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A Project Report ‘’A Study on Comparative Marketing Strategies of milk and milk products at GCMMF LTD’’ Undertaken at

Project report submitted to

Institute of Public Enterprise, Hyderabad In Partial fulfilment of the PGDM(Retail marketing) curriculum For Academic Year 2016-2018 By Ye rrabapani Karshak Reddy (1602007) Under the supervision of V Anji Raju, Associate Professor, Marketing

‘’A Study on Comparati ve Marketing Strategies of milk and milk products at GCMMF LTD’’

Marketing Marketing is the activity, set of institutions, processes for creating, communicating, delivering exchanging offerings that have value for customers, clients, partners and society at large.

From a societal point of view, marketing is the link between a society’s material requirements and its economic pattern of response. Marketing satisfies these needs and wants through exchange process and building long term relationships. Marketing can be looked at as an organizational function and a set of process for creating delivering and communicating value to customers, and managing customer relationship in ways that also benefit the organization and its shareholders. Marketing is the science of choosing target markets through market analysis and market segmentation, as well as understanding consumer buying behaviour and providing superior customer value.

There are five competing concepts under which organizations can choose to operate their business: the production concept, the product concept, the selling concept, the marketing concept, and the holistic marketing concept. The four components of holistic marketing are relationship marketing, internal marketing, integrated marketing, and socially responsive marketing. The set of engagements necessary for successful marketing management includes capturing marketing insights, connecting with customers, building strong brands, shaping the market offerings, delivering and communicating value, creating long-term growth, and developing marketing strategies and plans. The scope of marketing can be understood in terms of functions that an entrepreneur has to perform. This includes the following a. Functions of exchange – which include buying, selling, assembling b. Functions of physical supply – includes transportation, storage, where house c. Functions of facilitation – product planning and development, marketing research, standardisation, grading, packaging, branding, sales promotion, financing. Importance of marketing in small business Since marketing is consumer orientated, it has a positive impact on business firms. It enables the entrepreneurs to improve the quality of goods and services. Marketing helps in improving the standard of living of the people by offering a wide variety of goods and services with freedom of choice, and by treating the customer as the most important person. Marketing generates employment in both production and distribution areas. Since, the business firm generates revenue and enhances profits by carrying out marketing functions, it will engage in exploiting more and more economic resources of the country to earn more profits. Large scale businesses can have its own formal marketing networks, media campaigns and sales force, with a small unit may have to depend totally on personal efforts and 2016-2018

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‘’A Study on Comparati ve Marketing Strategies of milk and milk products at GCMMF LTD’’

resources, making it informal and flexible. Marketing makes or breaks small enterprise. An enterprise grows, stagnates or perishes with the successes or failures, as the case may be, of marketing, is appropriate example of the successes of the small scale enterprises.

Market segmentation Market consists of large number of individual customers to differ in terms of their needs, preferences and buying capacity. Therefore it becomes necessary to divide the total market into different segments or homogeneous customer groups. Such division is called market segmentation. They may have uniformity in employment patterns, educational qualifications, economic status, preferences, etc. Market segmentation enables the entrepreneur to match his marketing efforts to the requirements of the target market. Instead of wasting his efforts in trying to sell to all types of customers, a small scale unit can focus its efforts on the segment most appropriate to its market. Market can be segmented on the basis of the following variables1. Geographic segmentation - the characteristics of customers often differs state, region, cities or neighbourhoods the entrepreneur can decide to operate to and of a few or all the geographic areas, but pay attention to differences 2. Demographic segmentation – variables such as age, sex, family size, income, occupation, education, race, religion and nationality widely used for market segmentation. 3. Psychological variables – personality, lifestyle, social class, etc. can also be used for market segmentation. For ex products like pens, cosmetics, watches briefcases are designed differently for common man and status seekers. 4. Behavioural segmentation: buyers are divided into several groups of buyers on the basis of their knowledge, attitude and use of response to a product.

Marketing Mix: A brief description of four elements of marketing mix is as follows:1. Product: The first element of marketing mix is product. A product is anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or a need. Products include physical objects, services, events, persons, places, ideas or mixes of these. This element involves decision concerning product line, quality, design, brand name, label, after sale service product range etc., an appropriate combination of features and benefits by the small firm will provide the product with USP (unique selling proposition). This will enhance the customer loyalty towards the product. Products and services are broadly divided into cons umer products and industrial products. Consumer products are bought for final

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‘’A Study on Comparati ve Marketing Strategies of milk and milk products at GCMMF LTD’’

consumption whereas industrial products are bought by individuals and organizations for further processing or for use in conducting business. 2. Price. The second element is the price, which affects the volume of sales. It is one of the most difficult tasks of the marketing manager to fix the right price. The variables that significantly influence the price of a product are: demand of the product, cost, competition and government regulation. It includes determination of unit price of the product., pricing policies and strategies, discounts and level of margins, credit policy, terms of delivery, payment etc. pricing decisions have direct influence on the sales volume and profits of the firm. Price, therefore, is an important element of the marketing mix. Right price can be determined through pricing research and by adopting test marketing techniques. Small firms should think of pricing as a method whereby prices are set with regard to costs, profit targets, competition and the perceived value of products. Because of their simplicity, cost-plus-pricing are attractive to small businesses, though this is not the only mode of pricing utilized by small firms. For example- the profit margin in the cost- plus approach may well be fixed after examine both the nature of the market and the competitor activity within it. It is a mistake for all small firms to rely wholly on cost-plus, but very often small firms do that to the detriment of pro fits and market share. 3. Promotion. Promotion is the important part of marketing mix of a business enterprise. The purpose of promotion is to inform, persuade and influence the prospective customers. Advertising, salesmanship, sales promotion and publicity are often used to inform the people about the availability of products and create among them the desire to buy the products. No business enterprise can market its products unless it takes promotional activities effectively. The prospective customers have to be informed about the product, its features, utility and availability. The need for promotional activities has increased because of stiff competition, widening of market, rapid changes in the technology and tastes of customers. 4. Place. This is another key marketing mix tool, which stands for the various activities the company undertakes to make the product available to target customers. Place mix or delivery mix is the physical distribution of products at the right time and at the right place. In every industry, catching the eye of the c ustomer and making it easy for them to buy it is the main aim or good distribution or ‘place strategy’. Retailers pay a premium from the right location. it is also helpful for the company to decide its target customers and carryon its business operations.

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‘’A Study on Comparati ve Marketing Strategies of milk and milk products at GCMMF LTD’’

Four elements of brand image When brands look to holistically improve customers’ brand experiences, it can be helpful to consider four criteria: Impression, Interaction, Responsiveness and Resilience.

1. Impression- ‘I like what this brand has to offer me’ It’s quite simple – to attract a customer they have to like what a brand has to offer – in other words, its proposition. The effectiveness of a brand’s proposition is based on its relevance to a customer – whether it firstly targets the right customer and then meets a need (or creates one first, in order to meet it). Another key element of marketing the right impression is differentiation. Standing out from peer brands is important but standing out across categories can ensure share of mind in a world where consumers are constantly assaulted with competing marketing messages. But probably the most critical element is that the proposition must be based on organizational truths. If it doesn’t link to a core competency, and operational advantage, to business strategy (or even all three), it has the potential to leave the brand exposed. 2. Interaction- ‘This brand does what it says’ Creating a brand is all well and good, but how often do customer find that it isn’t delivering on what it promised? Optimizing delivery is contingent, first and for most, on consistency. If a brand doesn’t consistently reinforce its contingent, first and foremost, on consistency. If a brand doesn’t consistently reinforce its message through every possible touch poi nt, it’s missing an opportunity to optimize the opportunities created by the impression. Several organizations today are aligning their ‘experience’ across bricks -and-mortar operations as well as on line channels in an effort to do this. The other key component of delivery is access- is the brand available to people when and where they want it with an effective channel, distribution and online strategy? And finally there’s the delivery – if plenty kitchen towels didn’t actually absorb 25% more as compared with store label towels, it would simply lose all credibility. 3. Responsiveness- ‘This brand responds to my needs’ If impression and interaction seem like standard brand fare, this element is where brands truly start to make a difference. ‘Personalization’ (not to be mistake for bespoke) is an essential requirement to ensuring your brand doesn’t become commoditized. At the basic end, this can mean variants of shampoo that address ‘issue’ such as dandruff , frizz or hair – loss. At a more sophisticated end, it means a digital strategy that adapts itself to users to deliver a custom experience, the more and more and more y ou use it.

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‘’A Study on Comparati ve Marketing Strategies of milk and milk products at GCMMF LTD’’

Responsiveness also includes the concept of approachability. This is about more than just general access-it about a customer felling that a brand like direct can be approached easily and will respond appropriately. Perhaps most important however, is the concept of adaptability- does the brand pro-actively look at its audiences and practice incremental innovation that addresses needs or adapts to emerging lifestyles? For instance, when British airways intercede electronic boarding passes, it was based on an understanding of how their customers’ lifestyle were changing. 4. Resilience- ‘This brand cares about our future’ One may see this element as a nice-to-have, but it’s the pillar that some of the world’s most powerful brands build their businesses around. A key element of resilience is imparting a reputation of ‘responsibility’ this has far outgrown traditional expectations of being ‘sustainable’-it now manifests itself as organizational integrity. No one expects a brand to be infallible, which is may be why apple get away with suicides at manufacturing plants in china or how Nike managed to ultimately come out on the right side of a sweatshop scandal it’s about perception more than anything else –but it does mean brand now have to subject their supply chain to unprecedented scrutiny – so that your burger don’t end up with horsemint’ or that your dishwashing liquid doesn’t suddenly earn itself a reputation for wiping out entire ecosystem Brand also need to be future-proof—this now transcends categories like bank that are meant to safe gaur your assets and provide much needed credit to business over extended periods of time. Today, brand in almost any category that aren’t perceived as having strong business behind them simply lack credibility, which can undermine the other elements of the brand experience. The ultimate component of this categories however, is category influence. Brand that think beyond the confines of categories, market and capabilities – apple, google, amazon, Netflix- are usually the ones that ones that shatter conventions, transform expectations and change the way customer live their lives.

BEHAVIOUR: PHILLIP KOTLER defines four patterns of behaviour 1. Hard-core loyal – who buy the brand all the time 2. Soft-core loyals - who buy two or three brands. 3.

Shifting loyalty – moving from one brand to another.

4.

Switchers

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with no loyalty (possible dual pro, constantly looking For bargains or vanity buyers, looking for something Different.)

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‘’A Study on Comparati ve Marketing Strategies of milk and milk products at GCMMF LTD’’

EXECUTIVE SUMMARY Indian dairy industry is very diverse. Dairy farming is an important livelihood opportunity across India. Milk and dairy products play an important role in a healthy balance diet in Indian food .Andhra Pradesh is the second largest milk producer in India and has a market share of 9% only next to Uttar Pradesh which contributes 18%. The brand purpose of this project is: 

  

From Retailers aspect- The objective of the study is to know the prefere nce of Retailers towards the launching of a new product for amul to have an edge over other brands. To observe the marketing mix of amul dairy products in Hyderabad. To understand the challenges faced in the distribution of the products. To know the demand and perception of Amul brand in Hyderabad.

Purpose method was used for selecting the respondents. A total of 50 respondents were selected for the survey across the city of Hyderabad. All the retailers were used as a sample for market research. The survey was conducted through a structured questionnaire but as and when needed we conducted unstructured interviews and discussion with some dealers and with concerned persons; and based upon their answers and responses and the conclusion, the data has been collected, analyzed and interpreted. Customers’ perception, preference, demand, comparative sales and satisfaction level has been studied. The major findings were –Around 80% of the retailers prefer a higher margin to sell the product. About 72% of the customers are brand switchers and are ready to shift their brand if they are being provided with what they require. Hyderabad market has cut throat competition in the dairy market segment. Timely delivery, easy availability and margin in the milk are the major factors that are being considered by the retailers. Amul is being considered as a trusted brand by the customers and are ready to switch from their current brand if their preferences are being considered.

OVERVIEW OF THE STUDY The project work entitled “A study on comparative marketing strategies of milk and milk products at GCMMF LTD” with special reference to Gujarat co-operative milk marketing federation (GCMMF) ,is mainly conducted to segment, target and position the product. This study mainly focused on 4p’s(marketing mix) and marketing challenges. This study was carried out in the Hyderabad city. The purpose of the study is focused on launching the butter milk in the market and improving the retailing of the butter milk curd and milk products in Hyderabad. This study considered 2016-2018

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the feedbacks given by the retailers to evaluate the problems and improving the quality of supply chain. Milk and curd comes under necessities; so availability of product matters a lot. Considering this fact amul focused more on the supply chain. Based on the findings of this study, the company can expect its future marketing plan and marketing strategy. Dairy activities have traditionally been integral to India’s rural economy .the country is the world’s largest producer of dairy products and also their largest consumer. In India after white revolution many new private milk companies had opened and many milk cooperatives were also formed due to this the dairy products market became a competitive fleld and thus dairy sector tried to increase its market share and started introducing new technique for producing new dairy products range such as curd, buttermilk, lassie, cheese, ghee, butter etc. Curd is considered to be an essential part of a meal of the Indian food culture. Has now a days most of the people in the family are working members the need for the purchase of curd has arose. This has increased the sales of packed curd too along with milk.

Hyderabad being a cosmopolitan city and with many competitors in the field of dairy products, there is a rise in the brand of milk. Amul being one of the best brands in dairy products and it has now entered into the sale of milk it needs to withstand the competition by being able to give its customers what they required so that it could reta in its present customers and also grab the attention of other customers. Food still accounts for highest share of monthly household expenditure in india, number of urban Indian households growing by more than three times in the next 50 years, we anticipate sharp rise in demand for branded, packaged, nutritious food products which are easily available and offer value – for money as well as convenience. Affordability and easy availability, along with food, milk and dairy products account for the highest share of expenditure (after cereals) for an average Indian household.

NEED OF THE STUDY The managers of consumer market must react in a different way to change the markets, develop products to meet these changes and market them in exclusively different way to target and sophisticate customers. They can face many distinctive marketing situations in the consumer market. For marketing effectiveness, the product should always be regarded as variable and should be viewed from the perspective of customer, customers satisfaction, need satisfaction should be the center of attention . further customer satisfaction should be dominant in all corporate decision making. So before taking any major decision it is very important to know customer’s preferences about the factors they consider to be available in a product of their choice . it can help in taking major decisions. Dairy sector is one of the fastest growing sectors in India as it is still having 85% of unorganized sector. Competition is growing day by day as many MNC’s are focusing on the Indian market. The dairy industry is dominated by the co-operative sector. Marketing is the process through which the goods of the manufacture goes to its final consumer. It is the 2016-2018

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‘’A Study on Comparati ve Marketing Strategies of milk and milk products at GCMMF LTD’’

process through which the selling of the product happens through which revenue generates. Its importance can be seen from the fact that according to Philip kotler in the united states channel member collectively have earned margins that accounts for 30%to 50% of the ultimate selling price. In contrast advertising typically accounts for less than 5% to 7% of final price. It ranges in a similar manner for south Asia as well. One of the chief roles of the marketing channel members is to convert potential buyer into profitable buyer. Marketing channels must not serve market but also make markets. OBJECTIVE OF THE STUDY Hyderabad is having a wide range of milk products available in the market. Hyderabad is the major consumption area of milk products in the state of Telangana. There are many dairy companies national as well as local who competes with each other to capture the market share. This study was conducted in busy places all over Hyderabad. This study has four aspects that are 1) 2) 3) 4)

Product Price Place( distribution) Promotion

It has also focused on STP (segmentation, targeting positioning) model. 





Segmentation: segmentation has been done considering the demographics, behaviour and benefit point of view. Segmentation is a practice that seeks out pieces of the total market that contain customers with identifiable characteristics, as defined by income, age, personal interests, ethnic background, special needs and so forth. Targeting: Based on the segmentation, targeting has been done with special strategies and offering. Amul applied market specialization and full market coverage strategies in Hyderabad market. Market specialization is dealing with one specific market only. Amul tried to meet many needs of a particular customer groups. Positioning: Placing the product in the minds of consumers in positioning. Success of products starts from here. Amul is able to come up with unique selling proposition for the product.

METHODOLOGY Sampling: Cluster sampling technique has been used to collect the data. Retailers who already exists and new retailers who had joined to sale amul products Framework of the study: A Structured questionnaire was used to carry out this study that was conducted on retailers. At times even the data was collected through an unstructured interview and discussion, the data has been collected, analyzed and interpreted. 2016-2018

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Source of the study; Primary data was collected through questionnaire and by interviewing the retailers at time the primary data was also collected through un-structured interviews and discussions. Data was also collected by visiting the site and interviewing or discussing the concerned matter with the authorized person. Secondary data is collected through the various websites of the government which are related to milk, milk procurement and milk products and also through the webs ites of various milk product companies situated in telangana, reports that are annually published by the department and research papers which are written earlier on the related topic. Significance of the study: Milk plays a major role in every individual’s life, there are many food items prepared out of milk. Curd is considered to be one of the import parts of an Indian meal. Consumers prefer various qualities of milk. This study will help us to know the importance of retailing in the milk industry. This study will help us capture the market towards amul brand of milk which would be according to the preferences of its customers so that it could win an edge over other brands of milk in the Hyderabad market. The finding, conclusion and the suggestion of the study will help GCMMF to make marketing plans in the future and by using these strategies company can increase its market share. Comparative sales, demand, satisfaction level, perception, preferences etc. are the tools used for the study.

LIMITATIONS OF THE STUDY The survey was conducted on a total sample size of 50. The survey was conducted on 30 existing Amul retailers and 20 competitors’ retailers which makes the total sample size as 50 So the study may not hold true and correct for the whole of the population of Hyderabad. The methodology that was used to analyze the responses may have some limitations and errors. Random sampling method was used to conduct they survey. The analysis was based on the responses of the interviewee. The conclusions and finding cannot be verified, as there is no method to verify whether the conclusions obtained and the findings that we obtain truly hold good. The same study is conducted on other sample size or on other set of respondents, then the analysis result can bee different and the conclusions and findings may vary from the original survey. LITERATURE REVIEW Consumer preferences are defined as the individual tastes, as measured by utility, of various bundles of goods. Customer perception is defined as the way the customer usually view or

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feel about certain services and products, it can also be related to customer satisfaction which is the expectation of the customer towards the products. Zeithaml(1988) pointed out that perceived value is very subjective and distinct and it is different from one customer to another. After consolidating four consumers’ expressions of value, she defined perceived value as a customer’s overall assessment of the utility of a product based on the perception of the same product-differently at different occasions. To illustrate; a customer may regard price as the most important criteria at the time of marking decision to purchase a product. Subsequently, when he/she is faced with any problem with regards to the product, he/she might consider that customer service is the most important factor that will affect his/her satisfaction/dissatisfaction. MONROE(1991) defined customer perceived value as the ratio between perceived benefits and perceived sacrifice. The perceived sacrifice was not solely referred to the purchase price but also includes all other possible costs that the customer might face in the purchasing process. Perception is the process by which people select, organize and interpret stimuli into a meaningful and coherent picture. Marketer’s managers first identify the important attributes such as price or quality that the targeted consumers want in a product and design signals to communicate these attributes. Consumers also associate quality and reliability with certain brand names. Companies watch their brand identity closely on a large part because a strong link has been established between perceived brand value and customer loyalty. Brown et al.(2000)reported that the need for educating young generation specially those who are in their adolescence are noticeably increasing, given their regular food eating habits and behavior, children who are in their teenage prefer food with respect to food nutritious as wee as three factors play a very important role, home environment, school and social gatherings. Aaker (2000) assess that brand awareness plays a vital role in consumer perception especially in their buying pattern is not defined. Branded items gives the feeling of familiarity especially in low involvement problems for example soaps and other day to day usage items, media and advertisement are effective tools for awareness. Nandagopal and chinnaiyan (2003) conclude that the mode of purchase also effecting buying patterns and so perception of consumer.

The most important factor which effect consumer perception/preference is: Accessibility Availability Quality Durability Regular supply of product Mode of payment

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Product quality has two forms 1. Accurate quality 2. Expected quality The actual quality contains the actual benefits achieved from the purchase of product the other hand perceived quality contain consumer expectations from product. Vanniaranjan and kubendran (2005) describe that consumer perception and usage of any product can be changed due to change in food eating habit. If income and urbanization increases among consumers then the percentage of income spent on consumption increases. The urban consumer mostly like branded products as compared to rural consumers. Kumar et al.(1987) examined those factors which effect buying decisions making of large number of respondents for different food products. Country, origin and brand of the product impact effectively and largely. Brand of the product is the most important factor since consumers are more attracted towards brand. Income, age and awareness are dependent factors. Sabesson(1992),stated that brand of processed food is chosen by its quality, taste of the product and price of the product. These are the major factors which affects the criteria of food brand selection.

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Industry Profile India is the highest milk producer in the entire globe. India is well known as the 'oyster' of the global dairy industry, with opportunities galore for the entrepreneurs globally. It might be dream for any nation n the world to capitalize on the largest a nd fastest growing milk and milk products' market. The dairy industry in India has been witnessing rapid growth with liberalization. As the economy provides good opportunities for MNCs and foreign investors to release the full potential of this industry. The main objective of the Indian dairy industry is to manage the nation resources in a manner to enhance milk production and upgrade milk processing using innovative technologies. The crossbred technology in the Indian dairy industry has further augmented with the viability of the dairy units by increasing the milk production per animal. Then subsequently milk production also increased at an exponential rate while the benefits of an increase in milk production also reached the consumers from relatively lower increase in the price of milk producers for the dairy industry in India however appeared to have weakened during the 90's,a decline in the real price of milk being noticed after the year 1992. And then slowly regained it is glory after 1992 to till now. In India dairying from very much earlier is regarded as an instrument for social and economic development. The country's milk supply comes from millions of small producers, who are dispersed throughout the rural areas. All these farmers maintain an average herd of one or two milch animals, comprising cows and/or buffaloes. Mostly ample labor and a small land base encourage farmers to practice dairying as an occupation subsidiary to agriculture . As income from crop production is seasonal instead dairying provides a stable which is a year round income and also an important economic incentive for the small farmer.

INTRODUCTION : Amul (Anand Milk Union Limited), formed in 1946, is a dairy cooperative movement in India. It is a brand name managed by an apex cooperative organization, Gujarat co-operative Mil Marketing Federation Ltd. (GCMMF), which today is jointly owned by some 2.6 million milk producers in Gujarat, India. AMUL is based in Anand, Gujarat and has been a sterling example of a co-operative organization’s success in the long term. It is one of the best examples of co-operative achievement in the developing company. Amul has spurred the White Revolution of India, which has made India the bigges t producer of milk and milk products in the world. It is also the world’s biggest vegetarian cheese brand. Amul is the largest food brand in India and world’s largest Pouched milk Brand with an annual turnover of US $ 1050 million (2006-07)

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Currently Amul has 2.6 million producer members with milk collection average of 10.16 million litres per day. The brand name Amul means “AMULYA”. This word derived from the Sanskrit word “AMULYA” which means “PRICELESS”. A quality control expert in Anand had suggested t he brand name “AMUL”. Amul Products have been in use in millions of homes since 1946. Amul butter, Amul Milk powder, Amul Ghee, Amul Spray, Amul Cheese, Amul Chocolates, Amul Shirkhand, Amul Ice cream, Nutramul, Amul Milk and Amulya have made Amul a leading food brand in India.

HISTORY :

The Amul Revolution was started as awareness among the farmers. It grew and matured into a protest movement that was channeled towards economic prosperity. The Kaira District Co-operative Milk Producers Union Limited (KDCMPUL) began pasteurizing milk for the Bombay Milk Scheme in June 1948. By the end of 1948, more than 400 farmers joined in more Village Society, and the quantity of milk handled by one Union increased from 250 to 5,000 litres a day. Meanwhile, Dr. Verghese Kurien, fed up being at the government creamery in Anand,Gujarat, which held to challenge, Volunteered to help Shri Tribhovandas Patel, the chairman of KDCMPUL, in setting up a processing plant.This marked the birth of AMUL in 1946. The Success of Amul was instrumental in launching the White Revolution that resulted in increased milk production of India. It is officially termed as Operation Flood by Amul. The break through technology of spray drying and processing buffalo milk, developed by Mr.H.M. Dalaya, was one of the key factors that contributed the Revolution. Over six decades ago the life of a farmer in Kaira was very much like that of farmers anywhere else in India. His income was derived almost entirely from seasonal crops. Many poor farmers faced starvation during off–seasons. Their income from milk buffaloes was undependable. The milk marketing system was controlled by contactors and middle men. As milk is perishable, farmers were compelled to sell their milk for whatever they were offered. Often they had to sell cream and ghee at a throw away price. They were in genera illiterate. But they could see that the system under which contractors could buy their produce at a lower price and arrange to sell it at huge profits was just not fair. This became more noticeable when the Government of Bombay started the Bombay Milk Scheme in 1945.Milk had to be transported 427 kilometers, from Anand to Bombay. After preliminary trails, the government of Bombay entered into an agree ment with Polsons Limited to supply milk from Anand to Bombay on a regular basis. The arrangement was highly satisfactory to all concerned except the farmers. The Government found it profitable; Polsons kept a good margin. Milk contractors took the biggest cut. No one had taken the trouble to fix the price of milk to be paid to the producers. Thus 2016-2018

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under the Bombay Milk Scheme the farmers of Kaira District were no better off ever before. They were still at the mercy of milk contractors. They had to sell their milk at a price the contractors fixed. The discontent of the farmers grew. They went in deputation to Sardar Patel, who had advocated farmer’s co-operatives as early as 1942. Sardar Patel reiterated his advice that they should market their milk through a co-operative society of their own. This co-operative should have its own pasteurization plant. His advice was that the farmers should demand permission to set up such a co-operative. If their demand was rejected, they should refuse to sell their milk to middlemen. The Trio’s (T.K.Patel,Kurien and Dalaya’s) success at the cooperative’s dairy soon spread to Anand’s neighborhood in Gujarat. Within a short span of,five unions in other district’s – Mehsana, Banaskantha, Baroda, Sabarkantha and Surat – were set up. To combine forces and expand the market while saving on advertising and avoid competing against each other, the GCMMF, an apex marketing body of these district cooperatives, was set up in 1973. The Kaira union , which had the brand name Amul with it since 1955, transferred to GCMMF. In 1999, it was awarded the “Best of all” Rajiv Gandhi National Quality Award. In June 2013, it was reported that the Kaira District Cooperative milk Producers Union Limited, better known as Amul Dairy, had signed a tripartite agreement to start a dairy plant in Waterloo village in upstate New York. The plant will initially manufacture paneer and ghee. Amul will use an existing dairy plant owned by New Jersey-based NRI Piyush Patel for manufacturing. The plant is strategically located, as it close to supply centres from where raw material is procured, and is near New Jersey, which has a large Indian population.

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GUJARAT COOPERATIVE MILK MARKETING FEDERATION (GCMMF) Gujarat Cooperative Milk Federation Ltd. (GCMMF), s India’s largest food product marketing organization with annual turnover (2013-14) US$ 3.0billion. Its daily work milk procurement is approx. 13.18 million lit per day from 17,025 village milk cooperative societies, 17 members unions covering 31 districts, and 3.23 million milk producer members. It is the apex organization of the Dairy Cooperatives of Gujarat, popularly known as ‘AMUL’, which aims to provide remunerative returns to the farmers and also serve the interest of consumers by provid ing quality products which are good value of money. Its success has not only been emulated in India but serves as a model for rest of the World. It success has nit marketing organization of ‘Amul’ and ‘Sagar’ branded products. It operates through 53 Sales & offices and has a dealer network of 10000 dealers and 10 lakh retailers, one of the largest such networks in India. Its product range comprises milk, milk powder, health beverages, ghee, whey butter, cheese, pizza cheese, Ice cream, paneer, chocolates, and traditional Indian sweets Etc.

GCMMF is India’s largest exporter of Dairy products. It has been accorded a “Trading House” status. Many of our products are available in USA, Gulf countries, Singapore, Philippines, Japan, China and Australia. GCMMF has received the APEDA Award from Government of India for Excellence in Dairy product Exports for the last 13 years. For the year 2009-10,GCMMF has been awarded “Golden Trophy” for its outstanding export performance and contribution in dairy products sector by APEDA. In 2013-14, GCMMF took giant strides in expanding its presence in International markets. Amul’s presence on Global Dairy Trade (GDT) platform in which only the top six dairy players of the world sell their products, has earned respect and recognition across the world. By selling milk powders & many on GDT, GCMMF could not only realize better prices as per market demand but it also firmly established Amul in the league of top dairy players in world trade.

For its consistent adherence to quality, customer focus and dependability, GCMMF has received numerous awards and accolades over the years. It received the Rajiv Gandhi National Quality Awards in 1999 in Best of All category. In 2002 GCMMF bagged India’s most respected Company Award instituted by Business World. In 2003, it was awarded The IMC Ramakrishna Bajaj National Quality Award – 2003 for adopting noteworthy quality management practices for logistics and procurement. GCMMF is the first and only Indian organization to win top most International dairy Federation Marketing Award for probiotic ice cream launch in 2007. For the innovations, GCMMF has received AIMA-RK Swamy High performance brand award 2013 and CNN- IBN Innovating for better tomorrow award in 2014. For the tree plantation activit y GCMMF has received seven consecutive Good Green Governance award from Srishti during the year 20107 to 2013. The Amul brand is not only a product, but also a movement. It is one way, the representation of the economic freedom of farmers. It has given farmers the courage to dream which we can hope to live.

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GCMMF Today: GCMMF is India’s largest food products marketing organization. GCMMF markets and manages the Amul brand. From mid- 1990’s Amul has entered areas not related directly to its core of the business Its entry into Ice Cream was regarded as successful due to the large market share it if was able to capture within a short period of time – primarily due to the price differential and the brand name. It also entered the Pizza business, where the base and the recipes were made available to restaurant owners who could price it as low as Rs. 30/- per pizza when the other players were charging upwards of 100 rupees In September 2007, Amul emerged as the leading Asian brand according to a survey but the name Synovate to find out Asia’s top 1000 brands.

Collection of Milk: Every day Amul collects 4,47,000 litres of milk from 2.12 million farmers (many illiterate), converts the milk into branded, packaged products, and delivers goods worth Rs.6 crore i.e.; (Rs.6o million) to over 5,00,000 retail outlets across the country. Its supply chain is easily one of the most complicated in the world. How do managers at Amul prevent the milk form there souring? Walk into much Amul or Gujarat Cooperative Milk Marketing Federation (GCMMF) office, and you may or may not see a photograph of Mahatma Gandhi. But you will certainly see one particular photograph It shows a long line of Gujarati women waiting patiently for a union truck to come and collect the milk they gave brought in shinning brass matkas.

Organization Structure: It all started in December 1946 with a group of farmers keen to free themselves from intermediaries, gain access to markets and there by ensure maximum in returns of their efforts. Based in the village of Anand, the Kaira District Milk Cooperative Union (better known as Amul) expanded exponentially. It joined hands with other milk cooperatives, and the Gujarat network in now covers 3.12 million farmers, 10,411 village level milk collection centers and fourteen as such district level plants (unions) under the overall supervision of GCMMF. There are similar federations in other states. Right from the beginning, there was recognition that his initiative would directly benefit and transform small farmers and contribute to the edge development of society. Markets then and even today, are primitive and poor in infrastructure. Amul and GCMMF acknowledged that development and growth could not be left to market if forces and that proactive intervention were required. Two key requirements were identified. To implement their vision while retaining their focus on farmers, a hierarchical network of cooperatives was developed, this today forms the robust supply chain behind GCMMF’s endeavors. The vast and complex supply chain stretches from small suppliers to large 2016-2018

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fragmented markets. Management of this network is made more complex by the fact that GCMMF is directly responsible only for a small part of the chain, with a number of third party players (distributors, retailers and logistics support providers) playing large roles. Managing this supply chain efficiently is critical as GSMMF’s competitive position is driven by low consumer prices supported by a low cost system. Today customers can order a variety of products through the Internet and be assured of delivery with payment upon receipt. Another e- initiative underway is to provide farmers access to information relating to markets, technology and best practices in the dairy industry through net enabled kiosks in the villages.

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Products

AMUL TAAZA MILK Pasteurised toned milk It is available in 500ml, 1000ml, 200ml, and 5Ltr

AMUL GOLD MILK Pasteurised double toned milk It is available in 500ml, 1000ml, 200ml, and 5Ltr 2016-2018

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AMUL SLIM N TRIM Skimmed milk Available in poly pack of 6L, 5L, 1L, 500ml, 250ml

AMIUL MASTI DAHI Curd made from pasteurized Toned milk Available in poly pack of 200gm, 400gm, 1 kg Pp cup 200gm, 400gm, 100gm

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AMUL BUTTER MILK Pasteurized butter milk Available in poly pack of 500ml

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Organizational structure

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Swot Analysis

Strengths 1. 2. 3. 4. 5. 6. 7. 8. 9.

Strong network of over 3 million mik producers. World’s largest manufacturer of pouched milk. India’s largest food brand, trusted for its quality. Many types of mik made products such as ice cream, ghee, butter, paneer, dahi etc... Products available at affordable prices. Market leader in butter segment. Successful advertising and marketing campaigns Strong network of amul retail outlets , parlours and APO’s ( AMUL Preferred outlets) A popular mascot in the AMUL girl

Weakness 1. Lack of capital invested as compared to other companies. 2. There are many milk brands in Hyderabad which acts as major competitors, restricting the growth. 3. Amul offers fewer profit margins to its distributors and retailers. 4. Risk of highly complex supply chain management.

Opportunities 1. There is a lot of potential for growth and development as huge population stay in rural market where other companies are not targeting. 2. Rise in purchasing power of people. 3. Use of E-commerce to sell their products.

Threats 1. Competitors like Heritage, Jersey, Masqati, vijaya 2. Growing prices of milk and milk products. 3. The yield of Indian cattle is still much lower than other countries.

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TABLE1

TABLE SHOWING RESPONSE OF THE RETAILERS WITH REGARD TO DO THEY SELL AMUL MILK OR NOT.

SOURCE

NO OF RESPONDENTS

PERCENTAGE%

YES

45

90

NO

05

10

TOTAL

50

100

ANALYSIS The above table shows that 90% of retailers sell AMUL milk while the rest 10% of retailers sell other brands of milk.

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GRAPH 1

GRAPH SHOWING RESPONSE OF THE RETAILERS WITH REGARD TO DO THEY SELL AMUL MILK OR NOT.

INTERPRETATION As the above diagram shows that majority of retailers prefer to sell AMUL milk while very few retailers prefer tho sell other brands milk.

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TABLE 2

TABLE SHOWS THE RESPONSE OF THE RETAILERS WITH REGARD TO OTHER BRAND’S MILK THEY SELL OTHER THAN AMUL

SOURCE

NO OF RESPONDENTS

PERCENTAGE%

HERITAGE

19

38

JERSEY

15

30

MASQUATI

13

26

VIJAYA

3

6

TOTAL

50

100

ANALYSIS The above table shows that 38% of retailers sell heritage 30% sell jersey 26% sell masquati and 6% sell vijaya milk other than amul.

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GRAPH 2 GRAPH SHOWS THE RESPONSE OF THE RETAILERS WITH REGARD TO OTHER BRAND’S MILK THEY SELL OTHER THAN AMUL

20 18

19

16 14

15

12

13

10 8 6 4 2

3

0 A) Heritage

B)Jersey

C) Masqati

D) Vijaya

INTERPRETATION As the above graph shows that majority of retailers sell heritage milk followed by jersey masqati and vijaya other than AMUL . All the four brands should be considered as competitors for AMUL.

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TABLE 3

TABLE SHOWING THE RESPONSE OF THE RETAILERS WITH REGARD TO THE REASON FOR SELLING OTHER BRANDS MILK.

SOURCE

NO OF RESPONDENTS

PERCENTAGE%

MARGIN

45

90

CUSTOMER PRIORITY

5

10

AVAILABILITY

0

0

PACKING AND OTHER

0

0

TOTAL

50

100

ANALYSIS From the above table we can observe that 90% of retailers sell other brands mik for high margin compared to amul while the rest 10% sell them according to the customer preference.

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GRAPH 3

GRAPH SHOWING THE RESPONSE OF THE RETAILERS WITH REGARD TO THE REASON FOR SELLING OTHER BRANDS MILK.

45

A) Margin

5

0

0

B) Customer Priority

C) Availability

D) Packing & Other

INTERPRETATION From the above graph we can clearly observe that majority of retailers prefer to sell other brands milk for high margins and few sell them according to the customers preference. none of the retailers sell other brands because of lack of availability or packing issues with AMUL.

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TABLE 4

TABLE SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO AMOUNT OF MILK SOLD EVERY DAY.

SOURCE

NO OF RESPONDENTS

PERCENTAGE%

MORE THAN 70 LTS

10

20

30-70 LTS

20

40

11-30 LTS

15

30

LESS THAN 10 LTS

5

10

TOTAL

50

100

ANALYSIS The above table shows the quantity of milk sold per day by retailers. 20% sell more than 70 lts 40% sell between 30-70 lts 30% sell around 11-30 lts and the rest 10% sell less than 10 lts.

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GRAPH 4

GRAPH SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO AMOUNT OF MILK SOLD EVERY DAY.

25

20

15

10

5

0 MORE THAN 70 LTS

30-70 LTS

11-30 LTS

LESS THAN 10

INTERPRETATION From the above graph we can see that majority of the retailers sell more than 30 lts per day . the milk sale is very high in each retail outlet . while few oulets sell less than 10 lts a day.

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TABLE 5

TABLE SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO AMOUNT OF CURD SOLD EVERY DAY.

SOURCE

NO OF RESPONDENTS

PERCENTAGE%

LESS THAN 1 KG

25

50

1-5 KGS

15

30

MORE THAN 5KGS

10

20

TOTAL

50

100

ANALYSIS The above table states that 50% of retailers sell less than 1kg curd a day 30% sell 1-5 kgs and 20% sell more than 5kgs per day

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GRAPH 5 GRAPH SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO AMOUNT OF CURD SOLD EVERY DAY.

25

15 10

A) Less than 1 kg

B) 1-5 kgs

C) More than 5 kgs

INTERPRETATION From the above graph we can see that majority of retailers selling less than 1kg of curd per day. Eventhough they sell a lot of milk the sale of curd is very limited. AMUL should concentrste on lot of promotional activities to increase the sale of curd in the market.

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TABLE 6

TABLE SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO THEIR SATISFACTION LEVEL WITH THE SERVICE PROVIDED BY AMUL.

SOURCE

NO OF RESPONDENTS

PERCENTAGE%

HIGHLY SATISFIED

30

60

SATISFIED

10

20

NOT SATISFIED

8

16

HIGHLY NOT SATISFIED

2

4

TOTAL

50

100

ANALYSIS The above table shows that 60% of retailers are highly satisfied by the service provided by AMUL 20% are satisfied while 16% are not satisfied and 4% are highly dissatisfied.

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GRAPH 6

GRAPH SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO THEIR SATISFACTION LEVEL WITH THE SERVICE PROVIDED BY AMUL.

35 30 25 20 15 10 5 0 HIGHLY SATISFIED

SATISFIED

NOT SATISFIED

HIGHLY NOT SATISFIED

INTERPRETATION As the above graph shows that majority of retailers are highly satisfied by the service provided by AMUL while very few are not satisfied with their service.

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TABLE 7

TABLE SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO THEIR SATISFACTION TOWARDS THE DELIVERY SYSTEM OF AMUL.

SOURCE

NO OF RESPONDENTS

PERCENTAGE

YES

47

94

NO

3

6

TOTAL

50

100

ANALYSIS From the above table we can observe that 94% of retailers like the delivery system of amul while the rest 6% doesn’t like it.

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GRAPH 7

GRAPH SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO THEIR SATISFACTION TOWARDS THE DELIVERY SYSTEM OF AMUL.

6%

94%

A) Yes

B) No

INTERPRETATION The above graph shows that majority of retailers like the delivery system of amul. It means it is always on time. Especially in dairy market delivering goods on time is the most important component for any brand.

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TABLE 8

TABLE SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO THE DIFFERENCE THEY NOTICED IN AMUL MILK PRODUCTS COMPARED TO THAT OF OTHER BRANDS.

SOURCE

NO OF RESPONDENTS

PERCENTAGE

TASTE

30

60

PRICE

2

4

AVAILABILITY

3

6

DEMAND

15

30

TOTAL

50

100

ANALYSIS The above table shows that 60% of retailers feel that taste is the factor that differentiates amul from other brands while 4% feel price 6% feel availability and 30% feel demand.

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GRAPH 8

GRAPH SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO THE DIFFERENCE THEY NOTICED IN AMUL MILK PRODUCTS COMPARED TO THAT OF OTHER BRANDS.

35 30

25 20 15 10 5

0 A) Taste

B) Price

C) Availabilty

D) Demand

INTERPRETATION From the above graph we can observe that majority of retailers feel that the taste of AMUL milk products is different compared to other brands followed by its demand.

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TABLE 9

TABLE SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO THE REASON FOR NOT SELLING MORE OF AMUL PRODUCTS.

SOURCE

NO OF RESPONDENTS

MARGIN

35

PERCENTAGE% 70

AVAILABILITY

2

4

COMPETITORS

7

14

DEMAND

6

12

TOTAL

50

100

ANALYSIS The above table shows that 70% of respondents feel that margin is the only reason for not selling more of AMUL brand 4% availability 14% say competitors 12% say demand.

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GRAPH 9

GRAPH SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO THE REASON FOR NOT SELLING MORE OF AMUL PRODUCTS.

40

35 30 25 20 15

10 5 0 MARGIN

AVAILABILITY

COMPETITORS

DEMAND

INTERPRETATION From the above graph we can notice that margin is the main issue for majority of the retailers. Any retailers runs his business or sells a product only for profit . if he is not satisfied nwith the margin he will naturally sell other brand products for profits.

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TABLE 10

TABLE SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO THE SCHEMES INTRODUCED BY AMUL ARE USEFUL OR NOT

SOURCE

NO OF RESPONDENTS

PERCENTAGE

YES

47

94

NO

3

6

TOTAL

50

100

ANALYSIS The above table shows that 94% of retailers feels that the schemes introduced by amul are useful to them while the rest 6% feel that they are not.

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GRAPH 10

GRAPH SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO THE SCHEMES INTRODUCED BY AMUL ARE USEFUL OR NOT

A) Yes

B) No

INTERPRETATION

From the above graph we can notice that majority of etailers say that the schemes introduced by AMUL are useful to them. AMUL should launch more of such schemes which are beneficial to retailers so that they get motivated to sell mopre of AAMUL products.

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TABLE 11

TABLE SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO HOW MANY OF THEM WON PRIZES IN MALEMAL SCHEME

SOURCE

NO OF RESPONDENTS

PERCENTAGE

YES

40

80

NO

10

20

TOTAL

50

100

ANALYSIS The above table shows that 80% of retailers won prizes in malemal scheme while the rest 20% haven’t won any prizes.

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GRAPH 11 GRAPH SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO HOW MANY OF THEM WON PRIZES IN MALEMAL SCHEME

A) Yes B) No

INTERPRETATION From the above graph we can observe that majority of retailers won prizes in malemal scheme. AMUL should launch amany more schemes like malemal in future so that the desire to win prizes in the mind of retailers may lead to increase in indents.

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TABLE 12 TABLE SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO SINCE HOW LONG THEY ARE SELLING AMUL DAIRY PRODUCTS.

SOURCE

NO OF RESPONDENTS

LESS THAN 6 MONTHS

10

PERCENTAGE% 20

6-12 MONTHS

20

40

1-2 YEARS

15

30

MORE THAN 2 YEARS

5

10

TOTAL

50

100

ANALYSIS The above table shows that 20% of retailers selling amul dairy products since the last six months while 49% since last 12 months 30% since last 2 years and 10% since more than 2 years.

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GRAPH 12

GRAPH SHOWING THE RESPONSE OF RETAILERS WITH REGARD TO SINCE HOW LONG THEY ARE SELLING AMUL DAIRY PRODUCTS.

25

20

15

10

5

0 less than 6 months

6-12 months

1-2 years

more than 2 years

INTERPRETATION From the above graph we can observe that majority of retailers are selling amul products since more than 12 months. A lot of new additions are also taking place in the last 6 months . this is a good sign for any dairy company

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Summary of findings

             

Majority of the retailers prefer to sell AMUL milk for its quality. It is found that heritage is the brand that is being sold by most of the retailers . Most of the retailers give much importance to the margin that they are being provided and the also focus on the timely delivery of milk and curd. It is observed that most of the retailers sell different brands based on the benifits they are getting out of it. 60% of the retailers are satisfied by the service provided by AMUL. Majority of retailers are highly satisfied by the delivery system of AMUL. Retailers fell that taste is the main differential factor between AMUL milk and other brands milk. Majority of retailers have margin issues with AMUL brand. Majority of retailers are beneficiated by various schemes introduced by AMUL such as Malemal scheme, PM sales . More than 70% of AMUL retailers have won prizes in Malemal scheme. Majority of AMUL retailers are selling its products since a long time. Majority of retailers prefer to sell other brand products if the margin given by one brand is not satisfactory, Majority of retailers feel that customers would mostly prefer amul milk over other brands. Majority of retailers fell that ‘high margin’ is the most important factor they consider while selling a dairy product.

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Suggestions



Retailers margin has to be increased.



Retailers will not be loyal to any brand, they are fully related to profit margin they are getting. According to this data margin of the product will have actual impact on sales.



Greater the satisfaction level, greater the sale , amul have to focus on the people who are not satisfied. To increase retailers sales we have to provide an easier process of problem identification and problem solving system.



AMUL should launch many more schemes like Malemal scheme which are beneficial to retailers.



Amul should do more of promotional activities to increase its average sale.



Retailers margin should be increased mainly in milk segment.



The company should diversify with many more outlets (AMUL Prefered outlets).

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Conclusion



The project title being “ a study on comparative marketing strategies of milk and milk products at GCMMF LTD” . after completion of study and careful analysis of the data collected can conclude that AMUL is very successful in implementing its marketing strategies compared to its competitors. The only concern which is affecting the sales of AMUL is its margin. Majority of the retailers prefer to sell other brands for margin as it is the only factor which a retailer wants. If AMUL increases the margin for retailers then the sales will shoot- up and it may gain a larger market.

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ANNEXURE Questionnaire for retailers Respected sir/madam I student of INSTITUTE OF PUBLIC ENTERPRISE , Hyderabad is currently doing my summer internship from AMUL, and conducting a survey on comparative marketing strategies. In my effort to collect data , i have prepared a sample questionnaire . it would help me immensely in my internship if i get to know your views. The information received will remain confedential. Name of the retailer: 1. Are you selling Amul milk? a. yes

b. No

2. Brands that you prefer to sell other than Amul? a. Heritage b. Jersey c. Masqati d. Vijaya 3. Reason for selling other brands milk? a. margin

b. Customer priority

c. Availability

d. Packing and other

4. Quantity of milk sold per day? a. More than 70 ltr b. 30-70 litres c. 11-30 ltrs d. Less than 10 ltrs 5. How much quantity of curd being sold per day? a. less than 1kg b. 1-5 kgs c. more than 5 kgs 6. How satisfied are you by the services provided by Amul? a. highly satisfied b. satisfied. c. not satisfied d. highly not satisfied 2016-2018

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7. Do you like the delivery system of Amul? a. yes b. No 8. what is the difference that you observed with Amul milk products compared to other brands? a. taste b. price c. availability d. demand 9. what is the reason for not selling more of amul products? a. margin b. availability c. competitors d. demand 10. Are the schemes introduced by amul are useful to you? a.yes b no 11. Have you won any prizes in malemaal scheme? a. yes

b. No

12. how long you have been selling amul products? a. less than 6 months b. 6-12 months c. 1-2 yrs d. more than 2 years

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BIBLIOGRAPHY

 Milk marketing in INDIA: A review paper on the role and performance of informal sector by Indian society of Agribusiness Professionals.  Karmakar, K.G.,& Banerjee, G.D.(2006). Oppurtunities and challanges in the Indian dairy industry.  www.indiancooperative.com  www.gcmmf.com  www.dairyindia.com  www.vijayamilk.com  www.apddcf.gov.in  http: //www.mbaskool.com/brandguide/food-and-beverages/3349-amul.html

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