Shailendra Education Society’s

Arts, Science & Commerce College

Study of Dairy Industry with Special Reference to the Products

of Amul (Analysis of ice-cream)

Presented byVipul sheladiya 56

Vivek surve 57

Yateen sawant 58

Thought by: prof. mrunalini ravalekar

Module Content Pg.no

I. Introduction a) History of ice-cream in Indiab) History of Amulc) Details of all products of Amuld) Details of Amul ice-cream

II. Advertising strategiesa) Marketing schemesb) TV advertisementsc) Attractive packaging

III. Market demanda) Internal demandb) External demand

IV. Kwality Walls

a) Details of Kwality Wallsb) Market demand

V. Comparison between Amul ice-cream & Kwality Walls

VI. Conclusion

Ice-cream

IntroductionThe ice cream market growth picked up after de-reservation of the sector in 1997. Of the total size of Rs 15-16bn, around 30-32% is in the hands of organized sector valued at Rs 4.9bn, rest all is with the unorganized sector. Among the major players in this industry Hindustan Lever has a market share of around 50%, represented mainly by Kwality Walls brand. Amul with an estimated market share of 35% is rapidly gaining market share and lastly Vadilal is the player in the national market with 8-9% of the market share

Production areaIn rural areas, kulfis / ice creams made by small / cottage industry are popular. The market for

organized sector is restricted to large metropolitan cities. In small towns and villages, there are thousands of small players who produce ice- creams / kulfis in their home backyard and cater to the local market. Almost 40% of the ice creams sold in the country are consumed in the western region with Mumbai being the main market, followed by 30% in the north and 20% in the south.

Growth promotional activitiesThe Indian government adopted the policy of liberalization regarding the ice cream industry also and it is since then that this sector has shown an annual growth ranging from 15- 20% per annum for last 1- 2 year. Presently in 1999- 00 it is estimated at worth of Rs15- 16bn. This growth rate is expected to continue for another next 2- 3 years because of lower baseTypesIndian Ice Cream market can be segmented in three different ways, namely on the basis of flavors; on the basis of stock keeping units / packaging and on the basis of consumer segments. On the basis of flavors the market today has a number of flavors like vanilla, strawberry, chocolate, mango, butterscotch a number of fruit flavors, dry fruit flavors traditional flavors like Kesar- Pista, Kaju- Draksh etc.

The market is totally dominated by Vanilla, Strawberry and chocolate, which together account for more than 70% of the market followed by

butterscotch and other fruit flavors.

Amul – HistoryAmul (Anand Milk Union Limited), formed in 1946, is a dairy cooperative movement in India. It is a brand name managed by an apex cooperative organisation, Gujarat Co-operative Milk Marketing Federation Ltd. (GCMMF), which today is jointly owned by some 2.6 million milk producers in Gujarat, India[1].

AMUL is based in Anand, Gujarat and has been a sterling example of a co-operative organization's success in the long term. It is one of the best examples of co-operative achievement in the developing world. "Anyone who has seen ... the dairy cooperatives in the state of Gujarat, especially the highly successful one known as AMUL, will naturally wonder what combination of influences and incentives is needed to multiply such a model a thousand times over in developing regions everywhere."[2] The Amul Pattern has established itself as a uniquely appropriate model for rural development. Amul has spurred the White Revolution of India, which has made India the largest producer of milk and milk products in the world. It is also the world's biggest vegetarian cheese brand [3].

Amul is the largest food brand in India and world's Largest Pouched Milk Brand with an annual turnover of US $1050 million (2006-07) [4]. Currently Amul has 2.6 million producer members with milk collection average of 10.16 million litres

per day. Besides India, Amul has entered overseas markets such as Mauritius, UAE, USA, Bangladesh, Australia, China, Singapore, Hong Kong and a few South African countries. Its bid to enter Japanese market in 1994 had not succeeded, but now it has fresh plans of flooding the Japanese markets [5]. Other potential markets being considered include Sri Lanka.

Dr Verghese Kurien, former chairman of the GCMMF, is recognised as the man behind the success of Amul. On 10 Aug 2006 Parthi Bhatol, chairman of the Banaskantha Union, was elected chairman of GCMMF

The 'Amul revolution' started as awareness among the farmers, grew and matured into a protest movement that was channeled towards economic prosperity. Over five decades ago, the life of a farmer in Kheda District was very much like that of his/her counterpart anywhere else in India. His/her income was derived almost entirely from seasonal crops. The income from milk buffaloes was undependable. Private traders and middlemen controlled the marketing and distribution system for the milk. As milk is perishable, farmers were compelled to sell it for whatever they were offered. Often, they had to sell cream and ghee at throw-away prices. In this situation, the private trader made a killing. Gradually, the realization dawned on the farmers that the exploitation by the trader

could be checked only if marketed their milk themselves. Amul was the result of that realization.

The Kaira Union began pasteurizing milk for the Bombay Milk Scheme in June 1948. By the end of 1948, more than 400 farmers joined in more Village Society, and the quantity of milk handled by one Union increased from 250 to 5,000 liters a day. The success of Amul was instrumental in launching the White Revolution that resulted in increased milk production in India. It is termed as "Operation Flood" by Amul.

Currently Amul has 2.41 million producer members with milk collection average of 5.08 million litres/day. Amul's sales turnover in 2004-05 was 672 million US $.

Amul dairies are all over India

Amul - Products

Check out this vast and ever-growing range of 'tasteful' Amul delectables.

Bread Spreads

Amul ButterUtterly Butterly Delicious

Amul LiteLow fat, low Cholesterol Bread Spread

Delicious Table MargarineThe Delicious way to eat healthy

Milk Drinks

Amul Kool Millk Shaake

Amul Kool

Amul Kool Cafe Kool KokoA delight to Chocolate Lovers. Delicious Chocolate taste

Nutramul Energy DrinkA drink for Kids - provides energy to suit the needs of growing Kids

Amul Kool Chocolate Milk

Amul Kool Flavoured Bottled Milk

Amul Kool Flavoured Tetra Pack

Amul Masti Spiced ButtermilkAmul introduces the Best Thirst Quenching Drink

Amul Kool Thandai

Powder Milk

Amul Spray Infant Milk FoodStill, Mother's Milk is Best for your baby

Amul Instant Full Cream Milk PowderA dairy in your home

Sagar Skimmed Milk PowderWhich is especially useful for diet preparations or for use by people on low calorie and high protein diet.

Sagar Tea Coffee Whitener

Amulya Dairy WhitenerThe Richest, Purest Dairy Whitener

   

Fresh Milk

Amul Fresh MilkThis is the most hygienic milk available in the market. Pasteurised in state-of-the-art processing plants and pouch-packed for convenience.

Amul Gold Milk

Amul Taaza Double Toned Milk

Amul Lite Slim and Trim Milk

Amul Fresh Cream Amul Shakti Toned Milk

Amul Calci+

Cheese

Amul Pasteurised Processed Cheese100% Vegetarian Cheese made from microbial rennet

Amul Cheese SpreadsTasty Cheese Spreads in 3 great flavours..

Amul Emmental CheeseThe Great Swiss Cheese from Amul, has a sweet-dry flavour and hazelnut aroma

Amul Pizza Mozzarella CheesePizza cheese...makes great tasting pizzas!

Gouda Cheese

   

For Cooking

Amul / Sagar Pure GheeMade from fresh cream. Has typical rich aroma and granular texture. An ethnic product made by dairies with decades of experience.

Cooking Butter

Amul Malai PaneerReady to cook paneer to make your favourite recipes!

Utterly Delicious Pizza

Mithai MateSweetened Condensed Milk - Free flowing and smooth texture. White to creamy color with a pleasant taste.

Masti Dahi

Desserts

Amul Ice CreamsPremium Ice Cream made in various varieties and flavours with dry fruits and nuts.

Amul ShrikhandA delicious treat, anytime.

Amul Mithaee Gulab JamunsPure Khoya Gulab Jamums...best served piping hot.

Amul ChocolatesThe perfect gift for someone you love.

Amul Lassee Amul Basundi

Health Drink

NutramulMalted Milk Food made from malt extract has the highest protein content among all the brown beverage powders sold in India.

Amul Shakti Health Food Drink Available in Kesar-Almond and Chocolate flavours.

Amul ice-cream in detailsAmul Ice Cream was launched on 10th March, 1996 in Gujarat. The portfolio consisted of impulse products like sticks, cones, cups as well as take home packs and institutional/catering packs. Amul ice cream was launched on the platform of ‘Real Milk. Real Ice Cream’ given that it is a milk company and the wholesomeness of its products gives it a competitive advantage.

In 1997, Amul ice creams entered Mumbai followed by Chennai in 1998 and Kolkata and Delhi in 2002. Nationally it was rolled out across the country in 1999.

It has combated competition like Walls, Mother Dairy and achieved the No 1 position in the country. This position was achieved in 2001 and it has continued to remain at the top.

Today the market share of Amul ice cream is 38% share against the 9% market share of HLL, thus making it 4 times larger than its closest competitor.

Not only has it grown at a phenomenal rate but has added a vast variety of flavours to its ever growing range. Currently it offers a selection of 220 products. Amul has always brought newness in its products and the same applies for ice creams.

In January 2007, Amul introduced SUGAR FREE &

ProLife Probiotic Wellness Ice Cream, which was a first in India. This range of SUGAR FREE, LOW FAT Diabetic Delight & ProLife Probiotic Wellness Ice Cream is created for the health conscious.

Amul’s entry into ice creams is regarded as successful due to the large market share it was able to capture within a short period of time – due to price differential, quality of products and of course the brand name.

 

The entry of Amul into Ice Cream

 

 

For any new player to enter this market, three things are critical:

Decentralized manufacturing facilities

Efficient cold chain

Growing market

   

Amul Ice Cream was launched on 10th March, 1996 at Ahmedabad. Subsequently the distribution and marketing operations were rolled out across the country.

 Present Status of Amul Ice Cream : 

In a short span of 6 years Amul Ice Cream has become the No.1 ice cream brand in the country. It is now the only national brand and all other ice cream brands are regional.

Amul Ice Cream has achieved 38% share against 9% market share of HLL making it 4 times larger than its closest competitor.

.

Amul Ice cream made of the freshest milk and the

freshest cream blended with the yummiest flavours, fruits and nuts to make you keep on asking for more.

Marketing strategy

Amul Ice Cream: Marketing Strategy” is a

case study written by Supratim Majumdar and Tirthankar Roy. Amul brand of ice cream reached a high growth within 6 years of its launch and defeated multinational brands of ice cream in Indian market. The experts attribute this success to the successful planning and implementation of Amul’s marketing mix tactics. When the existing brands were struggling for market share, Amul launched ice creams in 14 flavors and positioned it

as the real ice cream and was priced 30% lower than the market leader. In 2003, it overtook Kwality Walls to emerge as a biggest player. The case study gives a brief history of ice cream industry in India and also the competition faced by Amul brand in different markets. It compares Amul with Kwality Walls on the grounds of their marketability mix viz., product strategies, pricing atrategies, distribution strategies and promotion strategies

Amul "Utterly Delicious" Parlours

Amul has recently entered into direct retailing through "Amul Utterly Delicious" parlours created in major cities Ahmedabad, Bangalore, Baroda, Delhi, Mumbai, Hyderabad and Surat. Amul has plans to create a large chain of such outlets to be managed

by franchisees throughout the country.

Amul have created Amul Parlours at some

prominent locations in the country, which are run by the company or its wholesale dealers:

1. Delhi Metro Rail Corporation 2. The Somnath Temple 3. National Institute of Design 4. Infosys Technologies in Bangalore, Mysore & Pune 5. Wipro campus in Bangalore 6. L.J. College, Ahmedabad 7. Ahmedabad Airport 8. Surat Municipal Corporation 9. Delhi Police 10.Gujarat State Raod Transport Corporation 11.Jubilee Mission Medical College, Trichur, Kerala 12.Sanjay Gandhi Hospital Parlour, Amethi 13.Indian Institute of Management, Kolkata 14.Cafe Amul, MDG, Gandhinagar

"Amul Utterly Delicious" parlours are an excellent business opportunity for investors, shopkeepers and organizations. In order to come closer to the customer, we have decided to create a model for retail outlets, which would be known as "Amul Preferred Outlets"(APO).

Amul ice-cream’s “buy one get one free”

Advertising

An Amul butter ad on Pakistan's Kargil War fiasco. The image shows the "Amul baby" in between George Fernandes and Vajpayee.

Its advertising has also started using tongue-in-cheek sketches starring the Amul baby commenting jovially on the latest news or current events. The pun in her words has been popular. The Amul ads are one of the longest running ads based on a theme, now vying for the Guinness records for being the longest running ad campaign ever. Sylvester daCunha, was the managing director of the advertising agency, ASP, that created the campaign in 1967 whose charm has endured fickle public opinion, gimmickry and all else .

TV Advertisement Various TV commercials of Amul, are one of the important marketing strategy used by amul to introduce there products in the market. Various products of amul such as Amul cool, Amul cheese, Amul pasteurized milk, Amul ice-creams, etc., had there TV commercials which gave boost to there demand in the market. Although there best quality products with affordable price were always in the demand in market, but by making the TV commercials they became the threat there competitors.

Amul also sponsored TV shows, out of which amul Star Voice of India was one of the

hit campaign of amul. The show was aired successfully on Star TV, resulting in one more success story in the books of amul.

AKNOWLEDGEMENT

It is indeed a matter of great pleasure for us to express our sincere gratitude and indebtedness towards our guide PROF. MRUNALINI RAVALEKAR whose profound enthusiasm, co-operation, guidance and keen supervision at every stage of our project work inspired us in pursuing and completing the project within schedule.

We are obliged to our HON’BLE PRINCIPAL DR.V.M.INGAVALE who provided the facilities in the college for carrying out the project .

We are grateful to MS. ANUJA JADHAV,

Librarian for her valuable guidance from time to time.

Omissions , however if any are unintentional.

 

 

 

 

Various advertisement images of Amul

Amul kool milk shake

Amul Shakti milk

Amul malai paneer

Amul pizza cheese

Amul mithai make

Amul kool koko

Attractive packaging

Amul's Vanilla Royale is available in an attractive 500 ml paper cup priced at Rs. 45/- all over the country. It stays fresh for 12 months from the date of packaging when stored at minus 18 degree Celsius

Amul, the market leader in ice creams in the country, has launched the Sundae Swirl Range of Ice-creams. Sundae Swirl is a ripple- based ice cream in which vanilla ice cream is topped

with colorful tasty sauces. Sundae swirl ice cream is packed in an attractive transparent plastic cup having dome shape lid that protects the innovative ice cream shape.

Market demandInternal demand

Amul is India's largest food products marketing organisation. It is a state level apex body of milk cooperatives in Gujarat which aims to provide remunerative returns to the farmers and also serve the interest of consumers by providing quality products which are good value for money.

CRISIL, India's leading Ratings, Research, Risk and Policy Advisory company, has assigned its highest ratings of "AAA/Stable/P1+" to the

various bank facilities of Amul.

Members: 13 district cooperative milk producers' Union

No. of Producer Members:

2.7 million

No. of Village Societies: 13,141

Total Milk handling capacity:

10.21 million litres per day

Milk collection (Total - 2007-08):

2.69 billion litres

Milk collection (Daily Average 2007-08):

7.4 million litres

Milk Drying Capacity: 626 Mts. per day

Cattlefeed manufacturing Capacity:

3090 Mts per day

Sales Turnover Rs (million) US $ (in million)

1994-95 11140 355

1995-96 13790 400

1996-97 15540 450

1997-98 18840 455

1998-99 22192 493

1999-00 22185 493

2000-01 22588 500

2001-02 23365 500

2002-03 27457 575

2003-04 28941 616

2004-05 29225 672

2005-06 37736 850

2006-07 42778 1050

2007-08 52554 1325

External demandAmul is one of the India's largest exporter of Dairy Products. It has been accorded a "Trading House" status. GCMMF (amul) has received the APEDA Award from Government of India for Excellence in Dairy Product Exports for the last 11 years.

The major export products are:

Consumer Packs

Amul Pure Ghee Amul Butter Amul Shrikhand Amul Mithaee Gulabjamun Nutramul Brown Beverage Amul Cheese Amul Malai Paneer Amul UHT Milk (Long Life)

Amul Gold Milk Amul Taaza Double Toned Milk Amul Lite Slim and Trim Milk

Amul Fresh Cream

Bulk Packs

Amul Skimmed Milk Powder Amul Full Cream Milk Powder

Many of our products are now available in the USA, Gulf Countries and Singapore.

Kwality

Wall’s Kwality Wall's : Pleasure Up Brand: Kwality Wall's

Company: HLL

Agency: McCann Erickson

Brand Count: 143

Kwality Wall's is one of the major brands in the Indian

ice-cream industry. The brand Kwality ice-cream which

was one of the first ice-cream brand of India came in into

existance in 1940. In 1956, the brand which was a local

brand began to spread its wings. In 1995, Kwality Ice-

cream came into HLL's fold and is now marketed as

Kwality Wall's.

Market demandThe Indian icecream market is estimated to be around Rs 1500-2000 crore with the organised market hovering around 600 crore. Kwality Wall's had a market share of around 40% of this segment. Although HLL and Amul is claiming leadership in the Indian Icecream market, the fact is that the market is highly fragmented and increasingly commoditised.

Amul entered the icecream market with a low price that changed the entire dynamics of the game. Kwality Wall's could not sustain the price competition and withdrew from the mass market. This has resulted in Amul gaining the market leadership position with around 27 % and Kwality walls reduced itself as a premium player. ( the market share figures are terribly confusing ).

With so many players in the market with little differentiation, the market is facing the issue of commoditisation. Flavour, taste, quality and Branding are the major differentiation opportunities in this industry. Flavour and product varieties were the route taken by major players. But flavours/varieties can be easily replicated by the competitors. Hence the only meaningful differentiation could be the brand.

Kwality Wall's has some of the blockbuster product varieties up in its fold like the Cornetto, Feast, Viennetta. But could not sustain because the same was imitated by the competitors.Cornetto became a generic name but HLL could not capitalise on that popularity.

Amul took the life out of Kwality by positioning itself as “The Real Icecream" since Kwality is mainly made of vegetable oils.

Kwality Wall's since the onslaught of Amul has faced positioning issues. The brand had struck a reasonably good positioning as a “Connector of Hearts" . The brand had the famous tagline " ho Jaye Dil Ka Connection" and some good ad campaigns. But the the brand began to go haywhere.

The positioning changed and so has the quality of the campaigns. There was no need to change the positioning. But someone at the company was bored by this.

The recent tagline of Kwality Wall's is “Pleasure Up" which could be mistook for a tagline for an Aphrodisiac. The ads also could not be viewed with family . When I first saw the campaign i mistook it for a condom Ad.

The marketer at HLL is totally confused about the brand values, the basic STP and all marketing fundas. The owners are too obsessed with the dictum “Sex Sells” or they are too desperate about this brand. While Amul carefully connecting its corporate image with their icecream brand, Kwality Wall's is repelling its existing customers. Kwality Wall's should be positioning itself as family brand with quality and variety as its major strength's. There is also a space for a subbrand in the youth category . The task is to create an excitement in

the market with promotions and new product introductions. But Kwality Wall's is wasting its money in positioning itself as a “Sexy " brand.

With the whole icecream segment becoming commoditised, it takes lot of careful strategic brand management to survive. Kwality is facing its worst crisis in its life. It has to find a platform otherwise, it is going to be out of this market.

Comparison between Amul ice-cream &

Kwality Wall’s

The ice cream market growth picked up after de-reservation of the sector in 1997. Of the total size of Rs 15-16bn, around 30-32% is in the hands of organized sector valued at Rs 4.9bn, rest all is with the unorganized sector. Among the major players in this industry Hindustan Lever has a market share of around 50%, represented mainly by Kwality Walls brand. Amul with an estimated market share of 35% was rapidly gaining market

share and lastly Vadilal is the player in the national market with 8-9% of the market share

market share - 1997

(HLL )Kwality Wall's AmulVadilalOthers

As per recent research Rs 2,900-crore Gujarat Co-operative Milk Marketing Federation Ltd (GCMMF) is spreading its wings overseas for Amul ice-creams. As part of the strategy, GCMMF is eyeing the Middle East countries and Hong Kong for exports of Amul ice-creams in 2004. GCMMF has recently started exporting Amul tetrapak milk to these countries. It has also been exporting Amul ice-creams and tetrapak milk to

Singapore since the last one year. Enthused by the demand from Singapore, GCMMF has become aggressive on the export front for Amul ice-creams, GCMMF general manager (dairy line) RS Sodhi told FE.

As for the Indian market, GCMMF has recently chalked out aggressive marketing plans to expand the Rs 600-crore organised ice-cream market in 2004. “We are now planning to beef up our distribution network for Amul ice-creams from 26,000 to 35,000 retail outlets and expand our exclusive ‘Amul Preferred Outlets’ from 110 to 600 across the country so that the production matches demand,” he said.

GCMMF has also recently upgraded the packaging design of its ‘Amul Utterly Butterly Delicious’ ice-cream packs. It has priced Amul ice-creams more competitively by providing more variety in the premium range this summer. “For example, on the purchase of one ‘Amul Party’ pack, customers can avail of another similar pack free of cost, ‘Amul Double Sundaes’ are now available for Rs 75 instead of Rs 100, and ‘Amul Sundae Magic’ is priced at Rs 60. Our ‘Amul Cake Ice-cream’, which is priced at Rs 200 for a 2- litre pack across the country, has taken off well this summer,” he said.

Further, GCMMF is also looking at increasing penetration levels for ‘Double Tone Milk’ and tetrapak milk in the Indian market to spur more volumes.

With the new marketing initiatives, Mr. Sodhi said GCMMF is looking at a volume growth of 50 per cent for Amul ice-creams. This is because this year the summer is good, prices are competitive, the distribution network is in

place, and most importantly, production is matching demand.

In fact, GCMMF’s 50 per cent volume growth for Amul ice-creams is five times more than Hindustan Lever Ltd’s Kwality Walls ice-creams.

In the ice-creams segment, Amul is the market leader

with 32 per cent market share, while Kwality Walls has 8

per cent market share and

Vadilal and Mother Dairy 7 per cent market share each, at

present.

Market share at present

AmulKwality Wall'sVadilalMother Dairyothers

Conclusion

AMUL means "priceless" in Sanskrit. The brand name "Amul," from the Sanskrit "Amoolya," was

suggested by a quality control expert in Anand. Variants, all meaning "priceless", are found in several

Indian languages. 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. (Turnover: Rs. 52.55

billion in 2007-08). 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.

Finally, I shall make a small observation on an institution that has been quietly serving as the

intellectual and managerial backbone of the Amul Pattern for the last 25 years. The Institute of Rural

Management, Anand is the soul of the Amul Pattern. IRMA lives in the collective consciousness of the

farmers of Amul Pattern cooperatives and in the success of Amul. It represents the very spirit of Amul.

Maintaining and defending its essence is the responsibility of every person who has a stake in the

development of rural India.