Al Madinah Dates Co. is among the major manufacturers and exporters of dates from Saudi Arabia. The company has been a success for the past three decades with its wide range of Saudi Dates products. The company started its operations early 1990s under the promotion of a group of reputable Saudi entrepreneurs. Al Madinah aims at increasing its global market through vigorous marketing campaigns, especially in the United Kingdom where the product is not common. It also intends to spread the product to Muslim consumers in other Asian countries, such as India, Indonesia, and China, where there is insignificant production.
Its range of dates products include the vacuum packed dates, hand-crafted bamboo baskets, dates paste, pressed dates, canned dates, loose plated dates, elite dates, hand-crafted brass dates, and loose dates bulk. However, the most recent product that has gone viral is the luxurious and exquisite dates chocolate. The company has been able to obtain its reputation and customer loyalty because of its innovative and quality brands. The company should engage in marketing for its dates.
This report has focused on a marketing plan employed by Al-Madinah in selling its dates and dates products to Indonesia. The company targets the millions of Muslims in the Indonesia due to their high demand for this highly nutritional fruit. This paper analyzes the market Country, cultural profiles, competitor analyzes, market analysis, market entry, and strategic recommendations. The report justifies the marketing plan used by Al-Madinah in selling in Indonesia and evaluates it. I have chosen this company due to its aggressiveness in regards to marketing and successful growth in the recent years.
Introduction: Marketing product (dates)
Dates are fruits belonging to the palm family called Arecaceae and consumable by human beings for various nutritional purposes. Their consumption can be traced back to the historic classical civilization and agriculture in Egypt and Mesopotamia whereby it was the staple food. The product has been considered to be one of the staple foods for the countries in the Middle East and Horn of Africa since they are the major producers and manufacturers of dates. The Middle East produces over 80% of the global dates whereby Saudi Arabia produces a significant portion estimated to be 10 Million tons each year’s average. The prevalence of the date palms in the high production areas of The Middle East and North Africa are associated with the favorable warm climatic conditions for the plants in the countries (Asif & Al-Ghamdi 2006, p.12).
Dates are of various types and considered one of the sweetest fruits edible by humans. Normally, the fruit is dried in most parts of the world before consumption although it can be taken while fresh. Whether fresh or dried up, the health benefits of the fruits are phenomenal. The fruit products can be mixed with other foods to make more delicious meals (Yahia 2011). Nutritional value involves its contents, such as minerals, sugar, vitamins, and fiber. Vitamin content includes riboflavin, folate, and vitamin A and K. Mineral contents include calcium, phosphorus, potassium, sodium, zinc, and magnesium. These nutritional contents can give humans various health benefits (Al-Redhaiman 2003, p. 06; USDA National Nutrient Database for Standard Reference 2010).
Eating dates enhances the strength of bones and healthy growth. Nutritionists believe that the mineral and vitamin intake that is high in dates are the main reason they facilitate strong bones. The contents shield consumers from intestinal disorders and anemia whereby the minerals supplement dietary functions. These fruits are a good source of energy for the body because they have high contents of sugars, such as glucose. Other reasons why most people love to eat dates and their products are because they facilitate a healthy nervous system, cure allergies, and control diarrhea (Al-Redhaiman 2003, p. 13). However, recent health studies have pointed that dates can significantly reduce risk to abdominal cancer attacks while others believe that the fruits boost sexual stamina. (American Cancer Society Complete Guide to Complementary & Alternative Cancer Therapies 2009).
Description and Justification for Country Recommendation
Dates are rampantly consumed in most parts of Asia, but the Republic of Indonesia does not enjoy much of the fruits that majorly come from Mideast, over 85%. It is a rare but highly demanded product in this country recognized with a huge population of about 240 million people. This means that dates are imported from major producing nations, such as Saudi Arabia, Egypt, and Iraq. Importation increases the cost of the fruits making them relatively expensive compared to other countries. This creates an opportunity for Al-Madinah, which seeks to export quality dates and their related products to this particular country.
The Republic of Indonesia is the perfect market for the dates due to its fascinating characteristics. Most importantly, the Islanders have embraced the consumption of dates considering its nutritional and medicinal values. The country has a high population that will create an extensively big market that will ensure high sales. Furthermore, the market is characterized by appropriate and definite cultures and religions that all concur with the consumption of dates. The technology and economy of the country is ideal for marketing and selling of the dates whereby it is believed that Indonesia is among the top 20 nations with the highest economies in terms of gross and net domestic products, GDP and NDP. (World Bank, 2013).
People all over the world have come to realize the health facts and importance of dates hence a rise of many companies that manufacture and sell dates products. There are several organizations in the Middle East states that engage in manufacturing and processing of a variety of products from dates and sell them to countries that have inadequate, such as the intended market country of Indonesia. The United Arab Emirates-based companies, such as Al Foah Co. and Al Barakah Dates are some of the businesses that pose stiff competition to Al-Madinah. These companies have a variety of dates products and established business in the industry hence pose a serious challenge. The competitors may stand a better chance because they manufacture and pack the dates differently using the latest technology.
Another company that gives cut-throat competition is Azzad based in Al Ain, UAE. The company was established in 2009 and has specialized in manufacturing and packaging of high-quality dates to both the local and foreign customers. Since the local market is almost saturated with several local manufacturers, it also seeks the external markets, Indonesia being one of them. Some of the competitive advantages Al Madinah, however, have are brand loyalty and wide marketing networks. Their packing is the best in terms of uniqueness and quality making most customers to prefer their dates to those of their competitors. Al Madinah either employs the best marketing strategies compared to their competitors whereby they use the current technology to develop market country domains with the best web designing to sell its name.
The market structure is a monopolistic competition. All the sellers in the market are foreign companies, and they are quite many in the number serving the big market of the populous country. The size of the market is estimated to be about 210 Million out of the possible 240 Million whereby the portion of customers is Islamic (“BadanPusatStatistik,” n.d.). Muslims are the target considering their need for dates, especially during the Ramadhan. Currently, the market has shown preference to dates chocolate. Another issue trending in the market is the high rate of demand for dates during the season of Ramadhan. The competitors are observing the trends in changing of tastes and preferences.
The Indonesian market is quite rigid in terms of segmentation. The market segments are two; Muslims and non-Muslims, whereby the two perceive the use of dates differently. The most important segment is the Muslim side with a population of over 210 Million, forming over 80 percent of the Indonesian population (“BadanPusatStatistik,” n.d.). The market targets in the Islamic segment are those individuals that purchase dates for Ramadhan or religious purposes, and those who buy them as a snack food. The other non-Islamic segment buys the product as a snack food or as a supplementary with other foods to make delicious meals. However, Al Madinah is focused on the Muslim segment since it is characterized by certainty in purchasing especially during Islamic holy days.
However, targeting the whole populations in the entire Indonesia is not easy especially the vast geography and inadequate and unreliable infrastructure to some regions. Therefore, al-Madinah seeks to focus on the urban sections of the market segments since these customers will be easy to reach and supply them with the product. The choice of the urban targets is solely out of convenience brought about by quality infrastructure to enhance transport and marketing. The company has specifically pointed out that it majorly focuses in the high population found in the capital, Jakarta.
The people of Islamic faith are associated with dates since the fruits are considered to be their traditional cultural foods. These fruits have been consumed since the ancient world to the extent of being mentioned in the Holy Quran as a staple food. Dates have been mentioned in the Quran over 20 times hence there is a clear evidence that they have been a meal for so many centuries especially for the Muslims. Dates are purchased extraordinarily during the Ramadhan and other Islamic holy days since it is believed that dates and milk or yogurt were traditionally consumed as the first meal during Iftar during Ramadan. The close connection of dates with the Islamic religion and culture makes this group the perfect target market (Musselman 2007, p.57).
Indonesia has diverse ethnic groups that have different cultures. However, the most distinguishing culture is the religion. The easily observable cultural differences are observed between Muslims and non-Muslims. Applying Hofstede’s theory of cultural dimensions, there are plenty of cross-cultural communication dimensions that can be applied to understand the Indonesian market. There is the aspect of individualism whereby the people of this country have integrated into ethnic and religious groups although the latter is outstanding. The Islamic collectivism, therefore, is an identifiable characteristic especially when they demand more dates in special periods like the Ramadhan.
The Indonesian Dates market is characterized by masculinity due to its nature of assertiveness and competition. The country is full of activity, and the masculinity scale is estimated to be about 52. The country has structured itself to deal with surprising situations with uncertainty avoidance of about 25, considered to be a low uncertainty avoidance level. Some of the measures taken by authorities in Indonesia to avoid uncertainty include; bulky importation of items not locally made. In the case of dates, the supply and demand forces work together to ensure that the product is in the market although the country majorly depends on foreign countries.
Halls theories can also depict the clear profile of the various Indonesian cultures. Applying time dimension, people from this country are polychromous in nature. This means that they do not engage in doing a particular thing in any given time hence they get involved in various activities at the same period (Hall & Du 1996, p.27). Since Indonesia is a big economy, it is full of activities, and its people engage in many activities. Regarding flow of information, it flows and spreads very fast. Such a culture with fast-flowing information enhances good communication. The dates market could benefit from this especially in its marketing objectives since the people could be reached fast enough than expected.
Country of Origin, Foreign and Domestic Consumer Predispositions
The United Arab Emirates is the home country or origin of Al Madinah Dates Company and has always had the best ties with the Far East and other Asian countries such as India and Indonesia. The good diplomatic relations between UAE has enhanced the best trade relations hence companies in these countries can import and export various products without many border restrictions. Considering the good relationship between the countries, selling dates in the Indonesian market is as simple as selling them in the home market.
Thanks to the modern era, the issue of ethnic differences is a forgotten thing in Indonesia. The people consider themselves as one regardless difference in religion and other cultural values. Therefore, ethnocentrism does not exist in this country. The small ethnic groups that exist in this country have merged to one big country that shares common values. Another interesting fact about Indonesia is that the market country is not characterized by consumer animosity. The market does not have bad blood, as the consumers are always calm awaiting delivery of goods and services; basically due to modernization and civilization.
However, the Indonesian market is characterized by consumer disidentification to some extent. Here, most consumers show biases when it comes to locally manufactured items hence often may disregard foreign goods. The mentality is that foreign goods are always expensive compared to those locally made. However, when it comes to dates, they are but rare fruits to find them in local manufacturing. Therefore, almost all dates and their related products are purchased from the Middle East. This plus the consumer affinity in the market creates an enabling environment market for exporting companies such as Al-Madinah to sell its products.
Market Entry and Expansion
Al Madinah is planning to enter the Indonesian market as foreign direct investment through licensing. The company will establish its offices in Jakarta where it will work with one of the snack companies to distribute the product and get royalties paid to them in return. They will export the dates to the country and store them with their affiliate and await for distribution that will depend on demand. The entry technique avoids several issues especially the legal issues such as tedious legal requirements to establish in the new country. Licensing a local firm to distribute its dates would also reduce costs that would otherwise have been used to build a Greenfield investment (Dimelis & Louri 2001, p. 33).
However, market entry techniques do not always ensure success; hence, there is need to penetrate the market by using various marketing strategies. Marketing is required because there is a possible threat from competitors and need to keep the market aware of the new brands. The intended marketing campaign is mainly through the online platform where it will obtain a domain with an extension from the country market. The website will contain all the information regarding the dates from Al-Madinah, and customers would have the ability to order them online. However, since this is a snack food to most people in the market, there will be the need for media advertising i.e. print and electronic media that can reach the entire market.
Another marketing strategy is the use of online portals as in e-commerce. The business-to-business (B2B) model such as alibaba.com would enable Al-Madinah to increase its sales. Alibaba is the leading B2B online portal in the Republic of Indonesia hence using it would enable increased dates sales due to high reach to the portal users. Google Ads could also do well towards entry into the Indonesian market whereby the search engine company can place ads on various websites (Ryan & Jones 2009, p.17). The fact that almost the entire target market, especially in Jakarta, use various mobile devices to access the internet, they will be able to access the portals and Google ads hence easy market reach (Gaol 2014, p.46).
The company suggests they use of nice designs of the dates printed on billboards in major urban areas. For instance, a yummy look may attract customers to like the product, especially with its quality packaging. To be sure of a high rate of expansion, it will include the use of social media where it will establish customer page and handle to sell the name of its quality products. However, since there are potential competitors, the company will look to establish brand loyalty as soon as possible. Otherwise, the results will not be good new to the company.
Indonesian market may not be easy to penetrate and survive without strategies. There are some factors that Al-Madinah ought to consider to enjoy successful business in this host country. Most importantly, they should review their pricing. When compared with their potential competitors in the Dates market, the company charges relatively higher than the rest. It would be ideal to cut down its prices by some margins and still maintain their profitability. Appropriate pricing would give them a better chance to knock out its competitors (Paley 2005, p. 14; Schaeffer 2008, p. 22).
Innovation strategies are important towards acquiring a big share of the market. Dates can be many types, but the determining factor in the market competition is the innovativeness in the manufacturing and packaging processes. Al Madinah could do better with more innovation regarding more package designs, more flavors, and other forms of differentiation. To gain a competitive advantage that could sustain them, the company should ensure that their brands are everyone’s favorite through the best differentiation in terms of color, design, and packaging (Phillips, Hoberg, & National Bureau of Economic Research 2010). However, the company should come up with other ways of selling dates, that is, with add-ons, such as chocolate and can also use them with some pastries. (Kaiser 2001, p. 109).
Aggressive marketing campaign ought to be used. This is because the company will face stiff competition from other firms, especially in the Middle East. Cultural promotion, media, and online platforms can be used to reach the customers. The company should however use catchy messages during their marketing campaign and employ consistency to convince the customers. However, it will bear greater fruits if the company used the online portals they intend to use (Paley 2005, p. 14).
Appropriate market segmentation could facilitate achievement of a competitive advantage that is sustainable for the company. It should identify the best market segments that can sell its dates. Indonesia, in particular, has the majority as Muslims and could use this segment that considers dates a traditional and important fruit that has flourished throughout their culture and religion since the historical past. Therefore, the Islamic group would be the perfect market segment, especially during holy months of Ramadhan when dates are in the highest demand (McDonald & Dunbar 2004, p. 12-17).
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