Question

Case study 3

Mr. Hamood joined newly as a Marketing Manager in a famous Ibra Ice Cream Company in Oman. The company‟s ice cream had huge demand as the ice creams were tastier and had more flavours. The company introduced a New Ice Cream named “Taste Bites”, and wanted to market all over Oman. Mr. Hamood was made responsible for marketing the new product, He called his staff for a meeting and discussed the various strategies to market the new product. He also suggested the marketing director to set high price for the new product.

Mr. Yaqoob, the Marketing Director of the company was worried about the pricing of the new ice cream introduced by the company. Mr. Bilal, the Sales Manager, who use to take care the pricing of products, had recently resigned from the job and left the company. Now pricing responsibility was also given to Mr.Hamood. As Mr. Hamood is new and already assigned with marketing responsibility was seriously looking for someone to help and advise him with this new task. The company was having issues related to pricing, wholesaling, retailing, and dealing with broker & agents. They have to choose the best course of action to capture the market share.

Question 3

i.    Comment on Mr. Hamood‟s with various steps to be followed in planning and developing the

new product „Taste Bites‟ in the company.                                                (5Marks–125/ 150 words)

ii.   Evaluate the pricing strategy adopted by Mr. Hamood for the new product.

(2 Marks– 50 /75 words)

iii. Can Ibra Ice Cream Company be started as a specialty shops? Comment.

(3 Marks–75 / 100 words)

Answer 1

1	Mr.Hamood need to be followed below steps for Planing and developing the new product.
	1. Generation of New Product Ideas:
	The first step in product planning and development is generation of ideas for the development of new/innovative products.
	Ideas may come from internal sources like company’s own Research and Development (R&D) department, managers, sales-force personnel etc.; or from external sources like, customers, dealers, competitors, consultants, scientists etc.
	2. Screening of Ideas:
	Screening of ideas means a close and detailed examination of ideas, to determine which of the ideas have potential and are capable of making significant contribution to marketing objectives. In fact, generation of ideas is not that significant as the system for screening the generated ideas.
	The ideas should be screened properly; as any idea passing this stage would cost the firm in terms of time, money and efforts, at subsequent stages in product planning and development.
	3.Product Concept Development:
	Those product ideas which clear the screening stage must be developed into a product concept – identifying physical features, benefits, price etc. of the product. At this stage product idea is transformed into a product concept i.e. a product which target market will accept.
	4. Commercial Feasibility:
	At this stage, the purpose is to determine whether the proposed product idea is commercially feasible, in terms of demand potential and the costs of production and marketing. Management must also ensure that product concept is compatible with the resources of the organization technological, human and financial.
	5. Product Development:
	Product development encompasses the technical activities of engineering and design. At this stage, the engineering department converts the product concept into a concert form of product in view of the required size, shape, design, weight, colour etc. of the product concept.
	6.Test Marketing:
	A sample of the product is tested in a well-chosen and authentic sales environment; to find out consumers’ reaction. In view of consumers’ reactions, the product may be improved further.
	7. Commercialisation:
	After the management is satisfied with the results of test marketing, steps are taken to launch a full-fledged programme for the production, promotion and marketing of the product. It is the stage where the new product is born; and it enters it life cycle process.
2	5 common pricing strategies
	Pricing a product is one of the most important aspects of your marketing strategy. Generally, pricing strategies include the following five strategies.
	1. Cost-plus pricing—simply calculating your costs and adding a mark-up
	2. Competitive pricing—setting a price based on what the competition charges
	3. Value-based pricing—setting a price based on how much the customer believes what you’re selling is worth
	4. Price skimming—setting a high price and lowering it as the market evolves
	5. Penetration pricing—setting a low price to enter a competitive market and raising it later
3	Yes, Ibra Ice Cream Company can be started as a specialty shops.