PREFAC E “Knowledge and human power are synonyms”, once said the great philosopher Francis Bacon. However based on the experience within today’s global markets, he would probably say, “The ability to capture, communicate & leverage knowledge to solve problems is human power”. This raises the question how exactly one can best capture, communicate & leverage knowledge, especially within world of system engineering. The answer probably lies in statement itself by communicating your ideas and devising ways and means to give shape to your plans in to reality, which requires a longterm planning, investment and shrewd thinking. The tryst for knowledge and power led me to two years M.B.A. degree course as part of this long-term investment. This course not only enabled me to focus firmly on the current trend but also helped to focus on future changes. As a part of this M.B.A. degree, students have to undergo a project, which is designed keeping the prerogative and preferences of industry in mind. This particular project allows a student to implement what she has learned within the four walls of classroom. It is here that the caliber of student is tested to find his flexibility for rigorous tasks assigned to her in future. This report that I am submitting intends to highlight my versatility in sustaining the pulls and pressure of day to day
professional life and put to perspective the facts that I am capable enough to deliver whenever a challenge is thrown to me. This report is divided in two parts. The first part gives the basic information about the project, the industry and the company. The second part consists of Research Analysis and Conclusion on the basis of particular Research Process. At the end I have provided a short list of the reference books and the sites that provided useful information during the project.
ACKNOWLEDGEMEN T Knowledge in itself is a continuous process. At this moment of my substantial enhancement I rarely find enough words to express my gratitude towards those who were constantly involved with me during my project and making it a success. Men become good through practice than by nature. I am grateful to Prof. Neeraj Amarnani, faculty of N.R. Inst. of Business Management who created this opportunity to work on the project. I am also thankful to all the faculty members of N.R. Inst. of Business Management on for all their suggestions and help that I obtained from them. I am highly obliged to Mr. S. Keraleeyan, Product Manager Vadilal Industries Ltd. for allocating such an interesting and challenging project. Inspite of being very busy, he was ready 2
to help me whenever required. I am further thankful to personnel in Marketing Department especially Mr. Jignesh Shah for assisting through out the project with his vast knowledge of existing system. The whole staff of Vadilal Industries Ltd. was highly cooperative and I am thankful for all the support they extended to me. I am also very grateful to Mr. Amit Pandya (Asst. Mktg. Manager) for his immense help during the project. I would also like to thank my parents and all my friends who have helped me, though indirectly, through out the project duration and always have been a source of encouragement.
EXECUTIVE SUMMARY
Today is the age of globalization, and competition has become a regular feature in every industry. Every player in the market has to strive hard to sustain. Good marketing strategies are always assisting the companies to survive and grow. Consumer is the king of the market today. He is the one who chooses from all the available brands and selects the company of his will. The impact of digital revolution on Consumer Behavior sets the tone for setting up the modern marketing strategies that includes the study of consumer behavior, its diversity and its development.
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The companies today use the past consumption behavior as a foundation for creating and keeping satisfied and profitable life time customers. Consumer Research is an important tool for understanding the consumer behavior. Consumer Research describes the process and tools used to study consumer behavior. The outcome of this consumer research enables the marketers to understand and predict the consumer behavior in the market place, it is concerned not only with when, why, where, how and how often they buy it. Consumer Research is the methodology used to study consumer behavior, it takes place at every phase of the consumption process: before, during and after the process. Thus, consumer behavior study has become an integral part of strategic marketing planning. Vadilal is one of the leading companies in the organized sector of ice cream industry in India. I have tried to conduct a survey on ‘The Consumption Pattern of Ice Creams in the city of Ahmedabad.’ For this purpose I have prepared a questionnaire that includes most of the questions giving information about the overall consumption pattern and preferences of people. The sample size was 150 people, from the different areas of Ahmedabad. The report also includes the important facts about the entire ice cream industry and the SWOT analysis of all the major ice cream players of Gujarat including Vadilal.
The major findings that I got from this research include the following facts: The preferences for going out to consume ice creams and bringing it at home are equally likely. Most of the people go out to consume ice creams with their family. The frequency of consumption of ice creams is less than 2 times per week; however this is affected by seasonality factor. People generally like to consume ice creams at night, after dinner. Most preferred type of serving of ice cream is in Cone form, and second highest preference is that of Cups.
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Chocolate is the flavor of ice cream liked by most of the people. Brand and Quality are the important factors as considered by people while purchasing ice creams. Promotional activities should be increased as far as the whole ice cream industry is concerned. Vadilal is the most preferred Brand of ice cream.
HISTORY OF ICE CREAM What is Ice Cream Ice Cream is a frozen mixture of a combination of components of milk, sweeteners, stabilizers, emulsifiers and flavorings. Other ingredients such as egg products; coloring etc may be also added. This mixture, called a mix, is pasteurized before freezing. Freezing involves rapid removal of heat while agitating vigorously to incorporate air, thus imparting the desirable smoothness and softness of the frozen product.
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The broad term frozen desserts refer to ice cream and related products. Specific products includes ice cream and its lower fat varieties, frozen custard, mellorine (vegetable fat frozen dessert), sherbet, water ice and frozen confections. Some of these deserts are served in either the soft frozen or hard frozen form. The physical structure of ice cream is complicated psychochemical system. There are three phases of system liquid, solid and gas. Air cells and air crystals are dispersed in a continuous liquid phase. The liquid phase also contains solidified fat, colloidal milk proteins, insoluble milk salts, and lactose crystals in some cases, colloidal stabilizers and sugars and soluble salts in solutions. Ice Cream is palatable, nutritious, healthful and relatively inexpensive food. History of Ice Cream Ice Cream is one of the most spectacularly successful foods of all the dairy based products. By contrast, ice cream has a short history. Ice Cream evolved from the cool wine in mountain snow to hundreds of flavours that stock our grocery shelves. There are many tales surrounding the evolution of our country’s most popular dessert, Ice Cream. It is likely that Ice Cream was not invented, but rather came to be over years of similar efforts. The Chinese gourmets made the primary attempts to explore this revolutionary food for lessening the blazing heat of summer. It was Marco Polo who consigned this invention to Italy (Europe) after his voyage to China in 1295. These experiments were carried out to make novelties from ilk in France and gradually the whole Europe became addicted to Ice Cream. Before this invention reaches the Indian connoisseur, the human kind had witnessed two perilous world wars. The father of wholesale ice cream business, is the US, was Jacob Fusel, a milk dealer of Baltimore, who began to manufacture ice creams in 1851. Ice Cream permeated the India soil in 1942, when “Quit India Movement” had recently been launched. The establishment of Vadilal Soda Fountain, near teen darwaja- Ahmedabad, marked an indelible footstep in the sand of time. And this modest beginning of the monumental ice cream empire followed the strategy of imperialism. In the last decade, i.e. after liberalization and free market economy, the Ice Cream industry has gained 6
favorable breeding ground to flourish on. The brand named like Vadilal, Amul, Baskin & Robbins, Dairy Den, Walls, Go cool, Shrestha and to numerous to mention are on the lips of the multitude. The bright future is before them. They have to go ahead with chilled spirits, burning vigor and bubbling gusto… Manufacturing Process: Prevention of Food Adulteration Act requires a minimum of 10% Fat, 3.5% Protein, 15% Sugar Content, 36% total solid matter in ice creams. Ice cream manufactured with modern technology contains about 40% air. The key nonfat solids are skimmed milk powder and sugar. Ice Creams normally contain milk fat but there are several varieties that contain vegetable fat (called frozen desserts) Ice Cream has to be stocked at lower temperature as compared to milk and butter. All the liquid ingredients such as milk, cream, liquid sugar syrup etc are mixed with dry solids such as non-fat dry milk, sugar, stabilizers, emulsifiers and then blended. The blended mixture is then pasteurized to destroy the microorganisms. The pasteurized mix is pumped through under pressure to produce a smooth, uniform product. The mix is immediately cooled to –4 degree C. and then aged to improve the body and texture of the finished ice cream. Soluble flavoring materials are then added to the mix then ice cream is frozen in batch or continuous freezers. During freezing air is incorporated in to the mix resulting in increased volume. The soft frozen product is drawn from the freezer at –6 degree C. and packed at this temperature after which it is stored at a low temperature till marketed.
MARKET SIZE AND GROWTH
Ice Creams are available in various forms such as cone, cups, bar (candy), party pack etc. Cones and Candy sticks account for about 25-30% of volumes, where as cups and other novelties contributes the rest. Frozen desserts market in India is very small and refers to vegetable fat (instead of milk fat) based ice creams. Besides, a wider range of frozen desserts is also made in house and also server in five star hotels. The Ice Cream market growth during the late ‘80s and in early ‘90s was very low around 2-3% p.a. but slowly the market has started picking up especially after de-reservation of the sector in 1997. For the last 1-2 years the ice cream market in India is growing at 15-20% per annum and presently it is estimated at worth 15-16 billion. This growth rate is expected to continue for another 2-3 years because of lower base. Of the total size of Rs. 15-16 billion, around 30-32% 7
is in the hands of organized sector. The growth rate could have been ever higher but for poor infrastructure, high excise duty/sales tax etc. Market growth historically was stunted by Govt. policies. Till 1997, ice cream manufacturing was reserved for small-scale sector. The leading players were unable to invest adequately to develop infrastructure of cold chains for storage and distribution. Erratic supply and shortage of power in most parts of the country have been the major factors limiting the growth. As a result, there was a death of good quality products in the market and also lack of infrastructure to distribute the same. Cadbury had entered the market in 1992 with its Dollops brand, but was unsuccessful in building up any significant franchise and withdrew two years later. In the absence of any competition from MNCs, local players were able to build up a strong franchise in respective local areas. Some of the players built up their markets through exclusive parlors. But in most cases parlor network also could not extend beyond local limits. At the beginning of the first phase of liberalization, HLL entered the market through frozen dessert route. Frozen Desserts (which use edible oil instead of milk fat) were technically not reserved for small scale. Amul ice cream, manufactured by the largest milk producing co-operative was introduced in Mumbai market in 1996, intensifying the competition. In 1997, the sector was deserved for small scale, based on the recommendation of the Abid Hussain Committee report, on grounds of hygiene and technology. Removal of licensing restrictions and investment by new players in capacity and market expansion is expected to lead to rapid demand growth in the sector.
SEGMENTATION Ice Cream market can be segmented in three different ways, namely
On the basis of flavours On the basis of stock keeping units/packaging On the basis of consumer segments
On the basis of flavours: the market today has a number of flavours like vanilla, strawberry, chocolate, mango, butter scotch, number of fruit flavours, dry fruit flavours, traditional flavours like kesar-pista, kaju-draksh etc. The market is totally dominated by vanilla, strawberry and Chocolate,
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which combine accounts for more than 70% of the market, followed by butterscotch andICE otherCREAM fruit flavours. MARKET OF INDIA Because of high competition, every company had tried to add new flavours to attract the customers. We can also divide this segment in to sub-segment by 1. Regular flavours (incl. Vanilla, Butter Scotch, Strawberry etc.) 2. Seasonal flavours (Mango, Sitafal, Fruit Bonanza etc.) On the basis of stock keeping units/packaging: the market can be divided into four segments:
Unorganized Sector Cones Dinshaw Cups Dairy Den Take-away Arunor Candies Sticks
Amul Kwality Nirulas Others
Vadilal Havmor Pastonji
On the basis of consumer segments: the market can be divided in to following four segments: Impulse Segment (Pull cart) Retail (Home take-away) Institutional/ catering Parlors While institutional or catering accounts for around 15%, retail and impulse combined take FOR the major with 70% the market. MARKET ICEchunk CREAM IN of INDIA
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MARKET FOR ICE CREAM IN INDIA
Evolution if Ice Cream Market in India Amul, Vadilal, Quality Walls, Dinshaws, and Nirulas etc dominate commercial organized Ice Cream market in India. The market size of commercial ice cream is estimated at Rs. 600 crores. The unorganized local player in Ice Cream industry also has got a market size equally big of Rs. 600 crores. The contribution of fast food and specialty ice cream has fuelled the growth, as more and more people are tempted to consume ice creams. In India, Ice Cream is consumed for taste and as desert. Doctor’s advice Ice Cream after tonsils and people invariably consume if they have problem of acidity. In abroad Ice Cream is considered to be supplementary to food. People abroad are very diet conscious. They have lot of choices in Ice Creams. They have sugar-free Ice Cream; low fat Ice Cream and many other low calorie Ice Creams. We can see from the difference in consumption of Ice Creams in India and vast potential, we have, and an untapped opportunity available. Ice Cream industry is very much synonymous to politics. Politics, because here the regional players are strong, the same way in Ice Cream industry local manufacturers are equally strong players in the market. The Ice Cream market in Gujarat is approximately Rs. 200 to Rs. 225 crores. The Ice- Cream market in Ahmedabad is estimated to be of Rs. 75 crores to Rs. 80 crores from which approximately 50% is organized sector and 50% unorganized sector. In Ahmedabad itself, we have big organized players like Amul, Vadilal, Havmor, and Dairy Den. Equally strong are many local players like Patel
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Ice Cream, Balaji Ice Cream, Rajasthan Ice Cream, Janata Ice Cream, Derani Jethani Ice Cream and various other local manufacturers. Present Trend The Ice Cream Market worldwide is led by the United States, which is the undisputed leader in the Ice Cream Market of the world with highest per capita consumption of 1250 ml. per person. Other leading countries are Italy, Denmark, Germany, United Kingdom and Australia where the per capita consumption of Ice Cream is more than 500 ml. per person. Ice Cream Market in India has been expended impressively over the last decade. The long-term growth potential is very high when comparison is done with the international consumption patterns. The per capita consumption of Ice Cream in India is only 125-ml. per person. The estimated market size is approximately Rs. 5000 crores if we consider the average per capita consumption of the leading countries. The overall Ice Cream market is growing by around 10% annually. The entry of multi-national companies and large co-operatives has improved the growth rate and created better images of the Ice Creams as good as alternative for rich and nutritious food. The Ice Cream markets are basically categorized into commercial packaged Ice Cream (sold through only outlets having Deep Freezers); Premium Parlor Ice Cream (sold through Parlors); Soft Serves parlors (made and dispensed fresh from machines) and artisans scoop Ice Creams.
SWOT Analysis of Overall Ice Cream Market in India Strengths: The strengths of Ice Cream market in India is the availability of natural resources which can be capitalized to improve and increase the market size available. 11
Weaknesses: Many un-organized sector players manufacturing ice creams are not hygiene and quality conscious and they just try to compete on price resulting in unhealthy competition with organized sector manufacturers as well as good unorganized sector manufacturers. Many organized players are thus finding difficulty to maintain and survive in the market as they have high fixed overheads. Opportunities: Looking to the International scenario, Ice Cream industry in India has a huge potential in the untapped market available with us. Ice Creams of various types can be made available to the people at large to increase the consumption. Threats: Due to globalization many Multi Nationals are entering in India with a good financial back up, latest technologies and equally good quality products with attractive pricing and different varieties. This can create problem for Indian manufacturers of Ice Creams if they can’t match their quality and price with them.
General Suggestions to improve Ice Cream Market in India Looking at the consumption pattern abroad and in India we have good potential to expand the market size of Ice Creams in India. The Prime and most important suggestion is to increase the awareness in the people, so that the consumption could increase. The normal psychology in 12
the minds of people is that eating ice creams makes you sick, get you cold or cough. The other thinking is that Ice Creams have a lot of fat contents that could increase weight. For this, if we manufacture Ice Creams with some additional values and promote them in the market with a good registering message to the people, it would definitely increase the consumption on Ice Cream. For example manufacturers could come out with an ADRAK ice cream or ice cream with mint or menthol. Ice Creams with different varieties like low fat ice creams for weight conscious consumers, Sugar free ice creams for Diabetic consumers and so on. The promotions should be made in such a way that people are made conscious to eat more and more ice creams. With the consumption increasing and the cost of production coming down, the same should be passed on to the consumers in different ways by giving attractive gift packs with ice creams or more quantity for the same price. Ice Cream packaging, shapes of ice creams can be made attractive to pull the consumers. In fact, we have a huge untapped market in India looking at the per capita average consumption of the leading countries in the world. If we take average per capita consumption which is 500 ml. then we can have a potential for ice creams to the tune of 5000 crores in India.
MAJOR ICE CREAM PLAYERS The Indian Ice Cream market is dominated by a large number of small local manufacturers and regional players. There are an estimated 150 manufacturers in the organized segment, which accounts for 30-35% of sale of about 2000 units in the unorganized market. In the organized segment, the 13
significant brands are Vadilal, Kwality Walls, Amul, Mother Dairy and Baskin Robbins. Major National Players
Brands
Hindustan Lever
Kwality Walls, Dairy Classic, Max, Cornetto…
Vadilal International
Vadilal, Dairy Fresh…
GCMMF/Other milk co-operatives
Amul, Mother Dairy…
Maharashtra Dairy Products
Baskin Robbins
Other Players: Besides the main national brands, other premium brands have carved a niche for themselves in their respective regional markets. These players have mostly concentrated on the large metro cities. These players sell through franchise parlors as well as through retail stores, groceries, restaurants, hotels, roadside stalls on highways, etc.
Region East
Brands Tulika, Rollicks (Induss Ice Creams)
West Naturals (In Mumbai Only), Pastonji, Dinshaw’s (In Maharashra only),
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Havmor (In Gujarat Only), Yums (In Gujarat Only), Cream Bell (In Rajasthan Only) North Mother Dairy, Nirula’s South Arun (Hatsun Foods), Joy, Nandini (Karnataka Only)
Gujarat is very big market for Ice Cream industry, which is dominated by Vadilal Ice Cream, which has market share of nearly 55% that is followed by Amul and Havmor. Ahmedabad is at 1st rank in highest per capita consumption of ice cream in India. In Gujarat people are also fond of eating ice cream at parlors. In each four main cities and in many medium cities local parlors are also famous. Mumbai has several players such as Nature World, Naturals, Ice-cream Express, Dinshaws etc that are priced at a premium over the Kwality Walls and Amul brands. Arun, promoted by Hastun Foods Pvt. Ltd. is dominated brand in the South. Arun sells its Ice creams through exclusive parlours, which are popular in the southern cities. Joy, another marginal national player has a stronger presence in the south. Together, Joy and Arun have a sizable presence in the southern markets of Chennai and Tamilnadu. Nirulas is the strong local player in Delhi. Mother Dairy the Delhi version of the Amul brand also has a strong presence in the Northern Region.
The competitive structure of the Indian Ice Cream market is as below Brands Kwality Walls Amul
Market Shares (%) 35 30
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Vadilal Others
20 15
Market Shares of Ice Cream Companies in India
Others 15%
Kwality Walls 35%
Vadilal 20% Amul 30%
The above graph reveals that the Kwality Walls is the national number one player having 35% of the total market share. Vadilal is having the 20% market share and giving tough competition to major brands like Kwality Walls and Amul.
Market Share of Ice Cream Manufacturers in Gujarat Brands Vadilal Amul
Market Shares (%) 52 25
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Havmor Others
13 10 Market Shares of Ice-cream companies in Gujarat
Havmor 13%
Others 10%
Vadilal 52%
Amul 25%
The graph shown above depicts that in Gujarat Vadilal stands at the first place with 52% of the market share followed by Amul and Havmor with market share of 25% and 13% respectively. The market share reveals the strong position in the mind and hearts of people.
Market Share of Ice Cream Manufacturers in Ahmedabad Brands Vadilal Havmor Amul Others
Market Shares (%) 35 25 20 20 17
Market Shares (% ) of Ice Cream companies in A'bad
Others 20%
Amul 20%
Vadilal 35%
Havmor 25%
If we see the scenario in Ahmedabad Ice Cream market then we find that Vadilal is at the first position having the market share of 35%. However the number one national player Kwality Walls is having negligible market share.
MAJOR ICE CREAM PLAYERS OF GUJARAT VADILAL A name synonymous to Ice Cream. A company, which is around 78 years old, was started by the founder member Late Shri Vadilal Gandhi.
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His Mission: To provide quality product and services at an affordable price. Vadilal started as a one-man show with hand-cranked ice cream in 1926 as a small retail outlet. Today it has grown to employ around 800 people. The turnover of Vadilal in India has crossed Rs. 100 crores. In Ahmedabad they are the leaders and are selling Ice Creams worth Rs. 20 crores. They have plants at three different locations, one is at Ahmedabad (Dudheswar), the second is at Pundhra, Gujarat and the third is at Barelley (U.P). They manufacture around 90 varities of ice cream with over 160 packs and forms. They have diversified in to processed food, Chemicals, construction and financial services also. SWOT Analysis of Vadilal: Strength: They have a cold chain network at three manufacturing units in India, 12 clearing and forwarding agents, 250 distributors and around 15000 retailers. They have their own refrigerated vans for smoother and faster deliveries. Weakness: Financial constraints due to high overheads and cost of production (electricity). Opportunities: Huge untapped market and the changing and growing consumption pattern. They are having manufacturing units at three different locations and vans for catering the needs of increasing demand in the market. Threats: High Taxes, Multi National companies entering the market and also the increasing number of local manufacturers. Hierarchy at Vadilal Managing Director Rajesh Gandhi 19
General Manager Sales Manager
Product Manager
Senior Manager
Dy. Product Manager
R.S.M
Assistant Prod. Manager
A.S.M. Sales Executive
Prod. Executive
Sales coordinator
Prod. Officer
HAVMOR Havmor Ice Cream started as early as in the year 1944 in Karachi, Pakistan by Chonas. The founder Mr. Satishchandra Chona came to India durind India-Pakistan partition and then started their first larry at Kalupur. Mr. Satish and his wife churned Ice Cream in a bucket at night and then they used to sell it in the morning in larry. Bit by bit they saved money and in the year 1953 they tool a place at Relief road which stands even today.
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Today Havmor has got outlets at many places including Relief road, Navrangpura, Panchvati, and Drive-in and also at many places in Baroda. They have a manufacturing unit at Naroda, Ahmedabad. Their turnover in Gujarat is to the tune of Rs. 22 crores and in Ahmedabad they are selling ice creams of Rs. 10 crores approximately. Their distribution is done through distributor and retail network in Gujarat. They have around 100 different flavours and sizes put together. Their marketing strategy is always consumer oriented and they always have given consumers value for money. Their advertisement and promotion are done centrally through newspaper, hoardings, wall paintings, POP, events etc. SWOT Analysis of Havmor: Strength: They have a strong regional brand with good quality and service back up. They provide their customers value for money. Weakness: Financial flexibility Opportunities: Very large potential to attract the present generation who are now accepting the ice creams round the year, if they find satisfactory prices and unique quality of ice creams.
Threats: High Taxes, very high overhead in terms of electricity and transportation, competition from lots of local unorganized players. Hierarchy at Havmor Managing Director 21
Pradeep Chona Marketing Manager Fin. Manager
Gen. Manager
Deep-freezer Dept.RSM RSM Mktg. Admn. Mgr. Dispatch Mgr.prod. QC MIS ASM ASM
Prod. Supervisors
Executive
Staff
Sales Representatives
AMUL (Anand Milk Union Ltd.) Amul is a brand name of products coming under Gujarat Cooperative Milk Marketing Federation Ltd. (GCMMFL) which is a 2500 crores cooperative concern now. During the British rule Polson had a monopoly in India. Polson used to buy individually from various farmers in Gujarat and Maharashtra at a very low rate and then processed the product to earn heavy profit. 22
Sardar Patel and Morarji Desai got together during that time and then started the cooperative movement. They met the farmers and made them understand the ways British were exploiting them. They made a union and started negotiating with British to give them proper rates. Initially the farmers threw the milk but did not give it to the British. On experiencing the shortage of milk they came to terms with the farmers and then started giving good price to them. Once getting good price for their milk, farmers thought of starting their own processing unit and this is how GCMMFL started. One day the processing unit failed and there was nobody to maintain it. By chance Dr. Varghese Kurien happened to be in Anand, who was an expert in the dairy technology. They somehow traced her out and requested her to come and mend the machine. Dr. Kurien came and immediately repaired the machine. Since there was no technical man, the federation requested Dr. Kurien to join and work for them. This is how GCMMFL started with the leading man Dr. Kurien. They started manufacturing all sorts of byproducts from the access milk like cheese, butter, ghee etc. in 1976 with the help of Dr. Kurien who was a master by himself. From that day onwards GCMMFL never looked back and turned to be a giant worth more than Rs. 2500 crores. In 1996, GCMMFL started manufacturing ice creams. In a very short time it captured a market share in the organized sector to the tune of Rs. 200 crores which is 35% of the total market share in India, and became a market leader. In Ahmedabad Amul is selling ice creams worth Rs. 11 crores and has a market share of approximately 30%. Its major strength is in its manufacturing units and its networks all over India. It has got around 180 distributors in India, 37 in Gujarat and 9 in Ahmedabad. Strategy: Their main strategy initially while launching was low price and high quality product which has made them a success and leader all India. Their pricing policy is all India one price. They come out with at par pricing with the competition. Their marketing is done through distribution channel. They have a variety of 153 types in all sizes, shapes and flavours. SWOT Analysis of Amul:
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Strength: Their main strength is the huge network they have with manufacturing units at various locations all India and the strong financial backup they have. Amul has also started selling ice creams by means of small shops built in municipal gardens, so the reach of Amul is increasing. Weakness: Local unorganized sector giving ice cream at low price without any quality. Opportunity: There is a huge untapped market looking to the per capita consumption with leading countries. Threats: High Taxes, high overhead in terms of electricity and transportation, competition from lots of local unorganized players.
Hierarchy at Amul Chairman (Dr. V. Kurian) M.D. (Mr. B.M. Vyas) 24
A.G.M. (Existing n\w) D.G.M. D.G.M. (East) (West) Depot incharge Officer incharge Executives Sales Representatives
D.G.M. D.G.M. (North)
A.G.M. (n\w Avenues) D.G.M. (South) (Central)
DAIRY DEN Chills Thrills and Frills Dairy Den launched their first ice cream parlor way back in 1969 at Ahmedabad and as a chain of seven-premium ice cream parlors in Gujarat state. Dairy Den’s CTF has the USP of freshly prepared ice creams of International quality having value for money and visual appeal. All their
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parlors are run my management itself having high rated homogenous quality with high hygiene standards. The CTF operations are carried out under the name of Dairy Den Kiosk Ltd. The brand is one of the major players in Indian Premium ice cream segment. CTF plans to have its presence in all cosmopolitan towns in India and expand their parlors to 40 by December 2002. Dairy Den: Caters to high and low income class under two brands as under. 1) CTF Premium Ice Cream parlors At present CTF operations consists of seven premium ice cream parlors in Ahmedabad, Gandhinagar, Baroda and Surat. The company is planning to open a new parlor at Delhi, Jaipur, Pune and Agra, which are already under process. 2) Yums- Soft Serves Dairy Den is engaged in setting up business of Yums Kiosk Parlors. This is the unique concept introduced by them and has been a run away success. The company is selling soft serves under the brand name of Yums at a very low price making it affordable to all the sections of the society. This concept has received a tremendous response from the market. And currently there are 180 Yums outlets in the country. CTF Products: Artisan Scoop Ice Creams, Soft Serves, Sundaes, Juices, Thick Shakes etc.
SWOT Analysis of Dairy Den Strengths: 1. Pioneers in bringing soft ice creams and freshly prepared artisans scoop ice creams to Indian market
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2. Media coverage and promotions handling by leading advertising agency Mudra. 3. It has its own managed parlors and hence can have a good control over quality of product. Weakness: Cost of production is high as the volumes are low. Opportunity: Untapped market on a national level in premium ice cream segments with few players in it. Threat: 1. Local low priced ice cream manufacturers. 2. Government levies and controls.
Hierarchy at Dairy Den Management of Group Promoters: Mr. Harish Shah and Mr. Bharat Shah Board of Directors
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G.M.HRD G.M. (Co. Secy.) (Finance) (Technical)
G.M. (Mktg.)
G.M. G.M. G.M. (Parlor Op.) (Accounts)
Dairy Den Kiosk Ltd. Mgmt. B.O.D. G.M. (Parlor Operations) Regional
B. Develop & Plan Exe.
Manager
Co.-ordination
Asst. Mgr. Bus. Dev. Officer QC Supervisors Operational Staff
VARIOUS LOCAL ICE CREAM MANUFACTURERS There are various unorganized and local manufacturers in India who manufacture ice creams by old methods by wooden or metal kothis or having a locally made machine for making ice creams. These local or unorganized sectors cannot be overseen as they have an equally big turnover in India to the tune of Rs. 600 crores. They have an advantage of less 28
overhead and strong local brand loyalty. Their pricing is very competitive as their overheads are less and are fighting big organized players in India. The locally manufactured ice cream has got more weight as compared to machine made ice cream. The machine made ice cream has generally got more air in it. In Ahmedabad the unorganized local players are selling ice creams worth Rs. 40 crores. The leading names in the unorganized sector are: • • • • • • •
Patel Ice Cream Balaji Ice Cream Asarfi Ice Cream Rajasthan Ice Cream Derani Jethani Ice Cream Janata Ice Cream And many others. SWOT Analysis of Local Manufacturers
Strengths: 1. Local players with few overheads and can give value for money. 2. Loyalty and continuity of their clients Weakness: 1. Local hand made machines and hence no control over quality. 2. As it is made by Sancha the time taken is more 3. The weight of their ice cream is more as air content in ice cream is less and hence costlier than the machine ice cream.
Opportunity: Due to changing trend and increasing market sizes, they can capitalize the niche market by giving good product at low price. Threats: Organized players with good network, financial and promotional backup and with volumes are making cost effective products now and the gap has 29
narrowed down between the prices of organized and an unorganized sector. Consumer would be tempted to go for an organized and a branded product.
PROMOTIONAL STRATEGIES Promotional Assistance Provided By The Manufacturers In Gujarat
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The promotional assistance provided by the manufacturer has improved and increased as compared to three years before scenario. The promotional assistance is given to the distributors to deliver the same to the dealers. The posters, glow sign boards, posters for newly launched flavours or schemes, wall paintings are provided to the dealers at the beginning of their business. The same is supplied, even whenever demanded by the dealers themselves. Thus the supply of such POP displays have been done free of charge to all the dealers, but some times too many small dealers may not be given all the available promotion as depending on his sales. The promotional assistance also depends upon his sales. The promotional assistance also depends upon the annual sale of a dealer, the location of his shop and the market he covers. Promotional Measures Taken During The Year: 1. Schemes introduced by Havmor: Scheme throughout year: Purchase Ice Cream Free Ice Cream Bonanza (1000 ml) Pista (1000 ml) Butter Scotch (1000 Vanilla (1000 ml) ml)
Price (Rs.) 100 100
Scheme for Diwali Festival: o Madhumalti Ice Cream + Asean company’s 4299/(1000 ml) Container Tiffin box
=Rs.
2. Schemes introduced by Amul: o Amul has introduced the Combo Pack schemes to attract the consumers against the competitors. The schemes are as under:
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Combo Pack Santra Mantra + Vanilla Fruit Bonanza + Vanilla Alphanso-Mango + Vanilla Butter Scotch + Vanilla
Price (Rs.) 100 100 100 100 Flavor contains 900 ml each
o Amul was selling the Vanilla Party Pack (900 ml) at just Rs. 40 and Party Packs (900 ml) of Kaju Draksh and Butter Scotch at just Rs. 60 each. (NOTE: Promotional scheme of Vadilal is explained later) EFFECTS OF SCHEMES ON SALES: The disturbed situation in Ahmedabad since last 3-4 years plays a major role in decreasing the sales. But due to introduction of schemes, the sales have been maintained and supported remarkably. The schemes have increased the sales to a considerable level that has benefited all the intermediaries. Increase in Sales Year 2001-2002 2002-2003
Sales Average/ below Average Increased by 50%
CURRENT MARKET OUTLOOK
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The competition among HLL, Vadilal and GCMMF is at National level. But where the Vadilal has major share in Western region the Vadilal has direct competition with GCMMF. Stiff competition has started between the leading players, starting the price war by giving heavy discounts on its cones and by launching lower price segment products. HLL too has launched a range of ice creams for lower price segment and has clearly segmented the market based on the age. HLL has taken over direct control of ice cream manufacturing in the eastern and western regions, increased cold chain distribution by innovative channels like mobile vending and has launched new brands in the market. While GCMMF with its advantage in milk procurement and competitive pricing is strengthening its position in the market by tying up with the cooperatives by expanding its network, HLL has advantage of vast portfolio of brands from its parent. Moreover, HLL too is experiencing new innovative concepts for increasing the reach of its ice creams. Amul on the other hand has gone national with setting up of proper cold storage facilities and transportation facilities in the eastern region of the country. Meanwhile the company also talks with Vadilal group for acquiring its ice cream manufacturing facility in Bareilly. Vadilal try to compete with heavy- price discount and by improving its product range. Now a day the Vadilal has 250 different flavours. Vadilal is the initiator of the scheme of BUY 1 GET 1 FREE in Party Pack and Cup category, which leads hot competition in cold market. Vadilal has also started parlor chain to attract premium segments. The market has seen a number of international players like Movenpick, Baskin Robbins, Blue Bunny etc. launching their products in the country. Players like Blue Bunny, which is presently importing its ice cream for its markets in Delhi, and surrounding areas has expanded its presence to Western region. The company has plans of setting ice cream parlours across the country.
Consumer Awareness and Penetration
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Low income, high prices, non-availability of good quality products, poor distribution infrastructure and low investment in marketing has all resulted in one of the lowest per capita consumption of ice cream in India at 106 ml per annum. Per capita consumption of ice cream in other countries is as follows: Country
Per Capita Consumption (Liters p.a.) 22.0 18.0 14.0 12.0 5.0 1.8 1.8 0.4 0.3 0.11
USA Australia Sweden Norway UK Thailand Indonesia Pakistan Sri Lanka India
Ice Cream penetration at all India level is estimated to be 14%. The penetration is understandably higher in large metros at 29% compared to 2425% in small/medium towns. The same in rural areas is low at 9.5%. In rural areas, kulfis/ ice cream made by small cottage industry is popular. The market for organized sector is restricted to large metropolitan cities. In small towns and villages, there are thousands of small players who produce ice cream/ kulfis in their home backyard and then cater to lower market. Almost 40% of the ice creams sold in the country are consumed in the western region with Mumbai being the main market, followed by 30% in the north and 20%in the South. The eastern region has the lowest consumption level at 10% of national consumption. The main reason behind low penetration in eastern region is the poor infrastructure facilities and lack of cold storage chains in the region. General Consumer Habits And Practices Ice Creams are primarily impulse purchase products and they are not yet accepted as snack food or part of daily or frequent consumption
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habit. It remains once in a while indulgence. Retail displays, fun/excitement positioning etc. plays a crucial role in purchase decision. For impulse purchase budget, Ice Creams competes with other impulse products such as soft drinks, chocolates, confectionery etc. therefore, higher share of voice of soft drinks has an adverse effect on the Ice Creams demand. While most consumers have liking for one or two flavours, they frequently try out new flavours. Vanilla, Strawberry and Chocolates together accounts for 70% of the volumes. Ice Creams are extremely likable product by all age groups. Claimed penetration of ice creams is as high as 96%. Most consumers claimed to have consumed ice cream however actually do not consume, mainly due to price barrier. There is a strong resistance among Indian parents about ice cream consumption by children, and a misconception that it can cause cold or other illness. This is largely due to the fact that most ice creams manufactured by local/unorganized sector are of poor quality. Cold/other illness is caused by bacteria/germs and not by the cool temperature of the product. All age groups consume the product. However, people below 25 years age group account for 80% of the consumption. In relative terms, consumption is lower among older people in India. Ice Creams are generally consumed in the evening, after dinner in India. The consumption during daytime is extremely low. There is a significant seasonality in ice cream consumption in India. Consumption goes down significantly in winter to about 40% of average consumption in the North and 60% in West and South. Home consumption is restricted due to poor quality of in-house refrigeration. As penetration of 2-door refrigeration is limited, ice cream cannot be stored in proper condition for long time in single door refrigerator. Consumption of branded ice creams manufactured by organized sector is restricted to metropolitan cities and other towns. The organized players have not been able to extend their distribution chain to small villages and small towns, due to small size of market and nonavailability of cold chains. Presence of unorganized sectors and unbranded products is quite high in rural and semi urban areas. The unorganized sector mainly sells 35
frozen milk candies (kulfies). Quality of product is inconsistent and is often un acceptable hygiene standards. In urban areas also, there exists a large unorganized sector but quality of product is relatively better. A large part of catering market in urban areas is catered to by the unorganized sector. Reasons for low consumption of Ice Creams in India: • In India there is a strong tradition of eating sweets. And hence the availability and popularity of substitutes in terms of milk sweets and other sweets. • Ice Creams has not yet entered in Indian consciousness as a oral gratifier and have not formed part of the consideration ser of an average Indian. • Ice Creams are not acceptable as item of consumption for all the age groups. There is a strong perception that ice cream is a childish product. The perception is that people grow out of ice creams in to eating sweets. • Feeling of guilt is strange in parents who eat ice cream, especially when they are alone as the feeling is that they should eat when only when their children accompany them.
COMPANY PROFILE
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About Vadilal Group Started by the late Shri Vadilal Gandhi, Vadilal today is a name familiar in practically every Indian household. Vadilal Group had its humble beginning, more than 95 years ago. The name has become synonymous with Ice Creams. Though, ice cream still remains the core business, over the last few years processed and frozen food products have assumed great significance in the scheme of things. Today Vadilal group is in diverse businesses like Processed Foods, Chemicals and Speciality Gases, Forex Advisory Services. Head Quartered in Gujarat, the most industrialized State in India, the Group had a turnover exceeding Rs. 1500 million in 1998-1999 major companies of the group are listed in the stock exchanges of India. The group has a large investor base and its brand name ‘Vadilal’ commands an excellent equity. The Vadilal philosophy of providing its customers quality products and services at affordable price has resulted in the brand being a household name in India. Processed Foods Division: Vadilal entered the Horticulture Processing Industry in May 1991. The best way to ensure total quality is to exercise total control right from the raw material stage onwards. That’s exactly what Vadilal does. Selected fruits and vegetables are grown under the company’s guidance in South Gujarat – the important ‘Fruit Bowl’ of India. It is in close proximity to the Alphanso Mango region. This is where the manufacturing plant is situated. This plant at Dharampur is a modern unit with a well-equipped laboratory for product development and microbiological testing. Keeping in view the tremendous export potential for the processed foods Vadilal has set up manufacturing unit having an installed capacity of 5,400 tons per annum.Vadilal is a registered Indian supplier to international mega brands. The products are exported to Europe, USA, Middle & Far East and South East Asia. Vadilal is the leading producers and exporters of mango pulp in the country. Vadilal has installed an automated line from Mather & Platt for washing, depodding, inspecting, metal winnowing, blanching and cooling fruits and vegetables. Their slicing and dicing is done on imported machines. In order 37
it preserve freshness and enhance shelf life the food is processed using ‘Individually Quick Frozen’ (IQF) technique. This technology has been imported from Eurotek engineering limited, UK and it involves fluidized belt type continuous freezing. It can process two tons of material per hour, and it provides the flexibility of freezing at varying depths for different durations. It has all been worth the effort, considering that M/s. Underwriters Laboratories Inc. has awarded the ISO 9002 certification for quality system. Vadilal was also awarded the certificate of merit for excellent export performance by APEDA (Agricultural and Processed Foods Export Development Authority). Among IQF vegetables the range includes, green Peas, Sweet Corn, Okra, Mixed Vegetables et al. The IQF Fruits range has exotic varieties of the famous Indian Mangoes- Alphonso, Kesar, Totapuri in pulps, slices, cubes in addition to strawberries, Sapota and other ready to eat foods and condiments also from apart from Vadilal’s formidable range. Forex Advisory Services & FFMC Division: Vadilal ventured into this segment in April 1996, offering non-banking financial services. The main activities are: Forex advisory & Forex Exposure Management to Importers and Exporters. Bullion informative Service on Gold Silver--- A complete useful guidance to bullion traders, importers and jewelers. LME-Metal informative service bin base and Scrape metals. A complete useful ‘guidance and information to metal traders, importers, and Metal scrap indenting agents. RBI authorized full-fledged moneychanger –FFMC related transactions: Sale/Purchase of foreign Currency and Traveler’s Cheque.
Construction Division:
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This venture was launched in 1994. Here again, Vadilal gave a lot of attention to the two things that matter most in real estate projects one the assurance of sound construction using only the best available raw materials and two timely completion of the projects undertaken. Vadilal has developed corporate complexes. The office buildings have been designed to offer maximum flexibility in space planning. This takes care of individual needs of office automation and communication. In addition, Vadilal have also kept comfort and convenience in mind. Strategically located in central business districts of Ahmedabad, these complexes are corporate communes for the success driven enterprises. Vadilal Chemicals Ltd.: This division started in 1970, deals mainly in industrial gases and chemicals. The main products are gases such as Argon Nitrogen, hydrogen and Oxygen, Speciality gases, Industrial gas mixtures, Calibration Gases, Anhydrous and Liquor Ammonia. Vadilal is one of the biggest bottlers of Anhydrous Ammonia. Vadilal Chemicals Ltd. has over 2000 industrial customers. To serve them, there is a marketing network of twelve branches and eight dealers, a fleet of 50 cryogenic/liquid transport tankers & commercial vehicles and 25,000-gas cylinders- one of the largest networks for industrial gases in western India. Ice Cream Division: Vadilal the name conjures up the images of ice cream laden bowls and a plethora of new flavours. Starting from one man show with a hand cranked machine in 1926 as a small retail outlet, the ice cream division now has a production capacity of one lakh litres per day at three sophisticated plants, located at Ahmedabad, Pundhra and Bareilly. These these ISO 9002 certified plants for Pundhra and Bareilly are established in such a way that they are in consonance with the market expansion strategies of the division. Vadilal offers the widest range of ice creams and frozen desserts (above 220 Stock Keeping units) in the country in packs including cups, party packs, family bricks, dollies, cones and candies. Something for all taste, preference and budgets. To meet with the consumer demand on regular basis, Vadilal introduces new flavours for different segments of customers throughout the year. People eagerly await Vadilal’s new introductions. Creativity is at forefront in all the activities. Innovations: 39
Vadilal was the first ice cream manufacturer company to introduce Dairy Fresh ----- natural ice cream with pure natural goodness of milk, fruits and nuts, with no synthetic additives and preservatives. Vadilal was the pioneer in manufacturing a biscuit cone which remains crisp to the last bite, unlike the traditional one that tends to get soggy, before one is even halfway through. Vadilal has launched Ice-Mithai, an assortment of traditional Indian sweet in Ice Cream form, which otherwise had to be bought just prior to consumption and that too from vendors whose quality often left a lot to be desired. Vadilal’s King Cone and One-up Chocobar – all time favourites have today attained generic status. Other hits are Chowpati Kulfi, Cassata and Ice mithai. Vadilal still dictates the ice cream market with its innovative offers – “Khao Khilao”(Buy one get one Free) being the latest to hit the market. Other players have also followed suit. To match its unique products, Vadilal has also gone for unconventional and creative packing. As a part of this Vadilal introduced filled Pineapple, Mango and Sweet Lime Ice Cream in the intact skins of fruits. To mark the occasion of the expansion of their ice cream manufacturing facility at Pundhra, Vadilal created India’s largest ice-cream sundae by breaking its own record in Nov.2001. The largest sundae was made using 4950 litres of ice cream, 125 kilograms dry fruits, and 255 kilograms of fresh fruits and with 390 litres of chocolate and strawberry sauces. 180 men took exact sixty minutes to create this record-breaking ice cream sundae. The length of ice cream was 20 ft. and height was 9 ft. Vadilal’s ice cream manufacturing facility at Pundhra is one of the most modern in country. With an eye on the export market the company is maintaining hygiene as per international standards in procuring milk directly from the farmers to improve the microbiological quality. A wide range of products in all segments like premium ice cream, regular ice cream and frozen desserts are
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being manufactured at this plant. Vadilal’s Bareilly and Pundhra plant has been awarded the coveted ISO 9002 accreditation and HACCP certification. Vadilal has one of the largest cold chains of network in the country comprising about 19 C&F Agents, nearly 350 distributors and 22,000 retailers. The network is kept alive by a large fleet of refrigerated vehicles. Refrigeration equipments and retail freezers are sourced from world leaders in the technology so as to deliver the quality products to the consumers, which is a commitment at Vadilal. A large number of imported and indigenous deep freezers have also been placed in the market thereby enhancing the retail network. Most of the machines are imported from Denmark, Germany, Italy and USA. Also Vadilal has set up a chain of Happinezz Parlours- ‘Ice cream Boutiques’ to make it convenient for the customers to relish the complete range under one roof. It has been a hit with the ice cream lovers across the country. Vadilal has 20% of the Indian Ice Cream market as its share. But that’s no surprise considering that the group has the largest range of ice creams in the country in a variety of flavours, packs and forms. The group has a product matrix of over 200 SKUs comprising of cones, cups, candies, family and party packs and bulk packs. Vadilal introduced the concept of “flavour of the month” under which the company develops and markets one new flavour every month for its customers delight. Thus Vadilal has become a well-known brand covering a diverse range of products and activities with a straightforward mission: “ To Provide quality products and services at an affordable price. “
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ORGANIZATION STRUCTURE OF VADILAL Vadilal is mainly divided into two parts: VADILAL
VIL Vadilal Industries Limited
VEL Vadilal Enterprise Limited
VIL: Vadilal industries limited are one part of Vadilal, which is manufacturing division of Vadilal. Along with manufacturing, it also looks after the Quality Control, research and development, Dispatch, and storage related activities. VEL: The Vadilal Enterprise Limited has performed the Sales and Marketing related activities. VEL is liable to handle the relationship with the C & F agents (Clearing and forwarding agents), distributors and Dealers.
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Organization Structure Of the Sales Department General Manager (Sales and Marketing)
Senior Sales Manager
Regional Sales Manager
Dy. Regional Sales Manager
Area Sales Manager
Sales Executive
Joint Sales Executive
Sales Coordinator
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Responsibility Functions And Authority Of Individuals At Different Hierarchy Levels General Manager’s Responsibility and Authority: • • • • •
Sales Administration Advertising and Media Product Management Recruitment and Selection at higher Authority Level Designing Sales promotional programs.
Responsibilities and Authority of Senior Sales Manager, Regional Sales Manager and Area Sales Manager: • • • • •
Generate Sales Assigning targets to SE, JSE and SC Recruitment Maintaining relationship with Distributors and C & F Agents. Assisting in designing of Promotional Programs.
Responsibilities and Authority of Sales Executives, Joint Sales Executives and Sales Coordinators: • • • • •
Appointing Distributors/Dealers Provide Machines Handling Dealer/ Distributor complaints Give the promotional tools to the Dealers and Distributors Dealer/Distributor Communication
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VADILAL’S HAPPINEZZ PARLOURS Vadilal introduced exclusive ice cream parlours under the name “Happinezz Parlours” to meet the expectations of the valued customers. Happinezz provides cozy, nice and cool ambience where one can enjoy world-class ice creams, ice cream sundaes, shakes and other various ice cream concoctions to the heart’s content. Presently Vadilal has 23 such parlours in India and it expects to increase its number very soon. To open a Happinezz Parlour following requirements have to be met: Operational Requirements A place at a prominent location with atleast 15’ frontage and atleast 400 sq. ft. area reserved for ice creams only. Minimum two-display dispensers-one storage deep freezer unit and one soda fountain freezer unit as equipment are required. Proper space for sitting or standing for serving ice creams. Inside parlour walls should be clean and may have product display to enhance the general mood and give feeling of excitement. Translate of products with their prices and attractive photograph should be displayed properly to create the right ambience in the parlour. Happenings New Launches •
•
Recently the group has launched Fresh Fruit Ice Cream with ripples under the Fantasy range viz. Black Current Dolly, 10 Rs. Sundaes (Chocolate, Strawberry, Mango) Company has introduced scheme of Kaju-Draksh cup (1+1) and Bomber and Mango Dolly in just Rs. 15.
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Future Planning Initially the company was dominant player in Gujarat and Rajasthan only, but now because of stiff competition and market situation of these particular regions, the company has decided to increase their market share in northern region of India as a part of strategy to be leading player in the Indian Ice Cream market. Company is also planning to increase their market share in Bihar, M.P., Chattisgadh and Orissa.
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SALES RELATED MARKETING POLICIES
Sales related marketing policies include the following:
Product line Promoting Measures Taken By Vadilal Pricing Policies Marketing Channel Distribution Intensity Types of Power in Channel • Product Line Of the Firm
Vadilal offers two types of Products. One is Ice cream and another is frozen desserts. Vadilal has the maximum range of ice cream products in India i.e. over 200 SKUs. It has preferences for tastes as per budgets. There are rich creamy ice creams for the connoisseurs and low fat frozen desserts for the health conscious. There are plain favorites, chocolate ecstasies, romantic ripples, nutty delight, and fresh fruit fantasies and are guranteed to spark your taste buds. Vadilal has priced its products on the principle of real value for money. Product range offered: Cones, Candies, Cups, Family packs, Party packs, Bulk packs, Chocobar, Juicees, Candies in 3 flavors, Sundaes, Kulfies, Frozen Deserts, Fresh Delight fruit Ice cream, Ice cream pizza, Dairy Fresh.
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Quality: At Vadilal, commitment to Quality is an Attitude. Vadilal Ice Creams contains only the best ingredients, be it cashew nuts, almonds, pistachio chocolate or fresh fruits. Great pains are taken to find the finest ingredients from around the globe. State of the art technology ensures that each scoop is dense, rich and filling, with no extra air of ice flakes. Special care is taken during packaging, storing, transit and delivery so that consistency in quality is maintained. This is why when the end product reaches the customer, he is convinced that quality shines through in everything the group does. • Promotional Measures Taken by Vadilal During The Year Vadilal has run promotional schemes throughout the year. Different promotional schemes for Customers, Dealers and Distributors are as below. Promotional schemes for Dealers: Vadilal had offered scheme for purchasing of Deep Freezers for dealers on occasion of Diwali. Company
Capacity
Price (Rs.)
Western/Carrier Western/Carrier Voltas ( 3 Doors)
300 ltrs 400 ltrs 400 ltrs
19,000* 23,000* 24,000*
Free Ice cream (Rs.) 5,000* 6,000* 5,000* *Condition applied
Promotional schemes for customers: 1) One scheme, which Vadilal is running for the entire year, is offering ‘ComboPack’. Combo pack is the package of two Party Packs. Customers are getting two party packs by paying price for just one party pack. One party pack is absolutely free. Vadilal get tremendous response of this scheme and that is why they have decided to run this scheme for the entire year. Under this scheme sometimes Vadilal offers two different flavors at price of one.
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For example: Purchase Ice cream Free Ice cream Vanilla Vanilla Kaju-Draksh* Kaju-Draksh* Butter scotch* Butter scotch* Fresh Strawberry* Fresh Strawberry* Fresh Litchee* Fresh Litchee* Black Current Strawberry* Fresh Sitafal Real Vanilla* Swiss Cake Chocolate sundae* Khandala Special Mango Ripple* Fresh Orange Fresh Mosambi* Fresh Mango* Fresh Mango* Fresh pineapple* Fresh pineapple* Above party packs are available in 900 ml * Frozen desserts
Price (Rs.) 70 100 100 100 100 100 100 100 100 100 100 100 and Sundae is 500 ml
2) Vadilal had launched ‘Diwali Special’ scheme. Under this scheme vadilal had offered two choices to the customers: PanchRatna Ice cream + Cello’s hot lunch Tiffin = Rs.225/Rs. 140/- (900 ml) + Rs. 285 = Rs.425/Badam Bahar Ice cream + Milton’s 4 container set = Rs. 125/(900 ml) 3) Chocolate Sauce with Vanilla: The consumer scheme of 50g chocolate Sauce Free on Purchase of one litre party pack of Super Vanilla became a Trendsetter scheme in the market. The response to this offer was enormous. Promotional Tools: 1) Promotions only through paper advertisements such as in daily news
papers. 2) Promotions provided to dealers through Wall painting, Freezer painting, Hoardings, Acrylic boards. Glow sign boards, Attractive boards for the newly introduced flavors schemes.
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• Pricing Policies Of The Firm The pricing policies followed by the Vadilal are as below. 1) Policy on pricing relative to costs:
Vadilal follows Full Cost/Cost Plus pricing, for the states where their manufacturing plants are situated. Under Full Cost pricing, no sale is made at a price lower than that covering total costs, including the variable costs and allocated fixed costs. For Example: X X+Y X+Y+6%
Cost of production Cost of goods sold to VEL Cost of goods sold + Distributor’s Margin X+Y+6%+(12%to20%) Dealer margin added to above =MRP (Consumer Price) 2) Geographical Pricing:
Vadilal charges extra penny as Geographical Pricing from the states where the manufacturing plants are not located. Here, the margin of C & F agent is added to the MRP of the Ice Cream. Also the distribution cost is higher for such states so these states have to pay somewhat higher charges for the Vadilal Ice cream. For Example: X+Y+Z Cost of goods sold + C & F agent’s margin X+Y+Z+6%+(12%to20%) Cost of goods sold + C & F agent’s margin Distributor’s margin + Dealer’s margin
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• Marketing Channel Channel Strategy
MANUFACTURE
VIL
C & F AGENTS
DISTRIBUTORS VEL LLL
DEALERS/RETAILERS
CUSTOMERS
The above channel strategy defines the channel members and whether they are part of VIL or VEL. As shown the Manufactures and C & F agents are handled by the VIL whereas serving the Distributors, Dealers and Customers are the responsibility of the VEL.
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• Distribution Intensity There are basically three types of distribution intensity. Selective Distribution: Selective distribution means selecting only
those outlets/retailers that can best serve the manufacturer’s interest. Exclusive Distribution: Exclusive distribution means distribution of
manufacturer’s product or products within particular area is to be confined solely to the retailer/outlet with whom the manufacturer has made written or oral agreement of distributing the product\products. Intensive Distribution: The manufacturer following the policy of
mass distribution or intensive distribution aims for maximum sales exposure by securing distribution through all those outlets from which customers might expect to purchase the product/products. Vadilal has adopted the intensive distribution to have maximum sales by availing Ice cream at the nearest location to customers. This way Vadilal is getting maximum business. The manufacturer using this distribution strategy needs several marketing channels. The channel strategy followed by Vadilal is shown on previous page.
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• Types Of Power In Channel Relationship Vadilal is using Coercive Power with dealers. Vadilal forces dealers,
to not to keep other brand’s ice cream in their freezers. Vadilal uses Reward Power, to offer intermediaries (C&F agents,
Distributors, Dealers) extra benefits in the form of incentives, discounts, tours etc. for achieving targets and for better performance. Vadilal uses Reward Power, to customers by providing attractive
product offerings like free schemes. Vadilal uses Expert Power in developing new flavors of Ice creams
and that way to help Dealers/Distributors for better sales. Vadilal has very strong brand image in the Ice cream market. People
are getting good reference from customers. This way it uses Referent Power.
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Sales Budget and Assigning Territories It includes the following: Sales Forecasting and Devising Budget Assigning Territories Sales Forecasting and Devising Sales Budget: As Ice cream is perishable good and it is require proper freezing to maintain proper quality, which is very costly. So sales fore casting is very important to reduce the cost of over production and maintenance. Vadilal considers following factors for forecasting the Sales: Observing Market Trends Past figures related to consumption pattern Deciding the future strategy Using the above factors, Experts in the sales field use their expertise and give their opinion for the next year’s sales. Thus Vadilal use ‘ Jury of Expert Executive Opinion’. After deciding the Sales forecast, they are devising the Sales Budget. They allocate budget for promotional schemes, for incentives to the sales people, advertising etc. Assigning Sales Territories: Vadilal considers factors for assigning sales territories are as under: Market Potential Future Growth Vadilal has decided 13 different territories for their operation. 1) Gujarat ⇒ Central ⇒ South ⇒ North ⇒ Saurashtra 54
2) Rajasthan ⇒ Udaipur ⇒ Jaipur ⇒ Jodhpur 3) Madhya Pradesh 4) Utter Pradesh ⇒ Eastern U.P. ⇒ Western U.P. 5) Uttaranchal, Dehradun 6) Delhi 7) Haryana 8) Punjab, Chandigadh, Himachal Pradesh 9) Jammu & Kashmir, Nepal 10)
West Bangal
11)
Orrissa
12)
Chattisgarh
13)
Tamilnadu
14)
Bihar, Jarkhand
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LOGISTICS SYSTEM The major areas under the Logistics System are as follows: Warehousing Order Processing Inventory Transportation Warehousing: As Ice cream is a perishable product and it must be kept in cool place to maintain its quality for few days, Vadilal has Cold storages at different ends. These ends are Factories, C& F agents, Distributors and Dealers. The temperature kept in these storage houses is as low as -25 degree centigrade. Order Processing: Vadilal has defined MOQ (Min. Order Quantity) for the distributors to make order to the company. As far as order of the dealers are concerned that is the headache of the distributors. Here, the job of the Vadilal’s sales staff is to assist the distributors in selling the Ice cream. Vadilal is having MIS system installed in the organization. MIS helps Vadilal to know the status of a certain Distributors. Inventory: For the raw material Vadilal keeps the inventory and do not follow the exact JIT. The inventory of the packaging material is kept as low as possible and according to the demand forecasted and growth rate of the market. Ice cream is product of Impulse category that requires proper storage, to keep it in a proper condition. The production and consumption system also such that, the production is done through the whole year and main demand is in summer season. So every company has to store Ice cream properly. Company has enough storage facility at their all plants, and all C&F agents have their own cold storage, so they keep the stock as per their requirement i.e. at the time of promotional scheme period or in summer they maintain high stock, the C&F agent carry the stock in bulk and they supply the Ice cream to distributors or dealers, who also have proper freezing facilities.
Transportation:
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Ice cream requires very low temperature in terms of -25 degree centigrade, so the Van used for the transportation is having the chillers. Company is RESEARCH WORK acquiring Van on the contract basis.
1. PROBLEM STATEMENT First Step in marketing research is clearly state the problem statement, which is stating the management dilemma, its background, its consequences and the resulting management question. The study was conducted to know the consumption pattern of ice creams in Ahmedabad city for Vadilal Ice Creams. The research was exploratory in nature and quantitative research tools have been used for data analysis that had been collected from the survey of the consumers who eat ice creams. 2. RESEARCH OBJECTIVES To study the overall consumption pattern of ice creams in Ahmedabad city. To know which type of ice creams are preferred by the people, which includes the sub objectives like branded or unbranded, which flavour, which type of ice cream serving etc. The Research also focused to know the frequency of consumption of ice creams and the price tag generally opted by the people. The Research also tried to find the effect of advertisement of ice creams, the media and the brand mostly recalled by the consumers. 3. IMPORTANCE AND RELEVANCE OF STUDY All industries are facing competition today, and so is the ice cream industry, which is fast growing. In Gujarat, especially there is stiff competition amongst the players like Vadilal, Amul, Havmor, DairyDen, and also the local manufacturers of ice cream.
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The main aim of my study is to study the consumption pattern of ice creams in Ahmedabad city, which is a part of consumer behavior and consumer research on the whole. As the market today is consumer driven, it is very important to know their likings, preferences, and their perceptions. The result of this project would be useful to Vadilal to know the consumer taste and preferences for ice creams, the effect of their promotional activities and designing a better strategy if needed for further improvement. 4. RESEARCH DESIGN i. Approach My research approach was quantitative in nature. This means the data collection was done through the survey and the data thus collected was subjected to rigorous analysis. The approach can be further called inferential approach, as the purpose was formation of database from the collected data and to infer the characteristics of the population from it. ii. Data Sources The various sources of information that can be used are: Primary and Secondary data sources. I was mainly used the primary data i.e. the rely given by the respondents, to substantiate the findings and to have idea of overall consumption pattern of ice creams. However, I also have used the secondary data gathered from information provided by the company, Internet, library, newspapers etc. iii. Research Instruments for Data Collection Marketing Researcher has a choice of two main research instruments for collecting primary data questionnaires and mechanical devices. Here the use of Questionnaire has been made for data collection, which consists of a set of 20 questions presented to the respondents for their reply. For the study formal format of the questionnaire was prepared by me under the guidance of Mr. Keraleyan, product manager and Mr. Jignesh Shah, his assistant. The questions included were mainly closed ended. The draft was prepared and the final draft was operated over 150 respondents of the different areas of Ahmedabad. 58
Questionnaire TO STUDY CONSUMPTION PATTERN OF ICE CREAMS IN AHMEDABAD We are doing a survey on consumption pattern of ice creams: We would be grateful if you could spare a few minutes to fill up this questionnaire.
Name of the Respondent: _________________________________________________ Address _________________________________________________ (Only Area) (Tick the relevant below) Q-1
Sex Male
Q-2
Age <20
Q-3
6-10
11-15
>15
Secondary
Graduate
Post Graduate
Service
Business
Professional
To have ice creams do you generally, Go out
Q-7
>40
Occupation Student
Q-6
31-40
Education Primary
Q-5
21-30
Number of Family Members <5
Q-4
Female
Bring ice-creams at home
You go out to take ice creams generally with
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Both
Family
Q-8
Friends
How frequently do you consume ice creams? (Weekly) <2 times
Q-9
Alone
2-5 times
above 5 times
In a day, when do you generally consume ice cream? Morning
Noon
Evening
Night
Q-10 How would you like your ice cream to be served? Cup
Cone
Candy
Scooped
Sundaes
Party/Family pack
Q-11 Which price tag (Rs.) are you comfortable with while purchasing ice creams? (Put ‘X’ in suitable range) Cup
5
10
15
20
Cone
5
15
25
35
Party Pack (1000 ml)
50
90
130
170
Family Pack (500 ml)
50
70
90
110
Q-12 Which flavors of ice cream do you like the most? (Rank in order of preference – like most give rank 1 ----) Vanilla Kaju-Draksh
Kesar-Pista
Chocolate
Butterscotch
Seasonal/Fruit flavors
Other (Specify) ________________________________________________ Q-13 Please indicate how much importance do you give to the following factors while buying ice creams? Extremely Not at all Important Important
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Brand Price Schemes Flavour Quality Availability
5 5 5 5
4 4 4 4
3 3 3 3
5 5
4 4
2 2 2 2
1 1 1 1 2 1
3 3
2
1
Q-14 Can you recall any advertisement of ice cream? Yes Advertise: ___________
No
Q-15 If Yes, Please tick the relevant ones out of the following: Newspaper/Magazines
Television
Hoarding
Other (Please Specify)_______________ Q-16 You remember the advertisement because (tick the relevant) It impressed you
You saw it many times
It had good music
Other (Specify)____________
Q-17 You generally prefer ice cream that is Branded
Unbranded
Q-18 Which brand of ice cream do you consume most? Vadilal
Amul
Dairy Den
Havmor
Other (Please Specify) _______________________________________ Q-19 How many schemes are you aware of? Vadilal
Amul
Havmor
1. 2. 3. 4. Q-20 Which is the first word that comes to your mind when you think of ice creams? _________________________________________________________________ _________________________________________________________________
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iv. Sampling Techniques I have used the non-probability sampling in my research. Further sub classifying it I can say that it is convenience-sampling technique because although the areas selected includes all major areas of Ahmedabad City, but then also it was according to my convenience.
Target Population Element The elements of research were the residents of Ahmedabad city who consumed ice creams. Extent My Research work was limited to Ahmedabad city only. Time The study was conducted for the duration of 6 weeks starting from mid-May.
Sampling Frame and Contact Method
The Sampling Frame for the research included locating the respondents in Ahmedabad city, found from the telephone directory and then contacting them personally and asking them to fill up the questionnaire prepared by us.
Sampling Size
The population of Ahmedabad is widespread in many different areas. Initially my target was to cover all the areas, but due to time constraint and unfavorable responses from certain areas, I could include only 11 areas of Ahmedabad city.
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Areas Covered (Total sample size =150 respondents) Area of Ahmedabad City Maninagar Odhav Isanpur Bapunagar Naroda Ambavadi Paldi Naranpura Vadaj Mithakali Gulbai Tekra TOTAL
No. Of Respondents 19 16 09 12 14 14 18 16 11 11 10 150
5. DATA ANALYSIS The next step is analysis of the data collected through the survey. Both statistical and inferential tools have been used for data analysis. Among the statistical tools hypothesis testing, frequency distributions etc. have been used. Among the inferential tools, I have used cross analysis and data reduction techniques to draw useful inferences from the collected data. Formulation of charts, data tables and analysis of set hypothesis gave powerful inferences from the collected data. MS WORD and MS EXCEL have been used for this purpose.
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The Question wise analysis and interpretation of the collected data is as follows: RESEARCH ANALYSIS OBJ: 1 (Q.1 TO Q.5) CUSTOMER PROFILE i.
SEX: SEX
38%
Male Female
62%
Sex Male Female TOTAL AGE: AGE >40 Age
ii.
No. 93 57 150
31-40 21-30 <20 0
50
100
No. of Consumers
Age <20 21-30 31-40 >40
No. 23 95 14 18 64
TOTAL 150 iii.
FAMILY MEMBERS 120 100 No.
80 60 40 20 0 <5
6-10
11-15
>15
Family Members
No. OF FAMILY MEMBERS: Members <5 6-10 11-15 >15 TOTAL iv.
No. 105 38 06 01 150
EDUCATION
Education Primary
Secondary
40
Graduate 4
19
87
Education Primary Secondary
No. 04 19 65
PostGraduate
Graduate 87 Post Graduate 40 TOTAL 150 v.
OCCUPATION Occupation
13%
3%
Student Service
5% 50%
Business Professional
29%
House Wife
Occupation Student Service Business Professional House Wife TOTAL
No. 74 44 08 19 05 150
OBJ: 2 (Q.6 TO Q.9) WHEN, WHERE AND FREQUENCY OF CONSUMPTION vi.
CONSUMPTION PLACE PLACE OF CONSUMPTION Go Out
Bring at Home
Both 64%
Where:
Go Out 18% Bring at Home 18%
No. 66
Both
Go Out
27 Bring Home Both 96 TOTAL 150 ** Remarks:
vii.
27
=> As seen from the chart and the data mentioned above, it can be inferred that when the respondents were asked about the place of consumption of ice cream, then the preference of only going out to consume ice cream or only bringing ice creams at home was equally probable. =>However, most of the people replied that they generally did both, i.e. they went out as well as brought ice creams at home without any notable preference.
CONSUMPTION ACCOMPANIER With Whom No. Family 86 Friends 55 Alone 09 TOTAL 150
** Remarks:
=> As seen from the data mentioned above, it can be inferred that the respondents were consuming ice creams with their families in most of the cases. Second highest preference is consumption with friends. => So, the selling of family packs and party packs should be promoted more, so that when people bring ice creams at home their preference is in favor of family packs. (All major ice cream players already provide Combo pack schemes.) => Ice Creams should be made available at places where people generally go on outings with family and friends, like restaurants, gardens (Amul ice cream), theatres etc.
viii.
FREQUENCY OF CONSUMPTION
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Frequency
CONSUMPTION FREQUENCY - w eekly 100 80 60 40 20 0 <2
2-5
>5
No. of Tim es
Frequency (Per week)
No.
<2 times 2-5 times >5 times TOTAL
89 53 08 150
** Remarks: => As seen from the data mentioned above, it can be inferred that the respondents are consuming ice creams less than 2 times per week. But this is actually affected by the seasonality factor. Most of the respondents have replied that the average consumption during the entire year is less than 2 times per week, however in summer season it increases from 2-5 times per week. => Off-season discounts should be increased or the ingredients like mint, basil etc. should be added, so that consumption during winter season does not fall considerably. ix.
TIME OF CONSUMPTION (in a day) CONSUMPTION TIME 1% 10% Morning Noon 55%
34%
Evening Night
68
When (in a day) Morning Noon Evening Night TOTAL
No. 02 15 51 82 150
** Remarks:
=> As seen from the data mentioned above, it can be inferred that the respondents are consuming ice creams generally at Night after the dinner, and secondly in the Evening. => So, the Electric sign Boards can prove to be an important advertising tool as it is more eye catching and attractive at night under the colorful light. => To increase the consumption during other time in a day like in the afternoon, ice cream availability should be increased near the shopping areas, super markets, theatres etc., so its consumption can be increased.
OBJ 3: PREFERED TYPE OF SERVING AND FLAVOR (Q.10 & Q.12) x.
TYPE OF SERVING PREFERED SERVING TYPE PREFERENCE
6%
Cone
8%
Cup
7%
45%
Candy
7%
Sundae Scoop
27%
Party Pack
Type 6 Cone Candy Cup
Rank
67 11 40
34 18 40 69
Score 1
2
3
4
5
26 38 26
14 39 26
03 16 27
03 14 17
727 471 693
Sundae 11 18 16 27 Scoop 09 23 23 17 Party pack 12 17 21 27 Note: Rank 1 is given weight 6 Rank 2 is given weight 5 Rank 3 is given weight 4 Rank 4 is given weight 3 Rank 5 is given weight 2 Rank 6 is given weight 1
42 26 36
40 43 33
425 407 427
For Example: Cone: (67*6)+(34*5)+(26*4)+(14*3)+(3*2)+(3*1) = 727 It can be seen from the score that cone is the type of serving of ice cream that is preferred by most consumers. However, cup is also having second highest preference.
**Remarks:
=> As seen from the data mentioned above, it can be inferred that the respondents are consuming ice creams generally in cone, cup and candy forms which have the respective scores in descending order. => However, these responses may be biased as the age group generally reflects the consumption pattern of younger generation. => It seems that people are not much aware of the availability of scooped ice cream and sundaes, in majority of the areas of Ahmedabad, so advertisement, schemes may prove to be useful to increase their awareness and thus their consumption. xii. PREFERENCE IN TERMS OF FLAVOR Flavour Preference
9%
Chocolate
7% 5%
Butter Scotch 45%
Kesar Pista Kaju Draksh
12%
Vanilla
22%
Seasonal
Flavor Chocolate Butterscotch
Rank 1 68 33 70
Kesar Pista Kaju Draksh Vanilla Seasonal/Fruit Flavor
**Remarks:
18 14 10 07
=> As seen from the data mentioned above, it can be inferred that the respondents prefer chocolate flavor which has been ranked 1 highest times and the second most preferred flavor is butter scotch.
OBJ:4 BUYING BEHAVIOUR (Q.11-Q.13) xi.
PREFERED PRICE TAG Price Tag (Rs.) Cup No. Cone No. Party Pack No. Family Pack No.
**Remarks:
xiii.
5-10 95 5-15 84 50-90 68 50-70 76
10-15 44 15-25 55 90-130 63 70-90 35
15-20 11 25-35 11 130-170 19 90-110 39
=> As seen from the data mentioned above, it can be inferred that the respondents generally prefer Cup of Rs. 5-10, Cone of Rs. 5-15, and Party Pack of Rs. 80-110 and Family Pack of Rs. 50-70. => The company should increase the variety in the above mentioned price range. FACTORS AFFECTING CONSUMPTION FACTORS INFLUENCING CONSUMPTION Brand
Price
Flavor
11%
Quality
8%
Availability
23%
11%
25% 22%
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Scheme
Brand Price Scheme Flavor Quality Availability
Extremely Important 5 4 106 18 50 43 38 34 102 30 117 23 49 26
3 19 31 42 12 04 35
2 03 15 16 02 02 26
Not At All Important 1 04 11 20 04 04 14
**Remarks:
=> As seen from the data mentioned above, it can be inferred that the respondents generally consider Quality, Brand and Flavor as the most important factors while consuming ice cream. The important point stems out here is the price factor is not given much importance as compared to Brand and Flavor. => However, this conclusion cannot be generalized, as the samples are taken from urban and semi urban areas. The findings might differ if rural samples are also included.
STATISTICAL TEST USING NON-PARAMETRIC HYPOTHESIS Non-Parametric tests are distribution free tests. The major advantage of using non-parametric test is that they do not require us to make the assumption that a population is distributed in a shape of a normal curve or another specific shape, moreover non-parametric test are easy to understand and do not demand any type of laborious computations like other tests. I have used sign test that is one of the type of non-parametric test. The sign test is used for paired data, where positive and negative signs are substituted for quantitative values to make the computation easier. I have used sign test in Q.13 of the questionnaire to verify whether the different factors, like brand, price etc. differ significantly in the importance received from consumers. Hypothesis:1 [ Brand and Price ] H0 : There is no significant difference between the importance given to brand and price while consuming ice creams. pH0 = 0.5 H1 : Brand is considered to be more important as compared to price while consuming ice cream. 72
No. of respondent = 150 Note: Both brand and price have been rated from 5 (extremely important) to 1 (not at all important) by the respondent. I have noted ratings of brand and price and then substituted these quantitative values by ‘+’ and ‘-‘ signs. e.g. Respondent Brand Price 1 5 3 2 4 5 3 5 5 and so on. The total of positive signs = 75 The total of negative signs = 31 The total of zero’s = 44 TOTAL = 150
Sign + 0
pH0 = 0.5 qH0 = 0.5 n = 106(Total of positive and negative signs) p-- = 75/106 = 0.7075 q-- = 31/106 = 0.2925 ε p-- = √pq/n = √0.5*0.5/106 = 0.0486 Zcal = p---pH0/ε p-= 0.7075-0.5/0.0486 = 4.2695 Let the level of significance α = 0.10
0.5
0.4 0.1
73
0
1.28
The value of Z tab = 1.28 Z cal = 4.2695 Z cal > Z tab, so reject H0 and accept H1, so brand is considered to be more important factor as compared to price while consuming ice creams by respondents. Hypothesis:2 [ Price and Flavor ] H0 : There is no significant difference between the importance given to flavor and price while consuming ice creams. pH0 = 0.5 H1 : Flavor is considered to be more important as compared to price while consuming ice cream. No. of respondent = 150 Note: Both flavor and price have been rated from 5 (extremely important) to 1 (not at all important) by the respondent. I have noted ratings of flavor and price and then substituted these quantitative values by ‘+’ and ‘-‘ signs. e.g. Respondent Flavor Price 1 5 3 2 4 5 3 5 5 and so on. The total of positive signs = 64 The total of negative signs = 20 The total of zero’s = 66 TOTAL = 150
Sign + 0
pH0 = 0.5 qH0 = 0.5 n = 84(Total of positive and negative signs) p-- = 64/84 = 0.76 q-- = 20/84 = 0.24 ε p-- = √pq/n = √0.5*0.5/84 = 0.054 74
Zcal = p---pH0/ε p-= 0.76-0.5/0.054 = 4.818
Let the level of significance α = 0.10
0.5
0.4 0.1
0
1.28
The value of Z tab = 1.28 Z cal = 4.818 Z cal > Z tab, so reject H0 and accept H1, so flavor is considered to be more important factor as compared to price while consuming ice creams by respondents. OBJ:5 IMPACT OF ADVERTISEMENT & SCHEMES ON CONSUMER (Q.14,15,16,19) xiv.
RECALL OF ADVERTISEMENT: Yes 94
No 56 Brand
xv.
Vadilal Amul Havmor Others MEDIA RECALLED
TOTAL 150 No.
25 36 19 14
Television and Newspaper are the media on which the people generally notice the advertisement of ice creams and so could recall it immediately.
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xvi.
CAUSES FOR ADVERTISEMENT REMEMBRANCE
Cause It impressed you You saw it many times It had good music xix.
No. 31 46 17 TOTAL 94
SCHEME AWARENESS As per Q.13 scheme is not given much importance by the respondents while choosing ice cream. This same conclusion is verified in this question; as most of the people are only aware of the combo pack scheme, that too only of brands like Vadilal & Havmor. The second scheme recalled is the Diwali offers of above companies. The respondents do not generally recall Amul’s schemes.
**Remarks:
=> As seen from the data mentioned above, it can be inferred that the respondents generally remember advertisement of Amul on television and of Vadilal in newspaper. So Vadilal should increase advertisement on television. => Around 33% of the people do not recall any advertisement of ice creams, so all the major ice cream players should spend more on advertisement. => Amongst the people who remember the advertisement, the main cause for remembrance is the reinforcement of ice cream advertisement especially through Hoardings, POP displays and Newspapers.
OBJ:6 BRAND PREFERENCE (Q.17,18) xvii.
TYPE OF ICE CREAM PREFERED Type Branded Unbranded TOTAL
xviii. MOST PREFERED BRANDS
76
No. 143 07 150
BRAND PREFERENCE
23% 35%
Vadilal Amul Dairy Den
15%
Havmor 27%
Brand
Rank Score 1 2 3 4 Vadilal 52 49 25 24 429 Amul 41 37 42 30 389 Dairy Den 23 30 41 56 320 Havmor 34 33 41 42 359 Note: Rank 1 is given weight 4 Rank 2 is given weight 3 Rank 3 is given weight 2 Rank 4 is given weight 1 For Example: Vadilal: (52*4)+(49*3)+(25*2)+(24*1) = 429 It can be seen from the score that Vadilal is the brand of ice cream that is preferred by most consumers. However, Amul is also having second highest preference.
**Remarks:
=> Ahmedabad people generally consume branded ice cream as compared to locally manufactured unbranded ice creams. However, these responses might be different if the rural and semi urban respondents are included. => As seen from the data mentioned above, it can be inferred that in the oligopolistic market of ice creams, Vadilal is the market leader and Amul is the challenger. => Havmor’s market share is significant in Ahmedabad and Gujarat and it is generally preferred brand of youngsters. But, its reach is limited to Gujarat only. => All varieties of Dairy Den are perceived to be costlier except Yums so its penetration is low.
OBJ: 7 ICECREAM AND CONSUMER IMAGERY (Q.20) xix.
MOST RECALLED WORD RELATED TO ICE CREAM
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Word Yummy Creamy Desert Delicious Vadilal Chocolate Cool Others
**Remarks:
Frequency 14 30 18 08 23 17
=> When the respondents were asked to recall the word that immediately struck their minds when they thought of ice creams, the people generally called it ‘Delicious’, so it can be inferred that people consumes ice cream because of its taste. => Ice cream is also considered as a cooling agent and so the people remember the word cool, even in the hot climate of Ahmedabad city. => Some of the people also considered ice creams synonymous to Vadilal brand. The king cone and vanilla flavor of Vadilal are the words recalled immediately by the people. It shows that Vadilal has been successful in occupying consumers’ imagery.
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POST RESEARCH FINDINGS POST RESEARCH SWOT ANALYSIS: VADILAL ICE CREAM INDUSTRY STRENGTH WEAKNESS There is large number of Vadilal is not aggressive in flavors (70) giving customer promotion and advertising. a range of choice. Lack of innovation and It has the maximum range of initiatives to introduce new ice cream products in India. concepts in the area. (over 200 SKUs). Lack of interaction with the One of the oldest retail dealers and handling manufacturers of ice cream of their problems. and hence have a well Lack of innovation in established brand name. recently launched flavors Well-established cold chain against Amul and Havmor. network of 12 G&F agents, Schemes and offers are not 250 distributors and 16000 advertised / promoted retail dealers. effectively to end users at Market leader in Gujarat. large. Gaining market in Rajasthan, UP etc. Quality is given utmost importance as depicted in their philosophy ‘To provide quality products and services at an affordable 79
price.’
OPPORTUNITY THREAT With its loyal dealer network it Other companies are taking can forgo into new markets advantage of its slowness in promotion in a misleading the With the entry of foreign customers and dealers. players in the market it can go into collaboration with them, Lack of niche. With the as they will be willing to be increasing competition it associated with an established would be very difficult to brand name. survive without a niche market. Because of its emphasis on quality it is held high in the Havmor and Amul with minds of customers. Thus it competitive flavors and prices can increase the market share. becoming major threat for the company. A favorite with the customers’ because of its large variety of Consumers are unaware of flavors and SKUs. half of the schemes and as a result, schemes are not able to Because of its leadership in achieve the targets. novelties and impulse items it is the hot favorite with young generations. By introducing some trendy products and attractive packaging can increase its hold substantially. The major findings obtained from this research work are as follows:
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1. People generally consume ice cream both by going out and bring ice creams at home without any special preference. 2. Respondents consume ice creams generally at night after dinner or in the evening. 3. The frequency of consumption is less than 2 times per week (Avg. during the year), however this increases to 2-5 times depending on seasons. 4. Cones, cups and candy are the most preferred type of ice cream serving, especially among young people. 5. The flavors that are liked by majority of consumers are chocolate and then butterscotch. 6. Brand is given much importance and majority of consumers consume branded ice cream and when compared to price brand is given more ratings. 7. Flavor is regarded as a very important factor by respondents and they are not ready to compromise on their favorite flavors, even if they have to pay high price for it. 8. As far as the recall of advertisement of ice cream is concerned, people recall the advertisement of Amul on television and Vadilal in newspaper and Hoardings. Some of the people do not recall any ice cream advertisement. 9. Vadilal is the most preferred ice cream brand by the people followed by Amul. 10.Consumers’ imagery is occupied by the words like delicious, yummy, cool and Vadilal when they think of ice cream. Results of Cross Analysis: I have tried to correlate pair of question from the questionnaire to establish association between them and to infer important facts from that. 1. Cross Analysis between Gender and preference of Flavor The total no. of females = 57 / 150 Out of 57 female respondents, 38 female respondents (66%) gave rank 1 to chocolate flavor when they were asked to rank different ice cream flavors and 32 out of 93 male respondents (34%) preferred butterscotch flavor and 24 males (26%) prefer chocolate flavor.
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2. Cross Analysis between Age and type of Serving
The age group of less than 20 years and 21-30 years generally prefers cone and candy types of ice cream serving, while people between age group of 31-40 prefers cups and family – party packs. 3. Cross Analysis between Age and preference of Flavor
The people of age group less than 20 prefers chocolate flavor and that of 21-30 also prefers it. Age group 31-40 likes flavors like butter scotch, kaju draksh and chocolate. General Suggestions after the research work: 1. The selling of family packs and party packs should be promoted more, so that when people bring ice creams at home their preference is in favor of family packs. (All major ice cream players already provide Combo pack schemes.) Ice Creams should be made available at places where people generally go on outings with family and friends, like restaurants, gardens (Amul ice cream), theatres etc 2. Off-season discounts should be increased or the ingredients like mint, basil etc. should be added, so that consumption during winter season does not fall considerably. 3. The Electric sign Boards can prove to be an important advertising tool as it is more eye catching and attractive at night under the colorful light. To increase the consumption during other time in a day like in the afternoon, ice cream availability should be increased near the shopping areas, super markets, theatres etc., so its consumption can be increased. 4. It seems that people are not much aware of the availability of scooped ice cream and sundaes, in majority of the areas of Ahmedabad, so advertisement, schemes may prove to be useful to increase their awareness and thus their consumption.
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BIBLIOGRAPHY Books: 1. Business Research Methods By Donald R. Copper & Pamela S. Schindler Tata McGraw-Hill Publishing Company Ltd. New Delhi, 2002 Edition 2. Marketing Research By Naresh K. Malhotra Pearson Education, Inc. New Delhi, 2004 Edition 3. HandBook For Writers & Editors By S. Srinivas Rao Ahmedabad Management Association Ahmedabad, 2002 Edition
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Websites: www.vadilalgroup.com www.indiainfoline.com www.google.com www.amul.com
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