marketing strategy of AMUL

A

PROJECT REPORT

ON

MARKETING STRATEGY OF AMUL

( MMM-A + PGDM )

SUBMITTED BY:

SIDDARTH RAVINRAN

JAYDEV KUMAR

NIRAJ KUMAR PANDAY

DHARMENDRA PRASAD

SANDEEP KUMAR

RAKESH KUMAR

SINHGAD INSTITUTE OF BUSINESS ADMINISTRATION AND RESEARCH

2010-2012

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ACNOWLEDGEMENT

We extend my sincere thanks to Mr. Swapnil Patil for providing us the opportunity to

work on this project.

We express our deep sense of indebtness to him because he has been the moving force

behind the successful accomplishment of the project we thank him for taking time out of

his busy schedule and guiding me in the project.

We would also like to thank our project guide Swapnil Patil and faculty members for their

valuable guidance and encouragement at all the stages of the project.

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PREFACE

The success of any business entity solely depends on how effectively does it utilizes its optimum

resources and how soon does it make arrangements for the removal of the customer’s grievances.

Moreover, the company should always be ready to make necessary changes according to the

requirement in order to attract more customers so as to maintain a substantial growth in the

market. The topic given to me was:

“MARKETING STRATEGIES AMUL”

We have tried to put our best efforts to complete this task on the basis of skill that we have

achieved during our studies in the institute. We have tried to put my maximum effort to get the

accurate statistical data. If there is any error or any mistake in collecting the data, please ignore

it.

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INDEX

Objectives of the project

Introduction of the Topic

Company profile of Amul

Amul and co-operation

GCMMF

PEST Analysis amul

4P’s of markering

Comparison between chocolate companies

Conclusion

Bibliography

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OBJECTIVES OF THE PROJECT

The main objective of the study on this project is to demonstrate the marketing strategies of

Amul India Ltd. And to arrive at my findings, I have done PEST analyses.

And also 4 P’s of Marketing:-

• Product

• Price

• Physical Distribution

• Promotion

INTRODUCTION TO THE TOPIC

5

.

The topic “To study about Strategy and Market Share of Amul chocolates“ highlights on the

market share of Amul Chocolates Pune city in comparison to existing player in the Milk

chocolate Market.

The market share can be found with the help of retailers. As the competitors are concerned there

are only two of them i.e. Cadbury and Nestle

The study is also concerned to find out the various reasons due to which the retailers do not

prefer to sell Amul Chocolates. Moreover the study also helps in knowing the best medium for

creating the awareness about the Amul Chocolates.

To know the Market share and problems faced by retailers is very important for every

organization for their promotion, expansion and development.

COMPANY PROFILE

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1. Formed in 1946, Amul has initiated the Dairy Cooperative movement in India and formed an

Apex Cooperative Organization, Gujarat Co-operative Milk Marketing Federation Ltd.

(GCMMF), jointly owned by some 2.1 million milk producers in Gujarat, India. Its products,

including milk powders, liquid milk, butter, ghee, cheese, chocolate, ice cream and pizza

are widely used throughout India and abroad and have made Amul the largest food brand in

India today with an annual turnover of some Rs.29 Billion ($US 616 million) per annum.

2. The primary goal of Dr. V. Kurien, Chairman, GCMMF, has been to build a strong Indian

society economically through an innovative cooperative network, to provide quality service and

products to end- consumers and good returns to the farmer members. Dr. Kurien states, “We

have traversed a path that few have dared to. We are continuing on a path that still fewer have

the courage to follow. We must pursue a path that even fewer can dream to pursue. Yet, we

must. We hold on trust the aims and aspirations o millions of our countrymen”.

3. Information Technology has played a significant role in developing the Amul brand. The

logistics behind co-ordinating the collection of some 6 million litres of milk per day from

10,755 separate Village Cooperative Societies throughout Gujarat and then storing, processing

and producing milk products at the respective 12 District Dairy Unions, are awesome. The

installation of 3000 Automatic Milk Collection System Units (AMCUS) at Village Societies to

capture member information, milk fat content, volume collected and amount payable to each

member has proved invaluable in ensuring fairness and transparency throughout the whole

Amul organization.

4. In 1996 Amul was one of the first major organizations in India to have a website and this has

been used both to develop an intranet of Amul distributors as well as a cyber-store for

consumers, one of the first examples of e-commerce activity in India.

AMUL AND CO-OPERATION

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The CEO, Mr. B M Vyas, said that. “Amul is not a food company; it is an IT company in the

food business”. In saying this he was recognizing that the most efficient way of building links

between milk producers and consumers so as to provide the best returns for the both is through

IT innovation.

Thus is why Amul has embraced the ideas behind coop with such enthusiasm. Not only will the

TLD enable consumers in India to recognize an established brand they can trust online, it will

enable Amul to begin trading competitively throughout the world, reaching markets, which have

hitherto been inaccessible.

The CIO, Mr. Subbarao Hegde said, “Information Technology is the most effective tool we have

in communicating with our members and the millions of consumers who purchase Amul

products throughout India every day. Coop not only reflects the cooperative values which shape

our own organization democratically dynamic, it will also give us a vital business advantage as

we seek to develop the Amul brand throughout the world.”

AMUL means “priceless” in Sanskrit. The brand name “Amul,” from the Sanskrit “Amoolya,”

was suggested by a quality control expert in Anand. Variants, all meaning “priceless,” are found

in several Indian languages. Amul products have been in use in millions of home since 1946.

Amul Butter, Amul Milk Powder, Amul Ghee, Amulspray, Amul Cheese, Amul Chocolates,

Amul Shrikhand, Amul Ice cream, Nutramaul, Amul Milk and Amulya have made Amul a

leading food brand in India. (Turnover: Rs. 29 billion in 2004). Today Amul is a symbol of many

things. Of high-quality products sold at reasonable prices.

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GUJARAT CO-OPERATIVE MILK MARKETING FEDERATION

(GCMMF)

An Overview: -

Gujarat Cooperative Milk Marketing Federation (GCMMF) is India’s largest food

products marketing organization. It is state level apex body of milk cooperative in Gujarat which

aims to provide remunerative returns to the farmers and also serve the interest of consumers by

providing quality products which are good value for money.

Members: 12 district cooperative milk producers UnionNo. of Producers Members 2.36 millionNo. of Village Societies 11,333Total Milk handling capacity 6.9 million liters per dayMilk collection (Total –2002-03) 1.86 billion liters Milk collection (Daily Average (2003-04) 4.97 million litersMilk Drying Capacity 511 metric Tons per dayCattle feed manufacturing 2340 Mats per dayCapacity:

Sales TurnoverRs(million) US $ (in millions)

1994-95 11140 3551995-96 13790 4001996-97 15540 4501997-98 18840 4551998-99 22192 4931999-00 22185 4932000-01 22588 5002001-02 23365 5002002-03 27457 5752003-04 28941 6162005-06 37736 8502006-07 42778 10502007-08 52448 13252008-09 67113 1504

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PEST ANALYSIS OF AMUL

P-) Since the budget range is decontrolled, no political effects are envisaged.

E-1) Increasing per capita income resulting in higher disposable income

2) Growing middle class/urban population – increase in demand.

3) Low cost of production – better penetration.

S-1) Per capita consumption expected to increase – fashion.

2) Increasing gifts culture – increase in demand.

3) Lower cholesterol than “Mithais” (sweet meat) – substitute demand

T-) Will have to reinforce technology to international levels once India is a “free” economy

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4 P’S OF MARKETING

PRODUCT:-

Satisfaction suffices. But delight dazzles the average company will compete for customer by

conforming to her expectation consistently. But the winner will surpass them by constantly

exceeding her expectation, delivering to her door step additional benefits which she would never

have imagined possible. Cadbury’s offer such product. The wide variety products offered by the

company include:

List of Products Marketed: -

Breadspreads: Amul Butter Amul Lite Low Fat Breadspread Amul Cooking Butter

Cheese Range: Amul Pasteurized Processed Cheddar Cheese Amul Processed Cheese Spread Amul Pizza (Mozarella) Cheese Amul Shredded Pizza Cheese Amul Emmental Cheese Amul Gouda Cheese Amul Malai Paneer (cottage cheese) Frozen and Tinned Utterly Delicious Pizza

Mithaee Range (Ethnic Sweets): Amul Shrikhand (Mango, Saffron, Almond Pistachio, Cardamom) Amul Amrakhand Amul Mithaee Gulabjamuns Amul Mithae Gulabjamun Mix Amul Mithaee Kulfi Mix

UHT Milk Range: Amul Taaza 3% fat Milk Amul Gold 4.5% fat Milk Amul Slim-n-Trim 0% fat Milk

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Amul Chocolate Milk Amul Fresh Cream Amul Snowcap Softy Mix Amul Taaza Double Toned Milk

Pure Ghee: Amul Pure Ghee Sagar Pure Ghee Amul Cow Ghee

Infant Milk Range: Amul Infant Milk Formula 1 (0-6 months) Amul Infant Milk Formula 2 (6 months) Amulspray Infant Milk Food

Milk Powders: Amul Full Cream Milk Powder Amulya Dairy Whitener Sagar Skimmed Milk Powder Sagar Tea and Coffee Whitener

Sweetened Condensed Milk: Amul Mithaimate Sweetened Condensed Milk

Fresh Milk: Amul Taaza Toned Milk 3% fat Amul Gold Full Cream Milk 6% fat Amul Shakti Standardised Milk 3% fat Amul Smart Double Toned Milk 1.5% fat

Curd Products: Amul Masti Dahi (fresh curd) Amul Butter Milk ,Amul Lassee

Amul Icecreams: Royal Treat Range (Rajbhog, Cappuccino, Chocohips, Butterscotch, Tutti Frutti) Nut-o-Mania Range (Kaju Drakshi, Kesar Pista, Roasted Almond, Kerar Carival,

Badshahi Badam Kulfi, Shista Pista Kulfi) Utsav Range (Anjir, Roasted Almond) Simply Delicious Range ( Vanilla, Strawberry, Pineapple, Rose, Chocolate) Nature’s Treat (Alphanso Mango, Fresh Litchi, Anjir, Fresh Strawberry, Black

Currant) Sundae Range (Mango, Black Currant, Chocolate, Strawberry) Millennium Icecream (Cheese with Almonds, Dates with Honey) Milk Bars (Chocobar, Mango Dolly, Raspberry Dolly,Shahi Badam Kulfi, Shahi

Pista Kulfi, Mawa Malai Kulfi, Green Pista Kulfi)

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Cool Candies (Orange, Mango) Cassatta Tricone (Butterscotch, Chocolate) Megabite Almond Cone Frostik – 3 layer chocolate Bar Fundoo Range – exclusively for kids SlimScoop Fat Free Frozen Dessert (Vanilla, Banana, Mango, Pineapple) Health: Isabcool

Chocolate & Confectionery: Amul Milk Chocolate Amul Almondbar Amul Fundoo Amul Chocozoo Amul Bindaaz Amul Fruit & Nut Chocolate

Brown Beverage: Nutramul Malted Milk Food

Milk Drink: Amul Shakti Flavoured Milk

Ready to Serve Soups: Masti Hot & Sour Soup

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PRICING:-

Second P of marketing is not another name for blindly lowering prices and relying on this

strategy alone to increase sales dramatically. The strategy used by Cadbury’s is for matching the

value that customer pays to buy the product with the expectation they have about what the

production is worth to them.

AMUL has launched various products which cater to all customer segments. So every

customer segment has different price expectation from the product. Therefore

maximizing the returns involves identifying right price level for each segment, and then

progressively moving through them.

In milk chocolate Amul has the following brands:

All the chocolates are made up of:

Milk Fat - (2%)

Sugar - (55%)

Cocoa Solids - (7.5%)

Solid Milk - (20%)

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Name of chocolate Weight Price

(Rs.)

Amul Milk Chocolate 35g 10

Amul Fundoo 30g 10

Amul Fundoo 15g 5

Amul Fruit Nut 35g 15

Amul Bindaaz 30g 10

Amul Almondbar 35g 10

Amul Chocozoo 500g(Tub) 138

Physical Distribution – “Place”

In a product and price parity situation, the brand that sells more is the one that reaches the

highest number of customers. India – 1 billion people, 155 million household has over 4 million

retail outlets in 5351 urban markets and 552725 villages, spread cross 3.28 million sq.

Promotion

If an advertisement is to communicate effectively, the receiver must at least half want it to, and

be prepared too take step toward the sender. Effective advertising is rarely hectoring or loudly

explicit…. It often both attracts and generates arm feelings. More often than not, a successful

campaign has a stronger element of the unexpected a quality that good advertising shares with

much worthwhile literature.

To penetrate into the inner recesses of her memory, communication must first ensure exposure,

grab her attention evoke her comprehension, grab her acceptance and then extract retention

competing with thousands of other units of communication trying to do the same.

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COMPARISION BETWEEN CHOCOLATE COMPANIES

1) Name of Chocolate Companies and their penetration in market-

The table below deals in finding the numbers of retailers that sells different company chocolates

and their penetration in markets.

Table 1.1

Chocolate companies and their penetration

Name of company No of shops

Amul 20

Cadbury 149

Nestly 148

Other 18

Graph 1.1

Chocolate companies and their penetration

Amul Cadbury Nestle Others0

20

40

60

80

100

120

140

160

20

149 148

18

The graph 1.1 shows the number of retailers selling different company chocolates. There are only 20 retailers i.e. 13.33% who deal in Amul chocolates. The percentage is very less compared to Cadbury and Nestle.

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2) Market share

The table below deals in finding the Market Share of Amul Chocolates and other companies chocolate.

Table 2.1 Market Share

Graph 2.1

Market Share

1%

65%1%

34%

Amul

Cadbury

Others

Nestle

The graph 2.1 shows the market share of different company chocolates in terms of rupees. From the graph we can say that the market share of Amul chocolates is only 1%, which is very less, compared to other companies. Cadbury has the maximum share of 64.5%.

3) a) Brands of Amul chocolates sold on Amul chocolate Outlet.

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Name of company

Total Sale

(Per month)

Market share (%)

Amul Rs. 3130 00.84%

Cadbury Rs. 239750 64.5%

Nestle Rs. 125940 33.9%

Others Rs. 2500 00.67%

Total Rs. 371320 100%

The table below helps in finding the different brands of Amul Chocolates that is available on Amul Chocolate Outlet. A shop that sells even one Amul Chocolate is an Amul Chocolate Outlet

Table 3.1

Brand of Amul Chocolates & their selling percentage

Brand of Amul Chocolates & their selling percentage

A B C D E F G H0

2

4

6

8

10

12

14

16

8

4

11

4

16

6

0 0

Graph-3.1

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Name of chocolate No. Of Amul chocolate Outlet

A Amul Milk chocolate 8

B Amul Fundoo 4

C Amul Fruit n Nut 11

D Amul Bindaaz 4

E Amul Almondbar 16

F Amul Chocozoo 6

G Amul Rejoice 0

H All Chocolates 0

The Graph 3.1 above shows that Amul Almond Bar is sold at most of the Amul Chocolate outlet followed by Amul fruit n Nut & Amul Milk Chocolate. There is not a single outlet that sells Rejoice.

3) b) Ordering Pattern

The table below deals in finding the ordering pattern for Amul Chocolates.

Table 3.2

Ordering Pattern

Graph 3.2

Ordering Pattern

Daily Weekly Monthly0

5

10

15

20

25

0 0

20

The graph 3.2 shows the ordering pattern followed by Amul Chocolate outlets. It is seen that almost all of them order once in a month since their demand is very less.

4) Financial Support for promotion.

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Option No. of Retailers

Daily 0

Weekly 0

Monthly 20

The table below deals in knowing whether the company provides any financial support for promotion to Amul chocolate outlets.

Table 4.1 Financial Support For Promotion

Graph 4.1

Financial Support for Promotion

Yes No0

5

10

15

20

0

20

The graph 4.1 shows the financial support for promotion. From the graph we can say that

according to the retailers the company does not provide any financial support for promotion.

20

Option No. of Retailers

Yes 0

No 20

5) Reasons for not selling Amul Chocolates .

The table below deals in finding the reasons for retailers due to which they do not sell Amul Chocolates.

Table 5.1

Reasons For Not Selling Of Amul Chocolates

Graph 5.1

Reasons For Not Selling Amul Chocolates

A B C D E F0

20

40

60

80

100

120 108

73

98

45

2115

The graph 5.1 shows the various reasons due to which the retailers do not sell Amul

chocolates. From the graph we can say that Distribution & Service problems and Low

Margin are the major reasons followed by Low demand and Replacement problem because

of which the retailers do not want to sell Amul chocolates.

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Reasons No. of Retailers

A Distribution & Service problem 108

B Low demand 73

C Low Margin 98

D Replacement Problem 45

E No Refrigerator 21

F Not Interested 15

6) Reasons for Preference in selling other company chocolates .

The table below deals with finding the reasons due to which the retailers prefer to sell other company chocolates and not Amul chocolates.

Table 6.1

Reasons For Selling Other Company Chocolate

Reasons No. of Retailers

A Good Distribution and Service 97

B More Demand 105

C Higher Margin 73

D Better Replacement 23

E More Benefit 30

Graph 6.1

Reasons For Selling Other Company Chocolate

A B C D E0

20

40

60

80

100

120 97105

73

23 30

The graph 6.1 shows the reasons for which the retailers prefer to sell other company

chocolates. The major reasons are the More demand of other company chocolates, Good

service as well as Higher Margin.

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7) The most attractive scheme.

The table below deals with finding the most attractive scheme according to the retailers.

Table 7.1 The most Attractive Scheme

Graph 7.1

The Most Attractive Scheme

Incentive Scheme

Free Pack on Large Purchase

Increase Profit Margin

Lucky Draw0

20

40

60

80

100

34 40

79

25

The graph 7.1 shows show the Different Schemes for attracting the retailers for selling

Amul Chocolates. Mostly the retailers are attracted towards increased Profit Margin

followed by Free Pack on large purchase.

23

Different Schemes No. of Retailers

Incentive Scheme 34

Free Pack on Large Purchase 40

Increase Profit Margin 79

Lucky Draw 25

8) Mediums for Creating Awareness .

The table below deals in finding the most appropriate medium for creating awareness.

Table 8.1

Effective Medium

Graph 8.1

The Effective Medium

More TV / News paper Adver-

tisement

Banners Gift/Coupons0

20406080

100120140160 150

6248

The graph 8.1 shows the different effective mediums for creating awareness about the Amul

chocolates. According to all of the retailers, the most effective medium is TV and

Newspaper advertisement.

24

Option No. Of Shops

More TV / News paper Advertisement

150

Banners 62

Gift/Coupons 48

CONCLUSION

As we know that Amul is very big organization and market leader in dairy products. It has

maximum market share in Milk, Butter and Cheese, which are its main/core products. As we know

Amul is a co-operative organization but chocolate industry is a profitable industry we can’t ignore

it. With the help of research, company can find out its week points in chocolate product and can

increase its market share through rectify mistakes. People have believed in Amul’s product and

they will accept its chocolates also if effective actions were taken. The survey resulted into

following conclusions :

Amul must come up with new promotional activities such that people become aware

about Amul Chocolates like Chocozoo, Bindaaz, and Fundoo.

Quality is the dominating aspect which influences consumer to purchase Amul product,

but prompt availability of other chocolate brands and aggressive promotional activities by

others influences the consumer towards them and also leads to increase sales.

In comparison to Amul Chocolate, the other players such as Cadbury, Nestle, are provide

a better availability and give competition to the hilt.

People are mostlysatisfied with the overall quality of Amul Chocolate, but for the

existence in the local market Amul must use aggressive selling techniques.

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BIBLIOGRAPHY

1. www.amul.com 3. www.google.com 4. www.marketresearch.com 5. www.dairy.com 6. Research Methodology. (Harper W.Boyd, C. R. Kothari

[email protected]

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