Marketing Planning

Group Project
On

Mentos
(Section 1)

Submitted to
Prof Anita Goyal

By
Group 10
Section A

Mangement Development Institute

Gurgaon-122001

Word Count: 1580

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 Mentos
(The background)
In 2000, Perfetti Van Melle (India), the wholly owned subsidiary of world’s third
largest confectionery company launched Mentos in India.
Mentos has been PVM’s largest brand and is world’s second largest
confectionery brand. When it first came into India the company extended its
global positioning strategy of the brand as the ‘freshmaker’ but it soon realised
that the Indian consumer could not identify with the tag line. This led to the
localization of the brand leading to the immensely successful “Dimaag ki batti
jala de” and the “Aam zindagi/Mentos zindagi” campaigns. They also learned that
India is totally different market from the global markets in the following ways.
1. India is a primarily mono-pack market as compared to global multi-pack
market and 90% of Mentos sales are from individual dragees.
2. The trade patterns are significantly different with organised sector comprising
just 60% of market share of the confectioneries industry (in 2000). Also here
retails outlet like paan shops and kirana stores resulting in the bulk of sale
leading to to a great deal of logistical difficulty.
3. Presence of legal bottlenecks like the obsolete Prevention of Food
Adulteration Act which hinders growth in many ways:-
• Products like sugar free which are used worldwide cannot be used
• Limits like 3.5 percent of moisture content a slight default from which
makes one liable to criminal offence
4. Very competitive selling prices of 50 paise. made it difficult for the company to
innovate on the price front because the margins in the industry were very low.

The company subsequently had to adopt a brand marketing strategy suited to the
Indian environment resulting in a strong brand image of Mentos in the mind of
the Indian consumer.

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 Swot Analysis of Mentos

Strengths:
Excellent promotion
Funny and creative ad campaigns have made Mentos have very high brand
awareness and recall.

Effective distribution
It is available at every cigarette wallah and paan shop. It is available at over 20
lakh outlets.

Unique position on the perceptual map

Its chewy texture gives it a differentiating position in the market. All its
competitors are either hard boiled sweets or chewing gum.

Large product range

Mentos is available in a wide variety of flavours and variants which gives it an
edge over single flavour brands such as Polo and Chlormint.

Successful brand positioning

The funny and irreverent ad campaigns has led Mentos to be identified as a cool
and trendy product by its target demographic, the youth

Weaknesses:
Rock bottom price
Due to its low price of 50 paise it is difficult to pass on any increase in input costs
or taxes to the customer.

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Not strong enough
It is not the first choice of smokers who prefer a stronger taste. They form a
major part of the consumers who buy breath freshening candies.

Chewy texture
Although its chewy texture gives it a unique positioning it also makes it
unappealing to many who prefer traditional hard boiled sweets.

Opportunities
Global trends
The per capita consumption of sugar confectionaries in India is only 250 gms per
capita while it is 4.89 kgs in UK and 7.81 kgs in Denmark and so there is plenty
of scope for growth for everyone.

Shift to organized sector

The ratio of organized to unorganized sector in the Indian confectionary market is
60:40. As customer affluence increases the demand for quality goods will also
increase

Forecasted growth
The Indian confectionary industry is worth Rs 2000 crores and is expected to
grow at a compound annual growth rate of 8 percent through 2011. The soft
mints category, however, is expected to grow at a rate of 30-40 per cent on a
year-on-year basis.This growth is primarily due to the retail revolution in India,
increased consumption of affluent customers and the increase in the pocket
money of children.

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New flavours
Perfetti could try launching some of its international flavours such as green apple,
cinnamon and pineapple in India either as a limited-edition, novelty product or a
permanent part of its product range.

Gift set
Mentos could also try introducing a trendy Diwali gift set as an alternative to
traditional Indian sweets and dry fruits.

Threats
Intensity of competitive rivalry
It is a low involvement, impulse purchase making it easy for a rival product with a
better marketing campaign to capture some of Mentos’s market share.

Substitute products
Its rivals do not just include chocolates, chewing gum and toffees but also
traditional Indian sweets such as jalebi, paan and mithai. Besides consumer
preference for chocolates is increasing as income levels are going up.

New rivals
A new entrant like Mars or Hershey Food could significantly eat into its market
share

Competition
Mentos not only competes against rival products from by Nestle, Wriggley’s,
Candico, Cadbury’s, Ravalgaon, Dabur and ITC but also competes against its
sister products from Perfetti (Chlormint, Alpenliebe, Centre Fresh)

Customers
Increasing health awareness could affect the sales of sugar-based products.

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Distribution
The distributors operate on a margin of 6-7% while it is 10-15% for retailers. This
is at the lower end of the industry standard. An increase in input costs cannot be
absorbed any further without raising the price or reducing the quantity.

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 MARKETING MIX

Product:

• Mentos is a product of Perfetti Van Melle (PVM) and is the world’s second largest
sugar confectionery .

• The Mentos candies fall in the category of chewy dragee. The candies have the
unique positioning of being hard and crunchy on the outside, which when chewed
disintegrates to a soft gum-like consistency and releases its breath freshening
characteristics.
• Mentos is produced in India in 3 flavors: mint, strawberry and lime but is also
available in grape and mixed fruit by importing packages from Arab countries and
repackaging it in India. Assorted flavors are also imported and repackaged.
• The candies are packaged in mono-packs or rolls of thirteen and the weight of
each individual candy is 37.5 gms.
• PVM India focuses primarily on the mono-packs, which form 90% of Mentos’
market. This strategy is derived from the fact that India is largely a mono-pack
market as against the global scenario, where confectioneries are largely a multi-
pack market.

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Price:

• Mentos is a low involvement, impulse purchase product which is priced at 50

paise for the mono-packs and Rs 5 for the rolls
• Competitors, however, have similarly priced products and stiff competition has
made sure that prices are largely constant. Thus, price is not really a
differentiator in this category.
• However due to its price of 50p it is difficult to pass on any increase in taxes or
input costs to the customer.

Place:

• Mentos is distributed across India by Perfetti Van Melee’s strong distribution

network which has around 4500 distributors across 2000 urban towns.
• It is stocked at over 20 lakh outlets of which 25% are paan shops.
• The bulk of the sales are derived from unorganized mom-and-pop stores paan
wallahs and kirana shops. This leads to significant logistical difficulties.
• The retailers have an operating margin of 10-15% while it is 5-7% for the
distributors. This is lower than the industry standard of 15-17% and 7-10% for
retailers and distributors respectively.

Promotion:

• Mentos is primarily targetted at the youth and college going crowd, belonging to
sec’s A and B who can relate to the funny and irreverent campaigns.
• Most ads in this category generally talk about fresh breath or the more tongue in
cheek suggestion that mints help a guy attract a girl. That’s where Mentos ads
deviate from the other ads in this category. “Mentos doesn’t talk about the
functional benefit at all – it works on a psychological level, where people
associate the brand with the imagery of ‘smartness’.

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• Mentos uses freshness, unlike its rivals, not as a product attribute, but as a state
of mind in its promotion. Some of its most memorable tag lines include “Dimaag
ki batti jala de” and “Aam zindagi/mentos zindagi”.

• The advertising account is handled by Ogilvy & Mather India Ltd which has won
numerous creative awards for its innovative and imaginative Mentos promotions.
• The latest advertisement by Mentos showing evolution of man with a humorous
twist has been well accepted. A survey conducted in February 2008, by Synovate
India ranked all advertisements on television on the basis of awareness and
brand recall. This Mentos commercial was ranked 2 nd overall with 90%
awareness and 96% brand recall and 86% on the ad reach index.

• Mentos has become one of the first products to use the internet to be a major
part of its campaign. This is in line with its cool youthful image and has launched
the whacky Mentos Helpline website which gives the users “expert” advice on
their life problems.

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• The Mentos Helpline has received considerable word of mouth publicity and has
received a boost from the blogging community which has been giving links to the
site.

• The TV advertisements have proved to be such a hit that they have received
considerable viral marketing from savvy internet users who post the links to the
Mentos videos on You Tube.
• The ads are now being reproduced in various languages with local actors for
markets across Asia and Europe

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 REFERENCES

1. http://www.foodnavigator.com/news/ng.asp?n=65256-food-for-britain-denmark-
ireland-consumption
2. http://www.marketingpractice.blogspot.com
3. http://icmrindia.org/Casestudies/catalogue/Marketing/MKTG190.htm
4. www.mentoshelpline.com
5. www.mentosfriendsline.com
6. www.perfettivanmelle.com
7. www.perfettivanmelle.in
8. www.ogilvyindia.com

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