BPMM 6013 MARKETING MANAGEMENT

CASE STUDY 1
BABY DREAMS: PRICING FOR THE PRODUCTS
AND APPEAL

PREPARED BY: LEELA SAAI SUBRAMANIAM (827190)

LECTURER: DR PUJAWATI MD SAID
Table of Contents

BABY DREAMS: PRICING FOR THE PRODUCTS AND APPEAL...........................................1

Background of Baby Dreams..........................................................................................................2

Purpose of the case study...............................................................................................................2

Problem statement.........................................................................................................................2

Confusion appearing on the previous method/strategy used by the company................................2

Product..........................................................................................................................................2

Target Market................................................................................................................................2

Marketing Strategy used in the business (base on promotion, price, and delivery)........................2

Customers choice of purchasing’s.................................................................................................3

Challenges face by Nora................................................................................................................3

Strategy Solutions base on the case study......................................................................................3

Problem Identification....................................................................................................................3

Alternatives / Choices of Solutions.................................................................................................4

Criteria of High Competitors..........................................................................................................4

Analysis used for case study: Baby Dreams...................................................................................5

Competitive Analysis....................................................................................................................5

Customer Segmentation and Target Market Analysis....................................................................8

SWOT Analysis.............................................................................................................................9

Decisions.........................................................................................................................................11

Implementations............................................................................................................................11

1
BABY DREAMS: PRICING FOR THE PRODUCTS AND APPEAL

Background of Baby Dreams

BABY DREAMS – Started in 2009 – Taman Chempaka, Johor Bharu

Nora Farooq is the daughter of Mr.Farooq, the founder and owner of Baby Dreams and were
asked the daughter to took care of the business since he is not well. The strategy of the
business to grow rapidly is the low-price strategy which attracted the customers easily. They
have opened 2 new outlets resulting the growing of the business until they find it difficult to
compete with the competitors, they have to closed down first 2 outlets because of running
capital.

Purpose of the case study

Finding a good strategy and solution to sustain the business

To Expand the business as a one stop Centre

Problem statement
1) Is the low-price strategy being good for the business set up?
2) What are the factors that should be considered for workable pricing strategy?
3) Introducing the product bundle pricing, captive product pricing or product line pricing
can retain the business?
4) Can online business and sales help the business to recover?

Confusion appearing on the previous method/strategy used by the company

1) Is the low-price strategy not working well?
2) Should I change my focus from penetrating the market to offer prestigious goods?
3) Should I go for click and brick? – Online Business

Product
 Sell Baby Products and children clothing’s up to 7 years old children

Target Market
 New parents between early 20’s – late 30’s who usually anticipating first baby
 Low- middle income group customers

2
Marketing Strategy used in the business (base on promotion, price, and delivery)
 Low price segment of the market – used to boom the business and expanded the
business
 Discount policy- increased in sales- help to retain her customers
 Voucher strategy- believe to increase in short term sales but the strategy did not work
well in her business

Customers choice of purchasing’s

 Low Price
 Standard, quality, sophistication, and styles – exposure thru international trends via
internet and travelling overseas
 Imported Brands

Challenges face by Nora

 Price range base on customer class (lower, middle, upper)
 Wide Competitors (MNC Company like Johnson & johnson, Mothercare), Sole
Individual Companies under big malls and shippong complex (Pasarayaku, Honey
Bee, Damia, Baby Dreams) and Local companies (carrie, anakku, pureen)

Strategy Solutions base on the case study

 Since Nora’s shop based on the lower- middle income earners, she has to work on the
price competitions
 Online Business – convenience, easily reachable

Problem Identification
1) High Competitors- Baby dreams operate at Taman Chempaka Johor Bharu and later after
3 years they launched another 2 more outlets but due to stiff competitions, they have to
close the outlets
- Competitors of Baby Dreams are mainly divided into two which operates as corporate
company and sole ownership. Corporate companies are divided into two which are
multinational company like (MotherCare, Johnsons) and local companies (Carrie,
Anakku, Pureen and Fiffy) whereas sole ownership company own by individual company
like Pasarayaku, Baby Bee, Damia and Baby Dreams itself.
2) Customers classification – there is three type of customers for baby products which is
upper class, middle class, and low class. These classes play major role in customer

3
 segmentations for Baby Dreams. The upper middle class to upper class segments is less
price sensitive and more concentrates on their baby’s comfortability whereas low segment
customers more in focus to the pricings. Baby Dream located area in lower – middle
income class customers which more relatedly focus on less pricings than quality and
brand.
3) Poor Marketing – Baby Dreams marketing strategy works on promotion, price, and
delivery. They provide discounts, vouchers, and best value to attract the customers. This
strategy makes Baby Dreams to get attention and capture the market easily.
4) Financial problem – Baby Dreams had to shut down the other two outlets due to
insufficient running capital. Nora’s mission to expand the business as one step center and
to ambience the outlet to look more attractive. To support her mission and expand the
business, finance is being one of the major problems and lending money from the bank is
not the option for her to expand the business.

Alternatives / Choices of Solutions

1) Start Online Business – easy and can reach customer faster- no rental cost

Baby Dreams business mainly for low – middle income people and normally customer
from this category will go for online platforms finding for affordable and quality type of
product.

2) Can consider market the products for other earners like middle – high earners

Baby Dreams can consider having products based on middle-high income earners but for
this baby dreams should financially stable and must compete with other branded
competitors like Johnson&Johnson, Anakku and ext.

3) Consider moving the market or start at new area

Baby Dreams can move to other area’s where middle-low incomers are located. They can
consider area’s with necessities are provided and easily track their shop.
4) Baby Dreams can consider supplying to outlets like speed99, and KK mart which all
middle-income earners and low earners will go for shop necessity- can also consider
selling in night markets- easy and convenient for the customers to shop
5) Consider using technics like giving gifts and ext to attract more customer

4
 Discounts and vouchers are so mainstream, Baby Dreams can use techniques like sending
gifts and baby bouquets for customers like hampers, presents and other attractive
techniques.

Criteria of High Competitors

1) Capital

Baby Dreams Competitors are from corporate companies and sole ownership companies
which have already market and advertise world widely, their capital and financial are
strong enough for the business to develop and plan strategically.

2) Target Markets (Customers)

Baby Dreams competitors have customers from low to high class, their customers are
diversified as the price are affordable and easy to purchase. Since they financial are
sufficient for marketing, they have spread their wings all over the place and everyone
knows about their product.

3) Strategic Locations

Baby Dreams competitors Johnson&Johnson, Mothercare, Pureen and ext, their

marketing’s and strategic location are marts, consumer retailers like 7 elevens and speed
99’s, shopping complex and ext. Easily attract customers place and mostly can get
anywhere nearer to customers.

5
Analysis used for case study: Baby Dreams
Competitive Analysis
Competitive analysis is a strategy to identify the major competitors and research about their
business products and marketing strategies. Thru this study, Baby dreams cab crate a solid
business strategy to improve and plan strategies to keep competing among the other
competitors in the industry. Below table are the competitive analysis of Baby Dreams:

Baby Dreams have two different categorized competitors which are corporate
company and sole ownership company. Corporate company are divided into two which are
multinational companies (Motehrcare and Johnson&Johnson) and local companies like
Carrie, Anakku, Pureen and Fiffy. While sole ownership companies are individual companies
with own products and brand like Pasaraku, Honeybee, Damia and Baby Dreams.

Most of the supermarkets like Giants, Tesco, Billion, Store offers combination
products of multinational and local brands. Sole ownership outlets also sell combination
products and own brand products under their manufacturing and name. Same goes to Baby
Dreams, they also focused on combination products of infant and children’s wear, toys,
postnatal care, baby gifts.

Mothercare and Johnson&Johnson under multinational company are the main competitor in
the market for baby products and other wide range product types like maternity essentials,
baby clothes and children fashions. Johnson& Johnson products not only for babies and
mommies, but their product category is also wide from households and medications, facial
wash, and contact lenses. Their business in this industry are very well known from all
categorized customer from low to high class. Their weaknesses are many players in this
industry therefore their profit and margin share will be limited. Other than that, their new
product launching depends success on the existing products, new products doesn’t reach
customer easily unless the customers are in need to buy they product and they will notice the
new brand or product in the market.

Local companies give tough competition in the industry, well branded same goes like
MNC companies. Their marketing is success and convincing for the customers, easily reach
out as their products can found easily in shopping malls, marts, and other retailing stores.
They have limited sole shops and their target customers are those who visits malls and
retailing stores. Marketing strategy used by these companies are purple colour baby elephant
and carrie junior song by Carrie company which easily attracts mommies and kids,

6
membership benefits and points collection and redemption program by Anakku, events,
competition, and promotion by Fiffy.

Sole ownership companies like Pasarayaku and Damia, they wont really focused on
baby products as they are having big retail stores and marts, their products are variety and
baby products are one of the segments. Honeybee focus on baby products like dresses but
they also do not focus on accessories and other sub products that needs like postnatal care.
This is a big opportunity for Baby Dream to spread it’s wings and plan on the marketing
strategy as this company can solely focus on baby products, accessories, clothes and postnatal
care all in needs in a category of babies and mommies.

COMPETITORS STRENGTHS WEAKNESSES

CORPORATE COMPANIES
MULTINATIONAL COMPANY 1) MOTHERCARE MOTHERCARE & JOHNSONS
 MOTHERCARE  MNC COMPANY  MANY PLAYERS IN THIS
 JOHNSON&JOHNSON  50 YEARS EXPERIENCE SEGMENTS MEANS LIMITED
 PRODUCTS: BABY RELATED SHARE AND MARGIN
PRODUCTS, RANGING FROM  DEPENDENCE OF SUCCESS UPON
STROLLERS TO CARRIERS, TO LAUNCH NEW PRODUCT
MATERNITY ESSENTIALS, BABY  MANY NEW LAUNCH PRODUCTS
CLOTHES AND CHILDREN ARE VULNERABLE TO THE
FASHION UNCERTAINITY OF
 PROVIDES WEALTH OF REGULARTORY REVIEW,
PARENTING AND OREGNANCY RELIANCE ON SMALL MOLECULE
ADVICE DRUG – SMALL MOLECULE IS
 BRAND SUCCESS PRODUCT MORE IMPACTED OF GENERIC
2) JOHNSON&JOHNSON COMPETITION
 AMERICAN MNC COMPANY
 BRAND INCLUDE NUMEROUS
HOUSEHOLD NAMES OF
MEDICATION AND FIRST AID
SUPPLIES
 WELL KNOWN CONSUMER
PRODUCTS THE BAND-AID
BRAND LINE OF BANDAGES,
TYLENOL MEDICATIONS,
JOHNSON BABY PRODUCTS,
NEUTROGENIA SKIN AND
BEAUTY PRODUCTS, CLEAN &
CLEAR FACIAL WASH AND
ACUVUE CONTACT LENS
LOCAL COMPANIES CAN FIND THEIR PRODUCTS IN BIG  LIMITED SOLE SHOPS WITH OWN
 CARRIE MAKTES LIKE GIANTS, TESCO’S, AEON, BRAND AND ALWAYS MARKET
 ANAKKU AND EXT THEIR PRODUCTIONS IN BIG
MARKET AND SHOPPING
 PUREEN
CUSTOMER EASILY FINDS PRODUCT COMPLEX
 FIFFY IN RETAIL SHOPS AND BIG MARTS

1) CARRIE
 IN MARKET FOR ALMOST 20
YEARS
 LEADING BABY AND KID SPECIFIC
PERSONAL CARE
 PRODUCT: HYEGENE CHILDREN
TOILETERIES

7
  SONG AND CARRIE JUNIOR
ELEPHANT ATTRACT KIDS AND
MOMMIES EASILY
2) ANAKKU
 STRATEGIC LOCATION: KLANG
 AROUND 128 STORES IN
MALAYSIA
 OFFERS: MEMBERSIP BENEFITS
TO CUSTOMER WITH POINTS
COLLECTION AND REDEMPTION
PROGRAM
 RECEIVE CUSTOMER REEDBACK
AND RESPONSES
3) PUREEN
 HQ: PETALING JAYA AND KUALA
LUMPUR
 5 OTHER BRANCHES IN
BUTTERWORTH, JB, IPOH, KOTA
KINABALU & KUCHING
 HAVE OWN LABORATORY FOR
RESEARCH & DEVLOPMENT AT
USA
4) FIFFY
 RECEIVED 4 DISTIMGUISH
AWARDS
 TARGET CUSTOMERS:
PREGNANT MOTHERS TO
TODDLERS AND CHILDREN UNTIL
7 YEARS
 MARKETING STRATEGY:
ATTRACT CUSTOMER THROUGH
VARIENTY EVENTS,
COMPETITONA AND
PROMOTIONAL EFFORTS

SOLE OWNERSHIP (INDIVIDUAL PRODUCT: OFFER COMBINATION OF CUSTOMER WILL GO FOR

COMPANIES) MULTINATIONAL BRANDS AND LOCAL BRANDED PRODUCTS FIRST
 PASARAYAKU BRANDS- MORE VARIETY CHOICES BEFORE CONSIDERING THESE
1) PASARAYAKU
 HONEYBEE PRODUCTS
 HQ: PERAK (INDUSTRIAL AREA)
 DAMIA  COMBINATION PRODUCTS AND
1) PASARAYAKU
 BABY DREAMS SECTIONS
MIX PRODUCT AND BRANDS
 OFFER: MEMBERSHIP CARD TO 2) HONEYBEE
REGULAR CUSTOMER NO OFFERING ACCESSORIES AND
2) HONEYBEE CARE FOR BABIES AND MOTHERS
 HQ: MART, KEMPAS POSTNATAL CARE
 PRODUCTS: DRESSES FOR 3) DAMIA
NEWBORN AND CHILDREN UP HQ: MART, KEMPAS (JOINT
TO 7 YEARS VENTURE WITH OTHER BRANDS
3) DAMIA AND PRODUCTS)
 OFFER STOCK CLEARANCE
 MAIN PRODUCTS: LADIES
BEFORE FESTIVALS
WEAR AND ACCESSORIES
(BABY PRODUCTS AND
CHOLDREN WEAR ARE ONLY
SIDE PRODUCTS)

8
Customer Segmentation and Target Market Analysis
Customer segmentation will help Baby Dreams to study about the common characters of their
customers and how to market effectively based on each group (Demographic, Geographic,
Behavioral, psychographic).

DEMOGRAPHIC
DEMOGRAPHIC GENDER:
GENDER: PREGNANT
PREGNANT WOMENS
WOMENS
AGE
AGE GAP:
GAP: EARLY
EARLY 20’S
20’S TO
TO LATE
LATE 30’S
30’S
OCCUPATION:
OCCUPATION: PREGNANT
PREGNANT LADIES
LADIES (WORKING
(WORKING OR OR HOUSEWIFE)
HOUSEWIFE)
GEOGRAPHIC
GEOGRAPHIC LOCATION:
LOCATION: TAMAN
TAMAN CHEMPAKA
CHEMPAKA
REGION:
REGION: JOHOR
JOHOR BHARU
BHARU
BEHAVIORAL
BEHAVIORAL SPENDING:
SPENDING: LESS
LESS PRICE
PRICE PRODUCTS
PRODUCTS
CONSUMPTION
CONSUMPTION HABIT:
HABIT: BEFORE
BEFORE ANDAND AFTER
AFTER PREGNANCY
PREGNANCY (ESTIMATE
(ESTIMATE 5-
5-
10
10 YEARS)
YEARS)
PRODUCT
PRODUCT & & SERVICE
SERVICE USAGE:
USAGE: BABY
BABY AND
AND CHIDREN
CHIDREN WEAR,
WEAR, TOYS,
TOYS,
POSTNATAL
POSTNATAL CARE,
CARE, BABY
BABY GIFTS
GIFTS AND
AND EXT.
EXT.
PSYCHOLOGICAL
PSYCHOLOGICAL LIFESTYLE:
LIFESTYLE: LOW-MIDDLE
LOW-MIDDLE CLASS
CLASS
PERSONALITY:
PERSONALITY: LIKES
LIKES ATTRACTIVE
ATTRACTIVE PRICES
PRICES LIKE
LIKE AFTER
AFTER DISCOUNTS
DISCOUNTS AND
AND
VOUCHERS
VOUCHERS
CHARACTERISTICS:
CHARACTERISTICS: LESS
LESS PRICE
PRICE // BUDGET
BUDGET PRICE
PRICE // AFFORDABLE
AFFORDABLE PRICE
PRICE

1) Behavioral
- Baby Dreams products are from newborn babies to seven year old children, their target
market are new parents between early 20’s to late 30’s who anticipating for first babies as
for their other babies, they can re-use the products.
- The product usage is expected to stay long for 2-3 years and most of the products are for
low-middle class incomers which like to buy for affordable price with good quality.
- The product purchases mostly before delivery and after delivery- their loyalty stays based
on the amount of their baby planning and can say estimate for 5 years after the baby born.
- Baby Dreams can also plan for long term products like multivitamins and other
medications that can help children and parents healthy – focus on long term products
more than 5 years
2) Psychological
- Baby Dreams are focusing on low-middle incomers as their products are based specially
for them as it is affordable, and their discounts are easily attracted by customers.
- Baby Dreams can usual strategy “discount policy” help Baby Dream’s customer to retain
and use the voucher strategy as well to increase the short-term sales.
- Baby Dreams can use sweet colors to attract mommies and children like light purple,
blue, pink and ext. Colors and cartoons can pull customers easily as it is related to babies
and children
- Baby Dreams can extend and market thru social responsibility programs which will easily
reach people and promote their product and outlet as well

9
SWOT Analysis
SWOT analysis is to identify and evaluate company’s strength, weaknesses, opportunities,
and threats. The objective of this analysis is to help the company to develop awareness and
find for other opportunities and work on the weaknesses to compete equally with other
competitors.

STRENGTH WEAKNESS
* LOW PRICE *MORE CAPITAL NEEDED TO RUN OUTLETS
*DISCOUNT POLICY *LESS EMPLOYEES
*NEAR TO HOUSING AREA – EASY DELIVERY *NO MARKETING STRATEGY
*LIMITED CUSTOMERS TARGETING ONE
AREA ONLY
OPPURTUNITY THREAT
*ONLINE BUSINESS – E-COMMERCE *HIGH COMPETITORS
(TECHNOLOGY)

Strength

Baby Dream’s strength is the price is affordable, just nice for incomers from low to middle
class. They also provide discount policy and voucher strategy to pull customers. Baby Dream
shop situated near to housing area at Taman Chempaka, easy for the customers to purchase
baby products as it is nearby to home and can get easily.

Weaknesses

One of the most important weaknesses of Baby Dreams are financial as because if high
competitors and insufficient of capital, Baby Dream closed 2 outlets due to insufficient
capitals. Less employees works with Baby Dreams so all the arranging, planning, marketing,
and everything are from one man show. There is no marketing strategy applied, and no
specific team works on the marketing for Baby Dreams. Since Baby Dreams currently only
focusing Taman Chempaka, Baby Dreams should consider moving to a wider range area
focus on new market area and segments.

Opportunities

Technology and internet platforms in the name of e-commerce are being current business
platform. E-commerce are easy with no rental cost and easy advertising to customer. Funnels

10
like Lazada, Zalora, E-Bay been a remarkably busy tool for sellers and customers. Social
media attracts customer easily being an online customer service and advertise the product
easily. Baby Dreams can use e-commerce to develop business with low cost and faster
reachable compare to other advertising media with less employees and easy communications.

Threat

High competitors in the industry is the biggest threat for Baby Dreams as their marketing and
products are successfully reachable to customer. Their products easily sell because customer
can find the products in almost all the retail and marts.

Decisions
From all the analysis discussed earlier, one of the best analysis that can take up is the SWOT
analysis. As Baby Dreams weak points less employees workforces, heavy competitions with
other big competitors, customers classifications as low, high and middle class, no proper
marketing strategy applied and finally less capital to develop the outlets, Baby Dreams can
work more on the opportunities which can summarizes and overcome all the weaknesses
easily through technology and online platforms as e-commerce.

Technology development and E-commerce is a good opportunity for Baby Dreams to

expand the business virtually which everything now can almost be done by internet. From
buying groceries, buy necessities, clothes, accessories, and perfumes until rent a house can be
done thru internet and e-commerce. Baby Dreams can work starting a e-commerce business
with much more lesser employees and without renting outlets or business which will cost
higher. Finance and capital will not be an issue anymore as they do not need to pay more
while they can plan for online marketing strategy that connects people all over the world.
Competing with the other big MNC competitors, Baby Dreams can have wider customer
segmentations without any class differentiation.

Implementations
E-commerce is a business platform through internet that connects with customers easily and
advertise globally. Firms and Individuals buy and sell things over internet and it operates all
time with no time restrictions. It works as business-business and business-consumer.

E-commerce can be done two ways through social media and funnels or business
platforms. Baby Dream can try to sell online through social media’s first before moving to
funnels (website builder). Current trends Instagram and Facebook also have business page,

11
Baby Dreams can create business page through Instagram and Facebook build its own
customers first. Baby Dreams can also advertise the products and promotions through this
social media for minimum cost and reach customers amazingly fast. Customers can get in
touch through Instagram messenger and Facebook messenger or WhatsApp personally
through all the contact details given in the business profile. The self-customer service through
social media is amazingly effective because the communication is one to one and Baby
Dreams can improvise through the feedback given very easily. Vouchers and discounts are
applicable through social media and extremely fast spreading to the customers.

Secondly, e-commerce is applicable through online business platforms like

LAZADA, E-Bay, Alibaba Websites, Zalora and ext. Baby Dreams can create online
platforms as supplier and post the products in the websites which customers can easily search
and find for the products easily. Baby Dreams will have to compete with a lot of competitors
as a lot of normal customers can act as seller as well and seller can be a customer through
online selling and buying but Baby Dreams can create a private official page in the Lazada
Platform itself where the products, promotions and discounts can easily list down under the
page and customer will get first notification from Baby Dreams when they post their
products.

Thirdly, Baby Dreams can create own website page and promote their products and
services through the websites. This website will represent the outlet itself thus the appearance
of the website should be unique and should design same as the outlet theme. When the
business advertises and spread easily through online, customers will find for the official
website which will look professional for the online business. Customer can easily get
information about the products and its description, thru this Baby Dreams will create trust
and convenient relationship with customer. Other than that, Baby Dreams can share news,
programs involved and customer service chat on the website itself along with the delivery
tracking for online purchases and delivery.

E-commerce is the trend for the business development and nowadays customer prefer
to shop online which save travelling cost and time for them. Business can also save a lot of
cost like rental, manpower, utilities, and ext. Selling and buying online is convenient with the
a lot of transportation and verdors working together like Ninja Express, J&T Transportation,
Pos Laju, customers parcel can reach fast within 1-3 days with this deliveries.

12
13