it’s a milky way

8/2/2019 Its a Milky Way

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Its a Milky Way


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Case Study: The scorching summer this year has ensured a strong double-digit

growth for soft drink companies. The biggest grosser being the new lemon category where the annual

consumption is pegged around Rs. 100 crore.

Even while lemon was the flavour of the season, backed by high-decibel advertising by the likes of Coca-Cola India and Parle Agro.

For Parle, the non carbonated soft drink category clocked 26%growth this year, the company grew faster than the market,registering a 30% growth.

Coca-Cola India, on the other hand, has delivered 15 consecutivequarters of growth, out of which 12 quarters have seen double-digitgrowth.

Coca-Cola India's unit case volume grew by 29%. It involved sharegains across key beverage categories --both in sparkling and in stills.

According to an independent beverage industry report, close to 120billion litre of beverages gets consumed in India annually.

Industry observers said that 55% of sales of Indian soft drink industrycomes during the summer.


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Case Study: This presents a huge window of opportunity to generate

maximum growth during the season. The reason beverage majors are focusing on the juices

category, is because of the most noticeable trend of a rise inhealth consciousness among consumers.

In the 660-millioncase juice market in India, lemon has

emerged as the number one flavour with a 48% share. The lemon drink category presents a huge untapped

opportunity.

For instance the brand LMN has created a category of its ownand not eaten into existing categories.

It seems the older generation has started experimenting withproducts and services traditionally meant for the youngergeneration.

Marketers need to keep tabs on how conscious customers are,in terms of the value they derive from brands. In thiscompetitive market it is clear that customers will pay more for

value.


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Case Study:

Can a beverage brand give benefits other than quenchingthirst?

The future is about high quality benefits and price.

Coke has announced its entry into Milk based beverageswith the product Maaza Milky Delite.

It is to test the same for two months in Kolkata beforelaunching it nationally.

The product, priced at Rs 15 for a 200-ml pack, would be madeavailable across 3,000 outlets in the city.

The company believes, extension of the Maaza franchisee intomilk-based beverages will allow them to leverage Maazasgoodwill.

This is Coca-Colas third fruit-based beverage product afterMinute Maid Pulpy Orange and Minute Maid Nimbu Fresh,which it launched in 2007 and 2010, respectively.


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Case Study:

While Amul and Britannia also have milk beverages in theirportfolio.

While 48% of the fruit-based drinks market in India isdominated by Nimbu, the share of mango is estimated to be at23%.

Branded juices have a 4% share of this market. Its estimatedthat over 2.5 billion unit cases of dairy are consumed in Indiaevery year.

PepsiCo India has expanded its product portfolio with the

launch of Pepsi Max, a sugar-less cola brand with a strongertaste.

Targeted at the health-conscious consumers in the 25 to 35years age group, the cola will initially be available in New Delhi.

The branded beverages market in the country is estimated to

be Rs10,000 crore.


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Case Study:

Britannia Industries dairy division is taking a 2nd shot at theflavoured milk business, which it had entered under the brandname Zip Sip.

This time the focus is on products fortified with essentialmicronutrients. ActiMind, a milk-based drink with seven

micronutrients, was launched in Tamil Nadu a few months ago. More recently, Britannia launched TigerZor, a chocolate

beverage with five micronutrients, in Hyderabad andBangalore.

The products are being marketed as nutrition-in-a-bottle andpriced a little higher than regular flavoured milk brands.

The company was not interested in being in the generalcategory, which was already crowded.

The company desires a profitable growth for a long time and is

not interested in growth at any cost.


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Case Study:

The flavoured milk market, estimated at about Rs 250-crore,has brands like Amul Kool, Nestles Milkmaid Funshake, MTR,Yakults probiotic milk and Danones chocolate smoothie ChocoPlus, as also many local ones.

The value-based milk category has seen a lot of action with

low-fat, fortified, soy and probiotic milk variants. Nutrient fortification is a key element of Britannias strategy.

Indians in general were not very conscious about what theyeat.

Nearly 68% of school-going children in India were anaemic,and this figure was agnostic to socio-economic status.

Britannia believes that this necessitates putting nutrients intofoods that children like, and that there is growing recognition ofthis.


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Case Study:

Britannias dairy business, which also has products like dairy

whitener, ultrahigh temperature milk, cheese, butter and ghee,had revenues of Rs 210 crore in the last financial year.

It has seen a five-year CAGR of 17% and the same has been22% in the last two years. The operating margins in the dairy

business were higher than in the biscuits business, where itcaters also to the mass market with products like the Tigerglucose biscuit.


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Should Pepsi look at the move from Coke as anopportunity and enter with a Product (Milk Based) inCompetition? If yes suggest a Product Strategy. OrShould Pepsi look at this wonderful opportunity to

take on Coke in the carbonated beverages segmentaggressively and create a big dent in Market Share?

Suggest a Suitable Strategy.


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Pepsi:

Pepsi in 2010, investedin a russian milk basedgiant Wimm-Bill-Dann.

Also joined hands withBen & Jerry to launch a

new line of dairy basedbeverages.

Pepsi has confirmedthat it would enter in the

Indian milk basedbeverage market andhas set up an R&Dcentre near Gurgaon onthe same lines.


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Pepsi: Thought Porters 5 Forces

Rivalry withCoke, Localplayers like

Amul

New entrants would

be local players.However, can cause

damage owing to vastspread network.

Bargaining

power ofbuyers wouldbe strong,

however, wouldalso pay pricefor premium

drinks

Milk based beverages can bedifferentiated as regular and

value added milk based products.As more and more people are

getting health conscious, this mistbe a threat.

Suppliersare

numerous insupply.


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Pepsi:

Traditionally, there are videos andinformation on the internet that Pepsi canbe mixed with milk.

Similar videos of coke resemble aneruption.

Pepsi, thus, can intend to enter thedifferentiated brand and be the firstlauncher of carbonated milk based drink.

Also, there are numerous brands in the

market which are rich in traditional flavorslike Badam, Elaichi, Kesar, Chocolate.

Pepsi also has an option to enter into thefruit based milk beverage products, butwould be facing its all time rival coke in

the segment.


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The Brand Coke is synonymous to a Carbonated Drinkand caters to a customer base with specificcharacteristics. Can the company really leverage thebrand COKE across Milk Based products againstestablished players like Amul, Britannia etc? Plan aPromotional Strategy for the Brand.


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Coke:

Coke would have toconduct a customerexperience surveywherein the perception ofcoke as a milk basedbrand would have to be

evaluated. However, the Minute Maid

category has alreadycome to be representedas Cokes non carbonated

beverage branch. To keep up with the image

of coke as a carbonateddrink, it launched its fizzydrink in the US. (troublefor pepsi!!)


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Coke:

Since Maaza is already a

pretty established brand, itcan serve as a goodtagline.

In fact, Maaza milkydelight can be segmented

as a health based milkbeverage.

If so, it can be promotedacross local hoardings.

Traditionally, carbonated

drinks are cool and thus,Maaza is generallyuncommon in youngsters.

Thus, the milky versioncan have a target market

as grown up adults.


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Coke: Marketing Strategy

Extensive advertising tosimulate the Milk

version.

May required freesampling booths atsupermarkets.

Amul and Britannia arehaving products which arenot fruit based milk

beverages. They aresimply flavour basedbeverages.

This gives Coke a position

of advantage.


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Considering that Parle is fighting with Britannia fiercelyin the Biscuits segment, should they follow through

and up the Ante against Britannia in the Value basedMilk Category as well.


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Parle - History:

Frooti launched in 1985 still a popular drink

Appy launched in 1986 still a popular drink

Appy fizz launched in2005 became popularamongst the younggeneration


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ParleSWOT Analysis (I):

Strengths: Parle Brand

Diversified ProductRange

Extensive Distribution

Network Low & Mid Price Range

Catering to Mass

Better Understanding ofConsumer Psyche

Weaknesses: Dependence on retailers

& Grocery stores

Dependence on Parle G


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ParleSWOT Analysis (II):

Opportunities: Estimated annual growth of

20%

Low Per capitaConsumption

Changing Consumer

preference Increasing demand for

sugar free, diet drinks

Threats: Hike in cost of production

due to hike in cost of rawmaterials

Increasing distribution cost Local products

Entry of various newEntrants


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A company which could loose a lot in terms ofheightened competition within this market is AMUL.What product strategies relevant to growth would

you suggest for AMUL?


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Amul: Marketing Mix

Product: Dairy Products

Pricing:

Low Pricing

Place: Rural

Urban

International

Promotion: Advertisements


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Amul: Defense Strategy

Moving Consumersfrom Loose Milk to

packaged milk

Being exposed to thebrand, consumers tryout different products


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Amul: Staying Ahead

Attack existing playersthrough :

Aggressive Pricing

Better Quality

Enhanced DistributionNetwork

Strong Marketing Push


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ITC wishes to enter the market for Milk Beverages aswell. Suggest a suitable Product Portfolio for the

company. Explain competition that you anticipate forthe products and propose few contingency

strategies.


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ITC: Product Portfolio

Milk Products: Strawberry Milk

Pineapple Milk

Chocolate Milk

Butterscotch Milk Cold Coffee

Iced Tea

Lemon Flavour

Peach Flavour


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ITC: Competition

Amul Nestle

Mother Dairy

Britannia

Nilgiris

CavinKare Dairy

GRB Dairy

CreamLine Dairy Parag Milk Foods

Hatsun


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ITC: Product Strategy

Price Strategy: Rs. 17/-

Product Strategy: Attractive Packaging

Easy to carry

Promotion Strategy: Target the health

conscious upper middleclass & Gen Y

Have give-aways Place Strategy:

Malls

Supermarkets


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it’s a milky way

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