Food Processing Industry- Amul Vs. Mother Dairy 6f6g2a

Food processing industry- a comparative study between Amul and Mother Dairy (First draft)

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Anushka Bondal Tybms a Roll no 6634

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Food processing industry- a comparative study between Amul and Mother Dairy Table of contents Chapter one1.1 Executive summary 1.2 introduction 1.3 objectives of study 1.4 rationale of study 1.5 research methodology 1.6 Hypothesis Chapter two2.1 company profile 2.1.1 Amul India 2.1.2 Mother Dairy 2.2 quality control 2.2.1 Amul India 2.2.2 Mother Dairy 2.3 Product Portfolio 2.3.1 at Amul India 2.3.2 at Mother Dairy Chapter three3.1 comparison of selling prepositions 3.1.1 Product 3.1.2 Price 3.1.3 Place 3.1.4 Promotion Chapter four4.1 Swot Analysis 4.2 CSR Activities 4.2.1 Amul India Page | 2

4.2.2 Mother Dairy Chapter fiveAnalysis and Hypothesis Testing Chapter six6.1 Conclusion 6.2 Recommendations and Suggestions Annexure: Blank questionnaire

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Chapter One 1.1 Executive Summary Introduction to the project in of objectives of the study, company policies, company profiles which have been selected to be compared and about the product. Target companies: Amul India and Mother Dairy. This research project is based on the food processing industry with a focus on the way the target companies Amul and Mother Dairy work. The objective of the paper is to do a comparative analysis of Mother Dairy & Amul products. The paper contains a brief introduction of Mother Dairy limited & GCMMF limited and its various products. This paper clearly mentions objectives of study and research methodology utilized. The sources of information are both of primary data and secondary data. The data collection method used is structured non disguised questionnaire in which the types of questions used are multiple choice etc. The project contains a detailed view of the tasks, which have been undertaken to analyse the market of Mother Dairy & Amul products. A set of questionnaire has been prepared to know perceptions and preferences of the customers about dairy products and how they rate them.

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1.2 introduction Food processing industry The Indian food industry is ready for huge growth, increasing its contribution in world food trade every year. In India, the food sector has emerged as a high-profit sector on the back of the scope it offers for value addition, particularly with the food processing industry getting recognised as a high-priority area. ing for about 32 per cent of the country’s total food market, the food processing industry is one of the largest industries in India and is ranked fifth in of production, consumption, export and expected growth. Food processing is the transformation of raw ingredients, by physical or chemical means into food, or of food into other forms. Food processing combines raw food ingredients to produce marketable food products that can be easily prepared and served by the consumer. Food processing typically involves activities such as mincing, liquefaction, emulsification, and cooking (such as boiling, broiling, frying, or grilling); pickling, pasteurization, and many other kinds of preservation; and canning or other packaging. (Primary-processing such as dicing or slicing, freezing or drying when leading to secondary products are also included.) Food being perishable in nature has to be sometimes processed in order to increase its shelf life. Benefits of food processing include toxin removal, preservation, ease in marketing and distribution tasks, and increasing food consistency. In addition, it increases yearly availability of many foods, enables transportation of delicate perishable foods across long distances and makes many kinds of foods safe to eat by de-activating spoilage and pathogenic micro-organisms. Modern supermarkets would not exist without modern food processing techniques, and long voyages would not be possible. Processed foods are usually less susceptible to early spoilage than fresh foods and are better suited for long distance transportation from the source to the consumer. When they were first introduced, some processed foods helped to alleviate food shortages and improved the overall nutrition of populations as it made many new foods available to the masses. Processing can be done in dairy products, fruits, vegetables, cereals, pulses etc. The whole of industry is so huge, so this paper only covers one part of food processing that is the dairy industry.

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Indian dairy industry The dairy industry in India has been on a steady path of progression since Indian independence. India the world's largest milk producer, s for around 20 percent of global milk production, with most of it consumed domestically. In India, about 60 percent of milk is consumed in liquid form, while the remaining 40 per cent is used in the form of butter, clarified butter (desi ghee), cheese, curd, paneer, ice cream, dairy whiteners and traditional sweets. Since 90’s India is the largest producer of milk in the world, the fact remains even in 2014-2015. It also has the largest milk-producing animal population of over 118 million. The Indian dairy industry mainly got its boost after the ‘operation flood’, launched in 1970 which is a project of the national dairy development board (nddb), which was the world's biggest dairy development program. Operation flood's objectives included: 

Increase milk production ("a flood of milk")

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Augment rural incomes

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Fair prices for consumers.

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1.3 Objectives of Study  

To perform a comparative study between Amul and Mother Dairy. To understand the companies and their marketing strategies with the marketing mix.

1.4 Rationale of Study Both the companies, Amul and Mother Dairy being big brands in the dairy industry in India, and are also food processing companies with different products that are processed by them. Through the project we get to know what are the products offered, what are the marketing strategies of the companies, enabled by a comparative study between the two.

1.5 Scope of Study The research was done among people of Mumbai with a sample size of minimum 50 people.

1.6 Research Methodology Primary researchThe primary data has been collected with the help of a questionnaire, prepared specially for the consumers, istered for their responses

Secondary researchSecondary data was collected with the help of reference books, internet.

1.7 Hypothesis In order to test the competitiveness and market effectiveness of Amul and Mother Dairy, the following hypothesis has been tested; H1- Amul is preferred over Mother Dairy by the consumers of Mumbai.

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1.8Limitations of the study 1. Biasness of the respondents Some may or may not have revealed true information about their opinions regarding the companies. 2. Inaccurate access Risk of collecting incomplete and wrong information as people may be unable to understand. 3. Time consuming Collection of data, analysis, assembling of information from various sources is time consuming.

1.9 Literature review

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Chapter Two 2.1 Company Profiles 2.1.1 Amul India

Vision: Amul’s vision is to provide more and more satisfaction to the farmers, their customers, employees and distributers.

Mission: “we the motivated and dedicated workforce at Amul are committed to produce wholesome and safe foods of excellent quality to remain market leader through development of quality management system, state of art technology, innovation and eco-friendly operations to achieve delight of customers and milk producers”

The birth of Amul Amul was started when milk became a symbol of protest. It was founded in 1946 to stop the exploitation by middlemen, inspired by the freedom movement. The seeds of this unusual saga were sown more than 65 years back in Anand, a small town in the state of Gujarat in western India. The exploitative trade practices followed by the local trade cartel triggered off the cooperative movement. Angered by unfair and manipulative practices followed by the trade, the farmers of the district approached the great Indian patriot sardar vallabhbhai Patel for a solution. He advised them to get rid of middlemen and form their own co-operative, which would have procurement, processing and marketing under their control. In 1946, the farmers of this area went on a milk strike refusing to be cowed down by the cartel. Under the inspiration of sardar Patel, and the guidance of leaders like Page | 9

Morarji Desai and Tribhuvandas Patel, they formed their own cooperative in 1946. This co-operative, the kaira district co-operative milk producers union ltd. Began with just two village dairy co-operative societies and 247 litres 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, who was entrusted the task of running the dairy from 1950. The then prime minister of India, Lal Bahadur Shastri decided that the same approach should become the basis of a national dairy development policy. He understood that the success of Amul could be attributed to four important factors. The farmers owned the dairy, their elected representatives managed the village societies and the district union, they employed professionals to operate the dairy and manage its business. Most importantly, the cooperatives were sensitive to the needs of farmers and responsive to their demands. At his instance in 1965 the national dairy development board was set up with the basic objective of replicating the Amul model. Dr. Kurien was chosen to head the institution as its chairman and asked to replicate this model throughout the country.

Business model: the Amul model The Amul model of dairy development is a three-tiered structure with the dairy cooperative societies at the village level federated under a milk union at the district level and a federation of member unions at the state level.

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  

Establishment of a direct linkage between milk producers and consumers by eliminating middlemen. Milk producers (farmers) control procurement, processing and marketing. Professional management.

The Amul model has helped India to emerge as the largest milk producer in the world. More than 15 million milk producers pour their milk in 1, 44,500 dairy cooperative societies across the country. Their milk is processed in 184 district co-operative unions and marketed by 22 state marketing federations, ensuring a better life for millions.

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2.1.2 Mother Dairy fruit & vegetable pvt. Ltd. Brand name: Mother Dairy

Vision and mission

Vision – “provide quality food and beverages to consumers at affordable prices while ensuring fair returns to the producers.”

Mission – “Mother Dairy’s heritage is intrinsically linked to the cooperative movement in India. With determination & pride we will continue to serve our farmers, rural India & our consumers. Our values reflect who we are & what we firmly believe in.”

About Mother Dairy Mother Dairy was commissioned in 1974 as a wholly owned subsidiary of the national dairy development board (nddb). It was an initiative under operation flood, the world's biggest dairy development program launched to make India a milk sufficient nation. Over the years, Mother Dairy has contributed significantly in achieving this objective through a series of innovations and programs. Today, Mother Dairy manufactures, markets & sells milk and milk products including cultured products, ice creams, paneer and ghee under the Mother Dairy brand. The company also has a diversified portfolio with products in edible oils, fruits & vegetables, frozen vegetables, processed food like fruit juices, jams, pickles etc. To meet the daily requirements of every household. The company over the last many years has created a market position for itself in branded milk segment in India through a robust network of its booth and retail channels. It has also expanded its reach to other regions in north, south, east and west with its offering of milk and milk products pegging it among the few companies to own such a vast channel of distribution in India. Brand Mother Dairy sources a significant part of its requirement of liquid milk from dairy cooperatives and village level farmer centric organizations. The company is committed to uphold institutional structures that empower milk producers and farmers Page | 12

through processes that are equitable. A significant portion of its income is ploughed back into the value chain to and maintain the system.

2.2 quality control 2.2.1 at Amul India: Food safety policy: 

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The policy is to produce safe and wholesome food, to continually remain as the market leader by providing food products delighting customer expectations and bestow safety. Achieved by, improving raw milk quality, applying innovative technology for manufacturing food products. Employing quality and food safety management practices to, manufacture food products in a eco-friendly environment, meeting applicable statutory and regulatory requirements Effectively communicate and constantly improve professional skills of employees emphasizing continuous improvement of quality and food safety issues.

Hygiene and clean milk production drive:  

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The primary village dairy co-operative societies operate every morning and evening for the village farmers. Milk delivered by a producer is measured and a sample is drawn for a qualitytesting. Each centre is equipped with an electronic milk-tester for testing quality of milk, automatic weighing machine for weighing of milk with data processing facilities. The entire operation is electronically captured with member-id. Various training programmes, especially on quality management system, good management practises in animal husbandry are imparted on continuous basis to member producers, dairy co-operative personnel and personnel at dairy plants.

Bulk milk chillers: As a part of Amul’s quality movement bulk milk chillers are introduced at primary village co-operative society level. This system has drastically improved the microbiological quality of milk, therefore better return to farmers and good quality of products to consumers. Special trainings are imparted to dairy co-operative personnel for better management of bulk milk chillers. Road milk carriers: Page | 13

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The chilled milk of the co-operative societies are transported to Amul dairy plant through road milk tankers once in a day. These milk tankers are insulated to safeguard the quality of milk. A tanker carries three to four societies’ milk together which helps in achieving economy in transportation of milk. These tankers are thoroughly cleaned at every unloading of milk at dairy plant and certified for its hygiene for transportation of milk by QC personnel. This system has almost wiped out any possibility of spoilage to milk. Chilling milk at grass root level and transportation of the same in road milk tankers have reduced microbial load in raw milk which in turn has reduced processing costs in of energy, thereby better return to farmer producers. Geo-remote sensing based vehicle tracking system has been put in use for efficient handling of road milk tankers carrying milk to dairy plant.

2.2.2 at Mother Dairy: Milk They are committed to: • apply state of the art technology and processes to enhance productivity that ensures quality at competitive price. • apply processes for clean production, pollution prevention and optimize resource utilization in all operations. • follow food safety management system and apply HAC (hazard analysis critical control points) principles to Provide safe products to customers. • develop and empower employees for maintaining a vibrant work environment, which encourages excellence. • comply with applicable regulations and legislations. Fruit & vegetable They strive to achieve this goal through: • facilitating a direct link between farmers and the consumer • developing a network of farmers / suppliers committed to improve quality, productivity & safe agricultural practices. • efficient utilization of resources through continuous focus on reducing waste & non value adding activities • identifying & applying innovative practices & state of the art technology • developing empowered & motivated workforce , committed to quality & continual improvement Page | 14

• helping employees and farmers to upgrade their skills by providing training and exposure to food safety systems • ensuring food safety through effective implementation of food safety systems and complying with statutory and regulatory requirements. Fruit pulp & concentrate To achieve a significant market share and popularize consumption of Indian tropical fruit products in national & international markets and provide opportunities for the growth of Indian farm produce Quality policy is to: • constantly strive to understand and meet the ever growing needs of the customer • meet national and international standards in processes and products ensuring consistently high level of quality • constantly maintain highest level of cleanliness hygiene and practice hazard free operations • utilize state-of- art technology in handling and processing of fruits and fruit products • forge a unique relationship with farmers for mutual benefits The success of this policy shall be realized through trained and competent employees who shall work as well knit team and have the requisite empowerment to discharge their individual and collective responsibilities Quality process Procurement: Fresh milk is sourced directly from state level co-operatives and Mother Dairy own new generation co-operatives (NGC). Milk received from individual producer is checked for all basic quality parameters meeting company specifications & requirements at respective collection & chilling centres. Milk is then supplied to the dairy units through insulated milk tankers under refrigerated conditions to maintain the freshness. Strict quality checks are performed for all incoming milk received at dairy units. Commodities, ingredients & packaging material used for the products are checked, approved and released by quality functions as per company specifications and requirements.

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2.3 Product Portfolio: 2.3.1 Amul India: Milk

Amul gold, Amul taaza, Amul slim trim milk, Amul chai maza

Bread spreads

Amul butter, Amul lite, table margarine, Amul cooking butter

Cheese

Amul processed cheese, Amul emmental cheese, Amul Gouda cheese, Amul cheese spread

UHT (ultra high temperature) milk

Amul gold, Amul taaza, Amul slim trim, Amul calci

Beverage range

Amul Kool flavoured milk, Amul Kool café, Amul Kool koko, Amul stamina

Amul pro

Amul pro range of whey protein malt beverage

Ice cream

Flavoured ice creams

Paneer

Amul malai paneer, Amul fresh paneer

Dahi

Amul masti dahi, Amul probiotic dahi, Amul flaavyo (flavoured yoghurt)

Ghee

Amul ghee, sagar ghee, Amul yellow (cow) ghee, Amul brown

Milk powders

Amul spray, Amulya, sagar skimmed milk powder, sagar tea coffee whitener

Mithai range

Amul shrikhand, gulab jamun, Amul basundi, Amul avsar laddoo

Mithai mate

Amul mithai mate (condensed milk)

Chocolates

Amul chocolate, Amul chocozoo, chocolate syrup, wafer chocolate

Fresh cream

Amul whipping cream, Amul fresh cream

Butter milk

Amul masti chaas, Amul chaas

Amul cattle feed

Amul cattle feed

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2.3.2 Mother Dairy: Milk

Token milk, full cream milk, toned milk, standardised milk, skimmed milk, UHT toned milk,

Dairy products

Plain dahi, probiotic dahi, mishti doi, cheese, lassi, salted lassi, plain chaas, tadka chaas, butter, fresh paneer.

Mother Dairy chillz

Chocolate, kesar elaichi, coffee, vanilla

Ghee

Buffalo ghee, cow ghee, kathiawadi ghee

Others

Yoghurt, milk cake, rosogulla, gulab jamun, kheer, khoya, UHT cream, dairy whitener, milkshakes.

Ice creams

Different flavours in tubs, family packs, candies

Edible oils under brand name “Dhara”

Vegetable oil, rice bran oil, cottonseed oil, groundnut oil, kacchi ghani mustard oil, mustard oil

Fresh fruits and vegetables

Fresh fruits, fresh vegetables

Frozen food

Frozen peas, frozen corn, frozen mix veg, corn chatkara, frozen aloo tikka

Juices and fruit beverages under brand name “Safal”

Different flavours of fruit juices

Processed foods

Jams and pickles

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Chapter Three 3.1 comparison of selling prepositions 3.1.1 Product At the heart of a great brand is a great product. Product is a key element in the market offering. To achieve market leadership, firms must offer products and services of superior quality that provide unsured customer value. We define a product as anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need. Products include more than just tangible objects, such as cars, computers, or cell phones. Broadly defined, “products” also include services, events, persons, places, organizations, ideas, or a mixture of these. Throughout this text, we use the term product broadly to include any or all of these entities. Thus, an apple iPhone, a Toyota Camry, and a café mocha at Starbucks are products. But so are a trip to Las Vegas, E*TRADE online investment services, and advice from your family doctor. Because of their importance in the world economy, we give special attention to services. Services are a form of product that consists of activities, benefits, or satisfactions offered for sale that are essentially intangible and do not result in the ownership of anything. Examples include banking, hotel services, airline travel, retail, wireless communication, and home repair services.

Product classifications Products fall into two broad classes based on the types of consumers that use them: consumer products and industrial products. Broadly defined, products also include other marketable entities such as experiences, organizations, persons, places, and ideas.

Consumer products consumer products are products and services bought by final consumers for personal consumption. Marketers usually classify these products and services further based on how consumers go about buying them. Consumer products include convenience products, shopping products, specialty products, and unsought products. These products differ in the ways consumers buy them and, therefore, in how they are marketed. 1. Convenience products- convenience products are consumer products and services that customers usually buy frequently, immediately, and with minimal comparison and buying effort. Examples include laundry detergent, candy, magazines, and fast food. Convenience products are usually low priced, and marketers place them in many locations to make them readily available when customers need or want them. 2. Shopping products- shopping products are less frequently purchased consumer products and services that customers compare carefully on suitability, quality, price, and style. When buying shopping products and services, consumers spend much time and effort in gathering information and making comparisons. Examples include Page | 18

furniture, clothing, used cars, major appliances, and hotel and airline services. Shopping products marketers usually distribute their products through fewer outlets but provide deeper sales to help customers in their comparison efforts. 3. Speciality products- speciality products are consumer products and services with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort. Examples include specific brands of cars, high-priced photographic equipment, designer clothes, and the services of medical or legal specialists. A Lamborghini automobile, for example, is a speciality product because buyers are usually willing to travel great distances to buy one. Buyers normally do not compare speciality products. They invest only the time needed to reach dealers carrying the wanted products. 4. Unsought products- unsought products are consumer products that the consumer either does not know about or knows about but does not normally consider buying. Most major new innovations are unsought until the consumer becomes aware of them through advertising. Classic examples of known but unsought products and services are life insurance, pre-planned funeral services, and blood donations to the Red Cross. By their very nature, unsought products require a lot of advertising, personal selling, and other marketing efforts.

Industrial productsindustrial products are those purchased for further processing or for use in conducting a business. Thus, the distinction between a consumer product and an industrial product is based on the purpose for which the product is purchased. If a consumer buys a lawn mower for use around home, the lawn mower is a consumer product. If the same consumer buys the same lawn mower for use in a landscaping business, the lawn mower is an industrial product. The three groups of industrial products and services include materials and parts, capital items, and supplies and services. 1. Materials and parts- include raw materials and manufactured materials and parts. Raw materials consist of farm products (wheat, cotton, livestock, fruits, vegetables) and natural products (fish, lumber, crude petroleum, iron ore). Manufactured materials and parts consist of component materials (iron, yarn, cement, wires) and component parts (small motors, tires, castings). Most manufactured materials and parts are sold directly to industrial s. Price and service are the major marketing factors; branding and advertising tend to be less important. 2. Capital items- include industrial products that aid in the buyer’s production or operations, including installations and accessory equipment. Installations consist of major purchases such as buildings (factories, offices) and fixed equipment (generators, drill presses, large computer systems, and elevators). Accessory equipment includes portable factory equipment and tools (hand tools, lift trucks) and office equipment (computers, fax machines, desks). They have a shorter life than installations and simply aid in the production process. 3. Supplies and services- supplies include operating supplies (lubricants, coal, paper, pencils) and repair and maintenance items (paint, nails, brooms). Supplies are the Page | 19

convenience products of the industrial field because they are usually purchased with a minimum of effort or comparison. Business services include maintenance and repair services (window cleaning, computer repair) and business advisory services (legal, management consulting, and advertising). Such services are usually supplied under contract.

Product Amul Amul has a very strong product portfolio. Amul product portfolio is comprised mainly of dairy products. Amul butter, Amul cheese and Amul ice cream are cash cows for Amul as they have the major market share in their product category. Amul ice cream is amongst the top 10 ice cream brands of India. Amul milk, Amul paneer and Amul dahi consumption is on the rise. In fact Amul milk has 26% of market share in the packaged milk segment. The only disappointing performance is seen in Amul chocolates which are a burden for Amul and lot of push is required for the sales of the same. This is because the chocolate market has established players like Parle, dairy milk and others. The Amul family tree has the following brands – Amul milk, Amul bread spreads, Amul cheese, Amul milk, Amul Kool and its variants, Amul pro, Amul ice cream, Amul paneer, Amul dahi, Amul ghee, Amul milk powders, Amul nutramul, Amul mithai range, Amul mithai mate, Amul chocolates, Amul butter milk. Thus the product portfolio of Amul considering its dairy origins is astounding. Amul has various competitors based on different products. In ice cream it is vadilal, dinshaws and

Mother Dairy Mother Dairy has a strong product portfolio. The portfolio along with dairy products, consists of edible oils, jams, pickles, fruit juices and beverages under the brand names, ‘Dhara’ and ‘Safal’ respectively. Mother Dairy milk, dahi, ice creams are consumed largely, while ghee and sweets require the push strategy. Competitors for the same are sagar and gowardhan ghee which is preferred by people. The Mother Dairy tree has the following brands – token milk, full cream milk, toned milk, standardised milk, skimmed milk, UHT toned milk, Plain dahi, probiotic dahi, mishti doi, lassi, salted lassi, plain chaas, tadka chaas, butter, fresh paneer. Different flavours in tubs, family packs, candies Vegetable oil, rice bran oil, cottonseed oil, groundnut oil, kacchi ghani mustard oil, mustard oil Frozen peas, frozen corn, frozen mix veg, corn chatkara, frozen aloo tikka Different flavours of fruit juices Jams and pickles

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havmor. In butter and milk there is Mother Dairy, britannia and others. However, no competitor has such a vast dairy based product portfolio as Amul. This is the major reason that Amul has a sustainable competitive advantage over its competitors.

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3.1.2 Price: In the narrowest sense, price is the amount of money charged for a product or a service. More broadly, price is the sum of all the values that customers give up to gain the benefits of having or using a product or service. Historically, price has been the major factor affecting buyer choice. In recent decades, non-price factors have gained increasing importance. However, price still remains one of the most important elements that determines a firm’s market share and profitability. Price is the only element in the marketing mix that produces revenue; all other elements represent costs. Price is also one of the most flexible marketing mix elements. Unlike product features and channel commitments, prices can be changed quickly. At the same time, pricing is the number-one problem facing many marketing executives, and many companies do not handle pricing well. Some managers view pricing as a big headache, preferring instead to focus on other marketing mix elements. However, smart managers treat pricing as a key strategic tool for creating and capturing customer value. Prices have a direct impact on a firm’s bottom line. A small percentage improvement in price can generate a large percentage increase in profitability. More importantly, as part of a company’s overall value proposition, price plays a key role in creating customer value and building customer relationships. “Instead of running away from pricing,” says an expert, “savvy marketers are embracing it.”

Types of pricing strategies There are a number of pricing strategies that a company can use to sell its product. The strategy used at any time will depend on the company’s strategy and objectives. Some of these pricing strategies are the following.

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1. Penetration pricing A low price is set by the company to build up sales and market share. This may be done to establish position in a market with preexisting similar products on offer. Once a position is created, the prices may be raised. A satellite channel provider may offer an introductory price and then increase as business grows. 2. Skimming pricing Here, the initial price is set high and may slowly be brought down. This will allow the company to introduce the product step by step to different layers of the market. Electronic and tech gadgets often start at a very high price which is subsequently lowered with the lowest point reached right before a new model is launched. 3. Competition pricing When trying to go head to head with competitors offering similar benefits, a company may decide to: a. Price higher to create a higher quality perception or to target a niche market b. Price the same to show more benefits for the same price c. Price lower to try to gain a wider customer base 4. Product line pricing Here, different products in the same range may be set at different prices. Television sets are priced differently depending on whether they are HD or not, whether they have Wi-Fi features of not and whether they are 3d or not. 5. Bundle pricing A group of products may be bundled together and sold at a reduced price. Supermarkets often use this method through their ‘buy one get one free’ offers. 6. Psychological pricing Often a company will make small changes to prices to make a customer think the item is priced lower than it is. This is often seen in prices ending in 99. For example, an item market 199 will be perceived as closer in price to 100 than 200. 7. pricing A high price is set to establish an exclusive product of high quality. Designer cars and brand stores are a good example of this type of pricing. 8. Optional pricing Page | 23

A company may add optional extra items within the price to increase a product’s attractiveness. Car sellers may offer car insurance for the first year for example. 9. Cost based pricing Simply, a company may determine the exact cost of producing and selling an objective, add a markup that may be desirable for profits and price accordingly. This method may be used in a changing industry where even costs of production are unpredictable. 10. Cost plus pricing A percentage is added to the costs as a profit margin to determine final price.

Price Amul Amul has a strategy of low cost pricing. Some may call it penetrative pricing. But penetrative pricing strategy is used when the market has a high level of competition and a player wants to establish itself in the market by giving low prices. However, in the case of Amul, when Amul started, there were no national players and the dairy market was unorganized. During the introduction stage itself, Amul had a vision to provide their products to end customers at the best affordable rates. And the same vision is in place even today. Today also, you will find that Amul butter, milk and cheese are available at affordable prices keeping in mind the end customers. You may call these products costly, but the cost has nothing to do with Amul’s strategy. that transportation costs as well as storage and distribution costs are very high in FMCG. Thus, as the cost of transportation, storage and distribution has increased over the years, so has the

Mother Dairy Mother Dairy already had its competitor Amul in the market when it entered. So the pricing strategy required was competitive strategy. This strategy is used when a company wants to break in the competition and create a place for itself. Amul has its pricing reasonable, so in order to keep up with them, Mother Dairy has the pricing reasonable to attract customers.

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cost of Amul products gone up. But considering their value for the average India consumer, these products are still priced at an affordable rate.

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3.1.3 Place: In the marketing mix, the process of moving products from the producer to the intended is called place. In other words, it is how your product is bought and where it is bought. This movement could be through a combination of intermediaries such as distributors, wholesalers and retailers. In addition, a newer method is the internet which itself is a marketplace now. Through the use of the right place, a company can increase sales and maintain these over a longer period of time. In turn, this would mean a greater share of the market and increased revenues and profits. Correct placement is a vital activity that is focused on reaching the right target audience at the right time. It focuses on where the business is located, where the target market is placed, how best to connect these two, how to store goods in the interim and how to eventually transport them.

Distribution channelDistribution channel intermediaries are middlemen who play a crucial role in the distribution process. These middlemen facilitate the distribution process through their experience and expertise. There are four main types of intermediaries: 1. Agents the agent is an independent entity who acts as an extension of the producer by representing them to the . An agent never actually gains ownership of the product and usually make money from commissions and fees paid for their services. 2. Wholesalers wholesalers are also independent entities. But they actually purchase goods from a producer in bulk and store them in warehouses. These goods are then resold in smaller amounts at a profit. Wholesalers seldom sell directly to an end . Their customers are usually another intermediary such as a retailer. 3. Distributors similar to wholesalers, distributors differ in one regard. A wholesaler may carry a variety of competition brands and product types. A distributor however, will only carry products from a single brand or company. A distributor may have a close relationship with the producer. 4. Retailers wholesalers and distributors will sell the products that they have acquired to the retailer at a profit. Retailers will then stock the goods and sell them to the ultimate end at a profit. Page | 26

Distribution strategies Depending on the type of product being distributed there are three common distribution strategies available: 1. Intensive distribution- used commonly to distribute low priced or impulse purchase products e.g. Chocolates, soft drinks. 2. Exclusive distribution- involves limiting distribution to a single outlet. The product is usually highly priced, and requires the intermediary to place much detail in its sell. An example of would be the sale of vehicles through exclusive dealers. 3. Selective distribution- a small number of retail outlets are chosen to distribute the product. Selective distribution is common with products such as computers, televisions household appliances, where consumers are willing to shop around and where manufacturers want a large geographical spread. If a manufacturer decides to adopt an exclusive or selective strategy they should select an intermediary which has experience of handling similar products, credible and is known by the target audience.

Place Amul Amul has a massive distribution network because its ice creams, milk, butter and cheese is found practically everywhere. As it is a FMCG product, Amul follows the methodology of breaking the bulk. The initial factory output is in bulk. Later on this bulk becomes smaller and smaller and finally one individual slab of butter or scoop of ice cream is sold at the retail place. There are two different channels through which distribution happens in Amul. One is the procurement channel which is responsible for collection of milk through dairy cooperatives. The other is the distribution channel which is responsible for distributing the finalized product to the end customers. In the procurement channel, the milk is

Mother Dairy Mother Dairy has a huge distribution network, but products are found in lesser places as compared to Amul. Mother Dairy also follows the practice of breaking bulk. From the factory to distribution centres and to the retailers, the bulk reduces to sale of single units of their products. Their products are marketed through a chain of their own milk shops, retail outlets and mobile vending units maintaining best-in-class hygiene standards. They ensure that products are available, displayed appropriately and cold chain conditions are maintained to retain product quality & freshness.

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individually delivered from farmers to the cooperatives. The cooperatives then collect all this milk and send the bulk to the manufacturing facility. At the manufacturing facility, the milk is used to manufacture the finalized products. In the distribution channel, there are carrying and forwarding agents, distributors, dealers and retailers involved. There are also Amul Shoppe’s which sell all products in the Amul product portfolio. The distribution is as follows. Amul >> carrying and forwarding agent >> distributor >> dealer / retailer / Amul shopper >> customer Amul >> modern retail Thus there is a lot of transportation involved for all of Amul’s products. However, the distribution channel of Amul ensures that the products reach every nook and corner of India.

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3.1.4 Promotion: Promotion is the communication aspect of the marketing mix. It is creating a channel for conversation with the targeted consumer base. Through promotion, the company aims to attract the customer’s attention and give them enough information about the product to foster enough interest to motivate them to purchase. The team tasked with these activities will begin by understanding the dynamics of the target audience and deciding which modes of promotion are likely to help meet targets. Once the channel is decided, information from other elements of the mix is incorporated to ensure that the message sent corresponds to the actual product features, benefits and experience. None of the elements of the marketing mix work in isolation. Instead a unified body of information acts as the source for all activities within these 4p’s. The available information is filtered to include those areas which will be most relevant to the target audience.

A company’s total promotion mix—also called its marketing communications mix— consists of the specific blend of advertising, public relations, personal selling, sales promotion, and direct-marketing tools that the company uses to persuasively communicate customer value and build customer relationships. The five major promotion tools are defined as follows:

1

Advertising – this mode of promotion is usually paid, with little or no personal message. Mass media such as television, radio or newspapers and magazines is most often the carrier of these messages. Apart from these, billboards, posters, web pages, brochures and direct mail also fall in the same category. While this method has traditionally been one sided, ment over new media such as the internet may allow for quick .

2

Public relations & sponsorship – PR or publicity tries to increase positive mention of the product or brand in influential media outlets. These could include newspapers, Page | 29

magazines, talk shows and new media such as social networks and blogs. This could also mean allowing super s, or influencers to test the product and speak positively about it to their peers. This type of ment may or may not be paid. For example, sponsoring a major event and increasing brand visibility is a paid action. Sending free samples to a blogger then depends on their discretion and opinion and is not usually swayed by payment. 3

Personal selling – opposite of the one directional promotional methods, direct selling connects company representatives with the consumer. These interactions can be in person, over the phone and over email or chat. This personal aims to create a personal relationship between the client and the brand or product.

4

Direct marketing – this channel targets specific influential potential s through telemarketing, customized letters, emails and text messages.

5

Sales promotions – these are usually short term strategic activities which aim to encourage a surge in sales. These could be ‘buy one get one free’ options, seasonal discounts, contests, samples or even special coupons with expiration dates.

Promotion Amul Amul is responsible for one of the most unique and longest running outdoor campaign as well as one of the most known outdoor advertising characters – the Amul girl. But we should know by now that the Amul girl is hardly sweet or cute. She is known to be the naughtiest advertising girl ever. Amul hoardings mainly feature the current news and are used to take a tongue in cheek viewpoint at current happenings. However, each ment hits the nail on the head. The promotions of Amul are mainly for butter but for all the other products there is hardly any promotions. During the launch of products, Amul is known to go

Mother Dairy ment and product promotion strategy it's trying to take its product campaigns and communications to a higher platform. It targets children and are created around ideas such as "the country needs you, grow faster". For products such as butter, cheese and ice creams go, the campaigns have been created around "taste". Since 60 per cent butter is consumed by kids, they have created makkhan singh, a cartoon character cow as its brand ambassador.

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atl and milk, butter etc. The smita patil ad wherein smita patil is shown as a village milk collector is one of the most famous ads for Amul. But overall, the main ment is btl through outdoor, trade promotions, discount schemes and sales promotions. The major reason for Amul’s absence in hardcore advertising is that Amul does not want to give away margins in advertising its products. As per Amul, their maximum budget for advertising is 1% of the turnover. Above and beyond that will directly affect the cost of the product. And the major reason for Amul’s strong presence in the market is its excellent quality combined with the affordable price. Thus, overall promotions will always be low for Amul except for the outdoor advertising of Amul butter.

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Different ads from Amul as means of promotion through outdoor advertising

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3.2 BCG matrix of both companies BCG(Boston Consulting Group) matrix More than 40 years after Bruce Henderson proposed BCG’s growth-share matrix, the concept is very much alive. Companies continue to need a method to manage their portfolio of products, R&D investments, and business units in a disciplined and systematic way. Harvard Business Review recently named it one of the frameworks that changed the world. The matrix is central in business school teaching on strategy. At the same time, the world has changed in ways that have a fundamental impact on the original intent of the matrix: since 1970, when it was introduced, conglomerates have become less prevalent, change has accelerated, and competitive advantage has become less durable. Given all that, is the BCG growth-share matrix still relevant? Yes, but with some important enhancements. The matrix helped companies decide which markets and business units to invest in on the basis of two factors—company competitiveness and market attractiveness—with the underlying drivers for these factors being relative market share and growth rate, respectively. The logic was that market leadership, expressed through high relative share, resulted in sustainably superior returns. In the long run, the market leader obtained a self-reinforcing cost advantage through scale and experience that competitors found difficult to replicate. High growth rates signalled the markets in which leadership could be most easily built. Putting these drivers in a matrix revealed four quadrants, each with a specific strategic imperative. Low-growth, high-share “cash cows” should be milked for cash to reinvest in high-growth, high-share “stars” with high future potential. High-growth, low-share “question marks” should be invested in or discarded, depending on their chances of becoming stars. Low-share, low-growth “pets” are essentially worthless and should be liquidated, divested, or repositioned given that their current positioning is unlikely to ever generate cash. The utility of the matrix in practice was twofold: 

The matrix provided conglomerates and diversified industrial companies with a logic to redeploy cash from cash cows to business units with higher growth potential. This came at a time when units often kept and reinvested their own cash—which in some cases had the effect of continuously decreasing returns

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on investment. Conglomerates that allocated cash smartly gained an advantage. 

It also provided companies with a simple but powerful tool for maximizing the competitiveness, value, and sustainability of their business by allowing them to strike the right balance between the exploitation of mature businesses and the exploration of new businesses to secure future growth

The four segments of the BCG Matrix Placing products in the BCG matrix provides 4 categories in a portfolio of a company: 1) Stars (high growth, high market share) a) Stars are using large amounts of cash. Stars are leaders in the business. Therefore they should also generate large amounts of cash. b) Stars are frequently roughly in balance on net cash flow. However if needed any attempt should be made to hold your market share in Stars, because the rewards will be Cash Cows if market share is kept. 2) Cash Cows (low growth, high market share) a) Profits and cash generation should be high. Because of the low growth, investments which are needed should be low. b) Cash Cows are often the stars of yesterday and they are the foundation of a company. 3) Dogs (low growth, low market share) a) Avoid and minimize the number of Dogs in a company. b) Watch out for expensive ‘rescue plans’. c) Dogs must deliver cash, otherwise they must be liquidated. 4) Question Marks (high growth, low market share) a) Question Marks have the worst cash characteristics of all, because they have high cash demands and generate low returns, because of their low market share. b) If the market share remains unchanged, Question Marks will simply absorb great amounts of cash. Either invest heavily, or sell off, or invest nothing and generate any cash that you can. Other uses and benefits of the BCG Matrix 1. If a company is able to use the experience curve to its advantage, it should be able to manufacture and sell new products at a price that is low enough to get early market share leadership. Once it becomes a star, it is destined to be profitable. 2. BCG model is helpful for managers to evaluate balance in the firm’s current portfolio of Stars, Cash Cows, Question Marks and Dogs. 3. BCG method is applicable to large companies that seek volume and experience effects. Page | 35

4. The model is simple and easy to understand. 5. It provides a base for management to decide and prepare for future actions. Limitations of the BCG Matrix Some limitations of the Boston Consulting Group Matrix include: 1. 2. 3. 4. 5. 6. 7. 8.

It neglects the effects of synergy between business units. High market share is not the only success factor. Market growth is not the only indicator for attractiveness of a market. Sometimes Dogs can earn even more cash as Cash Cows. The problems of getting data on the market share and market growth. There is no clear definition of what constitutes a "market". A high market share does not necessarily lead to profitability all the time. The model uses only two dimensions – market share and growth rate. This may tempt management to emphasize a particular product, or to divest prematurely. 9. A business with a low market share can be profitable too. 10. The model neglects small competitors that have fast growing market shares. 11.

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3.2.1 BCG matrix of Amul:

Stars- ice creams and cheese are the most sold and popular products of Amul. Their market share as well market growth is also high. UHT milk like Amul taaza is also gaining popularity among the consumers due to its ready to consume properties. Flavoured milk is quite popular among the children. Cash cows- the most income generating products of Amul are Amul butter and Amul milk in pouches. When consumers go out in the market to buy butter, it has become synonymous with Amul butter. Amul milk is also readily available with the vendors. The market growth of these products may be low, but the market share is really high due to constant purchase and customer loyalty. Question marks- Amul chocolates are not that popular in the market because of its major competition from Cadbury.

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3.2.2 BCG matrix of Mother Dairy

Stars- ice-creams from Mother Dairy under the name chillz is gaining popularity and the variants under chillz are many. Mother Dairy cheese is also popular along with Amul and Britannia cheese. Any purchase of frozen foods, the consumers prefer to buy Safal products. Dhara oils have been in the market since a very long time. Cash cows- pouch milk and dahi of Mother Dairy have a tough competition from Amul, and local brands from Maharashtra like Chitale and Gowardhan. The sales of these products are almost equivalent to those of Amul, and maximum sales are carried out for milk and dahi Question marks- consumers prefer to buy Amul, gowardhan ghee in place of Mother Dairy ghee.

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Chapter Four 4.1 SWOT Analysis: The overall evaluation of a company’s strengths, weaknesses, opportunities, and threats is called swot analysis. It’s a way of monitoring the external and internal marketing environment.

External environment (opportunity and threat) analysis: A business unit must monitor key macro environment forces and significant microenvironment factors that affect its ability to earn profits.it should set up a marketing intelligence system to track trends and important developments and any related opportunities and threats. Good marketing is the art of finding, developing, and profiting from these opportunities. Marketing opportunity is an area of buyer need and interest that a company has a high probability of profitably satisfying. There are three main sources of market opportunities. The first is to offer something that is in short supply. This requires little marketing talent, as the need is fairly obvious .the second is to supply an existing product or service in a new or superior way. How? The problem detection method asks consumers for their suggestions, the ideal method has them imagine an ideal version of the product or service, and the consumption chain method asks them to chart their steps in acquiring, using, and disposing of a product. This last method often leads to a totally new product or service. Marketers need to be good at spotting opportunities. Consider the following: 1. A company may benefit from converging industry trends and introduce hybrid products or services that are new to the market. 2. A company may make a buying process more convenient or efficient. 3. A company can meet the need for more information and advice. 4. A company can customize a product or service 5. A company can introduce a new capability 6. A company may be able to deliver a product or service faster 7. A company may be able to offer a product at a much lower price. To evaluate opportunities, companies can use market opportunity analysis (moa) to ask questions like: 1. Can we articulate the benefits convincingly to a defined target market(s)? 2. Can we locate the target market(s) and reach them with cost-effective media and trade channels? 3. Does our company possess or have access to the critical capabilities and resources we need to deliver the customer benefits? 4. Can we deliver the benefits better than any actual or potential competitors?

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5. Will the financial rate of return meet or exceed our required threshold for investment?

Internal environment (strengths and weaknesses) analysis: Internal factors include your resources and experiences. General areas to consider: 1. Human resources - staff, volunteers, board , target population 2. Physical resources - your location, building, equipment 3. Financial - grants, funding agencies, other sources of income 4. Activities and processes - programs you run, systems you employ 5. Past experiences - building blocks for learning and success, your reputation in the community Don't be too modest when listing your strengths. If you're having difficulty naming them, start by simply listing your characteristics (e.g., we're small, we're connected to the neighborhood). Some of these will probably be strengths. Although the strengths and weakness of your organization are your internal qualities, don't overlook the perspective of people outside your group. Identify strengths and weaknesses from both your own point of view and that of others, including those you serve or deal with. Do others see problems--or assets--that you don't? How do you get information about how outsiders perceive your strengths and weaknesses? You may know already if you've listened to those you serve. If not, this might be the time to gather that type of information.

Strengths

Amul

Mother Dairy

1. Demand profile: absolutely optimistic.

1.awell-recognized brand name

2. Margins: quite reasonable, even on packed liquid milk.

2. Popular subsidiary brands like Dhara, Safal, b-activ, etc.

3. Flexibility of product mix: tremendous. With balancing equipment, you can keep on adding to

3.a wide variety of products like milk, dairy Page | 40

your product line. 4. Availability of raw material: abundant. Presently, more than 80 per cent of milk produced is flowing into the unorganized sector, which requires proper channelization.

products, fruits, vegetables, groceries, edible oil, beverages, frozen food, etc. 4.strong and efficient supply chain network 5.procurement of milk from co-operative dairies and vegetables from farmers, providing them with fair prices 6. Technological advancement

Weaknesses

1. Perishability: pasteurization has overcome this weakness partially. UHT gives milk long life. Surely, many new processes will follow to improve milk quality and extend its shelf life. 2. Lack of control over yield: theoretically, there is little control over milk yield. However, increased awareness of developments like embryo transplant, artificial insemination and properly managed animal husbandry practices, coupled with higher income to rural milk producers should automatically lead to improvement in milk yields.

1. Limited number of Mother Dairy and Safal outlets 2. Difficult to maintain competitive pricing 3. Vegetables and milk products are perishable

3. Logistics of procurement. 4. Problematic distribution: yes, all is not well with distribution. But then if ice creams can be sold virtually at every nook and corner, why can’t we sell other dairy products too? Moreover, it is only a matter of time Page | 41

before we see the emergence of a cold chain linking the producer to the refrigerator at the consumer’s home! 5. Competition: with so many newcomers entering this industry, competition is becoming tougher day by day. But then competition has to be faced as a ground reality. The market is large enough for many to carve out their niche.

Opportunitie s

1. Value addition: there is a phenomenal scope for innovations in product development, packaging and presentation. 2. Export potential: efforts to exploit export potential are already on. Amul is exporting to Bangladesh, sri lanka, Nigeria, and the middle east. Following the new GATT treaty, opportunities will increase tremendously for the export of agriproducts in general and dairy products in particular.

Threats

Milk vendors, the un-organized sector: today milk vendors are occupying the pride of place in the industry. Organized dissemination of information about the harm that they are doing to producers and consumers should see a steady decline in their importance

1.continuous demand of dairy products and other products by Mother Dairy 2.open more number of Mother Dairy outlets 3.market and the products 4. Increase its market share by expansion in untapped markets

1. Strong marketing muscle by competitors 2.unstable economic condition in India 3.other competitor brands

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4.2 CSR activities Corporate social responsibility (CSR) has been defined as the “commitment of business to contribute to sustainable economic development working with employees, their families, the local community, and society at large to improve their quality of life, in ways that are both good for business and good for development.”

4.2.1 Amul India To meet with the CSR it is expected that a business in its entire procurementproduction-processing-marketing chain should focus on human development involving the producer, the worker, the supplier, the consumer, the civil society, and the environment. Indeed, a very tough task. Most businesses would certainly flounder in not being able to achieve at least one or many of those expectations. But Amul has shown the way.

Amul Relief Trust A devastating earthquake (Richter scale – 7.9) hit Gujarat on 26th January 2001. The epicentre of the quake was located in Kutch district. It caused death of thousands of people, tens of thousands were injured, hundreds of thousands were rendered homeless and damage of billions of Rupees was done. GCMMF formed a specific organization named "Amul Relief Trust" (ART) under the Chairmanship of Dr. V. Kurien in 2001 with a donation of Rs. 50 Millions for reconstruction of the school buildings damaged in the 2001 earthquake in the Kutch area. The Trust reconstructed 6 schools damaged by the above earthquake at a cost of Rs. 41.1 millions in Kutch area. Four of these schools started re-functioning from the last two academic sessions and the other two schools from the current session.

CSR-sensitive business philosophy the first step towards discharging the CSR is the business philosophy of the GCMMF. It is two-fold: one, to serve the interests of milk producers and second, to provide quality products to consumers as value for money. Evolution of an organisational system has ensured that the corporate social responsibility towards the primary milk producers, village and the ecological balance is fulfilled. The milk producers are paid Page | 43

for their milk in accordance with market forces and realisation of value for their produce. Invariably the price paid to the member-producers in Gujarat is higher by 15 per cent than the national average. CSR-orientation to distributors & retailers the GCMMF has identified the distributors and retailers are its important link in its vendor supply chain. Through surveys the GCMMF found that 90% of the distributors do not get any opportunity of exposure to latest management practices. The GCMMF realized that it was a corporate social responsibility to strengthen the core business processes of its distributors so as to keep them in mainstream business and compete with those with formal training in management. The GCMMF has developed and trained all its distributors through value-mission-strategy workshops, competence building, Amul yatra, Amul quality circle meetings, computerisation, and electronic commerce activities. Competency building module of the GCMMF is meant to infuse professional selling skills by making the distributors and their salesmen aware of latest sales management tools and techniques; enhance their knowledge of products; positioning and segmentation strategies for various products. Under Amul yatra the distributors and their salesmen are taken on a visit to Anand. During this visit they are shown dairy plants, their upkeep, international standards of hygiene and quality; the practices adopted for clean milk production, and above all the cooperative philosophy. Through one to one talk with the farmers, the distributors and salesmen realise Amul is a large business of small farmers. The visit leaves an everlasting impression on their minds that by selling Amul products, they are discharging a social responsibility towards a large number of poor farmers whose livelihood depends upon their skill and integrity. They feel proud that they are participants in development of rural society and thus in nation building. Earnings of GCMMF nurturing its primary - the milk producers - is the first mission of the GCMMF. Discharge of this responsibility is reflected in the manner in which the GCMMF conducts its business and shares its earnings. The milk from the village cooperatives is purchased at an interim price. So as to maximize the earnings of the milk producers the GCMMF changes the product profile during the fiscal and directs its sales and marketing activities towards those products that would bring in maximum returns. True! Every business organization follows the same principle. But the GCMMF follows it with the central interest of the producers. During the fiscal, as the GCMMF finds that from its earnings it is possible to pay more to the producers for milk, the final price is declared higher than the interim price being paid. Before the GCMMF closes its financial s the co-operatives are paid ’price difference’, the amount between the interim price and the final price. Thus profit of the GCMMF is very low. The net profit (PADT) of the GCMMF during 2003-04 was rs 7.31 crore against a turnover of rs 2,947 crore, a meagre 0.25%. Further out of the net profit of rs Page | 44

7.31 crore, rs 4 crore was given as share dividend to the co-operatives. To fulfill its corporate social responsibility towards its milk producers and co-operatives the GCMMF works on razor thin profits and retention of funds. CSR-oriented to staff the GCMMF hires and trains people to take advantage over its competitors. It has developed in-house modules for training and competence building to improve and upgrade of their knowledge; communication skills to understand the customer, be responsive to customer requirements, and communicate clearly for trouble shooting of problems. They are expected to be courteous, friendly, respectful, and considerate to the customer. To improve the credibility and trustworthiness of the managers it is important they perform consistently and accurately every time and at all times. The structure of salary and perquisites is altogether different. The first and foremost the staff must get satisfaction from the job they. They are recognized for their contribution (climate survey) CSR- Amul way Green Gujarat tree plantation campaign by milk producers of dairy cooperativesMilk producer of Gujarat dairy cooperatives- better known as Amul have been celebrating the nation's independence day in a novel manner by planting lakhs of saplings across Gujarat and have taken up an ambitious plan to save the environment by planting trees, making India green and thereby reducing the effects of global warming. The milk producers of Gujarat dairy cooperatives are conducting mass tree plantation drive every year on Independence Day for last eight years. In last five years (2007 to 2014) the milk producers have planted around 518.7 lakhs trees). The most striking feature of these entire programmes was that it has been initiated by milk producer of the dairy cooperatives. The unique fact about the programme was that the milk producer took up the oath to protect tree saplings till it survives and grows into tree. Over the years, due to intensive agriculture and dairying various natural resources are getting consumed at faster pace in Gujarat state of India. The state level apex body of dairy farmers in Gujarat gave a serious thought in this direction and discovered a novel idea for giving back to nature. The idea was "one member one tree" plantation on our 60th independence day - 15th august 2007.to put this idea in to the practice a design team constituting of representatives of member unions were formed. The team accepted the idea by heart and immediately decided to spread it among farmer of village dairy cooperative societies. Then the idea was communicated to farmer and they all welcomed it and enthusiastically agreed to implement the idea. For smooth implementation of the idea, the design team chalked out the road map for various activities. Execution teams were formed at district union level to give final shape and put the plan in action. Village level coordinators were identified and they were trained to streamline activity of tree plantation. Various awareness materials Page | 45

were prepared. Through various communication media farmer were made aware of benefits of tree plantation and tree plantation activity schedule The entire plantation activity was coordinated at all the three tiers of Anand pattern at village, district and state level dairy cooperatives. On 15th august, 2007, after the flag hoisting ceremony, each member took an oath to plant saplings and ensure that they grew in to trees. Then individually they planted sapling on their own at their identified locations like their farm, near their home, on farm bunds, etc. They have taken necessary care to ensure that this sapling survives and they also reported regarding the survival to village level coordinator and district milk unions after five months. In this way, 18.9 lakh trees were planted on 15th august 2007. This was just the beginning. Henceforth, the village dairy cooperative societies of Gujarat as a mark of respect for our nation decided to conduct such event on every Independence Day and accepted 15th august (Independence Day) as a "green revolution day by afforestation to protect mother earth from pollution, climate change and global warming". But all this required immaculate planning and execution. An action plan of tree plantation programme was drawn up months back in advance. After the identification of the chief coordinator for each district milk union, the organization of a task force for the programme was put in place. Roles and responsibilities were assigned to each member and area of operation allocated. After preparing the overall action plan, each union issued a circular to the dairy cooperative societies regarding the programme and arranged meetings with the societies covered. At the village level, coordinators were identified in respect of the villages to be covered and the number of saplings required. Along with logistical arrangements direct was established with different agencies for receipt of saplings. Pointwise methodology for implementation of tree plantation programme on such a mass scale is as following.

First tree plantation programme (15th august, 2007) was carried out on "one member, one tree" basis. Second tree plantation programme (15th august, 2008) in which around 52.74 lakhs tree were planted was conducted on "one member three tree" basis. In year 2009 and in year 2010, in mass tree plantation programme around 84.24 and 83.5 lakhs tree saplings were planted respectively. The programme was conducted on "one member, five tree" basis. Further, this year 2011 around 72.6 lakhs trees were planted, the programme was carried out as per the same process and procedures followed in last year.

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There from, in last eight years, milk producers of GCMMF planted around 518.7 lakhs tree saplings in 28 districts of Gujarat. By doing so, milk producers of Gujarat dairy cooperatives have shown their concern, awareness and commitment for betterment of environment. Year wise details of tree plantation and survival of tree saplings planted is as under. Year of tree plantation 2007

No. Of trees (in lakhs) 18.9

No. Of trees survived (in lakhs) 11

Survival percentage 58

2008

52.7

26

49

2009

84.2

38

45

2010

83.5

39

47

2011

72.6

34

47

2012

57.4

26

45

2013

72.0

34

47

2014

77.7

35

45

Total

518.7

243

47

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4.2.2 Mother Dairy Overview The very genesis of the organization was a result of the initiative to provide value to farmers and safe milk to consumers. Corporate Social Responsibility (CSR) is thus an integral part of the business model we operate on. Multitude of social development and other initiatives have been nurtured by Mother Dairy from its earliest days. At Mother Dairy, their commitment to ethical conduct and social responsibility is core to their way of doing business, and is strongly aligned with vision to create and increase value for our Indian farmers and to provide affordable, safe, healthy and tasty products to consumers.

Community Their commitment to serve the farmers Mother Dairy sources significant part of its requirement of Liquid Milk from Dairy Cooperatives. Similarly Safal sources its requirement of Fruits and Vegetables from farmers/growers association and Dhara helps the Oilseeds Grower Cooperatives by sourcing the production of the wide range of Dhara edible oils from them. This ensures that the farmers get the appropriate prices for their yield and quality. Mother Dairy also works towards improving the standards of the farmers by educating them about better farming techniques, hygienic practices and modern methods of dairy farming. This initiative by Mother Dairy is directed towards making the farmers independent and financially self-sufficient.

Environment Their commitment to our environment Though it may be just a daily affair at Mother Dairy, the Milk Giant, selling almost 11 lacs of loose pasteurized and homogenized milk every day through an extensive incomparable network of almost 750 booths, 25 mini milk shops, 1,400 Insulated container outlets and 800 container on wheels, covering the remotest corners of Delhi, where even a two wheeler can’t and yet contributing to a larger cause of Green environment. By doing so, it’s not only providing nutritious unadulterated, hygienic milk to every section of society but also modestly helping the society in saving 1,700 tons of plastic every year from getting into the environment. To commemorate the Environment Day, Mother Dairy attributed this noble cause to its Bulk Vended Milk Consumers and celebrated their role as “Mascots of Environment Friendly Vended Milk” through a signature campaign. This event witnessed a massive gathering at Mother Dairy outlets followed with lacs of signatures of consumers who pledged for a better environment. Overwhelmed by the cause and the occasion, the company spokesperson said: “Every day when more than 6 lac consumers walk to the Mother Dairy outlet to purchase the Page | 48

bulk vended loose milk they contribute significantly to the environment by saving tons of plastic from getting into the society at large. On Environment day, we salute those consumers who have been with us for the last 38 years to contribute towards greener society for tomorrow.” Many organizations today contribute a part of their profits towards CSR, but at Mother Dairy the operation in itself is a CSR, allowing less plastic from getting into the society and servicing the consumer in the remotest corner of Delhi. Truly, Mother Dairy consumers leave a Green footprint everyday by reassuring their trust on bulk vended loose milk.

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Chapter Five Analysis of data Q1.

Out of the 54 respondents who have answered this question 49 are familiar with the products offered by Amul and Mother Dairy. This constitutes about 96% of the sample size.

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Q2. Have you tried the products?

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Respondents answering this question, overall more than 50% of them have tried the generally available products offered by Amul like milk, butter, cheese, ice-creams, dahi. Mother Dairy products are overall tried by 50% of the people who answered but it is still less than Amul.

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Q3. How do you rate the products in of taste?

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The products offered by Amul are voted as excellent overall in of taste, Mother Dairy products are found to be good. These products are rated by the respondents Page | 58

varying from the range excellent to average, however no respondent has found any of the products to be poor in taste. Q4. Availability of the products with retailers?

Amul products availability with the retailers is rated more than the availability of Mother Dairy. 98.1% of the respondents say that Amul products are easily available with the retailers, while only 42.6% people feel that mother dairy products are easily available.

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Q5. How do you rate the products for their value of money?

According to the respondents, Amul provides excellent products for their value of money and Mother Dairy provides good products for its value.

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Q6. Pricing of the products according to you.

People feel both the companies, Amul and Mother Dairy sell their products at a reasonable price with 79.6% and 63% respectively. 16.7% people have found Amul products to be priced high and 33.3% that is one-third of the people find Mother Dairy products high priced. 3.7% people find the products priced low in both.

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Q7. How do you find the promotion through TV ments?

Amul ments are found very effective by 55.6% of the respondents and 44.4% found them to be effective. Mother Dairy products have received reviews in all three where most people find the ments to be effective, more people have found them not effective than being very effective.

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Q8. How do you rate the packaging in of safety and attractiveness?

Majority of the respondents feel that the packaging of products offered by Amul and Mother Dairy are excellent and good respectively. Next they feel Amul products are attractively packed and are safe from any damage etc. Mother Dairy products have received an equal vote for excellent as well as average packaging of their products.

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Q9. How do you rate the brand as a whole?

More than 50% responses are in favour of Amul brand being excellent as a whole, whereas 46.3% feel that the brand is good. Mother Dairy brand has been voted as a good brand overall, then average, and then excellent. Both brands have not received any vote as poor in of the brand as a whole.

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Q10. Which brand do you prefer to purchase?

54 responses that is 100% of the people who answered prefer to purchase Amul products over Mother Dairy.

Hypothesis testing The hypothesis for the research that is “Amul is preferred over Mother Dairy by the consumers of Mumbai” has proven to be correct with reference to the above analysis of the questionnaire given out to people. Since most of the responses have been in favour of Amul whether in of the product taste, variety, attractiveness in packaging etc. the hypothesis turns out to be true.

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Chapter Six 6.1 Conclusion Taking the hypothesis; that Amul is preferred over Mother Dairy by the consumers into consideration, we know that 54 out of 54 respondents prefer to purchase Amul products over Mother Dairy products given a choice. Amul being one of the oldest dairy cooperative in India, it has created a place for itself in the market and a very high benchmark for other companies in the dairy industry. The reason maybe Amul’s reach to the consumers, be it easy availability with the retailers, or its quirky ideas with the posters depicting recent ongoing in the country. Mother Dairy is probably lacking behind in the reach to the consumers, because 31 of the respondents have said that the products offered by Mother Dairy are not easily available with all the retailers. The responding consumers have felt that Amul products are excellent for their value of money, while Mother Dairy provides good products for its price. Both the companies Amul and Mother Dairy have kept their pricing very reasonable for any category of consumer to purchase, the respondents have as well found the same in case of price for the products. The TV ments of Amul are directing towards the feeling of being together as a family and Indianness, through the tag line ‘the taste of India’ which itself indicates that Amul products are generally chosen by the people. Hence we come to know through the comparative study of both companies, Amul is generally liked as well as preferred by the consumers.

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6.2 Recommendations and suggestions AmulTo improve further Amul can try out the following ideas 1. Amul can venture out on new products like Toned milk, Baby food products, 2. There are certain product like Amul basundi, gulab jamun, and chocolates etc. which are not as popular as Amul ice cream. Amul must try to understand the cause of this through thorough market research and work on improving these products 3. Though Amul’s hoardings are a huge success, it can penetrate even better in the rural areas by advertising through the media viz cable channels and newspapers. Sponsoring shows in TV, sports events can be of great help. 4. Amul has a relatively good distribution network, but still company is not able to fulfill the demand of outlet in the peak season when demand is very high. Here company should consider on the supply of product in the peak season.

Mother DairyTo improve further Mother Dairy can try out the following ideas 1. Though Mother Dairy follows break bulk in its distribution system, it needs to increase its distribution network to more retailers to increase its reach to the consumers. 2. Penetration in the rural areas of India. 3. Different promotion strategies through ments or TV or event sponsorships may increase its popularity among the consumers.

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Annexure Blank questionnaire: Consumer’s perspective on Amul and Mother Dairy Hi! This questionnaire is for a research project and your perspective on these brands is required. This will take up a few minutes of your time, thank you! * required

Are you familiar with the different products offered by Amul and Mother Dairy? o yes no

o

Have you tried the products? * Yes

No

Amul- milk Butter Cheese Ice-creams Masti dahi Mother Dairymilk Butter Cheese Ice-creams Dahi How do you rate the products in of taste? * Excellent

Good

Average

Poor

Amul- milk Page | 68

Excellent

Good

Average

Poor

Butter Cheese Ice-creams Dahi Mother Dairymilk Butter Cheese Ice-creams Dahi

Availability of the products with retailers? * Whether easily available or not. Yes

No

Amul Mother Dairy How do you rate the products for their value of money? * Excellent

Good

Average

Poor

Amul Mother Dairy Pricing of the products according to you. * High

Reasonable

Low

Amul Mother Dairy How do you find the promotion through TV ments? * Very effective

Effective

Not effective

Amul Mother Dairy Page | 69

How do you rate the packaging in of safety and attractiveness? * Excellent

Good

Average

Poor

Average

Poor

Amul Mother Dairy How do you rate the brand as a whole? * Excellent

Good

Amul Mother Dairy Which brand do you prefer to purchase? * o Amul o

Mother Dairy

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Bibliography Marketing Management 14th edition- Philip Kotler Marketing Management: millennium edition- Philip Kotler Official sites- National Dairy Development Board Amul India Mother Dairy Wikipedia

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