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Fruit juices (1)


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Fruit juices (1)

  1. 1. A comparative study on fruit juices Market research By ASHISH KUMAR KESHRI (PGD08017) Institute Of Management Studies, Noida 2010
  2. 2. Institute of Management Studies, NOIDA A Project Report on Comparative Study on fruit juicesAs a partial fulfillment for the award of PGDM Degree under AICTE (2008 - 2010) Submitted to: Submitted by:MRS. SONIKA SHARMA ASHISH KUMAR KESHRI PGD08017 2
  3. 3. To Whom It May ConcernThis is to certify that Mr. ASHISH KUMAR KESHRI Roll Number PGD08017 of PGDM6th term is a bonafide regular student of this institute for the session 2008 – 2010.He/ She have completed the project report titled “A Comparative Study onFruit Juices” under my supervision, as a part of partial fulfillment for the award ofPGDM Degree under AICTE. His/ Her report is satisfactory and not copied fromanywhere to the best of my knowledge.Date: Signature Project Supervisor 3
  4. 4. ACKNOWLEDGEMENTA work is never a work of an individual. We owe a sense of gratitude to the intelligenceand co-operation of those people who had been so easy to let us understand what weneeded from time to time for completion of this exclusive project.I want to express my special gratitude towards Mrs. Sonika sharma lecturer, IMS,noida for helping me in completion of my project.Last but not the least, I would like to forward our gratitude to all the people who alwaysendured me and stood by me and without whom I could not have envisaged thecompletion of my project. Contents1. INTRODUCTION ………............................................................... 8 to 39 1.1 General Introduction 4
  5. 5. 1.2 Objectives and scope of the Project 1.3 use and importance of the study 1.4 marketing research2. RESEARCH METHODOLOGY …………………………………… 40 to 433. PROFILE OF THE ORGANISATION:“Surya Foods & Agro Ltd”. …………………………………………. 44 to 514. RESEARCH ANALYSIS……………………………………………. 52 to 62 4.1 Consumer awareness for fruit juices. 4.2 Consumer demand for fruit juices 4.3 Consumer demographic profile and preference for fruit juices 4.4 Consumer preferred brand 4.5 Consumer preference for packaging 4.6 Awareness regarding the fresh gold 4.7 Competitors market share 4.8 Most popular flavor 4.9 Purchasing capacity of consumer 4.10 Juice variety 4.11 Consumer concern regarding features5. CONCLUSION……………………………………………………….. 63 to 656. RECOMMENDATIONS…………………………………………… .. 66 to 687. APPENDIX…………………………………………………………… 69 to 71 A) Questionnaire Sample B) Bibliography EXECUTIVE SUMMARY 5
  6. 6. The whole study or research explains about the consumer’s buying behavior and theirpreferences regarding fruit juices. For this five brands were taken into considerationReal, Real Active, Saint, Tropicana and Fresh Gold. Basically the emphasis was givento the Fresh Gold. In this research I tried to know the perception regarding the FreshGold juice.Consumer buying behavior is a generic term explains about the consumer choice orpreference that they have for a particular product. Consumer’s buying behavior tells thecompanies about the modifications or features of the products. For this research someof the main features were taken into consideration like flavor, availability, price,packaging and the most important “awareness”. Because during research I came toknow that there are so many people who even don’t know about the Fresh Gold thatthere is such kind of fruit juice available in the market. So I tried to focus on theawareness of the consumers. After this there are so many competitors in the market likeReal, Tropicana etc. but the competition become tougher when we talk about the localjuice makers and sellers.The consumer gets confuse when he has got the more options at an affordable price inrespect of quality, availability, packaging etc. and choose the product in which he feelsthe maximum satisfaction or the best deal.It is found from the research that people go for the product which is easily available andaffordable and also it should be according to their parameters. The strategy for the product can be changed by comparing the different factors thathas obtained from the research. Allocation of largest consumer is the important work forthe producer so that they can match their product nature with the preference of theconsumer who are more willing to buy fruit juices. 6
  8. 8. India is the worlds second largest producer of food next to China, and has the potentialof being the biggest with the food and agricultural sector. The total food production inIndia is likely to double in the next ten years and there is an opportunity for largeinvestments in food and food processing technologies, skills and equipment, especiallyin areas of Canning, Dairy and Food Processing, Specialty Processing, Packaging,Frozen Food/Refrigeration and Thermo Processing. Fruits & Vegetables, Fisheries, Milk& Milk Products, Meat & Poultry, Packaged/Convenience Foods, Alcoholic Beverages &Soft Drinks and Grains are important sub-sectors of the food processing industry. Healthfood and health food supplements is another rapidly rising segment of this industrywhich is gaining vast popularity amongst the health conscious.India is one of the worlds major food producers but accounts for less than 1.5 per centof international food trade. This indicates vast scope for both investors and exporters.Food exports in 1998 stood at US $5.8 billion whereas the world total was US $438billion. The Indian food industries sales turnover is Rs 140,000 crore (1 crore = 10million) annually as at the start of year 2000. The industry has the highest number ofplants approved by the US Food and Drug Administration (FDA) outside the USA.Indias food processing sector covers fruit and vegetables; meat and poultry; milk andmilk products, alcoholic beverages, fisheries, plantation, grain processing and otherconsumer product groups like confectionery, chocolates and cocoa products, Soya-based products, mineral water, high protein foods etc. We cover an exhaustivedatabase of an array of suppliers, manufacturers, exporters and importers widelydealing in sectors like the -Food Industry, Dairy processing, Indian beverage industryetc. We also cover sectors like dairy plants, canning, bottling plants, packagingindustries, process machinery etc.The most promising sub-sectors includes -Soft-drink bottling, Confectionerymanufacture, Fishing, aquaculture, Grain-milling and grain-based products, Meat andpoultry processing, Alcoholic beverages, Milk processing, Tomato paste, Fast-food,Ready-to-eat breakfast cereals, Food additives, flavors etc. 8
  9. 9. The emerging trends in the market have confused producers to sell their products togain appropriate profit. India is growing day by day in various sector and preference ofpeople also changing according to change in business trends. Consumer buyingbehavior is different according to the product. This study shows the consumerpreference with respect to fruit juices. The demand towards the product can be knownfrom the demographic profile, density of population, retail links and their expectationstowards the product. Fruit juices now a day become a social drink which captured theattention of each individual of the society. The restrictions for each type of alcoholicdrinks gave a ultimate way of demand for fruit juices. In Indian market the sever completion among the producers have encouraged themto go for innovative ways. The competitors have a strong belief towards their brand andproducts. Producers have inverted their preferences for marketing their products nearlocal consumers. The consumers are mostly lean towards the brands which comeacross them in the daily life while going through television, news papers, andmagazines, banners displayed in roads and from websites. The juice marked had turnedinto a competitive market as there are similar competitors in the market serving sametype of juice by different brand name. The brand name of fruit juices have changed theconsumer preferences because of their easy availability, price, quality, packaging,quality etc. Here in this case those type of fruit juices brand have taken into accountwho has their most market shares in the market. The consumer buying behavior shows a way to the competitors in what respect theycan enhance themselves to exist in the market. The blind interpretation of producerforce itself towards severe loss. The perception towards the individual product showsthat whether the consumer will buy it or not. The emerging changes observed in thedifferent levels of consumers. The consumer also changes their preferences accordingto their capability of buying for that particular product. The distinct characteristics maysometimes attract the consumers to buy the product which they can not have purchasedbefore. The retail chain also plays an important role towards it which shows theavailability of product at the time of need. The consumers are again distinguished intodifferent age groups because of their different consumption pattern of food. In somecase it is observed that fruit juices are only acceptable for sports person for energy as 9
  10. 10. well as for relaxation, but the health consciousness factor has affected a lot eachindividual so that they can drink fruit juices for good health. The campaign for fruit juiceshave solved much disbelief among the consumers. The study shows consumer buying behavior by considering the product likeTropicana, Real, Fresh gold, Saint and Leh berry. Some of the factors are taken intoconsideration like price, brand, quality, consumer type and profession of differentconsumers who purchase fruit juices. Their technique of buying is the key of our study.The buying behavior has an important role towards the growth of individual product inthe competitive market. The market is dynamic in nature and needs innovations forexistence. 10
  11. 11. 1.2 OBJECTIVES & SCOPE OF THE PROJECT To analyze the consumer awareness for fruit juices. This objective gives a clear idea regarding the consumer awareness towards the fruit juice as well as towards the different brands prevailing in the market. The consumer’s awareness creates a demand towards the particular product. Analyze the consumer; their buying behavior and demand. The consumer buying behavior is an important parameter which consist of consumer preferences. The demand of a project can be known from the consumer’s buying pattern and parameters that he considers during buying a fruit juice like quality, availability, price, packaging and delivery mode. The demand also depends upon some of the other factors like purchasing power population, promotional activities of product in the market and seasonality. Understanding the demographic profile of consumers. The consumer acceptance depends upon the knowledge and maturity level that he has gained during his age for the different food habits prevailing in the surrounding. The age factor is an important factor to know product demand for a particular age group. So the interest can be made to motivate those age groups for buying their product. Identification of influencing factor for purchase. 11
  12. 12. Consumers generally go for some of the general factors while purchasing a product like brand, company name, expiry date, price, ingredients added, price and quality. The perception which a customer interpret from the outer level of the product influence him a lot to buy that. The influencing factor of purchasing makes a producer to understand the customer need. 1.3 USE AND IMPORTANCE OF THE PROJECTTo know about the various aspect of juice market and also how to penetrate in the wellestablished market. Some of the things are required to know, which are as given below—(a). FRUIT JUICE MARKET AND CONSUMER BEHAVIORTHE MARKET SENARIO FOR FRUIT JUICESIndia produces about 9 million tons of fruits every year, growing at a rate of 12% perannum. The total market for fruit juices is 230 million liters which includes both packedand freshly made fruit juices. The proportion of packed fruit juices is small at just 3.4million liters just over 1% of market, but even this huge volume translate to just 20milliliters per capital consumption as against 45 liters in Germany, 42.5 liters inSwitzerland and 39 liters in USA. The key issue before the markets was to raise theconsumption of packet fruit juices. The consumer perception is not the constant one forthe different products available in the market. The perception of consumer dependsupon the advancement made by the producers which attracts consumers a lot and holdsthe market share is huge manner. The market of fruit juices is concerned about the factsbehind fruit juices so the need for it is not diminishing but it is rapidly increasing day byday. For every fruit juice there is certain amount of market share but the real holding ofmarket share depends upon the identity of the product by tacking into account price,brand, quality, quantity, packaging availability, flavor etc.The key Note Market Report on fruit juices and health drink covers the market for fruitjuice, health drinks and fruit drinks. In general, carbonates are excluded from this report, 12
  13. 13. although drinks of this type also be fruit based. However, ther is some overlap with thecarbonates sector as health drinks, which might be carbonated and available in ready todrink formats of cordials are included.For Indians drinking juice is not a new concept. Street corner vendors have beenpopular for years. Fruit juices in the unorganized segment are considered cheaper andfresher by the consumers, even though they are relatively unhygienic. The organizednatural juice market is currently in a nascent stage though it is growing at a healthy rate35-40% per annum. This market has had high entry barriers. Few customers areconvinced about packaged juice being preservative free, and therefore, as healthy asfreshly squeezed juice. The drinks market is relatively more mature and growing at ahealthy at 20-25%. In 2003, the total UK fruit juices and health drinks market was worthan estimated £ 2.19 billion at retail selling price (RSP), a rise of 6.6% on 2002. Fruitjuice was the largest sector in 2003, accounting for 40.2% of the total market. Despitethe relatively mature nature of the fruit juice sector, the market grew strongly in terms ofboth value and volume between 1999 and 2003. In addition, fruit juices, fruit drinks andhealth drinks recorded a high household penetration level. A number of factorscontributed to this growth, including the increasing interest in health and diet, which isundoubtedly one of the main drivers. In general, fruit juices and health drinks areregarded as healthy choices, certainly in comparison to alternative soft drinks, such ascarbonates.In addition, the strength of the economy and rising household disposable income levelshave contributed to the growth of premium-priced products, such as freshly- squeezedjuice.Over the next 5 years, key Note forecasts that the fruit juices and health drinks marketwill remain healthy, with sales growing by an average annual rate of just over 6%.Increasing concerns relating to health and diet will play a major role in the market, asconsumers move away from products that are perceived as being unhealthy, such ascarbonated soft drinks, towards more natural alternatives, such as fruit juices. Inaddition, growing awareness of the importance e of the Government’s ‘five-a- day’campaign to increase fruit and vegetable consumption will encourage new entrants into 13
  14. 14. the market. In particular, younger consumer might regard fruit juice as a convenient wayof boosting their consumption of fruit and vegetables. The fruit juice sector will be boosted by growing demand for premium-pricedproducts, such as smoothies. In addition, heavy marketing expenditure and theintroduction of new products that are fortified with vitamins and other additives shouldhelp to drive sales. In some European countries, drink with added vitamin A, C and Ehave proved very successful. Although this sector is still in its infancy in the UK, it couldshow rapid growth over the next 5 years.CONSUMPTION HABITS 81% of fruit juice consumption in India was unplanned and 38% was pure impulse. Planned purchase of fruit juice was prevented only in metros. 60% of fruit juices consumption happened outside the home. Fruit juice consumption was a group activity-just 2% of the population had the fruit juice alone. Indians prefer “fresh juices” made in front of their eyes. The origin of this preference lies in the belief that is packed looses freshness. In the past 15 years, more than 10 brands of tetra pack and bottled fruit juices have been launched in India. This brand also happen to be the tetra packed fruit drinks and belonging to the largest soft drink manufacturer in India. In a country used to having fresh food all the time, the consumer wanted to see the product. In food products at time seeing is creating the impulse!! tetrapack manufactures have defined the basic need of Indian consumers by not allowing the consumers to see the product. In a country like India which has limited budgets for packaging given the low disposable income level and thereby the packed foods don’t carry very attractive and inviting pack graphics, the lack of transparency adds to discomfort levels of the consumers. Research showed that more than 60% preferred to see the fruit juice they were buying. India is becoming a country which wants western style packing with Indian style taste and thins was posing a great challenge with limited cold storage and cold chain capabilities. 14
  15. 15. Vivita-a new entrant has tried to overcome the “freshness of the juice” issueby packing fruit juices in aseptic PET bottle with a no preservatives label. Theconsumer is reassured by being able to see the product before buying. INDIAN KEY SENSUS STATICS OF LAST YEARPOPULATION 1100 Mn.RURAL POPULATION 805 Mn (73%)URBAN POPULATION 289 Mn (26%)MALE POPULATION 578 Mn(52%)FEMALE POPULATION 506 Mn(46%)DENSITY 290/KM2*PERSON PER HOUSE HOLD 5.52*DISTRICTS 466URBAN AGGLOMERATION AND 3768TOWNSVILLEGES (INHABITED) 627000*excluding Assam and Jammu & Kashmir Table-1 15
  16. 16. (b). THE LATENT DEMAND AND POTENTIAL INDUSTRIAL EARNINGSFOR FRUIT JUICES IN INDIA The concept of is rather subtale. The term latent typically refers to something that isdormant, not observable, or not yet realized. Demand is the notion of an economicquantity that a target population or market requires under different assumptions of price,quality and distribution, among other factors. Latent demand, therefore, is commonlydefined by economists as the industry earning of a market when that market becomeaccessible and attractive to serve by competing firms. Latent demand, therefore, iscommonly defined by economists as the industry earnings of a market when that marketbecomes accessible and attractive to serve by competing firms. It is a measure,therefore, of potential industry earnings (P.I.E.) or total revenues (not profit) if India isserved in an efficient manner. It is typically expressed as the total revenues potentiallyextracted by firms. The “market” is defined at a given level in the value chain. There canbe latent demand at the retail level, at the wholesale level, the manufacturing level, andthe raw material level (the P.I.E. of higher levels of the value chain being always smallerthan the P.I.E. of levels at lower levels of the same value chain, assuming all levelsmaintain minimum profitability). The latent demand for fruit juices in India is not actual or historic sales. Nor is latentdemand future sales. In fact, latent demand can be either lower or higher than actualsales if a market is insufficient (i.e. not representative of relatively competitive levels).Inefficiencies arise from a number of factors, including the lack of internationalopenness, cultural barriers to consumption, regulations, and cartel-like behavior on thepart of firms. In general, however, latent demand is typically larger than actual sales in amarket. PRODUCTION OF FRUIT JUICES IN INDIA AVERAGE 2002 2003 2004 (1992/1994) (‘000 TONNES)Banana juices 9718 16820 16820 16920Mango juices 10108 10640 10780 10800 16
  17. 17. Ornage juices 1743 3120 3070 3070Apple juices 1205 1160 1470 1470Lemons and lime 863 1440 1420 1420juicesPineapple juices 956 1180 1310 1300Grapes juices 684 1210 1150 1200 TABLE-2 For reasons discussed later, this report does not consider the nation of “unitquantities”, only total latent revenue (i.e. a calculation of price time quantity is nevermade, though one is implied). The unites used in this report are U.S. dollars notadjusted for inflation (i.e. the figure incorporate inflationary trends). If inflation rates varyin a substantial way compared to recent experience, actually sales can also exceedlatent demand (not adjusted for inflation). On the other hand, latent demand can betypically higher than actual sales as there are often distribution inefficiencies that reduceactual sales below the level of latent demand. As mentioned in the introduction, this study is strategic in nature, taking anaggregate and long run view, irrespective of the players or products involved. In fact, allthe current products or services on the market can cease to exist in their present form(i.e. at a brand, R&D specification, or corporate image level) and all the players can bereplaced by other firms (i.e. via exits, entries, mergers, bankruptcies etc), and their willstill be latent demand for fruit juices at the aggregate level. Product and serviceofferings and the actual identity of the players involved, while important for certainissues are relatively unimportant for estimates of latent demand. In order to estimate the latent demand for fruit juices across the states or unionterritories and cities of India, we use to multistage approach. Before applying theapproach, one needs a basic theory from which such estimates are created. In thiscase, we heavily rely on the use of certain basic economic assumptions. In particular,there is an assumption governing the shape and type of aggregate latent demandfunctions. Latent demand functions relate the income of a state or union territory, city,household or individual to realized consumption. Latent demand (often realized asconsumption when an industry in efficient) at any level of value chain takes place if anequilibrium is realized. For firms to serve a market, they must perceive a latent demand 17
  18. 18. and be able to serve that demand at a minimal return. The single most importantvariable determining consumption, assuming latent demand exists, is income (or otherfinancial resources at higher levels of the value chain). Other factors that can pivot orshape demand curves include external or exogenous shocks (i.e. business cycle), andor changes in utility for the product in question. Ignoring, for the moment, exogenous shocks and variations in utility acrossgeographies, the aggregrate relation between income and consumption has been acentral theme in economics. Any study of latent demand requires that some standard be established to define“efficiently served”. Having implemented various alternatives and matched these withmarket outcomes, we have found that the optimal approach is to assume that certainkey indicators are more likely to reflect efficiency than others. These indicators are givengreater weight than others in the estimation of latent demand compared to others forwhich no known data are available. Of the many alternatives, we have found theassumptions that the highest aggregate income and highest income-per-capita marketsreflect the best standard for “efficiency”. High aggregate income alone is not sufficient(i.e. some cities have high aggregate income, but low income per capita and cannotassume to be efficient). Aggregate income can be operational zed in a number of ways,including gross domestic product (for industrial categories), or total disposable income(for household categories; population times average income per capita, or number ofhouseholds times average household income). Latent demand is therefore estimated using data collected for relatively efficientmarkets from independent data sources (e.g. official Chinese agencies, the worldresource institute, the organization for economic cooperation and development, variousagencies from united nations, industry trade association, the international monetaryfund, Euromonitor, Mintel, Thomson financial services, the U.S. industrial outlook andworld bank). Depending on original data source used, the definition of “frozen fruits andconcentrated fruit juices” is established. In the case of this report, the data werereported at the aggregate level, with no further breakdown or definition. In other words,any potential product or service that might be incorporated within frozen fruits andconcentrated fruit juices falls under this category. Public source rarely report data at the 18
  19. 19. disaggregated level in order to protect private information from individual firms thatmight dominate a specific product-market. These sources will therefore aggregateacross components of a category and report only the aggregate to the public. Whileprivate data are certainly available, this report only relies on public data at the aggregatelevel without reliance on the summation of various category components. In otherwords, this repot does not aggregate a number of components to arrive at the “whole”.Rather, it starts with the “whole”, and estimates the whole for all states or unionterritories and cities in India (without needing to know the specific parts that went intothe whole in the first place). Base on the aggregate view of concentrated of fruit juices as defined above , datawere then collected for as many geographic locations as possible for the samedefinition, at the same level of the value chain. This generates a convenience sample ofindicators from which comparable figures are available. If the series in question do notreflect the same accounting period, then adjustments are made. In order to eliminateshort term effects of business cycles, the series are smoothed using an 2 year movingaverage weighting scheme (longer weighting schemes do not substantially change theresults). If data are available for a geographic region, but these reflect short-runaberrations due to exogenous shocks (such as would be the case of beef sales in astate or union territory or city stricken with foot and mouth disease), these observationswere dropped or “filtered” from the analysis. In some cases, data are available on a sporadic basis. In other cases, data may beavailable for only one year. From a Bayesian perspective, these observations should begiven greatest weight in estimating missing years. Assuming that other factors are heldconstant, the missing years are extrapolated using changes and growth in aggregatenational, state or union territory and city level income. Based on the overridingphilosophy on a long run consumption function (defined earlier), states or unionterritories and cities which have missing data for any given year, are estimated basedon historical dynamics of aggregate income for that geographic entity. Given the data available for the first three steps, the latent demand is estimatedusing a “varying- parameter cross-sectionally pooled time series model”. Simply stated,the effect of income on latent demand is assumed to be constant unless there is 19
  20. 20. empirical evidence to suggest that this effect varies (i.e. the slope of the income effect isnot necessarily same for all states or union territories or cities). This assumption appliesalong the aggregate consumption function, but also over time (i.e. not all states or unionterritories or cities in India are perceived to have the same income growth prospectsover time). Another way of looking at this is to say that latent demand for frozen fruitsand concentrated fruit juices, adds, drinks, and non alcoholic cocktails is more likely tobe similar across states or union territories or cities that have similar characteristics interms of economic development. The approach is useful across geographic regions for which some notion of non-linearity exists in the aggregate cross region consumption function. For somecategories, however the reader must realize that the numbers will reflect a state’s, unionterritory’s or city’s contributions to latent demand in India and may never be realized inthe form of local sales. Nonlinearities are assumed in case where filtered data exist along the aggregateconsumption function. Because India has more than 5,000 cities, there will always bethose cities, especially toward the bottom of the consumption function, where non-linerestimation is simply not possible. For these cities, equilibrium latent demand is assumedto be perfectly parametric and not a function of wealth (i.e. a city’s stock of income), buta function of current income (a city’s flow of income). In the long run, if a state or unionterritory has no current income, the latent demand for fruit juices is assumed toapproach zero. The assumption is that wealth stock fall rapidly to zero if flow incomefalls to zero (i.e. cities which earn low level of income will not use their savings, in thelong run, to demand concentrated fruit juices). In a graphical sense, for low incomecities, latent demand approaches zero in a parametric linear fashion with a zero-zerointercept. In this stage of estimation procedure, a low-income city is assumed to have alatent demand proportional to its income, based on the cities closest to it on theaggregate consumption function. Based on the models described above, latent demand figures are estimated for allmajor cities in India. These are then aggregated to get state or union territory totals.This report considers a city as a part of regional and national market. The purpose is tounderstand the density of demand within a state or union territory and the extent to 20
  21. 21. which a city might be used as a point of distribution within its state or union territory.From an economic perspective, however, a city does not represent a population withinrigid geographical boundaries. To an economist or strategic planner, a city representsan area of dominant influence over markets in adjacent areas. This influence variesfrom one industry to another, but also from one period of time to another. We allocatelatent demand across areas of dominant influence based on the relative economicimportance of cities within its state or union territory. Not all cities (e.g. the smaller towns) are estimated within each state or union territory as demand may be allocated toadjacent areas of influence. Since some cities have higher economic wealth than otherswithin the same state or union territory, a city’s population is not generally used toallocate latent demand. Rather, the level of economic activity of the city vis-à-vis isused.(c). FRUIT JUICE SEGMENT POISED FOR 30% GROWTH The branded fruit juice market in India is estimated to be worth Rs 500 croresorganized fruit beverage market (nectors, drinks and juices combined) and the segmentis growing at about 30% per annum. Big players like Dabur, Pepsi, Godrej and ParleAgro are already in the market and in view of the swift growth in the market, newcomerslike Surya Foods and Agro, Mother Dairy, Ladakh Foods, Pioma Industries have comeinto the market with new product in recent years. Primary food processing is a major industry with a highly fragmented structure thatincludes hundreds of thousands of rice-mills and hullers, flour mills, pulse mills, and oilseed mills, several thousands of bakeries, traditional food unites and fruits, vegetableand spice processing unites in the unorganized sector. In comparison, the organizedsector is relatively small, with around 516 flour mills, 568 fish processing unites, 5293fruit and vegetable units, 171 meat processing units and numerous dairy processingunits at state and district level. In India is almost equally divided between the organized and unorganized sectors,with the organized sector holding 48% of the share. While products like juices and pilpconcentrates are largely manufactured by the organized sector, the unorganized sector 21
  22. 22. in foothold is in the traditional areas of processed items like pickles, sauces andsquashes. By size, pickles from the strongest category. No doubt Dabur Real Fruit Juice is the market leader followed by Pepsi’s Tropicana.The two major fruit juice in India, Tropicana and Real are going all out to tease Indiantaste buds with ethnic flavours. Godrej industries Food division has introduced fruitjuices under the Xs brand, which earlier only consists of only nectars. Parle Agro’sFrooti and N-Joi too are doing well in the market. Delhi-NCR based Surya Foods andAgro Ltd. Manufacturers of Priya Gold Biscuits has forayed into the juice segment.Mother dairy has recently launched the Safal brand of juices. Safal is currently availablein orange, mixed fruit, grape and an orange-apple combination. Ladakh Foods makersof the Leh Berry seabuckthorn berry drink, has now launched an apple-peachcombination juice and a mixed fruit variant. Ahmedabad-based Pioma Industries,makers of Rasna brand of soft drink concentrates, test market with a diluted mangojuice in Andhra Pradesh recently.(d). THE GROWTH FRUIT JUICE MARKETThis chance encounter with the wonder plant seabuckthorn was the reason LadakhFood was set up as a separate company in 2002 to manufacture and sell seabuckthornjuice as LehBerry. Ladakh Foods today claims to be one of the fastest growing fruit juicecompanies in a fiercely competitive environment where big names such as Dabur andPepsi already hold substantial market shares. Even when the fruit juice/ nectar market isprojected to grow at scorching pace of 40%, a Tetra Pak study has found that awhopping 86% of the juice market is still lying untapped.Perhaps one of the main reason why milk major Mother Dairy announced it is jumpingon to the bandwagon of fruit juice. The company has launched packaged fruit juicesunder its flagship brand, safal. Starting from Delhi, the product is scheduled forlaunched on a nationwide scale in the months to come.Pricing is one of the major worries. Price is a barrier to this category because when yougive fresh juice, packaging becomes critical. So, what the industry is now trying to do isoffer different packaging to suit different price point while simultaneously working onways to offer better quality and improved taste. Pricing is also the downfall of fruit juice 22
  23. 23. importers, which distributes the Australian Brand Berri in the South, “It is difficult tomake inroads into the middle class as it finds the prices prohibitive. Sales tax onimported products is not uniform across the States.Taking advantage of the health consciousness pervading the market, Adluri Foods hasintroduced cranberry juice (something that the local brands also have done) and istesting a mixed vegetable juice and cocktail of apple, carrot and orange in the market.Pepsi recently launched Tropicana Tropics Mango Nectar, which made entirely frommangoes sourced from within India, as against other flavors for which sourcing has tobe done from other countries. The introduction of Tropics Mango Nectar will be followedby Tropics Litchi and Tropics Guava. India is now among the top teen markets forTropicana worldwide. Significantly India is now an approved source for mango pulpwithin the Tropicana worldwide system, and can soon emerge as a major sourcing basefor other exotic fruits for Tropicana’s international market. Which means that if the fruitjuice producers work on future development of backward linkages, the pricing issueplaguing this industry can be better tackled. Besides, the industry has already begun tooffer packaging solutions to address different price points like a 125ml pack of fruit drinkMaaza from Coca-Cola India at just Rs 5 and 500 ml Tropicana blend for Rs 25.With the people turning more health conscious, the non carbonated beverage segmenthas become one of the fastest growing and most exciting businesses at the moment.For some time now, manufacturers have experimented with some of the formulation andtaste issues, offering the consumers better tasting, more healthful alternatives. Evolvingfrom drinks containing a hint of herbs or vitamins, beverages have become an importantdelivery vehicle for efficacious amount of nutritional ingredients. Beverages are unusualproducts in that everyone expects to try new varieties, even from established brands.While all segments of the beverage market are evolving, the growth seems to bedirected more towards healthy, light and low-calories drinks, in particular organic andfruit juice varieties.The Rs 500 crore non-carbonated beverage market in the country is composed of fruitdrinks, nectar and juices. While the Fruti drink segment is estimated at Rs 250-300crore(branded and packed), the juice market is valued at Rs 150 crore and the nectar is a 23
  24. 24. small category of about Rs 35-50 crore. And the popular brands vying for a share in thesector are Parle’s Frooti , Godrej’s jumpin, Coca- Cola’s Maaza, Pepsi’s Tropicana, andDabur’s Real,and branded fruit juices from Surya Foods (Fresh gold)among others.The Rs 1,100 crore health food drinks (HFD) market, classified into two categories ofwhite and brown segments, has remained stagnant for the last several years despiteGSKCH (Glaxo Smith Kline Consumer Healthcare) and Cadbury’s attempts to activatethe category.Dabur’s Real Fruit Juice in 9 FlavorsDabur’s flagship brand Real fruit juice is a market leader in the packaged fruit juicecategory. Real was launched in 1996 and the brand has carved out niche for itself byclaiming to be the only fruit juice in packaged form that is 100% preservative free. Realwith a market share of 55% offers its consumers the largest range of 9 juices thatcomprise orange, mango, pineapple, mixed fruit, grape, guava, tomato, litchi andcranberry.Real Junior, available in 125 ml packs, targets children below six years. It has twofavorite flavors of mango and apple enriched with calcium. Real Active, 100% fruit juicewith no added sugar, gives the goodness of fruit without adding extra calories. Today itis available in orange, apple, and orange-carrot variants. Real Active orange carrotjuice, India’s fist packaged vegetable juice, is a combination of juicy orange and sweetcarrots.Dabur Food producers around 50 million liters of juice annually through its state-of-the-art facility at Birganj, Nepal. In august 2004, the company commissioned a multi-fruitprocessing facility in Siliguri, in West Bengal, set up by Pasadensa Foods, a whollyowned subsidiary of Dabur Foods Ltd. Spread over 11 acres and geared to process 150tons of fruit per day, it has the capacity to produce 192 tons of pulp/concentrate. Theplant procures fruit worth Rs 6 crore from West Bengal, North-East, Bihar, UttarPradesh, Maharastra, and Andhra Pradesh. It has the highest capacity utilization byprocessing pineapple, litchi, guava, mango and grape round the year.Gogrej Xs Fruit Juice is packed with extra tang and extra fun. 24
  25. 25. Xs range of fruit nectar has more fruit making it thick and tasty. Also the vitamins andcarbohydrates present in it provide extra energy for fit and healthy living. Available inorange, litchi, mango, and pineapple flavors, Xs comes in tetra Pack of 200 ml and1000ml.Pepsi’s TropicanaPepsi’s Tropicana brand fruit juice has registered double digit growth and has outpacedthe growth off the packaged fruit juices market in India. India is a very important marketfor Tropicana and is among the top 10 biggest markets for the brand. The companysources orange juice concentrates from Brazil. Tropicana is available in orange, apple,grape and cranberry flavors and a cocktail in Ruby red. They come in Tetra packs ofone liter and PET bottles of 500 ml and one liter.(e). FRUIT JUICES GO LOCALThe two major fruit juice makers in India Tropicana and Dabur are going all out to teaseIndian taste buds with ethnic flavors. PepsiCo terms these as flavors that are morerelevant to Indians.For Tropicana India is providing to be a good investment as according to top officials inthe company, “India is among Tropicana’s top ten markets which is continuously movingup having registered a stong double digit growth last year”. But they did not reveal anynumber.The company wants to ensure that the strong growth continues and also that the marketexpands further. To this end Tropicana has launched a sub-brand Tropicana Tropicsand is introducing new flavors mango nectar, guava pulp and litchi juice under thisbrand. It may be recalled that Pepsi had launched mango and litchi flavor earlier underits fruit drink brand ‘Slice’ in returnable glass bottles.The new variant are expected to come for around Rs 50 per liter as these come underthe category of ‘less than 20 % fruit pulp’ making them less pricy than Tropicana fruitjuices all of which retail at above Rs 70 per liter. Tropicana juices have 80 percent fruitpulp content. 25
  26. 26. At present Tropicana have about seven flavors in the market – apple, pineapple,orange, apple orange, grape and mix fruit. Tropicana is also looking at making India thesourcing hub for certain varieties of fruits mainly mango. Pepsi is already exportingnearly 20,000 tons of mango pulp and concentrate predominantly to west Asia andEurope from India. The company is now working on building the same capacities forother fruits like guava, pineapple, papaya pulp, grapes, and pomegranate. PepsiCoteamed up with Punjab, which is expected to start producing results very soon. Thecompany is now looking for a similar deal with pineapple farmers in Kerala. According toPepsiCo India spokesperson, the company has begun trials of pineapples imported fromThailand and the Philippines in Kerala. At present the company sources organic juiceconcentrates from Brazil but through the ongoing project, it is trying to develop a largegrower base, which can produce high juice yielding oranges to match its requirements.“India produces 47 million tons of fruits which provides us as exciting export opportunitywithin the Asia Pacific region”.Dabur Foods is also going local with a vengeance with its fruit juices. It is also aiming toexpand its market by introducing juices with a lower price tag. The company haslaunched a new brand ‘Coolers’ in four variants – green mango, pomegranate, jamun,and water melon with one liter of Cooler priced at Rs 50. Coolers like Tropicana Tropicsalso contain only 20 % of fruit pulp against over 80% of Real variants. Dabur is alsoaiming at expanding its consumer base. Dabur’s Real brand of fruit juices has provedvery successful contributing as much as 85% to the company’s Rs 85 crore turnover lastfiscal. According to the company Coolers has been launched of Rs 12 crore, intoresearch into consumer needs and development of processing capabilities andparameters on the other.(f). FACTOR AFFECTING DEMANDA. POPULATIONPopulation growth in India is currently 2 per cent per year and varies from state to state.The states with the highest per caput fruit consumption are usually those with lowerpopulation growth rates. According to official statistics, population growth is expected todecline to 1.5 % per year by 2011 when the total population of India is expected to 1.2 26
  27. 27. billion. Significant potential exists to expand fruit consumption in rural areas; states withcurrently low per capita consumption are increasingly evident in urban areas, forvirtually all income groups with the higher income levels showing the highest per-capitaconsumption rates.B. INCOME AND PRICESTHE Indian economy has achieved significant growth over the past 20 years. Realannual GDP growth rates have averaged 4.7 per cent over a period, despite the Asianeconomy crisis and slow industrial growth in past five years. Real per caput incomelevels increased 3.4 per cent per year from 1981 to 1998, with household expenditurefor fruits and vegetables estimated to have increased 5 per cent per year over the sameperiod. Annual per caput fruit consumption also increased from 25 Kgs in 1981 to 31Kgs in 1998.There is a significant positive relationship between income and fruit consumption. Theconsumption of Tropical and other fruits is highly related to income levels. Data from theIndian Agriculture Research Institute indicate that the richest income group consumessix times more fruit than the lowest income groups, in both rural and urban areas, withper caput consumption in urban areas almost twice that of rural areas. Or rural areas,the overall weighted average of the income elasticity of fruit demand for the highestincome group was estimated at 0.283 compared to 0.826 for the lowest income levels.Similarly for urban areas, the income elasticites were 0.293 and 0.782 respectively.Thus, the highest the income the less the responsive is fruit consumption to changes inincome levels. Given this relationship between income and demand, lower incomegroups are likely to account for most of the future growth of the market in India, althoughhigh income groups may increasingly substitute tropical fruit for other fresh fruits as fruitconsumption in these groups approaches saturation.Prices of fruit have increased more than the General Price Index with total fruitconsumption generally highly sensitive to price changes, as discussed above. Asubstantial price differential exit between wholesale and retail prices as shown by table10 primarily due to the margins captured by intermediate buyers and sellers, perishability of product, and long distances between wholesale and retail markets. High retail 27
  28. 28. prices for fresh tropical fruit are one of the primary constraints to increasingconsumption, particularly among middle to low income households.C. CONSUMPTION HABITS AND PREFERENCESConsumers in India have become increasingly aware of the positive health aspects offruit consumption, particularly in urban areas. A mre diversified diet and interest inhealthier eating has led to increased consumption of all fruits. Prices also play animportant role in consumer preferences for individual fruits, with tropical fruit pricestypically lower than for temperate fruit. Temperate fruits tend to be consumed by thehigher income groups; while tropical fruit consumption is more wide spread. Largequantities of fresh unripe mangoes are utilized in household preparation of pickles andchutneys. The market for minor tropical fruits, such as passion fruit, carambola andavocado is expected to rapidly increase over the near to mid-term, with consumptionconcentrated in higher income groups at the present time.D. PROMOTIONAL ACTIVITIESFew national or regional promotional activities, either commercial or state-sponsored,have been developed to encourage domestic consumption of tropical or other fruits inpast years. However, nutritional education programmes by the government of Indiahave resulted in rising demand for higher quality fruit, as well as increased preferencesfor more varied diets (including more fruit consumption). A number of large agro-processing industries have initiated promotional programmes for processed fruit andjuice products in recent years, utilizing mass media and in-store promotions to enhancebrand recognition and encourage consumption.E. SEASONALITYA survey of three wholesale terminal markets in October 1999 revealed large variationsin price due to seasonality. Furthermore, despite some efforts to better managesurpluses due to seasonality, an estimated 25 % of total fruit production goes to wasteduring post- harvest handling, according to National Horticulture Board of the Ministry ofAgriculture for India. Although the Government of India has taken steps to improve theoverall conditions of the fruit industry, future growth is constrained due to inadequate 28
  29. 29. refrigeration and cooling facilities, remote market access and export infrastructure notmeeting the demand requirements for export of fresh fruits.(g). CONSUMERS PURCHASING BEHAVIOURThe availability of consumer food products in India has grown significantly since theeconomic reforms beginning in 1991. Indian consumers can now purchase domesticallyproduced cheese, wine, potato chips, ketchup, soft drinks, candy bars, breakfastcereals, ice cream, donuts, biscuits, frozen meats and vegetables, instant noodles, jamsand jellies, packaged grains and pulses, soups and some ready to eat packaged andfrozen meals. Availability of fresh produce is seasonal. Retail food sales in India wereapproximately $132 billion in fiscal year 1998 and are growing at 13% per year,according to the Ministry of Finance. The retail market for fruits and vegetables hasgrown at over 20% per year in the past few years. Retail sales of subsistence foodssuch as cereals, breads, pulses, and edible oils have started declining. As incomeshave risen, there has been a shift in consumption, from subsistence to higher valuefoods.Many Indians are vegetarian by tradition; moreover, many can only afford a vegetariandiet. Meast may be regularly consumed by less than 30 % of the Indian population, dueto its higher cost and predominance of vegetarianism and Hinduism. However, only 20%of the population is strictly vegetarian. Non vegetarians typically consume meat onlyonce or twice a week. Higher income consumers rely almost entirely on domestic helpfor their shopping. The domestic help buys staples, vegetables, and fresh foods fromlocal small grocers and vendors, and other products from a variety of generalmerchants. The middle class has diverse purchasing habits. Many families on theupper end use part-time domestic help to do their shopping, often necessitated bygrowing pattern of household with two working parents. Many families at the lower endof the middle class continue to do their own shopping. The poorer segments of theIndian population tend to buy basic staple with the first part of their paychecks, whichtypically are distributed on the first few days of each month. During the month, thepoorer customers will buy whatever fresh foods and consumer goods they can afford, 29
  30. 30. often filling in at the end of the month with some additional staples purchased on credit.In all classes, women do most of the shopping and make most of the food purchasedecision. Most consumers prefer local shops to larger supermarkets because ofproximity, personal attention and lower prices. Nearly 95% of consumers purchase freshfruits and vegetables from a local market or street vendor. Additionally, traditionalmarkets are considered the freshest source for foods.(h). OUTER FABRIC ATTRACTS CONSUMERSAs consumer preferences in the country are shifting towards healthy, natural foodproducts, the demand for non-carbonated soft drink is accelerating. In the face ofincreasing competition, companies are redesigning the packages that they offer theirproduct in. at the same time, safety, long shelf life, convenience and economic viabilityare important considerations while choosing packaging options.What are the international trends in the packaging of fruit juices? Can any one of thesetrends be replicated in India?Internationally a variety of packaging formats are being used for packaging fruit juices.One of the most popular is aseptic cartons. This is the most popular format in theorganized juice market in India accounting for over 60% of the market. The recent entryof Mother Dairy into the segment points to the growing popularity of this packagingformat. More than anything else the entire aseptic processing and packaging systemensures the availability of nutritious products in safe and hygienic formats, which arealso convenient to use. A look at any market in Asia will show how aseptic packaging isgrowing in popularity. The increase in demand for fruit juices in the recent years, and the growth in theirproduction is inevitably leading to an increase in demand for packaging options in India.What are the technological innovations that have been introduced in the sector to caterto the increasing demand? The increased demand has led to an increase in number of size, shapes and evenprinting technology innovations, besides the obvious one of ensuring improved product, 30
  31. 31. taste, quality. Manufacturers are getting more aggressive by offering new product toconsumers. Could you elaborate on the spin-cap and cold fill technology – packaging options arerelated technologies that Tetra Pack has recently introduced for packaging fruit juice.Which companies are using these technologies and what are their benefits ? What othertechnologies have been introduced recently for packaging fruit juices ? The spin cap is apack opening option that was introduced a couple of year ago. Used the world over, it iscurrently being used only by Dabur in India. Tropicana and Mother Dairy both use therecap option. Cold fill technology’s biggest benefit is that it ensures microbiological safety and abacteria free product while keeping the nutritional values intact through the use of agentle heat treatment process which retains original state of the product and ensuresthat the consumer gets value-for-money. Slim line packaging for fruit juices and its benefits over baseline packaging- The difference between the two is the aesthetics. There is no difference in thetechnology used in both these options. For both the manufacturer and retailer, slim linepackaging is easier to handle in the distribution chain. It also gives the manufacturermore surface area for graphics.1.4 Marketing ResearchMarketing research is a form of business research and is generally divided into twocategories: consumer market research and business-to-business (B2B) marketresearch, which was previously known as industrial marketing research. Consumermarketing research studies the buying habits of individual people while business-to-business marketing research investigates the markets for products sold by one businessto another.Consumer market research is a form of applied sociology that concentrates onunderstanding the behaviours, whims and preferences, of consumers in a market-based 31
  32. 32. economy, and aims to understand the effects and comparative success of marketingcampaigns. The field of consumer marketing research as a statistical science waspioneered by Arthur Nielsen with the founding of the ACNielsen Company in 1923.Thus marketing research is the systematic and objective identification, collection,analysis, and dissemination of information for the purpose of assisting management indecision making related to the identification and solution of problems and opportunitiesin marketing. The goal of marketing research is to identify and assess how changingelements of the marketing mix impacts customer behavior.Role of marketing researchTraditionally, marketing researchers were responsible for providing the relevantinformation and marketing decisions were made by the managers. However, the rolesare changing and marketing researchers are becoming more involved in decisionmaking, whereas marketing managers are becoming more involved with research. Therole of marketing research in managerial decision making is explained further using theframework of the DECIDE model:D —- Define the marketing problemE —- Enumerate the controllable and uncontrollable decision factorsC —- Collect relevant informationI —- Identify the best alternativeD —- Develop and implement a marketing planE —- Evaluate the decision and the decision processThe DECIDE model conceptualizes managerial decision making as a series of six steps.The decision process begins by precisely defining the problem or opportunity, along withthe objectives and constraints. Next, the possible decision factors that make up thealternative courses of action (controllable factors) and uncertainties (uncontrollablefactors) are enumerated. Then, relevant information on the alternatives and possible 32
  33. 33. outcomes is collected. The next step is to select the best alternative based on chosencriteria or measures of success. Then a detailed plan to implement the alternativeselected is developed and put into effect. Last, the outcome of the decision and thedecision process itself are evaluated.TYPES OF MARKETING RESEARCHMarketing research techniques come in many forms, including: • Ad Tracking – periodic or continuous in-market research to monitor a brand’s performance using measures such as brand awareness, brand preference, and product usage. (Young, 2005) • Advertising Research – used to predict copy testing or track the efficacy of advertisements for any medium, measured by the ad’s ability to get attention, communicate the message, build the brand’s image, and motivate the consumer to purchase the product or service. (Young, 2005) • Brand equity research - how favorably do consumers view the brand? • Brand association research - what do consumers associate with the brand? • Brand attribute research - what are the key traits that describe the brand promise? • Brand name testing - what do consumers feel about the names of the products? • Commercial eye tracking research - examine advertisements, package designs, websites, etc by analyzing visual behavior of the consumer • Concept testing - to test the acceptance of a concept by target consumers • Coolhunting - to make observations and predictions in changes of new or existing cultural trends in areas such as fashion, music, films, television, youth culture and lifestyle 33
  34. 34. • Buyer decision processes research - to determine what motivates people to buy and what decision-making process they use• Copy testing – predicts in-market performance of an ad before it airs by analyzing audience levels of attention, brand linkage, motivation, entertainment, and communication, as well as breaking down the ad’s flow of attention and flow of emotion. (Young, p 213)• Customer satisfaction research - quantitative or qualitative studies that yields an understanding of a customers of satisfaction with a transaction• Demand estimation - to determine the approximate level of demand for the product• Distribution channel audits - to assess distributors’ and retailers’ attitudes toward a product, brand, or company• Internet strategic intelligence - searching for customer opinions in the Internet: chats, forums, web pages, blogs... where people express freely about their experiences with products, becoming strong "opinion formers"• Marketing effectiveness and analytics - Building models and measuring results to determine the effectiveness of individual marketing activities.• Mystery Consumer or Mystery shopping - An employee or representative of the market research firm anonymously contacts a salesperson and indicates he or she is shopping for a product. The shopper then records the entire experience. This method is often used for quality control or for researching competitors products.• Positioning research - how does the target market see the brand relative to competitors? - what does the brand stand for?• Price elasticity testing - to determine how sensitive customers are to price changes 34
  35. 35. • Sales forecasting - to determine the expected level of sales given the level of demand. With respect to other factors like Advertising expenditure, sales promotion etc.• Segmentation research - to determine the demographic, psychographic, and behavioural characteristics of potential buyers• Online panel - a group of individual who accepted to respond to marketing research online• Store audit - to measure the sales of a product or product line at a statistically selected store sample in order to determine market share, or to determine whether a retail store provides adequate service• Test marketing - a small-scale product launch used to determine the likely acceptance of the product when it is introduced into a wider market• Viral Marketing Research - refers to marketing research designed to estimate the probability that specific communications will be transmitted throughout an individuals Social Network. Estimates of Social Networking Potential (SNP) are combined with estimates of selling effectiveness to estimate ROI on specific combinations of messages and media.• All of these forms of marketing research can be classified as either problem- identification research or as problem-solving research.• A company collects primary research by gathering original data. Secondary research is conducted on data published previously and usually by someone else. Secondary research costs far less than primary research, but seldom comes in a form that exactly meets the needs of the researcher.• A similar distinction exists between exploratory research and conclusive research. Exploratory research provides insights into and comprehension of an issue or situation. It should draw definitive conclusions only with extreme caution. Conclusive research draws conclusions: the results of the study can be generalized to the whole population. 35
  36. 36. • Exploratory research is conducted to explore a problem to get some basic idea about the solution at the preliminary stages of research. It may serve as the input to conclusive research. Exploratory research information is collected by focus group interviews, reviewing literature or books, discussing with experts, etc. This is unstructured and qualitative in nature. If a secondary source of data is unable to serve the purpose, a convenience sample of small size can be collected. Conclusive research is conducted to draw some conclusion about the problem. It is essentially, structured and quantitative research, and the output of this research is the input to management information systems (MIS). • Exploratory research is also conducted to simplify the findings of the conclusive or descriptive research, if the findings are very hard to interpret for the marketing managers.The five basic method of marketing researchWhile there are many ways to perform market research, most businesses use one ormore of five basic methods: surveys, focus groups, personal interviews, observation,and field trials. The type of data you need and how much money you’re willing to spendwill determine which techniques you choose for your business.1. Surveys. With concise and straightforward questionnaires, you can analyze a samplegroup that represents your target market. The larger the sample, the more reliable yourresults will be.• In-person surveys are one-on-one interviews typically conducted in high-traffic locations such as shopping malls. They allow you to present people with samples of products, packaging, or advertising and gather immediate feedback. In-person surveys can generate response rates of more than 90 percent, but they are costly. With the time and labor involved, the tab for an in-person survey can run as high as $100 per interview.• Telephone surveys are less expensive than in-person surveys, but costlier than mail. However, due to consumer resistance to relentless telemarketing, convincing people to participate in phone surveys has grown increasingly difficult. Telephone surveys generally yield response rates of 50 to 60 percent. 36
  37. 37. • Mail surveys are a relatively inexpensive way to reach a broad audience. Theyre much cheaper than in-person and phone surveys, but they only generate response rates of 3 percent to 15 percent. Despite the low return, mail surveys remain a cost- effective choice for small businesses. • Online surveys usually generate unpredictable response rates and unreliable data, because you have no control over the pool of respondents. But an online survey is a simple, inexpensive way to collect anecdotal evidence and gather customer opinions and preferences.2. Focus groups. In focus groups, a moderator uses a scripted series of questions ortopics to lead a discussion among a group of people. These sessions take place atneutral locations, usually at facilities with videotaping equipment and an observationroom with one-way mirrors. A focus group usually lasts one to two hours, and it takes atleast three groups to get balanced results.3. Personal interviews. Like focus groups, personal interviews include unstructured,open-ended questions. They usually last for about an hour and are typically recorded.Focus groups and personal interviews provide more subjective data than surveys. Theresults are not statistically reliable, which means that they usually dont represent alarge enough segment of the population. Nevertheless, focus groups and interviewsyield valuable insights into customer attitudes and are excellent ways to uncover issuesrelated to new products or service development.4. Observation. Individual responses to surveys and focus groups are sometimes atodds with peoples actual behavior. When you observe consumers in action byvideotaping them in stores, at work, or at home, you can observe how they buy or use aproduct. This gives you a more accurate picture of customers usage habits andshopping patterns.5. Field trials. Placing a new product in selected stores to test customer responseunder real-life selling conditions can help you make product modifications, adjust prices,or improve packaging. Small business owners should try to establish rapport with localstore owners and Web sites that can help them test their products. 37
  38. 38. Business to business market researchBusiness to business (B2B) research is inevitably more complicated than consumerresearch. The researchers need to know what type of multi-faceted approach willanswer the objectives, since seldom is it possible to find the answers using just onemethod. Finding the right respondents is crucial in B2B research since they are oftenbusy, and may not want to participate. Encouraging them to “open up” is yet anotherskill required of the B2B researcher. Last, but not least, most business research leads tostrategic decisions and this means that the business researcher must have expertise indeveloping strategies that are strongly rooted in the research findings and acceptable tothe client.There are four key factors that make B2B market research special and different toconsumer markets. • The decision making unit is far more complex in B2B markets than in consumer markets • B2B products and their applications are more complex than consumer products • B2B marketers address a much smaller number of customers who are very much larger in their consumption of products than is the case in consumer markets • Personal relationships are of critical importance in B2B markets.International Marketing Research International Marketing Research follows the same path as domestic research, butthere are a few more problems that may arise. Customers in international markets mayhave very different customs, cultures, and expectations from the same company. In thiscase, secondary information must be collected from each separate country and thencombined, or compared. This is time consuming and can be confusing. InternationalMarketing Research relies more on primary data rather than secondary information.Gathering the primary data can be hindered by language, literacy and access totechnology. 38
  40. 40. The research methodology based on the primary and secondary data both. Secondarydata are collected from different secondary sources of information.Primary data were collected by me at different places of Indirapuram (Ghaziabad) andNoida. I prepared a questionnaire which consisted of 9 questions and a suggestionspace at the below regarding the FRESH GOLD juice. I visited around 125 people atdifferent places to get their feedback about the product. Basically I tried to know howmany people were there who even know about this product because most of them wereunaware of this product. During the survey I visited food bazaar (shipra mall), foodbazaar (aditya city center) and shipra market, all the places at indirapuram only,because the store manager of food bazaar didn’t allow me to take the feedback ofpeople inside the premise of food bazaar so I took all the feedbacks from the peoplewho are coming out of the food bazaar at outside of the shop. After visiting these areas Ivisited my college campus (ims noida) and Haldirams Product Pvt. Ltd.(sec-63,noida) and got the feedbacks from their employees. Through this I got all thefilled form and consumers feedback.Then I started visiting to the retailers of Indirapuram only. I visited around 20 retailshops to get their feedbacks, because almost all the shopkeepers have denied to fill anykind of form so I got their views only by the conversation. They were having so muchcomplains regarding the supply and demand. 40
  41. 41. It gives a clear idea regarding the approach of the study to understand the buyingbehavior of the consumers for the fruit juices. The source of information of pastconsumer behavior for the fruit juices and the present consumer buying behaviorcompares the differences among the acceptance of product. The recent trends ofmarket also pay emphasis towards the consumer preference. The understanding thefruit juice scenario of India is a important study to make a conclusion regarding thegrowth of fruit juices in the market, acceptance of particular brand by the people, pastdraw backs made by the producers and recommendations by the consumers.The review of theoretical concepts which are the research based view, corecompetence, sustainable competitive advantage concept and the cost leader shipstrategy. The theoretical concepts of demand in this study show the demanddetermination process of a particular product prevailing in the market with high marketshare.Source of secondary data are the books, magazines, internet, television, news papers.There is no particular or specific book where the complete information about consumerbehavior for fruit juices is available. In this case the information from different books iscollector and assimilated according to the study objective. The magazines like frontline,business world, Sunday times, Outlook provideds lot of information for it. Television isanother important source of information for this project from which recent data arecollected for study. The channels like Star News, Aaj Tak , NDTV has the importance forproviding the market share data of the products considered in the study. This is thecurrent source of information in once hand as a hard copy. The news papers (especiallyBussiness Newspapers) provided the desired information. Like Economic Times andBusiness Standard etc. these papers are so important that sometimes they play theirrole both as secondary as well as Primary source of data (because sometimes thecurrent information that is available through these papers are not even uploaded onInternet also.)Developing strategy based on the customer feedback i.e. collection of primary data byconsidering a definite sample size considered is the local area (Indirapuram). The datawhich are being collected from the consumer during the primary analysis are separatedaccording to their specific weightage. From the question five comparative questions are 41
  42. 42. considered for comparison. The open ended questions and the closed ended questionsused in the questioner for customer feedback have different weightage and areseparated to make a unique analysis. The main influencing questions are againanalyzed to get clear result from the analysis. The different companies are consideredfor realizing the perfect completion among them so that perfect interpretation can bemade upon them. For study the fruit juice brands which are considered are Real,Tropicana, Saint, Fresh gold and other competitors are also considered for thesecondary study but not encountered in the main study.For detailed comparison according to different parameters like availability, price, quality,flavor, customer feedback, packaging the questioner are sorted out and the ranking arecalculated. The ranking is made like first, second and third. The First rank the highestthree points, the second rank has two points and the third rank has one point. Accordingto the rank the numbers of persons are calculated who have given the rank according tothe different parameters. The points obtained from the number of the persons gives riseto intermediate point. The summation of all points is a result of total point which is themain criteria for comparison.The techniques are used different for secondary analysis as well as per primaryanalysis. In secondary analysis the relevant data are obtained from news papers,magazines, television, and websites. For primary data collection the techniques usedare questioner technique and personnel interview. The data collection from the primarysource is analyzed by graphical methods. The questioners are separated according todifferent parameters and different points are assigned for them for perfect weightage toplace in the comparative graphs. The pie chart, bar graph and line graph are used inthis study to compare different parameters.After analyzing all my data I got from the consumers, I found that the main thing is toplace the product at the shelf of retail shops, so the public see it and get aware of it. Forthis we need to strengthen the supply chain. 42
  43. 43. 3. Profile Of The Organisation:“SURYA FOODS & AGRO LTD”. 43
  44. 44. Company Profile :Surya Food & Agro Ltd. was incorporated in November 1992 and commenced itscommercial operations of manufacturing & selling of biscuits under brand “Priyagold”October 1993. Over a period, they have established strong manufacturing capabilitiesand have invested substantially in developing consumer preference for our products.Their trademarks / brands “Haq Se Maango” & “Priyagold” have emerged as one of themost powerful brands in the FMCG sector. They are committed to invest in brands,manufacturing capabilities, deliverables and distribution strength.They have three plants located in Greater Noida, Lucknow & Surat. They alsooutsource some of their requirements to another plant located in Hyderabad. Theircapacities have reached 1,50,000 MT p.a., which along with strong brand buildingand distribution capabilities have enabled them to command a sizable market sharein the biscuit market despite competition from well-established players in the industry.After establishing their foothold in biscuit industry, they continued to adopt strategy toidentify and commercialize profitable growth opportunities by leveraging establishedbrand and distribution network. Following this strategy, they diversified intomanufacturing of “fruit juices” through their wholly owned subsidiary “SuryaFresh Foods Ltd.” in January 2006. The manufacturing facility is located at GreaterNoida, U.P. They have consciously invested in creating markets for fruit juices andhave established brands such as “Fresh Gold” & “Treat”. 44
  45. 45. Both the brands are also well established and have penetrated into the fruit juice marketaggressively by commanding considerable market share. They have also forayed into theaerated fruit drink segment with the launch of “Fresh Fizzy.”They are also aggressively marketing their products in institutional category. Presently theirproducts viz. biscuits and fruit juices are supplied to Airlines, Hotels, Railways, Canteens StoresDepartment (CSD) and organized retail outlets.They are also diversifying into manufacturing of “chocolate and toffee & candy” through ourwholly owned subsidiary “Surya Processed Food Pvt. Ltd.” at Haridwar, Uttarakhand, wherevarious fiscal benefits are available.Their strategy of strengthening the brands especially the umbrella brand “Priyagold” has resultedin creating immense brand recall value. They are continuing with our effort of strengthening thebrand with a scientific approach, which will result in growth of customer base, price premium,consumer loyalty which is expected to result in increased earning and ultimately enhancingenterprise value of our company.Thus the company’s manifesto is to build on the present strength created over theyears and diversify into products and geographic portfolio. We aim at achievingprofitable growth by penetrating into the consumption market to enhance marketshare by constantly innovating on product profile, investing in infrastructurethereby accelerating the top line growth to enhance the market share.Delhi NCR-based Surya Foods and Agro Ltd, manufacturers of Priyagold biscuits, hasforayed into the juices segment. It has set up a state-of-the-art manufacturing facility in GreaterNoida with an investment of Rs 25 crore. The plant has a capacity of producing 1.5 lakh litres ofjuice per day. Branded `Freshgold, the one-litre juice in cartons is available in supermarkets and malls in andaround Delhi for Rs 60. Speaking to Business Line, Mr B.P. Agarwal, Chairman, Surya Foods andAgro Ltd, said, "Though the juices are currently available only in the northern markets” The Rs 300-crore turnover company is also setting up a biscuit plan to launch it in thesouth by the next month. We are also working on a specific distribution network for the same."manufacturing plant in Uttaranchal to avail of the tax incentives. 45
  46. 46. "We are investing around Rs 20 crore on the plant with a capacity of 100 tonnes per day, whichwould be operational by December 2006," Mr Agarwal said.The company has been keeping a low profile with regard to advertising and promotions after itsnot-so-good experience with the `Priyagold khaao or khelo contest. According to Mr Agarwal,"The retailers did not give out the coupons to the end-consumers. Consequently, we had towithdraw the scheme from the market." However, he said that the company has earmarkedaround Rs 3 crore for promoting the juices. While tele-commercials have already begun onIndiaTV, the company is hopeful of running them on all other channels by the next is also in the process of sprucing up its exports operations. Currently it exports its biscuits tocountries such as Dubai and Nepal.According to Mr Agarwal, "The high level of taxation in the domestic market, which is a majorconcern, is one of the reasons why we are looking to increase export volumes."Explaining further, he pointed out that high input costs and taxes are affecting margins and profits.As fierce competition from other players is preventing the company from increasing prices, hesaid, "High taxes are even forcing manufacturing units to close down. In fact, we have already hadto shut down two out of six companys plants."While speaking on the companys performance, he said, "We face immense competition not justfrom competitors in organised retail but also from the unorganised market which holds almost 40%of the market share and has the benefit of not being subject to any taxes." The government needsto look into the matter before the situation worsens, he added.Quality AssuranceSurya Foods & Agro. (P) Limited ensures that the highest levels of quality are maintainedthroughout the manufacturing process. Each step of our processes undergoes strict checks atvarious levels, being supervised by our quality assurance team. All the products aremanufactured under 100% clean and hygienic conditions.Our speciality lies in our ability to deliver pure and natural juices in a wide variety of flavourswith no artificial ingredients and are completely safe for consumption. All the products arepacked in air-tight packaging materials to restore their freshness. The date of manufacturingas well as that of expiry are clearly mentioned on the pack so as to avoid any confusion. Onlyapproved products that meet the stringent standards laid down by the relevant food 46
  47. 47. authorities are sent for dispatch.Their ProcessesOur manufacturing processes are conducted under the most hygienic conditions, and wehave a clean manufacturing facility which is well equipped with a host of advanced andsophisticated machinery for our purposes. Many of our machines like Tetra Therm AsepticFlex, the latest sterilizers, are exclusively imported from countries like Sweden.Our versatile packaging department makes use of the most standardized packaging materialsto give our product an attractive appeal as well as to keep the contents intact and safe. Allthe products are stored in a capacious warehouse with cold storage facility, thereby enablingus to meet all forms of market demands in the most efficient manner.Their Strengths • Well developed infrastructure for efficient processing • A team of pro-active and qualified staff having years of experience • A wide variety of products in different flavours with high nutritional value • Quality checks in accordance with the national and international standardsConstant research and innovation to produce better products.Karishma kapoor - Brand Ambassador for PriyagoldMerely before couple of weeks, we had alluring missy Deepika Padukone signing for BSNL asbrand ambassador. Fine! We have one more hot celebrity getting roped in for brandambassadorship, but not for BSNL. Karishma Kapoor has been opted as new brandambassador for Surya Food & Agro Ltd; a U.P. based Food Company at Noida, known forPriyagold biscuits. Sooner, we will espy the pulchritudinous actress recommending threeproducts from the Priyagold stable – Butter bite, Butter bite Badam Pesta and Marie lite.Perhaps, this is the first time Priyagold has preferred for celebrity endorsement. And earlier, itwas TV personality Priya Tendulkar who plumped for these products a decade ago. Karishma 47
  48. 48. has spelled that its because of her personal preference for Priyagold products, she signed forbrand ambassadorship.Karishma Kapoor is the new brand ambassador of the Noida; U.P. based fast emerging foodcompany “Surya Food & Agro Ltd”, known for Priyagold biscuits. This is the first timePriyagold has opted for celebrity endorsement since the TV personality Priya Tendulkarendorsed the biscuit for Indians ten years back. For Karishma the product fits into her lifeseamlessly. She is a celebrity housewife, mother and concerned of the quality of what sheand her family consumes.Karishma will soon be seen recommending three products from the Priyagold stable – Butterbite, Butter bite badam pesta and Marie lite. The advertisements created are straight forwardbrand endorsement with no complicated storyline or special effects in the visual. Themessage to the viewers is clear.“We had been looking for a celebrity who can easily be associated with our product. InKarishma Kapoor we got that. “Karishma being a modern day housewife and a celebritymother is always concerned about her kid’s & family’s health in today’s hectic life, saidShekhar Agarwal, Director of Surya Food.“Priyagold biscuits are favorites in kids. I too have grown up eating these biscuits and like thetaste immensely. In fact I agreed to endorse the product it is because of my personalpreference for Priyagold products”. Said Karishma KapoorThe reason why the company has opted to keep the message direct and simple is the factthat such endorsements are easy to recall. Unlike other celebrity endorsements of similarproducts where film stars have been seen promoting biscuits, at the end of the day viewersfail to recall the product. Also Shekhar feels that biscuits are commodities and need to bepromoted as such.Chocolate newsSurya Food & Agro is going to introduce chocolates and wafers in November as part of its 48
  49. 49. plan to extend the product portfolio.Surya Food & Agro is a leading biscuit manufacturer of the `Priyagold` brand. This is a Noidabased company and has a turnover of Rs 400 crore. Now, the company is expecting its newproducts to register revenue of Rs 10 crore by Mar 31.Shekhar Agarwal, the director of the company said, "Our chocolate and wafers will beintroduced in the market when our Haridwar plant commences operations in November."He added, "Initially, our target is the north Indian market where Priyagold has a stronghold."He said that about 10 variants of chocolates and wafers would be launched there.Agarwal informed that the company has invested Rs 30 crore in the project for installingmodern machineries for the 10 tons per day capacity plant at Haridwar. The chocolates andwafers would be sold under `Priyagold` brand with a separate sub-brand for each Variant, hesaid.But, Agarwal denied to disclose the names of variants, but said they would be placed near theexisting names of big players like Nestle and Cadbury. The company will keep the price oftheir chocolates same as the leading companies.Agarwal added, "Our products will be cheaper as they would have more quantity in weight."The company would leverage on the existing network of Priyagold biscuits for distributionpurpose and offer more discount to retailers so that they are attracted to keep the products.The biscuit manufacturer, which also makes juices, has a considerable market share in Delhi,Uttar Pradesh, Haryana, Punjab and Rajasthan.Products / Services :We are manufacturer, suppliers and exporters of Biscuits such as :Butter BiteCrack N Cheers 49
  50. 50. Nice DayMarie LiteKids Cream ButterStrawberryChocolateCoconut crunchGlucose V ExtraMagic GoldSnacks Zig ZagOrangeCheez BitJeera TopCashewCheese CrackerElaichiMilkTrick-or-Treat Pizza BiscuitsSouthern Style biscuits such as Spices, Cheese & Bacon Bake, Cream Cheese & Jelly Bake,Berries & Cream Bake. 50
  51. 51. 4. RESEARCH ANALYSIS 51
  52. 52. The primary research analysis fulfill the objectives of the study. According to theobjective the demand for the fruit juice is more but if we consider a particular product outof the four product which we are taken into consideration are Real, Tropicana,Freshgold and Saint. CONSUMER AWARENESS FOR FRUIT JUICES If we compare the consumer awareness for each brand then it is satisfactory that allthe consumers have the knowledge regarding the fruit juices available in the market.According to the conversation during filling the questionnaire people drink fruit juice forenergy instead of getting relaxation. It is found that 78% consumer consume fruit juices 52
  53. 53. for energy. Though the caloric value of fruit juice is high it is consumed for the purposeof getting energy. The consumer awareness for fruit juice is more among all consumers. Consumers get aware for fruit juices through different modes The sources of awareness regarding the product are the T.V., News papers,Magazines, Websites, Banners etc. It is found that the banners displayed in differentplaces attract their attention towards the product a lot. Out of 100%, 13% (other) ofpeople attracted towards the banner advertisement. Television is the most demandedfor getting awareness regarding fruit juices and their changes made time to time. 38%consumers get the idea about fruit juices from television. CONSUMER DEMAND FOR FRUIT JUICES 53
  54. 54. As from the analysis 85% of people use to take juices daily. Out of which most ofthe people do not know about most of the brands which are available in the market, likefreshgold, leh berry, saint etc. They only know about those brands which they use intheir day to day life like Real, Tropicana etc.. The demand for fruit juices increasesbecause of the growing income of each individual and increase in purchasing capacity.The change in consumption food habit has really affected the demand of fruit juices.The brand name has a great influence towards sales. Most of the people say that Realis the best brand and they will go for Real only, lesser people than Real want to go forTropicana and subsequently the demand decreases among Fresh gold, Saint, Leh berryand others. The various campaigns organized by the fruit juices companied have alsoincreased the consumption demand for fruit juices. It is obtained from the primaryresearch that 53% of consumers prefer Real juice as compared to Tropicana, Leh Berry,Fresh gold, Saint. It is observed that Fresh gold has lesser consumer attracted towardsit shows the lesser demand by consumers according to various parameters which areexplained in the other analysis as followed. Leh Berry and Tropicana has the samedemand in the market because of their retail price in the market for which theconsumers buy it. The promotional factor which has great importance towards thedemand of the fruit juices. 54
  55. 55. CONSUMERS DEMOGRAPHIC PROFILE AND PREFERENCE FOR FRUITJUICES From the analysis it is found that the fruit juices consumption depends upondifferent age groups. During the survey I found that 43% of the consumers of age group20-30 likes to consume fruit juice. Subsequently 28% consumers from the age group30-40, 14% people from the age group 40-50, 7% consumers between the age group50-60, 3% consumers were above the age of 60 where as only 5% consumers werebelow the age of 20. 55
  56. 56. One more thing I got from the analysis of my questionnaire that out of 100% only62% people like packed juices where as 38% people like juices which is freshlyprepared in front of their eyes by local juice wala. They believe that the packed juicescontains many extraneous substances or ingredients and loose juices are fresh andcontains not any extraneous ingredients or preservatives so that the loose juices aremore beneficial than the packed one. They don’t like the taste of packed juices becauseit gives the taste like a cough syrups as they said. CONSUMER’S PREFERRED BRAND I conducted a survey among 120 people to know about their preferences, that atwhich brand they rely the most. The survey was conducted among five brandsFreshgold, Real, Tropicana, Xs and Saint. Among all these brands most of the peoplesaid that they like Real, Lesser said Tropicana and a very few said Fresh gold and otherbrands. As a result of the survey 46% people like Real where as 33% like Tropicana, noone said about godrej’s Xs and only 5% people said about fresh gold. 16% people likeother brands(saint, leh berry and other local brands) available in the market. Most of thepeople whom I met they don’t even know about fresh gold, they came to know aboutfresh gold through the questionnaire only. 56
  58. 58. As per the graph above shown the packaging is divided into four types, i.e. tetrapack, plastic bottle, can and glass bottle. From the survey it was analyzed that 70%of people like tetra pack, 18% of consumer like plastic bottle, 9% of consumer likecan and 3%of people like to have juice is glass bottles.AWARENESS REGARDING THE FRESH GOLDDuring the survey when I asked people about fresh gold, most of them have repliedthey don’t know about this product available in the market. After completion ofsurvey when I analysed the primary data collected I got that around 70% people arethere who don’t even heard about fresh gold. Only 30% people were about itsexistence. The people who know about this or who have tasted it earlier praised itvery much. 58
  59. 59. COMPETITORS MARKET SHAREThe competitors market analyzed from the acceptance of particular product or it canbe understood like that-how many customers retained by each fruit juice brand. It isstudied that real has captured the maximum number of customer in the market.From the figure below- the customer retention can be known. 59