Harvard Case - Channel Change at the BIG PASTURE in Inner Mongolia
"Channel Change at the BIG PASTURE in Inner Mongolia" Harvard business case study is written by Xiaokui Huang, Miao Cui, Liqin Zhang, Ke Wang. It deals with the challenges in the field of Marketing. The case study is 11 page(s) long and it was first published on : Jul 16, 2015
At Fern Fort University, we recommend that BIG PASTURE implement a multi-channel marketing strategy that leverages both online and offline channels to reach their target market of health-conscious consumers in Inner Mongolia. This strategy should prioritize building brand awareness, establishing trust, and fostering customer loyalty through a combination of digital marketing, social media engagement, influencer partnerships, and targeted offline events.
2. Background
BIG PASTURE is a dairy company in Inner Mongolia, China, facing challenges in expanding its market share. The company's existing distribution channels are primarily focused on traditional retail outlets, limiting its reach to a smaller segment of the population. The company's main protagonist is Mr. Wang, the CEO, who is grappling with the need to adapt to changing consumer preferences and increase brand awareness.
3. Analysis of the Case Study
To analyze BIG PASTURE's situation, we can utilize a combination of frameworks:
Marketing Strategy:
- Segmentation, Targeting, Positioning (STP): BIG PASTURE needs to identify distinct customer segments based on factors like age, income, health consciousness, and dietary preferences. This will allow them to target specific groups with tailored marketing messages.
- Marketing Mix (4Ps):
- Product: BIG PASTURE should focus on developing and promoting organic, high-quality dairy products that cater to health-conscious consumers.
- Price: The pricing strategy should be competitive while reflecting the premium quality of the products.
- Place: BIG PASTURE needs to expand its distribution channels beyond traditional retail outlets.
- Promotion: A multi-channel marketing approach is essential, including online advertising, social media, influencer marketing, and offline events.
Competitive Analysis:
- BIG PASTURE needs to assess its competitors in the Inner Mongolian market. This includes identifying their strengths, weaknesses, and target markets.
- Understanding the competitive landscape will help BIG PASTURE develop a unique value proposition and differentiate itself from rivals.
Consumer Behavior Analysis:
- BIG PASTURE needs to understand the evolving consumer behavior in Inner Mongolia. This includes:
- Health consciousness: Consumers are increasingly interested in organic and healthy food options.
- Digital literacy: The use of smartphones and social media is growing rapidly, providing opportunities for digital marketing.
- Trust and transparency: Consumers are demanding transparency in food production and sourcing.
SWOT Analysis:
- Strengths: BIG PASTURE has a strong brand reputation in Inner Mongolia, access to high-quality dairy sources, and a dedicated workforce.
- Weaknesses: Limited distribution channels, lack of digital marketing expertise, and a need to improve brand awareness outside of its core market.
- Opportunities: Growing demand for organic dairy products, increasing digital penetration, and the potential for expanding into new markets.
- Threats: Competition from larger dairy companies, fluctuating milk prices, and potential changes in consumer preferences.
4. Recommendations
To achieve its growth objectives, BIG PASTURE should implement the following recommendations:
1. Develop a Multi-Channel Marketing Strategy:
- Digital Marketing: Invest in a comprehensive digital marketing strategy that includes:
- Website: Create a user-friendly website with information about the company, products, and sustainability practices.
- Social Media: Establish a strong presence on relevant social media platforms like Weibo, WeChat, and Douyin to engage with consumers, share content, and run targeted advertising campaigns.
- Search Engine Optimization (SEO): Optimize the website and social media content for relevant keywords to improve search engine rankings.
- Search Engine Marketing (SEM): Run paid advertising campaigns on search engines like Baidu to reach potential customers actively searching for dairy products.
- Influencer Marketing: Partner with relevant food bloggers, health influencers, and celebrities to promote BIG PASTURE products to their audiences.
- Offline Events: Organize events like farmers' markets, cooking demonstrations, and health seminars to connect with consumers directly and build brand awareness.
2. Focus on Building Brand Awareness and Trust:
- Transparency and Sustainability: Highlight BIG PASTURE's commitment to organic farming practices, ethical sourcing, and environmental responsibility.
- Content Marketing: Create high-quality content that educates consumers about the benefits of dairy products, healthy eating habits, and the company's values.
- Customer Relationship Management (CRM): Implement a CRM system to track customer interactions, gather feedback, and personalize marketing messages.
3. Expand Distribution Channels:
- E-commerce: Launch an online store to sell products directly to consumers, expanding reach and convenience.
- Partnerships: Collaborate with online retailers, grocery delivery services, and other food distributors to increase product availability.
- Retail Expansion: Strategically expand into new retail locations, focusing on health food stores, premium supermarkets, and convenience stores in key cities.
4. Invest in Product Innovation and Development:
- New Product Lines: Introduce new dairy products that cater to specific dietary needs and preferences, such as lactose-free milk, yogurt varieties, and cheese options.
- Packaging Innovation: Explore innovative packaging solutions that enhance product appeal, improve shelf life, and promote sustainability.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core competencies and consistency with mission: BIG PASTURE's core competency lies in producing high-quality dairy products. The recommendations align with its mission to provide healthy and sustainable food options to consumers.
- External customers and internal clients: The recommendations address the needs of both external customers (health-conscious consumers) and internal clients (employees and stakeholders).
- Competitors: The recommendations aim to differentiate BIG PASTURE from its competitors by focusing on building brand awareness, trust, and a strong online presence.
- Attractiveness ' quantitative measures: While specific financial metrics are not provided in the case study, the recommendations are expected to lead to increased sales, market share, and profitability.
6. Conclusion
By implementing a multi-channel marketing strategy, focusing on building brand awareness and trust, expanding distribution channels, and investing in product innovation, BIG PASTURE can successfully navigate the changing market landscape and achieve its growth objectives.
7. Discussion
Alternatives not selected:
- Exclusive focus on traditional retail: This would limit BIG PASTURE's reach and fail to capitalize on the growing online market.
- Aggressive price discounting: This could damage brand perception and lead to lower profit margins.
Risks and key assumptions:
- Competition: The success of the recommendations depends on BIG PASTURE's ability to effectively compete with larger dairy companies.
- Consumer preferences: Changes in consumer preferences could impact the effectiveness of the marketing strategy.
- Technology adoption: The success of the digital marketing initiatives hinges on the continued adoption of technology by consumers in Inner Mongolia.
8. Next Steps
To implement the recommendations, BIG PASTURE should:
- Develop a detailed marketing plan: Outline specific marketing objectives, target markets, budget allocations, and key performance indicators (KPIs).
- Build a strong digital marketing team: Hire or train staff with expertise in digital marketing, social media, and content creation.
- Establish partnerships: Collaborate with influencers, online retailers, and other relevant businesses.
- Monitor progress and make adjustments: Regularly track marketing performance metrics and make necessary adjustments to the strategy.
By taking these steps, BIG PASTURE can successfully navigate the changing market landscape and achieve sustained growth.
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Case Description
BIG PASTURE Animal Husbandry Company (Group) Co., Ltd. (BIG PASTURE) had achieved great success after nearly 10 years of development. It had started as a ready-to-eat food processing factory that supplied individually owned stores and franchises with self-produced food. Since then, its product line was extended to include fresh and processed beef and mutton. At the same time, BIG PASTURE undertook a major shift from company-operated stores to community convenience stores, further fostering its community economy. However, since the rapid development of e-commerce had contributed toward the success of many local sellers in China, BIG PASTURE saw the possibility of a breakthrough. Thus, the major challenges facing the company included creating a national market through e-commerce and developing community economies.
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