Emerging Stratgies of Dairy Produts

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EMERGING STRATERGIES OF DAIRY

PRODUCTS


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DECLARATION

St. Andrews College of Arts, Science and Commerce

St. Dominic Road,

Bandra (West),

Mumbai 400 050 .

I Steffi Leitao of St. Andrews College, M.Com Part I hereby declare that I have completed

the project on EMERGING STRATERGIES OF DAIRY PRODUCTS in the academic

year 2013-14.The information submitted is true and original to the best of my know

Place: Mumbai Signature of Student

Steffi Leitao


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CERTIFICATE

It is certified that this project Emerging Strategies of Dairy Productshas been prepared and submitted by Steffi Leitao under my guidance during theacademic year 2013-2014.

Date: Signature(Dr.

________________)Place: (AssociateProfessor)

Signature of the Signature of the Signature of theInternal Examiner External Examiner Principal


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Index

Sr.No. Topic Page No.

Chapter I Introduction to the Study

1.1 Strategic Management Introduction

1.2 Types

Chapter II Indian Dairy Industry

2.1 Overview

2.2 Past , Present & Future of the Indian Dairy Industry

2.3 Facts

2.4 SWOT Analysis

Chapter 3 Research Methodology

Chapter 4 Strategies of Emerging Dairy Markets

4.1 Overview

4.2 Potential growth factors

4.3 Major products

4.5 Major Players

Chapter 5 Case Study

Chapter 6 Limitations

Chapter 7 Suggestion and Recommendation

Chapter 8 Conclusion

Bibliography


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CHAPTER 1

1.1 INTRODUCTION

Definition1. A method or plan chosen to bring about a desired future, such as achievement of a goal or

solution to a problem.

2. The art and science of planning and marshalling resources for their most efficient and

effective use. The term is derived from the Greek word for general ship or leading an army.

Origin

The strategic management discipline originated in the 1950s and 1960s. Among the

numerous early contributors, the most influential were Alfred Chandler, Philip Selznick, Igor

Ansoff, and Peter Drunker. The discipline draws from earlier thinking and texts on 'strategy'

dating back thousands of years.

Alfred Chandler recognized the importance of coordinating management activity under an

all-encompassing strategy. Interactions between functions were typically handled bymanagers who relayed information back and forth between departments. Chandler stressed

the importance of taking a long term perspective when looking to the future. In his 1962

ground breaking work Strategy and Structure , Chandler showed that a long-term coordinated

strategy was necessary to give a company structure, direction and focus. He says it concisely,

structure follows strategy .

In 1957, Philip Selznick formalized the idea of matching the organization's internal factors

with external environmental circumstances .[7] This core idea was developed into what we

now call SWOT analysis by Learned, Kenneth R. Andrews, and others at the Harvard

Business School General Management Group. Strengths and weaknesses of the firm are

assessed in light of the opportunities and threats in the business environment.
http://www.businessdictionary.com/definition/method.htmlhttp://www.businessdictionary.com/definition/plan.htmlhttp://www.businessdictionary.com/definition/goal.htmlhttp://www.businessdictionary.com/definition/solution.htmlhttp://www.businessdictionary.com/definition/problem.htmlhttp://www.businessdictionary.com/definition/science.htmlhttp://www.businessdictionary.com/definition/planning.htmlhttp://www.businessdictionary.com/definition/resource.htmlhttp://www.businessdictionary.com/definition/effective.htmlhttp://www.businessdictionary.com/definition/leader.htmlhttp://en.wikipedia.org/wiki/Strategyhttp://en.wikipedia.org/wiki/Alfred_D._Chandler,_Jr.http://en.wikipedia.org/wiki/Structure_follows_strategyhttp://en.wikipedia.org/wiki/Structure_follows_strategyhttp://en.wikipedia.org/wiki/Philip_Selznickhttp://en.wikipedia.org/wiki/Strategic_management#cite_note-7http://en.wikipedia.org/wiki/Strategic_management#cite_note-7http://en.wikipedia.org/wiki/Strategic_management#cite_note-7http://en.wikipedia.org/wiki/SWOT_analysishttp://en.wikipedia.org/wiki/Kenneth_R._Andrewshttp://en.wikipedia.org/w/index.php?title=Harvard_Business_School_General_Management_Group&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Harvard_Business_School_General_Management_Group&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Harvard_Business_School_General_Management_Group&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Harvard_Business_School_General_Management_Group&action=edit&redlink=1http://en.wikipedia.org/wiki/Kenneth_R._Andrewshttp://en.wikipedia.org/wiki/SWOT_analysishttp://en.wikipedia.org/wiki/Strategic_management#cite_note-7http://en.wikipedia.org/wiki/Philip_Selznickhttp://en.wikipedia.org/wiki/Structure_follows_strategyhttp://en.wikipedia.org/wiki/Alfred_D._Chandler,_Jr.http://en.wikipedia.org/wiki/Strategyhttp://www.businessdictionary.com/definition/leader.htmlhttp://www.businessdictionary.com/definition/effective.htmlhttp://www.businessdictionary.com/definition/resource.htmlhttp://www.businessdictionary.com/definition/planning.htmlhttp://www.businessdictionary.com/definition/science.htmlhttp://www.businessdictionary.com/definition/problem.htmlhttp://www.businessdictionary.com/definition/solution.htmlhttp://www.businessdictionary.com/definition/goal.htmlhttp://www.businessdictionary.com/definition/plan.htmlhttp://www.businessdictionary.com/definition/method.html


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Overview

Strategic management is a level of managerial activity below setting goals and above tactics.

Strategic management provides overall direction to the enterprise and is closely related to thefield of Organization Studies. In the field of business administration it is useful to talk about

"strategic consistency" between the organization and its environment or "strategic

consistency." According to Arieu (2007), "there is strategic consistency when the actions of

an organization are consistent with the expectations of management, and these in turn are

with the market and the context." Strategic management includes the management team and

possibly the Board of Directors and other stakeholders. "Strategic management is an ongoing

process that evaluates and controls the business and the industries in which the company is

involved; assesses its competitors and sets goals and strategies to meet all existing and

potential competitors; and then reassesses each strategy annually or quarterly [i.e. regularly]

to determine how it has been implemented and whether it has succeeded or needs

replacement by a new strategy to meet changed circumstances, new technology, new

competitors, a new economic environment., or a new social, financial, or political

environment. Strategic Management can also be defined as "the identification of the purpose

of the organisation and the plans and actions to achieve the purpose. It is that set of

managerial decisions and actions that determine the long term performance of a business

enterprise. It involves formulating and implementing strategies that will help in aligning the

organization and its environment to achieve organisational goals."

1.2 Types of Strategies

Growth Strategy

A growth strategy entails introducing new products or adding new features to existing

products. Sometimes, a small company may be forced to modify or increase its product line

to keep up with competitors. Otherwise, customers may start using the new technology of a

competitive company. For example, cell phone companies are constantly adding new features

or discovering new technology. Cell phone companies that do not keep up with consumer
http://en.wikipedia.org/wiki/Tactic_%28method%29http://en.wikipedia.org/wiki/Organization_Studieshttp://en.wikipedia.org/wiki/Stakeholder_%28corporate%29http://en.wikipedia.org/wiki/Stakeholder_%28corporate%29http://en.wikipedia.org/wiki/Organization_Studieshttp://en.wikipedia.org/wiki/Tactic_%28method%29


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demand will

not stay in business very long.

A small company may also adopt a growth strategy by finding a new market for its products.

Sometimes, companies find new markets for their products by accident. For example, a small

consumer soap manufacturer may discover through marketing research that industrial

workers like its products. Hence, in addition to selling soap in retail stores, the company

could package the soap in larger containers for factory and plant workers.

Product Differentiation Strategy

Small companies will often use a product differentiation strategy when they have acompetitive advantage, such as superior quality or service. For example, a small

manufacturer or air purifiers may set themselves apart from competitors with their superior

engineering design. Obviously, companies use a product differentiation strategy to set

themselves apart from key competitors. However, a product differentiation strategy can also

help a company build brand loyalty, according to the article "Porter's Generic Strategies" at

QuickMBA.com.

Price-Skimming Strategy

A price-skimming strategy involves charging high prices for a product, particularly during

the introductory phase. A small company will use a price-skimming strategy to quickly

recover its production and advertising costs. However, there must be something special about

the product for consumers to pay the exorbitant price. An example would be the introduction

of a new technology. A small company may be the first to introduce a new type of solar

panel. Because the company is the only one selling the product, customers that really want

the solar panels may pay the higher price. One disadvantage of a price-skimming is that it

tends to attract competition relatively quickly, according to the Small Business

Administration. Enterprising individuals may see the profits the company is reaping and

produce their own products, provided they have the technological know-how.

Acquisition Strategy A small company with extra capital may use an acquisitionstrategy to gain a competitive advantage. An acquisition strategy entails purchasing another


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company, or one or more product lines of that company. For example, a small grocery retailer

on the east coast may purchase a comparable grocery chain in the Midwest to expand its

operations


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Chapter 2

2.1 Overview of the Indian Dairy Industry

In India, the dairy sector plays an important role in the country s socio-economic

development, and constitutes an important segment of the rural economy. Dairy industry

provides livelihood to millions of homes in villages, ensuring supply of quality milk and milk

products to people in both urban and rural areas. With a view to keeping pace with the

country s increasing demand for milk and milk products, the industry has been growing

rapidly. According to our research report Indian Dairy Industry Analysis , India is the

world s largest milk producer, accounting for around 17% of the global milk production.

Besides, it is one of the largest producers as well as consumers of dairy products. Due to their

rich nutritional qualities, the consumption of dairy products has been growing exponentially

in the country, and considering such facts and figures, our study anticipates that the milk

production in India will grow at a CAGR of around 4% during 2011-2015.

With the rising use of dairy products, the secondary market for dairy products has also beenflourishing, our report observed. For this, we have included the analysis of secondary market

for dairy products, including tea, coffee, infant nutrition, malted foods, and bakery products.

Covering the necessary aspects of the Indian dairy industry, the study facilitates knowledge

about its current market scenario and future growth. Analysing the past and current state of

the industry, the report tries to find out how trends like the entry of international companies

and safe packaging are attracting more consumers and leading to further growth in the

market. This way, it presents a clear picture of the direction, in which the industry is likely to proceed in the coming years.


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2.2 Current Scenario of the Indian dairy industry - Past, Present And The

Boom Ahead

Traditionally India had some of the best cattle breeders in the world and most high yielding

genetic stock. But that is until the British arrived in India. With the advent of British era

urbanization around India, major sea ports such as Mumbai. Chennai, Cochin, Kolkotta and

the national capital Delhi started growing rapidly. This ever increasing population meant a

rising demand for milk resulting into formation of what is now known as "tabelas" or

"khattals", enclosures where cows and buffalos were reared for milk. If one takes a local train

from north of Mumbai to South, you can still spot a large number of these enclosures along

side the railway tracks. These tabela owners are keen to maximize their profits and they

would bring best of the high yielding buffalos from hinter-land some along with their young

calves and within a week they would wean away the calf and send it to slaughter house. The

buffalo will be reared for a few lactation cycles and then disposed off to a slaughter house.

The empty slots in the tabela are soon replaced with next best stock purchased from the

hinterland.

In 1946 when Amul came into existence, a new beginning of farmer-owned organized dairy

cooperative movement took hold. Till then all of the government milk schemes, were moremilk distribution & urban consumer focused rather than on milk production. As the AMUL

model grew - providing a fair market access and remunerative prices to the farmers along

with services such veterinary care, balanced cattle feed supply, artificial insemination,

progeny tested frozen semen - the supplies of milk production and its productivity started

going up. For the first time in about 200 years then, someone was trying to stop and reverse

almost 1000 year of animal genetic stock deterioration.

Between mid seventies to nineties, the dairy cooperative movement spread to more than 200milk producing districts of India with milk production growing at 4 to 5% per annum.

Even with limited gains on productivity, scarce fodder, frequent draughts the farmers largely

dependent on agric-residual feeding and even then India emerged as one of the largest

producers of milk in the world. Another startling thing happened - the per capita milk

consumption rose and was almost equal to the global average.

Secondly we need to realize that as a nation while our per capita milk consumption is almost

at par with the rest of the world; our nation is still suffering malnutrion on a large scale.

Health of our women and children is poor especially among the rural and urban poor. We are
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short on high quality protein intake, but in the name of liberalization we export millions of

tonnes of soya, cotton-seed, rap-seed, mustard-seed, all of which contain 30% to 40% of

crude protein. Imagine if this was fed to our cows, buffalos or used in poultry this crude

protein would have been converted in to highly digestible protein which children of this

country needs most. Converting and feeding such meal to our cattle would generate

employment in villages, especially of women. We should first make enough fodder available

locally at an affordable rate. Earlier until the 90's governments had imposed a levy of 20% on

export of protein-meal. This kept the exports in check and ensured meals are available for

domestic consumption for dairy and poultry industry at least 20% cheaper then world market!

This not only enabled the country to enhance milk and egg production, but also created

employment and keeps these local businesses more competitive. But since the 90's

our governments have failed to take right steps to boost availability of fodder, protein meal

and now when milk prices go up, the governments resorts to banning exports of milk

powders, casein and even go to the extent of importing milk powder..

For more than a hundred years the Indian dairy industry suffered cattle genocide and only

with advent of amul in 1946 did the wheel start to turn back and in the right direction. If well

managed, the next two decades will be golden eras of milk production and productivity

gains. Country s economyis going to boom for the next few decades powered by a young

population and hence the market for milk and value added a milk product is going to grow

hand-in-hand predictably at an unprecedented pace.

Indian food habits vary from region to region in the country. Rice is predominant in east and

south while wheat is staple in north and west. But having said that, milk is the most common

food all across. Milk has 99% penetration and is considered a wholesome food by every

Indian.

The challenge therefore is to make it affordable and available.

Affordability is clearly a result of equaling the supply to the demand. But make no mistake,supply needs to sustainable and local - as an outstripping demand will place huge pressure on

milk supplies especially if the supply increments are managed by importing from outside.

That would be an unsustainable solution.


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2.3 TRUE FACTSMilk and dairy products are providers of calcium, phosphorous and protein which are allessential for healthy bone growth and development.

Consumption of milk and dairy from early childhood and throughout life can help make

bones strong.

The amounts of calcium in milk and dairy products are beneficial for healthy teeth.

Milk has been shown not to cause tooth decay and therefore it is also one of the best drinks to

have between meals

June is dairy month

In 1856, French scientist Louis Pasteur discovered that heating liquids to high temperatures

kills bacteria. This process is called pasteurization, and it protects the purity and flavours of

milk.

The best sources of calcium are milk, yogurt, and cheese. About 72% of the calcium in the

U.S. food supply comes from dairy foods.

These foods also provide protein and several other important nutrients.

According to the Federal Government's Food Guide Pyramid , children ages 9-18 need 3

servings of dairy products daily. Only 30 per cent of teenage boys and 12 per cent of teenage

girls meet this recommendation.

Calcium in soy milk is not as readily available for the body to use as it is in cow's milk.

25 gallons of milk can make 9 gallons of ice cream, 25 pounds of cheese, or 11 pounds of

butter. It takes about 30 cups of milk to make 1 pound of butter.

Refrigerator

Milk remains fresh for 7-10 days after the expiration date if refrigerated at 35-40F. Each 5

(F) rise in temperature shortens milk's shelf life by 50% because of bacteria growth.


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following areas must be tapped:

Value addition: There is a phenomenal scope for innovations in product development, packaging and presentation. Given below are potential areas of value addition:

o Steps should be taken to introduce value-added products like shrikhand , ice creams, paneer, khoa , flavored milk, dairysweets, etc. This will lead to a greater presence and flexibilityin the market place along with opportunities in the field of

brand building.o Addition of cultured products like yoghurt and cheese lend

further strength - both in terms of utilization of resources and presence in the market place.

o A lateral view opens up opportunities in milk proteins throughcasein, caseinates and other dietary proteins, further openingup export opportunities.

o Yet another aspect can be the addition of infant foods,geriatric foods and nutritionals.

Export potential: Efforts to exploit export potential are already on.Amul is exporting to Bangladesh, Sri Lanka, Nigeria, and the MiddleEast. Following the new GATT treaty, opportunities will increasetremendously for the export of agri-products in general and dairy

products in particular.

Top

Threats:

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

The study of this SWOT analysis shows that the strengths andopportunities far outweigh weaknesses and threats . Strengths andopportunities are fundamental and weaknesses and threats are transitory. Anyinvestment idea can do well only when you have three essential ingredients:

entrepreneurship (the ability to take risks), innovative approach (in productlines and marketing) and values (of quality/ethics).

The Indian dairy industry, following its delicensing, has been attracting alarge number of entrepreneurs. Their success in dairying depends on factorssuch as an efficient yet economical procurement network, hygienic and cost-effective processing facilities and innovativeness in the market place. All thatneeds to be done is: to innovate, convert products into commerciallyexploitable ideas. All the time keep reminding yourself: Benjamin Franklindiscovered electricity, but it was the man who invented the meter that reallymade the money!
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CHAPTER 3

RESEARCH METHDOLOGY


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CHAPTER 4

Strategies of Emerging Dairy Markets

4.1 OverviewIndia has one of the largest livestock populations in the world. Fifty per cent of the buffaloes

and twenty per cent of the cattle in the world are found in India, most of which are

Milk cows and buffaloes. Dairy development in India has been acknowledged the world over

as one of modern India s most successfuldevelopmental programme. Today, India is the

largest milk producing country in the world. Milk and milk products is rated as one of the

most promising sectors which deserves appreciation in a big way. When the world milk

production registered a negative growth of 2 per cent, India performed much better with 4 per

cent growth. The total milk production is over 72 million tonnes and the demand for milk is

estimated at around 80 million tonnes. By 2005, the value of Indian dairy produce is expected

to be Rs. 1,000,000 million. In the last six years foreign investment in this sector stood at

Rs. 3600 million which is about one fourth of the total investments made in this sector.

Manufacture of casein and lactose, largely being imported presently, has good scope. Exports

of milk products have been decimalised. The milk surplus states in India are Uttar Pradesh,

Punjab, Haryana, Rajasthan, Gujarat, Maharashtra, Andhra Pradesh, Karnataka and Tamil

Nadu. The manufacturing of milk products is concentrated in these milk surplus States.

According to one estimate, the packed milk segment would double in the next five years,

giving both strength and volume to the modern sector. The narrow tip at the top is a small but

affluent market for western type milk products .

4.2 Potential for further growth

Of the three A's of marketing - availability, acceptability and affordability , Indian dairying

is already endowed with the first two. People in India love to drink milk . Hence no efforts

are needed to make it acceptable. Its availability is not a limitation either, because of the

ample scope for increasing milk production, given the prevailing low yields from dairy cattle.

It leaves the third vital marketing factor affordability. How to make milk affordable for the

large majority with limited purchasing power? That is essence of the challenge. One practical


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way is to pack milk in small quantities of 250 ml or less in polythene sachets. Already, the

glass bottle for retailing milk has given way to single-use sachets which are more

economical. Another viable alternative is to sell small quantities of milk powder in mini-

sachets, adequate for two cups of tea or coffee.

Marketing Strategy for 2000 AD

Two key elements of marketing strategy for 2000 AD are: Focus on strong brands and,

product mix expansion to include UHT milk, cheese, ice creams and spreads. The

changing marketing trends will see the shift from generic products to the packaged quasi,

regular and premium brands. The national brands will gradually edge out the regional

brands or reduce their presence. The brand image can do wonders to a product's

marketing as is evident from the words of Perfume Princess Coco Channel: In the factory,we pack perfume; in the market, we sell hope !

4.3 Emerging Dairy Markets

Food service institutional market: It is growing at double the rate of consumer market

Defence market: An important growing market for quality products at reasonable

prices

Ingredients market: A boom is forecast in the market of dairy products used as rawmaterial in pharmaceutical and allied industries

Parlor market: The increasing away-from-home consumption trend opens new vistas for

ready-to-serve dairy products which would ride piggyback on the fast food revolution

sweeping the urban India

. Penetration of milk products

Western table spreads such as butter, margarine and jams are not very popular in India.All India penetration of butter/ margarine is only 4%. This is also largely represented by

urban areas, where penetration is higher at 9%. In rural areas, butter/ margarine have

penetrated in 2.1% of households only. The use of these products in the large metros is

higher, with penetration at 15%.

Penetration of cheese is almost nil in rural areas and negligible in the urban areas. Per

capita consumption even among the cheese-consuming households is a poor 2.4kg pa as

compared to over 20kg in USA. The lower penetration is due to peculiar food habits,


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relatively expensive products and also non-availability in many parts of the country.

Butter, margarine and cheese products are mainly manufactured by organized sector.

Similarly, penetration of ghee is highest in medium sized towns at 37.2% compared to

31.7% in all urban areas and 21.3% in all rural areas. The all India penetration of ghee is24.1%. In relative terms, penetration of ghee is significantly higher in North and West,

which are milk surplus regions. North accounts for 57% of ghee consumption and West

for 23%, South & East together account for the balance 20%. A large part of ghee is made

at home and by small/ cottage industry from milk. The relative share of branded products

in this category is very low at around 1-2%.

Milk powder and condensed milk have not been able to garner any significant consumer

acceptance in India as indicated by a very low 4.7% penetration. The penetration is higher at 8.1% in urban areas and lower at 3.5% in rural areas. Within urban areas, it is relatively

higher in medium sized towns at 8.5% compared to 7.7% in a large metros .

Packaging Technology

Milk was initially sold door-to-door by the local milkman. When the dairy co-operatives

initially started marketing branded milk, it was sold in glass bottles sealed with foil. Over

the years, several developments in packaging media have taken place. In the early 80's,

plastic pouches replaced the bottles. Plastic pouches made transportation and storage very

convenient, besides reducing costs. Milk packed in plastic pouches/bottles have a shelf

life of just 1-2 days, that too only if refrigerated. In 1996, Tetra Packs were introduced in

India. Tetra Packs are aseptic laminate packs made of aluminium, paper, board and

plastic. Milk stored in tetra packs and treated under Ultra High Temperature (UHT)

technique can be stored for four months without refrigeration. Most of the dairy co-

operatives in Andhra Pradesh, Tamil Nadu, Punjab and Rajasthan sell milk in tetra packs.

However tetra packed milk is costlier by Rs5-7 compared to plastic pouches. In 1999-00

Nestle launched its UHT milk. Amul too re-launched its Amul Taaza brand of UHT milk.

The UHT milk market is expected to grow at a rate of more than 10-12% in coming years.

Product development:

Dairy foods can be manufactured and packaged for export to countries where Indian

food enjoys basic acceptance. The manufacturing may be carried out in contract plants inIndia. An option to market the products in collaboration with local establishments or


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Branding Of Traditional Milk Products

Among the traditional milk products, ghee is the only product, which is currently

marketed, in branded form. main ghee brands are Sagar, MilkMan (Britannia), Amul

(GCMMF), Aarey (Mafco Ltd), Vijaya (AP Dairy Development Cooperative Federation),

Verka ( Punjab Dairy Cooperative), Everyday (Nestle) and Farm Fresh (Wockhardt).

With increasing urbanization and changing consumer preferences, there is possibility of

large scale manufacture of indigenous milk products also. The equipments in milk

manufacturing have versatility and can be adapted for several products. For instance,

equipments used to manufacture yogurt also can be adapted for large scale production of

Indian curd products (dahi and lassi). Significant research work has been done on dairy

equipments under the aegis of NDDB.

Mafco Limited sells Lassi under the Aarey brand and flavoured milk under the Energee

franchise (in the Western region, mainly in Mumbai). Britannia has launched flavored

milk in various flavors in tetra packs.

GCMMF has also made a beginning in branding of other traditional milk products withthe launch of packaged Paneer under the Amul brand. It has also created a new umbrella

brand "Amul Mithaee", for a range of ethnic Indian sweets that are proposed to be

launched The first new product Amul Mithaee Gulabjamun has already been launched in

major Indian markets.

Western Milk Products

Western milk products such as butter, cheese, yogurt have gained popularity in the Indian

market only during the last few years. However consumption has been expanding with

increasing urbanization.

Butter

Most Indians prefer to use homemade white butter (makkhan) for reasons of taste and

affordability. Most of the branded butter is sold in the towns and cities. The major brands

are Amul, Vijaya, Sagar, Nandini and Aarey. Amul is the leading national brand while the

other players have greater shares in their local markets. The latest entrant in the butter market has been Britannia. Britannia has the advantages of a wide distribution reach and a


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strong brand recall. Priced at par with the Amul brand, it is expected to give stiff

competition to the existing players. In 1999-00 the butter production is estimated at 4 lakh

MT of this only 45K MT is in the white form used for table purposes rest all is in the

yellow form.

Cheese

The present market for cheese in India is estimated at about 9,000 tonnes and is growing

at the rate of about 15% per annum. Cheese is mainly consumed in the urban areas. The

four metro cities alone account for more than 50% of consumption . Mumbai is the largest

market (accounting for 30% of cheese sold in the country), followed by Delhi (20%).

Calcutta (7%) and Chennai (6%). Mumbai has a larger number of domestic consumers,

compared to Delhi where the bulk institutional segment (mainly hotels) is larger.

Milk Powder

Milk powder is mainly of 2 types

Whole milk powder

Skimmed milk powder

Whole milk powder contains fat, as distinguished from skimmed milk powder, which is

produced by removing fat from milk solids. Skimmed milk powder is preferred by diet

conscious consumers. Dairy whiteners contain more fat than skimmed milk powder but

less compared to whole milk powder. Dairy whiteners are popular milk substitute for

making tea, coffee etc. The penetration of these products in milk abundant regions is

driven by convenience and non perishable nature (longer shelf life) of the product.

Dairy sector of advanced nations export milk products with a subsidy of $ 1000 per tonne

with a level of subsidy more than 60 % of the price of milk powder produced in India,

this has led to large scale imports of milk powder both in whole and skimmed form. To

protect the domestic sector from these subsidized imports the central government has

recently increased the basic import duty on all imports of milk powder more than 10000

MT to 60% from 15%. For imports less than 10000 MT the basic customs duty has been

left unchanged at 15%.

In 1999-00 India is estimated to have imported about 18,000 tonnes of milk powder

against a total estimated production of 2.40 Lakh MTs. In 2000-01 India is expected to


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export 10000 MT of skimmed milk powder due to rise in international prices to $2300 per

MT from last year's levels of $1400 per MT. These expectations are based on the strong

demand from Russia, East Asia and Latin America, and also on tightening of supply in

EU, which accounts for 75% of the annual global Skimmed Milk Powder exports.

4.5 Major Players

Amul as well the l eading brands in the dairy whitener segment are Nestl s every day,GCMMF's Amulya, Dalmia Industry's Sapan, Quality Dairy India's KreamKountry,Wockhardt's Farm Fresh and Britannia's Milkman Dairy Whitener. Today, India is the largest milk producing country in the world.

World's major milk producers

(Million MTs)

Country 1997-98 1998-99 (Approx.)

India 71 74.5

USA 71 71

Russia 34 33

Germany 27 27

France 24 24

Pakistan 21 22

Brazil 21 27

UK 14 14

Ukraine 15 14

Poland 12 12

New Zealand 11 12

Netherlands 11 11

Italy 10 10


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In order to maintain costs at lower levels, Amul India has never spent more than 1% of its budget on advertising. However it has still been successful in creating the same impact, itcreated 60 years ago through its simple yet appealing ad campaigns.

Talk about universally recognizable Brands grown in India, and one prominent contender is

the Amul mascot, a cute and chubby girl usually dressed in a polka dot. Over 45 years of existence, the brand has always given a fresh flavour to Amul Mascot.

The Amul Girls and its new Witty avatar was the brain child of Sylvester da Cunha, themanaging director of the advertising agency AS. The ads were designed as a series of hoardings with designs relating to day-to-day issues.

Amul Dairy Cooperatives, on the occasion of completing its 50 years of advertising, launcheda book called Amul India .

The Manthan music video has a unique emotional appeal. To recreate the magic, in 2012 brand came up with a fresh commercial with the lines like khushrahetera beta beti in thenew music video. It shows how the efforts of a rural milk producer take care of nutritionalrequirements of a child of a urban mother.

Products Packaging

Amul s marketing strategy has always been consumer centric. Thus it is kept in mind that the packaging of all Amul products appeals to the emotional side of the consumer.

Use of Expression

For example the human facial expression of delight on the cheese variant packing reveal the pleasure people derive from consuming cheese and cheese products.

Information

Also the need to highlight the nutrient value and best possible use of the product is animportant feature of all Amul products packaging.

Protection

Recently Amul has focused largely upon capturing the branded tetra pack market with,variants that would last for over 2 weeks to three months even without refrigeration.

Place

In a product and price parity situation, the brand that sells more is the one that reaches thehighest number of customers. India 1 billion people, 155 million household has over 4million retail outlets in 5351 urban markets and 552725 villages, spread cross 3.28 million sq.

Promotion

If an advertisement is to communicate effectively, the receiver must at least half want it to,and be prepared to take step toward the sender. Effective advertising is rarely hectoring or


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loudly explicit. It often both attracts and generates arm feelings. More often than not, asuccessful campaign has a stronger element of the unexpected a quality that good advertisingshares with much worthwhile literature. To penetrate into the inner recesses of her memory,communication must first ensure exposure, grab her attention evoke her comprehension, grabher acceptance and then extract retention competing with thousands of other units of

communication trying to do the same

Other strategies:

Amul star voice of India

Amul master chief

Amul ustad and there are cafes as well as ice cream parlour of AMUL

Nestle Nestl is the world's leading Nutrition, Health and Wellness Company. Our mission of "Good

Food, Good Life" is to provide consumers with the best tasting, most nutritious choices in a

wide range of food and beverage categories and eating occasions, from morning to night.

The Company was founded in 1866 by Henri Nestl in Vevey, Switzerland, where our

headquarters are still located today. They employ around 2, 80,000 people and have factories

or operations in almost every country in the world. Nestl sales for 2009 were CHF 10.Nestl

India has a wide portfolio for Milk Products and Nutrition.

Nestl India follows this Charter and also complies with The Infant Milk Substitutes, Feeding

Bottles and Infant Foods (Regulation of Production, Supply and Distribution) Act, 1992 that

guides the sale of infant nutrition products in India. Nestl India does not advertise its Infant

Nutrition products .

Marketing strategies of Nestle

To target the market in such a way as to maximise profits.

National Geographic promotes itself on Social Media now like Facebook, Twitter and

other site. National Geographic has numerous widgets that it offers for its fans (I

counted 9 on its site). These include a news widget, puzzle widget, and multiple photo

widgets that are all easy to share within multiple networks and personal blogs. Most

of these can be found within the main site, but some are also found within the


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MySpace page as well. They effectively provide users with a way to interact and have

fun with the brand. With such a substantial fan base, these should be promoted on

areas of the site with more visibility or in place of advertising in order to increase the

chances of these being installed.

It never compromises on quality

Nestle products are available in every town and city.

Their target children and women bearing children as well as elderly women

Big idea sportsman and sportswomen using milk pack as a drink during their sports

interval.

Increasing health awareness especially amongst women and children.

Promotion.

Nestle uses advertising such as TV, magazines, billboards, film media, and print ads to

promote their products. Remember that commercial that had the rabbit drinking chocolate

milk? That was a Nestle promotional advertisement.

Public Relations:

As far as the public relations are concerned, the organization releases an annual report which

includes the company s financial statements along with the sales of all product categories.

The annual report is mainly aimed at the stockholders. However, another very important form

of public relations are the newsletters and bi-monthly magazines issued by the organization.

A huge amount of information is found in these regarding the products and their promotion.

IN the same way, Nestle Pure Life was given quite a bit of importance in the newsletters

issued after its launch, which obviously helped in creation of the awareness of this brand.

PRODUCT LIFE CYCLE:

If we look nestle pure life water in product life cycle than it easy to judge that it is atintroduction stage because Nestle is the market pioneer and at this stage its profit is negative

or low due to low sale and high distribution and promotion .Other major reason to be at

introduction stage is unawareness in rural areas. The people are not aware to the pure life

water that is why their sale is low. They can bring change in product life cycle by effective

promotion, by formulating new price strategies etc.

PRICE FIXATION STRATIGIES:


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Profit Earning: Profit earning is the main objective of every company but in case of nestle

their profit margin is low. Only a few amountof profit is collected from pure life water.

Customer satisfaction: In nestles pure life price is not fixed by keeping in mind profit motive,

only customer satisfaction is kept in mind while fixing the price.

STRATIGIES FOR FIXING THE PRICE:

In nestle prices are set on cost basis as given below:

Price = Cost + Profit and Break even or Target price.

Mother dairy

Mother Dairy was set up in 1974 under the Operation Flood Programme. A wholly owned

company of the National Dairy Development Board (NDDB). Mother Dairy manufactures,markets & sells milk and milk products under the Mother Dairy brand (Milk, Cultured

Products, Ice Creams, Paneer and Ghee), Dhara range of edible oils, Safal range of fresh Fruit

& vegetables, Frozen Vegetables, Processed Fruit & Vegetable Products, Fruit Pulps &

Concentrates in bulk aseptic packaging and fruit juices at a national level through its sales

and distribution networks for marketing food items.

STRAREGIES OF MOTHER DAIRY

Procurement : Fresh milk is sourced directly from state level co-operatives and Mother Dairy

2own 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.

GMP & Hygiene : Good manufacturing Practices (GMP) for our manufacturing units are a

given , they are part of our heritage of producing best quality and safe products. We maintain


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highest level of GMP and hygiene requirements for production and handling of safe products

for our valued customers and consumers

Packing : The Filling and packing is considered to be most sensitive operation having

appropriate access control. Zoning principles are applied in these areas to avoid any cross

contaminations in our Finished Product. Online quality control checks (e.g. net weight,

leakages, seal integrity, batch coding, packing material quality, filling temperature etc.) are

carried out and recorded by our Packing In-charges. Only QC approved and released

Packaging materials are used for packing operations

Packaging material used for our products is with the objective of retaining taste, freshness

and unique natural appeal.

Product Testing & Release: Finished product is tested for the specified quality parameters

of each product category as per our internal standardized sampling plan and test procedure.

Test results are recorded, reviewed by Quality functions. It is ensured that only good quality

product is released for dispatch and reaches our valued customer & consumer.

Distribution : Our strength lies in adherence to systematic Process approach in the complete

distribution chain to deliver product with highest quality standards to our customers and

consumers. This includes,1. Availability of standard guidelines & norms for warehousing, handling, storage and

transportation requirements.

2. Benchmarking of Transportation vehicles for infrastructure and hygiene requirements

3. Benchmarking of CFA s andDistributors for infrastructure and hygiene requirements

4. Benchmarking of Milk Shops for infrastructure and hygiene requirement.

ADVERTSING:

As far as products such as butter, cheese and ice creams go, the campaigns have been created

Around "taste". For butter again, the focus is on children. "Amul butter may be selling the

most, but the advertising and promotions are almost always targeted at adults," points out an

analyst citing Amul's popular Utterly-Butterflycampaigns.

Here, Mother Dairy has dared to go different. Since 60 per cent butter is consumed by kids,

the company wants them to sit up and take notice of its butter. Makkhan Singh, a sturdy jovial cow (a cartoon character) has been made its brand ambassador. While Mother Dairy


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has been carrying out school programmes - games and activities involving Makkhan Singh

in Delhi, it has plans to take such activities to Mumbai and Kolkata as well. It also runs a

gaming website on the character to attract children. Equity and empathy are being built for

the brand, the values for which it stands, and the various other Mother Dairy products, which

draw their core values from Mother Dairy milk. It s cheese for children again. A couple of

months ago, Mother Dairy carried out a retail activity: Cheesekhao superhero ban jao",

where kids buying cheese at a retail outlet were invited for a photo - dressed as superheroes -

through Polaroid cameras; and the framed photograph was presented to them. The activity

was carried out in about 150 outlets in Delhi and Mumbai, with about 20,000-25,000 snaps

being taken.

.

Britannia : The story of one of India's favourite brands reads almost like a fairy tale. Once upon a time,

in 1892 to be precise, a biscuit company was started in a nondescript house in Calcutta (now

Kolkata) with an initial investment of Rs. 295. The company we all know as Britannia

today.Today, more than a century after those tentative first steps, Britannia's fairy tale is not

only going strong but blazing new standards, and that miniscule initial investment has grown

by leaps and bounds to cores of rupees in wealth for Britannia's shareholders. The company's

offerings are spread across the spectrum with products ranging from the healthy and

economical Tiger biscuits to the more lifestyle-oriented Milkman Cheese. Having succeeded


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Pricing:

The pricing strategy of Britannia is simple and the price as reasonable so that the consumer is

loyal to the product or even tries it.


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CHAPTER 5

CASE STUDY

Social Approach in Print Media Advertising: A Case Study of

Amul ButterBANG!!! And suddenly entire India is on its feet screaming about social evils, societal

malpractices and melodramatic incoherent situation that our country has been going through

since the day it earned independence. Naturally Indian media is ready to cash on these

circumstances by publishing only news material related to the social movement but also bycreating advertisements that reaches a broad section of consumerist society. In fact, an advert

with a social approach is one of the most engaging ways

To intricately involve a viewer to the product or service. Today s print and audio

Visual media is bombarded with advertisements that contain a social approach angle. These

advertise usually deals with a social message for individual development or to lend a voice to

a common cause. Social approach in advertising represents formats that engage the social

context of the user viewing the advertisement. These ads are exhibited to give the society of consumers a food for thought. The notion that drives these different brands is to let the

residents of India be conscious of some

Inevitable accountability list and to act upon it. For example: TATA Tea ad, Idea s Use

Mobile Save Tree ad, Aircel s Save Our Tigers ad and Amul Butter ads etc..

Amul butter ads portray a little girl in a polka dotted dress that had turned 50plus this year.

Like a true spokesperson of the masses, she rose to every occasion, be it a cricketing double

centur,scandals surrounding politicians, to controversial diplomatic policies, with an infalliblegut and a tongue-in-cheek attitude.The moppet was created in 1966 by cartoonist Eustace

Fernandes, who recently passed away. Amulhad approached his 'creative buddy' Sylvester

daCunha to design a new ad campaign for their butter brand. DaCunha, founder-Chairman of

DaCunha Communications and Fernandes created the very first hoarding that said: 'Give us

this day our daily bread with Amul Butter'. Since then, the Utterly, Butterly Girl has had her

say on current affairs topics and even today, continues to win hearts with her tongue-in-cheek

humour .People who are associated with it: Sylvester daCunha, Rahul daCunha, Manish

Jhaveri.


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AMUL BUTTER

AD CAMPS YEAR NATIONAL SCRENIO

1)Bhrashtaachar 1990 Alleged ties and shady financialtransaction between then primeminster narismaharao and a

pickle baron

2) Amul Lagaana uponevery slice of bread June,2001

The launch of the megahit movie

Lagaan

3)black mail chhodoyellow maalkhano

August ,2012 Sonia Gandhi, the president of theruling Congress party, that'blackmail is the political bread andbutter' of the oppositionBharatiyaJanata Party. It was a

reference to the BJP's demand thatPrime Minister Manmohan Singh

resign over a coal-mining scandal

4) Chak de..!! April ,2012 The controversial detention of actor shah rukh khan at Newark airport.one of his well knowsmovies (Chake de India )


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5) Clint Feast foods withObamul September,2012 Clint Eastwood's performance

speaking to achair at theRepublican National Convention intamba.

6) CoalmaalSeptember ,2012 Allegations of graft in India s

coal-mining sector as a nationalscandal erupt. 'Coalmaal is a

play on the Bollywood movie'Golmaal, about a band of youngcon-artist.

7)Every Particle s GodSent !Amul making mass-ka outof matter

July 2012The landmark research findingsabout a newsubatomic particle,the Higgs boson, or 'God particlein July.

8)Khan a, Hazare!Amullokpriyamakhan

December 2011 Hunger-fasting of anticorruptionactivist Anna Hazare.

9)Kolkartoon? 2012 april

West Bengal Chief Minister

Magmata Banerjee's anger over apolitical cartoon that mocked her.


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10)Hum kisiseKom Nain 2012 August India's MC Mary Kom won anOlympic bronze medal for boxing at

the London Games

1The prime minister is shown in a pickle jarand the headline is a play on the wordscorruption'

and 'pickle'

2 The headline's a pun: 'Lagaana" is a Hindi word that means 'Put'

So it reads, 'Put Amulupon every slice of bread.

3. In August, Mr. Da Cunha wanted to capitalize on a pun-worthy remark by Sonia Gandhi,

the president of the ruling Congress party, that 'blackmail is the political bread and butter' of

the opposition Bharatiya Janata Party. It was a reference to the BJP's demand that Prime

Minister Manmohan Singh resign over a coal-mining scandal. But he decided not to put MrsGandhi in this ad , fearful of a backlash from her supporters.

4. Amul s take on the controversial detention of actor Shah Rukh Khan at Newark airport.

One of his well-known movies (about women's field hockey) is called 'Chak De! India.

5. Amul s parody of Clint Eastwood's performance speaking to a chair at the Republican

National Convention in Tampa earlier this month.

6. Amul tackles allegations of graft in India's coal-mining sector as a national scandal erupts.

Coalmaal' is a play on the Bollywood movie 'Golmaal,' about a band of young con-artists.

7.This Amul ad celebrated the landmark research findings about a new subatomic particle,

the Higgs boson, or 'God particle,' in July.


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8. In this Amul ad from December 2011, the little girl offers a slice of buttery bread to

hunger-fasting anticorruption activist Anna Hazare. 'Khana' (a pun on his name) means 'Eat

this.

9. Amul s send up of West Bengal Chief Minister Mamata Banerjee's anger over a political

cartoon that mocked her. The Amul ad didn't appear in Kolkata, Ms Banerjees home state,

because adman Rahul daCunha was fearful of a backlash against the Amul brand there.

10. India s MC Mary Kom won an Olympic bronze medal for boxing at the London Games.

The celebratory headline is a pun on her name and a Hindi phrase meaning 'We're not less

than anybody .'Consumer product brands starts projecting current events in their advertises

then it paves way for further awakening. Such advertise is always a reflection of and a

response to the change taking place in socio-cultural milieu. This is where Amul Butter ads

enter the scene. For more than half a century, advertisements for the brand

Amul

Have stuck the knife into politicians, sports stars and other celebrities for all manners of

blunders and scams and celebrated national heroes and achievement.


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CHAPTER 6LIMITATIONS

Environmental regulations

Oversupply of raw milk

Lack of increased processing capacity and innovation

High environmental mitigation costs

Low investment in successful promotion, marketing, and product innovation except for Amul

Legal and regulatory reforms need to be introduced in many remote areas

CHAPTER 7

SUGGESTIONS:

India is the world's highest milk producer and all set to become the world's largest foodfactory. In celebration, Indian Dairy sector is now ready to invite NRIs and Foreign

investors to find this country a place for the mammoth investment projects. Be it

investors, researchers, entrepreneurs, or the merely curious Indian Dairy sector has

something for everyone.

Milk production is relatively efficient way of converting vegetable material into animal

food. Dairy cows buffaloes goats and sheep can eat fodder and crop by products which

are not eaten by humans. Yet the loss of nutrients energy and equipment required in milk handling inevitably make milk comparatively expensive food. Also if dairying is to play

its part in rural development policies , the price to milk producers has to be remunerative.

In a situation of increased international prices, low availabilities of food aid and foreign

exchange constraints, large scale subsidization of milk conception will be difficult in the

majority of developing countries.

Hence in the foreseeable future, in most of developing countries milk and milk products

will not play the same roll in nutrition as in the affluent societies of developed countries.


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BIBLOGRAPHY

http://www.livestrong.com/article/539259-the-disadvantages-of-dairy/#ixzz2fyxA4XJi

http://www.businessdictionary.com/definition/strategy.html#ixzz2fWNILmQP

http://www.livestrong.com/article/539259-the-disadvantages-of-dairy/#ixzz2fywadCdc

http://www.google.co.in/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&ved=0CDYQFjAB&url=http%3A%2F%2Fwww.iitk.ac.in%2Finfocell%2Fannounce%2Fconvention%2Fpaper s%2FChanging%2520Playfield-02-Rajeev%2520Ranjan%2C%2520Rahul%2520Bangabash.pdf&ei=qGBBUpGNIIaGiQeCt4HAAw&usg=AFQjCNHcfLhyoyBYU0jWRTdptpx8h6DthA&sig2=0pih2wSHV1ipxRJ-4cIMeQ&bvm=bv.52434380,d
http://www.livestrong.com/article/539259-the-disadvantages-of-dairy/#ixzz2fyxA4XJihttp://www.livestrong.com/article/539259-the-disadvantages-of-dairy/#ixzz2fyxA4XJihttp://www.businessdictionary.com/definition/strategy.html#ixzz2fWNILmQPhttp://www.businessdictionary.com/definition/strategy.html#ixzz2fWNILmQPhttp://www.livestrong.com/article/539259-the-disadvantages-of-dairy/#ixzz2fywadCdchttp://www.livestrong.com/article/539259-the-disadvantages-of-dairy/#ixzz2fywadCdchttp://www.livestrong.com/article/539259-the-disadvantages-of-dairy/#ixzz2fywadCdchttp://www.businessdictionary.com/definition/strategy.html#ixzz2fWNILmQPhttp://www.livestrong.com/article/539259-the-disadvantages-of-dairy/#ixzz2fyxA4XJi

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