James Boag Marketing Report

crowd Boag Premium What would you like to drink today? strategic commercializeing Planning MBA 9006 commercialiseing Semester 1, 2008 Table Of Contents rogue Executive Summary3 The beer food grocery4 Market dish egress5 Financial overview5 Strategic Gap7 Strategic aligning8 Product Life cycles/second8 Boston Consulting Group and GE/McKinsey Matrix9 Competitive Advantage10 Ansoff Product Market Mix11 commercializeing Strategy12 Target Market12 Brand Positioning13 Product Strategy15 determine Strategy15Distri saveion Strategy16 Integrated selling Communication Strategy17 Advertising17 Sponsorship17 Point of Purchase and Packaging17 Promotion17 Public Relations18 Marketing cipher18 Implementation18 Evaluation and control19 Conclusion20 Appendices21-36 Executive Summary Beer gross sales in Australia hurl been showing a downward trend, with the exception of the aid beer subdivision which has shown a strong process of 9% annually. The crowd Boag tri only ife beer has established itself as the 2 grass of pension beer in Australia.Building on our strategic acquisition of James Boag we hope to continue increasing our market parcel of this growing tribute beer segment by exploiting and building but on James Boag smirch equity. In 2007, 78% of our sales revenue was generated from beer, thus protecting this segment becomes crucially important for us to verify our financial profits. Beer sales revenue has been growing at 5% pa for the previous courses. With the affixd drive on merchandising for the James Boag smirch we hope to capture a healthy sh ar of the growing premium beer segment and likewise nhance this growth to 6% pa for the calculateed periods of 2008-2010. As the premium beer segment is in a growth phase, James Boag premium beer is strategically placed as a Star. Increased investments towards building the brand and increasing market penet balancen would help generate greater financial profits. However this strategy would req uire an increase in merchandising expenditures to the tuneA$54 million in 2008, a rise of 10% pa compared to the previous average of 2%pa. This increase in expenditure would allow us increase our total market share of James Boag premium beer to 18% from its present 9%.This Strategic marketing jut out proposes a strategy to not only meet financial objectives, but also to reinforce, and increase brand awareness. Capturing market share by high glistening divergentiated measure out, as against devaluing our price, would be the main way of our growth strategy. The new ingathering development of the James Boag premium scintillation would help capture the growing female beer patron segment. Introduction of Casks and Draught beers at pubs and restaurants would further strengthen the availability, market share and brand image of our range.For our James Boag range we would introduce specially brocaded serving glasses, characteristic packaging, associating the range with early(a) prem ium luxury bands, targeting incarnate events and membership boxes at premium sport events, would be some of the key strategies. In terms of pricing, we would like to maintain our present price of A$50 per case, in army to communicate the premium status, and also indicate the price measure relation backship of our brand. This plan also exhibits a staggered implementation, evaluation and control plan for our organization over the periods 2008-2010.Success of the implementation would be closed monitor lizarded by clearly defined per phaseance indicators. The beer market The beer market has lost some its share to wines and other healthier alternatives. However, though the beer market in general is declining in share, the premium beer market has shown an increase in its share value since 2002 till present. selective information monitor 2006 ( addition A establish 1) Beer in Australia gives the total value of the beer market segment in Australia at $3,939 million AUD.The growth of t he total beer market has been near 2% for the past 5 years, and the premium beer segment makes about 21% of this market share. The premium beer segment is poised to grow at around 10% per annum and in the past year itself the growth of the premium beer has been at 9. 1% by volume. (Appendix A Exhibit 2) The table below shows the forecasted growth in value for the beer market in total and the relative growth of the premium beer segment for years 2008-10. Beer market forecast 2008 2009 2010 gist value in AUD/millions 4,151 4,234 4,319 Premium beer value in AUD/millions 1,411 1,736 2,073 Lion Nathan has generated 78% of their total sales revenue from beers.This revenue could be threatened by the downward sales trend of the beer market in general. Thus cashing in on the upward trend of premiumisation would be key to the maintenance and growth of the company for the near future. In 2007 majority revenue for the year was generated due to the Power brands, which are Tooheys extra dr y, thirty gold, Hahn super dry, and international premium brands like Heineken and Becks. Hahn super dry and International premium brands grew by 18% last year, with Heineken being in the forefront. 1 These power brands can be further divided into the High premium brands like Heineken and Becks and lower premium brands like XXX Gold and Tooheys . The strategic acquisition of James Boag breweries in Nov 2007 has further enhanced the high premium beer range with the addition of the James Boag premium collection. Market share Lion-Nathan Ltd has 35-39% beer market share by volume. While its main competitor Fosters Ltd has been enjoying a market share of 50%. In this duopoly market structure other small breweries comprise of the remaining 10-15% of the market. Appendix A Exhibit 3). With the shrinking beer market in general, we estimate that the growing premium beer segment shall be the some competitive arena for beer marketing in the near future. With the goal of greater return to the shareholders, and with the vision to become 1 beverage company in Australia, Lion-Nathan Ltd shall have to focus all its strengths in the fight for this growing beer segment. Financial overview Du-Pont analysis of Lion-Nathan Ltd reveals an asset efficiently ratio of 0. 07 for 2002 to 2005 and there was a sudden surge to 0. 0 in 2006 due to the sale of non performing assets by the company (Appendix B Exhibit 1). Closer the ratio towards 1 signifies better returns to shareholders. For the period of 2008-10 we forecast that this ratio of 0. 3 would be maintained and further improved by increasing sales revenue and greater market share capture. Marketing and advertisement expenditures are forecasted at 10% increment per annum, an increase of 8% from the previous average, this increase is in line with the proposed marketing strategies.The sales revenue of Lion-Nathan Ltd for 2002-2007 has been growing between 4-5% per year. join our efforts on the growing premium beer market segment we estimate that sales revenue growth for 2008-2010 would be at 6% per annum. pic 2003 Existing Market Market James Boag Premium Beer New Product Development James Boag premium light shrewdness beer New markets Market Female drinkers Casks and Draught Beers Development wellness conscious consumers Diversification Using the Ansoff matrix above, the pursuit marketing strategy requirement can be identified for James Boag brand Market Penetration To increase and maintain sales of existing proceedss Increase brand indite and strategically link James Boag premium beer with other James Boag products to ensure and increase market penetration. Explore and build on existing routes to market and strengthen existing relationship with both on-trade and off-trade distribution networks Due to increasing consumer preference for eat out and travelling, there is potential to increase sales by targeted marketing at specific areas. Market Development Capitalise on female preferences to favour for premium beer when having one. Develop strategies to tap into the overseas market New Product Development The Australian beer market is seeing an increasing trend towards consumption of premium beers. to a fault as the consumers is becoming more health conscious, through development of James Boag premium light, it would enable us to fulfil both the criteria of an otherwise spot consumer.Diversification James Boag till now has been limited by its geographic location and thus has concentrated on mark bottled beers as means of distribution, but now building on distributive strengths of Lion Nathan it should broaden its distribution to include casks and draught beers thus allowing the brand to reinforce its image of quality, taste and freshness. Marketing Strategy The above analysis would suggest the pursuance strategic implication for James Boag premium Beer. (Appendix C Exhibit 3) ? Protect Market share and defy loyal costumers Stress brand differentiati on to attract and also wean away customers of competitor product. ? Re dress brand if necessary to achieve dominant position ? Emphasize product quality ? Identify and exploit growth segments ? Increase distribution ? Maintain profit marge Target Market Situational analysis shows that probatory amount of premium beer buyers fall under 25-45 years age predominantly male, educated with high disposable income and status conscious. The buying preference is dependent on occasions and situation.However, there is not much brand loyalty. Males prefer to have premium beer on occasion like after work drinks, when entertaining guests or business associates in restaurants and corporate events. Choice of the premium beer usually depends upon the image the brand personifies and availability and they are more likely to pay more for perceptible quality attributes they associate with particular brands . Females though in minority are slowly gravitating towards beer drinking and usually prefer to have one in interchangeable occasions like parties, after work rinks and sports events. However, when they do indulge themselves they prefer a premium brand and are more likely to be influenced in their choice by philosophy of the brand, taste of the beer and design and label of the bottle. They are also more likely to ask for a premium light beer in much(prenominal) friendly occasions for their need to stay in control. Brand Positioning Consumers choice tends to be driven by image of the brand , divides won, testimonial from peers and variety available rather than brand loyalty.Thus focusing on brand development will strategically enhance brand power. Branding would also enable us to position our brand to create a better fit between our product and needs and set of the target audience which in turn would help us attract and retain monomania of the customers. This strategy will also benefit by having a spill over movement to other James Boag products. However, the challenge would be to achieve this in a highly competitive market, while appealing to a sophisticated consumer who has a capacious range of beverage choices.The key to achieving this would be through, building the brands prestige and distinctive values through the advertising campaign in order to differentiate the brand from the aggressive competition in the category and create a proposition that is attractive to premium beer drinkers. The values the brand should position itself to equal are of high quality refreshing beer graveled at successful, in-control, high achieving individuals deserving the best. (Appendix C Exhibit 4) For this purpose James Boag premium will be marketed as the flagship beer for the brand.In line with the overall strategy, both Premium and Premium light beer bottles would have similar coloured distinctive, easily identifiable bottles with an embossed logo and following brand stickers displayed on them. James Boag Premium James Boag Premium Light The specially desi gned sticker helps reinforce our brand message of a unique, refreshing, original, premium quality brewed beer and also indicates towards our origins from Tasmania. The back of the bottle will bear a sticker with a short description about the tasting notes and brewing lucubrate about the beer.This strategy will work in three ways reinforce the premium tag, easy differentiation from our competitors products and establish ownership over the brand. Other strategies to support in building the brand equity include Continuing submission of James Boag premium beers into key international beer award Participate in key federal and state tourism initiative Actively pursue promotion at key events like corporate functions and sports events( such as tennis, golf, sailing , formula racing etc ) to create association with the brandTo this end the allocation for marketing spend on Premium and Premium light beer will be in 70% vs 30% ratio. We will use James Boags Premiums communication campaign to develop the brand values for the James Boag brand whilst the aim of the James Boags Premium Light campaign is to predominantly raise awareness of the brand. Product Strategy The James Boag premium beer will be the flagship beer and our strategy would be to continue to draw consumers to this quality awarded beer. We would leverage the quality and interest generated with this product and seek to drive sales seeing that consumers clearly like this product.James Boag Premium Light will be aimed more towards female market and for times when customers are in light beer occasion. Through this line extension we will seek to extend and expand on our market share and also prevent consumers to turning towards our competitor brand. For on-trade sales through pubs and restaurant, our range would be served in specially crafted James Boag logo embossed glasses. For sales through supermarkets and liquor stores the beer would be sold in distinctive James Boag logo packaging.Corporate functions a nd sales at other events will be targeted with newly designed and distinctive casks with draining taps. It is hoped these steps would build on our communication campaign to sell our brand as an experience and also at the same time in some manner fulfil the desires and values our consumers are aiming for. Pricing Strategy The key objective of pricing strategy is association of brand with quality. Product life cycle map of James Boag premium is in the growth phase, which would suggests pricing strategy should be, to maintain price and retain consumer base.Consistent with our brand strategy of focused differentiation, it would be recommended that the most appropriate method of creating pricing strategy would be to use price-value relationship. damage-value relationship would allow us to indicate our product is premium , and our brand satisfies key values the consumers are facial expression for. However, it would be important to price our product strategically as pricing above the mar ket leader may discourage purchase, whilst pricing too utmost below signals an inferior product offering. authenticly we are priced at least $50/case, and we recommend maintaining this while keeping a close eye out for competitors pricing and then reacting appropriately (Appendix D Exhibit 1). Distribution Strategy Key opportunity for James Boag premium is to exploit the availability of Lion Nathans already existing large distribution network. Based on this our distribution strategies for the next 3 years will be to focus on following multiple channels On-tradeConsistent with our overall strategy to increase market penetration through generating brand awareness and attracting more drinker to try our drawing which we hope will transfer to increase buying for domestic consumption on-trade channels would be of prime importance. We are expecting to increase penetration by at least 40% by subscribing to restaurants and pubs which currently are available through the Lion-Nathan channel network . These locations will also be provided incentives like free embossed glasses to promote and sell our draught beers.Off-trade With an intent to retain the customers who try our products through on-trade establishments off-trade channels like supermarket and liquor store would also be consistently targeted with regular promotions and negotiating for more shelf space. We expect to increase our penetration by 30% in off- trade establishments in the next 3 years through this strategy. Events Specific events both corporate, sporting and social events would also be important for our marketing strategy , We hope to increase our distribution to such events by 30%.Also keeping in mind the technological changes and the savvy nature of our typical customer we propose to launch direct ordering online for bulk buys for social and corporate events. Integrated Marketing Communication Strategy The prime target for marketing activity is the 25-45 years old individuals. The following marketi ng activities will form the overall communication strategy with main focus being the end users Advertising Print advertising in weekend edition of newspaper like The Age, The Australian, Weekend Financial Review and in upmarket business and lifestyle magazines highlighting both premium ranges. Commercials on TV and Cinema before specifically identified shows and movies which conform with the image of the brand. Dedicated web site with information and brand message of James Boag. The content will be directed at our target consumer with information about promotional events, product details , games , discussion forum and James Boag online club. Sponsorship Sponsorship of key upmarket events like Tennis, Golf, Racing , Grand Prix and Sailing. Also concentrating on Federal and State business award functions. Cultural Events like Moonlight cinemas, Operas and Theatre Point of Purchase and Packaging Distinctive signs and displays positioned at delegate of sales in supermarkets , liqu or stores and bars. Review of all packaging and bottle labels to align the brand message. Promotion In house promotion at upmarket bars, restaurants and lounges telephone circuit conventions and corporate events Motor shows, Horse racing cups , Gourmet food road shows. Stealth Marketing to celebrate the purchase of another luxury brand item like a car with a James Boag premium.Public Relations Networking dinners held and attended by General Managers with specific attention towards corporate functions. go-ahead of James Boag Centre for Beer in Launceston, Tasmania which will house companys memorabilia, with a tasting bar and organised tours through the brewery and also sell branded merchandise. This would allow a visitor to become educated about the brand and turn them into ongoing loyal customers by giving them ownership over the brand. The centre will be advertised through tourist publications. Marketing BudgetThe full budget for 2008-10 periods is shown in Appendix in lin e with corporate objectives requirements. The product market expenditure strategies are based on anticipated expenditure. (Appendix E Exhibit 1) Broadly the divisions will be made as follows 50% for market penetration of James Boag premium beer 10% for market development 30% towards James Boag premium light beer 10% for diversification Implementation The budget for the 2008 2010 Strategic Marketing Plan is based on targeted revenue objectives with provisions for proposed activities recommended in the plan.The proposed fund allocations range for the marketing costs are consistent with the requirements prescribed in the strategic marketing plan for product, pricing, distribution, IMC strategies and predicted sales revenue growth (Appendix B Exhibit 9-13). In the marketing budget, the IMC component has the highest allocation to meet the increased advertising due to product and brand positioning strategies, promotions and new product launch activities. Implementation of the strategi c marketing plan will begin in the Q3 of 2008. dilate of the implementation in terms of activities, ownership and timelines are provided in (Appendix F Exhibit 1) Evaluation and control Performance evaluation and control of the strategic marketing plan for James Boag premium will include tracking indicators such as Customer satisfaction, Brand loyalty, sales, Market Share, Distributor satisfaction. Monitoring of these key indicators enables perplexity to measure performance and to take corrective action when variances are revealed. The following table shows how and when these indicators are captured and made available for making decisions on changes to Strategic Marketing planning. Indicators Metric used Frequency of review Data source Market share % market share by value &Monthly Data monitor volume Sales performance Sales revenue Weekly Financial systems reports Customer satisfaction/Loyalty follow yearlyly CRM systems Profitability Gross margin Monthly Financial sy stem reports Competitive Position %share by value & volume Annually Data monitor Distribution satisfaction Survey Quarterly External agency ConclusionIn summary, we recommend that to achieve our desired increase in market share we would have to adopt a focus differentiation strategy. This would in turn require an increase budgetary allowance to the tune of 54 AUD million in 2008. Overall strategic marketing plan is to concentrate on 1) Increase brand awareness This would help us increase our market share by attracting new customers and help maintain loyalty. 2) Increase market penetration By strategically aligning pricing and distribution to the brand. 3) Line extension Introducing James Boag premium light would allow us to attract the growing female segment of the market and extend our consumer base. 4) Maintain the cost price ratioAppendices pic Appendix A Beer Market Exhibit 1 Data monitor 2006 Beer in Australia pic Exhibit 2 Total Value growth by Beer subsector pic Exhib it 3 Market Share of Competition pic Appendix B Financial Overview Exhibit 1 The Du Pont Identity (also known as Du Pont analysis or Du-pont analysis) is an expression which breaks clear On Equity (ROE) into three parts. a) operational efficiency measure by profit margin b) Asset use efficiency heedful by asset turnover c) Financial leverage measured by equity multiplier In the analysis the ROE is calculated by the formula ROE= Net Profit After Tax/Sales * Sales/Assets * Assets/Equity Du-pont abstract NP/Sales Sales/Assets Assets/Equity Analysis 2002 0. 10 0. 40 1. 88 0. 07 2003 0. 10 0. 41 1. 79 0. 07 2004 0. 09 0. 43 1. 71 0. 06 2005 0. 13 0. 43 1. 63 0. 09 2006 0. 12 0. 71 3. 46 0. 30 2007 0. 14 0. 75 3. 16 0. 34 Exhibit 2 Return on Equity Lion Nathan Ltd. 2003-10 pic 2008 2009 2010 Market share increase in total 40% 42% 43% Value increase total in AUD/millions 1,661 1,757 1,857 James Boag Premium beer share increase 12% 15% 18% Total Sales Revenue Forecas t Lion Nathan Ltd stratum 2008-10 Lion Nathan Ltd forecast 2008 2009 2010 Total revenue growth at 6% per annum AUD/millions 2,129 2,253 2,381 Exhibit 8 Strategic Gap Lion Nathan Ltd. 2008-10 Strategic Gap 2008 2009 2010 Current growth estimates 5% annually. 2,065 2,169 2,277 Projected growth estimates 6% annually. 2,129 2,253 2,381 Gap AUD /million 64 84 104 Exhibit 9 Estimated revenue from existing products in existing markets (market penetration) Millions/ AUD Year 2008 Year 2009 Year 2010 Est. revenue via current strategies * 2065 2169 2277 Additional revenue via modified strategies** 32 42 52 Total revenue 2129 2253 2381 Re stated the current revenue projections **estimate 50% of gap Exhibit 10 Estimated potential revenue from existing products in new markets (market development)* Millions/AUD Year 2008 Year 2009 Year 2010 Est. revenue via market development strategies * 15 20 25 * James Boag premium brand positioning via advertising and promot ions. Exhibit 11 Estimated potential revenue from new products in existing markets (new product development)* Millions/AUD Year 2008 Year 2009 Year 2010 Est. evenue via NPD strategies * 5 7 10 * James Boag Premium light** targeted at female consumers and for occasions when staying is control is important. Exhibit 12 Estimated potential revenue from new products in new market segments (related diversification)* Millions in AUD Year 2008 Year 2009 Year 2010 Est. revenue via related diversification strategies * 12 15 17 Exhibit 13Fulfilling Strategic Gap Year 2008-10 Millions/AUD 2008 2009 2010 Market penetration 32 42 52 Market development 15 20 25 New product development 5 7 10 Related diversification 12 15 17 Total 64 84 104 Appendix C Strategic PositioningExhibit 1 Boston Consulting Group Matrix James Boag premium market shareLargest competitors market symmetry Relative market share share 9. 1% 24% 2. 6 High Source James Boag ma rket report Key Ratio 1. 0 Not a market leader Ratio = 1. 0 Tied for lead Ratio 1. 0 Market Leader Exhibit 2 GE/McKinsey Matrix Key punctuate 0. 5 High attractive Score = 0. 5 medium attractiveProduct line James Boag Premium Score 0. 5 non attractive Market attractive elements Weight Score Rating Market factors 25% 0. 9 23% Competition 25% 0. 4 10% Financial and economic factors 20% 0. 7 14% Technological factors 15% 0. 11% Socio-political factors 15% 0. 8 12% 70% Total High Business position elements Weight Score Rating Brand Image 20% 0. 9 18% Economies of scale 15% 0. 8 12% Product focus/differentiation 15% 0. 7 11% Reliable supply of raw materials 10% 0. 7 7% Distribution networks 15% 0. 12% Quality say-so 15% 0. 8 12% Manufacturing technology 10% 0. 8 12% 84% Total High Exhibit 3 Marketing Strategy uninflected tool used to map James Boag Strategic position for James Boag Premium (market attractiveness combined with Pr emium competitive position) Product life cycle Growth Increase market share thru penetration, build intensive coverage , emphasise brand loyalty, maintain prices, BCG Product Portfolio model Stars Invest for growth thru geographical expansion, line expansion and via product differentiation GE/McKinsey model Invest to grow and concentrate on maintaining market share Porters 5 forces model Moderate overall market attractiveness market conducive for investment with high competition. Porters CA strategy model focused differentiation Exhibit 4 Brand Positioning and Development The brand will be positioned keeping in mind the typical customer profile of a premium beer drinker, and the values they aspire and relate with. In line with this strategy the communication campaign through print and media advertisement will aim to depict James Boag brand providing a consumer with a image of a successful, in-control, high achieving individual who are looking for the best. This mes sage will be beef up through product cues like a easily distinguishable and specially designed bottle and brand logo and also an efficient customer relation management. The message of brew quality will be strengthened through a robust quality control mechanism with a clearly stated shelf life period. Appendix D Pricing Strategy Exhibit 1 Comparative price of Premium Beers Sector Brand Case Price* Mainstream Victoria Bitter $33 Light (2-3% alc. vol) Hahn Premium Light $22-$24 Light (2-3% alc. vol) James Boags Premium Light $29 Premium James Boags Premium $50 * Case Prices vary widely, dependent on individual retailer price promotions, but these prices represent an average Appendix E Marketing Budget Exhibit 1 Marketing Expenses Marketing budget allocation 2008 2009 2010 Amt in AUD/Millions Total Marketing budget 362. 0 398. 2 438. 0 Marketing budget for James Boag range-15% 54. 3 59. 7 65. 7 Allocation Market penetration (IMC)-50% 27. 2 29. 9 32. Branding costs 1 0. 9 11. 9 13. 1 On trade expenses 8. 1 9. 0 9. 9 Off trade expenses 5. 4 6. 0 6. 6 Event sponsorship expenses 1. 4 1. 5 1. 6 Misc Advertisement and Promotion costs 1. 4 1. 5 1. 6 Market develoment-10% 5. 4 6. 6. 6 New product development-30% James Boag Premium light 16. 3 17. 9 19. 7 Diversification-10% Casks and Draughts 5. 4 6. 0 6. 6 Appendix F Implementation Plan pic Appendix G Lion Nathan Financial teaching 2002-07 Exhibit 1 Lion Nathan Ltd Financial statement 2002-07 Lion-Nathan LTD- Financial statements (consolidated group figures) figures in AUD-Millions 2002 2003 2004 2005 2006 2007 Income statement Sales Revenue 1,662. 4 1,772. 2 1,841. 1 1,757. 5 1,845. 0 1,967. 0 Total Revenue 1,712. 4 1,826. 4 2,013. 2 1,797. 2 1,883. 1 2,000. Cost of Goods Sold 1,353. 5 1,446. 4 1,668. 9 1,380. 8 1,484. 6 1,595. 0 Sales and Marketing costs 280. 2 301. 2 303. 2 305. 2 309. 0 329. 1 EBIT 266. 3 285. 0 251. 4 337. 6 329. 8 351 . NPAT 161. 9 180. 0 160. 1 224. 8 226. 8 282. 2 Balance Sheet Cash on Hand 10. 8 16. 8 5. 7 8. 2 19. 0 6. 9 Current Assets 504. 0 528. 7 610. 2 490. 0 541. 4 544. Non Current Assets 3,700. 8 3,802. 1 3,656. 8 3,574. 0 2,048. 7 2,075. 7 Total Assets 4,204. 8 4,330. 8 4,267. 0 4,064. 0 2,590. 1 2,620. 3 Current Liabilities 493. 8 430. 6 520. 7 512. 6 525. 5 544. Non Current Liabilities 1,477. 6 1,481. 0 1,254. 1 1,057. 9 1,316. 4 1,247. 5 Total Liabilities 1,971. 4 1,911. 6 1,774. 8 1,570. 5 1,841. 0 1,792. 0 Equity 2,233. 4 2,419. 2 2,492. 2 2,493. 5 748. 2 828. Cash Flow Statement Net Cash from Operating Activities 231. 1 232. 9 274. 0 334. 0 308. 0 298. 5 Net Cash from Investing Activities -399. 6 -108. 0 -99. 2 20. 8 -112. 6 -73. 3 Net Cash from Financing Activities 168. 4 -117. 3 -218. 6 -319. 4 -184. 6 -237. Earnings per Share 34. 0 33. 7 37. 9 42. 1 48. 6 50. 2 Appendix H C ompetitors Financial Analysis Exhibit 1 Foster Group Ltd Financial Statement 2002-07 Fosters Group Ltd ( consolidated figures) Amount in AUD/ million 2002 2003 2004 2005 2006 2007 Sales revenue 4,572. 0 4,731. 5 3,908. 0 3,972. 3 4,533. 7 4,760. Gross profit 2,273. 0 2,344. 6 1,887. 2 1,981. 5 2,067. 1 2,094. 7 EBIT 1,038. 6 1,023. 4 949. 0 1,257. 0 1,065. 7 1,116. 8 NPAT 560. 9 470. 4 806. 0 941. 0 1,169. 8 969. Marketing Expenses 300. 8 313. 5 343. 8 379. 6 350. 8 360. 1 Total Assets 9,511. 0 9,588. 9 8,443. 1 11,745. 3 10,439. 1 9,563. 0 Total Liabilities 5,299. 1 5,095. 8 3,842. 9 6,801. 2 5,957. 4 4,929. Total Equity 4,211. 9 4,493. 1 4,600. 2 4,944. 1 4,481. 7 4,633. 2 Ratio analysis NPM ratio 12. 3 9. 9 20. 6 23. 7 25. 8 20. GPM ratio 49. 7 49. 6 48. 3 49. 9 45. 6 44. 0 ROE 13. 3 10. 5 17. 5 19. 0 26. 1 20. 9 ROA 10. 9 10. 7 11. 2 10. 7 10. 2 11. Debt to Equ ity Ratio 125. 8 113. 4 83. 5 137. 6 132. 9 106. 4 Exhibit 2 FGL Sales Revenue 2002-07 Exhibit 3 FGL Marketing Expense 2002-07 Exhibit 4 Net Profit security deposit Foster Group Ltd. Exhibit 5 Gross Profit Margin Foster Group Ltd. 2002-07 Exhibit 6 Return on Equity Foster Group Ltd. 2002-07 Exhibit 7Debt to Equity Ratio Fosters Group Ltd. picpicpic 1 2007 Annual Report Lion Nathan Ltd Australia segmental 2 Porter, What is strategy? , pp 61-78. The concept of Product Life Cycle postulates that products, like human beings, pass through a number of different phases or stages of their life. The stages are described as introduction, growth, competitive turbulence, maturity and decline. GE/McKinsey Model BCG is a two dimentional model based on market growth and relative market share. The chart on the left sumarises the results obtained for the BCG analysis conducted for the James Boag premium beer line. (For further details refer to Appendix CExhibit 1 ). BCG Model Another tool used t o identify effective product strategies is the GE / McKinsey model. This is used to identify the attractiveness of the market and the relative position of the brand. (For further details refer to Appendix C Exhibit 2 ).