Marketing Analysis for Business Decisions

MID TERM ASSIGNMENT

Name of the student: Prasad Laxman Naik Student Registration Number: PGD-BPT/Jun11/04 Name of the Module: Marketing Analysis for Business Decisions The program level: PGDGBL-I
Subject Tutor: Prof. Surendra

Date of Submission: Jan 11, 2011

Word Limit: 2000 Word Count: 1920

Check List
Serial No. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. Name Registration Number Date of Submission of the Assignment Is the cover page in the correct format as indicated in the guideline of writing assignment? Have I done the complete word count for the assignment? Does the table of content include numbers Are the pages numbered correctly Are the figures numbers numbered correctly Are the tables/charts numbered correctly Are the captions for the tables/Charts are proper? Are the reference/Bibliography listed in the assignment Are the reference cites adequately in the text? All the reference materials has been cites from books, journals and internet, the source quoted are vetted by the concerned tutor Particulars Remarks Prasad Laxman Naik PGD-BPT/Jun11/04 Jan 11, 2011 Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes

Are the references in the text in the proper format as indicated in the guideline to writing assignment? Has a soft copy of the assignment has been enclosed?

Declaration:
All materials written in this assignment is my own and I have not used any material, content, or information of others claiming them to be mine. Wherever materials have been used, proper citation has been done in the text. I am fully aware of rules and regulations governing plagiarism. Should at any point of the time my work is suspected/investigated and established to have been plagiarized. I am aware of the consequences. I have read the students handbook in detail.

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Objective
The given assignment of Marketing Analysis for Business Decisions (MABD) focuses on food industry and a comparative study of two retail giants The Gujarat Cooperative Milk Marketing Federation LTD and Baskin Robbins.

Product Category

The Global market for ice-creams is about 80 billion USD in terms of retail sales or 19 billion liters in terms of volume. Of this, the Asia-Pacific ice-cream market holds 17 billion USD in terms of retail sales 6500 million liters in terms of volume. Coming to India, the Indian icecream industry is currently estimated to be of Rs. 2500 Crores, and growing 12% approximately every year. Amul stands number one, with the market share of 38%, followed by Kwality Walls 14%, Vadilal 12%, Mother Dairy 8%, and remaining 28% is shared by small local industries. As shown in figure 1.1.

Amul Kwality Walls Vadilal Mother Dairy Others

Figure 1.1

The per capita consumption of ice-creams in India is just 300 ml per annum, compared to 22 litres in USA, 18 litres in Australia, 14 litres in Sweden. India is a way too far behind even in terms of the world average per capita ice cream consumption of 2.3 litres per annum. Pankaj Chaturvedi, ED. of Baskin Robins, explains Indian cuisine has a huge range of desserts in its mix. Ice cream always competes against these for attention. Besides desserts, ice cream also vies for attention with other like foods for example in summers with cold drinks, coffee, juice, etc. The peak season for ice cream still remains the summer months of April-June and dips in the months of November-February. According to experts, this trend especially holds true for the North and the Western parts of India. According to Mr. Chaturvedi, The variation in sales for Baskin Robins can range from 1530% from season to off season depending on geography and brand.

The Challenges
There are several challenges that affect the industry adversely. As mentioned earlier, the industry players not only face competition, but also from other like foods. Though changing, consumers still consider ice cream as a dessert and a side item. Sharing his experience, Mr. Jaiswal of Joos, says, We had introduced ice creams on an experimental basis in our juice outlets in Ahmadabad. We observed that consumers ordered ice creams as a side item or only when they were accompanied by children. We eventually decided not to move ahead with it. Moreover, of the ice cream consumption in India, nearly 60% is accounted to by three flavours of vanilla, strawberry and chocolate. And to be on the safer side, major players tend play around these flavours only.

Major problem faced by the industry players, while expansion, is poor infrastructure such lack of cold storage and in case of rural penetration, even power supply becomes an issue. Manish Vithalani says, Besides the presence of other players, another hurdle is the high rent charged, especially in malls. This becomes a concern when we expand.

Industry Brief

Gujarat Cooperative Milk Marketing Federation Ltd. (GCMMF) is India's largest food product marketing organization with annual turnover (2010-11) US$ 2.2 billion. Its daily milk procurement is approx 12 million liters/day from 3 million farmers. The Birth of Amul The seeds of this unusual saga were sown 65 years back in Anand, a small town in the state of Gujarat. Angered by unfair practices followed by the trade, the farmers of the district approached the great Indian patriot Sardar Vallabhbhai Patel. He advised them to form their own cooperative, which would have procurement, processing and marketing under their control. This co-operative, the Kaira District Co-operative Milk Producers Union Ltd. began with just two village dairy co-operative societies and 247 liters of milk and is today better known as Amul Dairy. Amul grew from strength to strength thanks to the inspired leadership of Tribhuvandas Patel, the founder Chairman and the committed professionalism of Dr Verghese Kurien.

The then Prime Minister of India, Lal Bahadur Shastri decided that the same principle should become the basis of a National Dairy Development policy. He studied the success of Amul could be attributed to four important factors. The The farmers owned the dairy; their elected representatives managed the district union. They employed professionals to operate the dairy and manage its business. co-operatives were sensitive to meet the needs and demands of farmers.

AMUL MODEL

"We sell fun, not just ice cream." Irv Robbins, co-founder.

For a long time two brothers-in-law shared a dream to create an innovative ice cream store that would be a gathering place for families. Burton "Burt" Baskin and Irvine "Irv" Robbins had a mutual love of old-fashioned ice cream and the desire to provide variety of flavors made with ingredients of the highest quality to customers. In 1945, Irv opened Snowbird Ice Cream in California. It featured 21 flavors and emphasized high-quality ice cream. A year later, Burt opened Burton's Ice Cream Shop in Pasadena. By 1948, they had 6 stores. This concept eventually turned into Baskin-Robbins. As the number of stores increased, they realized to maintain quality standards they had set would require a manager who had an ownership interest in its overall operation. Even though they didn't realize it at the time, they had pioneered the concept of franchising the ice cream industry. In 1954, Baskin-Robbins put their product on the line against their competitors at the Los Angeles County Fair and won their first Gold Medal and set the pattern for county and state fair participation, earning Gold Medals for Baskin-Robbins Ice Cream every year since that first contest. Baskin-Robbins continued to expand, and by the mid-1960s, the company had become an ice cream empire with more than 400 stores throughout the United States. In the 1970s the chain went international, opening stores in Japan, Saudi Arabia, Korea and Australia.

Market share of Amul and Baskin Robbins in India

Amul Baskin Robbins

Targeted Customer Segment for AMUL

The brand AMUL is marketed by GCMMF, Indias largest food marketing organization; it is a state level apex body of milk cooperatives in Gujarat which aims to provide remunerative returns to farmers and quality products for customers with value for money. Amul started in 1946 and has been growing since then. Markets then and even today are primitive and poor in infrastructure. GCMMF acknowledge this and felt the need of proactive intervention. Two key requirements where identified. Sustained growth for long term would depend on matching supply and demand. Effective management of network and commercial viability.

Amul Gold Chain Network

2.2 Million Members

10,675 Cooperative Societies

12 Units 10000 Employees

Marketing 700 Employees

Distribution 30000

Retailers 500,000

Intelligent Marketing

One of the most conservative FMCG entities, GCMMF spends mere 1% of its turnover on promotions. GCMMF has been inventing innovative ways of marketing and consumer approach Amul butter Girl is one of the longest running ad campaigns in the country for 46 years Moving customers from loose milk to packaged milk and slowly move them up the value chain Exposing customer to a brand, so they try different products Wide range of products for all segments of the society o Amul Kool targeted for childrens o Kool Caf targeted for youngsters o Butter and cheese for house olds consumption Changing retail environment o Striking its own outlet and parlous Having a wide portfolio of products, Amul promotes its brand in rotation of 2 to 3 years o Ice-creams where launched in 1996 and revisited in 1999 with improved availability and affordability o Cheese in 2001, Amul masti chaas in 2005.

Demographic and Social economic Factors

Market hold of AMUL has been very strong in India; the strength of AMUL is its availability in most of the retail outlets. They have placed all their products in a very affordable price. Amul has it specialty outlets in urban areas and have presence in modern trade like malls, shopping complex etc. They also have a very strong hold on rural market as well. The smaller packaging of ice-creams makes it more accessible for the rural community. This makes it more resistible to competition put forward by local players in rural areas.

Targeted Customer Segment for Baskin Robbins

The vision of Baskin Robbins has been to be THE BEST PREMIUM ICE CREAM PLAYER, and the mission is to trill customers, define and lead multi branding, enrich stake holders and build powerful brand image. The objective of Baskin Robbins has been to create brand awareness, create BR outlets everywhere, providing better value for stake holders

Segmentation, Targeting and Positioning

Segmentation and Target Demographic o BR is targeting all the age groups of the higher and middle class of the society. o Have a strong hold on brand integrity among youngsters of the higher class o Have their presence in malls and high foot traffic areas

success factors of Baskin Robbins

Innovation of New Flavors Quality control and customer service Brand image Global presence Excellent Distribution Network

Strategies
Short term Strategies Maintain constant intervals in advertising Sponsoring in community events Loyalty programs Cross branding

Long Term Strategies Increasing number of outlets Outsourcing in-stores Ads after building up chain Getting in shelfs of the supermarkets Building production unit in Malaysia- raw material & currency rates.

Marketing Mix of AMUL and BASKIN ROBBINS

Amul has a very good marketing mix with wide range of products starting from Ice-creams, chocolates, curds, butter milk, cheese, flavored milk and pizza base to name a few. The important point to be noted is that AMUL have been offering all their products in a affordable price range in the lower and middle segment of the society and most importantly value for money. The placement and availability of their products have always been at the highest level, their products are placed in urban, rural and international markets. Baskin Robbins has a very unique range of flavors in Ice-creams of the highest quality, these products are offered at high price range and people dont mind going for it looking at the quality of the products. Baskin Robbins offer Ice-creams, candys, sundaes, milk shakes and softies.

They have always been for the higher class of the society; they have stores all across the globe offering 31 unique flavors, as the tag line different flavor for each day of the month.

Analysis of parity and differentiation

Parity of Ice Creams is very unique as compared to other FMCG products, the expectation of its customers are almost similar in all segments of the society. The expectation that the customer expects from ice creams is it should be conveniently available, good packaging, variety of flavors, should be in conveniently size and value for money. Amul has been using good strategies for selling and placing their products. Their products are available for all the segment of the society. Baskin Robbins caters only to elite and higher class of the society. In countries like India, were the majority of the population is from middle class. Whereas, AMUL caters to all the segments of the society and hence more popular. Baskin Robbins has more varieties to offer compared to AMUL in the ice cream segment. Baskin Robbins has to concentrate on middle class segment in India. Baskin Robbins should also distribute their products in the other retail outlet to improve their distribution; Amul needs to improve their varieties in ice creams so establish themselves in the international market.

Links and Reference

http://en.wikipedia.org/wiki/Amul http://en.wikipedia.org/wiki/Baskin-Robbins http://en.wikipedia.org/wiki/Kwality_Wall%27s http://dare.co.in/opportunities/other-business-opportunities/ice-cream-industry-in-india.htm http://www.amul.com/m/about-us http://www.baskin-robbins.com/About/OurHistory.aspx http://www.authorstream.com/Presentation/Diptesh7375-507240-amul-marketing-strategy/ http://www.slideshare.net/anilkr123/amul-rural-marketing-presentation http://www.gazhoo.com/doc/200906270108397950/Amul++Marketing+Strategy+%26+Distribution+Methodology http://www.slideshare.net/mayankkkk/baskin-robbins-global-marketing/download