PROJECT REPORT On “A STUDY OF SALES PROMOTION STRATEGIES OF PARLE PVT. LTD.” Submitted to M D University Rohtak in the partial fulfillment of the requirement for the award of degree of Master of Business Administration 2010-11 Submitted by: Vijay Kumar MBA 2.4(G) ROLL NO.
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PROJECT REPORT
On
“A STUDY OF SALES PROMOTION STRATEGIES OF PARLE PVT. LTD.”
Submitted to M D University Rohtak in the partial fulfillment of the requirement for the award of degree of
Master of Business Administration
2010-11
Submitted by:
Vijay Kumar
MBA 2.4(G)
ROLL NO.
INSTITUTE OF MANAGEMENT STUDIES AND RESEARCH M D University,ROHTAK
Table Contents:-
History of Biscuit Industries
Introduction to Biscuits Industries
Different Brands of Parle
Export Import Policy of Parle Industries
Research Methodology
Introduction to topic
Introduction to Quality Circle
Conclusion of Survey
Questionnaire
Bibliography
Acknowledgement
Behind every success there are thousands. I wish to pay my gratitude to each one of them. At the outset, I wish to express my gratitude towards my lovable faculty & thankful to all whom contributed the completion of this report. I am grateful to Dr. Daleep Singh, Professor IMSAR whose continuous encouragement & willing cooperation provided me a great help in the preparation of this project.
Last but not least I thank all of those who are responsible for the success of this report.
(VIJAY KUMAR)
PREFACE
With the globalization & liberalization, business management has becomes so
difficult and environment so complex that nothing less than “The Best “can survive in
this business world. So the business manager must not only be acquainted with the
latest management tools and techniques, but he should also know how to implement
them.
“Theory without practice is sterile; practice without theory is blind”. So no,
doubt, class room is important but
at the same time, project is also an integral part of a future manager’s curriculum. It
gives him a chance to apply the concepts in real life situations.
All M.B.A students are required to undergo project report in fourth semester. I have
done my project under Dr. Dilip Singh The project given to me that is “A Study of
Sales Promotion Strategies of Parle Pvt. Ltd.”. On the Basis of the survey
conducted, I have concluded the findings.
Introduction
A long time ago, when the British ruled India, a small factory was set up in the
suburbs of of Mumbai city, to manufacture sweets and toffees. The year was 1929 and
the market was dominated by famous international brands thatwere imported freely.
Despite the odds and unequal competition, this company called Parle Products,
survived and succeeded, by adhering to high quality and improvising from time to
time.
A decade later, in 1939, Parle Products began manufacturing biscuits, in addition to
sweets and toffees. Having already established a reputation for quality, the Parle
brand name grew in strength with this diversification. Parle Glucose and Parle
Monaco were the first brands of biscuits to be introduced, which later went on to
become leading name for great taste and quality.
Biscuit
A biscuit is a small baked bread. The exact meaning varies markedly in different
parts of the world, sometimes leading to confusion. The origin of the word "biscuit" is
from Latin via Middle French and means "twice cooked". Some of the original
biscuits were British naval hard tack. That was passed down to American culture, and
hard tack (biscuits) was made through the 19th century.
British digestive biscuits
A biscuit is a hard baked product like a small flat cake which in North America may
be called a "cookie" or "cracker". The term biscuit also applies to sandwich type
biscuits, where a layer of 'cream' or icing is sandwiched between two biscuits. It
should be noted, however, that it has become increasingly more common within the
UK for "cookie" to be used to differentiate between the softer, more chewy "cookie"
and the harder, more brittle "biscuit."[citation needed] In this respect the British usage of the
word biscuit was defined in the defense of a tax judgement found in favor of
McVitie's and their product Jaffa Cakes which the Inland Revenue claimed was a
biscuit and was therefore liable to value added tax. The successful defense rested on
the fact that 'biscuits go soft when stale, whereas cakes go hard when stale.'
In Britain, the digestive biscuit has a strong cultural identity as the traditional
accompaniment to a cup of tea, and is regularly eaten as such. Many tea drinkers
“dunk” their biscuit into their tea, allowing it to absorb liquid and soften slightly
before consumption.
Although there are many regional varieties, both sweet and savory, "biscuit" is
generally used to describe the sweet version. Sweet biscuits are commonly eaten as a
snack and may contain chocolate, fruit, jam, nuts or even be used to sandwich other
fillings. Savory biscuits, more often called crackers or crispbreads, are plainer and
The primary reason for communication and implementation of the sales promotion is
to identify some specific marketing need that then can be met with the corporate
products and the proper promotional activity.
Sales promotion then falls into two different categories that are “aimed to lure the
customers to increase volume of purchases” (Mundy, 150):
1. Trial promotion -----This type of promotion is aimed at motivating customers
to use our corporate products or services for the first time.
2. Loyalty ----- This type of promotion is aimed at increasing the chances of a
given customer using the product more than once.
Sales Promotion usually is timed by the companies and the sales promotion results
are viewed over a much shorter period of time than the corporate advertising. I should
note that sales promotion changes and contributions indeed can be identified much
easily as compared to traditional advertising and quantified with figures and data
(Magee, 210).
Speaking about contrast, I have to note that promotion is designed to make a special
call for action, while the brand awareness does not provide any specific push or call
for action. Therefore, if the company’s brand awareness is the management’s
objective rather than a trial, then it appears that one should use advertising for that
particular purpose, simply because promotion is not aimed to increase brand
awareness but rather the increased purchased volume.
In order to increase the brand awareness one is able to use things like direct mail, PR,
or various sponsorship campaigns. One should not forget that it is advertising, not
promotion, that “builds awareness and imagery of the company’s products and
services, let alone the needed brand values” (Neslin, 44).
Nevertheless, sales promotion appears to provide more results as compared to
advertising to smaller businesses just because promotional activity can be much better
targeted than advertising.
Sales promotion is created to target all or some of the following
groups:
Target Market of the product/service.
Part of Target Market.
Different stakeholders of the organization who might also be the target market for our
goods/services (Benun, 130).
Sales promotion process involves and elaborate plan to assure that the money spent on
promotion are worth the effort and the subsequent results.
The sender is the company that decides to create a sales promotion message. The
receiver is the target market or any other audience to which the sales promotion
message is directed.
The whole sales promotion process involves the following steps:
Encoding ----- The promotional message is put and delivered to the target
audience in the form of symbols. These symbols usually are time bound and show
some benefit to the target market (Neslin, 46).
Decoding ----- The promotional message in the encoded form is received by
the potential customer and is interpreted according to their frames of reference. One
should understand that the same “sales promotion message might be interpreted
differently by different people” (Hopkins, 186).
Response ------After the message is decoded the customer/potential
customer forms his/her opinion on the given matter. Response is usually represented
by the desire to buy/not to buy a given product/service.
Feedback ------After the sales promotion has been initiated the company
then collects feedback in the form of increased/decreased sales, customer calls,
online orders etc.
In order for the sales promotion campaign to become successful, the company/sender
needs to understand the following (Schultz, 90):
a.What audience is likely to buy our products.
b.What responses need to be achieved.
c.How the target group will decode our message.
d.What media should one use to properly deliver sales promotion
message.
Brand loyalty , on the other hand is the customer’s conscious or
unconscious decision as expressed through his/her behavior to purchase the given
brand.
One should not forget that brand loyalty can take several forms from the least to the
greatest:
1. Brand awareness ---This is when the customer is aware of the product or
company.
2. Brand recognition ---This is when the customer can easily identify the
product or brand.
3. Brand preference --- This is when the customer chooses this company’s
product over the competing products in most cases (Magee, 214).
4. Brand insistence --- This is when the customer refuses to use any other product
than the product of a certain brand.
One should remember that brand loyalty occurs because the consumer views the given
product as the one that possesses the needed features, image, let alone the proper
quality or price. Brand loyalty might be compared to habits that customers have
because of the level of safety and familiarity.
As for the sales promotion I would like to note that it is conducted to increase the
volume of purchases. Thus, as one can understand, the customers with brand
insistence are not likely to switch to our product despite the sales promotion. The
other groups with lower levels of brand loyalty might indeed give it a try and use our
product. Yet as we understand in order to develop the brand loyalty, the product
besides possessing the needed qualities and price should be viewed as a habit. The
products with inferior quality after the sales promotion will be immediately refused by
the market, because in my opinion nothing can kill a bad brand faster than sales
promotion and advertising. Yet, assuming that the product possesses outstanding
qualities and price, one should still conduct sales promotions to a degree so that the
potential customers accumulate enough of our products to develop a habit of buying
and using them (Mundy, 157).
Brand equity is an intangible corporate asset that depends on existing associations
made by the consumer. Brand equity can be viewed from three perspectives:
1. Financial ---- Brand equity in this sense can be measured by determining the
price premium over similar generic product. Thus is consumers will to pay $100 or
$500 more for a branded TV or fridge it reflects their attitude towards that brand.
One should still be aware of the sales promotion costs when estimating the financial
brand equity (Shimp, 71).
2. Brand extensions ---- Any successful brand can be used to create similar or
related products. Brand extensions therefore, allow the company to reduce the
advertising expense of the subsequent branded products. Appropriate brand
extensions oftentimes allow the company to benefit the core brand despite the
difficulty to quantify the brand extensions compared to financial measures of brand
equity of the company.
3. Consumer-based ----Consumers improve or develop brand loyalty as the
brand becomes stronger and more popular. That can also mean that in the early
stages of building a strong brand, trial samples of sales promotion indeed can be of
greater benefit than the traditional advertising.
COMPARE:
Sales promotion can be compared to the brand loyalty and brand equity in a manner
that it connects the customers with the company by prompting them for some action.
As noted earlier, the customers develop brand loyalty over a period of repetitive
buying, thus one can make a reasonable speculation that sales promotion has a direct
influence on sales loyalty.
As for the impact of sales promotion on Brand equity the relationship appears to be
less direct. There can be a reserve relationship observed in the consumer-based brand
equity perspective, i.e. as sales promotion increases the customer brand loyalty, it at
the same time improves the consumer-based perspective of the brand equity. Sales
promotion by creating Brand equity, thus creates some added value for a given
product.
CONTRAST:
Sales promotion differs from brand loyalty and brand equity in its entirety. Sales
promotion is the process that aims to boost the company’s sales, while brand loyalty
is the mental state of individual buyers that presents some products are more
preferable than others. Brand equity on the other hand is some asset that adds value to
the product thus making it more desirable to customers for that intangible value alone
rather than for some discounts/coupons/sales that sales promotion uses.
CRITIQUE:
Sales promotion does have impact on the brand loyalty and brand equity, yet it is not
the only thing that impacts brand loyalty and brand equity. If the product is of no
good quality-sales promotion will be useless. If the competitors present better
products, support services for that product etc., sales promotion will once again lead
to little result. If products are generic, sales promotion is not likely to make much
impact on brand loyalty and brand equity (if you sell eggs or aspirin, regardless of
your promotion efforts, people will understand that there exist numerous substitutes
and thus won’t develop loyalty for some particular brand of eggs).
In conclusion, I would like to note that sales promotion is the element of the
promotional mix that is aimed at increasing the volume of products sold via a trial or
brand loyalty. The brand loyalty reflects the customer desire to buy the product or
service of a given brand and depending on the level of brand loyalty that desire can be
different. Sales promotion sends mixed signals with respect to building brand loyalty
simply because it is hard to understand the amount of time or products needed to
develop a buying habit that reflects brand loyalty. At the same time, sales promotion
might be effective in building brand equity, or the existing value and association made
by the consumer.
OTHERS STEPS BY MANUFACTURER FOR PROMOTING SALES
Dealers can be helps in different ways:-
1. Communication Market New:-
Often this service is reciprocal the manufacturer may acquaint his dealer with
the fact relating to his production and prices while the dealer may familiarize
him in return with the information bearing on charges in the consumer’s
demand, their like and dislike complaints and criticism, substitutes etc.
2. Inviting to sales conference and convention :
The gestures of regard and respect pave the way for better relation and co-
operation.
3. Offering reasonable terms of sale :
Of all the forms of encouragement, the monetry incentive evokes
immediate response. Hence every producer must offer the most
responsible terms of sale such as longer periods of credit and higher rates
of descants.
4. Supplying suitable package and useful things.
5. By taking the return back.
6. By furnishing them with sales literature and display materials.
AGGRESSIVE SELLING
Meaning:
Goods are produced for market. Manufacturers have to make efforts to sell all they
produced. When the manufacturer uses various sales efforts to obtain increased sales
volume for his producer, it is calls as aggressive selling.
Aggressive Selling and Defensive Selling:
Aggressive selling is based on the answer to the question how much does the firm
again by using this method defensive selling is based on consideration as to how
much the firm will loss if it does not use this method increase of sale can be obtain
from two sources:-
1. New customer if the market is expending.
2. From the competitor i.e. those consumers who were purchasing similar product of
competiting firms, if the market for the product of competiting firm, if the market for
the product is static.
When aggressive selling is resorted?
Usually manufacturer of a new product has to do aggressive selling:
When the product has been improved.
When the manufacturer product is supervisor in quality to the product of the
established competitor.
When the total market for the product or line of product to expending.
If the manufacturer share of the market is comparatively small.
If the manufacturer has unused production capacity with heavy investment in
plant equipment, he will like to develop the demand for his product rapidly so
that demand for his product is equal to the optimum production capacity of his
plant.
When primary demand for a product must be created and provision must be
made in the channel of the distribution to educate consumer regarding the new
product and to instruct then in its use.
Method of aggressive selling:-
Sales promotion efforts use for aggressive selling may be divided in two classes.
Trade promotion
Consumer promotion
A. Trade promotion:-
Under trade promotion method special incentive are offered to the trader to buy
the product of the firms. Such incentive may take one or more of the following firm:-
1. Cash allowance :-
A definite percentage of allowed on the purchase of given
unit of product.
2. Extra product:-
Instead of giving any cash allowances extra product is given
with each unit of product ordered.
3. Gifts:-
Various gifts are awarded in return for an order of particular
magnitude.
B. Consumer Promotion:-
Under consumer promotion method special incentive are
offered to the consumer to buy the firm products. The prominent amongst such
incentives are as follows:-
1. Coupons :-
A coupon of giving value is sent to the consumer. By
presenting this coupon to the retailer consumer can purchase a particular product
mentioned on the coupon at the reduced price. The retailer sale the product
mentioned. In the coupon such consumer under an agreement with the manufacturer
at the price lower then the user retail price.
2. Self Liquidating Offers :-
Under this system the offers and articles at an attracting price
if the consumers sent a given sum of money accompanied by a given number of
box tops from the packages of a particular product the benefit to the consumer is
that he receives the articles at the bargain price.
3. Bargain Packs :-
Under this system the product sold at the reduced price for a
short period bargain pack method uncourageous new consumer to try the product. It is
also helpful in obtaining large display in the shop.
4. Sampling :-
This method involves the giving product or a small quantity of
the product to the consumer free with the hope that the costumer will be favorable
impressed with its actual use and till eventually become a regular purchaser for the
product.
Other method of aggressive selling:-
1. Employment of missionary salesmen also known as promotional salesman.
These salesman calls upon retailers and aggressive promote a product.
2. Instead of using wholesalers, the firm may develop own sales force to call
directly on retailers.
3. The firm may follow a compromise method by employing a manufacturer’s
agent and giving him a larger enough commission to increase to sale product
intensively and aggressively.
4. New territory exploitation sales promotion has a particularly important role in
developing the company’s product in new territory.
5. Increment and promotion.
6. Letters to dealer and customers.
Infact, an ingenious sales manager can device
any number of incentive scheme for promoting the sales volume.
Quality Circle
Quality circles consist of a small group of the people who perform same job or
task. These groups meet voluntarily on regular basis to discuss problems, seek
solutions and co-operate with management in the implementation of those solutions.
Quality circles operate on the principle that employee participation in decision-
making and problem solving improves the quality of work. Through the circle
members of the quality circle generates mutual respect and trust as they work on the
solution to common on –the job problem
Quality circle has several defining characteristics:
1. Participation in a quality circle is strictly voluntary.
2. Members of the circle set their own rules and priorities and select the problems
that are to be discussed.
3. Decisions are made by consensus. Open communication
is encouraged and negative criticism is discussed.
4. Quality circles utilize organized approaches to problem solving including brain
storming and cause & effect diagram.
Persons who act as a circle leader need to be familiar with other participative
management techniques.
OBJECTIVE OF QUALITY CIRCLE
The objective of quality circle is multiphase. So they can describe as follows:
A. Change in Attitude
From “I don’t care to I do care”.
B. Self development
Bring out hidden potential of the people and people get to learn additional things.
C. Development of team spirit.
“I could not do but we did it”.
D. Improved organization structure
E. High motivation level
F. Positive working Environment
G. Total involvement of people at all level.
PROCESS OF OPERATION
1. Problem Identification.
2. Problem Selection.
3. Problem Analysis.
4. Generate Alternative Solution.
5. Select most appropriate solution out of them.
6. Prepare Plan of action.
7. Implementation and Follow Up.
RESEARCH METHODOLOGY
Data collection:-
Primary data
Secondary data
1. Primary data:-
It is the data that is collected for the first time. It is fresh
and original collected by surveyors. In this particular study the researcher
contacted 50 customers and situated on the various point of the Rohtak.
Secondary Data:- Secondary data was collected from books, articles, Internet
and previous research papers that had been conducted by the company
representatives and officials.
Sample:-
A sample of 50 customers was chosen from Rohtak. The sample
was chosen fully on the basic of convenience of the researcher. It was non
probability sample.
Analysis and Interpretation:-
The total was presented in simple table graphs and percentage
method was used for interpretation.
1. Have you heard about the brand Parle ?
%Yes 57No 43
Yes57%
No43%
Yes No
2. Have you ever seen the advertisement of the Parle?
%Yes 40No 60
Yes40%
No60%
Yes
No
3. Where did you saw the advertisement?
%On T.V. 13In Magazin 4Hoarding 16Others 7Never See 60
On T.V.13%
In Magazin4%
Hoarding16%
Others7%
Never See60%
On T.V.
In Magazin
Hoarding
Others
Never See
4. Are u satisfied with sales promotion strategies done by Parle Pvt. Ltd.
%Yes 54No 40Partially 6
Yes54%
No40%
Partialy6%
Yes
No
Partialy
5. What do you think about the consistency of Parle Pricing strategies?
%Excellent 30Good 26Average 23Poor 21
Excellent30%
Good26%
Average23%
Poor21% Excellent
Good
Average
Poor
6. Which channel do you watch most frequently?
%Star plus 40DD 1 5Sony 25Zee T.V. 20Zee News. 10
Star plus40%
DD 15%
Sony25%
Zee T.V.20%
Zee News.10%
Star plus
DD 1
Sony
Zee T.V.
Zee News.
7. Which other advertisement can you recall?%
Britania 68Nestle 12Local 16Other 4
Britania68%
Nestle12%
Local16%
Other4% Britania
Nestle
Local
Other
8. Which advertisement is most consistent?
%Britania 48Nestle 40Local 8Other 4
9. Which brand in the taste the most frequently advertised on T.V?
%Britania 44Nestle 20Local 20Other 16
Britania44%
Nestle20%
Local20%
Other16% 0% Britania
Nestle
Local
Other
10 Have you purchase Parle product?
%Yes 44No 56
Yes44%
No56%
Yes
No
11.Are you satisfied with Parle product?
%Yes 64No 36
Yes64%
No36%
Yes
No
12.Have you attracted by the child picture on PARLE G packet?
%Yes 75No 25
Yes75%
No25%
Yes
No
13.Do you feel good when you see the advertisement of Parle?
%Yes 91No 9
Yes91%
No9%
Yes
No
Conclusions
1. Only less than 40% have seen advertisement of Parle.
2. Less than 50% satisfied with the advertisement information.
3. 55% customers are satisfied with the advertisement.
4. 79%are satisfied with the consistency of the Parle Advertisement.
5. 81% like musical advertising, where 8% like fantasy.
6. 56%said we haven’t purchased Parle product.
7. Only 36%said we are satisfied with Parle product.
8. 75% know the new product launched by Parle.
A Study of Sales Promotion Strategies of Parle Pvt. Ltd.
QUESTIONNAIRE
Name …………….. Age …………….. Rural…………Contact no. ………... E-mail…………... Urban…………
1. Have you heard about the brand Parle?
Yes……. No…….
2. Have you ever seen the advertisement of the Parle?
Yes……. No…….
3. Where you saw the advertisement?
On T.V……. In Magazine……. Hoarding…... Others………….
4. Are you satisfied with sales promotion strategies done by Parle Pvt. Ltd.? Yes……. No…….
5. What do you think about the consistency of Parle price? Excellent……. Good……. Average……... Poor……..
6. Which channel do you watch most frequently?
DD 1………… Star Plus……. Sony…………. Zee News…… Zee News……..
7. Which other advertisement can you recall?
Britania……. Nestle……… Local………... Other…………
8. Which company is most consistent in sales promotion activities?
Britania……. Nestle……… Local………... Other…………
9. Which brand in the taste most frequently advertised on T.V?
Britania……. Nestle……… Local………... Other…………
10. Have you purchase Parle product?
Yes……. No…….
11. Are you satisfied with Parle product?
Yes……. No…….
12. Have you attracted by the baby’s picture on Parle G packet? Yes……. No…….
13. Do you feel good when you see the advertisement of Parle?
Yes……. No…….
Bibliography:
Schultz, Don, Sales Promotion Essentials : The 10 Basic Sales Promotion Techniques… and How to Use Them, McGraw Hill, 2002.Hopkins, Tom, Selling for Dummies, NY Random House, 2001.Neslin, Scott, Sales Promotion, Prentice Hall, 2002.Shimp, Terence, Advertising, Promotion and Supplemental Aspects of Integrated Marketing Communications, Penguin books, 2001.Benun, Ilise, Self Promotion Online: Marketing Your Creative Services Using Web Sites, E-Mail and Digital Portfolios, Wiley and sons press, 2000.Mundy, Charles, Retail Advertising and Sales Promotion, McGraw Hill, 2002.Magee, Jeff, Sales Training Handbook, Prentice Hall, 2001.
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