CERTIFICATE

This is to certify that____, a student of MMS- IV from Institute of Management

Studies and Research, , has done this project under my guidance. The project is titled

“Study of the launch of chocolate ‘Nuts ‘bout U’ by Amul and a Post-launch

Customer Satisfaction Survey”.

It is the original work of the candidate and has not been submitted elsewhere for any

degree or diploma. The sources of the literature have been duly quoted.

The project was undertaken in partial fulfillment of the requirements of MMS

program of Mumbai University for the year 2001-03.

ACKNOWLEDGEMENT

For achieving any goal, one always needs a source of inspiration. That is what I

received from our project guide ProfRajuu . It is his sincere help, which made me able

to complete my project successfully within time. So, I express my most sincere

gratitude for his worthy and inspiring guidance.

I am thankful to all the respondents for taking their valuable time & providing me the

essential data.

I am also grateful to Miss Ritu Bhandari – Accounts Planner for FCB Ulka

Advertising for the help and assistance provided – in form of knowledge, and other

facilities, which went a long way in making the project complete and holistic.

The project has been an excellent learning exercise for it and I hope it will help me to

a great extent in my future endeavors in the field of marketing.

Raja Hindustani

MMS-IV (Marketing)

EXECUTIVE SUMMARY

Gujarat Co-operative Milk Marketing Federation has been one of the major industries

in India. It has been the leader in the dairy industry and is the market leader with its

Amul cheese and Amul butter. Amul has also entered the ice cream segment as an

extension of its dairy products line. It faces major competition in this segment from

Kwality Walls, a brand of Hindustan Lever Ltd.

Amul is currently the market leader in the ice cream segment with the highest sales.

The perception that teenagers have towards the brand of Amul ice cream is not

known. Hence, primary and secondary research was conducted to evaluate whether

the target audience (teenagers) perceives the brand to be the No 1 in the market. The

research was conducted by means of a questionnaire that gave us the following

insights:

Perception of the target audience towards Amul ice cream.

To estimate and analyze the gaps between the consumers expectations and

services provided by the company.

To study the perception towards competitors brand vis – a – vis Amul.

To qualitatively analyze where Amul stands in the ice cream market in the

minds of the target audience.

Recommendations were made on basis of the findings to enhance the brand image and

perceptions in the mind of the target audience.

Hence, the purpose of this project was to estimate the market realities in terms of

customer preferences and their perceptions about the active players.

INTRODUCTION

“While we may justifiably take pride in having built the largest food product business

in the country, we do not pause to rest upon our laurels. In all that we do, and will do,

we never forget that we face an increasingly competitive environment. In this

environment, we have survived and grown on the basis of our greatest strength: co-

operative culture, co-operative networking, market acumen and respect for both

producer and the consumer.”

HISTORY OF AMUL

Amul: The origin

The mighty Ganges at its origin is but a tiny stream in the Gangotri ranges of the

Himalayas. Similar is the story of Amul, which inspired 'Operation Flood' and

heralded the 'White Revolution' in India. It began with two village cooperatives and

250 liters of milk per day, nothing but a trickle compared to the flood it has become

today. Today Amul collects, processes and distributes over a million liters of milk

and milk products per day, during the peak, on behalf of more than a thousand

village owned by half a million farmer members. Further, as Ganga-ma carries the

aspirations of generations for moksha, Amul too has become a symbol of the

aspirations of millions of farmers.Creating a pattern of liberation and self-reliance for

every farmer to follow.

 How did the Amul brand become what it is? To answer that, we must journey back

in time, to the history books, to the time of India’s independence because Amul’s

birth is indelibly linked to the freedom movement in India. It was Sardar Vallabhbhai

Patel who said that if the farmers of India are to get economic freedom then they

must get out of the clutches of the ‘middlemen’.

The first Amul cooperative was the result of a farmers’ meeting in Samarkha (Kaira

district, Gujarat) on 4 January 1946, called by Morarji Desai under the advice from

Sardar Vallabhbhai Patel, to fight rapacious milk contractors. It was Sardar’s vision

to organize farmers, to have them gain control over production, procurement and

marketing by entrusting the task of managing these to qualified professionals,

thereby eliminating the middle men, the bane in farmers’ prosperity.

The decision was taken that day in January 1946: Milk producers’ cooperatives in

villages, federated into a district union, should alone handle the sale of milk from

Kaira to the government-run Bombay Milk Scheme. This was the origin of the

Anand pattern of cooperatives. The colonial government refused to deal with the

cooperative. The farmers called a milk strike. After fifteen days the government

capitulated. This was the beginning of Kaira District Cooperative Milk Producers’

Union Ltd., Anand, registered on 14 December 1946.

Originally the Anand pattern included dairy cooperative societies at the village level,

and a processing unit called a ‘union’ at the district level. Inspired by the Kaira

Union, similar milk unions came up in other districts too. In 1973, in order to market

their products more effectively and economically, they formed the Gujarat

Cooperative Milk Marketing Federation Limited (GCMMF Ltd.). GCMMF became

the sole marketer of the original range of Amul products including milk powder and

butter. That range has since grown to include ice cream, ghee, cheese, chocolates,

shrikhand, paneer, and so on. These products have made Amul a leading food brand

in India.

A quality control expert in Anand suggested the brand name AMUL, from the

Sanskrit Amoolya, meaning priceless. The first products with the Amul brand name

were launched in 1955. Since then, they have been in use in millions of homes in all

parts of India, and beyond. Today Amul is a symbol of many things: Of high quality

products sold at reasonable prices, of availability, of service.

There is something more, though, that makes the Amul brand special and that

something is the reason for our commitment to quality and value for money. Amul is

the brand name of 2 million farmers, members of 10,000 village dairy cooperative

societies throughout Gujarat. This is the heart of Amul, it is what gives strength to

Amul, and it is what is so special about the Amul saga.

In the early days of Kaira Union there was no dearth of cynics. Could ‘natives’

handle sophisticated dairy equipment? Could western-style milk products be

processed from buffalo milk? Could a humble farmers’ cooperative market butter

and cheese to sophisticated urban consumers? The Amul team – farmers and

professionals – confounded the cynics by processing a variety of high-grade dairy

products, several of them for the first time from buffalo milk, and marketing them

nationally against tough competition.

What began way back in 1946 was really an effort to carve out a truly Indian

company that would have the involvement of millions of Indians and place direct

control in the hands of the farmers. It was a mandate for producing, owning and

marketing and above all, building your own truly Indian Brand. And successfully at

that.

You will appreciate that when the lives of lakhs of farmers depend on a brand, and

when your history is grounded in the Independence movement, when not only

competitors but even your own government questions you, then your resolve to be

the best is like the finest steel.

Amul, therefore, is a brand with a difference. That difference manifests itself in a

larger than life purpose. The purpose – freedom to farmers by giving total control

over procurement, production and marketing. Amul and all other milk products

produced by cooperatives were born in struggle. It was the producers’ struggle for

command over the resources that they create, a struggle to obtain equitable returns

and a struggle for liberation from dependence on middlemen. It was a struggle

against exploitation. A refusal to be cowed down in the face of what others believed

to be the impossible.

Amul’s birth was thus a harbinger of the economic independence of our farmer

brethren. Amul’s mission was the development of farmers, nutrition to the nation,

and heart in heart, the real development of India.

Given India’s vast geographical spread, the country had very few dairy plants at the

time of independence. As the then Prime Minister Lal Bahadur Shastri had said, ‘One

Amul is not sufficient. Many Amuls are the need of the hour.’ This led to replication

of the Anand pattern through the Operation Flood programme which has, amongst

others, three major achievements to its credit, namely: making dairying India’s

largest self-sustainable rural employment programme, bringing India close to self-

sufficiency in milk production, and trebling the nation’s milk production within a

span of two and a half decades to make India the world’s largest milk producer.

Today, 173 milk producers cooperative unions and 22 federations play a major role

in meeting the demand for packed milk and milk products. Quality packed milk is

now available in more than 1,000 cities throughout the length and breadth of India.

And this is milk with a difference – pasteurized, packaged, branded, owned by

farmers – carrying the milk drop logo, like Amul, a symbol of quality.

Over the course of Operation Flood, milk has been transformed from a commodity

into a brand, from insufficient production to self-sufficient production, from

rationing to plentiful availability, from loose, unhygienic milk to milk that is pure

and sure, from subjugation to a symbol of farmer’s economic independence, to being

the consumer’s greatest insurance policy for good health.

What of the future? India’s population has risen from 350 million in 1950 to 1,000

million today. As cities draw people to new employment opportunities, the current

urban-rural ratio of 26:74 is likely to become 33:67 by the year 2010. As per

available projections, the population by the year 2010 would touch 1,190 million

people. This means that by the year 2010, rural India will be required to support

some 800 million people, an increase of 11% over 1999’s 720 million rural people.

 Based on the current population demographics and projections, we estimate that

there will be 260 million women in the age-group of 15-59 years in India by the year

2010 and this would further increase to 302 million by the year 2020, of which only

100 million would be literate. This means that rural women will comprise 21% of

India’s total population. In our country, most rural women contribute to agricultural

and dairying activities – apart from the household work – and their activities are not

included in India’s GDP despite their significant contribution. Dairying is, therefore,

very important to our rural women. For many, it is their main source of employment

and income, incomes that they often manage themselves.

Population gives us one picture. The other is provided by the demand for household

commodities. By 2010, the national requirement for food grains will touch 266

million metric ton, rising to 343 mmt by 2020. For milk, estimated consumption will

be 153 mmt by 2010 and 271 mmt by 2020. For edible oils, demand will soar to 9

mmt by 2010 and 13 mmt by 2020.

It should be clear that agriculture would remain the most important engine of our

economy. Amul and its cooperative sister brands are aware of this challenge. The

future, they say, is at best a mystery. But, it should be clear that the needs of a nation

on the move must be met. The country is young. There are more working women.

The needs of an ever-growing population have to be met with sustainable economic

development. And the demand for milk and milk products, therefore, is only going to

grow further. Couple this with the nutritional needs of the new and the old

generations and it is equally clear that there will be a need for more value added milk

products. This calls for production to be enhanced at even faster rate than it is at

present.

There is also something very special about milk, something which requires that any

brand for milk and milk products to act not simply as a seller, but as a trustee. Milk is

not a white good or a brown good. It is not something people save their entire lives in

order to buy – like a car, or a house. Milk is not a status symbol; rather it is the

symbol of nutrition. Milk is a nearly complete food, providing protein, vitamins,

minerals and other nutrients so essential to maintaining good health.

We realise the value of milk on the day the milkman does not bring it to our

doorstep, when our children have to go to school without it, when we go without our

daily cup of coffee or tea. And what would our lives be like without ghee, butter,

cheese, curd, lassi, chaas and the like. Milk is not only an ingredient in our favourite

recipes; it is an essential ingredient of life itself. And, by its very indispensable

nature, it has one of the biggest markets – a whopping 82 mmt at a very conservative

consumption of just 214 grams per day per person in India alone.

Our commitment to the producer, and our contract with the consumer are the reasons

we are confident that cooperative brands, like Amul, will have an even bigger role to

play in the next fifty years. Resources need to be deployed with a purpose and a

commitment to deliver better results. There is no limit for a marketing exercise then.

It must build India and its culture a second time round. An India, that is the land of

our dreams.

 

Amul

Formed in 1946, Amul has initiated the Dairy Cooperative movement in India and

formed an Apex Cooperative Organization, Gujarat Co-operative Milk Marketing

Federation Ltd. (GCMMF), jointly owned by some 2.1 million milk producers in

Gujarat, India. Its products, including milk powders, liquid milk, butter, ghee, cheese,

chocolate, ice cream and pizza are widely used throughout India and abroad and have

made Amul the largest food brand in India today with an annual turnover of some Rs.

23 Billion ($US 500 million) per annum.

The primary goal of Dr. V. Kurien, Chairman, GCMMF, has been to build a strong

Indian society economically through an innovative cooperative network, to provide

quality service and products to end-consumers and good returns to the farmer

members. Dr. Kurien states, "We have traversed a path that few have dared to. We are

continuing on a path that still fewer have the courage to follow. We must pursue a

path that even fewer can dream to pursue. Yet, we must. We hold in trust the aims and

aspirations of millions of our countrymen."

Information Technology has played a significant role in developing the Amul brand.

The logistics behind co-coordinating the collection of some 6 million liters of milk

per day from 10,755 separate Village Cooperative Societies throughout Gujarat and

then storing, processing and producing milk products at the respective 12 District

Dairy Unions, are awesome. The installation of 3000 Automatic Milk Collection

System Units (AMCUS) at Village Societies to capture member information, milk fat

content, volume collected and amount payable to each member has proved invaluable

in ensuring fairness and transparency throughout the whole Amul organisation.

In 1996 Amul was one of the first major organisations in India to have a website and

this has been used both to develop an intranet of Amul distributors as well as a cyber-

store for consumers, one of the first examples of e-commerce activity in India.

Amul and co-op

The CEO, Mr. B M Vyas, recently said that, "Amul is not a food company, it is an IT

company in the food business". In saying this he was recognizing that the most

efficient way of building links between milk producers and consumers so as to

provide the best returns for both is through IT innovation.

This is why Amul has embraced the ideas behind. Co-op with such enthusiasm. Not

only will the TLD enable consumers in India to recognize an established brand they

can trust online, it will enable Amul to begin trading competitively throughout the

world, reaching markets, which have hitherto been inaccessible.

The CIO, Mr. Subbarao Hegde said, "Information Technology is the most effective

tool we have in communicating with our members and the millions of consumers who

purchase Amul products throughout India every day. Co-op not only reflects the

cooperative values which shape our own organisation democratically dynamic, it will

also give us a vital business advantage as we seek to develop the Amul brand

throughout the world."

BRANDING AND ADVERTISING – AMUL

AMUL means "priceless" in Sanskrit. A quality control expert in Anand

suggested the brand name “Amul,” from the Sanskrit “Amoolya,”. Amul

products have been in use in millions of homes since 1946. Amul Butter, Amul

Milk Powder, Amul Ghee, Amulspray, Amul Cheese, Amul Chocolates, Amul

Shrikhand, Amul Ice cream, Nutramul, Amul Milk and Amulya have made

Amul a leading food brand in India. Today Amul is a symbol of many things....

Of high-quality products sold at reasonable prices.... Of the genesis of a vast

co-operative network.... Of the triumph of indigenous technology.... Of the

marketing savvy of a farmers' organisation.... And of a proven model for dairy

development.

50 years after it was first launched, Amul's sale figures have jumped from 1000

tonnes a year in 1966 to over 25,000 tonnes a year in 1997. No other brand

comes even close to it. It was all because a thumb-sized girl climbed on to the

hoardings and put a spell on the masses.

Bombay: Summer of 1967. A Charni Road flat. Mrs. Sheela Mane, a 28-year-

old housewife is out in the balcony drying clothes. From her second floor flat

she can see her neighbors on the road. There are other people too. The crowd

seems to be growing larger by the minute. Unable to curb her curiosity Sheela

Mane hurries down to see what all the commotion is about. She expects the

worst but can see no signs of an accident. It is her four-year-old who draws her

attention to the hoarding that has come up overnight. "It was the first Amul

hoarding that was put up in Mumbai," recalls Sheela Mane. " People loved it. I

remember it was our favourite topic of discussion for the next one week!

Everywhere we went somehow or the other the campaign always seemed to

crop up in our conversation."

Call her the Friday-to-Friday star. Round eyed, chubby cheeked, winking at

you, from strategically placed hoardings at many traffic lights. She is the Amul

moppet everyone loves to love (including prickly votaries of the Shiv Sena and

BJP). How often have we stopped, looked, chuckled at the Amul hoarding that

casts her sometime as the coy, shy Madhuri, a bold sensuous Urmila or simply

as herself, dressed in her little polka dotted dress and a red and white bow,

holding out her favourite packet of butter.

For 30 odd years the Utterly Butterly girl has managed to keep her fan

following intact. So much so that the ads are now ready to enter the Guinness

Book of World Records for being the longest running campaign ever. The

ultimate compliment to the butter came when a British company launched

butter and called it Utterly, Butterly, last year.

India looked forward to Amul's evocative humour. If the Naxalite movement

was the happening thing in Calcutta, Amul would be up there on the hoardings

saying, "Bread without Amul Butter, cholbe na cholbe na (won't do, won't do).

If there was an Indian Airlines strike Amul would be there again saying, Indian

Airlines Won't Fly Without Amul.

From the Sixties to the Nineties, the Amul, and their ads have come a long

way. Where does Amul's magic actually lie? Many believe that the charm lies

in the catchy lines. That we laugh because the humour is what anybody would

enjoy. They don't pander to your nationality or certain sentiments. It is pure

and simple, everyday fun.

AMUL'S SECRET OF SUCCESS

The system succeeded mainly because it provides an assured market at remunerative

prices for producers' milk besides acting as a channel to market the production

enhancement package. What's more, it does not disturb the agro-system of the

farmers. It also enables the consumer an access to high quality milk and milk

products. Contrary to the traditional system, when the profit of the business was

cornered by the middlemen, the system ensured that the profit goes to the

participants for their socio-economic upliftment and common good. Looking back on

the path traversed by Amul, the following features make it a pattern and model for

emulation elsewhere. Amul has been able to:

-- Produce an appropriate blend of the policy makers farmers board of management

and the professionals: each group appreciating its roles and limitations

-- Bring at the command of the rural milk producers the best of the technology and

harness its fruit for betterment

-- Provide a support system to the milk producers without disturbing their agro-

economic systems

-- Plough back the profits, by prudent use of men, material and machines, in the rural

sector for the common good and betterment of the member producers.

Even though, growing with time and on scale, it has remained with the smallest

producer members. In that sense, Amul is an example par excellence, of an

intervention for rural change.

The Union looks after policy formulation, processing and marketing of milk,

provision of technical inputs to enhance milk yield of animals, the artificial

insemination service, veterinary care, better feeds and the like - all through the

village societies.

Why is Amul successful today?

Verghese Kur i en

Amul is a name widely recognised and respected, not just in Indian cities and towns,

but in our villages as well.

Probably the easy, but nonetheless wrong, answer is that Amul has been advertised

well. Certainly it has helped that those responsible for keeping the Amul name in the

public eye have used considerable imagination and, campaigns like, ‘The taste of

India’ are nothing short of brilliant. However, there is much more to it.

A successful consumer product is the object of thousands, even tens of thousands of

transactions every day. In these transactions, the brand name serves in lieu of a

contract. It is the assurance to the buyer that her specifications will be met. It is the

seller’s assurance that quality is being provided at a fair price.

If Amul has become a successful brand – if, in the trade lingo, it enjoys brand equity –

then it is because it has honoured our contract with consumers for close to fifty years.

If it had failed to do so, then Amul would have been consigned to the dustbin of

history, along with thousands of other brands.

The tough part of the use of a brand as a contract is that every day is a renewal; if, just

once, the brand fails to meet the customer’s expectations or, more exactly, if it fails to

delight the customer, then the contract loses its value. If Amul’s sales continue to rise,

it is because that contract has been honoured, again and again. It would like to think

that the granddaughters of some of our first customers are now ‘contracting’ with it to

buy their butter, cheese, baby food, chocolates and other fine Amul products. It is also

a fact that when it first thought of exporting to West Asia and even to the United

States, it was because of the loyalty of Amul customers who, even when far from

home, still craved their ‘taste of India’.

What goes into the ‘contract’ that is a brand name? First is quality. No brand survives

long if its quality does not equal or exceed what the buyer expects. There simply can

be no compromise. That’s the essence of the contract. In the case of a food product,

this means that the brand must always represent the highest hygienic, bacteriological

and standards. It must taste good, and it must be good.

Second, the contract requires value for money. If our customer buys an Amul product,

she gets what she pays for, and more. Amul has always taken pride in the fact that

while it earns a good income for our owners – the dairy farmers of Gujarat – we don’t

do it at the cost of exploiting the consumer. Even when adverse conditions have

reduced supplies of products like butter, it has resisted the common practice of raising

prices, charging what the market would bear. Rather, it has kept prices fair and done

its best to ensure that retailers do not gain at the consumers’ expense.

 The third element of the contract is availability. A brand should be available when

and where the customer wants it. There is no benefit achieved in creating a positive

brand image, and then being unable to supply the customer who wants to buy it. In

Amul’s case, over the years it has built what is probably the nation’s finest

distribution network. it reaches hundreds of cities and towns through a cold chain that

not only ensures that products are available, but they reach the customer at the

farthest end of the country with the same quality as you would find in Ahmedabad or

Vadodara.

The fourth part of the contract is service. A commitment to total quality. But,

occasionally, it may make a mistake – or, its customer may think it has made a

mistake, and the customer, as they say, is always right. That is why, for Amul, every

customer complaint must be heard – not just listened to. And, every customer

complaint must be rectified to the extent humanly possible.

For close to fifty years now, Amul has honoured its contract with the consumer. The

contract that is symbolized by the Amul brand means quality. It means value for

money. It means availability. And it means service.

AMUL: KAPFERER PRISM

PICTURE OF SENDER

Amul

Physique: Taste, Quality

Relationship: sociable

Reflection: Value Oriented

Self-image: proud Indian, Fun loving

Culture: Co-operative, sharing

Personality: Simple, Indian

PICTURE OF RECIPIENT

INDUSTRY ANALYSIS FOR CHOCOLATES SECTOR

Major Players in chocolate market

Chocolates:

Cadbury is the market leader in all categories with over 65% market share. Its main

competitor is Nestle India. Nestle has identified chocolate and confectionery as one of

the thrust areas for growth. It has launched some of its international brands like

Quality Street, After Eight, Lions in India. In 1998, Cadbury launched a new count

bar Picnic. Nestle immediately followed it with the launch of Charge. Gujarat Co-

operative Milk Marketing Federation (GCMMF) and Central Arecanut and Cocoa

Manufactures and Processors Co-operative (CAMPCO) are other two significant

players. Both are local manufacturers. Distribution, in the case of chocolates, is a

major deterrent to new entrants as the product has to be kept cool in summer and also

has to be adapted to suit local tropical conditions. With removal of QRs all the major

international chocolate brands specially Swiss brands would become freely available

in the market.

Market Share:

Moulded segment Count segment Eclairs

Cadbury 70% Cadbury 76% Cadbury 49%

Nestle 23% Nestle 20% Nutrine 37%

GCMMF 5% Campco 3% Nestle 12%

Others 2% Others 1% Parry's 1%

Products And Segmentation:

Chocolate market can be segmented as follows:

Large units bars/ slabs,

Count lines,

Panned varieties,

Small value added units.

Confectionery products can be categorized as

Hard boiled sugar candies, lollipops, jellies

Toffees

Chewing candies

Breath freshners, digestives, throat relievers

Gum based products are

Chewing gum

Bubble gum

Chocolates and Confectionery Industry

Chocolates

Bars/ Slabs

Count lines

Panned (Gems)

Eclairs

Assorted

Sugar confectionery

Hard boiled

Toffees

Soft chew

Jelly candies

Deposit candies

Lollipops

Mints

Lozenges

Breath freshners, etc

Gum based

Chewing gum

Sugar coated chewing gum

Bubble gum

Consumer Habits And Practices:

-- Chocolates are consumed as indulgence and not as snack food, as prevalent in

western countries. Almost 75% chocolates and 90% confectionery are impulse

purchases.

-- Chocolates are bought predominantly by adults and gifted to children. Direct

consumption by adults has also increased.

-- In contrast, over 90% of confectionery products are purchased by children between

the age of 6 and 14, directly. In most cases, parents do not approve of confectionery

consumption, and children buy out of their pocket money.

-- Chocolate consumption is concentrated largely in metropolitan cities.

Confectionery consumption is wide spread. The unorganized sector has a greater

dominance in rural areas.

-- Confectionery consumption has a seasonal pattern. Sales peak in winter months

from November to February. Off-take is lowest in the summer months as schools are

closed and therefore children's pocket money is lower. Also in monsoon consumption

falls as children are out of home for lesser time. Between February and April pressure

of examinations causes lower sales.

-- Brand loyalties are weak in confectionery products. Children look for novelty and

excitement. Most purchases are impulse driven and POP retail displays (dispensers,

etc) play an important role. Promotions such as stickers, cricketer/ star pictures have

tremendous impact.

-- Cross elasticity of demand - Different products amongst confectionery such as hard

boiled sugar candy, bubble gum etc compete inter se and also with ice cream and

chocolates.

-- Confectionery market is extremely price sensitive. In India, 50 paise unit price has

been the largest segment, followed by 25 paise segment. Re1 is considered premium

pricing. When raw material prices escalate, marketers find it difficult to pass on the

same due to problems of coinage, as price increase has to be in steps of 25 paise.

-- Chewing gum consumption faces a major problem of disposal, as the gum residue

has a tendency to stick. To keep public places clean, some countries like Singapore

have banned use of gum based confectionery. Consumption of chewing gum is

significantly higher in the Western countries.

-- Bubble gums are consumed by children whereas chewing gums by teenagers and

adults.

-- In India, consumption of chewing gum has been very low due to non-availability of

superior quality products till a few years ago. During the last few years, market for

bubble gum has exploded. It is expected that similar growth would be witnessed in

chewing gum as the current generation grows up with the habit of gum chewing.

-- Grown up adults feel guilty about eating chocolate, akin to stealing a child's food

Segmentation:

Chocolate market can be segmented into moulded chocolates, count

chocolates, panned chocolates, eclairs and assorted chocolates.

Type of chocolates % share in chocolate market

Moulded 37%

Count 30%

Eclairs 20%

Panned 10%

Others 3%

Moulded chocolates, like Dairy Milk, Truffle, Amul Milk Chocolate, Nestle

Premium, Nestle Milky Bar, is the largest segment accounting for more than 1/3rd of

the market.

Count lines (5 Star, Perk, Kitkat, Picnic) is the second largest segment accounting for

30% of the volumes. The Count line segment has been growing at a faster pace during

the last three years driven by growth in Perk and KitKat volumes.

Panned products include Cadburys' Gems, Nutties, and Nestle's Marbles. In panned

segment, Cadbury dominates with over 95% market share.

Eclairs (droplets of hard caramels with a soft chocolate fillings) is a low unit priced

product. Cadbury Eclairs was launched in 1972. Parle Products launched Melody in

1991. Nestle is a recent entrant in the segment. Nutrine's Eclairs has done extremely

well in the market.

Industry Backdrop:

Indian chocolate market grew at the rate of 10% pa in 70's and 80's, driven mainly by

the children segment.

In the late 80's, when the market started stagnating, Cadbury repositioned its Dairy

Milk to any time product rather than an occasional luxury. Its advertisement focused

on adults rather than children. Cadbury's Five Star, the first count chocolate, was

launched in 1968. Due to its resistance to temperature, the chocolate has become one

of the most widely distributed chocolate in the country. Other competing brands such

as GCMMF's Badam bar and Nestle's Bar One have minor market shares.

In the early 90's, high cocoa prices compelled manufacturers to raise product prices

and reduce their advertisement budget affecting the volumes significantly. The launch

of wafer chocolates Kit Kat and Perk spurred volume growth in the mid 90's. These

chocolates positioned as snack food rather than on the indulgence platform compete

with biscuits and wafers.

Market Size And Growth:

The current market size of chocolate is estimated to be 22,000 ton pa, valued at

Rs3.5bn. Volume growth which was over 20% pa in the last 3 years, slowed down in

1997-98. The market leader Cadbury's volumes were stagnant at around 11400 ton.

COMPETITOR ANALYSIS FOR CHOCOLATE INDUSTRY

Cadbury, a subsidiary of Cadbury Schweppes is a dominating player in the Indian

chocolate market with strong brands like Dairy Milk, Five Star, Perk, Gems etc. Dairy

milk is the largest chocolate brand in India. Chocolates & Confectionery contribute to

75% of Cadbury’s turnover. Cadbury also has a strong brand Bournvita in the malted

health drink category, which accounts for 24% of turnover. The parent Cadbury

Schweppes during 2001 made an open offer for acquiring the 49% non-promoter

holding in the company. It has already acquired over 90% of the equity and proposes

to buy back the balance equity and delist the stock from Indian bourses.

Nestle India Ltd:

51% subsidiary of Nestle SA is among the leading branded food player in the country.

It has a broad based presence in the foods sector with leading market shares in instant

coffee, infant foods, milk products and noodles. It has also strengthened its presence

in chocolates, confectioneries and other semi processed food products during the last

few years. The company has launched Dairy Products like UHT Milk, Butter and

Curd and also ventured into the mineral water segment in 2001. Nestle’s leading

brands include Cerelac, Nestum, Nescafe, Maggie, Kitkat, Munch and Pure Life.

Nestle registered robust profit growth of 46% yoy to Rs1.73bn in F12/01. Profit

would have been higher but for the additional costs associated with the new

businesses of water, liquid milk and chilled dairy products. Sales rose by 14.5% yoy

to Rs19.21bn. Domestic sales grew by 14.1% yoy to Rs16.11bn. Exports, contributing

16% to turnover, increased by 16.7% yoy to Rs3.1bn. 74% of the exports continue to

be to its key market – Russia. The company has also reported a strong 55% yoy

growth in net profit in Q1 F12/02. Sales have registered a 17.4% yoy growth mainly

driven by higher domestic sales in the chocolate and culinary product segments.

Nestle has introduced a new confectionery - Nestle Choco Stick at an affordable price

point of Rs2, a soft chewy fudge Milkybar Choo.

OBJECTIVES OF THE RESEARCH

Gujarat Co-operative Milk Marketing Federation is the undisputed market leader in

the dairy segment. Amul then made its foray into the ice cream market and has

emerged as a leader in this segment too. Today, Amul boasts of having the highest

sales in the ice cream segment. However, it is not known whether teenagers perceive

Amul as the No 1 brand in the market. Hence a need to conduct a study to know the

perception of teenagers towards Amul’s ice creams was felt and a comparative study

of perception towards competitors brand was carried out.

Also gaps between the consumer’s expectations and the services provided by the

company were estimated.

RESEARCH METHODOLOGY

Methodology for conducting the research on this project was desk research and field

survey.

Desk research was used to analyze secondary data collection.

Field survey was then conducted to gather primary data collection from the target

respondent.

Information required:

Consumption patterns and the perception towards the brand of the target

audience i.e. the teenagers in Mumbai.

The consumers selected were evenly distributed throughout the survey population.

Assumptions:

Sample collected from Mumbai is a representative of the population.

Data collection methods:

Both primary and secondary data was used for the purpose of collection of data.

Primary Data Sources:

The primary data collection was done by means of a structured questionnaire and was

executed by way of personal interviews with consumers.

Secondary data Sources:

Secondary data collection was from sources like:

Research executive briefings

Websites, newspapers and literatures

Sample studied:

A Quantitative research technique was used which was based on conducting one to

one interviews by means of a structured questionnaire.

Respondents:

Interviews were conducted with teenagers ( 13 yrs – 19 yrs) in the city of Mumbai.

Sample Size:

A total of 128 teenagers were interviewed during the survey.

RECOMMENDATIONS

Increase the Awareness for the chocolate Nuts ‘bout U through advertising,

POP’s and Hoardings.

To Alter the Packaging of the chocolate and to sell in a rectangular box

without the heart-shaped cover.

To change the colour of the packaging in order to make it more attractive.

To retain the heart-shaped cover during special occasions like Valentines

week, Diwali, etc. as maximum gifts are given during such occasions.

To change the base of the chocolate as the respondents were dissatisfied with

the milky taste.

To improve the distribution of the chocolate so that it is available easily.

ANNEXURE

Chocolate survey

Respondent profile Respondent name: ________________________________________________Age: _________ Tel no: ______________Residence Address __________________________________________________________________________ College of education _______________ Educational Qualification____________

1. Name any new brand of chocolate in the market

Brand name 1: ___________ Brand name 2: ___________ Brand name 3:

___________ Brand name 4___________

2. Have you heard about a new brand of chocolate from Amul in the market?

Yes

No

Maybe

[If yes, proceed, If no. go to Qs.4]

3. What is the new chocolate brand from Amul called?

______________________________________________

4. Have you heard about Nuts Bout U?

Yes

No

[If no proceed, if yes, go to Qs.8]

5. Are you aware that Amul has come out with a new brand of chocolate called Nuts

Bout u?

Yes

No

[If no, proceed and terminate at Qs.7, if yes go to Qs.8]

6. What do you think about this sample pack of Nuts Bout U? (Expose sample

pack-note spontaneous response)

__________________________________________________________________

________________________

7. A) Would you consider trying it if you saw it in a shop (price Rs.40 for 80 gms)?

(force choice here)

Definitely yes

Probably yes

Probably no

Definitely no

B) Why?

If definitely or probably yes, why?

Good packaging

Seems like a good tasting, premium chocolate

Good for gifting purpose

Any

other______________________________________________________________

________________

If definitely or probably no, why not?

Packaging is too gaudy (heart shaped)

Is not really worth the price / too little chocolate for the price

Don't think the taste will be good / don't like apricot kernels

Any

other______________________________________________________________

________________

8. Where did you hear about Nuts Bout U?

Advertisement on TV/newspaper *********** (if selects this option administer

additional questions in box, at the end)

Saw it in a retail shop

Saw it in gift shop

Shopkeeper / retailer told me about it

Friends told me about it

Any other

__________________________________________________________________

9. What do you know about the chocolate Nuts Bout U?

Chocolate with apricot kernel nuts

Heart shaped chocolate

Premium chocolate for gifting

Any other

___________________________________________________________________

10. Have you ever bought it?

Yes

No

[If yes, go to Qs.12, If no, proceed to Qs.11]

11. Why did you not consider buying it?

Didn't like the packaging

Not economical, over-priced

It is more for gifting, not regular buying

Any other

______________________________________________________________

12. Have you tried it?

Yes

No

[If yes proceed, if no, offer the chocolate for trial here to respondent to allow

sampling]

13. What did you think of it? (Note spontaneous)

__________________________________________________________________

__________________________________________________________________

________________________________________________

14. Rate the following chocolate brands on a scale of 1-10 (if 1 is lowest and 10 is

highest)

BIBLIOGRAPHY

Cadbury

Temptations

Cadbury

Dairy Milk

Amul Nuts

Bout U

Nestle

Classic

Amul Milk

chocolate

****************1. What was the message conveyed by the TV advertisement? (Note spontaneous)

___________________________________________________________________________________________

2. Which of the following best describe the message? Chocolate for Valentine day Chocolate that is Full of Nuts, full of love Apricot titbits chocolate Chocolate for youngsters who are in love

3. Did you like the ad? (Rate on a scale of 1-10 if 1 was least and 10 the highest) ________________________

BIBLIOGRAPHY

www.amul.com

www.indiainfoline.com

www.blonnet.com

Creating Brand Building Advertising

Marketing Management

www.hinduonline.com