World’s Largest Pouched MilkWorld’s BrandBiggestVegetarianCheeseBrand
Presented By -- hARSHAD BAFNA -- RISHABH CHOPRA
~ AMUL, an Introduction & History~ Reasons for Success and its Growth rate~ AMUL- Business Model & Business Strategy~ IndustryAnalysis & 3 C’s of AMUL~ SWOT Analysis & BCG Matrix of Amul~ Market Segmentation- Customer Based &IndustryBased~ AMUL Product Portfolio & its Product Strategy~ Competitive sustainable advantage (CSA) of AMUL` AMUL is going Globally…………….
Introduction & HistoryFormed in 1946, is a dairy cooperative movement in India with 250liters of milk per day with name KAIRA DISTRICT CO-OPERATIVEMILK PRODUCERS’ UNION.A brand name AMUL is managed by Gujarat Co-operative MilkMarketing Federation Ltd. (GCMMF).The brand name Amul means “AMULYA” (suggested by a qualitycontrol expert in Anand). This word derived form the Sanskrit word“AMULYA” which means “PRICELESS”.Amul has spurred the white revolution of India, which has made Indiathe largest producer of milk and milk products in the world and theWhite Revolution has finally created a billion-dollar brand.Today Amul dairy is No. 1 dairy in Asia and No. 2 in the world d, whichis matter of proud for Gujarat and whole India.Amul has more than 150 chilling centers in various villages.Dr. Varghese Kurien, former chairman of the GCMMF – the man behindthe success of Amul.
REASON FOR SUCCESS Robust Supply Chain Low Cost StrategySUCCESS Diverse product mix Amul Butter, Ghee, Milk Powder, Cheese, !! Chocolate, Shrikhand, Ice Cream, Amulspray, Milk, Nutramul And Amulya Strong Distribution network Technologhy And E-Initiatives
Amul Growth RateAnnual Turnover of 4300 Crore (2006-07)Rs 10000 Crore mark in 2010Five decade to became Rs 2000 Crore entity but the turn overdoubled to over Rs 4300 crore within nineyears form 1999-07 Annual Turnover 10000 10000 9000 8000 AGR:32% 7000 6000 5000 4300 4000 3000 2000 2000 1000 0 0 1946 1999 2007 2008 2009 2010
Amul — Bussiness MOdel RAW MILK Condensed Packaged Milk Dried Ghee Skimmed Milk Ice cream Butter Powder Beverages CreamEvery day Amul Collects 7 million liters of milk from 2.6 millionformers, converts the milk into branded, packed products and deliversgoods to over 5,00,000 retail outlets across the country.Its supply chain one of the most complicated in the world.
Amul Bussiness Strategy Developing demand Limited purchasing power, modest consumption levelsA low-cost price strategy products The distribution network Dry and cold warehouse Cash transaction throughout the supply chain JI T improves dealers returns on investments (ROI) Umbrella brand common brand for most product categories Alums sub-brands , edible oil products - Dhara, mineral water - Jal Dhara brand while fruit drinks - Safal Third party service providers core is milk processing , production of dairy products logistics of milk collection, distribution of dairy products, sale of products through dealers and retail stores
SWOT analysis of AMUL Strengths Weakness Largest food brand in India & Asia Strong dependency on weak High Quality, Low Price infrastructure & completely dependent Introduced TQM on villages for its raw materialsWorld’s Largest Pouched Milk Brand Risks of highly complex supply chain Annual turnover of system 4300Crore(2006-07) Short self life of its Products Highly Diverse Product Mix Alliance with third parties who do not belong to the organized sector Robust Distribution Network Threats Opportunities Competitors- HindustanPenetrate international markets lever, Nestle, Britannia and Local players Diversify product portfolio to Stiff competitions from MNC’s in butterentre new products categories and Growing price of milk and milk expand existing categories like products processed foods, chocolates etc. Ban on exports of milk powder Use internet to sell its products The yield of India cattle still much lower than other dairy countries.
Industry Analysis: Porter’s 5 Forces Threat of new entrants Is high because There are no entry barriers Bargaining Competitive Bargaining Power of Rivalry is Power of Suppliers is High due to customers islow because Other High becausethe suppliers brands and of variousAre rural milk Local players competitors producers Threats of substitutes is high because of availability of Other products
The 3 C’s Model ….. Customer extremelyAggressive moves against satisfiedBritannia, Nestle, mother Dairy and Moves from loose milk toKwality Packaged milk. Largest milk brand in Asia Market leader in ghee and butter Very strong supply chain
Mix… Product for every one o Amul never forget its “primary customer” - Amul collects 7 million liters of milk from 2.6 million formers(many ittiterate) o Product for youth - Amul launches Chocolate milk under brand name “AMUL KOOL KOKO” targeting the youth o Product for diabetic people -India’s First pro-Biotic Wellness Ice cream & Sugar Free Delights For Diabetics
Mix… Product for every one oProduct for the health conscious - Amul Launched “low fat, low cholesterol bread spreads” oProduct for the price sensitive India - Low Priced Amul Ice Creams and affordable ‘sagar’ whitener oProduct for the urban class - Amul launched emmental, gouda and pizza mozzarella cheese
Advertisements AMUL is well known for its innovative hoardings as shownin this slide.
Product PositioningPlacing a product in that part of the market where it will receivefavorableReception compared to competing products.Positioning of Amul is “TASTE of INDIA”. It has created value foreveryone on value chain, be it customer or farmers.USP- Quality with affordabilityIndia’s First Pro- Biotic WellnessIce cream& Sugar Free DelightsFor DiabeticsLow priced Amul Ice creammade Kwality Walls life hell.
Positioning Continued….Flank Attack Age Wise.. Aug 25 2007Amul launches Chocolate milk under brandname of “AMUL KOOL KOKO”.This is targeted at teenagers and youths.Nov 11, 2007: Amul in multinational Arean WithSnack Launch: “Munch Time”. Flavors: Masala, Mint and Tomato. New Product Activity.Nov 26,2007: Amul Launches “Fresh Panner”(Free From Any Harmful Chemicals)Flank Attack---Expanding its Cheese Segment.Current market share 50%
Product Repositioning New CompetitionChange in consumer preferenceWrong original positioningAmul marketed bottle water product named“JALDHARA” but to less potential in the market itTurned out to be blunder.Now Amul is all set to launch bottled water“NARMADA NEER”
Product Overlaps Situation where company decides to Complete against its own brands. Powdered milk Health and price Conscious. “SAGAR Vs Amulya”.USP: Sagar is affordable whitener for health conscious one. Cheese spreads Specific Vs General“Amul Processed Cheese Vs Cheese Spread”USP: Cheese spread is highly accepted spread for regular use. Milk drinks“Nutramul Energy Drink Vs Amul Kool”
Product design Strategy“Whether to offer standard or customized prducts.”Amul has offered a mix of both standard and customizedproducts.Use of Utterly-Butterly Girl:Using since 1967,Entered in the Guinness Book of World Records for beingthe longest running campaign Ever.
Product Elimination & Diversification Product reaches the stage Seeking unfamiliar productswhere continued support is no or market or both in thelonger justified where pursuits of growth.performance is falling short of Secrets of Amul’sexpectations, it is Diversification Philosophy:desirable to pull the product Progressive addition ofout of the market place. higher value products while maintaining the desire growthIt eliminated in existing products.“JALDHARA” a decade Amul introduced productsago as Bottled water product with consistent value additiondo not have potential but never left the corecustomers”. philosophy of “providing mill at basic & at affordable price”
Amul Products Diversification
Benefits of Diversification &Value Marketing StrategyHigh Growth Providing a product thatExpansion of works as claimed, isnetwork accompanied by decent service, and is delivered onAdvantage of each time.underline Value for moneyobjectives. The generation forCommitment to awareness.quality. Fostering of Loyalty.
Amul has Competitive sustainable advantage (CSA) over its competitorsAmul’s CSA lies in its procurement part ,the ability to collect7million liters of milk from 2.6 million formers, convert theminto goods worth Rs 6crore and distribute them to 5,00,000retailers across country ,is not easy. No other dairy in Indiahas such a sustainable procurement network.Managing the large scale supply chain of Amul which beginsfrom milk producer and ends with supply to customer fromretailer is very critical job. It requires lot of dedication andhard work from all members of the corporation and alsodistributors and retailers across country.Intelligent Marketing of Amul
Intelligent Marketingo One of the most conservative FMCG entitiesGCMMF- Spends a mere 1% of its turnover on n promotions.o GCMMF has written and re-written rules of thegame.o Amul butter girl is one of the longest run adcampaigns in the country for 41 years.o Intelligent marketing of milk, ice cream and buttermilk.o GCMMF (AMUL) Beats Recession, Achieves, A Turnover Of Rs. 6700Crores (June 05, 2009)
Amul is going globally…..GCMMF has signed an agreement with Wal-Mart to stock its shelves withproducts under its Amul brand name. Amul processed cheese, pure ghee,shrikhand, Nutramul, Amul’s Mithaee Gulab Jamuns are few of the productsmarketed in US markets.50% of Americans being medically obese & if Amul is really looking tocapture the hearts of the 2nd and 3rd of Indians, offering low-fat versions of itsbrands, would make a lot of commercial sense. Hence targeting the largeIndian community in the USmarkets with its niche products like Mithai, Packaged ready to eat footsmarket, it can definitely expand its market to a large extent.Overseas markets- Mauritius, UAE, Bangladesh, Australia, China, Singapore,Malaysia , Nepal, Pakistan, Hong Kong and a few South African countries.Fresh plans of flooding the markets of Japan & Srilanka.Tie up with Glaxo to sell baby food…
What more can Amul do??Amul can try out the following ideas: I) Amul can venture out on new products like Toned milk,Condensed milk that can be used for sweets, Baby food products, II) There are certain product like Amul basundi, gulab jamoon,chocolates etc which are not as popular as Amul ice cream. Amulmust try to understand the cause of this through thorough marketresearch and work on improving these products III) Though Amul’s hoardings are a huge success, it canpenetrate even better in the rural areas by advertising through themedia via cable channels and newspapers. Sponsoring shows inTV, sports events can be of great help.
WHY AMULPhysique: Personality:Taste, Quality Simple, Indian Culture:Relationship: Co-operative,Sociable sharing Self image: Reflection: Proud Indian, Fun Value oriented loving