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1 INTRODUCTION
In the challenging and competitive industry like cigarette there is a need for continuous
monitoring of the happenings in the market. Ignoring or slowing down the pace will allow the
competitor to take the advantage and grab the market. Various brands Godfrey Phillip, VST,
Kothari product, Golden tobacco already exist in the market and are waiting for a chance to grab
the market share ITC cigarettes which is leader as of now.
There is need for every organization to be more responsive towards market and should be
quickly adapt the changes in the environment. Measures should be taken to increase revenue.
Schemes should be launched to attract customers and increase customer base.
Relationship with distributors and outlets should be maintained for the smooth flow of
products. Schemes which are to introduced should be tested by launching on a small scale and
should be extended. Validation of sales and market should be exercised by conducting audit
reports. Audit report should be re-checked by getting it done by various parties inside and
outside of the organization which include employees, third parties.
1.1 SUPER PREMIUM AND MODERN VARIANT OUTLETS
Considering the factors like sales volume and brand availability ITC categorized the outlets into
3 types.
1) Super premium
2) Modern variant
3) Normal
Super premium
For an outlet to be under this category, it should have five premium brands available in the outlet
and there should be a sale of greater than or equal to 70 sticks per day.
Modern variant
For an outlet to be in this category, it should have a minimum of three king size filter brands
available and there should a sale of more than 120 sticks per day. All the remaining outlets are
treated as normal outlets.
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1.2 SCHEMES
CLUB ROYALE
It is one of the new schemes launched by ITC tobacco division. The main aim behind
introducing this scheme is to increase its stagnated sales and revenue from cigarettes thereby
increasing its overall revenue. ITC captured major market share in cigarette industry by
introducing new variants in the existing brands in a timely manner.
Club Royale scheme is introduced in Hyderabad for the first time in India. Recently it
extended this scheme to Pune. Based on the results of this scheme to increase sale and customer
base ITC is in a plan to extend this scheme to other regions in India. This scheme is given only to
all the super premium and modern variant outlets in Hyderabad. Both pull and push process is
observed in introducing this scheme to outlets.
This scheme focuses on 3 aspects
1) Availability
2) Arrangement
3) Merchandising
Availability:
All these outlets which are under this scheme should have all the cigarette brands of ITC
in the outlet, failing which will reduce the club royale points to that outlet
Arrangement:
All the outlets under this scheme should not sell any other brand’s cigarettes other than
ITC’s products. Violating this will lead to decrease in the club royale points.
Merchandising:
In merchandising aspect the factors considered are maintenance of retail architecture, on
shop board, modular display, in shop board and shelving.
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BENEFITS TO THE OUTLETS FROM THIS SCHEME
When an outlet is under this scheme
ITC will build retail architecture to the outlet.
On shop ad board will be given.
Modular display is provided
Shelving is done inside the outlet.
It will get an image like an ITC acquired outlet though it is not in real.
Money to maintain the outlet will be given on a monthly basis.
Distribution of maintenance money for each factor:
Initially minimum maintenance money of Rs 800 will be offered and a final amount is
fixed after bargaining taking the location and importance of the outlet into consideration.
In 1000 rupees maintenance given by ITC
20% i.e., Rs 200 will be for availability factor
20 % i.e., Rs 200 will be for arrangement factor
40% i.e., Rs 400 will for merchandising factor
Audit report will be done on a regular basis and if any of the factor is getting violated, then
money corresponding to it will not be given and points will be reduced.
EXPECTATIONS OF ITC FROM OUTLETS
Increase the sales.
Increase availability of ITC brand cigarettes.
Competitor brands should not be available in the outlet.
Good maintenance of the outlet.
Promote other products like soaps, biscuits, shampoos, incense sticks and confectionery
in the outlet
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OTHER SCHEMES
In order to promote re-cycling and also to get the advantage of proof of sale ITC introduced a
scheme on few brands. When empty packets of the brands on which the scheme is applicable are
given to the salesman, petty items like match box are given as an exchange.
1.3 NEED FOR THE STUDY
In cigarette industry there exists thin difference between the products of various
companies. So, it is necessary to show the possible product differentiation. One of the ways to
implement it is by launching schemes and providing benefits. The next challenge would be
verifyning the success level in implementation in order to extend its implementation and to
move further.
1.4 OBJECTIVES
PRIMARY OBJECTIVE:
The primary objective of the study is to understand and validate the pre-requisites of
being a super premium and modern variant outlets.
SECONDARY OBJECTIVES:The secondary objectives are:
To survey the availability of various cigarette brands of ITC in the new outlets.
To survey the presence of competitors brands (if there are any) in the new outlets.
To check implementation of various merchandising methods in the new outlet.
1.5 SCOPE OF THE STUDY:The scope of the study is:
Limited to Hyderabad region.
Limited to newly add super premium and modern variant outlets of ITC.
Limited to cigarette industry only.
Limited to 8 weeks.
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1.6 INDUSTRY PROFILEHISTORICAL OVERVIEW OF TOBACCO IN INDIA
The history of global tobacco trade is integrally linked with the history of India. It was to
discover a sea route to this fabled land, reputed for its spices, silk and gems, that Christopher
Columbus set sail in 1492. His wayward journey took him instead to America. This discovery of
the New World was accompanied by the discovery of tobacco by Portuguese sailors. This plant,
treasured by the American ‘Indians’ for its presumed medicinal and obvious stimulant properties,
was eagerly embraced by the Portuguese who then moved it to the Old World of Europe. Even
though their quest for easy access to Indian spices was delayed by some years, the Europeans did
not fail to recognize the commercial value of this new botanical acquisition. When the
Portuguese eventually did land on Indian shores, they brought in tobacco. They introduced it
initially in the royal courts where it soon found favors. It became a valuable commodity of barter
trade, being used by the Portuguese for purchasing Indian textiles.
The taste for tobacco, first acquired by the Indian royals, soon spread to the commoners
and, in the seventeenth century, tobacco began to take firm roots in India. Thus, tobacco
travelled to the real Indians from their curiously named American cousins, through the medium
of European mariners and merchants who sailed the seas and spanned the continents in search of
new markets and colonies. It was with the establishment of British colonial rule, however, that
the commercial dimensions of India’s tobacco production and consumption grew to be greatly
magnified.
Initially, the British traders imported American tobacco into India to finance the
purchase of Indian commodities. When the American colonies declared independence in 1776,
the British East India Company began growing tobacco in India as a cash crop. Attempts were
made, under the colonial rule, both to increase the land under tobacco cultivation and to enhance
the quality of the leaves produced. The British East India Company and its successor, the British
Raj, used tobacco as an important cash crop, both for domestic consumption and foreign trade.
The manufacturing industry was, however, not established till much later, as the British believed
in exporting the leaf to Britain and re-importing cigarettes to India, with considerable value
addition in the process. As domestic consumption of cigarettes rose, the Imperial Tobacco
Company commenced production within India, retaining control and repatriating the profits. In
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the late nineteenth century, the beedi industry began to grow in India. The oldest beedi
manufacturing firm was established around 1887 and by 1930 the beedi industry had spread
across the country. The price differential from cigarettes favored the use of beedis by the
working classes and this domestic product soon supplanted cigarettes as the major form of
tobacco consumption. The tax policies adopted by the Indian Government after Independence
also favored the beedi in comparison to cigarettes. This further fostered a growth in beedi
consumption.
While tobacco chewing was practiced for many centuries, commercial production and
marketing have been markedly up scaled recently, with the introduction of the gutka. The rate of
growth of consumption of gutka has overtaken that of smoking forms of tobacco. As a result,
oral tobacco consumption has opened a new and broader front in the battle between commercial
tobacco and public health in India. The economics of tobacco, which introduced it into India and
entrenched it during the colonial rule, also provided a compelling reason for continued state
patronage to the tobacco trade, even in free India. The ready revenues that bolster the annual
budgets, the ability to export to a tobacco-hungry world market and the employment
opportunities offered to millions provided the rationale for encouraging tobacco, both as a crop
and as an industry.
While economics may have been the principal force propelling the seemingly inexorable
advance of tobacco in India, there are also a multitude of social and cultural factors which need
to be recognized, so that the variations in its use across social, religious and ethnic subgroups can
be comprehended. Such factors have operated since the time tobacco entered India, though the
nature of the socio-cultural determinants that influence individual and community responses to
tobacco may have varied over time, region, religious denomination and social class. It is this
tapestry of international linkages, powerful economic factors and distinctive cultural influences
which make the history of tobacco in India a fascinating study.
TOBACCO INDUSTRY TODAY
Tobacco occupies a prime place in the Indian economy on account of its considerable
contribution to the agricultural, industrial and export sectors. India is the second largest producer
of tobacco in the world. China and the USA rank first and third, respectively, in terms of tobacco
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cultivation. Brazil, Turkey, Zimbabwe, Malawi, Italy and Greece are the other major tobacco
producing countries. Tobacco contributes substantially to the economies of these countries. In
2000–2001, the contribution of tobacco to the Indian economy was to the extent of Rs 81,820
million, which accounted for about 12% of the total excise collections. Foreign exchange
earnings during the same period were Rs 9030 million, accounting for 4% of India’s total
agricultural exports. Endowed with favorable agro-climatic attributes such as fertile soil, rainfall
and ample sunshine, India has the potential of producing different varieties of tobacco with
varied flavors.
Recent Trends in Indian tobacco Market
Continuing with a policy to control smoking, the tax measures became harsher in 2007, with an
increase of 6% in excise and an additional 12.5% in VAT, bringing the total effective tax to
about 20% (although the most populous state, Uttar Pradesh, imposed 32.5% VAT). As
expected, volume sales declined due to the subsequent price rises. ITC Group, the leading
company, is estimated to have taken price hikes as high as 20% on some brands. The industry
expected a volume decline of 5%-10%, but the overall industry declines have been lower than
expected, reflecting consumer resilience to price rises.
Cigarettes – so many challenges
The government has put severe regulatory restrictions of all types on cigarettes to restrict sales
and reduce smoking prevalence. Apart from consistent rises in taxes each year on cigarettes,
there is also a total ban on advertising and promotion, a ban on smoking in public, and also in
films, a ban on sale to minors, and there are impending graphic health warnings on packs in
2008. Moreover, the domestic industry also faces threats from imports and smuggled cigarettes.
Although imports constitute only a negligible proportion of the domestic pie, their rising share
poses a threat to players.
Graphic pack warnings – finally implemented by mid 2008
Under the provisions of the Cigarettes and Other Tobacco Products (Prohibition of
Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution)
Act, 2003, (COTPA) and rules 2006, companies will have to display pictures of the potential
health dangers of smoking cigarettes, such as oral cancer and lung cancer. This is a powerful
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measure which will have a strong downward effect on volume sales. The rule was proposed in
2006, but was strongly resisted by the cigarette lobby, and is currently being reviewed by the
government once again. Preliminary decisions to implement the pack warnings were finalized in
February 2008, and only the final details on the pictures to be used are being discussed; final
rules are expected to be announced soon. The industry is fearful that this may have a negative
impact on volume sales.
Despite regulatory controls, underlying factors for cigarette growth are strong
Despite all the regulations, cigarettes in India continued to see small growth in the past five years
(except in 2007 when it declined). While FY08 is expected to see declines due to the unusually
high taxes in 2007, it is expected to rebound in FY09 due to strong long term core factors. India
is demographically very attractive. 65% of the population is below the age of 35; potentially this
is a big segment of younger consumers with rising disposable incomes and a lower aversion to
smoking. Moreover, India has a low per capita cigarette consumption (141 sticks) compared with
the global average. Players are optimistic about these favorable demographics and growing
income trend.
Cigar culture grows
Cigars are still a nascent category in India, but rapidly growing. Cuban cigars have become the
trendiest prop for politicians, businessmen and even young society men and women as the hottest
object to flaunt. Within the premium segment Cohiba and Partagás dominate, while Phillies is
the most popular mid-priced brand. Cigar lounges have spread rapidly in all leading cities in five
star hotels and up-market bars and pubs, and these offer select membership and provide elite
personalized services to their members. Key names include Le Royal Meridien in Mumbai
(‘Cigar Divan’), Leela Hotel in Bangalore (‘Cigar Room’) Taj Residency’s Café Mosaic and
Cohiba Club.
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1.7 COMPANY PROFILE
QUICK VIEW
Source: http://en.wikipedia.org/wiki/ITC_Limited
VISION STATEMENT
Sustain ITC's position as one of India's most valuable corporations through world class
performance, creating growing value for the Indian economy and the Company’s stakeholders.
MISSION STATEMENT
To enhance the wealth generating capability of the enterprise in a globalizing environment,
delivering superior and sustainable stakeholder value
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POSITIONING STATEMENT
"Enduring Value. For the nation. For the Shareholder."
ITC Limited which previously stood for Imperial Tobacco Company of India Limited
is an Indian conglomerate ITC is one of India's foremost private sector companies with a market
capitalization of nearly US $ 14 billion and a turnover of over US $ 5 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 is one of India's most valuable and respected corporations.
ITC employs over 25,000 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 3, 53,000 shareholders.
Its businesses and brands are focused almost entirely on the Indian markets, and despite
being most well-known for its tobacco brands such as Gold Flake, the business is now
diversifying into new FMCG (Fast Moving Consumer Goods) brands in a number of market
sectors - including cigarettes, hotels, paper, agriculture, packaged foods and confectionary,
branded apparel, personal care, greetings cards, Information Technology, safety matches, incense
sticks and stationery.
The company is currently headed by Yogesh Chander Deveshwar. It employs over
20,000 people at more than 60 locations across India and is listed on Forbes 2000. The Training
Centre of the company is in Munger, Bihar. ITC is also known as "Chatkal" (especially in
Munger).
ITC enjoys the leadership position in the Indian cigarette market with a market share of
~80% in terms of value. Cigarettes contribute close to 65% of ITC’s total gross revenues
however owing to the high incidence of taxes, this segment amounts to ~50% of the revenue on a
net basis. FMCG others segment has gradually increased its contribution over the years and is
expected to be a major growth driver in the coming years.
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ITC’s CORPORATE STRATEGIES
• Create multiple drivers of growth by developing a portfolio of world class businesses that
best matches organizational capability with opportunities in domestic and export markets.
• Continue to focus on the chosen portfolio of FMCG, Hotels, Paper, Paperboards &
Packaging, Agri Business and Information Technology.
• Benchmark the health of each business comprehensively across the criteria of Market
Standing, Profitability and Internal Vitality.
• Ensure that each of its businesses is world class and internationally competitive.
• Enhance the competitive power of the portfolio through synergies derived by blending
the diverse skills and capabilities’ residing in ITC’s various businesses.
• Create distributed leadership within the organization by nurturing talented and focused
top management teams for each of the businesses.
• Continuously strengthen and refine Corporate Governance processes and systems to
catalyze the entrepreneurial energies of management by striking the golden balance between
executive freedom and the need for effective control and accountability.
List of products & brands:
ITC has a diversified presence in different sectors. They are mentioned below-
TABLE-1
Sectors Brands/ Companies/ Products
Cigarettes Wills, Gold Flake, Navy Cut, Insignia, India
Kings, Classic Verve, Classic, Silk Cut,
Scissors, Capstan, Berkeley, Bristol and
Flake.
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Hotels ITC Welcome group Hotels, Palaces and
Resorts is India's second largest hotel chain
with over 80 hotels. Based out of Hotels
Division Headquarters at the ITC Green
Centre in Gurgaon, ITC Welcomgroup is also
the exclusive franchisee of The Luxury
Collection brand of Starwood Hotels and
Resorts in India .
Paperboards & Specialty Papers ITC Bhadrachalam Paperboards Limited &
ITC Tribeni Tissues Division are now under
one roof . Paper Boards and Specialty Papers
Division. There are 4 Units under one
umbrella - Bhadrachalam, Tribeni, Bollarum
and Kovai.ITC PSPD
Packaging & Printing Business India's Largest Packaging Solution provider
with In-house film manufacturing capability.
Multi-location manufacturing facilities to
cater to domestic and export requirements.
Product Range includes Cartons (Folding &
Fluted), Flexibles (Reels & Pouches),
Shoulder Box, HL's & CBO, Printed Cork
Tipping, Gay wraps. ITC PPB .
Agricultural Industry Agri-Business, Leaf Tobacco, Gold Ribbon,
Blue Ribbon, Aqua Kings, Aqua Bay, Aqua
Feast and Peninsular.
Packaged Foods & Confectionery Kitchens of India, Aashirvaad, Sunfeast,
Mint-O, Candyman, Bingo Snacks.
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Branded Apparel Wills Lifestyle, John Players, Miss Players
Toiletries Essenza Di Wills, Fiama Di Wills, Superia,
Vivel Di Wills, Vivel
Education & Stationery Products Expressions,Classmate, Paperkraft
Information Technology ITC InfoTech
Safety Matches
iKno,
Mangaldeep, VaxLit, Delite(Discontinued)
and Aim Brands acquired from Wimco India
Match Company): Ship , Homelite (Swedish
Matches)
Incense Sticks Mangaldeep, Spriha,Yantra
While ITC continues in its traditional businesses of Cigarettes, Hotels, Paperboards, Packaging
and Agri-Exports, it is gaining market share in its nascent businesses of Packaged Foods &
Confectionery, Branded Apparel and Greeting Cards.
ITC's wholly owned Information Technology subsidiary, ITC Infotech India Limited, is pursuing
emerging opportunities in providing end-to-end IT solutions, including e-enabled services and
business process outsourcing.
THE MICRO-ENVIRONMENTThis environment influences the organization directly. It includes suppliers that deal directly or
indirectly, consumers and customers, and other local stakeholders. Micro tends to suggest small,
but this can be misleading. In this context, micro describes the relationship between firms and
the driving forces that control this relationship. It is a more local relationship, and the firm may
exercise a degree of influence.
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Stakeholders: As organization requires greater inward investment for growth they face
increasing pressure to move from private ownership to public. However this movement
unleashes the forces of shareholder pressure on the strategy of organizations. Satisfying
shareholder needs may result in a change in tactics employed by an organization. The Company
sees no conflict between the twin goals of shareholder value enhancement and societal value
creation. The challenge lies in fashioning a corporate strategy that enables realization of these
goals in a mutually reinforcing and synergistic manner. 244,65,39,845 Ordinary Shares of the
Company, representing 64.79% of the Company's paid up capital, as on 11th September, 2009
are in dematerialized form. The paid-up share capital of the Company is Rs. 377, 62, 86,590
(Rs.377.63 corers) divided into 377, 62, 86,590 Ordinary Shares of the face value of Re 1/- each.
Supplier: Raw materials, intermediates and the final product sourcing/distribution in widespread
across the country. Few items have more than 1 supplier for the raw material e.g. filter rods can
be sourced from Mumbai, Bangalore or Devas in MP. Huge supply-demand network for
cigarette business, which must operate in the cost optimal way to maximize the profits. Few
segments are particular to factories e.g. King size.
Consumer: Organizations survive on the basis of meeting the needs, wants and providing
benefits for their customers. Failure to do so will result in a failed business strategy. Its
businesses and brands are focused almost entirely on the Indian markets, and despite being most
well-known for its tobacco brands such as Gold Flake, the business is now diversifying into new
FMCG (Fast Moving Consumer Goods) brands in a number of market sectors.
THE MACRO-ENVIRONMENT
This includes all factors that can influence and organization, but that are out of their direct
control. A company does not generally influence any laws (although it is accepted that they
could lobby or be part of a trade organization). It is continuously changing, and the company
needs to be flexible to adapt. There may be aggressive competition and rivalry in a market.
Globalization means that there is always the threat of substitute products and new entrants. The
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wider environment is also ever changing, and the marketer needs to compensate for changes in
culture, politics, economics and technology.
Economic Factors: Marketers need to consider the state of a trading economy in the short and
long-terms. This is especially true when planning for international marketing. India has been one
of the best performers in the world economy in recent years, but rapidly rising inflation and the
complexities of running the world’s biggest democracy are proving challenging. India’s
economy has been one of the stars of global economics in recent years, growing 9.2% in 2007
and 9.6% in 2006. Growth had been supported by markets reforms, huge inflows of FDI, rising
foreign exchange reserves, both an IT and real estate boom, and a flourishing capital market.
Socio-Cultural Factors: The social and cultural influences on business vary from country to
country. It is very important that such factors are considered Envisioning a larger societal
purpose has always been a hallmark of ITC. Following are the factor which should be kept in
mind while doing business in India:
1. India, being a multi-cultural and multi-religious society, celebrates holidays and festivals of
various religions
2. India is one of the most religiously diverse nations in the world, with some of the most deeply
religious societies and cultures. Religion still plays a central and definitive role in the life of most
of its people.
3. The demographics of India is remarkably diverse. India's population of approximately 1.17
billion people (estimate for July, 2009) consists of approximately one-sixth of the world's
population
4. India is a young country with an average age between 23-24 years.
As a corporate citizen with enduring relationships in rural India, ITC has a history of
collaboration with communities and government institutions to enhance farm productivity and
the rural resource base. ITC’s commitments in agricultural R&D and knowledge sharing have
spanned vital aspects of competitiveness – efficient farm practices, soil and water management.
Technology factor: Technology is vital for competitive advantage, and is a major driver of
globalization. Technology in India accounts for a substantial part of the country's GDP and
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export earnings while providing employment to a significant number of its tertiary sector
workforce. Technically proficient immigrants from India sought jobs in the western world from
the 1950s onwards as India's education system produced more engineers than its industry could
absorb. India’s growing stature in the information age enabled it to form close ties with both the
United States of America and the European Union
IT plays a very critical role in driving the ITC business strategies.
IT is an enabler of the business process to ensure business growth through efficient
Management of operations in the value chain.
IT creates new business process or restructure the current business process to enhance
customer service availability ,efficient manufacturing / supply chain operations etc
Political factors: The political arena has a huge influence upon the regulation of businesses, and
the spending power of consumers and other businesses. The Indian polity is increasingly seen by
political observers as the problem. When populist political appeals stir the passions of the
masses, government institutions appear less capable than ever before of accommodating conflicts
in a society mobilized along competing ethnic and religious lines
Budget impact: Among the FMCG stocks Marico and ITC are the biggest gainers.
Marico has added 7.3% to Rs 77. ITC has surged 7% to Rs 212, after no change in excise
cuts on cigarettes
Due to Govt. new conditions ITC Maurya winning the 'Best eco-friendly hotel – Special
Prize' award by the Ministry of Tourism, Government of India.
THE INTERNAL ENVIRONMENT
All factors that are internal to the organization are known as the 'internal environment'. They are
generally audited by applying the 'Five Ms' which are Men, Money, Machinery, Materials and
Markets: The internal environment is as important for managing change as the external. As
marketers we call the process of managing internal change 'internal marketing.'
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Men: ITC employs over 25,000 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 3, 53,000 shareholders, fulfill the aspirations of its
stakeholders and meet societal expectations.
Money: ITC is one of India's foremost private sector companies with a market capitalization of
nearly US $ 14 billion and a turnover of over US $ 5 billion. ITC is one of the country's biggest
foreign exchange earners (US $ 3.2 billion in the last decade).
Machinery: ITC is using world class machinery so that they can match with demand of the
market. Their most of the facilities are fully automated.
Materials: ITC is using quality raw material so that they can give world class quality product to
their customers. They are very selective while selecting supplier for them.
Markets: Its businesses and brands are focused almost entirely on the Indian markets, and
despite being most well-known for its tobacco brands such as Gold Flake, the business is now
diversifying into new FMCG (Fast Moving Consumer Goods) brands in a number of market
sectors - including cigarettes, hotels, paper, agriculture, packaged foods and confectionary,
branded apparel, personal care, greetings cards, Information Technology, safety matches, incense
sticks and stationery.
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ITC BUSINESS PORTFOLIO
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
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includes Insignia, India Kings, Classic, Gold Flake, Silk Cut, Navy Cut, Scissors, Capstan,
Berkeley, Bristol and Flake.
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.
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 and
Kolkata. These factories are known for their high levels of quality, contemporary technology and
work environment.
ITC started an earnest exercise by creating a new brand image and corporate philosophy
by investing in new business categories like personal care, premium apparel, rural business (e-
Choupal) and foods. All along using its famed distribution strengths built through its successful
past businesses like cigarettes, paperboards and packaging, hotels and agri business, to create
synergies across its verticals and help prop up its new businesses, like personal care and foods.
ITC has a well thought-out strategic approach. Rather than acquiring weaker brands to get into
these new segments inorganically, it created a range of new personal care and branded apparel
brands.
The first step in this well-planned strategy was the launch of Wills Lifestyle, the premium
branded apparel business in 2002.ITC then moved on to take the competition head on in the
FMCG domain, through ITC Foods in August 2001, and personal care business, which is the
focal point of this story, in 2005. It has created good impact with its well etched-out Personal
Care Brands. Under this category, brands like Essenza Di Wills, Fiama Di Wills, Vivel Di Wills,
Vivel and the Superia were designed to take care of various sets of consumer segments.
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But behind this launch was five years of intensive on ground research of market
conditions and consumer expectations. Over one lakh consumers were surveyed across the
country to test various prototypes. Acceptance benchmark was kept as high as 90 percent for the
final products. ITC called this exercise as '3E’ approach —explore, establish and execute. As an
adage goes 'if you have to win a race, you have to clearly target the No 1', ITC too aimed the No
1 which happened to be the formidable HUL (which still reigns over 50 percent of the FMCG
market). And ITC's target was HUL and P&G only. ITC roped in its tobacco business veteran
Sandeep Kaul to spearhead the personal care launch; it also sought help from product
formulation and branding experts in Europe and America to formulate the fragrance, aesthetics
and packaging. Many of the brands have also been developed at its R&D centre. The results are
there for everyone to see. In less than four years, ITC has been able to create brand awareness
and consumer acceptance for its five product lines Essenza Di Wills, Fiama Di Wills, Vivel Di
Wills, Vivel and the Superia—each targeted at the needs, aspirations and usage behavior of
different consumer segments. Kaul informs that the strategy for designing personal care is that
everyone is a potential consumer
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DISTRIBUTION SYSTEM AT ITC
ITC follows:
CHANNEL WISE DISTRIBUTION
Here the total product is divided into different channels like, Healthcare product,
Personal care products, Home products & etc.
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BEAT WISE DISTRIBUTION
Here total market is divided into different areas where the products are served to all the
outlets exist in that area.
OPERATIONS AT DISTRIBUTOR POINT
There are 22 distributor points for ITC in Hyderabad and Secunderabad. They manage all the
products of ITC including personal care, paper boards, and food products.
Management structure at distributor point will be as follows (with reference to Balaji Agencies,
Mehidipatnam, Hyderabad)
Depot in charge manages all the operations in the distributor point. Under him business
development managers exists for various segments. And BDMs guide the supervisors who work
under their assistance. They set the targets to supervisors and who in turn sets the targets to
salesmen under them. Supervisors convey the messages about the stock availability to the
salesman and about sales volume to the BDMs.
All the products are distributed to various distributor points from the hub located in
Secunderabad. The management at hub will assign target to the distributor point which is
22
Depot InchargeSupervisor(s)SalesmenSupervisor(s)Salesmen
Page 23
delegated till salesmen. Sales status is updated by the distributors in MIS and the equivalent sold
material is replenished by the hub in 2 days.
2 LITERATURE REVIEW
The concept of validity related to response processes was included in the 1999 Standards for
Educational and Psychological Testing. The standards, however, provide only some very basic
guidelines on how this information may be helpful and on how to collect this type of data. The
standards define evidence based on response process as the “fit between the construct and the
detailed nature of 16 performance or response actually engaged in by examinees” (p. 12). The
Standards state that for example,
…if a test is intended to assess mathematical reasoning, it becomes important to determine
whether examinees are, in fact, reasoning about the material given instead of following a
standard algorithm. For another instance, scores on a scale intended to assess the degree of an
individual’s extroversion or introversion should not be strongly influenced by social conformity
In other words, evidence based on response process needs to support that the test measures the
intended construct in that students’ responses are eliciting the intended reasoning.
In addition, evidence based on response process needs to show that the responses are not
being influenced by construct-irrelevant factors. Standard 1.8, the specific standard that relates to
the collection of response process follows: If the rationale for a test use or score interpretation
depends on premises about the psychological processes or cognitive operations used by
examinees, then theoretical or empirical evidence in support of those premises should be
provided. When statements about the processes employed by observers or scorers are part of the
argument for validity, similar information should be provided
The standards do not discuss in great detail how response process information should be
collected. They do provide a few examples of gathering evidence such as questioning test-takers,
documenting performance through tracking eye movements, analyzing relationships among parts
of a test, and examining the ratings of judges. Other than the brief statements quoted above, the
Standards do not provide much information on why response process information is important in
test development nor do 17 they provide practical guidance to the test developer as to methods
collecting this type of evidence. The remainder of this section will review the literature regarding
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1) arguments on why response process validity is a necessity in test development and 2) how
response process data can be collected. The primary focus of the latter section will be on the use
of verbal protocols, including suggested methodology and associated problems or concerns.
While the concept of response process validation is relatively new, research throughout
the past several decades has begun to shift in the direction of linking psychometric theory and
practices to research in cognitive development (i.e. Frederiksen, Mislevy, & Bejar, 1993;
Pellegrino, Baxter, & Glaser, 1999; Snow & Lohman, 1993). Several researchers have
emphasized the importance of collecting this type of information in test development in order to
support the validity argument and to learn more about the construct of interest. One of the
primary arguments for the collection of response process data concerns the issue of alignment of
the test developers’ intentions and the nature of the cognitive activity actually elicited during test
administration.
In their examination of alignment between test developers’ intent and elicited
information from students taking a middle school science state assessment, Ferrara, Duncan,
Freed, Velez-Paschke, McGivern, Mushlin, Mattessich, Rogers, & Westphalen (2004) provide an
informative definition of this concept of alignment: We define alignment as the degree of
correspondence between content area knowledge, content area skills, broader cognitive
processes, and response 18 strategies (i.e., Knowledge, Skills, Processes, and Strategies: KSPS)
that (a) test developers intended to assess, and (b) examinees bring to bear when they respond to
test items
The authors further discuss that when the intended and observed KSPS align, construct
validity for this item is supported. When the intended and observed are misaligned, this may
indicate that an item is not construct-valid and thus inferences made from test scores could
potentially be suspect. Misalignment is not necessarily uncovered through the use of test
specifications, expert judgment, or statistical analyses. Gorin (2006) recognized the limitations of
the traditional methods of test development and encouraged more extensive examination of items
in order to explore the cognitive processes employed. As she states.
Test developers must consider even more rigorous methods of item examination before
operational use that provides explicit evidence regarding the skills, knowledge, and processes
measured by the items. Item design should proceed from sources of cognitive complexity related
to the construct of interest, rather than unrelated surface features (p. 33). A 1997 study by Gierl
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supported that test developers are often not able to predict the type of cognitive processes that are
elicited by items. In his study, Gierl used think-aloud protocols to examine the putative cognitive
processes elicited on a test of mathematics and compared these to the anticipated cognitive
processes as described in the test specifications. The intended and observed cognitive processes
were only found to coincide 54% of the time. As he noted, “Cognitive features such as strategy
selection and higher order thinking are often poorly evaluated because item writers are not
trained to 19 identify the cognitive processes required to solve items “(p. 26). Additionally, he
noted,
“If test developers hope to assess students’ cognitive processes successfully, researchers
should use think-aloud protocols to evaluate directly the problem-solving strategies that students
use to solve achievement test items”. Thus, when response process information is included in test
specifications, test developers should still examine the actual process elicited as misalignment
can often occur.
PREVIOUS RESEARCH
At an empirical research level, Strandholm & Kumar (2003) asserted the existence of a
positive relationship between external environmental analysis style and overall organizational
performance and the ability to gain a competitive advantage.
Flatt and Kowalczyk (2008) also concluded that organizational culture is one intangible
asset that can help organizations create a competitive strategic advantage and enhance financial
performance.
Vorhies and Morgan (2005) suggested that the use of proper marketing benchmark tools
to benchmark marketing capabilities has become a key learning mechanism to deliver sustainable
advantage.
BCG MATRIX
The BCG matrix (aka B-Box, B.C.G. analysis, BCG-matrix, Boston Box, Boston
Matrix, Boston Consulting Group analysis, portfolio diagram) is a chart that had been created by
Bruce Henderson for the Boston Consulting Group in 1970 to help corporations with analyzing
their business units or product lines. This helps the company allocate resources and is used as an
analytical tool in brand marketing, product management, strategic management, and portfolio
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analysis. Analysis of market performance by firms using its principles has called its usefulness
into question, and it has been removed from some major marketing textbooks
Cash cows are units with high market share in a slow-growing industry. These units typically
generate cash in excess of the amount of cash needed to maintain the business. They are regarded
as staid and boring, in a "mature" market, and every corporation would be thrilled to own as
many as possible. They are to be "milked" continuously with as little investment as possible,
since such investment would be wasted in an industry with low growth.
Dogs, or more charitably called pets, are units with low market share in a mature, slow-
growing industry. These units typically "break even", generating barely enough cash to maintain
the business's market share. Though owning a break-even unit provides the social benefit of
providing jobs and possible synergies that assist other business units, from an accounting point
of view such a unit is worthless, not generating cash for the company. They depress a profitable
company's return on assets ratio, used by many investors to judge how well a company is being
managed. Dogs, it is thought, should be sold off.
Question marks (also known as problem children) are growing rapidly and thus consume large
amounts of cash, but because they have low market shares they do not generate much cash. The
result is a large net cash consumption. A question mark has the potential to gain market share
and become a star, and eventually a cash cow when the market growth slows. If the question
mark does not succeed in becoming the market leader, then after perhaps years of cash
consumption it will degenerate into a dog when the market growth declines. Question marks
must be analyzed carefully in order to determine whether they are worth the investment required
to grow market share.
Stars are units with a high market share in a fast-growing industry. The hope is that
stars become the next cash cows. Sustaining the business unit's market leadership may require
extra cash, but this is worthwhile if that's what it takes for the unit to remain a leader. When
growth slows, stars become cash cows if they have been able to maintain their category
leadership, or they move from brief stardom to dogdom.
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Practical use of the BCG Matrix
For each product or service, the 'area' of the circle represents the value of its sales. The
BCG Matrix thus offers a very useful 'map' of the organization's product (or service) strengths
and weaknesses, at least in terms of current profitability, as well as the likely cash flows.
The need which prompted this idea was, indeed, that of managing cash-flow. It was
reasoned that one of the main indicators of cash generation was relative market share, and one
which pointed to cash usage was that of market growth rate.
Derivatives can also be used to create a 'product portfolio' analysis of services. So
Information System services can be treated accordingly.
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3 RESEARCH METHODOLOGY
Research methodology is the systematic way to solve the research problem. It gives an idea
about various steps adopted by the researcher in a systematic manner with an objective to
determine various manners.
Meaning of Research
Research is defined as “a scientific & systematic search for pertinent information on a
specific topic”. Research is an art of scientific investigation. Research is a systemized effort to
gain new knowledge. It is a careful inquiry especially through search for new facts in any branch
of knowledge. The search for knowledge through objective and systematic method of finding
solution to a problem is a research.
3.1 RESEARCH DESIGN
A research is the arrangement of the conditions for the collections and analysis of the data in a
manner that aims to combine relevance to the research purpose with economy in procedure. In
fact, the research is design is the conceptual structure within which research is conducted; it
constitutes the blue print of the collection, measurement and analysis of the data. As search the
design includes an outline of what the researcher will do from writing the hypothesis and its
operational implication to the final analysis of data.
TYPE OF RESEARCH
This research is exploratory in nature as it gives insights about the project or the problem taken
up.
DATA COLLECTION PROCEDURE:
For the present study, primary as well as secondary data is necessary.
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PRIMARY DATA:
A format for data gathering was prepared which will fit to check with format of the 3 rd party(AC
NIELSEN) .Data was collected through observation and interviewing.
SECONDARY DATA:
Data was also collected from ITC’s official website and some other websites.
3.2 SAMPLE DESIGN:
POPULATION:
Population for this research is 55 super premium and modern variant retailers in Hyderabad.
SAMPLE AREA:
Data was collected in form the retailers located in Hyderabad and areas are
Kukutpally, JNTU, Chandanagar ,Allwyn colony, BHEL, Ramachandrapuram,
Gachibowli, Hi-tech city, Kondapur, Kothaguda, Tolichowki, Banjara hills
SAMPLE SIZE: 55
SAMPLING METHOD:
The sampling method adopted was ‘random sampling’
DURATION OF THE PROJECT
The total duration of the project was 8 weeks.
TOOLS USED FOR ANALYSIS:
Data which was collected is represented in bar graphs and pie charts for analysis.
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4 DATA ANALYSIS AND INTERPRETATION
Data is collected in the format designed, by visiting the outlets. Most of the data is
collected by observing the product availability in the modular display. Data regarding the
maintenance of the on-shop board, competitor products (if available) and their sales volume is
collected by interviewing the outlet owner.
4.1 SWOT ANALYSIS
STRENGTHS
Biggest and largest player in the Indian tobacco market with a market share of around
80%.
The company has an excellent distribution channel of network which has enabled the
availability of products in different regions as per the consumer demand and supply for
the product.
Brand recognition is high.
ITC’s gold flake tobacco brand is the largest fmcg brand in India and this single brand
alone holds around 70% of tobacco brand.
Success of Classic brand family.
Entry barriers in the cigarette industry are high which reduces the threat of new
entrants.
WEAKNESSES
The main weakness of the company is that after the ban on advertisement it is not able to
promote the product on higher basis as it was promoted before the ban.
Mostly depending on tobacco products.
Government regulations on tobacco products.
Due to high price of cigarette, consumers are switching to other cheaper forms of
tobacco.
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Negative opinion on cigarettes in some parts of society.
It becomes difficult for the company to differentiate and decide the quality, price and
other factors of the cigarettes while manufacturing and distributing.
OPPORTUNITIES
Increasing income level of the middle class.
Can have tie up with other businesses where the customer base is high.
Promote the brands whose availability is less.
As ITC is being recognized as World’s Best Big Companies and the World’s Most
Reputable Companies by Forbes magazine, the company can launch its brands at
international level through collaboration with sports events held at international level and
also with other brands.
The packaging of the product should be changed and each and every attribute should be
mentioned on the packet and also the level of harmless should be mentioned. This will
help in Word of Mouth marketing.
THREATS
The threats of the company are competition from international companies. The main
competitors are Marlboro, Marlboro Lights, and 555 cigarettes. These companies are
famous at international level and also as an imported cigarette brand with affordable
price; the consumers prefer to buy them.
Ban on smoking in public places.
Competition from unbranded products.
The next threat may also be the changing habits of the consumer; they may quit smoking
due to its ill effects and hazards. This may affect the sales as well as the brand image of
the product
In future the government may completely put ban on advertisement of cigarettes or also
put a ban on sponsorship under the consideration that cigarette is harmful for health. This
will be the biggest threat for the product as well as the company.
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Excise duty on unfiltered cigarettes less than 60mm in length was increased 387% last
year; Hike was 142% for those between 61mm and 70mm long.
MATCHING STRENGTHS AND OPPURTUNITIES
Matching is used to find competitive advantages by matching the strengths to opportunities.
ITC can experiment on various strategies for its further growth in cigarette sector as the
unexpected failures of those experiments may not affect much.
ITC’s brand image in the minds of consumers will support its future projects.
ITC can now focus super premium brands considering the raise in income level of
individuals.
Maintaining good relationship with outlet owners and having toe ups with other business
where the probability of cigarette consumption is high will be an hidden advantage.
CONVERTING WEAKNESSES AND THREATS
Converting is to apply conversion strategies to convert weaknesses or threats into strengths or
opportunities
In order to retain the customers switching towards unbranded or cheap products, make
low end products for them maintaining the quality.
As the changing habits of consumers cannot be avoided, ITC should focus more on high
filtered cigarettes.
Surrogate advertising method should be implemented to promote premium brands.
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4.2 BCG MATRIX OF ITC
Under FMCG, cigarettes are in cash cow stage where the market share is high and growth
rate is low.
ITC with its large number of variants available under cigarette section grabbed major
share in India.
Sales are stagnated and the growth rate is increasing in less margin because of the
presence of “me too” like products.
Product differentiation is difficult but can be achieved.
Launching of new schemes and acquiring more outlets will enhance the sales.
4.3 VALIDATION OF OUTLETS
33
Agri-businessHotelsPaper boards and packaging
FMCG goodsITC infotech
FMCG Cigarettes
Branded apparelPackaged goodshigh low
low
high
Relative position (market share)
Mar
ket g
row
th ra
te
Page 34
Interpretation:
It is observed form the data that all the super premium outlets visited have a minimum of
five brands (each MRP RS.110) available in the outlet with sale more than 700 sticks per
day.
It is observed that all the modern variant outlets visited are having more than 3 king size
filter brand packs available in the outlet with the sale being more than 120 sticks per day.
All the outlets which categorized under super premium and modern variant outlets are
satisfying the respective conditions and no re-check required to verify taking the sales
potential and loyalty into account.
AVAILABILITY OF SUPER PREMIUM BRAND CIGARETTES
Brands like India Kings and Insignia are considered as super premium brands considering
the price and richness of tobacco.
INSIGNIA IK RICH GOLD0
10
20
30
40
50
60
70
Super premium brands availability
No.
of o
utle
ts
Interpretation:
From the data it is found that out of 43 outlets visited Insignia brand is available in 21
outlets with the availability of 48 packets on the whole.
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India Kings (IK) brand is available in 29 outlets with the availability of 60 packets on the
whole.
AVAILABILITY OF GOLD FLAKE BRAND CIGARETTES
RED BLUE GOLD ARCTIC MENTHOL
SLK0
100
200
300
400
500
600
Goldflake kings family availabil-ity
No.
of o
utle
ts
Interpretation:
From the data it is found that out of 43 outlets visited Gold flake red brand is available in
39 outlets with the availability of 528 packets on the whole.
Gold flake blue brand is available in 39 outlets with the availability of 403 packets on the
whole.
Gold flake gold brand is available in 23 outlets with the availability of 92 packets on the
whole.
Gold flake arctic menthol brand is available in 16 outlets with the availability of 44
packets on the whole.
Gold flake sleek brand is available in 21 outlets with the availability of 53 packets on the
whole.
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AVAILABILITY OF CLASSIC BRAND CIGARETTES
RICH BALANCED REFINED REFRESHING VERVE0
20
40
60
80
100
120
140
160
180
Classic family availability
no. o
f out
lets
Interpretation:
From the data it is found that out of 43 outlets visited Classic rich brand is available in 33
outlets with the availability of 110 packets on the whole.
Classic balanced brand is available in 35 outlets with the availability of 167 packets on
the whole.
Classic refined brand is available in 31 outlets with the availability of 82 packets on the
whole.
Classic refreshing brand is available in 35 outlets with the availability of 112 packets on
the whole.
Classic verve brand is available in 25 outlets with the availability of 140 packets on the
whole.
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AVAILABILITY OF PLAYERS BRAND CIGARETTES
Players RED
Players BLUE
0 10 20 30 40 50 60
Players availability
Interpretation:
From the data it is found that out of 43 outlets visited Players red brand is available in 18
outlets with the availability of 51 packets on the whole.
Players blue brand is available in 19 outlets with the availability of 44 packets on the
whole.
It is observed that Players brand is having the least availability among all the ITC brands.
Also 11 outlets have the outdated stock of Players brand.
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AVAILABILITY OF OTHER BRAND CIGARETTES
555 MII
B&H GOLD
B&H GOLD BLUE
0 10 20 30 40 50 60 70 80
other brands availability
B&H gold, gold blue and 555 are the other premium brands of ITC.
Interpretation:
From the data it is found that out of 43 outlets visited 555 brand is available in 11 outlets
with the availability of 11 packets on the whole.
B&H gold brand is available in 15 outlets with the availability of 24 packets on the
whole.
B&H gold blue brand is available in 27 outlets with the availability of 67 packets on the
whole.
MODULAR DISPLAY AND SHELVING
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Modular display and shelving are some of the merchandising methods adapted in the
outlets by ITC as a part of new scheme. Modular display is a cardboard rack embedded on to the
wall of the outlet with glassy finishing to attract customers and give the outlet a rich look. There
is space provided on the modular display to exhibit brands. Shelving is also done in the outlet by
ITC as a part of Club Royale scheme. All the cigarette brands are stored in the shelves with a
hotspot view to the customers.
shelving Modular display0
5
10
15
20
25
30
35
40
45
Modular display and shelving
Interpretation:
It is observed that out of 43 outlets visited 41 outlets have modular display and in the
remaining 2 outlets order for the display is taken but not yet installed.
It is observed 40 outlets have shelving and in the remaining 3 outlets order for the
shelving is taken but not yet installed.
ON –SHOP AD BOARD
After signing in to the club royale scheme retail architecture, modular display and on-
shop, in-shop ad boards are given by the ITC on certain conditions. On-shop board displays any
of the ITC’s cigarette brand names and the same brand name will be reflected in the in-shop ad
board. Depending upon the location and view of the outlets there may be more than one ad board
on the outlet.
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Classic GFKL GFKR No ad board0
5
10
15
20
25
On shop ad board
Interpretation:
It is observed that out of 43 outlets visited 20 outlets have Classic, 6 outlets have Gold
flake king lights, 4 outlets have gold flake red brand advertisement on their ad board.
There is no ad board for 13 outlets due to the reasons like damage, maintenance and
others.
ISSUES FOUND
During the visit to the outlets many problems were identified and told by the outlet
owners. Most of the problems were solved within a couple of days time by informing directly to
the authority. Major issue for many outlets is regarding the strength of the retail architecture
built. And the next major issue is in availability of the stock at the salesman.
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stren
gth of R
A
Short-
circu
it
Stock
availa
bility w
ith haw
ker
Maintai
nance
money
Presen
ce of c
ompetitors
brands
Poor main
tenace
Less c
onfectionery
0123456
Issues
no. o
f out
lets
Presence of competitor brands products is existing in 3 outlets.
Issues related to strength of the retail architecture built is faced by 5 outlets
Unavailability of stock with the salesman is face by 4 outlets
Problem with irregular supply of maintenance money is faced by 2 outlets.
Two are outlets are showing poor maintenance of outlet.
OTHER PRODUCTS OF ITC
Other than cigarettes ITC is trying to push its products belonging to other segments like personal
care, incense sticks, confectionery in these outlets.
CONFECTIONERY; 37
BISCUITS; 6
BINGO; 4
SOAPS; 3
SHAMPOO; 3AGARBATTI; 2
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Interpretation
Confectionery like chocolates is available in 37 outlets, biscuits in 6 outlets, bingo in 4
outlets, soaps in 3 outlets, shampoo in 3 outlets, agarbatti in 2 outlets.
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5.1 FINDINGS
It is found that all the outlets categorized under super premium and modern variant
categories satisfy the respective conditions.
ITC’s aim to make all its cigarette brands available in all these outlets is partially
achieved.
Many outlets violated the condition of making competitor brand products unavailable.
Merchandising methods were properly implemented by almost all outlets.
Few outlets have the issue of strength of the retail architecture expressing the threat to
theft.
Few outlets have water leakage issue.
Few outlets have the problem of electric shock because of improper wiring done.
It is found that most of the customers are not aware that the cigarette belongs to ITC.
Supervisor-outlet owner do influence the business to major extent.
5.2 SUGGESTIONS
Brands like Gold flake arctic menthol, Classic menthol which are of mint flavored should
be promoted at the outlets near the corporate offices.
Super premium brands like Insignia and India kings can be promoted widely through
surrogate advertisements.
Advertisement about the product portfolio can be done at the smoking zones at theatres,
corporate offices with proper permission.
Exclusive outlets can be opened near to the food stations, bars, theatres and other high
consumption areas.
Wide counter area on the retail architecture which is plain can be used for advertisement.
Good relationship should be maintained between supervisor and outlet owner for
successful implementation of this plan.
Make the outlet owner realize the benefits of being a virtual ITC outlet.
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5.3 LIMITATIONS
Practically it may not be possible to stop the retailers form selling competitor brand
cigarettes.
Continuous monitoring about the implementation of the scheme rules may not be
possible.
The time period for the study was not enough to validate all the super premium and
modern variant outlets in Hyderabad.
It was difficult for the storekeepers to pinpoint the sales of a particular competitor
brand in the outlet.
Location tracking of the outlet was time consuming.
As the nature of research was exploratory and descriptive so it was difficult to cover
each and every outlet.
Collection of data was difficult at some outlets located at prime areas because of the
customer flood at the outlet.
Accuracy of data was disturbed at some outlets as the data was collected before the
salesman visit to the outlet.
12 outlets were closed during the visit.
5.4 CONCLUSION
Thus it can be concluded that the newly categorized outlets satisfy the conditions of being
super premium and modern variant. ITC is partially successful in implementing the scheme
“Club Royale” in these outlets. It can attain complete success with proper monitoring,
maintaining good relationship with outlet owner and creating awareness of being virtual ITC
outlet.
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Philip Kotler, Abraham Koshy, Kevin Lane, “ Marketing Management: A South Asian
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Naresh K. Malhotra, Satyabhushan Dash, “Marketing Research: An Applied Orientation ,
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