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A PROJECT REPORT ON MARKETING STRATEGY OF AMUL (MMM-A + PGDM )
SUBMITTED BY: SIDDARTH RAVINRAN JAYDEV KUMAR DHARMENDRA PRASAD
SINHGAD INSTITUTE OF BUSINESS ADMINISTRATION AND RESEARCH 2010-2012
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ACNOWLEDGEMENT We extend my sincere thanks to Mr. SwapnilPatilfor providing us the opportunity to work on this project. Weexpress our deep sense of indebtness to him because he has been the moving force behind the successful accomplishment of the project we thank him for taking time out of his busy schedule and guiding me in the project. We would also like to thank our project guideSwapnilPatil and faculty membersfor their valuable guidance and encouragement at all the stages of the project.
3 PREFACE The success of any business entity solely depends on how effectively does it utilizes its optimum resources and how soon does it make arrangements for the removal of the customer¶s grievances. Moreover, the company should always be ready to make necessary changes according to the requirement in order to attract more customers so as to maintain a substantial growth in the market. The topic given to me was: ³MARKETING STRATEGIES AMUL´ We have tried to put our best efforts to complete this task on the basis of skill that we have achieved during our studies in the institute. We have tried tried to put my maximum effort effort to get the accurate statistical data. If there is any error or any mistake in collecting the data, please ignore it.
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INDEX
Objectives of the project
Introduction of the Topic
Company profile of Amul
Amul and co-operation
GCMMF
PEST Analysis amul
4P¶s of markering
Comparison between chocolate companies
Conclusion
Bibliography
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OBJECTIVES OF THE PR OJECT
The main objective of the study on this project is to demonstrate de monstrate the marketing strategies of Amul India Ltd. And to arrive at my findings, I have done PESTanalyses. PE STanalyses.
And also 4 P¶s of o f Marketing: Product Price Phys Physic ical al Dis Distri tribu buti tion on Prom omo otion tion
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INTR ODUCTION TO THE TOPIC .
The topic ³To study about Strategy and Market Share of Amul chocolates³ highlights on the market share of Amul Chocolates Pune city in comparison to existing player in the Milk chocolate Market. The market share can be found with the help of retailers. As the competitors are concerned there are only two of them i.e. Cadbury and Nestle The study is also concerned to find out the various reasons due to which the retailers do not prefer to sell Amul Chocolates.Moreover the study also helps in knowing the best medium for creating the awareness about the t he Amul Chocolates. To know the Market share and problems faced by retailers is very important for every organization for their promotion, expansion and development.
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COMPANY PR OF OFILE
1. Formed in 1946, Amul has initiated the Dairy Cooperative movement in India and formed an Apex Cooperative Organization, Gujarat Co-operative Milk Marketing Federation Ltd. (GCMMF), jointly owned by some 2.1 million milk producers in Gujarat, India. Its products, including milk powders, liquid er, ghee, cheese, chocolat choco late, e, ice cream cream and pizza liquid milk , butt butter, are widely used throughout India and abroad and have made Amul the largest food brand in India today with an annual turnover t urnover of some Rs.29 Billion ($US 616 million) million) per annum.
2. The primary goal of Dr. V. Kurien, Chairman, GCMMF, has been to build a strong Indian society economically through an innovative cooperative network, to provide quality service and products to end- consumers and good returns to the farmer members. Dr. Kurien states, ³We have traversed a path that few have dared to. We are continuing on a path that still fewer have the courage to follow. We must pursue a path that even fewer can dream to pursue. Yet, we must. We hold on trust the aims a ims and aspirations o millions millions of o f our countrymen´.
3. Information Technology has played a significant role in developing the Amul brand. The logistics behind co-ordinating the collection of some 6 million litres of milk per day from 10,755 separate Village Cooperative Societies throughout Gujarat and then storing, processing and producing milk products at the respective 12 District Dairy Unions, are awesome. The installation of 3000 Automatic Milk Collection System Units (AMCUS) at Village Societies to capture member information, milk fat content, volume collected and amount payable to each member has proved invaluable in ensuring fairness and transparency throughout the whole Amul organization.
4. In 1996 Amul was one of the first major organizations in India to have a website and this has been used both to develop an intranet of Amul distributors as well as a cyber-store for consumers, one of the first first examples of e-co mmerce activity activity in India.
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AMUL AND CO-OPERATION The CEO, Mr. B M Vyas, said that. ³Amul is not a food company; it is an IT company in the food business´. In saying this he was recognizing that the most efficient way of building links between milk producers and consumers so as to provide the best returns for the both is through IT innovation.
Thus is why Amul has embraced the ideas behind coop with such enthusiasm. Not only will the TLD enable consumers in India to recognize an established brand they can trust online, it will enable Amul to begin trading competitively throughout the world, reaching markets, which have hitherto been inaccessible.
The CIO, Mr. SubbaraoHegde said, ³Information Technology is the most effective tool we have in communicating with our members and the millions of consumers who purchase Amul products throughout India every day. Coop not only reflects the cooperative values which shape our own organization democratically dynamic, it will also give us a vital business advantage as we seek to develop t he Amul brand throughout the world.´
AMUL means ³priceless´ in Sanskrit. The brand name ³Amul,´ from the Sanskrit ³Amoolya,´
was suggested by a quality control expert in Anand. Variants, all meaning ³priceless,´ are found in several Indian languages. Amul products have been in use in millions of home since 1946. Amul Butter, Amul Milk Powder, Amul Ghee, Amulspray, Amul Cheese, Amul Chocolates, AmulShrikhand, Amul Ice cream, Nutramaul, Amul Milk and Amulya have made Amul a leading food brand in India. (Turnover: Rs. 29 billion in 2004). Today Amul is a symbol of many things. Of high-quality products sold at reasonable prices.
9 GUJARAT
CO-OPERATIVE MILK MARKETING FEDERATION(GCMM F)
An Overview: -
Gujarat Cooperative Milk Marketing Federation (GCMMF) is India¶s largest food products marketing organization. It is state level apex body of milk cooperative in Gujarat which aims to provide remunerative returns to the farmers and also serve the interest of consumers by providing quality products which are goo d value for money. 12 district cooperative milk producersUnion Memb Members: ers: No. of Produ Producers Memb Members ers 2.36 million 11,333 No. of Villa Village ge Soci Societies ties Total Total Milk h ndli ng ca capacity6.9 million liters per day ilk hand ling Milk co ilk coll llec ecti tion on (Total (Total ±2002-03) 1.86 billion liters Milk co ilk coll llec ecti tion on (Daily (Daily Avera erage (2003 -04) 4.97 million liters 511 metric Tons per day Milk Dr ng Ca Capacity ilk Dryi ying 2340 Mats per day Cattlefeed attlefeed man manuf actur turing Capacity: ity:
Sales ales Tu Turnover 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2005-06 2006-07 2007-08 2008-09
Rs (million million) 11140 13790 15540 18840 22192 22185 22588 23365 27457 28941 37736 42778 52448 67113
US $ (i (in millions millions) 355 400 450 455 493 493 500 500 575 616 850 1050 1325 1504
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PEST ANALYSIS OF AMUL
P-)Since the budget range is decontrolled, no political effects are envisaged.
E-1) Increasing per capita income resulting in higher disposable income
2) Growing middle class/urban population ± increase in demand. 3) Low cost of production ± better penetration.
S-1) Per capita consumption expected to increase ± fashion.
2)Increasing gifts culture ± increase in demand.
3) Lower cholesterol than ³Mithais´ (sweet meat) ± substitute demand
T-)Will have to reinforce technology to international levels once India is a ³free´ econo my
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4 P¶S OF MARKETING PR ODUCT:-
Satisfaction suffices. But delight dazzles the average company will compete for customer by conforming to her expectation consistently. But the winner will surpass them by constantly exceeding her expectation, delivering to her door step additional benefits which she would never have imagined possible. Cadbury¶s offer such product. The wide variety products offered by the company include: List of Produ Products Ma Mark eted: -
Brea Bre adsprea dspreads: Amul Butter Amul Lite Low Fat Breadspread Amul Cooking Butter
Cheese R ange: Amul Pasteurized Processed Cheddar Cheese Amul Processed Cheese Spread Amul Pizza (Mozarella) Cheese Amul Shredded Pizza Cheese AmulEmmental Cheese Amul Gouda Cheese AmulMalaiPaneer (cottage cheese) Frozen and T inned Utterly Delicious Pizza Mith ithaee R ange (Et (Ethn hniic Sweet Sweets): Carda mom) AmulShrikhand (Mango, Saffron, Almond Pistachio, Cardamom) AmulAmrakhand AmulMithaeeGulabjamuns AmulMithaeGulabjamun Mix AmulMithaeeKulfi Mix
UHT Milk Milk R R ange: AmulTaaza 3% fat Milk Amul Gold 4.5% fat Milk Amul Slim-n-Trim 0% fat Milk
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Amul Chocolate Milk Amul Fresh Cream Amul Snowcap Softy Mix AmulTaaza Double Toned Milk Pure Ghee:
Amul Pure Ghee Sagar Pure Ghee Amul Cow Ghee Inf ant Milk R ilk R ange: Amul Infant Milk Formula 1 (0-6 months) Amul Infant Milk Formula 2 (6 months) Amulspray Infant Milk Food Milk Powders: ilk Powders: Amul Full Cream Milk Powder Amulya Dairy Whitener Sagar Skimmed Milk Powder Sagar Tea and Coffee Whitener
Sweet Sweetened Condensed Milk M ilk : AmulMithaimate Sweetened Condensed Milk Fresh Milk Milk : AmulTaaza Toned Milk 3% fat Amul Gold Full Cream Milk 6% fat Amul Shakti Standardised Milk 3% fat Amul Smart Double Toned Milk 1.5% fat Curd Produ Products: AmulMastiDahi (fresh curd) Amul Butter Milk ,AmulLassee AmulIcecre mulIcecream ams: s: TuttiFrutti) Royal Tre Treat at R ange (Rajbhog, Cappuccino, Chocohips, Butterscotch, TuttiFrutti) Royal Nut-o-Mania R ange (KajuDrakshi, KesarPista, Roasted Almond, KerarCarival, BadshahiBadamKulfi, ShistaPistaKulfi ShistaP istaKulfi)) (Anjir, Roasted Ro asted Almond) Utsav R ange (Anjir, Choco late) imply Deli Deliccious R ange ( Vanilla, Strawberry, Pineapple, Rose, Chocolate) Simp Treat (Alphanso Mango, Fresh Litchi, Anjir, Fresh Strawberry, Black Nature¶s ature¶s Treat Currant) nda ae R ange (Mango, Black Currant, Chocolate, Strawberry) Sund illennium ium Icecream Icecream(Cheese with Almonds, Dates with Honey) Millenn Milk Bars (Chocobar, Mango Dolly, Raspberry Dolly,ShahiBadamKulfi, ShahiPistaKulfi, MawaMalaiKulfi, Green P istaKulfi) istaKulfi)
13 Cool Cool Cand ndiies
(Orange, Mango)
Cassatta ssatta Triicone(Butterscotch, Chocolate) Tr Megabit Megabitee Alm Almond ond Cone rostik ± ± 3 layer chocolate Bar Frostik Fundoo R ange ± exclusively for kids P ineapple) limScoop Fat Free Froz rozen Dessert Dessert (Vanilla, Banana, Mango, Pineapple) SlimScoop He Healt alth: h: Isabcool Chocolat Chocolatee & Confecti Confectioner onery y: Amul Milk Chocolate AmulAlmondbar AmulFundoo AmulChocozoo AmulBindaaz Amul Fruit & Nut Chocolate Brown Bevera erage: Nutramul Malted Milk Food Milk Dr ilk Driink : Amul Shakti Flavoured Milk Rea Ready to Serve Sou Soups: Masti Hot & Sour Soup
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PRICING:Second P of marketing is not another name for blindly lowering prices and relying on this strategy alone to increase sales dramatically. The strategy used by Cadbury¶s is for matching the value that customer pays to buy the product with the expectation they have about what the production is worth to them.
AMUL
has launched launched various various products which which cater to all customer segments. segments. So every
customer segment has different price expectation from the product. Therefore maximizing the returns involves identifying right price level for each segment, and then progressively moving through them. In milk choco milk chocolat latee Amul Amul has the foll follow owiing brands: Name ame of chocolat choco latee
Weiight We ght
Pri Price
(Rs.) Amul Milk Chocolate 35g
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AmulFundoo
30g
10
AmulFundoo
15g
5
Amul Fruit Nut
35g
15
AmulBindaaz
30g
10
AmulAlmondbar
35g
10
AmulChocozoo
500g(Tub) 138
All the chocolates are made up of: Milk Fat Sugar
-
(2%) -
(55%)
Cocoa Solids - (7.5%) Solid Milk
- (20%)
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Phy Physical Distribution ibuti on ± ³Pla ³Place ce´ In a product and price parity situation, the brand that sells more is the one that reaches the highest number of customers. India ± 1 billion people, 155 million household has over 4 million retail outlets in 5351 urban markets and 552725 villages, spread cross cro ss 3.28 million million sq.
Prom Promotion tion If an advertisement is to communicate effectively, the receiver must at least half want it to, and be prepared too take step toward the sender. Effective advertising is rarely hectoring or loudly explicit«. It often both attracts and generates arm feelings. More often than not, a successful campaign has a stronger element of the unexpected a quality that good advertising shares with much worthwhile literature. To penetrate into the inner recesses of her memory, communication must first ensure exposure, grab her attention evoke her comprehension, grab her acceptance and then extract retention competing with thousands of other units of co mmunication trying to do the same.
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COMPARISION BETWEEN CHOCOLATE COMPANIES 1) Name ame of Chocolat Chocolatee Com Companies and thei heir penet penetration ation in mar mark etThe table below deals in finding the numbers of retailers that sellsdifferent company chocolates and their penetration in markets. Table able 1.1 Chocolat Chocolatee com companies and thei heir penet penetration ation
Name of company
No of shops
Amul
20
Cadbury
149
Nestly
Other
Graph
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1.1
Chocolat Chocolatee com companies and thei heir penet penetration ation 149
160
148
140 120 100 80 60 40 20
18
20 0
Amul
Cadbury
Nestle
Others
The gra number of retailers selling different company chocolates. There are graph 1.1 shows the number only 20 retailers i.e. 13.33% who deal in Amul chocolates. The percentage is very less compared to Cadbury and Nestle.
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2) Mark et sha share
The table below deals in finding the Market Share of Amul Chocolates and other companies chocolate. Table able 2.1 Mark et
Sha Sh are
Name of company
Total Sale (Per month)
Amul
Rs.
Cadbury
Rs. 239750
Nestle
Market (%)
3130
share
00.84% 64.5%
Rs. 125940
Others
Rs.
2500
Total
Rs. 371320
33.9% 00.67% 100%
Graph 2.1 Market Share
1%
Amul
34%
Cadbury 64%
1%
Others Nestle
The gra graph 2.1 shows the market share of different company chocolates in terms of rupees. From the graph we can say that the market share of Amul chocolates is only 1%, which is very less, compared to other companies. Cadbury has the maximum share of 64.5%.
18 3) a)Br Bra ands of Amul Amul chocolat choco lates es sol sold on Amul Amul chocolat chocolatee Outle utlet.
The table below helps in finding the different brands of Amul Chocolates that is available on Amul Chocolate Outlet. A shop that sells even one Amul Chocolate is an Amul Chocolate Outlet Table able 3.1 Bra Br and of Amul Amul Chocolat Chocolates es & thei heir selli selling ng percenta percen tage ge
Name of chocolate
No. Of Amul chocolate Outlet
A Amul Milk chocolate
8
B
AmulFundoo
4
C
Amul Fruit n Nut
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D AmulBindaaz
4
E
AmulAlmondbar
16
F
AmulChocozoo
6
G Amul Rejoice
0
H All Chocolates
0
Bra Br and of Amul Amul Chocolat Chocolates es & thei heir selli selling ng percenta percen tage ge
20 16 15 11 10
8 6 4
4
5 0
0
0
A
B
C
D
E
F
Graph-3.1
G
H
19 The Graph 3.1 above shows that Amul Almond Bar is sold at most of the Amul Chocolate outlet followed by Amul fruit n Nut &Amul Milk Chocolate. There is not a single outlet that sells Rejoice. 3) b) Order rderiing Patt Pattern ern The table table below deal dealss in f ind ndiing the orderi ordering patt pattern ern for Amul Amul Chocolat Chocolates es. Table able 3.2 Order rderiing Patt Pattern ern
Graph
Option tion
No. of Retail Retailers ers
Daily
0
Weekly Wee kly
0
Mont Monthly
20
3.2 Order rderiing Patt Pattern ern
25 20 20 15 10 5 0
0
Daily
Weekly
0
Monthly
The graph 3.2 shows the ordering pattern followed by Amul Chocolate outlets. It is seen that almost all of them order once in a month since their demand is very less.
20 4) Financial ncial Support pport for prom promotion. tion.
The table below deals in knowing whether the company provides any financial support for promotion to Amul chocolate outlets. Table able 4.1 Financial ncial Support pport For Prom Pro motion tion
Option tion
No. of Retail Retailers ers
Yes
0
No
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Graph
4.1
Financial ncial Support pport for Prom Pro motion tion
20 20 15 10 5
0
0 Yes
No
The gra graph 4.1 shows the financial support for promotion. From the graph we can say that according to the retailers the company co mpany does not provide any financial support suppo rt for promotion.
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Rea Reasons for not not selli selling ng Amul Amul Chocolat Chocolates es.
The table below deals in finding the reasons for retailers due to which they do not sell Amul Chocolates. Table able 5.1 Rea Reasons For Not Not Selli Selling ng Of Amul Amul Chocolat Chocolates es Rea Reasons
No. of Retail Retailers ers
A
Distribution & Service problem
108
B
Low demand
73
C
Low Margin
98
D
Replacement Problem
45
E
No Refrigerator Refrigerator
21
F
Not Interested
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Graph 5.1
Rea Reasons For Not Not Selli Selling ng Amul Amul Chocolat Choco lates es
120
108 98
100 73
80 60
45
40
21
15
20 0
A
The gra graph
5.1
B
C
D
E
F
shows the various reasons due to which the retailers do not sell Amul
chocolates. From the graph we can say that Distribution & Service problems and Low Margin are the major reasons followed by Low demand and Replacement problem because of which the retailers do not want to sell Amul chocolates.
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Rea Reasons for Preference in selli selling ng ot other com co mpany chocolat chocolates es.
The table below deals with finding the reasons due to which the retailers prefer to sell other company chocolates and not Amul chocolates.
Table able 6.1 Rea Reasons For Selli Selling ng Other Com Company Chocolat Chocolatee Rea Reasons
No. of Retail Retailers ers
A
Good Distribution Distribution and Service
97
B
More Demand
105
C
Higher Margin
73
D
Better Replacement
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E
More Benefit Benefit
30
Graph 6.1
Rea Reasons For Selli Selling ng Other Com Company Chocolat Chocolatee 120
97
105
100 73 80 60 23
40
30
20 0
A
The gra graph
B
6.1
C
D
E
shows the reasons for which the retailers prefer to sell other company
chocolates. The major reasons are the More demand of other company chocolates, Good service as well as Higher Margin.
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The most ost attr scheme. attractive schem
The table below deals with finding the most attractive scheme according to the retailers.
Table able 7.1 The most ost Attr ttractive Schem Scheme Different fferent Sche Schem mes
No. of Retail Retailers ers
Incentive Scheme
34
Free Pack on Large Purchase
40
Increase Profit Margin
79
Lucky Draw
25
Graph 7.1
The Most Most Attr ttractive Schem Scheme 100 79 80 60 40
34
40 25
20 0 Incentive
Scheme
Free Pack on Increase Profit Large Purchase Margin
Lucky Draw
The gra graph 7.1 shows show the Different Schemes for attracting the retailers for selling Amul Chocolates. Mostly the retailers are attracted towards increased Profit Margin followed by Free Pack on large purchase.
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Medium Mediumss for Creati Creating ng Awa Awareness.
The table below deals in finding the t he most appropriate medium for creating awareness.
Table able 8.1 Effecti Effective Medium Medium
Option tion
No. Of Shops
More TV / News Advertisement
paper
150
Banners
62
Gift/Coupons
48
Graph 8.1
The Effecti Effective Medium Medium
160
150
140 120 100 80
62 48
60 40 20 0
More TV / News paper Advertisement
Banners
Gift/Coupons
The graph 8.1 shows the different effective mediums for creating awareness about the Amul chocolates. According to all of the retailers, the most effective medium is TV and Newspaper advertisement.
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CONCLUSION As we know thatAmul is very big organization and market leader in dairy products. It has maximum market share in Milk, Butter and Cheese, which are its main/core products. As we know Amul is a co-operative organization but chocolate industry is a profitable industry we can¶t ignore it. With the help of research, company can find out its week points in chocolate product and can increase its market share through rectify mistakes. People have believed inAmul¶s product and they will accept its chocolates also if effective actions were taken.The survey resulted into following conclusions :
Amul must come up with new promotional activities suchthat people become aware about Amul Chocolates like Chocozoo, Bindaaz, and Fundoo.
Quality is the dominating aspect which influences consumerto purchase Amul product,
but prompt availability of other chocolate brands and aggressive promotional activities by others influences the consumer towards them and also a lso leads to increase sales.
In comparison to Amul Chocolate, the other players such asCadbury, Nestle, areprovide a better availability and give competition co mpetition to the hilt.
People are mostlysatisfied with the overall quality of AmulChocolate, but for the existence in the local market Amulmust use aggressive selling techniques.
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BIBLIOGRAPHY 1. www.amul.com 3. www.google.com 4. www.marketresearch.com 5. www.dairy.com 6. Research Methodology. (HarperW.Boyd, C. R. Kothari
[email protected]
