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Impulsive Chewing Gum Consumer: Pushing a Re. 1 Product in Indian FMCG Market

Code : MM0071

Year :

Industry : FMCG

Region : India

Teaching Note:Not Available

Structured Assignment :Available

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Indian Gum Market The Indian gum market can basically be classified based on the price, into the Re. 1 gum market and others which includes gums sold above Re. 1 – mostly at Rs. 2 and Rs. 5. The gum market is also classified into the bubble gum market and the chewing gum market. The chewing gum market is sub-classified into sugared gums and sugar-free gums. In the confectionery segment, the gum market was growing at a faster pace than others....

Products Prior to the introduction of BoomFresh Mint, Wrigfetti India, the parent company, sold BoomFresh Strawberry, BoomFresh Jelly, and BoomFresh Duet in the Re. 1 category, with around 80% of the sales coming from BoomFresh Strawberry, 18% from Jelly, and only around 2% from BoomFresh Duet...

Distribution Wrigfetti manufactured BoomFresh in Himachal Pradesh (a state in North India). BoomFresh was sold through various distribution centers across India. The distributors took BoomFresh from the distribution centers and sold the product directly to the retailers who sold it to the consumers or tied up with sub–distributors who in turn sold it to the wholesalers or directly to the retailers...

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Little Maneuverability All the variants of BoomFresh were sold at Re. 1 to the consumers. The retailers who had to buy the gum in jars bought the jars at Rs. 132 each. The jars contained 160 gums, which were sold at Re. 1 each, The retailers thus realized Rs. 160, resulting in a profit of Rs. 28 per jar. The profit of Rs. 28 was much more than the margin of Rs. 22 offered by Wrigfetti’s competitor....

Promotion Wrigfretti spent a substantial amount on advertisements. Television and radio advertisements were brought out very often. A substantial portion of the television advertisements was aired on kids’ channels as children were considered to be the major target market. Wrigfetti’s competitors, on the other hand, spent a major amount on kids’ channels but also made their presence felt on other major channels....

Market Insight To help Mr. Jain get a better understanding of the gum market and especially about his BoomFresh brand, Wrigfetti authorized a market research firm, Market Intelligence, to do a market study on BoomFresh after the first three months of launching the mint variant. The firm came up with the following insights....

On Mint Flavor It was observed that the majority of distributor-driven outlets sold BoomFresh Mint, whereas in a market which was driven by wholesalers, the outlets did not have BoomFresh. It was also found that distributor-driven outlets were more aware about the new variant which also meant that the wholesalers were not pushing BoomFresh Mint....

General Grievances Retailers were also general in their comments, giving views ranging from the taste of the product to creating awareness of it. Some of the retailers complained that the taste of the gum was bad and that the competitor’s products tasted good. Retailers also complained about the bad packaging (BoomFresh was wrapped around by paper which often stuck hard to the gum). ....

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