PROJECT REPORT

“To increase ITC’s foothold on rural markets using lower population group

strategy and execution.”

ITC INDIA PVT LTD

SUBMITTED IN PARTIAL FULFILLMENT FOR THE AWARD OF DEGREE OF MASTERS

OF BUSINESS ADMINISTRATION

By

ARJIT GARG

10-MBA-10

THE BUSINESS SCHOOL

UNIVERSITY OF JAMMU, JAMMU

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EXECUTIVE SUMMARY

The project I was entitled to basically deal with increase the presence of ITC in rural

market which holds 80% of Indian population and area as of now. Most of the rural

market in India is untouched because of lack of infrastructure for transportation and

other necessary things.

ITC decided to increase its foothold in rural market through its 23 main marketing

branches across India. Saharanpur (U.P) is one of the prominent branches in north

India because Saharanpur division is also the manufacturer of its tobacco which was

the basic product of ITC few years back. But soon ITC decided to enter into other

goods like- FMCG, glossary products and personal care products.

With its market share of 78% across India in tobacco division, ITC utilized this

channel to promote its food products and personal care products so that they can

reach farthest of the places. But to enter rural market one has to deal with various

aspects like – right pricing, right taste, right size and right packing.

Still in its introduction stage, the idea of reaching masses can be a huge success if

implemented perfectly.

I in support with my Mentor Mr. Shiv Kapoor ( Area executive, ITC Saharanpur

division) worked hard on finding out new ways to reach deepest of interiors in

villages where reaching otherwise is tough. My project is based on the same.

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ACKNOWLEDGEMENT

I take immense pleasure in expressing my gratitude to ITC INDIA PVT LTD for

giving me an opportunity to do summer internship with them. Working with them was

a great learning experience. The Summer Project on “To increase foothold on

rural markets using lower population group strategy and execution” offered a

great learning experience. During the tenure of this project, I was fortunate to have

interacted with people, who in their own capacities have encouraged and guided me.

I would also like to express my sincere gratitude to Mr. Shiv Kapoor my project

guide who has been instrumental in my progress from the very beginning of my

internship. I was privileged to experience a sustained enthusiastic and involved

interest from his side I thank him for guiding my judgment, constantly pushing the

upper limits of my capabilities, encouraging me to deliver more.

I would like to express my sincere gratitude to Marketing Department for providing

me an opportunity to undergo summer internship.

I take this opportunity to thank MR. Karan Sehgal(ABM, ITC Saharanpur Division)

who had been a source of inspiration and for his timely guidance in the conduct of

my project work.

I would like to thank The Business School, University of Jammu for providing me

the necessary knowledge, because of which I was able to complete my project

without much difficulty.

ARJIT GARG

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DECLARATION

I, ARJIT GARG student of THE BUSINESS SCHOOL, UNIVERSITY OF JAMMU

pursuing M.B.A course hereby declare that the project work entitled “To increase

foothold on rural markets using lower population group strategy and execution” is an

original work carried out by me, availing the guidance of my project guide. This

report bears no resemblance with any other report submitted to University of Jammu

or any other University for the award of any degree.

Place: Jammu

Date: 10-08-2011 ARJIT GARG

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CONTENTS

Page No.

About Company History 07 Profile 11 Products 17

Facts worth knowing 37

Terms used 38

Objective 40

Distribution Channel 41

Modus Operandi 43

Rural marketing Challenges 50 Classification 56

Research Methodology 60

Modes of Market reaching 68

Comparative Analysis Cost 73 Results 74

Recruitment 75

Limitation 78

Recommendations 79

Conclusion 80

Bibliography 81

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PART- 1

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HISTORY AND EVOLUTION

ITC was incorporated on August 24, 1910 under the name Imperial Tobacco Company of India Limited. As the Company's ownership progressively Indianized, the name of the Company was changed from Imperial Tobacco Company of India Limited to India Tobacco Company Limited in 1970 and then to I.T.C. Limited in 1974. In recognition of the Company's multi-business portfolio encompassing a wide range of businesses - Cigarettes & Tobacco, Hotels, Information Technology, Packaging, Paperboards & Specialty Papers, Agri-business, Foods, Lifestyle Retailing, Education & Stationery and Personal Care - the full stops in the Company's name were removed effective September 18, 2001. The Company now stands rechristened 'ITC Limited'.

The Company’s beginnings were humble. A leased office on Radha Bazar Lane, Kolkata, was the centre of the Company's existence. The Company celebrated its 16th birthday on August 24, 1926, by purchasing the plot of land situated at 37, Chowringhee, (now renamed J.L. Nehru Road) Kolkata, for the sum of Rs 310,000. This decision of the Company was historic in more ways than one. It was to mark the beginning of a long and eventful journey into India's future. The Company's headquarter building, 'Virginia House', which came up on that plot of land two years later, would go on to become one of Kolkata's most venerated landmarks.

Though the first six decades of the Company's existence were primarily devoted to the growth and consolidation of the Cigarettes and Leaf Tobacco businesses, the Seventies witnessed the beginnings of a corporate transformation that would usher in momentous changes in the life of the Company.

ITC's Packaging & Printing Business was set up in 1925 as a strategic backward integration for ITC's Cigarettes business. It is today India's most sophisticated packaging house.

In 1975 the Company launched its Hotels business with the acquisition of a hotel in Chennai which was rechristened 'ITC-Welcomgroup Hotel Chola'. The objective of ITC's entry into the hotels business was rooted in the concept of creating value for the nation. ITC chose the hotels business for its potential to earn high levels of foreign exchange, create tourism infrastructure and generate large scale direct and indirect employment. Since then ITC's Hotels business has grown to occupy a position of leadership, with over 100 owned and managed properties spread across India.

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In 1979, ITC entered the Paperboards business by promoting ITC Bhadrachalam Paperboards Limited, which today has become the market leader in India. Bhadrachalam Paperboards amalgamated with the Company effective March 13, 2002 and became a Division of the Company, Bhadrachalam Paperboards Division. In November 2002, this division merged with the Company's Tribeni Tissues Division to form the Paperboards & Specialty Papers Division. ITC's paperboards' technology, productivity, quality and manufacturing processes are comparable to the best in the world. It has also made an immense contribution to the development of Sarapaka, an economically backward area in the state of Andhra Pradesh. It is directly involved in education, environmental protection and community development. In 2004, ITC acquired the paperboard manufacturing facility of BILT Industrial Packaging Co. Ltd (BIPCO), near Coimbatore, Tamil Nadu. The Kovai Unit allows ITC to improve customer service with reduced lead time and a wider product range.

In 1985, ITC set up Surya Tobacco Co. in Nepal as an Indo-Nepal and British joint venture. Since inception, its shares have been held by ITC, British American Tobacco and various independent shareholders in Nepal. In August 2002, Surya Tobacco became a subsidiary of ITC Limited and its name was changed to Surya Nepal Private Limited (Surya Nepal).

In 1990, ITC acquired Tribeni Tissues Limited, a Specialty paper manufacturing company and a major supplier of tissue paper to the cigarette industry. The merged entity was named the Tribeni Tissues Division (TTD). To harness strategic and operational synergies, TTD was merged with the Bhadrachalam Paperboards Division to form the Paperboards & Specialty Papers Division in November 2002.

Also in 1990, leveraging its agri-sourcing competency, ITC set up the Agri Business Division for export of agri-commodities. The Division is today one of India's largest exporters. ITC's unique and now widely acknowledged e-Choupal initiative began in 2000 with soya farmers in Madhya Pradesh. Now it extends to 10 states covering over 4 million farmers. ITC's first rural mall, christened 'Choupal Saagar' was inaugurated in August 2004 at Sehore. On the rural retail front, 24 'Choupal Saagars' are now operational in the 3 states of Madhya Pradesh, Maharashtra and Uttar Pradesh.

In 2000, ITC forayed into the Greeting, Gifting and Stationery products business with the launch of Expressions range of greeting cards. A line of premium range of notebooks under brand “Paperkraft” was launched in 2002. To augment its offering and to reach a wider student population, the popular range of notebooks was launched under brand “Classmate” in 2003. 

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“Classmate” over the years has grown to become India’s largest notebook brand and has also increased its portfolio to occupy a greater share of the school bag. Years 2007- 2009 saw the launch of Children Books, Slam Books, Geometry Boxes, Pens and Pencils under the “Classmate” brand. In 2008, ITC repositioned the business as the Education and Stationery Products Business and launched India's first environment friendly premium business paper under the “Paperkraft” Brand. “Paperkraft” offers a diverse portfolio in the premium executive stationery and office consumables segment. Paperkraft entered new categories in the office consumable segment with the launch of Text liners, Permanent Ink Markers and White Board Markers in 2009.

ITC also entered the Lifestyle Retailing business with the Wills Sport range of international quality relaxed wear for men and women in 2000. The Wills Lifestyle chain of exclusive stores later expanded its range to include Wills Classic formal wear (2002) and Wills Club life evening wear (2003). ITC also initiated a foray into the popular segment with its men's wear brand, John Players, in 2002. In 2006, Wills Lifestyle became title partner of the country's most premier fashion event - Wills Lifestyle India Fashion Week - that has gained recognition from buyers and retailers as the single largest B-2-B platform for the Fashion Design industry. To mark the occasion, ITC launched a special 'Celebration Series', taking the event forward to consumers.

In 2000, ITC spun off its information technology business into a wholly owned subsidiary, ITC Infotech India Limited, to more aggressively pursue emerging opportunities in this area. Today ITC Infotech is one of India’s fastest growing global IT and IT-enabled services companies and has established itself as a key player in offshore outsourcing, providing outsourced IT solutions and services to leading global customers across key focus verticals - Manufacturing, BFSI (Banking, Financial Services & Insurance), CPG&R (Consumer Packaged Goods & Retail), THT (Travel, Hospitality and Transportation) and Media & Entertainment.

ITC's foray into the Foods business is an outstanding example of successfully blending multiple internal competencies to create a new driver of business growth. It began in August 2001 with the introduction of 'Kitchens of India' ready-to-eat Indian gourmet dishes. In 2002, ITC entered the confectionery and staples segments with the launch of the brands mint-o and Candyman confectionery and Aashirvaad atta (wheat flour). 2003 witnessed the introduction of Sunfeast as the Company entered the biscuits segment. ITC's entered the fast growing branded snacks category with Bingo! in 2007.

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In eight years, the Foods business has grown to a significant size with over 200 differentiated products under six distinctive brands, with an enviable distribution reach, a rapidly growing market share and a solid market standing.

In 2002, ITC's philosophy of contributing to enhancing the competitiveness of the entire value chain found yet another expression in the Safety Matches initiative. ITC now markets popular safety matches brands like iKno, Mangaldeep, Aim, Aim Mega and Aim Metro.

ITC's foray into the marketing of Agarbattis (incense sticks) in 2003 marked the manifestation of its partnership with the cottage sector. ITC's popular agarbattis brands include Spriha and Mangaldeep across a range of fragrances like Rose, Jasmine, Bouquet, Sandalwood, Madhur, Sambrani and Nagchampa.

ITC introduced Essenza Di Wills, an exclusive range of fine fragrances and bath &

body care products for men and women in July 2005. Inizio, the signature range

under Essenza Di Wills provides a comprehensive grooming regimen with distinct

lines for men (Inizio Homme) and women (Inizio Femme). Continuing with its

tradition of bringing world class products to Indian consumers the Company

launched 'Fiama Di Wills', a premium range of Shampoos, Shower Gels and Soaps

in September, October and December 2007 respectively. The Company also

launched the 'Superia' range of Soaps and Shampoos in the mass-market segment

at select markets in October 2007 and Vivel De Wills & Vivel range of soaps in

February and Vivel range of shampoos in June 2008.

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THE ITC PROFILE

ITC is one of India's foremost private sector companies with a market capitalization of over US $ 30 billion and a turnover of US $ 6 billion. ITC is rated among the World's Best Big Companies, Asia's 'Fab 50' and the World's Most Reputable Companies by Forbes magazine, among India's Most Respected Companies by Business World and among India's Most Valuable Companies by Business Today. ITC ranks among India's `10 Most Valuable (Company) Brands', in a study conducted by Brand Finance and published by the Economic Times. ITC also ranks among Asia's 50 best performing companies compiled by Business Week.

ITC has a diversified presence in Cigarettes, Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business, Packaged Foods & Confectionery, Information Technology, Branded Apparel, Personal Care, Stationery, Safety Matches and other FMCG products. While ITC is an outstanding market leader in its traditional businesses of Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports, it is rapidly gaining market share even in its nascent businesses of Packaged Foods & Confectionery, Branded Apparel, Personal Care and Stationery.

As one of India's most valuable and respected corporations, ITC is widely perceived to be dedicatedly nation-oriented. Chairman Y C Deveshwar calls this source of inspiration "a commitment beyond the market". In his own words: "ITC believes that its aspiration to create enduring value for the nation provides the motive force to sustain growing shareholder value. ITC practices this philosophy by not only driving each of its businesses towards international competitiveness but by also consciously contributing to enhancing the competitiveness of the larger value chain of which it is a part."

ITC's diversified status originates from its corporate strategy aimed at creating multiple drivers of growth anchored on its time-tested core competencies: unmatched distribution reach, superior brand-building capabilities, effective supply chain management and acknowledged service skills in hoteliering. Over time, the strategic forays into new businesses are expected to garner a significant share of these emerging high-growth markets in India.

ITC's Agri-Business is one of India's largest exporters of agricultural products. ITC is one of the country's biggest foreign exchange earners (US $ 3.2 billion in the last decade). The Company's 'e-Choupal' initiative is enabling Indian agriculture significantly enhance its competitiveness by empowering Indian farmers through the power of the Internet.

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This transformational strategy, which has already become the subject matter of a case study at Harvard Business School, is expected to progressively create for ITC a huge rural distribution infrastructure, significantly enhancing the Company's marketing reach.

ITC's wholly owned Information Technology subsidiary, ITC Infotech India Ltd, provides IT services and solutions to leading global customers. ITC Infotech has carved a niche for itself by addressing customer challenges through innovative IT solutions.

ITC's production facilities and hotels have won numerous national and international awards for quality, productivity, safety and environment management systems. ITC was the first company in India to voluntarily seek a corporate governance rating.

ITC employs over 26,000 people at more than 60 locations across India. The Company continuously endeavors to enhance its wealth generating capabilities in a globalizing environment to consistently reward more than 4,07,000 shareholders, fulfill the aspirations of its stakeholders and meet societal expectations. This over-arching vision of the company is expressively captured in its corporate positioning statement: "Enduring Value. For the Nation. For the Shareholder."

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Mr. Y.C. Deveswar addressing the 99 th annual board meeting.

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BOARD OF DIRECTORS

CHAIRMAN

Y C Deveshwar

EXECUTIVE DIRECTORS

NakulAnand P V Dhobale K N Grant

NON-EXECUTIVE DIRECTORS

A Baijal S Banerjee AV Girija Kumar

S H Khan S B Mathur D K Mehrotra

H G Powell P B Ramanujam Anthony Ruys

BasudebSen K Vaidyanath B Vijayaraghavan

Y C D E V E S H W A R

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Y C Deveshwar (64), an engineering graduate from the Indian Institute of Technology, Delhi joined ITC Limited in 1968. He was appointed as a Director on the Board of the Company in 1984 and became the Chief Executive and Chairman of the Board on January 1, 1996. He is also the Chairman of ITC’s wholly owned subsidiary, ITC Infotech India Limited, and its subsidiaries in the UK and USA. Between 1991 and 1994, he led Air India as Chairman and Managing Director.

Under his leadership, ITC’s Sustainability efforts were given shape through unique business models. ITC became the first Indian company to publish its Sustainability Report, 2004 in accordance with the guidelines of the Global Reporting Initiative. For the efforts at creating sustainable livelihood opportunities, ITC also won the inaugural World Business Award instituted jointly by the United Nations Development Program (UNDP), International Chamber of Commerce (ICC) and the HRH Prince of Wales International Business Leader's Forum (IBLF). ITC’s ‘e-Choupal’, a digital infrastructure initiative to empower marginal farmers in India, is taught as a case study at the Harvard Business School. This initiative won the Development Gateway award at Beijing in September 2005 and the Stockholm Challenge Award in May 2006.

Deveshwar is the Past President of the Confederation of Indian Industry. He is also a member of the Board of Governors of the Indian School of Business and the former Chairman of the Society and Board of Governors of the Indian Institute of Management, Calcutta. He also serves on the National Executive Committees of some of India’s premier trade and industry bodies.

In 2011, Deveshwar was conferred the Padma Bhushan, one of the highest civilian awards in the country, by the Government of India in recognition of his distinguished service of a high order to the Nation. Amongst several other awards and recognition during his distinguished career, Deveshwar has been honored with the Global Leadership Award 2010 by the U.S.- India Business Council of the US Chamber of Commerce, the SAM/SPG Sustainability Leadership Award 2007 conferred at the International Sustainability Leadership Symposium, the Business Person of the Year Award 2006 by the UK Trade & Investment by His Royal Highness Prince Andrew, the Duke of York. In January 2006, he was inducted to the prestigious Hall of Pride at the Indian Science Congress. He was also named the Manager Entrepreneur of the Year 2001 by Ernst & Young.

BRANDS

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PRODUCT CATEGORIES

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FMCG

It is ITC's strategic intent to secure long-term growth by synergizing and blending the diverse pool of competencies residing in its various businesses to exploit emerging opportunities in the FMCG sector.

The Company’s institutional strengths – deep understanding of the Indian consumer, strong trademarks, deep and wide distribution network, agri-sourcing skills, packaging know-how and cuisine expertise – continue to be effectively leveraged to rapidly grow the new FMCG businesses.

Over the last few years, ITC has rapidly scaled up presence in its newer FMCG businesses comprising Branded Packaged Foods, Lifestyle Retailing, Education and Stationery products, Personal Care products, Safety Matches and Incense Sticks (Agarbatti) with Segment Revenues growing at an impressive compound annual growth rate of 38% during the last 5 years.

The Company’s unwavering focus on quality, innovation and differentiation backed by deep consumer insights, world-class R&D and an efficient and responsive supply chain will further strengthen its leadership position in the Indian FMCG industry.

ITC has developed a scheme under which they have decided to sell their FMCG products with the cigarette salesman. This is called the Convenience channel. Convenience because all the goods can be sold easily through local pan shops in any of the market either rural or urban.

The sales of other channels like glossary or personal care product is otherwise very slow. But we know cigarettes move like water so it is beneficial to sell other slow selling items with cigarettes route. This way we can make sure that these products have visibility all around the corner. This scheme has proved to be very successful in rural market on which my project is based. On further studies ahead we will see how these items are moved with cigarettes working as a catalyst.

ITC’s FMCG portfolio comprises:

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Foods

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ITC made its entry into the branded & packaged Foods business in August 2001 with the launch of the Kitchens of India brand. A more broad-based entry has been made since June 2002 with brand launches in the Confectionery, Staples and Snack Foods segments.

The packaged foods business is an ideal avenue to leverage ITC's proven strengths in the areas of hospitality and branded cuisine, contemporary packaging and sourcing of agricultural commodities. ITC's world famous restaurants like the Bukhara and the Dum Pukht, nurtured by the Company's Hotels business, demonstrate that ITC has a deep understanding of the Indian palate and the expertise required to translate this knowledge into delightful dining experiences for the consumer. ITC has stood for quality products for over 100 years to the Indian consumer and several of its brands are today internationally benchmarked for quality.

The Foods business carries forward this proud tradition to deliver quality food products to the consumer. All products of ITC's Foods business available in the market today have been crafted based on consumer insights developed through extensive market research. Apart from the current portfolio of products, several new and innovative products are under development in ITC's state-of-the-art Product Development facility located at Bengaluru.

Leadership in the Foods business requires a keen understanding of the supply chain for agricultural produce. ITC has over the last 100 years established a very close business relationship with the farming community in India and is currently in the process of enhancing the Indian farmer's ability to link to global markets, through the e-Choupal initiative, and produce the quality demanded by its customers. This long-standing relationship is being leveraged in sourcing best quality agricultural produce for ITC's Foods business.

The Foods business is today represented in 4 categories in the market. These are:

Ready To Eat Foods

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Staples

Confectionery

Snack Foods

In order to assure consumers of the highest standards of food safety and hygiene, ITC is engaged in assisting outsourced manufacturers in implementing world-class hygiene standards through HACCP certification. The unwavering commitment to internationally benchmarked quality standards enabled ITC to rapidly gain market standing in all its 6 brands:

 

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Agarbattis

As part of ITC's business strategy of creating multiple drivers of growth in the FMCG sector, the Company commenced marketing Agarbattis (Incense Sticks) sourced from small-scale and cottage units in 2003. This Business leverages the core strengths of ITC in nation-wide distribution and marketing, brand building, supply chain management, manufacture of high quality paperboards and the creation of innovative packaging solutions to offer Indian consumers high quality Agarbattis. With its participation in the business, ITC aims to enhance the competitiveness of the small and medium scale sectors through its complementary R&D based product development and strengths in trade marketing and distribution.

Mangaldeep Agarbattis are available in a wide range of fragrances like Rose, Jasmine, Bouquet, Sandalwood, Madhur, Durbar, Tarangini, Anushri, Ananth and Mogra.

Durbar Gold is a new offering from Mangaldeep launched in Andhra Pradesh and has received wide consumer acceptance. The premium range from ITC, Mangaldeep Spriha has two offerings, Pratiti and Sarvatra and are specially hand rolled by Cottage Industries, Sri Aurobindo Ashram, Puducherry.

Cottage Industries, Puducherry, has been accredited with IFAT certification, which is an internationally recognized benchmark for fair trade practices.

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Mangaldeep is also available in 3-in-1 and 5-in-1 packs giving the consumer a choice of multiple fragrances in a single pack. Mangaldeep appeals to a cross-section of consumers with offerings at various price points. These agarbattis are available in innovative 'Fragrance-Locked' packaging. 'Fragrance locking' is a unique concept of packaging which retains the fragrance for a longer period and helps in "Completing the Purity of Prayer". Mangaldeep

is fast emerging as the only national brand in an industry dominated by multiple local brands.

Mangaldeep Dhoop, made with Natural Ingredients, is available in specific markets and is fast emerging as a key player in North India.

Recently, Mangaldeep launched the Premium range of Sarvatra Flora agarbattis. Sarvatra flora agarbattis are a wet type of agarbattis, different from the normal agarbattis. These agarbattis have a natural base, are brownish in colour and offer a wholesome and differentiated fragrance experience to the consumer. Sarvatra Flora Agarbattis are now available in select markets.

The Business is currently working on various exciting new offerings to the consumers and is planning to launch them in the near future.

 

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Cigarettes

ITC is the market leader in cigarettes in India. With its wide range of invaluable brands, it has a leadership position in every segment of the market. It's highly popular portfolio of brands includes Insignia, India Kings, Lucky Strike, Classic, Gold Flake, Navy Cut, Players, Scissors, Capstan, Berkeley, Bristol and Flake, Silk Cut and Duke.

The Company has been able to build on its leadership position because of its single minded focus on value creation for the consumer through significant investments in product design, innovation, manufacturing technology, quality, marketing and distribution.

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All initiatives are therefore worked upon with the intent to fortify market standing in the long term. This in turns aids in designing products which are contemporary and relevant to the changing attitudes and evolving socio economic profile of the country. This strategic focus on the consumer has paid ITC handsome dividends.

ITC's pursuit of international competitiveness is reflected in its initiatives in the overseas markets. In the extremely competitive US market, ITC offers high-quality, value-priced cigarettes and Roll-your-own solutions. In West Asia, ITC has become a key player in the GCC markets through growing volumes of its brands.

ITC's cigarettes are produced in its state-of-the-art factories at Bengaluru, Munger, Saharanpur, Kolkata and Pune. These factories are known for their high levels of quality, contemporary technology and work environment.

Awards

ITC's Cigarettes business has been winning numerous awards for its quality, environmental management systems and product excellence:

'Best Manufacturer of Cigarettes' for the year 2008 & 2007 and Best Exporter of Cigarettes for 2008 by the Tobacco Board based on previous three years' performance.

Occupational Health and Safety Award 2007 for Excellence in Safety Management to the Bengaluru, Saharanpur and Kolkata factories from the Royal Society for Prevention of Accidents (ROSPA), U.K.

5 Star Health and Safety Rating in 2007 from the British Safety Council to the Bengaluru, Munger, Kolkata and Saharanpur factories and the "Sword of Honour" for Bengaluru & Saharanpur factories in 2006.

Greentech Gold Award for excellence in Safety Management for the year 2007 to the Bengaluru, Kolkata and Saharanpur cigarette factories for the high level of performance that the units have achieved in Environment Health and Safety (EHS). Saharanpur along with Kolkata and Munger factories were honored with the Gold award and the Bengaluru Factory with the Platinum Award in 2006.

Greentech Gold Award for Excellence in Environment Management 2007 to the Bengaluru, Kolkata and Munger factories.

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Safety Innovation Award for 2007 and 2006 for Innovative Safety Management System to the Bengaluru Factory from the Institution of Engineers and also the Unnatha Suraksha Puraskara Award 2006 from NSC Karnataka Chapter.

Golden Peacock Award for Occupational Health and Safety from the Institute of Directors, New Delhi; Award for Outstanding Performance in Environment Health and Safety from the CII and the Suraksha Puraskar Award from the National Safety Council, Mumbai to the Kolkata factory in 2007 and the "1st National Security Today Award" in the category of Best Maintained Fire Safety System in 2005.

Occupational Health and Safety Gold Award from the ROSPA, UK; the Winners Trophy - Safety Health and Environment Award from the CII Eastern region; National Award for Excellence in Water Management and Innovative Project Award Initiatives for Energy Conservation from the CII to the Munger factory in 2007 and also the Excellence in Water Management Award fromCII-GBC for 2006.

All the four factories are certified by Det Norske Veritas (DNV) for ISO 14001, for their Environment Management Systems, OHSAS 18001 for their Occupational Health and Safety Management Systems (OHSMS) and the ISO 9000-2000 for Quality Management Systems. The Kolkata factory is the first cigarette factory in India to be awarded the SA 8000 Certificate for Social Accountability by Det Norske Veritas (DNV) in June 2004. 

ITC's R&D Centre at Peenya, Bengaluru has the distinction of being the first independent R&D centre in India to get ISO 9001 accreditation and certified with ISO 14001 for Environment Management Systems by DNV. The R&D Centre is also certified for the standard ISO/IEC17025:2005, by National Accreditation Board for Testing and Calibration Laboratories (NABL). This certification is awarded for "General requirement for the competence of Testing & Calibration Laboratories"

 

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Lifestyle Retailing

ITC's Lifestyle Retailing Business Division has established a nationwide retailing presence through its Wills Lifestyle chain of exclusive specialty stores. Wills Lifestyle, the fashion destination, offers a tempting choice of Wills Classic work wear, Wills Sport relaxed wear, Wills Clublife evening wear, fashion accessories and Essenza Di Wills - an exclusive range of fine fragrances and bath & body care products and Fiama Di Wills - a range of premium shampoos and shower gels. Wills Lifestyle has also introduced Wills Signature designer wear, designed by the leading designers of the country.

With a distinctive presence across segments at the premium end, ITC has also established John Players as a brand that offers a complete fashion wardrobe to the male youth of today. With its brands, ITC is committed to build a dominant presence in the apparel market through a robust portfolio of offerings.

 

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Safety Matches

As part of its strategic initiative to create multiple drivers of growth in the FMCG sector, ITC commenced marketing safety matches sourced from the small-scale sector. The Matches business leverages the core strengths of ITC in marketing and distribution, brand building, supply chain management and paperboard & packaging to offer Indian consumers high quality safety matches.

ITC's range of Safety matches include popular brands like i Kno, Mangaldeep, Stylites, Aim and Aim Mega. With differentiated product features and innovative value additions, these brands effectively address the needs of different consumer segments. Aim is the largest selling brand of Safety Matches in India. ITC also exports regular and premium safety matches brands to markets such as Middle East, Africa and the USA. The successful acquisition of Wimco Ltd. by Russell Credit Ltd., a wholly owned subsidiary of ITC has consolidated the market standing of the Company's Matches business through synergy benefits derived through combined portfolio of offerings, improved servicing of proximal markets and freight optimization. Through its participation, ITC aims to enhance the competitiveness of the small and medium scale sectors through its complementary R&D based product development and marketing strengths, especially the breadth and depth of the Company's trade marketing and distribution.

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Personal Care

In line with ITC's aspiration to be India's premier FMCG company, recognized for its world-class quality and enduring consumer trust, ITC forayed into the Personal Care business in July 2005. In the short period since its entry, ITC has already launched an array of brands, each of which offers a unique and superior value proposition to discerning consumers. Anchored on extensive consumer research and product development, ITC's personal care portfolio brings world-class products with clearly differentiated benefits to quality-seeking consumers.

ITC's Personal Care portfolio under the 'Essenza Di Wills', 'Fiama Di Wills', 'Vivel Di Wills' 'VivelUltraPro', 'Vivel' and 'Superia' brands has received encouraging consumer response and is being progressively extended nationally.

ITC's state-of-the-art manufacturing facility meets stringent requirements of hygiene and benchmarked manufacturing practices. Contemporary technology and the latest manufacturing processes have combined to produce distinctly superior products which rank high on quality and consumer appeal.

Extensive insights gained by ITC through its numerous consumer engagements have provided the platform for its R&D and Product Development teams to develop superior, differentiated products that meet the consumer's stated and innate needs. The product formulations use internationally recognized safe ingredients, subjected to the highest standards of safety and performance.

 

 

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Education and Stationery

ITC made its entry to the education and stationery business with its Paperkraft brand in the premium segment in 2002; and later expanded into the popular segment with its Classmate brand in 2003. By 2007, Classmate became the largest Notebook brand in the country. Together, Classmate and Paperkraft offer a range of products in the Education & Stationery space to the discerning consumer, providing unrivalled value in terms of product & price.

Classmate and Paperkraft have become a natural extension of the consumer. Meticulous understanding of consumer needs helped creating a relevant and comprehensive portfolio satisfying the needs of different sets of consumers.

ITC is the manufacturer of India's first Ozone treated environment friendly Elemental Chlorine Free (ECF) pulp, paper and paperboard. It blends its knowledge of image processing, printing and conversion garnered from Packaging & Printing Business with its brand building and trade marketing & distribution strengths resident in its FMCG business to offer superior value products to consumers.

Paperkraft Business paper and the papers used in Classmate and Paperkraft notebooks are superior in quality and environment-friendly. Other offerings available in education and Stationery range are safe and certified non-toxic.

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Hotels

ITC Hotels, India's premier chain of luxury hotels was launched on October 18, 1975, with the opening of its first hotel - Chola Sheraton in Chennai. Since then the ITC Hotels brand has become synonymous with Indian hospitality. With over 100 hotels in more than 90 destinations, ITC Hotels has set new standards of excellence in the hotel industry in Accommodation, Cuisine, Environment and Guest Safety.A leader in the premium hospitality segment, ITC Hotels have had the privilege of hosting world leaders, Heads of State and discerning guests from across the world and within.As one of India's most dynamic hospitality chains, ITC Hotels has set standards for excellence in the hotel industry by pioneering the concept of branded accommodation. The chain has developed three brands of accommodation ITC One', 'Towers' and the 'Executive Club' to differentiate between the needs of various travelers and provide high levels of service.First to introduce branded cuisine, its restaurants Bukhara, Dakshin and DumPukht are renowned for their delicious and authentic Indian cuisines from the different regions of India. ITC Hotels also showcases international cuisine in its specialty restaurants West View and Pan Asian.ITC Hotels has strategically customized its hotels and appropriately categorized them to fulfill the service and budgetary needs of travelers. With its exclusive strategic tie up with Starwood for its top of the line premium brand the 'Luxury Collection', the group is strengthening its international marketing stance. ITC Hotels was also instrumental in bringing the 'Sheraton' brand to India, with which it enjoyed a three-decade exclusive partnership.

 

In 2007, ITC Hotels entered a new phase in its collaboration with Starwood Hotels & Resorts. ITC Hotels now has an exclusive tie-up with Starwood in bringing its premium brand, the 'Luxury Collection', to India. These are super deluxe and premium hotels located at strategic business and leisure locations. The seven hotels which are part of this collection are: ITC Maurya in Delhi, ITC Maratha in Mumbai, ITC Sonar in Kolkata, ITC Grand Central in Mumbai, ITC Windsor & ITC Gardenia in Bengaluru, ITC Kakatiya in Hyderabad and ITC Mughal in Agra.

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Welcome Hotels offer five-star hospitality for the discerning business and leisure traveler. Currently there are three hotels under this brand namely, Welcom Hotel Rama International Aurangabad, WelcomHotel Vadodara and WelcomHotel Grand BayVishakhapatnam. Four other ITC Hotels Sheraton Hotels – Sheraton Rajputana Hotel Jaipur, Sheraton Chola Hotel Chennai, Sheraton Park Hotel and Towers, Chennai and Sheraton New Delhi offer warm, comforting services to the global traveler and a chance to connect. 

Fortune Hotels operates mid-market to upscale properties in the first-class, full-service business hotel segment all over India, in major metros, mini metros, state capitals and business towns, promising business and leisure travelers a wide choice of destinations and accommodation. Fortune Hotels currently has hotels operating in Ahmedabad, Chennai, Gurgaon, Indore, Jaipur, Jammu, Jamshedpur, Kolkata, Ludhiana, Madurai, Navi Mumbai, Ooty, Port Blair, Pune, Tirupati, Trivandrum, Vapi, Vijayawada, Vishakhapatnam, Hyderabad, Lavasa, Noida, Manipal, Bengaluru, Mussoorie, Goa, Thane, Gandhinagar and Mysore while several more hotels are expected to be commissioned soon in other key locations in India. 

WelcomHeritage brings together a chain of palaces, forts, havelis and resorts that offer a unique experience. WelcomHeritageendeavours to preserve ancient royal homes and the historical Indian grandeur and opulence for the future Indian generations. WelcomHeritage provides a fine range of hotel services inside these architectural legacies present in Rajasthan, Madhya Pradesh, Uttarakhand, Himachal Pradesh, Jammu & Kashmir, West Bengal, Karnataka, Tamil Nadu, Punjab, Haryana, Assam, Sikkim, Meghalaya, Arunachal Pradesh, Uttar Pradesh, Maharastra, Kerala, Andhra Pradesh and Puducherry. 

WelcomEnviron

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WelcomEnviron is ITC Hotels' vision for a green world. It's a multi-faceted programme started in order to propagate environmental causes in the cities where ITC Hotels' hotels are located. With the guiding principle of 'Reduce, Reuse and Recycle', each hotel has its own programme, encompassing local participation, creating awareness among employees and internal conservation. ITC Green Centre

The ITC Green Centre in Gurgaon, the headquarters of ITC's Hotels Business is the physical expression of this commitment to sustainability - Ecological, Social and Economic. This building is one of the world's largest green buildings with space of over 170,000 square feet and the first non-commercial complex in the country to be awarded the United States Green Building Council-Leadership in Energy and Environmental Design's (USGBC-LEED) platinum rating - the highest in the order.At ITC Green Centre, energy consumption has been reduced significantly through design integration. The building has been designed to maximize the effect of natural light during daytime, largely eliminating the need for artificial ones. This not only keeps the office cool from inside during the day, but also decreases the load on air-conditioners. Again, there is minimum exterior lighting to limit night sky pollution. The water consumption has dropped by 40 per cent and, with a water re-cycling plant, the building is now a zero water discharge building.

ITC Hotels - Empowering Differently-able people

ITC Hotels has established that if provided with an opportunity to work and become self-sufficient, people who are differently able can significantly contribute to the workplace, families and the community. ITC Hotels has taken a positive step in this direction by employing people who are differently able across its hotels. ITC Hotels believes that everyone should be treated with sensitivity and empathy. over Special badges for the visually impaired, whistles for hearing impaired

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employees to use in an emergency and sign language classes for the staff to communicate with them.

Awards

ITC Hotels' strategy of benchmarking against international standards has won its hotels many laurels.

ITC Gardenia, Bengaluru is the first Indian Hotel and world's largest, to get the LEED Platinum rating - the highest green building certification globally.

ITC Hotels was named the Best Premier Hotel Brand at the Galileo-Express TravelWorld Awards 2008 & 2006. ITC WelcomHeritage won the Best Heritage Hotel Brand award in 2006.

ITC Maurya, New Delhi received the award for 'Best Luxury Hotel' at the Star Hospitality Awards 2007-08 and the NATIONAL TOURISM AWARD 2007 for 'Best Eco-Friendly Hotel' from Ministry of Tourism.

WelcomHotel Sheraton New Delhi won the Golden peacock Award 2008 for Environment Management. It was also conferred the '6th Annual Greentech Safety Award' in the Service Sector for the year 2006.

The NCPEDP-Shell Helen Keller Award 2008, 2007 and 2006 to ITC Hotels for the vision, policies and practices demonstrating the belief in equal rights and gainful employment for persons with disabilities.

The National Tourism Award 2007-08 to ITC Grand Central, Mumbai for the best private public enterprise providing facilities for physically challenged guests at the hotel. WelcomHotel, Delhi won the same under the category - Best Eco-Friendly Hotel in 2004-05.

The PATA Gold Award 2005 in the Corporate Environmental category for the WelcomEnvironinitiatives of ITC Hotels.

ITC Sonar, Kolkata has been declared as one of the best hotels in the world by the Association of British Travel Agents (ABTA) in the April 2004 issue of its magazine 'Business & Travel'. ABTA also rated Dublin amongst the top 20 bars and Bukhara the best restaurant in Asia and the finest Indian restaurant in the world.

ITC Maurya, New Delhi is the only hotel in India, to have won the British Safety Council's 'Sword of Honor' thrice.

ITC Maurya, New Delhi is also India's first hotel to be accorded the ISO 14001 certification for its Environment Management Systems. Eight more ITC Hotels followed in quick succession: ITC Windsor, Bengaluru; ITC Kakatiya, Hyderabad; ITC Mughal, Agra; Sheraton Rajputana, Jaipur; Sheraton Chola,

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Chennai; ITC Hotel Park Sheraton & Towers, Chennai, ITC Maratha, Mumbai and ITC Sonar, Kolkata.

ITC Maurya won the Golden Peacock Innovation Management Award in 2008. It is the first hotel in India to be awarded the Golden Peacock Environment Management Award for 2001 by the World Environment Foundation. It won this award again in 2004.

ITC Maurya has been awarded certificate for Excellence in Food Safety Standard from Starwood Asia Pacific Hotels & Resorts in 2008.

ITC Maratha at Mumbai was declared to be the Best Luxury Hotel of the Year 2002, by the Federation of Hotel and Restaurant Associations of India.

ITC Mughal at Agra was Asia's first winner of the Aga Khan Award for Architecture.

ITC Mughal was conferred the Greentech Silver Award for safety and Environment in 2008.

The prestigious 'Golden Fork Award', was also bestowed, by the International Food and Wine Writers Guild, to Bukhara and Dum Pukht restaurants at ITC Maurya.

Bukhara at ITC Maurya in New Delhi has been declared the Best Indian Restaurant in the world by 'The Restaurant Magazine', UK. It has also been voted the Best Restaurant in Asia and is the only Indian restaurant to feature in the list of 50 Best Restaurants in the World for five years since 2002.

ITC Maurya has won Awards for the Best Whisky Restaurant (DumPukht) and the Best Whisky Bar (Golf Bar) in India. Icons of Whisky, the most prestigious Whisky Awards in the World were launched in India for the first time at ITC Maurya in the year 2008.

Kaya Kalp - The Royal Spa at ITC Mughal Agra, launched in May 2008, has been rated the 'World's Best City Spa', by Tatler. It is the only winner from India in 2008 and finds a place, in the prestigious Tatler Spa Guide for 2008 - featuring 101 of the best spas of the world.

ITC Maurya and ITC Mughal have both won the 'Green Hotelier Awards'.

ITC Maurya has also won the International Hotels & Restaurants Association (IH & RA) environmental award twice.

ITC Grand central received the Federation of Hotel & Restaurant Association of India 'Environment Champion Hotel of the Year' in 2008. ITC Maurya won this award in 2002 and 1997 and ITC Mughal, Agra, in 2003.

Fortune Hotels won the Hospitality India Award for the year 2008 in the category of the Best First Class Hotel Chain for the second time since 2006.

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Bay Island at Port Blair, Andaman, was presented 'The Tourism for Tomorrow' award by British Airways in 1993.

 

Group Companies 

 

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PART- 236

FACTS WORTH KNOWING

ITC was established in 1910 by H.O. wills.

ITC was formerly known as Imperial Tobacco Company.

It has 23 marketing branches all over India.

Saharanpur branch is one of the above stated 23 marketing offices.

The structure of ITC marketing office comprises of a Branch manager, two

assistant branch manager, area managers and then area executives of

various goods.

Saharanpur branch deals in all convenience goods like cigarettes, matches,

incest sticks, food products, personal care products.

The monthly sales of Saharanpur office is like

1. Approx. 1.5 crore packets of cigarettes are sold monthly through

Saharanpur branch.

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2. This comprises 6 billion rupees monthly sales.

3. Sales worth rupees 9 crore of food products.

4. Sales of 5 crore liters of personal care products.

Monthly sales of Cigarettes in India are around 7 billion packets.

ITC holds a market share of around 75-78%.

This implies that monthly sales of ITC are around 5 billion packets.

Keeping an average of Rs. 40 per packet, monthly sales of cigarettes comes

out to be 5billion * 40= 200billion rupees.

Saharanpur branch is 2nd most in sales of confectionary products i.e. all toffee

items.

According to a survey, cigarettes smoking people are most brand conscience

and they can’t leave a brand they are smoking for a time. This means the

market share remains more or less same.

TERMS USED IN ITC

DS – Direct salesmen.

WD – Wholesale distributor.

CONSUMER – The final consumer of product.

CUSTOMER – To which product is sold which in this case was retailer. So

ITC didn’t deal in consumers but customers.

PSR – Pilot sales representative ( with a work to take demand from stockiest

and retailers)

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LOCO – Low cost delivery model.

CHIKKA – A cage fitted behind bike to hold goods.

PTR – Price to retailer.

POP – Place of purchase ( advertisement were provided to shops)

M – M is denomination used to measure cigarettes. 1M = 100 cigarettes

packets. So the sale of cigarettes is measured in M’s.

Supervisor – Person provided by company to WD points in order to check if

work is going properly or not.

Stockiest – Stockiest are person appointed by WD’s in order to sell goods at

far flung areas with rates same as WD rates.

Display – Racks on which cigarettes were placed in line so that customer can

see various brands.

An overview of ITC Saharanpur Factory

 ITC Saharanpur Factory was established in the year 1926 and is the second oldest

among all the cigarette factories after Merger. It manufactures processed cut

tobacco and packed cigarettes.

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It has a built up area of 26334 s-m. The facilities include the production block

consisting of primary manufacturing department (PMD) & secondary manufacturing

department (SMD) ,leaf go down ,WMS go down , FG (shipping department) ,

utilities , service block, administrative block & gate house . 

Tobacco leaves are purchased from farmers through auction by ILTD (leaf

tobacco division) & are sending to different ITD factories depending on their

requirement. Tobacco leaves is divided in 2 parts, the lamina (leaf part) & the stem

(the midrib separated from lamina by threshing). Tobaccos leaves are received in

leaf go down & stored till the time they are issued to PMD for processing.

The PMD process in 2 separated lines the (the lamina & the stem line respectively)

which result in processed cut tobacco which gets stored in Cut Tobacco Store (CTS).

From CTS it is issued to SMD for production of packed cigarettes. The SMD is

divided in 2 sections ± the maker & the packer sections.  

Wrapping materials stores (WMS) materials are supplied from WMS go down at this

state both the maker & the packer for production. WMS materials are all other things

cigarettes packet other than the tobacco the maker is responsible for producing

cigarettes sticks& the packer section produces packed cigarettes.

These are then sent to the finished goods go down for temporary storage & eventual

shipment from there.

OBJECTIVE

1. To develop new strategies for increasing ITC’s foothold in rural market.

2. To compare various strategies developed and choose the best.

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3. To implement selected strategy by finding new routes.

4. To recruit new DS for new routes decided.

DISTRIBUTION CHANNEL

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BCG MATRIX

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STAR

Agri Business, Paperboard, Hotels.

QUESTION MARK

FMCG

CASH COW

Cigarettes

DOG

Infotech

MODUS OPERANDI

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BCG matrix here shows clearly 2 things :

1. Cigarettes are very high on market share but low on marketing growth.

2. FMCG products i.e. food items are high on marketing growth but low on

marketing shares.

Portfolio of ITC includes – Gold Flake, Wills Navycut, Classic, Benson & Hedge, India

Kings, Insignia.

Godfrey Phillips India( GPI)- Cavanders, Capstan, Red & White, Four Square,

Malboro.

 Vazir Sultan Tobacco Company (VST)- Moments, Charms.

Others- Rs. 1 cigarettes without filter.

ITC with a market share of 76-78% has a distinct advantage of having a product in

almost every part of country. So the strategy was like this only to sell other slow moving

goods using cigarettes channel.

ITC distinguished various product categories according to their features. This helps

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them to differentiate easily what to be sold and what not.

1. Glossary products

a. Aashirwad Flour.

b. Sunfeast Biscuits.

c. Bingo chips.

d. Candyman toffees.

2. Personal Care products

a. Vivel cream.

b. Superia soaps, shampoos.

c. Vivel soaps, shampoos.

3. Convenience products

a. Cigarettes

b. Safety Matches

c. Incest sticks, dhoops.

Out of these categories above stated, the sales of glossary products and personal care

products are very slow. On the other hand Cigarettes once entered into market sells

like water.

So ITC utilized this strategy to move various products with cigarettes DS into rural

market. Rural market can easily accommodate low cost products if they are put to

display on counters where cigarettes are also sold.

RURAL MARKETING

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Rural marketing deals with introducing and increasing sales of new or already

existing products into rural market, where rural market is a term used for villages or

small areas with population less than 10000.

Strategies one can use to enter and increase sales in rural market:

1 BY COMMUNICATING AND CHANGING QUALITY PERCEPTION

Companies are coming up with new technology and they are properly communicating it to the customer. There is a trade-o between Qualities a customerPerceives and a company wants to communicate. Thus, this positioning ofTechnology is very crucial. The perception of the Indian about the desiredProduct is changing. Now they know the difference between the productsand the utilities derived out of it. As a rural Indian customer always wantedvalue for money with the changed perception, one can notice difference inCurrent market scenario.

2 BY PROPER COMMUNICATION IN INDIAN LANGUAGE

The companies have realized the importance of proper communication inlocal language for promoting their products. They have started selling theconcept of quality with proper communication. Their main focus is to changethe Indian customer outlook about quality. With their promotion, ruralcustomer started asking for value for money

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3 BY TARGET CHANGING PERCEPTION

If one go to villages they will see that villagers using Toothpaste, even whenthey can use Neem or Babool sticks or Gudakhu, villagers are using soapsLike Nima rose, Breeze, Cinthol etc. even when they can use locally manufactured very low priced soaps. Villagers are constantly looking forwardfor new branded products. What can one infer from these incidents, is theParadigm changing and customer no longer price sensitive? Indian customerwas never price sensitive, but they want value for money. They are ready topay premium for the product if the product is offering some extra utility forthe premium.

4 BY UNDERSTANDING CULTURAL AND SOCIAL VALUES

Companies have recognized that social and cultural values have a very stronghold on the people. Cultural values play ma jor role in deciding what to buy.Moreover, rural people are emotional and sensitive. Thus, to promote theirbrands, they are exploiting social and cultural values.

5 BY PROVIDING WHAT CUSTOMER WANT

The customers want value for money. They do not see any value in frillsassociated with the products. They aim for the basic functionality. However,if the seller provide frills free of cost they are happy with that. They arehappy with such a high technology that can fulfill their need. As”Motorola”has launched, seven models of Cellular Phones of high technology but noneto ok o . On the other hand,”Nokia” has launched a simple product, whichhas captured the market.

6 BY PROMOTING PRODUCTS WITH INDIAN MODELS AND ACTORS

Companies are picking up Indian models, actors for advertisements as thishelps them to show themselves as an Indian company. Diana Hayden andShahrukh Khan is chosen as a brand ambassador for MNC quartz clockmaker ”OMEGA” even though when they have models like Cindy Crawford.

7 BY ASSOCIATING THEMSELVES WITH INDIA

MNCs are associating themselves with India by talking about India, by explicitly saying that they are Indian. M-TV during Independence Day andRepublic daytime make their logo with Indian tri-color. Nokia has designeda new cellular phone 5110, with the India tri-color and a ringing tone of”Sare Jahan se achcha”.

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8 BY PROMOTING INDIAN SPORTS TEAM

Companies are promoting Indian sports teams so that they can associatethemselves with India. With this, they influence Indian mindset. LG haslaunched a campaign”LG ki Dua, all the best”. ITC is promoting Indiancricket team for years, during world cup they have launched a campaign”Jeeta hai jitega apna Hindustan India India India”. Similarly, Whirlpoolhas also launched a campaign during world cup.

9 BY TALKING ABOUT A NORMAL INDIAN

Companies are now talking about normal India. It is a normal tendency ofan Indian to try to associate himself/herself with the pro duct. If he/she canvisualize himself/herself with the pro duct, he /she becomes loyal to it. Thatis why companies like Daewoo based their advertisements on a normal Indianfamily.

10 BY DEVELOPING RURAL-SPECIFIC PRODUCTS

Many companies are developing rural-specific products. Keeping into consideration the requirements, a firm develops these pro ducts. Electrolux isworking on a made-for India fridge designed to serve basic purposes: chilldrinking water, keep cooked food fresh, and to withstand long power cuts.

11 BY GIVING INDIAN WORDS FOR BRANDS

Companies use Indian words for brands. Like LG has used India brand name”Sampoorna” for its newly launched TV. The word is a part of the Bengali,Hindi, Marathi and Tamil tongue. In the past one year, LG has sold one lakh20-inch Sampoorna TVs, all in towns with a population of around 10,000.By the end of 1999, roughly 12Thats Rs 114 crore worth of TV sets sold inthe villages in a year.

12 BY ACQUIRING INDIAN BRANDS

As Indian brands are operating in India for a long time and they enjoy agood reputation in India. MNCs have found that it is much easier for themto operate in India if they acquire an Established Indian Brand. Electroluxhas acquired two Indian brands Kelvinator and Allwyn this has gave themthe well-established distribution channel. As well as trust of people, as peoplebelieve these brands. Similarly Coke has acquired Thumps up, Gold Spot,

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Citra and Limca so that they can kill these brands, but later on they realizedthat to survive in the market and to compete with their competitor they haveto rejuvenate these brands.

13 BY EFFECTIVE MEDIA COMMUNICATION

Media Rural marketing is being used by companies. They can either go forthe traditional media or the mo dern media. The traditional media includemelas, puppetry, folk theatre etc. while the modern media includes TV, radio, e-chaupal. LIC uses puppets to educate rural masses about its insurancepolicies. Govt. of India uses puppetry in its campaigns to press ahead socialissues. Brook Bond Lipton India ltd used magicians electively for launch ofKadak Chap Tea in Etawah district. In between such a show, the lights areswitched on and a torch is ashed in the dark(EVEREADYs tact). ITC’se-chaupal (chaupal is the common place where villagers gather) has been themost elaborate and extensive venture in this field so far. Conceived by ITC’sinternational business division and launched in 2000, the e-chaupal projecthas since grown to around 2,700 chaupals covering a population of around1.2 million in five states – Madhya Pradesh, Karnataka, Andhra Pradesh,Uttar Pradesh and Maharashtra.Rural marketing requires the understanding of the complexities and thisarticle reviews some of the key issues. Indian agricultural industry has beengrowing at a tremendous pace in the last few decades. The rural areas areconsuming a large number of industrial and urban manufactured pro ducts.The rural agricultural production and consumption process plays a predominant role in developing the Indian economy. This has designed a new way forunderstanding a new process called Rural Marketing. The concept of ruralmarketing has to be distinguished from Agricultural marketing. Marketing isthe process of identifying and satisfying customers needs and providing themwith adequate after sales service. Rural marketing is different from agricultural marketing, which signifies marketing of rural products to the urbanconsumer or institutional markets. Rural marketing basically deals with delivering manufactured or processed inputs or services to rural producers, thedemand for which is basically a derived outcome. Rural marketing scientistsalso term it as developmental marketing, as the process of rural marketinginvolves an urban to rural activity, which in turn is characterized by variouspeculiarities in terms of nature of market, products and processes. Ruralmarketing differs from agricultural or consumer products marketing in termsof the nature of transactions, which includes participants, products, modalities, norms and outcomes. The participants in case of Rural Marketingwould also be different they include input manufacturers, dealers, farmersopinion makers, government agencies and traders. The existing approach

49

to the rural markets has viewed the markets as a homogeneous one, but inpractice, there are significant buyer and user differences across regions as wellas within that requires a differential treatment of the marketing problems.These differences could be in terms of the type of farmers, type of crops andother agro-climatic conditions. One has to understand the market normsin agricultural input so as to devise good marketing strategies and to avoidunethical practices, which distort the marketing environment. Many of theinputs used for production process have implications for food, health andenvironmental sectors. Rural marketing needs to combine concerns for profitwith a concern for the society, besides being titled towards profit. Ruralmarket for agricultural inputs is a case of market pull and not market push.Most of the jobs of marketing and selling is left to the local dealers and retailers. The market for input gets interlocked with other markets like output,consumer goods, money and labour. The importance of rural marketing canbe understood from the fact that today modern inputs i.e. diesel, electric-ity, fertilisers, pesticides, seeds account for as much as 70Green Revolutionareas. Further the percentages were higher at 81of land. Strategic aspectsRural marketing in India is not much developed there are many hindrancesin the area of market, product design and positioning, pricing, distributionand promotion. Companies need to understand rural marketing in a broadermanner not only to survive and grow in their business, but also a means tothe development of the rural economy. One has to have a strategic view ofthe rural markets so as to know and understand the markets well. In thecontext of rural marketing one has to understand the manipulation of marketing mix has to be properly understood in terms of product usage. Productusage is central to price, distribution, promotion, branding, company imageand more important farmer economics, thus any strategy in rural marketingshould be given due attention and importance by understanding the productusage, all elements of marketing mix can be better organised and managed.

14 BY ADOPTING LOCALISED WAY OF DISTRIBUTING

Proper distribution channels are recognized by companies. The distributionchannel could be a Big scale Super markets, they thought that a similarsystem can be grown in India. However, they were wrong, so on they realizedthat to succeed in India they have to reach the nook and the corner ofthe country. They have to reach the ”local Paan wala, Local Baniya” onlythey can succeed. MNC shoe giants, Adidas, Reebok, Nike started withexclusive stores but soon they realized that they do not enjoy much BrandEquity in India, and to capture the market share in India they have to go thelocal market shoe sellers. They have to reach to local cities with low priced

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products.

15 BY ASSOCIATING THEMSELVES WITH INDIAN CELEBRITIES

MNCs have realized that in India celebrities enjoyed a great popularityso they now associate themselves with Indian celebrities. Recently LuxorWriting Instruments Ltd. a JV of Gillette and Luxor has launched 500”Gajgamini” range of Parker Sonnet Hussain special edition fountain pens,priced at Rs. 5000. This pen is signed by Mr. Makbul Fida Hussain arenowned painter who has created”Gajgamini” range of paintings. Companies are promoting players like Bhaichung Bhutia, who is promoted byReebok, so that they can associate their name with players like him and getpopularity.

16 MELAS

Melas are places where villagers gather once in a while for shopping. Companies take advantage of such events to market their products. Dabur usesthese events to sell products like JANAM GHUTI(Gripe water). NCAERestimates that around half of items sold in these melas are FMCG productand consumer durables. Escorts also displays its products like tractors andmotorcycles in such melas.

17 PAINTINGS

A picture is worth thousand words. The message is simple and clean. Ruralpeople like the sight of bright colours. COKE, PEPSI and TATA traders advertise their products through Painting.

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CHALLENGES OF RURAL MARKETING

The rural market may be attracting marketers but it is not without its problems:

Low per capita disposable incomes that is half the urban disposable

income;

Large number of daily wage earners, acute dependence on the vagaries of the

monsoon;

seasonal consumption linked to harvests and festivals and

special occasions;

poor roads;

power problems; and

Inaccessibility to conventional advertising media.

However, the rural consumer is not unlike his urban counterpart in many ways. The

more marketers are meeting the consequent challenges of availability, affordability,

acceptability and awareness in rural market.

Availability

The first challenge in rural marketing is to ensure availability of the product or service.

India's 7, 00,000 villages are spread over 3.2 million sq km; 700 million Indians may

live in rural areas, finding them is not easy. They are highly dispersed.Given the poor

infrastructure, it is a greater challenge to regularly reach products to the far-flung

villages. Marketer should plan accordingly and strive to reach these markets n a

regular basis. Marketers must trade off the distribution cost with incremental market

penetration.India's largest MNC, Hindustan Lever, a subsidiary of Unilever, has built a

strong distribution rural India as a future growth driver, has evolved a hub and spoke

distribution model to reach the villages.

To ensure full loads, the company depot supplies, twice a week, large distributors

which who act as hubs. These distributors appoint and supply, once a week, smaller

I T C I N D I A P V T L T D Page 62

distributors in adjoining areas. LG Electronics has set up 45 area offices and 59

rural/remote areas offices to cater to these potential markets.

Affordability

The second major challenge is to ensure affordability of the product or service. With

low disposable incomes, products need to be affordable to the rural consumer, most of

who are on daily wages. A solution to this has been introduction of unit packs by some

companies. This ensures greater affordability. Most of the shampoos are available in

smaller packs.

Fair and lovely was launched in a smaller pack.

Colgate toothpaste launched its smaller packs to cater to the traveling segment and the

rural consumers.

Godrej recently introduced three brands of Cinthol , Fair Glow and Godrej in 50- gm

packs.

Hindustan Lever has launched a variant of its largest selling soap brand, Lifebuoy.

Coca-Cola has addressed the affordability issue by introducing the smaller bottle priced

at Rs 5. The initiative has paid off: Eighty per cent of new drinkers now come from the

rural markets. A series of advertisement for this was rune showing people from diverse

backgrounds featuring Amir Khan.

Acceptability

The next challenge is to gain acceptability for the product or service. Therefore, there is

a need to offer products that suit the rural market. LG Electronics have reaped rich

dividends by doing so. In 1998, it developed a customized TV for the rural market

named Sampoorna. It was a runway hit selling 100,000 sets in the very first year.

Coca-Cola provided low-cost ice boxes in the rural areas due to the lack of electricity

and refrigerators. It also provided a tin box for new outlets and thermocol box for

seasonal outlets.

I T C I N D I A P V T L T D Page 62

The insurance companies that have tailor-made products for the rural market have also

performed well. HDFC Standard LIFE topped private insurers by selling policies worth

Rs 3.5 crore in total premia. The company tied up with non-governmental organizations

and offered reasonably-priced policies in the nature of group insurance covers.

Awareness

A large part of rural India is inaccessible to conventional advertising media. Only 41 per

cent rural households have access to TV. Building awareness is another challenge in

rural marketing. A common factor between the rural and the urban consumer is the

interest for movies and music. Family is the key unit of identity for both the urban and

rural consumer. However, the rural consumer expressions differ from his urban

counterpart. For a rural consumer, outing is confined to local fairs and festivals and TV

viewing is confined to the state-owned Doordarshan. Consumption of branded products

is treated as a special treat or indulgence.

Hindustan Lever has its own company-organized media.

These are promotional events organized by stockiest. Godrej Consumer Products,

which is trying to push its soap brands into the interior areas, uses radio to reach the

local people in their language.

Coca-Cola uses a combination of TV, cinema and radio to reach the rural households.

It has also used banners, posters and tapped all the local forms of entertainment. Since

price is a key issue in the rural areas, Coca-Cola advertising stressed its `magical'

price point of Rs 5 per bottle in all media. LG Electronics uses vans and road shows to

reach rural customers. The company uses local language advertising. Philips India

uses wall writing and radio advertising to drive its growth in rural areas. Also, in India,

the retailers are highly fragmented, highly dispersed. At the same time, each of these

regions serves a large population. The media penetration in rural areas is only about

57%.It has been seen that, two out of five Indians are unreached by any media

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IMPROVEMENT IN RURAL AREAS (INDIA)

Infrastructure is improving rapidly:-

In 50 years only 40% villages connected by road, in next 10 years

another 30%.

More than 90 % villages are electrified.

Social Indicators have improved a lot between 1981 and 2007

Number of Pucca Houses tripled from 22% to 59% and Kuccha houses

halved from 41% to 23%.

Percentage of BPL i.e. Below Poverty Line families declined from 46% to

27%

Rural literacy level improved from 36% to 59%.

Low penetration rate in Rural areas so there are many marketing

opportunities.

WHAT MAKES RURAL MARKETING OF INDIA MORE ATTRACTIVE?

It is an upcoming market and the following facts substantiate this.

800 million people

In 2001-02, LIC sold 55 % of its policies in rural India.

Of two million BSNL mobile connections, 50% are in small towns/villages.

Of the six lakh villages, 5.22 lakh have a Village Public Telephone (VPT).

41 million Kisan credit card issued against 22 million credit plus debit card in

urban areas.

42 million rural household are availing banking services in comparison to 27

million urban household.

The rural market is highly fragmented and the supply chain for the FMCG Goods

is very strong.

Changing profile of rural consumers

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Rural consumers as studied are dependent on agriculture and were not very literate

about products and services available. This scenario is slowly changing due to

increase in literacy and disposable income. Not long ago, rural consumers went to a

nearby city to buy “branded products and services". Only select household consumed

branded goods, be it tea or jeans. Earlier, big companies flocked to rural markets to

establish their brands.

Rural markets today are critical for every marketer - be it for a branded shampoo or a

television. Earlier marketers thought of van campaigns, cinema commercials and a few

wall paintings to entice rural folks under their folds.

Today a customer in a rural area is quite literate about myriad products that are on

offer in the market place, thanks to television. Many companies are foraying into the

rural markets and educating them on newer products and services.

The rural youth today are playing a far more significant role in influencing the purchase

decisions. They travel frequently out in the village and are the drivers of purchase

decisions regarding radios, television (black and white as well as color), automobiles

and other goods.

They may not be the end customers but often are the people who influence the

purchase of high value products and they decide on which brands to choose.

Penetration levels of consumer durables in the rural sector have risen dramatically in

the last decade or so. Even the rural woman is coming out of the closet. She is

exercising her choice in selecting categories - the choice of brands may still be with the

males of the household. The prerogative of making the final purchase decisions stills

rests with the chief male. In other words, the “chief wage earner” syndrome still applies

in the rural markets.

Features of Indian Rural Markets:

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Large Diverse and Scattered Market: Rural market in India is large, and scattered into

a number of regions. There may be less number of shops available to market products.

Major Income of Rural consumers is from Agriculture. Rural Prosperity is tied with

agriculture prosperity. In the event of a crop failure, the income of the rural masses is

directly affected.

Standard of Living and rising disposable income of the rural customers: It is known that

majority of the rural population lives below poverty line and has low literacy rate, low

per capital income, societal backwardness, low savings, etc. But the new tax structure,

good monsoon, government regulation on pricing has created disposable incomes.

Today the rural customer spends money to get value and is aware of the happening

around him.

Traditional Outlook: Villages develop slowly and have a traditional outlook. Change is a

continuous process but most rural people accept change gradually. This is gradually

changing due to literacy especially in the youth who have begun to change the outlook

in the villages.

Rising literacy levels: It is documented that approximately 45% of rural Indians are

literate. Hence awareness has increases and the farmers are well-informed about the

world around them. They are also educating themselves on the new technology around

them and aspiring for a better lifestyle.

Diverse Socioeconomic background: Due to dispersion of geographical areas and

uneven land fertility, rural people have disparate socioeconomic background, which

ultimately affects the rural market.

Infrastructure Facilities: The infrastructure facilities like cemented roads, warehouses,

communication system, and financial facilities are in adequate in rural areas. Hence

physical distribution is a challenge to marketers who have found innovative ways to

market their products.

CLASSIFICATION OF RURAL MARKETS

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As already discussed, the title of project includes words ‘using lower population group

strategy and execution’. Now what does this lower population groups means. When it

comes to rural market, ITC has classified villages according to number of inhabitants of

that village. This kind of classification helps ITC to narrow down the exact village they

want to enter for increasing their foothold in rural market.

ITC caters various products across wide range of customer segments. A company 100

yrs old knows what it is doing and why. But due to stiff competition from their major

rivals like HUL, Godrej, GPI, Parle, Britannia and many more, they have to change their

way of working in rural market. By large ITC had some sort of presence in rural market

in terms of food and personal care products. Although it had a major chunk of presence

in terms of cigarettes. But it is very much unnecessary to market cigarette because of

some social and personal factors. So when we talk about food and personal care

product, in rural market it was lagging behind its competitors in terms of sales due to

less presence and it is very well said that in market, an opportunity lost is lost forever.

So according to plan ITC tried to enter rural market. For start they have divided

villages according to population as already discussed.

Villages with population 2000 to 5000 people. Villages with population 5000-10000 people. Villages with population 10000-20000 people. Villages with population 20000-50000 people.

When discussing about the lower population group strategy, it includes villages ranging from

2000-5000 people, 5000-10000 people. Rest all are considered semi urban areas and are pretty

big to hold a stockiest for themselves. Hence the moped DS model can be successful in only

these kinds of villages.

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The red circles here depict various villages around Saharanpur district.

The red lines depict route to these villages were vans and other vehicles can’t reach otherwise.

Further we will show the close-up of these villages.

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1. Nanheda Gazhi2. Unknown (50 houses)3. Baliya kheri.

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If compared to other towns like Gangoh which has population of about 50000

(Wikipedia) the above shown villages can easily be put under category lower

population group.

A view of Gangoh (Saharanpur) by satellite.

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RESEARCH MOTHODOLOGY

Define the Research objective:

The main objective of the project is to know – Rural Marketing of ITC Ltd. in rural

areas of Saharanpur

[A]- Sample Size:-

There is no particular sample size. I have to collect data from maximum number of

shops in villages and rural area of Saharanpur. Still I gathered data from 100 odd

shops.

[B]-Sampling Unit:-

Sampling unit i.e. who is to be surveyed. Thus here the existing customer of rural area

of Saharanpur. Customer here is the retailers from which these questions were asked.

[C]-Sample Method:-

Though both probability and non probability sampling method can be used. But non

probability sampling is a convenient sampling method and judgmental sampling was

done for experience and acquiring objective.

[D]- Location:-

Location of my research is rural market of Saharanpur.

[E] -Parameters of study:-

1-Research is based on identification the rural market position of ITC Ltd. Saharanpur.

2-Improvement of surveys by company.

3-Identification the weakness of company.

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[F] –Method of data collection:-

{i}-Primary data:-

These data were collected by personal interview with the existing customer.

{ii}-Secondary data:-

These data were collected from: -

[a] Related books, report magazines

[b] Industrial publications

[c] Website.

Tools:-

1. Questionnaire

2. Personal interview

Contact Method: Visiting physically to the customer of rural areas of Saharanpur and

used personal interview.

FINDING AND ANALYSIS

After the successful completion of summer training in Saharanpur’s rural areas in ITC

Ltd. , one of the largest company in India on the topic Rural Marketing in ITC Ltd. I

was able to find that the market strategies of ITC Ltd. growing fast in rural areas of

Saharanpur.

ITC Ltd. has strong marketing policy among all competitor that is the main reason of

success of ITC Ltd. in rural areas of Saharanpur.

There are following some graphical representation:

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1. Reason for buying any product.

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2. How much is customer satisfied with ITC.

3. Availability of product.

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4. How are sales of ITC products in general?

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5. Possible reasons why ITC is outperformed by other brands.

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*the survey done here was not official in any manner and was a general study only.

FINDINGS

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Very interesting results came when all these questions were asked from various

retailers situated in deepest of rural market:

1. Customer prefer price over any other thing.

2. Availability of products of ITC is one major issue.

3. Other reason is lack of advertising in rural markets.

4. ITC products are competitively priced so they hold value in market.

5. Quality of ITC products is at par with other products.

6. Sales of ITC product is very low due to above stated reasons.

So as seen above, sales of ITC was severely affected due to lack of availability of

products in rural markets. The reason being that retailers go to town once a week and

pick other brands as they cost less than ITC products if bought otherwise.

So ITC decided to come up with a strategy called MOPED DS.

Moped DS is nothing but sending direct salesman on bikes to interior of villages so that

salesman could directly provide product to retailer with discounts and no efforts. This

way retailer will be more interested in buying ITC product which already sells due to its

quality and price. So what we decided to come out with new modes of transporting

goods to retailer which could be more efficient. We came up with various models which

will be discussed ahead.

MODES OF REACHING RURAL MARKETS

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ITC employs various methods to reach different kinds of retailers. They classify their

locations of retailers under three main categories:

1. Highway retailers

2. Town retailers

3. Rural retailers.

For highway retailers ITC uses highway vans. These vans are particularly run by

either stockiest or WD. various types of vehicles were employed for this

purpose. Tata ace and Mahindra pickup were primary choice of WD

.

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For local town distribution WD mostly employees manually pulled rickshaws or

cycles.

Now comes rural market. When it comes to distribution to rural market, one

cannot employee above stated modes due to obvious reason.

Rural market is situated within 50km radius.

The lanes or gullies are very narrow.

So we have to find new ways as manually pulled rickshaws nowhere can travel more

than 10 km radius and vehicles like Tata ace cannot enter village lanes. So Moped DS

project was inducted.

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MOPED DS

Moped DS as discussed before is mode of distribution on bike or automatic rickshaws.

We came up with two designs for this.

Chikka Model

LOCO model (Low cost Delivery model)

Chikka Model.

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LOCO Model.

As shown above, Chikka model is nothing but a customized bike on which a iron cage

is fitted behind to hold cartons whereas LOCO model is a rickshaw fitted with a scooter

or bike engine to make it automatic.

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COMPARATIVE ANALYSIS

Cheekha Model Loco model

COST Rs. 15000-40000 Rs. 18000-25000

MILEAGE 40-60 KMPL 15-20 KMPL

TOP SPEED 30-50 KMPH 10-30 KMPH

TOTAL LOAD 7-8 CARTONS 12-15 CARTONS

TOTAL SALES(DAILY EXCLUDIMG CIGGARETES)

Rs. 2000-5000 Rs. 5000- 12000

*Data shown above is based on study done by following them on various

routes.

COMPARATIVE ANALYSIS- COST

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LOCO MODEL CHEEKHA MODEL

• INPUT COST

Vehicle= Rs. 20000 (2 nd hand good

condition)

Fuel = Rs. 200/day ( 50km running

and 15-20 kmpl mileage incl.

maintenance)

• OUTPUT COST

Sales = Rs. 5000-12000

( depending on sales)

• INPUT COST

Vehicle= Rs. 18000(2 nd hand good

condition)

Fuel = Rs. 100/day ( 50km running

and 35-50 kmpl mileage incl.

maintenance)

• OUTPUT COST

Sales = Rs. 2000-5000

( depending on sales)

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RESULTS OF ANALYSIS

• LOCO Model –> fuel = Rs. 5200/ month

Sales = Rs. 200000/ month (7000 daily average)

• CHEEKHA Model -> Fuel = Rs. 2600/ month

Sales = Rs. 80000/ month (3000 daily average)

• DIFFERENCE -> FUEL = Rs. 2600 AND SALES = Rs. 100000

• THIS MEANS LOCO MODEL HAS CONSIDERABLE AMOUT OF BENEFITS

OVER CHEEKHA MODEL.

• i.e. we can increase our sales upto 1 lakh rupees per month with little input

of Rs. 2600 only.

• More and more LOCO model can result in increased sales of

unprecedented amount.

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RECRUITMENT

After successful drive to develop new strategies of reaching rural market was over,

another problem was to motivate WD and stockiest to run these LOCO models or

Moped DS. The problem here was these vehicles have to be started by WD and

stockiest on their own. Company will only provide money for salesman. So company

devised a triple benefit scheme for all salesman doing sales in rural marketing.

Triple benefit scheme:

Fixed salary Rs. 1200-2000 depending upon experience.

Running cost Rs. 1.5/ km.

Margins on sales on monthly basis :

a. 3% on food products.

b. 3% on personal care products.

c. 0.8% on cigarettes.

By following various DS on route for days I concluded that on an average a moped DS

can do sales upto:

Rs. 8000 cigarettes

Rs. 3300 Food

Rs. 3150 Personal care products.

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Doing calculations based on margins we get:

Food products = Rs 99

Personal care products = Rs. 94.5

Cigarettes = 64

Total = Rs. 260/day

Total margin benefits = 6700-7000 / month

Total running cost = Rs. 2000/ month

Income = Rs. 1500

So total earnings for a salesman associated with ITC is approximately

7000+2000+1500 = Rs 10500.

Whereas when we asked salesman of other brands we were told that although they

have a fixed salary of Rs. 5000 still they earn Rs. 7500 / month only.

These all benefits were explained to various Stockiest, WD’s and individual salesman

for the purpose of recruitment. Although sounding exciting, such offers were unable to

pull much of salesman into ITC’s area because of many reasons will be stated later.

Many individual salesmen were motivated extensively but the result came from

stockiest only because indirectly it was benefiting their monthly sales.

The final figures which include successful, unsuccessful salesman were like this:

Successful- 7

Unsuccessful- 5

Waiting- 4(later 3 agreed and 2 rejected)

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Reasons of Unsuccessful conversions were varied. Few of them are:

1. Low fixed salary.

2. Vehicle have to be owned by salesmen only

3. More lucrative offers from rival brands.

4. Route doesn’t suit the salesmen.

5. Few salesmen wanted to be stockiest in their area which was a decision to be

taken by upper management.

6. Few salesmen contacted were graduates and even post graduates so they

didn’t want margin based job.

So all the salesmen contacted by me were to be interacted with my Area executive.

Area executive asks for their experience and routes.

WD asks for a guarantor because in the past there had been issues like running away

with stock.

Successful DS were given training in which they were given rate list and they were told

to come at WD point early in morning and collect the stock, then do sales and return in

evening with remaining stock and cash. Salesmen were to be paid by company on

monthly basis so they can’t demand money from WD points.

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LIMITATION

Place of study was western Uttar Pradesh only.

The time period was short to understand about rural marketing.

Marketing strategies of other brands is difficult to find out.

The findings of the survey were totally depending on the response of the respondent that may not be correct in each and every case.

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RECOMMENDATION

It is very difficult part of a summer training to give recommendation in such a hard topic

with a very short period of time. During my survey I found some points which were told

to respective authorities and they took action on it.

Run LOCO model as much as possible.

Maintain the supply of product as per demand of the market.

Advertize the products more aggressively in rural market.

Sell food and personal care products instead of cigarettes to new retailers.

Give dress and caps to salesman to create brand awareness.

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CONCLUSION

In the end I will say that working in ITC Ltd. was a very good experience for me, as

being a management student we need practical knowledge also apart from our class

knowledge. Being a student of marketing it is important to have knowledge of all the

aspect related to it, which I learnt in ITC Ltd. SAHARANPUR. Marketing and

distribution are two basic functions which have to perform well by every business to

succeed.

The summer training gave me immense opportunity to have exposure and ideas in the

field of marketing. I came to know about aspects of rural marketing and distribution.

During my summer training at ITC Ltd. Saharanpur, I got chance to do several kind of

operations. It was a great experience for me. I came to know that how these marketing

strategies are made.

I would say that since India is divided into 70-30 split of rural and urban market, still lot

of markets are untapped and successful tapping can make ITC market leader. Moped

DS is one such initiative which can prove to be a boon for ITC if maintained for longer

period of time.

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BIBLIOGRAPHY

BOOKS:-

Marketing management:

Philip Kotler

Marketing research:

G.C. Beri

Websites:

www.google.com

www.itcportal.com

www.yahoo.com

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