Mai Dubai Case Study Example

Mai Dubai Water

Executive Summary

Mai Dubai is a bottle water company in the United Arab Emirates that provides water supply across the entire country. The brand is associated with high quality water and has won several accolades and awards. However, the company has not been able to effectively compete against the already established companies in the market, such as Al Ain and Masafa, which are the local companies that provide a similar service. This paper provides a marketing plan that covers all aspects in the market environment present in Abu Dhabi and investigates what the company should do to compete with other companies in the market. This paper looks at some of the important aspects in any marketing plan, including the external environment, pricing strategies, segmentation targeting and positioning in the market, as well as distribution strategies, communication strategies and consumer behavior. From the above analysis, a marketing plan can be formulated, so that the companies may effectively compete in the market.

Introduction

Mai Dubai is one of the bottle water companies in the United Arab Emirates that is under the authority of the Dubai Electricity and Water Authority (Sahoo, 2015). The company specialises in producing high quality bottled water and selling it to all consumers across the country. This is not the only company that specializes in the production of bottled water in the UAE. Other companies include Al Ain, Oasis, Masafi, which are all local based and the likes of Nestle, which is foreign owned (Sahoo, 2015). In total there are more than 50 companies that sell bottled water, though most of them are small companies (Sahoo, 2015). UAE is located in the sunny regions, and, therefore, there is a constant need for people to drink water. Since most people prefer the use of water coming from bottled companies instead of water from the taps, there is a ready market for the above product (Sahoo, 2015). The competition between the companies makes the case even more interesting, as all of the companies mentioned above and many others attempt to get a share of the current markets using all of the possible means within their power (Sahoo, 2015). This paper presents a marketing plan that is currently being utilized by Mai Dubai and shows some of the strategies that the company needs to improve to meet the demands of all the parties in the market.

External Environment Analysis

Demographic Environment

Mai Dubai water remains one of the main bottled water companies in the United Arab Emirates in UAE. Its market position is low, as compared to all of the other established water bottling companies. Mai Dubai, as a company, developed a brand in the United Arab Emirates and established a unique brand and packaging system that is readily identifiable with people from different demographic regions (Sahoo, 2015). The bottled water company is owned by DEWA (Dubai Electricity and Water Authority), which is solely owned by the state, though the company is registered as a limited liability corporation (Sahoo, 2015). The company has in the previous years managed to sell over 263 million bottles and cups of water to the population within the United Arab Emirates (Sahoo, 2015). Ideally, this is quite a high number for any company in the UAE. The company is focusing on producing 16 million units and hopes to expand their current production to 50 million by 2020 (Sahoo, 2015). This is because the current populace utilized the products from the above company. UAE is largely made up of Muslims with a huge number of tourists flocking on a yearly basis. All of these parties have accepted the fact that the use of bottled water is needed in the country.

Economic Environment

Many companies are increasing their budget in the coming financial years, so that they can compete effectively with the other parties present in the market. Currently, DEWA is expanding and plans to export bottled water. Currently, about 200 million units are produced on a yearly basis, and the company wants to increase the number of units to about 259 million units (Sahoo, 2015). This would ideally translate into more sales for the company. Also, the costs associated with making the desalinated water by Mai Dubai is cheaper, as compared to other areas, as water is piped from the desalinated pipes present in Dewa reservoir. The main competitors in the market likely to give Mai Dubai is Abu Dubai-based company, known as Agatha, which is located in Turkey and supplies bottled water to all parts, including those present in Dubai and the United Arab Emirates.

The company is also interested in establishing a new brand that is known as Al Aim in 2016 (Sahoo, 2015). This will effectively be a major source of competition for the company. Mai Dubai also serves to provide employment opportunities for people in Dubai and substantially contributes to the non-oil exports for a country, like UAE. It, therefore, plays a major role in the economy of Dubai (Sahoo, 2015). The government of the day has ensured that the external environment is stable for all business processes within and outside the country.

Cultural Environment

There are different cultures across Abu Dhabi, which intermingle on a daily basis. Cross cultural interactions are encouraged by the government of the day. Their way of life is nearly the same across the board. Abu Dhabi remains the home of largest plastic across the world. The society has, therefore, accepted the different packaging products in the market. Also, there are many companies in the market that sell and package their products in plastic items and have been ideally accepted by the society. The use of plastic products is allowed in the United Arab Emirates, and, therefore, Mai Dubai can use this platform in marketing their products (Sahoo, 2015).

Political Environment

The political environment in Abu Dhabi is stable and supportive of the efforts made by the companies, such as Mai Dubai. Since the company is state owned by a state corporation, its goals are in line with the economic goals of the state (Sahoo, 2015). Nonetheless, the government has been a sole supporter of the above company, meaning that the company’s marketing activities can be carried out in an effective manner (Sahoo, 2015).

Technological and Natural Environment

The technological environment has undergone numerous changes. Today, online marketing has become a key pillar for the company, as it seeks to increase its customer base. Orders for products in the company can be made through an online platform and shipped at the required venue (Sahoo, 2015). Customers can contact the company via social media platforms and their queries answered within the specific time frames. This is a shift from the past marketing firms that are solely based on the use of promotional events to market the company’s products (Sahoo, 2015). The natural environment has become more competitive than it was ever before, as new players enter the market to compete with the big fish at the same level. The best case would be the preservation of the sites, where Mai Dubai gets its water.

Competitor Analysis

Direct and Indirect Competitors

There are several competitors in the market who can readily be identified as the direct competitors to Mai Dubai. These competitors offer a similar service as Mai Dubai, which is to sell packaged water. The competitors include companies like Al Ain water, which is a subsidiary company of one of the food and beverage companies in Abu Dhabi. The other major competitors in the market include companies like Sana Mineral Water, Al Ghadeer Drinking Water, Awafi and Nestle Waters, just to mention a few (Sahoo, 2015). There are more than 50 companies producing bottled water to people across a variety of setting and to the localized environment present in Abu Dhabi.

Competitive Position and Objectives

The bottled water market remains very competitive and is classified in various classes. The segments include the bulk segment, premium and ultra-premium segment, as well as bottled mass water segments. There are a few multinational companies that are at the forefront. They include companies like Arwa (Coca-cola), Aquafina (PepsiCo) and Nestle Pure life (Nestle). Local companies, such as Al Ain, Masafi and Mai Dubai, are forced to compete with the above companies on an equal basis. The local companies have a strong dominance in the market, as compared to the multinational companies. Most products that are made in Abu Dhabi by the above companies are not imported but are filtered and produced locally. Oasis Blue Water has broken out in the market with a new product that is referred to as sparkling water that is dominating the market (Sahoo, 2015). Most of the foreign companies only come in when dealing with the premium forms of water. This segment is dominated by a company known as Evian. The table below shows the competitive analysis table regarding structures that are in place for all companies.

Competitive Analysis Table

Table 1. Competitive analysis of the different water bottled companies, as compared to Mai Dubai

When it comes to the competitive position and competitive objective in the current market, Mai Dubai lags behind among the major competitors in the market. The local companies Al Ain and Masafi have a larger market share, as compared to any local company with their current market shares being 38% and 23%, respectively (Sahoo, 2015). Mai Dubai has about 5% of the shares in the market and is still considered to be one of the smaller upcoming companies in the industry (Sahoo, 2015).

Competitive Strategy

Mai Dubai competitive strategy is based on the company producing water products that are of high quality. The quality brand has won the company accolades from all business segments and in the process has increased their customer base. Secondly, the company applies product differentiation when marketing its products (Sahoo, 2015). The company does not only deal with water selling but it also deals with the production and delivery of water equipment, such as water coolers. Mai Dubai always delivers most of its products to its consumers and has a loyal customer base.

Consumer Behavior

Needs Analysis

Abu Dhabi is located in a region that has a fairly warm climate region, meaning that it is likely to be an area with high-temperature levels. Ideally, such high temperatures would always create a feeling of people being thirsty and the need to drink bottled water. On the one hand, people have two choices when it comes to the type of water that they drink. They would either go for bottled water or tap water. Tap water contains many chemicals and sometimes is prone to contamination, since the water moves through pipes that could easily corrode and affect the quality of water (Doria, 2006). On the other hand, the different kinds of bottled water may contain the same chemicals as tap water but a thorough system that checks for the presence of any excess mineral is present. This system ensures that some of the harmful chemicals, such as fluoride that is associated with the browning of teeth are removed during the purification process. Ideally, this makes tap water to be of higher quality, as compared to the other forms of water that are commonly used. Since Mai Dubai is largely associated with the production of quality water and due to the brand name that the company has established over the years, the company bottled water is more likely to be bought by people across all settings. This does not just go to Mai Dubai alone, but also to all the other companies in the market that are producing bottled water of very high quality. Therefore, the consumer needs can be said to be utilitarian needs, since drinking of bottled water is associated with positive outcomes. In other words, it ensures that an individual does not get sick. It also ensures that there are no negative effects of drinking the water.

Decision Making Process Analysis

Since there are many products in the market, the decision-making process among the consumers is ideally driven by some factors. Some common factors taken into consideration by most consumers include aspects, such as the price of the water product, the mineral content, brand name and its quality status in the market. Consumers are more likely to go with bottled water products that are cheaper, since the price is a crucial factor that distinguishes the merchandises in the market (Wilk, 2006). Other customers are more likely to go for the brand name. In this case, these are considered as the loyal customers who have tested a specific product and understand its associated products. An example is the case of would be loyal customers for Mai Dubai water pricing the same product each time they need a water bottle. The lack of such a product necessitates choosing an alternative. In the above cases, there are three forms or types of decision-making processes that are normally involved. The first one is the extensive decision making, especially when the consumer wants to get the maximum benefits from the product. The second one is a limited decision-making process when the consumer has fewer choices that they could apply in their current market setting (Baker & Saren, 2016). In some cases, it involves the picking of the water product that is currently present in the market. The last decision-making process in the market is referred to as the routine decision-making process, where the consumer selects the product that they currently use on a daily basis.

External and internal variables may affect the choice of a consumer. One common external variable is the effect of other family members and friends on the purchase of specific products in the market (McDonald, 2016). For example, when an individual wants to purchase a bottled water product from a company like Al Ain and they are advised by their family members or friends to purchase Mai Dubai water products. The major external variable is normally associated with advice from a different party, while some internal variables may include purchasing a given product in the market, such as the bottled water basing on the amount that is readily available. Such decision factors of money present to buy a specific product and do not focus on other variables, such as quality of the products or the brand name of the company.

Segmentation Targeting and Positioning

Product Market

With today’s promotional marketing activities, bottled water products are sold in various places in the market. The most common place, where one would readily find a product belonging to a specific company is in wholesale shops and retailer units across the world. This are considered to be the main areas visited by a huge number of people, and, therefore, the presence of bottled water products from companies, such as Mai Dubai serve as a central point, where people can access the products. Today, products can be supplied to individual work settings and homes or in specific companies, where the use of a given product is required. Some have even gone ahead to sell the product in online platforms. As a result, there are three important new segments that have emerged in the above case. The first one is the wholesale market, where the products are found in bulk and places like supermarkets and other stalls. The second one is the retail market, which has more distribution units, as compared to the wholesale unit and the last segment deals with the online and personal orders directly from the company (Pike, 2015).

Market Segment

Online stores, as currently used by Mai Dubai, have proved to be quite effective and are gaining attention at alerted levels. Some consumers feel that it is better to directly order the product from the company or any online stores and get the product shipped directly to their doorstep. This is quite effective, especially if the product of interest is bulk or huge numbers and ineffective if a consumer needs a bottle of drinking water. It is also effective if the product under investigation is produced in huge quantities. For example, if a company or home orders 20 five liter bottles of water, the most appropriate method would be to directly bring them to their doorstep (Sahoo, 2015).

Positioning Strategy

The online market is growing at an alarming rate, and more consumers are becoming interested in relaxing at their homes and having their products delivered at their doorsteps in the shortest possible time. The system itself is security proof, and owners can pay through a variety of methods. The major issue is the development of a system that will address individuals who buy very few commodities online. The main objective of Mai Dubai going to the online platform is to exploit the opportunities that are not used by the current competitors in the market and develop a unique market that can sell their products across different markets (Tse, 2013). It is also a method of advertising the specific products being sold by the company. The company can position itself among parties that are utilizing the online platform to sell their products on the market. The company will also vouch for its quality success to market its product in the current market setting, so that it takes a substantial share of the market (Tse, 2013). This does not mean that the company will abandon its wholesaler and retailer activities but will serve to increase the market in which its products are readily available.

Product and Branding Strategy

Product Objective

There are several objectives in the marketing of the product. Marketing of the above product via the different platforms is aimed at increasing the company’s sales and, at the same time, building the brand awareness. Once more people in the market can identify with a given a product they are more likely to buy the product. The main aim of most of the marketing procedures is to develop and grow the market shares. Marketing also provides an opportunity for launching new products into the market. Marketing also seeks to target the new customers in the market. The main common form applied is through promotional activity (Hartley & Claycomb, 2013). Marketing of the products also serves as a new method of improving stakeholder relations and enhance customer relationships. The marketing of different products, in this case, bottled water will provide more information to consumers.

Product Mix

Product mix, commonly known as product assortment, refers to the number of products that are company offers to its consumers. In most cases, companies sell multiple product lines. In some instances, the products are similar, while, in some cases, the products are vastly different. There are four dimensions present in any product mix and they include depth, length, width and consistency. Width refers to the number of products that are to be sold in the market. If a company has two product lines, then the width is a mix. Product length refers to the number of a total number of products or items that are present in the product. In this case, Mai Dubai provides more than only one product in the market; it has specialized in the production of bottled water products in the market and water appliances. Some of the products have specific product lines. The bottled water product in the market is divided into different lines based on their sizes. In essence, the small sized products form a product line, while the large sized products from another product line. Consistency is associated with the way the products are closely related to other, especially regarding its use, distribution and production (Hartley & Claycomb, 2013). In this case, the company products, such as bottled water and the water appliances are closely related and are sometimes sold together.

A consumer product refers to the final product produced to the final consumer for the purpose of their personal consumption. Consumer products in the market are classified into different forms. They include convenience products, speciality products, and unsought products. Convenience products are commonly sold in the market more frequently and do not compare with any of the other products in the market. In this case, bottled water provides an example of a product that is frequently sold in the market and is, therefore, classified as a consumer product in the current market setting (Tse, 2013) (Baker & Saren, 2016). The current water products made by Mai Dubai are currently in the growth phase of the product lifecycle. Unlike many other companies, whose products have already reached the maturity state in the market, the water products made by Mai Dubai are still somehow stabilizing in the current market conditions. They are not predominantly known as other products made by other companies, such as Al Ain and Masafi. Nonetheless, sales of the product have been on the rise over the years, causing an increase in its manufacture capacity to meet the demands of the current market. This type of the product seems to have an effect on the product being produced in the market. Bottled water is a key commodity in the current market, since more people leave their houses without any form of water and, as a result, rely on this form of water to quench their thirst. Research and development units at Mai Dubai have continuously been on the forefront, attempting to improve the quality of the product made by the above company. A key distinguishing feature that separates bottled water coming from Mai Dubai is the use of the red brand that breaks away from the traditional blue branded products in the market.

Pricing Strategy

Pricing Objective

Since most of the bottled water products have different lines, their prices tend to differ, based on the size of the product. The price of 1.5 liters in a dozen packed bottle is AED 18, the price of 5L is 12 AED, and the price of 500ml is in 24 pack is AED 18 (Sahoo, 2015). The above prices are based on the different sizes of the various bottled products and the mode of packing. The company’s pricing strategy is based on cost pricing, whereby the prices range from the ceiling to the floor. This way the prices can be changed, based on the current market condition. Moreover, during the year, there are periods in which the demand for the above-bottled water products is quite high and, therefore, the company is forced to increase the price in meeting the demands of the people (Baker & Saren, 2016; McDonald, 2016). In other cases, the company is forced to reduce the cost of the product, especially if when the demand by the populace is quite low. Cost pricing allows the company to change its prices based on the current market conditions and in the process allow the company to market their products during different periods of the years, as well as establish a customer base that relies on the use of the specific products mentioned above.

Demand and Price Sensitivity

Price and demand have an inverse relationship. The higher the price of certain products within the current market segment is, the lower is the demand by all interested parties. If Mai Dubai raises the price of different products in the market, most consumers will be unable to buy their products in the market, and, as a result, the demand for the product will reduce. It is, therefore, necessary that the company places specific steps that ensure that their products are within the equilibrium range of the demand and the supply curve, so that the effect of the inverse relationship does not affect the company marketing strategies, especially as it relates to the pricing strategy (Baker & Saren, 2016; McDonald, 2016).

Product Pricing Strategies

There are various product pricing strategies that could be used in the current market. The first is premium pricing, where the quality of the product becomes the main determinant of price. In this case, the company must show why there is value for the above product. In the case of Mai Dubai, its product is already ranked as one with the highest quality. This is the perfect reason that can justify the high price on the specific products. The company must maintain this value for consumers to choose to use the product. The other strategy includes price skimming and economical pricing.

Product Mixed Strategies and Price Adjustment Strategies

The product mix strategies to be used in the case of Mai Dubai include cost-based strategies, skimming, competitive based strategies, and penetration, while the company can utilise different price adjustment pricing methods, including the use of discounts and allowance, psychological pricing, promotional pricing, geographical pricing, segmented, international and dynamic pricing (Baker & Saren, 2016; Hartley & Claycomb, 2013; McDonald, 2016; Tse, 2013).

Marketing Communication Strategy

Market Communication Objective and Promotion Mix

There are various marketing communication strategies that could be used by the company in gaining the upper hand in the current marketing setting. For the marketing approach to be operative, the company needs to come up with a dynamic team that will implement all the communication strategy to the latter. Therefore, the management of the company is supposed to play a critical role in ensuring that the current marketing strategy being enforced has the potential to bring the required changes in the current organizational setting (Baker & Saren, 2016; Hartley & Claycomb, 2013; McDonald, 2016; Tse, 2013). Some of the effective strategies that could be applied by the above company include sales promotion and sponsorship, personal selling and public relations. The above method of marketing will ensure that a wider population is covered and more products belonging to the company are sold to consumers.

Effective Communication in Marketing

The six steps of effective communication will be used in the above case to promote each of the following marketing strategies. All marketers within the company will be required to speak clearly, so that the consumer can understand the specific message being passed by the party. Marketers will be required to use a language that is easily comprehensible to the populace and avoids the use of jargon and acronyms. The body posture always plays a key role in communication even before an individual starts speaking. Marketers will not be expected to be in the wrong posture, while speaking to the members of the public. Controlling their facial expressions will also be paramount, especially in cases where consumers seem to be more aggressive (Hartley & Claycomb, 2013). A moderate tempo should also be used when speaking to the members of the public, so that they can at least comprehend the message being passed in the current setting. Marketers will be expected to consider the audience they are currently dealing with before marketing the company’s product. If the audience is made up of formal young people, the appropriate language should be used in the above case. The language used will differ if the audience consists of old people. The mode of communication to be used in the above case is supposed to be quite clear and quite effective. Lastly, a wrap up should be given to summarize the key points.

Distribution Channel

Distribution Objective

The distribution channel to be used will be comprised of some distributors present in a supply chain manner. The distributors and suppliers within the system will ensure that the products reach the market at the required time. Most products would directly go to the wholesale unit or retain units, while other will be shipped off using the online system. The above system is direct, since it involves the picking of the products from the company’s headquarters and sending them directly to parties that will sell the products to the consumers in the market. Ideally, the wholesale and retail units will buy the products from the mentioned parties and then sell them at a profit in the process earning the profits (Hartley & Claycomb, 2013). The system works under a vertical system, where the manufacturers, producers and retailers all work together. While this arrangement is operative, it is prone to some issues, including the issues associated with an oligopoly, lack of coordination reduced service in the production service to ensure that the other sides have completely transferred all the products (Hartley & Claycomb, 2013).

Conclusion

Mai Dubai remains one of the largest companies in the UAE that specialises in the sale of bottled water. The company’s market share is still low, as there are major competitors who already dominate the above market. For the company to perform effectively on the same level with other players, it needs to institute agent measures that are aimed at increasing their marketing skills. It also needs to address the differences in competition with the other players in the market. The company can bank on its high quality of products to attract new customers into the market. This, in itself, is already a brand that could be utilized by the company in attracting more people to join its cause.