An effective study on promotional activities of nandini milk


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Effective study on promotional activities of Nandini milk (KMF)

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An effective study on promotional activities of nandini milk

  1. 1. Promotional Activities Introduction Sales promotion is an important component of a small business's overall marketing strategy, along with advertising, public relations, and personal selling. The American Marketing Association (AMA) defines sales promotion as "media and non-media marketing pressure applied for a predetermined, limited period of time in order to stimulate trial, increase consumer demand, or improve product quality." But this definition does not capture all the elements of modern sales promotion. One should add that effective sales promotion increases the basic value of a product for a limited time and directly stimulates consumer purchasing, selling effectiveness, or the effort of the sales force. It can be used to inform, persuade, and remind target customers about the business and its marketing mix. Some common types of sales promotion include samples, coupons, sweepstakes, contests, in-store displays, trade shows, price- off deals, premiums, and rebates. Businesses can target sales promotions at three different audiences: consumers, resellers, and the company's own sales force. Sales promotion acts as a competitive weapon by providing an extra incentive for the target audience to purchase or support one brand over another. It is particularly effective in spurring product trial and unplanned purchases. Most marketers believe that a given product or service has an established perceived price or value, and they use sales promotion to change this price-value relationship by increasing the value and/or lowering the price. Compared to the other components of the marketing mix (advertising, publicity, and personal selling), sales promotion usually operates on a shorter time line, uses a more rational appeal, returns a tangible or real value, fosters an immediate sale, and contributes highly to profitability. In determining the relative importance to place on sales promotion in the overall marketing mix, a small business should consider its marketing budget, the stage of the product in its life cycle, the nature of competition in the market, the target of the promotion, and the nature of the product. For example, sales promotion and direct mail are particularly attractive alternatives when the marketing budget is limited, as it H.R. Institute of Higher Education, Hassan. Page 1
  2. 2. Promotional Activities is for many small businesses. In addition, sales promotion can be an effective tool in a highly competitive market, when the objective is to convince retailers to carry Product or influence consumers to select it over those of competitors. Similarly, sales promotion is often used in the growth and maturity stages of the product life cycle to stimulate consumers and resellers to choose that product over the competition—rather than in the introduction stage, when mass advertising to build awareness might be more important. Finally, sales promotion tends to work best when it is applied to impulse items whose features can be judged at the point of purchase, rather than more complex, expensive items that might require hands-on demonstration. H.R. Institute of Higher Education, Hassan. Page 2
  3. 3. Promotional Activities Statement of the Problem:- At present in this competitive business world the milk industry has more brands in the battle field facing stiff competition in every segment’s targeted. Even brand Nandini is also facing stiff competition to retain brand in the market. There are many players in the market in this industry and their own promotional strategies where is to inducing the different consumer segment. Hence due to this it is crucial to analyze the promotional strategies of Nandini and its competitors to penetrate the targeted market. In this juncture it has to identify its competitors in this market by bringing brand awareness in the minds of consumers and also it has to cope up with the updated advertising and sales promotional strategies. Through this study, the main problem that it studies during this project work is to find out the effectiveness of the reach of different sales promotion techniques to the consumers and the awareness of brand among the consumers of Hassan district. Objectives of the study:- • To study the effectiveness of the various sales promotion. • To study the brand awareness of Nandini milk and its milk products. • To know the consumer response. Scope of the Study:- The main purpose of the study is to identify the awareness of branding system and sales promotion program adopted by various producers engaged in the production of milk products and in specific relation to Nandini products. In order to know the Brand Awareness of Nandani milk and its milk products. To study the reach of branding system and sales promotion programme of Nandini products among the consumers of Hassan district. H.R. Institute of Higher Education, Hassan. Page 3
  4. 4. Promotional Activities Research Methodology The formidable problem that follows the task of designing the research project is known as the "Research Design". The design of a quantitative research study includes the method for collecting the data. The sample design and construction of the data collection instrument. 1. Purpose of enquiry: The scope of the enquiry is to support the data required to make study on “An effective study on promotional activities of Nandini Milk and it’s Products”. 2. Scope of data: The scope of enquiry is limited to the study of the topic concerned only. 3. Sources of data: The data collected through primary data. A. Nature and type of enquiry: Non-official Non-confidential. B. Direct: There is 100 degree of accuracy. Sampling Design A sample size of 100 respondents was covered. Random sampling procedure of survey was conducted on the primary data. Respondents were classified on the basis of their age etc. Respondents were interviewed at Few areas in Hassan City. Sources Of Data Collection The task of data collection begins after a research problem has defined & Research design of plan cooked out. There are 2 basis ways of data collection. Primary Data  A detailed questionnaire was handed over to a chosen sample.  Frequent Purchasers of Nandini Milk and its milk products. H.R. Institute of Higher Education, Hassan. Page 4
  5. 5. Promotional Activities  Interaction with Customer.  Discussion with KMF Marketing Manager and Assistant Manager in the Department. Secondary Data  Product broachers.  Previous annual report.  Magazines & journals.  Internet. Techniques for Data Analysis; Questionnaire method was used as research instrument for this study. Closed ended questionnaires are used for the customers to an Limitations of the Study;  Time constraint has prohibited from going deep into the subject.  The information obtained or the collection of data is limited.  The study is purely academic.  Due to time constraints the study is restrict to Hassan city only.  The survey was conducted in this urban sector of respondents thus it cannot be generalized.  The information provided by respondents could be biased. H.R. Institute of Higher Education, Hassan. Page 5
  6. 6. Promotional Activities Company Profile 2.1 Industry Scenario Dairy is a place where handling of milk and its milk products is done and technology refers to the application of scientific knowledge for practical purposes. Dairy technology has been defined as that branch of dairy science, which deals with the processing of milk and the manufacture of milk products on an industrial scale. In developed dairying countries such as the USA, the year 1850 is seen as the dividing line between farm and factory scale production. Various factors contributed to the change in these countries viz., concentration of population in cities where jobs were plentiful, rapid industrialization, improvement of transportation facilities, development of machines etc., where as the rural areas were identified for milk production, the urban centers were selected for the location of milk processing plants and product manufacturing factories. These plants and factories were rapidly expanded and modernized with improved machinery and equipment to secure the various advantages of large-scale production. Nearly all the milk in the USA before 1900 was delivered as raw (nature) milk. Once pasteurization was introduced, it developed rapidly. Mechanical refrigeration helped in the rapid development of the factory system of market distribution. Milk Milk may be defined as whole, fresh, clear lacteal suretion obtained by the complete milking of healthier milk animals. It represents the perfect food for man nearly than any other natural food. An adequate consumption of milk can correct dieting deficiencies for most people strong, healthy bodies. It is delicious and appetizing food as well as being healthful. H.R. Institute of Higher Education, Hassan. Page 6
  7. 7. Promotional Activities The major constituents of milk are water, fat, protein, lactose and mineral water. The major constituents are phospholipids, sterols, vitamins, enzymes, pigments etc. The true constraints are milk fat, casein and lactose. Milk is absolutely essential for the welfare of the human race. The cow has been rightly called, “The Foster Mother of Human Race” and she is found in most of the civilized countries of the earth. 2.1.1 Asian Dairy Scene With 60% of the world population, Asia accounts for only 20% of the global milk production. The total world production of more than 500 million tonnes for a population of about 4 billion amounts to and average annual per capita availability of 100kg. The corresponding figure for Asia is only about 27 kg and the consumption is about 30kg. Some 10% of milk consumed in Asia is imported. In several Asian countries, imports of dairy products, both as finished products in consumer packs and in bulk for recombination in to milk have helped create a dairy market and a milk processing industry. The Asian countries have been producing over 96% of the world’s buffalo milk output, estimated at 48 million tonnes, India accounts for more than 30% of it. The recent formation of the Asian Buffalo Association will help overcome the neglect that the buffalo has suffered for decades. 2.1.2 Dairy in India In India, dairying has been practiced as a rural cottage industry since the remote part. Semi-commercial dairying started with the establishment of military dairy farms and co-operative milk unions throughout the country towards the end of nineteenth century. During the earlier year, each household in those countries maintained its family cow or secured milk from its neighbor who supplied those living close by. As the urban population increase, fewer households could keep a cow for private use. The high cost of milk production, problems of sanitation etc., restricted the practice, and gradually the family row in the city was eliminated and city cattle were all sent back to the rural areas. H.R. Institute of Higher Education, Hassan. Page 7
  8. 8. Promotional Activities The Indian dairy industry has made rapid progress since independence. A large number of modern milk plants and product factories have since been established. These organized dairies have been successfully engaged in the routine commercial production of pasteurized bottled milk and various western and Indian dairy products. With modern knowledge of the protection of milk during transportation, it become possible to locate dairies where land was less expensive and crops could be grown more economically. In India, the market milk technology may be considered to have commenced in 1950 with the functioning of the Central Dairy of Aarey milk colony, and milk product technology in 1956 with the establishment of AMUL dairy, Anand. The industry is still in its infancy and barely 10% of our milk productions under goes organized handling. 2.1.3 History of Indian Market Milk Industry • Organized milk handling was made in India with the establishment of Military Dairy Farms. • Handling of milk in co-operative milk unions established all over the country on a small scale in early stages. • Long distance refrigerated rail-transport of milk from Anand to Bombay since 1945. • Pasteurization and bottling of milk on a large scale for organized distributed was started at Aarey - 1950 Calcutta(Haringhata) - 1958 Delhi - 1959 Worli - 1961 Madras - 1963 • Establishment of milk plants under the 3- year plans for dairy development all over India. They were taken up with the dual object of increasing the national H.R. Institute of Higher Education, Hassan. Page 8
  9. 9. Promotional Activities level of milk consumption and ensuring better returns to the primary milk producer. These main aims were to produce more, better and cheaper milk. In terms of percentages we have 51% of the Asian population. Amul A situation prevailed in the case of milk about 30 years ago; when the exploitation by middlemen had forced the milk producers to sell milk at throw prices. The answer to such a situation was found in developing a system that enables milk producers to own and operate, not only their processing facility, but also the inputs, delivery machinery, and the marketing of finished products. The integrated approach first proved very successful in Kaira-the AMUL organization and through the Operation Flood Programme, aimed to establish similar farmer’s organizations in 18 districts in the country. The Programme when implemented did face some preliminary problems, but these were overcome, so much so that when the IBRD and World Bank came forward to finance dairy projects in Karnataka, Rajasthan and Madhya Pradesh. The results were that 13 milk producers’ co-operative unions were established. Based on the success of these 30 unions, bodies owned by the farmers themselves. The other phase of dairy development, Operation Flood II, being implemented to bring the total number of such district unions to 155, and cover some 10 million farmers. The success of these 30 unions have further demonstrated that problems can best solved if the agency implementing the programme is owned and operated by the producers themselves, who employ the best professionals that the responsibility of such an organization is not only to guarantee a remunerative market for the rurally produced commodity by its member producers, but also guarantees a package of input for enhancing production (milk) and ploughs back the profit for further development. Again, in the case of milk, since marketing of the product was largely controlled by middlemen/trade/cattle keepers/etc., the organized dairy was not in a position to pay a better price to the milk producers. Market intervention was therefore required to enable these dairies to supply milk to the consumers at reasonable prices. This was the first time that food aid skimmed milk powder, and butter oil in this case-was used to prime the pump of the modern dairies in four metropolitan cities (Calcutta, Bombay, Delhi and Madras), and permit them to demand on all much large scale. The funds generated through the sale of skimmed H.R. Institute of Higher Education, Hassan. Page 9
  10. 10. Promotional Activities milk powder and butter oil were used to build up farmer’s organizations in the milk sheds those supplies to these metropolitan cities. 2.1.4 Achievements of Dairy co-operatives in India Dairy co-operative society is a basic organization unit functioning at the village level.  Reach The Dairy Co-operative network • Includes 170 milk unions. • Operates in over 285 districts. • Covers nearly 1, 01,000 village level societies. • Is owned by nearly 11 million farmer members.  Milk Production • India’s milk production increased from 21.2 million MT in 1968 to 84.6 million MT in 2001-02. • Per capita availability of milk presently is 226 grams per day, up from 112 grams per day in 1968-69. • India’s 4% annual growth of milk production surpasses the 2% growth in population; the net increase in availability is around 2% per year.  Marketing • In 2001-02, average daily co-operative milk marketing stood at 134.23 lakh litres, annual growth has averaged about 5% compounded over the last 5 years. • Dairy co-operative now market milk in about 200 cities including metros and some 550 smaller towns. • During the last decade, the dairy milk supply to each 100 urban consumers has increased from 175 to 473 liters.  Innovation • Bulk-vending-saving money and the environment. • Milk travels as far 2200 kilometers to deficit areas, carried by innovative rail and road milk tankers. H.R. Institute of Higher Education, Hassan. Page 10
  11. 11. Promotional Activities • Ninety five percent of dairy equipment is produced in India, saving valuable foreign exchange 2.2 Company Profile HASSAN CO-OPERATIVE MILK PRODUCERS SOCIETIES UNION LTD, was established with an aim to support small, marginal farmers and agricultural laborers through dairy development. As the farmers are not sure of receiving a remunerative price for their agricultural produce more and more farmers are taking up dairying as their main occupation rather than subsidiary occupation for their livelihood. The milk union is committed to accept all the milk offered by the milk producers in the milk shed area and hence there is a considerable increase in milk procurement during 2004-05, 2005-06 & 2006-07. We at Hassan Milk Union believe that it is a social obligation on part of the union to pay remunerative price to the farmers and hence we have entered new and far off markets like, Pune and kolhapur in Maharastra, Trivendrum and Kollam in Kerala 2.2.1 Background and Inspection of The Company: H.R. Institute of Higher Education, Hassan. Page 11
  12. 12. Promotional Activities The Hassan Unit started its Dairy development activity during 1975 with the World Bank Financial assistance under the guidance of Karnataka Dairy Development Corporation. During 1975 an integrated project was launched in Karnataka to restructure and recognize the dairy industry on the co-operative principles and to lay foundation for new direction in dairy development. Work on the first ever the World Bank aided dairy development project was initiated in 1975. Initially it covered 8 districts of Karnataka such as Mysore, Hassan, Tumkur, Dharwada, Belgaum, Shivamoga, Chikkmagalore, and Kodagu. Hassan Co-operative milk producer’s society union ltd. was set up to implement the project by Karnataka dairy development co-operation (KDDC) in 1975. It was registered on 30th March 1977and the operational jurisdiction of the union extended to 3 districts namely Hassan, Chikkamagalore and Kodagu. ISO 9001:2000 certifications have been obtained for Quality, And HAMUL are in the process of obtaining HACCP quality certification at on early date. 2.2.2 Nature of Business Carried  Hassan milk union carried on the business of producing and marketing milk and milk Products, such as Peda, curd, Ghee, Buttermilk. Hassan milk union procuring surplus milk in the rural area and provide input activities to dairy co-operative societies like artificial insemination, supply cattle feed, animal health care programs for the upliftment of the producers. It purchased some products from KMF viz Nandini milk-toned bottle, Badam powder, Jamoon mix, Nandini bite, Skimmed milk powder (SKM), Mysore pak etc. All purchased and produced products were sold by its own. 2.2.3 Vision and Mission VISION H.R. Institute of Higher Education, Hassan. Page 12
  13. 13. Promotional Activities The Union thrives hard to adopt the modern & eco friendly technologies to produce milk & milk products of international standards to make our presence prominent in the global market.  KARNATAKA MILK FEDERATION CO-OPERATIVE SOCIETY wants to develop their milk union like AMUL CO-OPERATIVE SOCIETY. MISSION Hassan Milk Union aims to render the best service at nominal cost to its members to increase milk production and produce good quality milk by paying remuneration price throughout the year, thereby improving their economic and social condition while ensuring high quality milk & milk products to the delighted level of the consumers at competitive price.  To increase their sales from 60000-80000 liters per day by next five years  To increase quality of milk and fulfill the needs of the customers. 2.2.4 Goals & Objectives:  The milk union was started on 4th June 1975; they want to develop their milk union like AMUL CO-OPERATIVE SOCIETY.  To increase quality of milk.  To increase their sales from 70,000-80,000 liters per day by next 5 years.  Increase the milk dealers parlours from 23-40.  Increase the sales by conducting many programs like consumer information programs, consumer dairy visiting programs, hotel owner information program etc., To increase the members of the union to 49, regularly supply the toned, double toned NANDINI milk to all the cities according to customer needs. H.R. Institute of Higher Education, Hassan. Page 13
  14. 14. Promotional Activities 2.2.5 Ownership Pattern  Elected Body: The Co-operative society members are eligible for electing the President and other governing members. The President heads the elected body. The elected body controls the societies and they keep a close watch on the working of the Co-operative societies and HAMUL.  Selected & Administration Department The employees working in the organization under HAMUL constitute the selected body.The qualified candidates are selected to the organization. This involves both Elected and Selected bodies. The administration department decides all the technical, production, procurement etc. it also involves the pricing and accounting section. They are allotted with specific work on their qualification likewise, Technical Officers, Marketing officers, managing directors etc. There are around 415 employees working in all the sectors of organization. • The head of the selected body is the Managing Director; at present Ranganath • Elected body is in the administration till its fixed tenure whereas the selected body is till the retirement age fixed by the Govt. H.R. Institute of Higher Education, Hassan. Page 14
  15. 15. Promotional Activities 2.4 Product Profile The main product of HAMUL is milk that is processed in number of different categories based on their fat division is H.R. Institute of Higher Education, Hassan. Page 15
  16. 16. Promotional Activities Sl.No. Products Qty. of Fat & SNF Quantity Price in Rs 1. Toned Milk 3.5% & 8.5% 500Ml- 1ltr 9.30/500Ml 2 Standardized Homogenized Milk 4.5% & 8.5% 500Ml- 1ltr 11.30/500Ml 2.4.1 Nandini Toned Milk: It is a pure milk and most selling milk in Karnataka. It contain 3.0% Fat And 8.5%SNF. It is available in 500 ml and 1000 ml packs. Karnataka's most favorite milk. Nandini Toned Fresh and Pure milk containing 3.0% fat and 8.5% SNF. Available in 500ml and 1ltr packs. Available in 500ml and 1ltr packs H.R. Institute of Higher Education, Hassan. Page 16
  17. 17. Promotional Activities 2.3.2 Nandini Homogenized Standard Milk (Shubham): This pure milk contains 4.5% fat and 8.5% SNF. It is available in 500 ml and 1000 ml packs. This milk is rich creamier and tastier. It is ideal for preparing home mode sweets and savories. Nandini Homogenized Standard Milk Containing 4.5% Fat and 8.5% SNF.(Solid Not Fat) A rich, creamier and tastier milk, Ideal for preparing home-made sweets & savories. Available in 500ml. and 1 ltr packs. 2.3.3 Curd: It is thick and delicious. It is available in 200 grams, 500 grams and 1000 grams sachet etc.The price list of Curd: At the end of April, 30,2010 Sl No Particular Packing Quantity Price in Rs 1 Nandini Curd Sachet 200 grams 6 -00 2 Nandini Curd Sachet 500 grams 12 -00 H.R. Institute of Higher Education, Hassan. Page 17
  18. 18. Promotional Activities Nandini Curd made from pure milk. It's thick and delicious. Giving you all the goodness of homemade curds. ‘Available in 200gms and 500gms sachet. 2.3.4 Butter Milk: Butter Milk is a refreshing health drink. It is made from quality curds and is blended with fresh green chilies, green coriander leaves, asafetida and fresh ginger. Buttermilk is packaged in 250ml packet. Nandini spiced Butter Milk is a refreshing health drink. It is made from quality curds and is blended with fresh green chilies, green coriander leaves, asafetida and fresh ginger. Nandini spiced butter promotes health and easy digestion. It is available in 200 ml packs and is priced at most competitive rates, so that it is affordable to all sections of people. 2.3.5 Nandini Ghee: H.R. Institute of Higher Education, Hassan. Page 18
  19. 19. Promotional Activities Ghee is made from butter. It is fresh and pure with a delicious flavor. Hygienically manufactured and packed in the goodness of pure ghee. It has a got a shelf life of 6 months at ambient temperatures. It is available in 200 ml, 500 ml, 1000 ml sachet, 5 liter tins and 15 kg tins Particular Packing Quantity Price in Rs Sl No 1 Nandini Ghee Sachet 200 ml 0062 - 00 2 Nandini Ghee Sachet 500 ml 0152 - 50 3 Nandini Ghee Sachet 1000 ml 0300 - 00 4 Nandini Ghee Bulk Tin 15 kgs 4695 - 00 2.3.6 Peda: H.R. Institute of Higher Education, Hassan. Page 19
  20. 20. Promotional Activities Peda is very delicious made from pure milk. It can be stored for 7 days and available in 250 grams containing 10 pieces each Price list of Peda: At the end of April 30, 2010 Particular Packing Quantity Price in Rs Sl No 1 Nandini Peda 10 grams Box 100 grams 26 -00 2 Nandini Peda 25 grams Box 250 grams 60 -00 3 Nandini Peda (single) Single 25 grams 06 -00 No matter what you are celebrating! Made from pure milk, Nandini Peda is a delicious treat for the family. Store at room temperature approximately 7days. Available in 250gms pack containing 10 pieces each. 2.4 Achievements H.R. Institute of Higher Education, Hassan. Page 20
  21. 21. Promotional Activities Achievements and Awards HCMPSUL has got to 4 awards Energy Conservation Award Received on 14th Dec 2004 from Dr. Manamohan Singh, Prime Minister of India. Energy Conservation Award Received on 14th Dec 2005 from Dr. A.P.J. Abdul Kalam, President of India. Energy Conservation Award Received second prize in the year 2006 Energy Conservation Award Received third prize in the year 2007 2.6 SWOT Analysis of HAMUL H.R. Institute of Higher Education, Hassan. Page 21
  22. 22. Promotional Activities  STRENGTHS • Huge Demand There is a huge demand for Nandini milk and milk products in the market. Milk is very much needed for the children and the people to get good calories, vitamin and nutritional. There is increased population in India, hence there is increased demand for milk products. • Availability of Milk Union can easily get required milk with less cost from the rural area according to the need. Most of the farmers in Hassan district are having at least 2 or 3 cows or buffaloes in their home. Hence there is a good availability of milk for HCMPSUL. • Brand Nandini Nandini milk, Nandini ghee, Nandini curd etc Nandini products are well branded in the market because of their quality. • Man Power There is well experienced, professionally trained technical employees are working in the company with minimum experience of 15 years. It helps organization to maintain the quality of the product. • Location Hassan milk union is located in industrial estate beside NH-48 where people can easily found the company. It reduces the cost of transportation and leads to publicity of company name.  Good quality control  On time delivery  Skilled employees  Standardized products  Easy access to loans from National Dairy Development Board  Adaptability to changing technology H.R. Institute of Higher Education, Hassan. Page 22
  23. 23. Promotional Activities  WEAKNESS • Inadequate Transportation Bad condition of roads and inadequate transportation facilities makes milk procurement problematic. • No Cattle Form HCMPSUL has no cattle form in its own, it becomes one of the major weakness of the company. It focused more only on rural segment and very less concentration on urban area. New employee has less social security eg: accommodation is not provided to new employees where in it restricts their stay for a long period. • Limited advertisements No credit business  OPPORTUNITIES • Export There is demand for Nandini Products in other states viz Kerala, Goa. So it can export its product to those states along with Thamilnadu and Andrapradesh. • New Product Innovation It can innovate new products like Khoa, Ice cream, Pannier and dairy Sweets in the same product line. • Employment It provides more employment opportunity to the people. Currently there are 500 employees are working in the organization. Young, enthusiastic employees put their best efforts, which results in the growth of organization. The brand , image of the firm helps it to enter new areas quickly. H.R. Institute of Higher Education, Hassan. Page 23
  24. 24. Promotional Activities  THREATS • Market uncertainty There is a price fluctuation in the market, it may leads to decrease the demand and there by reduction in profit. • Competition Competitors are coming up with similar product, this is the main threat posed by the external environment.  Many private firms have entered into  Manufacturing of dairy products, there  Is a tough competition for Nandini  Like AROKYA, JERSY, JENUKAL and many more. H.R. Institute of Higher Education, Hassan. Page 24
  25. 25. Promotional Activities 2.7 Functional Areas  Procurement Department The procurement and input department is concerned with collection of milk from various DCS. • To follow up daily procure schedule as per the plan. • To collect quality of milk by checking fat content. • To maintain good relationship with DCS. • To send procured milk to production unit.  Milk Procurement Procedure The production department is responsible for procurement of raw milk. It consists of two wings called purchase and stores. Purchase wing is processing of raw milk and stores wing is receiving and issuing the same to the user department. Indent is raised by the user department and is registered at stores after verifying the availability of stock at stores. After registration, the indent is forwarded to purchase wing for procurement. At the time of registration of indent if stock is available, it is issued to the user department and the indent is cancelled. On receipt of indent the purchase wing lends enquires to various suppliers who normally supply the milk and milk products. Then these suppliers submit their offers. After receiving the offers, a comparative statement is made and forwarded to the general manager for recommendations. The General Manager chooses a most suitable offer for placement of purchase order. On receipt of purchase order, the supplier lends the milk and milk products along with the bills. The products are received at receipt section of the stores and are verified against the specification laid in purchase order. Then products/goods inspection note is prepared and forwarded to the GM department for inspection of the milk & milk products supplied. Then the GM inspects the material with quality experts at stores and accepts the same on reject depends upon the quality of products. H.R. Institute of Higher Education, Hassan. Page 25
  26. 26. Promotional Activities If the material is accepted, produce/goods receipt note is prepared and forwarded to account section and the material is stored in specified location. If the product/goods rejected then product/goods receipt note as well as reject note prepared and forwarded to accounts section for making payment to give information to the supplier about the rejection whenever GRN is prepared the stock of the particular items gets update in computer. The rejected producers/goods are returned to the suppliers. Whenever the union required milk and milk products or any materials they approach stores along with issue voucher against which product/goods issued and consumed. Periodic stock verification is conducted at stores to check the inventory. MILK CANS RURAL SOCIETIES COLLECTING MILK H.R. Institute of Higher Education, Hassan. Page 26
  27. 27. Promotional Activities 2.8 Product Production Process H.R. Institute of Higher Education, Hassan. Page 27
  28. 28. Promotional Activities Raw chilled Milk Raw Milk Returned Milk from CCS Raw Chilled Milk Pasteurization Pasteurized whole Milk Separation Skim Milk Toned Milk Homogenization Cream Standardized Homogenized Butter Milk Prestratification Packing Ghee Packing Cold Storage 2.9 Production Department Duties and Responsibilities of Production Manager H.R. Institute of Higher Education, Hassan. Page 28
  29. 29. Promotional Activities 1. He shall be overall in charge of production plant section. 2. To allot, monitor and supervise the work of the subordinates. 3. To make correspondence and maintain all files/documents of products. 4. To recommend the leave of his subordinates and make alternate arrangements during their absence on leave period. 5. He shall ensure and implement cost service measures to production section. 6. To plan and implement the disposal of excess milk in bulk sales and if shortage, arrangement to get milk from inter dairy as per requirements. 7. He shall plan well in advance requirements of chemicals/detergents on any other material of the production section. 8. He shall take care of entire plant and machinery. Processing Of Milk: Procuring & Can Washer Machine H.R. Institute of Higher Education, Hassan. Page 29
  30. 30. Promotional Activities The cans from the trucks are introduced to procuring & can washer machine, during this process the machine automatically opens the lid of the milk can and milk is collected in a chilling tank. Then the raw milk is pre chilled at 6-8% to arrest the growth of microorganisms. The milk cans are automatically washed and placed outside. Again the trucks are weighed to get the exact value of the raw milk obtained. Pasteurizing Unit The chilled & tested milk is been further sent for processing. Generally, milk is boiled & cooled in the houses to preserve it from spoiling, this method is known as Pasteurization. The same is introduced in HAMUL, there are two pasteuriser, which work for 24 hours and 365 days. The raw milk brought in, is heated up to 72.5 degree Celsius, for 15 minutes and immediately it is cooled to 4 degree Celsius. This method will kill the pathogenic to microorganisms, which would spoil the milk but retains the Lacto Bacillus (bacteria which converts milk to curds) and the pasteurised milk is further sterilized by boiling up to 140 degree Celsius other essentials like proteins, fats, vitamins, carbohydrates etc are remained. That makes it a complete food. In pasteurization, the raw milk is brought in through pipes, milk is heated through steam and it is cooled using ammonia as a cooling agent. The fat in the pasteurized milk is 4.1%; it is separated in a machine called Cream Separator. The division of fat is done for the preparation of varieties of milk based on fat content. H.R. Institute of Higher Education, Hassan. Page 30
  31. 31. Promotional Activities Packaging & Storing: Packaging Machine The processed milk and the byproducts manufactured are hygienically packed. Milk of different varieties and quantities based on the fat content is pre set in the auto-packaging machine. The pouch used for packaging is manufactured by KMF at Pouch Film Plant at Munnekolalu, Marathhalli in Bangalore. The pouches used are poly based and are re-cycle able. It prevents milk from spoiling. The packaged milk is bacteria free and is ready to use. The packed milk and its by-products are stored in 8 degree Celsius in refrigerating room using ammonia compressor. The unpacked extra milk is condensed to SNF (Solid Not Fat) that is SKIMMED MILK. The balance milk is sent to Dairies in Bangalore, Mangalore and Thrivendrum. H.R. Institute of Higher Education, Hassan. Page 31
  32. 32. Promotional Activities 2.10 Area of Operation Companies are always looking to carry business, where the required resources are easily available. Area of operation plays a vital role while fixing price, there by development of the company. Because if the area has suitable environment, raw materials, skilled labors for less wages, then it will reduces the cost of production. Hassan milk union carries out business at regional level that includes 3 districts viz Hassan, Chikmagalore, and Coorg. Hassan districts cover eight taluks namely Channarayapatna, Hassan, Arasikere, Sakaleshpur, Belur, Alur, Arakalagudu, and Holenarasipur. It collects the milk from various villages of these eight taluks. Chikmagalore district covers Chikmagalore, Kuduremuka and Tarekere. Kodagu districts cover Somavarpete, Virajpete and Madikeri. In Kudige dairy totally 5000 LPD is renovated at the cost of 251 lakhs with assistant of national dairy development board. Totally Hassan milk union covers 2583 villages, 3 districts, 65 milk procurement routes with average procurement 2, 68,417 kgs/day at present. The total local sales are 90,000LPD, and about 2, 50,000 LPD to other states. H.R. Institute of Higher Education, Hassan. Page 32
  33. 33. Promotional Activities 2.11 Activities of Hassan Milk Union:  Organization of Dairy Co-Operative Societies As at the end of June 2009, 1085 societies have been registered of which 1009 are functional. Out of functional societies 268 are women societies, 124 step women societies are functioning which results in enhancing the socioeconomic development of women.  Membership Enrolment As on 30th June 2009 1, 61,385 members have been enrolled of which 67,102 are small farmer, 44,264 are marginal farmers, 20,384 are agriculture labourers, and 28,294 are other big farmers. Out of the total 10,587 belongs to SC members, 3,984 belongs to ST members. 48,302 members belong to women members.  Milk Procurement Activities The present average milk procurement from 1009 milk societies is around 4,39,921 kgs/day. During the month of June the average procurement /DCS/day is 435 kgs and the average transportation cost per kg of milk procurement is 30 paisa. The average fat is 4.06% and average SNF is8.50%. 2.11.1 Input Activities:  Veterinary Facility Covered 638 societies under veterinary route, 6 mobile veterinary routes treating an average of 4,500 cases per month. There are 5 emergency routes in operation and treating around 400 to 450 cases per months. There are 340 first aid centres are also working. Union is providing SAF kit to the animals for the prevention. (Or) de-warming. Foot and mouth vaccination is also providing for controlling foot and mouth diseases. H.R. Institute of Higher Education, Hassan. Page 33
  34. 34. Promotional Activities  Artificial Insemination To improve the breeding facility there are 16 single AI centres and 77 Cluster AI centres are working in the union area. These centres are covered around 90% of the DCS. Averages of 20,000 inseminations are carrying out every month. 3815 male cows and 4315 female total 8130 cross breed cows have been born during June 2009.  Feeds and Fodder The union is uncovering the farmers and the producers at the village level in growing modernized fodder. Ex. union is suppling CO1, CO2 and Napier roots and SSG seeds , cow pea seeds and seasonal seeds to the producers. The union is also arranging straw treatment demonstration, silage demos at village levels. The union is supplying around 3200 metric tones of cattle feeds and an average 6000 kgs of mineral mixtures to the society members. Nearly 98% of the functional societies have been covered under cattle feed sales.  Training facilities Training will be given to the milk society secretaries, testers and management committee members. DAM (dairy animal management) is given to the producers. This training is given in central training institutes, Mysore, owned and managed by KMF Bangalore. 2.11.2 Other programmes:  Group insurance:- With the co-ordination of the general insurance company by paying premium to the insurance company. The DCS providing insurance coverage.  Step programme:- H.R. Institute of Higher Education, Hassan. Page 34
  35. 35. Promotional Activities Under this, women members have been enlightened with education, nutrition, legal matters. SHG (self help group) the main purpose of step programme is to provide better socio-economic status to the women members  Yashaswini health programme:- Under this scheme, those who have become members of this scheme well get medical benefits like operation charges.  Total Quality Management (TQM);- The union has encouraged clean milk production programme at village level. The union has obtained ISO 9001:2000 certifications. There are 13 bulk milk coolers and 43 automatic milk collection centres which are functioning in the milk societies. Union activities have been computerized partially and during 2008-2009, it is spending around 64-70 lakhs towards computerization. H.R. Institute of Higher Education, Hassan. Page 35
  36. 36. Promotional Activities 2.12 Marketing Department  Duties and Responsibilities of Marketing Officers 1. To fix necessary targets to the retailers, wholesalers, depots, day counter and milk parlours. 2. To take necessary actions to appoint retailers/DS/MP in the new extension. 3. To adopt necessary extension programmes for consumer awareness. 4. To arrange for consumers meet/fairs/exhibitions and to take participation in such programmes to improve nandini milk sales. 5. To collect information about private competitors milk sales and to take necessary action to curtail the private dairy milk sales. 6. To arrange for the retailers meeting at least once in 6 months and to discuss about the problem. 7. To inspect the milk parlours regularly and to keep watch on sale of other products. 8. If the parlors contractors are found to sell products other than Nandini products, action should be taken. 9. To keep close watch on the milk distribution vehicles movement of routes and to check that the milk and milk products reach the retailers with in the described time. 10. To conduct distance survey of milk distribution route and to certify them regularly. 11. To take necessary action to make recoveries if any due from the retailers. H.R. Institute of Higher Education, Hassan. Page 36
  37. 37. Promotional Activities To collect the information pertaining to the choultaries, hostels, public institutions, sweet stalls, Bakeries, Ice cream parlours, hotels, and conduct necessary extension programme to increase the sales. Marketing department plays a vital role in determining the future abilities of the company. Its main objective is to distribute goods from producers to the customers. It distributes milk to consumers and also provides consumer education through ad campaigns and participating in various exhibitions. • To plan marketing programmes. • To analyze marketing opportunities. • To develop marketing strategies. • To connect the consumer with the products. 2.13 Major Competitors Profile Market Share Nandini Loose milk Milky wave Arokya  Competitors Information There are many competitors viz., Milky Wave, Arokya, Jersy, Jenukal, Kaveri, JT Milk, etc are producing similar product in same area with similar strategy. H.R. Institute of Higher Education, Hassan. Page 37
  38. 38. Promotional Activities 2.14 Future Growth and Prospects • Envisaged to establish total of 900 DCS by the end of 2010. • Planned to establish artificial Insemination centers. [AI] Single AI centers 40 Cluster AI centers 80 For this they are expected expenses of Rs 16800 for single AI centers, and Rs 201600 for cluster centers • The expected maize seed productions are 90 metric ton. • Cowpea production 1.5 metric tons, 2500000 of route slips. • The procurement is expected to increase to 34450 kegs’. Per day. • The local sales are expected to 108610 LPD and bulk sales are 41410 LPD. • Cattle food sales will also be increased to 96 metric ton. • In addition to strengthening of market, network quality assurance programme and milk enhancement activities will be underta 2.15 ANNUAL MARKET PLAN FOR DEVELOPMENT ACTIVITIES FOR THE YEAR 2009-10 Hassan milk union Ltd establish in the year 1977 has been catering efficiently to the needs of the urban and semi urban consumers by supplying pasteurized and assured H.R. Institute of Higher Education, Hassan. Page 38
  39. 39. Promotional Activities quality “Nandini” milk and milk products in the jurisdiction covering Hassan, chikmangalure and Kodagu districts. Over the years, the union has been taking many steps to meet the changing needs of consumers, the availability of milk variants and new milk products have been produced for customer requirement. Priority areas for the development of liquid milk market in the union area are identified and necessary action plans have been drawn for implementation during the year 2009-10.The key strategies planned for 2009-10 are as follows  INCREASING THE AVAILIBILITY OF NANDINI MILK THROUGH OUT THE DAY IN THE MARKET:  ENHANSING EFFECTIVENESS OF CONSUMER AWARENESS PROGRAMME.  TEAM CONCEPT FOR MARKET DEVELOPMENT.  CREATION OF GRIVANCE REDRESSAL CELL.  CONSTITUTING EFFECTIVE REPLACEMENT/LEAKAGE POLICY.  CONSTITUTING A CORE GROUP FOR SOLVING DAY TO DAY PROBLEMS.  PROMOTING CHANNEL MEMBERS.  ELICITING CONSUMER FEED BACK FOR QUALITY ASSURANCE.  SALES PROMOTION ACTIVITIES.  INCREASING THE AVAILABILITY OF NANDINI MILK THROUGH OUT THE DAY IN THE MARKET a) By expanding the retail market in the union Area. H.R. Institute of Higher Education, Hassan. Page 39
  40. 40. Promotional Activities • Introduction of an adhoc milk distribution route to Hassan city from morning 6.00 A.M to 4.00 P.M. at regular intervals to cater to the retailer needs after normal vending hours. • Supply of loose milk in 40Lts cans to hotels, choulteries, and institution at concessional rates. • Identifying the uncovered areas of distribution and appointing new retailers in such areas to expand the local market. • Introduction of Adhoc day route exclusily for Milk products distribution in the union area. b) Strengthening the existing milk parlour, depots and day co There are totally 548 retailers, 18 milk parlours, 14-day counters and 16 depots operating in the union area. It is decided it strengthen providing Bottle coolers to retailers at the rate of 50% cost and free supply of insulated boxes and introduction of insulated Transport vehicles to door step of retailers and extended hours of milk supply c) Introduction of Full cream m Milk (500Ml)Sachet in the Market during first quarter in 2009-10.  ENHANCING EFFECTIVENESS OF CONSUMER AWARENESS PROGRAMMES: To persuade consumers, who are purchasing loose milk, or Competitors milk to purchase “Nandini” milk. This objective is most suitable for our union since their market share is less To create awareness among existing and prospective consumers about: a) The organization. b) Quality products and Services available. H.R. Institute of Higher Education, Hassan. Page 40
  41. 41. Promotional Activities c) Dairy plant activities-hygienic milk handling practices of nandini vis a vis loose milk d) Health hazards of consuming adulterated milk. e) Quality and hygienic aspects of sachet milk and milk products . f) Dairy visit by school children, consumers and mahila mandal’s g) Education programmes on “Milk and Health” at schools and public places.  TEAM CONCEPT FOR MARKET DEVELOPMENT: In ordered to achieve highest sales target, it has been decided to constitute functional teams. This team will conduct the following activities. a) Visit the market along with marketing staff for market development and to increase sales. b) Organize door to door campaign c) Arrange quality testing at selling point/Public. d) Organize dairy visit to school children, housewife’s, mahila mandals & consumers.  CREATION OF GRIEVANCE REDRESSAL CELL: This system to be implemented with the help of following activities. a. A decided Toll free telephone to the marketing section of Hassan and Kudige Dairy would be provided for benefiting channel members. b. Further, the telephone numbers and contact person’s name to be published in leading local daily News papers and circulated to all the agents’ day counters. c. The complaints to be addressed immediately and would be rectified within 24 hours.  EFFECTIVE REPLACEMENT / LEAKAGE POLICY: The fallowing measures are planned to overcome the leakage problem. - Film quality testing programmes - Focus on discussions - Segregating leaky pouches at dairy dock before dispatch H.R. Institute of Higher Education, Hassan. Page 41
  42. 42. Promotional Activities - Proper Monitoring of Packing Machines - Storing in required temperature before dispatch - Taking proper care during transport to avoid damage.  CONSTITUTING A CORE GROUP FOR SOLVING DAY TO DAY PROBLEMS: A core team constituting of officers from plant, quality control, marketing and accounts have been formed to implement the strategies of SMP for implementation. This team would sit every day for 15 minutes with Manager (dairy) and thrash out problems faced by the marketing staff. Problems noticed and action initiates are to be recorded every day. And appraise the M.D in week and conduct review meeting once in a month  MOTIVATING THE CHANNEL MEMBERS: A system to motivating and educate the channel members has been proposed for increasing the milk sales. A systematic awareness campaign would be organized and all the Nandini retailers will be contacted. This is planned by meeting them regularly and inviting suggestion from them on a regular basis. Retailers meeting will be conducted once in 6 months. Higher milk sale retailers in a particular districts route will be rewarded.  ELICITING CONSUMERS FEEDBACK FOR QUALITY ASSURANCE: By preparing a set of questionnaire and eliciting the fees back from the customers, will get us information about customers’ perception on Nandini milk and milk products, Quality, Packaging, and pricing etc. By conducting this will get the results from the customers, in case if these are any problems we can rectify it. We can do this by putting few questions to the customers asking about the quality, price shelf life packing, satisfaction etc. By this we can also create awareness about the brand. And get the feedback about competitor brands also in the market.  SALES PROMOTION ACTIVITIES: Sales promotion is a marketing activity that provide extra value or incentive to sales force , distributors, and the ultimate consumers can stimulate immediate sales . a) Group Insurance Scheme Extended to Retailers: H.R. Institute of Higher Education, Hassan. Page 42
  43. 43. Promotional Activities The proposal of providing Group Insurance facility to retailers which is in existence during 2004-05 for a period of 3 years is continued during the present year. b) Loose Milk Sales to Hotels /Choulteries / retailers: It is proposed to introduce loose milk sales (toned milk and curds) Rs15/- and Rs 19/-/lLtr. Through aluminium milk cans of 40 liter. And 20 ltr. Capacity only to hoteliers and other directly c) Brand Advertisement, Vehicle and Wall painting, Radio programmes and Awareness programmes will be continued during 2008-09 also . d) Supplying posters , flex boards glow sign boards, tarpaulin bags organizing retailers tour programme etc. Review of Literature H.R. Institute of Higher Education, Hassan. Page 43
  44. 44. Promotional Activities Promotion:- The word promotion, originates from the Latin word “promovere”, the meaning is “to move forward” or to advance an idea. The aim of production is sales. Sales and promotion are two different words and sales promotion is the combination of these two words. Sales promotion methods aim to capture the market and increase the sales volume. Sales promotion consists of a diverse of innovative tools, mostly short term, designed to stimulate quicker or greater purchase or particular products/services by the consumers are the trade. Today sales promotion has been accounted for 60% to 70% of the combined budget. Sales promotion expenditure has been increasing 12 annually compared with advertising in of 7.6%. Sales promotion tools vary in their specific objectives. A free sample stimulates consumer trail and while a free management advertising service cements a long-term relationship with a retailer. Sales promotion often attracts brand switchers, because users of other brands and categories do not always notice or act on a promotion. Brand switchers are primarily looking for low price, good values or premiums. Sales promotions are unlikely to turn them into loyal brand users. In markets of high brand dissimilarity, sellers use incentive type promotions to attract new customers, to reward loyal customers and to increase the repurchase rates of occasional users. Sales promotion yields faster responses in sales than advertising. 3.1 Sales promotion has dual objectives :- To increase buying response by ultimate consumers To increase selling efforts and intensity by dealers as well as by sales a personnel To capture the major share of the market To meet the competition of other firms To inform the public about the new product and its specialties, attraction and advantages To create favourable attitude towards the product To create additional talking points to sales persons To establish and maintain communication with large market segments Sales promotion includes those sales activities that supplement both personal selling and advertising to co-ordinate them and help them make effective such as displays H.R. Institute of Higher Education, Hassan. Page 44
  45. 45. Promotional Activities shows and expositions, demonstrations and non-recurrent selling efforts not in ordinary routine. 3.2 Marketers take sales promotion activities for the following reasons:- For introducing new product For overcoming unique competitive situation For unloading accumulated inventory For getting new accounts For persuading dealer to buy more/increase size of orders For retrieving cost accounts 3.3 Role of Promotion To communicate with individuals, groups or organizations to directly or indirectly facilitate exchanges by informing and persuading one or more audiences to accept an organization's products. Promotion and Society Marketers need to communicate, therefore need a medium to facilitate communication. • TV • Newspapers • Radio • Magazines Promotion Involves disseminating information about a product, product line, brand, or company. It is one of the four key aspects of the marketing mix. (The other three elements are product marketing, pricing, place.) Promotion is generally sub-divided into two parts: • Above the line promotion: Promotion in the media (e.g. TV, radio, newspapers, Internet, Mobile Phones, and, historically, illustrated songs) in which the advertiser pays an advertising agency to place the ad H.R. Institute of Higher Education, Hassan. Page 45
  46. 46. Promotional Activities • Below the line promotion: All other promotion. Much of this is intended to be subtle enough for the consumer to be unaware that promotion is taking place. E.g. sponsorship, product placement, endorsements, sales promotion, merchandising, direct mail, personal selling, public relations, trade shows The specification of these four variables creates a promotional mix or promotional plan. A promotional mix specifies how much attention to pay to each of the four subcategories, and how much money to budget for each. A promotional plan can have a wide range of objectives, including: sales increases, new product acceptance, creation of brand equity, positioning, competitive retaliations, or creation of a corporate image. The term "promotion" is usually an "in" expression used internally by the marketing company, but not normally to the public or the market - phrases like "special offer" are more common. Getting the marketing mix right for your product or service means you are covering all of the important bases in your marketing campaign. Here is a definition of marketing mix and a description of its main components. The term marketing mix refers to the primary elements that must be attended to in order to properly market a product or service. Also known as The 4 Ps of Marketing, the marketing mix is a very useful, if a bit general, guideline for understanding the fundamentals of what makes a good marketing campaign. Here is a brief description of each component of the 4 Ps of the marketing mix. Product: The marketing mix concept has its roots in the 1950s U.S. corporate marketing world, and the practice of marketing has obviously evolved tremendously since this term was invented. One of the changes is that there are a lot more services available nowadays, such as those available online. Also, the distinction between product and service has become more blurry (e.g., is a Web-based software application a product or a service?). Either way, product here refers to products or services. The product or service you offer needs to be able to meet a specific, existing market demand. Or, you need to be able to create a market niche through building a strong brand. H.R. Institute of Higher Education, Hassan. Page 46
  47. 47. Promotional Activities Price: The price you set for your product or service plays a large role in its marketability. Pricing for products or services that are more commonly available in the market is more elastic, meaning that unit sales will go up or down more responsively in response to price changes. By contrast, those products that have a generally more limited availability in the market (but with strong demand) are more inelastic, meaning that price changes will not affect unit sales very much. The price elasticity of your product or service can be determined through various market testing techniques. Place: This term really refers to any way that the customer can obtain a product or receive a service. Provision of a product or service can occur via any number of distribution channels, such as in a retail store, through the mail, via downloadable files, on a cruise ship, in a hair salon, etc. The ease and options through which you can make your product or service available to your customers will have an effect on your sales volume. Promotion: Promotion is concerned with any vehicle you employ for getting people to know more about your product or service. Advertising, public relations, point-of- sale displays, and word-of-mouth promotion are all traditional ways for promoting a product. Promotion can be seen as a way of closing the information gap between would-be sellers and would-be buyers. Your choice of a promotional strategy will be dependent upon your budget, the type of product or service you are selling, and availability of said promotional vehicle. Marketing has come a long way from the 4 Ps of yesteryear, and yet understanding this marketing mix is for your product or service remains very relevant today. The marketing mix serves as an excellent touchstone for continually checking that you are covering all of the bases in your marketing campaign. H.R. Institute of Higher Education, Hassan. Page 47
  48. 48. Promotional Activities 3.4 Nine elements to the communication process Sender C and Receiver Target Market are the major parties in the communication process. Message New Car, Cirrus, comfort of a Lexus and handling of a BMW for less money and the media TV, direct mail, Brooks Brothers etc are the major communication tools. Last element is Noise in the system, more noise with non-personal communication Sender needs to know: • What audiences they want to reach • What responses they want. • How the target audience decodes messages • What media will effectively reach the target audience Scope and importance of sales promotion: o 323 billion coupons were distributed 1993 nationally annually (3,200/household), only 2.3% are redeemed. o 9000 trade shows containing 10 exhibits or more/year. New York auto show attracts more than a million people per year. o $15-20 billion/year spent on point of purchase material in stores. Why? o companies are looking to get a competitive edge o quick returns are possible for short term profits o more consumers are looking for promotions before purchase o channel members putting pressure on mf. for promotions o advances in tech. make SP easier (ie coupon redemption) H.R. Institute of Higher Education, Hassan. Page 48
  49. 49. Promotional Activities 3.5 Sales Promotion Opportunities and Limitations o Increase in sales by providing extra incentive to purchase. May focus on resellers (push), consumers (pull) or both. o Objectives must be consistent with promotional objectives and overall company objectives. o Balance between short term sales increase and long term need for desired reputation and brand image. o Attract customer traffic and maintain brand/company loyalty. o Reminder functions-calendars, T Shirts, match books etc. o Impulse purchases increased by displays o Contests generate excitement esp. with high payoffs. Limitations o Consumers may just wait for the incentives o May diminish image of the firm, represent decline in the product quality. o Reduces profit margins, customers may stock up during the promotion. o Shift focus away from the product itself to secondary factors, therefore no product differential advantage. 3.6 Major consumer promotional tools:- Coupons: coupons are supplied along with a product. It is a certificate that reduces prices. Coupons can be mailed, enclosed in the packets or printed in the advertisements. Samples: Free samples are given to consumers to increase the product. These are given to the people in the hope that they will buy the goods when they are satisfied with the sample. Money refund offers: If he purchaser is not satisfied with the product, a part or all of the entire purchaser’s money will be refused. Premium Offer: It is a temporary price reduction, which increases the instinct of the buyers. Products are offered free or at a reduced cost as an inducement for purchasing. H.R. Institute of Higher Education, Hassan. Page 49
  50. 50. Promotional Activities Contests: The customers are asked to state in a few words why they prefer a particular product. To enter, the consumer must purchase a product and submit the evidence with the entry forms to contests, for the winner attractive prizes are given in the form of cash or valuable articles. Demonstration: It is the instructions to educate the consumers in the manner of using products. It is arranges at the retail, store or in trade fairs. Price off Offers: It stimulates sales during slump reasons. It gives a temporary discount to the customers. 3.7 Dealer’s promotion tools:- Price off/off list: a price off is a straight discount of the list price on each case purchased during a stated time period. Allowance: An allowance is an amount offered in return for the retailers agreeing to feature the manufacturer’s product in some way. Free Goods: Free goods are offers of extra cases of merchandise to middlemen who buy a certain quality or who feature a certain flavour or size. Dealer’s contest: This is an indirect way of boosting the sales. This type of contest is conducted at the level of retailers and wholesalers. Price deals: Apart from the regular discount, special discount are also allowed to dealers for a special quantity of purchased. Co-operative advertising: Dealers spend money in advertising manufacturer’s product with the consent of manufacturers. 3.8 Sales force promotion tools:- Trade shows and convention: Industry associates organize annual trade shows and conventions Bonus to sales force: The manufacturers set a target of sales for a year. If the sales force sells the product above the targeted sales, bonus is offered to them. Sales contests: A sales contest is a contest involving the sales force or dealers, aimed at inducing them to increase their sales results over a stated period, with prizes going to those who succeed. H.R. Institute of Higher Education, Hassan. Page 50
  51. 51. Promotional Activities Specialty advertising: It consists of useful, low cost items given by sales people to prospectus and customers bearing the giver’s name and address and sometimes an advertising message. Salesmen meeting and conference: the idea behind this is to educate, inspire and reward salesmen. Encouragement is given to them during the discussion.  Brand: Brands are names generally assigned to a product or service or a group of complementary products while a corporate image covers every aspect of the company. Brands are drivers of competitive edge. “A successful brand is a name, symbol, design, or some combination, which identifies the ‘product’ of a particular organization as having a sustainable differential advantage”  Branding:- • It is the practice of giving a specified name to a product or group of products of one seller branding is the process of finding and fixing the means of identification naming a product like naming a baby, is known as branding. • Branding gives seller the opportunities to attract profitable set of customers. A brand loyalty gives seller some protection from the competitors and greater control in market program. Some importance of branding is as follows: • Branding helps the seller segment market each formulated differently and aimed at specific benefits seeking segment. • Good brand helps in building corporate image • Memory recalls is facilitated • Advertising can be directed more effectively and linked with other communication programs • Branding leads to a more ready acceptance of a product by wholesalers and retailers • The importance of price differentials may be diminished H.R. Institute of Higher Education, Hassan. Page 51
  52. 52. Promotional Activities • Brand loyalty may give a manufacture greater control over marketing strategy and channels of distribution • Branding makes market segmentation easier • Brand mark is that part of the brand, which appears in the form of a symbol, design or distinctive, coloring or lettering it is designed to easy identification of a product • Brand should suggest something about the product, purpose, quality and benefits etc. • It should be easy to advertise and identify • Should be of a permanent nature • It should be capable of being registered and protected legally • It should economical to reproduce • It should create a good image • It must have a pleasing sound to the ear when pronounced. 3.9 Forms of promotion: • Personnel selling • Advertising • Sales Promotion • Publicity • Propaganda and Public Relation Selling: “Selling is the personnel or interpersonal process of assisting and persuading a prospective customer to buy a commodity or service and to act favourably upon an idea that has commercial significance to the seller’ Labeling: Label is a part of the product which carries verbal information about the product or the seller. It may be part of package, or it may be a tag attached directly to the product. The act of attaching or tagging the label is known as labeling. Packaging: H.R. Institute of Higher Education, Hassan. Page 52
  53. 53. Promotional Activities Packaging of a consumer product is an important part of the marketing plan. Packing means wrapping of goods before they are transported or stored o4 delivered to a customer. Packaging an activity, which is concerned with protection economy convenience and promotional consideration? The wrapper of the container is celled package. 3.10 Advertising: Advertising as any paid form of non-personal presentation and promotion of ideas, goods or services by an identified sponsor. Advertisement is that activity by which visual oral messages are addressed to the general public the aim is to persuade people to buy more. It creates desire for new products the success of advertising greatly depends upon effective advertising programme. Its purpose is to inform or influence then in order to increase of the sales. According to Philip Kotler, “advertising is non-personal form of communication conducted through paid media under clear sponsorship.” 3.10.1 Advertising is mainly for the purpose of: 1. Promotion of new product 2. Support of personnel selling 3. To create brand patronage 4. For dealers support 5. Advertising appears effective in increasing the volume purchased by local buyers but less effective in winning new buyers. 3.10.2 Kinds of Advertising:- Product Advertising:- It aims at selling a particular product. A particular product with its brand is promoted through advertisement. Institutional Advertising:- It is displayed to create goodwill for the firm rather than to sell its product it gives importance to the firm and wants to create a good impression about a particular manufacturer. H.R. Institute of Higher Education, Hassan. Page 53
  54. 54. Promotional Activities Commercial Advertising:- May be trade advertising relation to trade industrial advertising, relation to industrial professional, relating profession form, relating to farm products Non-commercial Advertising:- Non-profit organizations adopt this type of advertisement. 3.10.3 Selection of Advertising Media:- • It is a means through which advertises communicate their idea to likely customer to influence them with a view to know and decide about the product or service advertised. It needs a prudent calculation; it eats away the funds, the absence of correct decision will waste the money without result. It must satisfy the following:- • It has to reach maximum prospects • It must gain the attention of readers • It must have wide coverage at least cost. 3.10.4 Advertising Media:- Medium is a means through which the advertising message is conveyed to the consumers. The proper selection of the medium, by which the message is to be conveyed, must achieve the pre-determined goals. A medium is the carrier of advertising message. It is the means to deliver the advertising message. Each advertiser has good many media for his selection. 3.11 Kinds of Media: Indoor advertising media:- When advertising is made through newspapers, magazine, radio, T.V program or cinema program in video etc., so that people can get the message at home, it is known as indoor advertisement. This media represents the use of those vehicles by the advertisers that carry the message right into the houses or indoors of the audiences. Here the massage reaches the audience indoors when it is easy and interceptive mood because house is the resting place for inmates for relax. H.R. Institute of Higher Education, Hassan. Page 54
  55. 55. Promotional Activities Outdoor advertising media:- Outdoor advertising passes the message to those people who are moving audience. Generally, almost all people go out on some purpose or other-office walk, sightseeing, journey, park visit etc. This advertising message is delivered to the audience like print and broadcast media. Rather the message is placed in strategic places exposed to moving audience. This outdoor advertising has the best effects of advertising. Direct mail advertising:- The object of direct advertising is to create a direct contact with the customers. The advertiser can keep a close touch with the customers or the public who are supposed to have interest in his products. It covers all forms of printed advertisements delivered directly to the prospective customers instead of indirect distribution like newspapers and magazines. The advertiser contacts customer and keeps a close touch with them through mail advertising. Display advertising Media:- The object of this media is to increase the sales. This is hinged on concepts of display. Display is the systematic arrangements of sample of saleable products to catch the imagination as well as to attract the attention and notice of the lookers. It demonstrates directly about the product by presenting them than by telling and selling the points directly. Brochures or flyers:- Many desk-top publishing and word-processing software packages can produce highly attractive tri-fold brochures. Brochures can contain a great deal of information if designed well, and are becoming a common method of advertising. Direct mail -- Mail sent directly from you to your customers can be highly customized to suit their nature and needs. You may want to build a mailing list of your current and desired customers. Collect addresses from customers by noticing addresses on their checks, asking them to fill out information cards, etc. Keep the list online and up-to-date. Mailing lists can quickly become out-of-date. Notice mailings that get returned to you. This should be used carefully and it can incur substantial H.R. Institute of Higher Education, Hassan. Page 55
  56. 56. Promotional Activities cost, you don't want to inundate your stakeholders with information so make the most of your message. E-mail messages -- These can be wonderful means to getting the word out about your business. Design your e-mail software to include a "signature line" at the end of each of your e-mail messages. Many e-mail software packages will automatically attach this signature line to your e-mail, if you prefer. Magazines -- Magazines ads can get quite expensive. Find out if there's a magazine that focuses on your particular industry. If there is one, then the magazine can be very Useful because it already focuses on your market and potential customers. Consider placing an ad or writing a short article for the magazine. Contact a reporter to introduce yourself. Reporters are often on the look out for new stories and sources from which to collect quotes. Newsletters -- This can be powerful means to conveying the nature of your organization and its services. Consider using a consultant for the initial design and layout. Today's desktop publishing tools can generate very interesting newsletters quite inexpensively. Newspapers (major) - Almost everyone reads the local, major newspaper(s). You can get your business in the newspaper by placing ads, writing a letter to the editor or working with a reporter to get a story written about your business. Advertising can get quite expensive. Newspaper are often quite useful in giving advice about what and how to advertise. Know when to advertise -- this depends on the buying habits of your customers. Newspapers (neighborhood) -- Ironically, these are often forgotten in lieu of major newspapers, yet the neighborhood newspapers are often closest to the interests of the organization's stakeholders. Online discussion groups and chat groups -- As with e-mail, you can gain frequent exposure to yourself and your business by participating in online discussion groups and chat groups. Note, however, that many groups have strong groundrules against blatant advertising. When you join a group, always check with the moderator to understand what is appropriate. Posters and bulletin boards -- Posters can be very powerful when placed where your customers will actually notice them. But think of how often you've actually noticed posters and bulletin boards yourself. Your best bet is to place the posters on bulletin H.R. Institute of Higher Education, Hassan. Page 56
  57. 57. Promotional Activities boards and other places which your customers frequent, and always refresh your posters with new and colorful posters that will appear new to passers by. Note that some businesses and municipalities have regulations about the number of size of posters that can be placed in their areas. Radio announcements -- A major advantage of radio ads is they are usually cheaper than television ads, and many people still listen to the radio, for example, when in their cars. Ads are usually sold on a package basis that considers the number of ads, the length of ads and when they are put on the air. . A major consideration with radio ads is to get them announced at the times that your potential customers are listening to the radio. Telemarketing -- The use of telemarketing is on the rise. Television ads -- Many people don't even consider television ads because of the impression that the ads are very expensive. They are more expensive than most of major forms of advertising. However, with the increasing number of television networks and stations, businesses might find good deals for placing commercials or other forms of advertisements. Television ads usually are priced with similar considerations to radio ads, that is, the number of ads, the length of ads and when they are put on the air. Web pages -- You probably would not have seen this means of advertising on a list of advertising methods if you had read a list even two years ago. Now, advertising and promotions on the World Wide Web are almost commonplace. Businesses are developing Web pages sometimes just to appear up-to-date. Using the Web for advertising requires certain equipment and expertise, including getting a computer, getting an Internet service provider, buying (usually renting) a Website name, designing and installing the Website graphics and other functions as needed (for example, an online store for e-commerce), promoting the Website (via various search engines, directories, etc.) and maintaining the Website. Yellow Pages --The Yellow Pages can be very effective advertising if your ads are well-placed in the directory's categories of services, and the name of your business is descriptive of your services and/or your ad stands out (for example, is bolded, in a large box on the page, etc.). The phone company will offer free advice about placing your ad in the Yellow Pages. They usually have special packages where you get a business phone line along with a certain number of ads. H.R. Institute of Higher Education, Hassan. Page 57
  58. 58. Promotional Activities Promotional Activities Through the Media (Reporters, Newspapers, etc.) Articles that you write -- Is there something in your industry or market about you have a strong impression? Consider writing an article for the local newspaper or a magazine. In your article, use the opportunity to describe what you're doing to address the issue through use of your business. Editorials and letters to the editor -- Often, program providers are experts at their service and understanding a particular need in the community; newspapers often take strong interest in information about these needs, so staff should regularly offer articles (of about 200 to 900 words) for publication. Press kits -- This kit is handy when working with the media or training employees about working with the media. The kit usually includes information about your business, pictures, information about your products, commentary from happy customers, etc. Press releases or news alerts -- They alert the press to a major event or accomplishment and requesting, e.g., it get included in the newspaper; they explain who, what, where, why and when; some include pictures, quotes, etc. to make it easier for the reporter to develop an announcement or story. Public service announcements (PSA)s -- Many radio and some television stations will provide public service announcements for nonprofit efforts. Usually, these PSAs are free.Other Promotional Activities and Events Annual reports - Disseminate these to key stakeholders; they're ripe with information if they include an overview of your year's activities, accomplishments, challenges and financial status. Collaboration or strategic restructuring - If you're organization is undertaking these activities, celebrate it publicly. Networking - Spread the word to peers, professional organizations and those with whom you interact outside the organizations, e.g., educators, consultants, suppliers, clients, etc. Novelties -- It seems more common to find ads placed on pens and pencils, coffee cups, T-shirts, etc. These can be powerful means of advertising if indeed current and potential customers see the novelties. This condition often implies additional costs to mail novelties, print T-shirts, etc. H.R. Institute of Higher Education, Hassan. Page 58
  59. 59. Promotional Activities Presentations -- You're probably an expert at something. Find ways to give even short presentations, for example, at local seminars, Chamber of Commerce meetings, trade shows, conventions, seminars, etc. It's amazing that one can send out 500 brochures and be lucky to get 5 people who respond. Yet, you can give a presentation to 30 people and 15 of them will be very interested in staying in touch with you. Relationships with key stakeholders -- Identify at least one representative from each major stakeholder group and take them to lunch once a year. What seem as short, informal exchanges can cultivate powerful relationships of interest and concern. Special events -- These tend to attract attention, and can include, e.g., an open house, granting a special award, announcing a major program or service or campaign, etc. Special offers -- We see these offers all the time. They include, for example, coupons, discounts, sweepstakes, sales, etc. Recent Movement in Marketing, Advertising and Public Relations -- Social Networking (Online) Social neworking involves a variety of online tools that can be used by people and organizations to quickly share a great deal of information at very little cost. Many people are now hearing of some of those tools, e.g., Facebook, Twitter, MySpace and Youtube. Experts are asserting that social networking is a must for people and organizations wanting to share information with othres -- after all, that's what marketing is all about! 3.12 Sales Promotion activities in Nandini:- In a consumer market to attract consumers and acquire market share, the company is adopting more sales promotion tools in their marketing strategies. These tools attract brand switchers who can be lured by offering premium and product at lower prices. Likewise, the company has adopted a few trade push methods for growth and judiciously applied is funds towards sales promotion as there were severe cash crunch. The trade push method proved beneficial because these methods give company a certain guarantee the customer off takes through the working capital required becomes relatively high when compared to other method of concentration on consumer pull by way of advertising campaign. The following are the sales promotion tools adopted by the Nandini: Hoardings Sponsorships H.R. Institute of Higher Education, Hassan. Page 59
  60. 60. Promotional Activities Glow sign Boards Point of purchase material A shape boards Banners Vehicle Paintings Calendars Incentives to traders Greetings Dairy plant visit by school children Cold Chain Door to door campaigns Deep freeze Mobile Quality testing Vise coolers Other awareness program-campaigns Cycles to delivery boys Contests/Quiz competition etc Fixture for parlours Other avenues Media Gifts to Institution Press Ads Milk bags translation Advt. and cable network Gifts to agents Trade shows Dealers/consumer contacts Exhibitions 3.12.1 Some of the Advertisement promoting by KMF:- The KMF will handle advertisement of all products of the union, which is in Bangalore. Launching of the New Product KMF is not investing more money on advertisement. Since it has goodwill of 30 years and also it is handled under government of Karnataka, consumers have faith on product and also there is a good market value. When we speak about the advertisement KMF only deals with giving advertisement at low cost by painting hoardings, boards at the outlets and retail shops. They also give advertisement in media and newspapers only on festive occasions to wish the customers and farmers. It doesn’t H.R. Institute of Higher Education, Hassan. Page 60
  61. 61. Promotional Activities hire any superstars to promote NANDINI products but it has only once had hired cine star Puneet Raj Kumar as brand ambassador. But most of media advertisements is given only to launch new products like that of GOOD LIFE & Flavored Milk etc. KMF launches their products according to the needs of customers like that of distribution of fat in the milk like 1.5%, 3.5%, 4.5% and 6%. KMF strongly approaches the feedback given by the customer on the spoiling of milk. H.R. Institute of Higher Education, Hassan. Page 61
  62. 62. Promotional Activities Methodology 4.1 TYPE OF RESEARCH: Descriptive method has been used in this research for the collection of data .As the research is related to the study of consumer behavior, which can more effectively be studied through direct question, experimental research will not be much effective. Also, considering the constraint, descriptive research is the most suitable design for this research. 4.1.1 Qualitative research Qualitative research allows you to explore perceptions, attitudes and motivations and to understand how they are formed. It provides depth of information which can be used in its own right or to determine what attributes will subsequently H.R. Institute of Higher Education, Hassan. Page 62
  63. 63. Promotional Activities be measured in quantitative studies. Verbatim quotes are used in reports to illustrate points and this brings the subject to life for the reader. However, it relies heavily on the skills of the moderator, is inevitably subjective and samples are small. Techniques include group discussions/workshop sessions, paired interviews, individual in-depth interviews and mystery shopping (where the researcher plays the role of a potential student, etc in order to replicate the overall experience). 4.1.2 Quantitative research Quantitative research is descriptive and provides hard data on the numbers of people exhibiting certain behaviors’, attitudes, etc. It provides information in breadth and allows you to sample large numbers of the population. 4.1.3 Descriptive research: Descriptive research is used to obtain information concerning the current status of the phenomena to describe "what exists" with respect to variables or conditions in a situation. The methods involved range from the survey which describes the status quo, the correlation study which investigates the relationship between variables, to developmental studies which seek to determine changes over time.  Statement of the problem.  Identification of information needed to solve the problem.  Selection or development of instruments for gathering the information.  Identification of target population and determination of sampling procedure.  Design of procedure for information collection.  Collection of information.  Analysis of information.  Generalizations and/or predictions. 4.2 SOURCE OF DATA: H.R. Institute of Higher Education, Hassan. Page 63
  64. 64. Promotional Activities Data which is collected for the first time is called primary data. In the study primary data includes the data which is collected from the customer directly with interaction. The study includes data got with personal interaction. 4.3 Primary and Secondary Data: The appraiser or market analyst must know what they are and what affects them. All data used in appraisals and market studies should be current, relevant, reliable, accurate, and conceptually correct. This article presents a discussion of each of these terms and their significance in the context of the data and in the analysis. The article then discusses the nature of potential errors that can affect primary and secondary data. Several categories of errors can exist. The analyst needs to be able to recognize the error, understand its significance and evaluate the applicability of that data in the analysis. Secondary data--Information from secondary sources, i.e., not directly compiled by the analyst; may include published or unpublished work based on research that relies on primary sources of any material other than primary sources used to prepare a written work. Secondary data has been gathered by others for their own purposes, but the data could be useful in the analysis of a wide range of real property. In general, secondary data exists in published sources. 4.3.1 Methods for Obtaining Primary Data: The analyst can obtain primary data through the process of direct observation or by explicit questioning of people. Observation: Observation as a data gathering technique focuses attention on an observable fact or inanimate entity such as a building or on an observable action or behaviour by an animate entity such as a homeowner or shopper. Observation of an inanimate H.R. Institute of Higher Education, Hassan. Page 64
  65. 65. Promotional Activities object is the easier of the two activities, but it is not free from error or misinterpretation. 4.4 Sampling: Sampling is a process of learning about the population on the basis of which sample is drawn. A sample is a subset of a population unit. Sample Design: Sampling is a practice a researcher uses to draw data on people, places, or things to study. Sampling allows statisticians to draw conclusions about a whole by examining a part. It enables us to estimates characteristics of a population by openly observing a portion of the entire population. The whole that the researcher wants to know something about is the population is called a sample. 4.5 SAMPLING TECHNIQUE: The sampling technique used in the study includes both simple random sampling as well as judgment sampling. Respondent Size: 100 Tool for data collection: Structured questionnaire Geographical area: Hassan city. 4.6 Data collection instrument The primary data collection instrument for the survey is self administrated and structured questionnaire which consists of preference and scaling questions. This method of data collection is quite popular, particularly in case of big enquires. The questionnaire consists of close-ended and open ended questionnaire. The study includes questionnaire of 15 questions to an effective study on promotional activities of Nandini Milk and It’s Products at Hassan City. H.R. Institute of Higher Education, Hassan. Page 65
  66. 66. Promotional Activities 4.6.1 The modes of data collection: • Interviewing face-to-face