Bekasi (Jabodetabek).
The successful of Soffell makes Enesis Group want to expand the
business into a functional drink category in 1996. They launching a new
category in market herbal supplementary power drink, Adem Sari with Ching
Ku varian or is in overseas known as Sensa Cools. Adem Sari or Sensa Cools
enhances the body's digestion system, relieves constipation, and heals sore
throat and canker sores. Another accomplishment of Enesis Group launch in
2000, is Vegeta, contains a natural fiber powder drink.
Enesis Group is committed to always develop innovative products.
Some of its products such as Soffell, Adem Sari or Sensa Cools, Vegeta,
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Kispray, Antis, and Force Magic are the market leaders in their categories and has become a household brand with distinctive differentiation products.
Throughout the years, Enesis Group products won many prestigious awards such as Top Brand and ICSA (Indonesia Customer Satisfaction Award).
It makes Enesis Group perceived as trusted brands by the highest customer satisfaction.
To achieve international quality standards; Enesis Group owns two manufacturing plants is in Pulo Gadung Industrial Estate and Cikarang
Industrial Estate with GMP (Good Manufacturing Practice) and ISO 9001:2008 standards. It is supported with more than 3,000 employees for two manufacturing. Determined to create new products and expanding market both locally and globally, the latest expansion projects is market penetration in
China, Vietnam, Thailand and USA.
Nowadays, Enesis Group has expanded they own product line into various categories and establish as one of the prominent Fast Moving Consumer
Goods groups in Indonesia (FMCG). The Fast Moving Consumer Goods
(FMCG) product is Proman energy drink and Coolant isotonic drink.
1.3.1. VISION
Enesis Group is strongly committed to become a world leader in
the area of healthy drink and selected FMCG (Fast Moving Consumer
Goods) product category. To achieve this vision, Enesis Group always
tries to be:
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1. Create innovative products which are able to provide a solution
according to the consumers’ needs
Understanding the consumers’ needs becomes the main principles of
the Enesis Group. The existence of Enesis Group’s products, such as
Adem Sari which is a solution for healthiness, Soffell with an 8-hour
protection to keep the family from the dengue fever threat, Proman
to stimulate energy and body freshness, Vegeta to fulfill the needs of
daily fiber intake, and other innovative products which is a proof of
Enesis Group will always strive to create products according to the
consumers’ needs.
2. Ensure that all products are in good quality
Quality assurance and product quality are our priorities for the
consumers. For twenty five-years is a real proof of the public trust on
Enesis Group’s product qualities, which is able to fulfill the
consumers’ satisfaction. Enesis Group is committed to always ensure
the product quality maintenance starting from its production process
until the product received by the consumers.
1.3.2. MISSION
To achieve the aforementioned vision, Enesis Group is committed to:
1. Oriented towards the fulfillment of the consumers’ needs.
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2. Develop innovative products as a solution for the consumers’ needs
by maintaining the product quality, strengthen the distribution
network and creative communication to the consumers.
3. Develop human resources that are competent, professional, and
having high integrity.
4. Increase the public awareness and responsibility of the environment
and social needs.
5. Market superior products to fulfill the consumers’ satisfaction.
1.4. Product of Enesis Group
Enesis Group want to fulfill the needs of consumers by providing high quality
innovation by develops all products through extensive product and marketing
research. In accordance with Corporate Vision, Enesis Group will keep on
developing products with new innovation food supplement, personal care,
household care, pharmacy, and ready-to-drink products. Product of Enesis
group separate in two division:
Personal and Home Care:
- Antis
- Force Magic
- Force Magic Microns
- Kispray
- Kispray Fabric Conditioner
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- Soffell
Nutraceutical and Functional Drink
- Adem Sari
- Coolant
- Garglin
- Sensa Cools
- Sensa Cools Qing Ku
- Vegeta
- Vegeta Herbal
1.5. Marketing Structure
Figure 4. Marketing Structure Enesis 2014. Source: Enesis Group 2015
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1.5.1. Job Description
GENERAL MANAGER
- Manage advertising opportunities in other theatre program, press
and at venue
- Organize ability of company members for media or public relation
if it’s necessary
- Oversee content, production and distribution of all marketing and
publicity materials with director designer and project manager.
- Manage press development
- Coordinate the invitation of potential future promoters and
supporters company
MARKETING MANAGER
- Achieve optimum sales for every products
- Make sure product inventories needed every month
- Keep in balance pricing structure in the market
- Spread the product distribution for every products
PRODUCT MANAGER
- Achieve all optimum target of sales for every single products
- Keep the positioning and image of product
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PRODUCT EXECITIVE
- Helping Product Manager to achieve optimum target of sales for
every single products
- Helping Product Manager to keep on the positioning and image of
product
ADMINISTRATION OFFICER
- Manage and facilitated all office administrations
- Responsibility all the process and report marketing department.
1.6. Coolant Brand
Coolant establish in 2011 from PT Sari Enesis. PT Sari Enesis seen there
uis an opportunity demand on market for isotonic drink with the body cooling
and extract chrysanthemum flower, which is the differentiation ingredients with
the other products.
On 2011, Coolant have a marketing tag line as “hot body cooling drink”
as their own positioning on market. They still don’t want to attack frontally to
the prior product who has the biggest market share of isotonic drinks. But, as
the time goes by, on April 2012, Coolant change the tag line become “body
cooling drink”. They still don’t want to attack frontally.
2014 is the start of changes for Coolant; they change the tag line become
“ion and body cooling drink”. They put ion as the positioning in the market as
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an isotonic products. They want to convince the customer to take coolant as
isotonic products who has different ingredients with the others.
The biggest market share of Coolant is in Bali and then Jakarta. Sales
in Bali is always over achieve and the positioning at that area is too strong for
the others product to enter the market. Almost every single stores at Bali always
full of branding of Coolant.
1.7. Problem Definition
In order to develop effective strategy for a product, there are some
elements that need to be evaluated by company which is if the product that need
to be sold is new product or existing product and if the product need to be sold
in new market or in existing market. Looking back to isotonic drink industry
competition, it is known that the product is already exist and company has two
option, whether to develop strategies to enable product penetrate more in the
market or to explore new market. To decide which strategy need to be taken,
deep analysis need to be taken and a lot of things need to be evaluated by
company.
There are lot of brand for isotonic drink in Indonesia. Brand that become
a top of mind is Pocari Sweat followed by Mizone. Coolant brand is already in
the market but several researches not assuming Coolant as isotonic drink brand.
The reason behind might be since at the first time launched Coolant did not
state itself as an isotonic drinks or might be caused by their attributes itself or
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their message was not delivered well, etc. Therefore further research need to be taken to find out the root of cause and how Coolant can penetrate more in the market.
Talking about attributes, two attributes that play an important role for products is the benefit of product itself and also the brand perception toward product. How companies communicate the benefit of product is very important to draw an intention for trial the product. On the other side, brand performance also important for product to build its brand equity. Good brand perception is the first step to brand loyalty.
Research will be held for Coolant by asking people to rate Coolant performance about its benefit, if people know the benefit of Coolant product or not, and also to rate Coolant performance about their brand, how people think of Coolant brand after they tried, if the product under deliver or not.
In order to increase a brand performance in the market, there are four things to be considered: awareness level of product, trial stage of product, availability of product in the market and intention to repurchase the product. To gain as much profit as it could, it is important for Coolant to increase their awareness level. By increase in awareness level and combine with effective communication and availability in the market, it will be easier for Coolant to persuade people to try. After trial the product, the decision to repurchase or not is depend on the product attributes itself. So review how good is Coolant’s performance in the market become critical.
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Study will be held by involving 200 respondents to analyze Coolant
performance. Does Coolant need to target different market or focus on existing
market? And the study also held to help Company evaluate its performance by
using Importance Performance Analysis (IPA) framework. What point is
important for consumer but low performed by the company? What point need
to be maintained? Last but not the least, study measured about awareness level
of Coolant. How many people aware of Coolant and what strategy need to be
taken by the company to increase their share?
This consulting project was held to help company increase their market
share by evaluating their current target market, evaluating the performance of
brand from customer perception and also to help company formulate an
effective strategy to increase their brand performance by analyzing its product
attributes.
1.8. Objective
Objective of this project are to help Coolant increase its market share by:
- Evaluating Coolant’s current target market
- Evaluating performance of Coolant from customer perception
- Formulating an effective strategy to increase performance of Coolant
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1.9. Benefits
Authors expect that by this consulting project will bring benefits for a
lot of parties including company, public, and other researcher and also for
authors as described as follow:
- It can be useful for the company to know current position of the products
so effective strategy for the future planned can be developed.
- As partial fulfillment of the requirements for Authors to gain master degree
in business management.
- As an extension for another study to explore more about isotonic drink or
Coolant.
- As a reference for public to learn more about isotonic drink industry or
Coolant.
1.10. Scope of Study
Scope of this project is limited to Jakarta area and focus more into
awareness level from customer perception. The time frame for this project is
from 2003 – 2015 and proposed plan is designed for 2016. Research done is
limited to 200 respondent who ever tried isotonic drink in the last 30 days and
range of age approximately 15 to 35 years old.