Transcript Poland

Poland
Country Market Analysis
Demographics
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Gender
 Women make up 51.4% of population, mostly in cities
 Average age of man: 33 years old
 Average age of woman 37 years old
Age
 Half of people in Poland under age 33. One third under 19
 Youth
 Consumption oriented
 Brand label aware
 Elders
 Traditional
 Prefer known and tested products
Income
 Average household income low: Poles that make between $125$250/mo is 78.7%
Geographic
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Poland’s total population is 38.7 million
Largest city is Warsaw with population of 1.6
million
 Next two largest cities are Lodz and Krakow
Unemployment is 17.8%
Urban
 More likely to spend money
Rural
 Have higher unemployment
 Man to Woman ratio more balanced
Product
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Size
 Bottle size of competitor’s soda (Coke) is .33L~11 oz.
 Consume beverages in smaller sizes
 Size of refrigerator only 1.8 meters
Labeling
 It is required by law to have product description somewhere
on or inside the package. Must clearly state country of
manufacturer
 Name and address of producer
 Composition/Ingredients
 Net weight of contents
 Durability/Storage instructions
Product
 Nutritional
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Energy value and proportion of nutrients must be in units per 100
grams or 100 milliliters.
Information on vitamins and minerals must be as a percentage of
recommended daily allowance
 Many
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value is required and must follow Polish standards
women are on “diets”
Coke is referred to as Coca-Cola Lite
 Metric
system used
 Prefer simple, self explanatory labels
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Poles are impressed with quality of packaging when labels are thick
and strong
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Traditional labels are “stiff ”
Product
 Companies
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have found that using English on packaging helps
give product additional prestige or value
Language
 Official language is Polish (98.7%)
Packaging
 Required to take measure in using recyclable materials
 Coke uses glass bottles with metal caps, while Hortex uses
plastic bottles with screw on caps
Additives
 Label must declare either aroma, natural, artificial or any
combination
 Same additive regulations as other EU countries, but can
declare new additives. For example, neotame, a sweetener
used only in Poland
Product
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Color
 Black tea preferred. Coloring of teas is usually dark
Flavor
 Ceylon, a blended tea is found to be most popular in the tea
market
 Tea drinkers are developing tastes for green and fruit teas, as
well as spice imperial, ginger, and almond
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Competition
 Brands:
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Product
There is much competition from local production and exporters from
the EU countries. They tend to prefer Polish products to imported
goods.
Coke, PepsiCo, Tetley, Posti, and Dilmah (account for 70% of teabag
market)
Private label products available at hypermarkets and supermarkets
50 brands of tea in the Polish market
Other competing beverages
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Black tea is the most popular hot tea:
 Assam Best, English Breakfast, Darjeeling First Flush, Earl Grey
Coffee is the most developed area of the hot drink market with Kraft,
Tchibo, Nestle, Sara Lee, and Elite Group
Hellena is one of the top soda and juice competitors
Hortex is the leading fruit juice producer which is recognized by 97%
of population
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Retail Price
 Polish currency is Zloty. Now after joining EU,
they have adopted the Euro
 Pricing is key to effective selling of a U.S. product
in Poland
 Flexible pricing in order to obtain market
penetration and gain product knowledge
 Commercial Service in Warsaw says a common
complaint is that U.S. prices are too high
 Price more significant for women, people with
secondary educations, rural consumers, and blue
collar workers
 Polish teas sell for about $6 for 200grams (8 oz
box).
Price
Price
 Young
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Poles in cities are less price sensitive than older
generations and rural Poles
 Urban areas have higher purchasing power and are more
willing to spend on consumer goods
Money
 Poland is a cash economy with little or no credit access or
checking accounts
 Can take 2-4 weeks to collect money on a sale, so cash
management services can make significant difference in
business profitability
Placement
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Unilever in Poland
 Products that are currently in Poland
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Domestos: household bleach
Hellmann’s: #1 mayonnaise brand worldwide
Dove: skin and beauty product
Sunsilk: shampoo
Cif: household cleaner
Rama: margarine
Knorr: food spices, bouillons, etc.
 Parallels
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Polish lifestyle and how tea is incorporated
Tea houses similar to U.S. coffee houses (Starbucks)
Tea viewed as a chance to break from daily routine of life
Placement
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Storage and Distribution
 Retail and wholesale market fragmented with thousands of
small companies. While they dominate the market, they have
less than $1 million annual sales. Difficult to distribute to
such a large amount of small companies.
 45% Poles shop in small stores. Hypermarkets are on the
rise, but still some customer resistance due to their large size.
 Distributors manage entire logistics process from
warehousing and transportation, in addition to dealing with
retailers.
Placement
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Logistics Providers in Poland
 ProLogis
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World’s largest developer and leaser of logistics facilities
Located in central Poland, work for Unilever
Created ProLogis Park Protrkow which is a large distribution center for
Unilever in Poland
 Unilever
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Bestfoods
Located in London, UK
Leading suppliers of fast moving consumer goods
They selected Power Europe to develop and manage a new automated
national distribution center at Kingswood Lakeside in Cannock,
Staffordshire, which will handle Unilever’s Bestfood distribution
requirements
 Ready for distribution in September 2005
Placement
 Tibbett
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International logistics specialist working under long-term contracts
with retailers and manufacturers, especially in the food and beverage
industry
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Currently under contract with Unilever
 Maersk
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and Britten Group
Logistics
State-of-the-art warehousing and distribution center in Mszczonow
Operates in more than 70 countries
Production Facilities in Poland
 Products in Europe:
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Bydgoszcz- Responsible for home and personal care products in
Europe
Kotowice- Responsible for Unilever Bestfoods in Europe
Placement
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Transportation
 Road System
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50% of roads are considered unsatisfactory and need immediate
upgrading and 35% are poor
Weakest aspect of Poland’s infrastructure and a major handicap to
business in economic development
Lack of adequate highways between major cities
Rural roads are dangerous and difficult to travel on
Toll Roads are being created in an effort to help the current road
system
Possible product logistics company, Ryder System, Inc. which
provides logistics and transportation solutions in Poland
Placement
 Railways
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Polish State Railways (PKP)
High quality and interconnect with neighboring cities such as Vienna,
Prague, and Berlin. However they need substantial restructuring
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the future a mix of both railways and road ways are
considered best prospect of growth for Poland
 Warsaw relies on metro system
Quantity Amounts
 Poles buy in small amounts until know and trust product
 Wait to see how product sells and if favorable then
consumers will purchase in bigger bulk
Placement
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Channels of Distribution
 Shipped from manufacturers to warehouses via air and
seaport then shipped via roads or railways to local groceries
or other means of sales
 Traditional grocers are the largest and most popular retailers
Joint Ventures
 Very abundant in Poland
 In a typical joint venture, American companies contribute
capital and technology, while Polish companies contribute
land, distribution channels, trained workers, and legal and
business knowledge
Promotion
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Media Availability
 Poland is very literate and college attendance continues to
increase,
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Print advertising has become a popular media source
 Advertisements
need to be translated into Polish since it is
the primary language
 TV
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Television is the largest broadcasting network in Eastern and Central
Europe
Is most expensive media for advertising, but most effective means of
advertising
Promotion
 TV
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Most important source of information for Poles
Products advertised via TV show the greatest sales growth of all
advertised products because the average Pole watches 4 hours of TV
a day
Rates for 30 second slot during peek hours, 7:45 to 10 pm of top
three competing channels:
 TVP1 and TVP2 are state owned most watched
television=$15,533
 Polstat= $14,448 (both have nearly 100% market penetration)
 UPC Telewizja Kablowa is leader in cable channels
 Cable not effective since less than 30% of Poles have it
Downside: limit to total ad time because only 15% of commercial air
time is allowed for advertising
Promotion
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Newspapers
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Cinema
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Very well circulated throughout Poland—newspapers can be found
everywhere
Low readership: fewer than 30% of Poles read any kind of newspaper—
this rate is declining
Advertising cost for popular daily newspaper (1 page b/w)=$14,682
Roughly 28 million cinema attendances per year.
Cost for 60 second time slot per screen per week= $265
Magazines
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Hard to predict sales levels because majority of periodical sales occur at
kiosk stands, with subscriptions representing less than 4 % of total sales
Promotion
 Magazines
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Many special interest magazines, business journals, niche publications,
and specialized newspapers, which is good for reaching target market
since there is fragmentation of the market
Advertising cost for monthly magazines (1 page, color)=$12,399
 Outdoor
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Frequently used on buses, trains, and subway and metro platforms
Outdoor advertising costs:
 5 X 2 ½ meter panel= $200
 12 X 3 meter panel= $2,000
 Personal
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Advertising
Selling
Direct Marketing
 Direct marketing in Polish countries has grown to 38%
 Each Pole receives 10-12 items per year of promo/ad mail
 Very expensive: average cost is $28,310
Promotion
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Direct Marketing
 P&G tested direct marketing by sending out shampoo samples to
Poles. Received very positively and P&G’s sales increased
Event Sponsorship
 Soccer is a popular sport in Poland with many sponsors at the
tournaments
 Lipton currently sponsors tennis tournaments in other countries
Personal Selling- sampling the product
 Many Poles will not consider final purchase until meeting face to
face
 Demonstration very effective
 Samples of coffee and other beverages being passed out in
hypermarkets throughout urban areas of Poland
The End
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