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Unit Title: Marketing

Unit Code: 1

Date Issued 02.11.2012 Date Received:

Assignment Brief

Student Name: Lecturer Name: Mr Ratnesh Pandey

Student ID:

Internal Verifier Name Mr. M Azam

Rules and regulations:

Plagiarism is presenting somebody elses work as your own. It includes: copying information directly from the Web or books without referencing the material; submitting joint coursework as an individual effort; copying another students coursework; stealing coursework from another student and submitting it as your own work. Suspected plagiarism will be investigated and if found to have occurred will be dealt with according to the procedures set down by the College. Please see your student handbook for further details of what is / isnt plagiarism.

Coursework Regulations

3 4

Submission of coursework must be undertaken according to the relevant procedure whether online or paper-based. Lecturers will give information as to which procedure must be followed, and details of submission procedures and penalty fees can be obtained from Academic Administration or the general student handbook. All coursework must be submitted to the Academic Admin Office and a receipt must be obtained. Under no circumstances can other College staff accept them. Please check the Academic Admin Office opening hours. Late coursework will be accepted by Academic Admin Office and marked according to the guidelines given in your Student Handbook for this year. If you need an extension (even for one day) for a valid reason, you must request one, using a coursework extension request form available from the Academic Admin Office. Do not ask the lecturers responsible for the course - they are not authorised to award an extension. The completed form must be accompanied by evidence such as a medical certificate in the event of you being sick. General guidelines for submission of coursework: a) All work must be word-processed and must be of good standard. b) Document margins shall not be more than 2.5cm or less than 1.5cm c) Font size in the range of 11 to 14 points distributed to including headings and body text. Preferred typeface to be of a common standard such as Arial or Times New Roman for the main text.

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d) You are required to produce an academic report, answering the questions below with a word limit of 3500-4000 words (+/- 10%) e) You are required to reference sources with Harvard Referencing Style format. f) All course work must be submitted online on 13.06.11, www.stponline.org.uk. g) The copy of the course work submitted may not be returned to you after marking and you are advised to have your personal copy for your reference. h) All work completed, including any software constructed may not be used for any purpose other than the purpose of intended study without prior written permission from St Patricks International College.

Remember to keep your coursework receipt.

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Outcomes and assessment requirements

*Please see the Assignment Evaluation Sheet for Merit and Distinction criteria

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FEEDBACK FORM ONGOING

Student Name Student ID Unit Name Date of submission Lecturer

TUTOR FEEDBACK

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1 s t Dr aft Feedback

Date:

Strengths:

Areas of Impr ovement:

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2 n d Dr aft Feedback

Date:

Strengths:

Areas of Impr ovement:

Tu t or s S i g na tu r e

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Assignment Questions:

Marketing is the management process that identifies, anticipates and satisfies customer requirements profitably. The Chartered Institute of Marketing (CIM).

With this definition in mind, choose a wellknown organization and answer the following questions: 1. What is marketing, and how does the concept of marketing affect your chosen organization? Include arguments which highlight the organizations marketing process, and the costs and benefits of marketing. 2. What are the micro and macro environmental elements that influence marketing decisions in your organization? 3. How does your chosen organization pursue Segmentation, Targeting and Positioning activities? Propose new suggestions based on your findings 4. How does the extended marketing mix apply to your chosen organization? Analyze and give examples.

5. Identify different types of buyer behaviors and how they apply to your chosen organization? 6. How does the extended marketing mix apply to different marketing segments? Compare consumer vs. business markets, and International vs. domestic markets.

*Please note: Q1, Q2 & Q3 should be submitted as a draft in Week 6 and Q4, Q5 & Q6 in
Week 12 for feedback.

Refer to Page 2 of this sheet for outcomes and assessment requirements.

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Table of Contents:I II III 1. Executive Summary Introduction about the company Flagship product Amul butter What is marketing, and how does the concept of marketing affect your chosen organisation? Include arguments which highlight the organisations marketing process, and the costs and benefits of marketing. What is Marketing? What are the micro and macro environmental elements that influence marketing decisions in your organization? How does your chosen organization pursue Segmentation, Targeting and Positioning activities? Propose new suggestions based on your findings

1.1 2.

3.1 3.2 3.3 3.4 3.5 3.6 4.

What is Market Segmentation? What is Amuls Market Segmentation? What is Targeting? What is Amuls Targeting? What is positioning? What is Amuls positioning? How does the extended marketing mix apply to your chosen organization? Analyze and give examples. Identify different types of buyer behaviours and how they apply to your chosen organization? How does the extended marketing mix apply to different marketing segments? Compare consumer vs business markets, and International vs domestic markets. Conclusion Bibliography

IV V

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List of Diagrams and figures

1.1 1.2 1.3 1.4 1.5 1.6 2.1 2.2 2.3 3.1 3.2 3.3 3.4 3.5 3.6 4.1 4.2 4.3 4.4 4.5 5.1 5.2 Amuls Logo Amul Butters logo The Chart of Market Oriented Strategy. Marketing Concepts of Amul Concepts of marketing mix of Amul Costs and benefits of marketing approach of Amul Micro environmental factors Macro environment of Amul SWOT Analysis of Amul Primary Market Elements of Amul in B2C segment pie chart Secondary Market Elements of Amul in B2B segment pie chart Targeting strategies by Amul Features affecting consumer behaviour Promotion and positioning of Amul Butter Demonstrate the Diagram of Value Analysis Types of Marketing Mix Levels of Product Product Hierarchy Prove the Pull Strategy Used By Amul Distribution chart of Amul Business Buying Behaviour Factors that affect Factors that affect the consumer and business buying behaviour Two Different Buying Situations factors Affecting Demonstrates Ansoffs Matrix of Amul The Market Mapping Chart 12 13 15 15 17 18 19 20 22 26 27 28 30 31 32 33 34 35 37 38 41 42

5.3 5.4 5.5

43 44 45

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Executive Summary:
Marketing is a very famous word in business language. It is a element for every business to accomplish their goal. Peter Drucker Genero: interactive marketing and technology, 2007 wrote that, because the purpose of business is to create customer while Principles Of Marketing 5Th edition by Kotler, Armstrong, Wong and Saunders added and to create value for customer and build strong customer relationships in order to capture value from customers in return., the business enterprise has two fundamental functions: marketing and innovation. Marketing and innovation manufactures results and all the other are costs. Marketing is the distinctive, exceptional function of a business.

This case explains about a well known dairy company based in India known as Amul, their strategies, how market orientation, market research ,market segmentation, targeting and their positioning are conducted and how extended marketing mix is built in the current country and globally.

The conclusion of this report will facilitate the author to scrutinize the role and practice of marketing within the altering business environment with a crisp and modern overview of marketing and the skills to emphasize further study in the expert field of marketing.

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Introduction about the company

Amul is the largest food brand in India and world's Largest Pouched Milk Brand with an annual turnover of US $1700 million (200910) currently Unions making up GCMMF have 2.9 million producer members with milk collection average of 9.10 million litres per day. Besides India, Amul has entered overseas markets such as Mauritius, UAE, USA, Bangladesh, Australia, Hong Kong, Singapore, China, and a few South African countries. It manufactures, distributes, sells and exports dairy products in India and internationally. Amul has one of the largest such networks in India. It has a large product range. Its product range comprises milk, milk powder, health beverages, ghee, butter, cheese, Pizza cheese, Ice-cream, Paneer, chocolates, and traditional Indian sweet, etc. It is Indias largest exporter in dairy products. It consistently aims at evolving and sustaining devotion to quality, customer focus dependability and iconic profile for dairy products. The market is well known by Amul and it has been persistent brand. Amul has spurred the White Revolution of India, which has made India the largest producer of milk and milk products in the world. Currently the strength of Amul is its man power and employees.

Fig 1.1 Amuls Logo (http://rockersofarena.wordpress.com/2011/08/03/amul-logo/ )

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Product Amul Butter The Utterly butterly Delicious Amul Butter brand, is the dominating the dairy market in butter since 1955. Amul Butter which has 86% market share.

Fig 1.2 Amul Butters logo (http://www.famouslogos.us/netherlands-team-to-wear-amul-logoin-world-cup-2011/ ) Amul Butter has an enormous distribution reach of 500,000 retail outlets across India, including chief hotels, restaurants, eating joints, super-markets and common grocery shops. Amul butter has also tapped rural market across India. With its strongest brand Amul Butter, Amul has planned to set up a separate distribution on the product itself.

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1. What is marketing, and how does the concept of marketing affect your chosen organization? Include arguments which highlight the organizations marketing process, and the costs and benefits of marketing. 1.1 What is marketing? Marketing itself is a very intricate exercise which moves with and against a number of factors. Successful marketing strategies create a driving force to the product. There are sets of diverse definitions of marketing which the organisation seems to take into deliberation while captivating the markets. Amul seems to be resolute on merging businesses with innovation. Peter Drucker genero: interactive marketing and technology, 2007 wrote that, because the intention of business is to generate customer, the business enterprise has two main functions: marketing and innovation, while Principles Of Marketing 5Th edition by Kotler, Armstrong, Wong and Saunders added and to create value for customer and build strong customer relationships in order to capture value from customers in return. Marketing and innovation manufacture result; all others are cost. Marketing is the distinctive, exclusive function of a business. A marketing oriented loom means business responses to what customers want. The decision taken are pedestal on information in relation to the customers needs and wants, rather then what the businesses believe is correct for the customer. While a product oriented approach means a business builds up products based on what is fine at making or doing, rather than what a customer desires. This approach is typically criticised because it frequently leads to unproductive products-particularly in well recognized markets. Definition of market orientated approach (2008) [online] (http://tutor2u.net/business/gcse/marketing_orientation.htm) [Accessed on 22nd Nov 2011)

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customers Front-line people

Middle Management
Top Management
Fig 1.3 the Chart of Market Oriented Strategy. (Field Research)

Company: Objective : Deliver profitable and equitable returns to a large number of farmers for a long period of time .

Customer:It doesnt specifically target customer but it is to general public.

Collaborators:A majority of the suppliers are small or marginal farmers whoare often illiterate, poor,and with liquidity problems as they lack direct access to financial institutions. Again, traditional market mechanisms are not sufficient to assure sustenance and growth of these suppliers

Competitors: Banas is the main competitor of amul along with other emerging dairy companies like Nestle,etc

Context: New product with new innovation and tastes to b launched like cooking butter,low fat butter .

Fig 1.4 Marketing Concepts of Amul (Field Research) Divya Sharma Marketing Page 15

1.2 Marketing action at Amul management captures the real meaning of marketing concept and being approachable to the customer and their needs but it cannot take place except consciousness about customer will be enough to meet their anticipation. At Amul marketing seems to ponder on marketing blend, which are the 4 Ps .Managing marketing consist of five errands. Starting from categorizing target markets- the identification those customers that they want to make exchange with should be identified by the management. There is reliance on marketing research-management that has to accumulate information on present and potential customer needs.

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Amul has a variety of products with high quality and is designed with features to attract the consumers. It has a brand name. The packaging of the product is attractive and it gaurantees the consumer to provide the best from their side

Amul adopted a lowcost pricestrategy to make its products reasonably priced and attractive to consumers by guaranteeing them value for money.

Product

Price

Place

Promotion
Amul 's promotions are usually done through advertisements or their famous hoardings.Many believe that the charm lies in the catchy lines. That people laugh because the humour is what anybody would enjoy. They don't pander to your nationality or certain sentiments. It is pure and simple, everyday fun.

Amul has a vast distribution channel with 500,000 outlets across the country and internationally. This also includes Restaurants ,food joints, eateries,etc.

Fig 1.5 Concepts of marketing mix of Amul. (Mr.Manish- Marketing head Amul)

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costs
Advertising:

benefits
Creates good Brand image

Manufacturing

Captures large market share

Transportation

Survival in the market for long

Raw material

Gains the confidence of the consumer.

Labour cost

Increased sales

Additional cost( Electricity supply and water supply)

Gives knowledge about the market.

Fig 1.6 Costs and benefits of marketing approach of Amul (Mr.Manish- Marketing head Amul) Critical analysis:Amul has emerged as a successful market familiarized company over a period of time and it has facilitated them to bring no.1 butter product in the choices of the consumer minds. It is meeting consumers demand as they recently launched new products for health freaks called Amul lite butter .Its success lies in its strong marketing strategies and advertising campaign which is extremely eye catchy and are attractive.

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2. What are the micro and macro environmental elements that influence marketing decisions in your organization? The market environment is a marketing term and id subject to all the exterior forces of marketing that affect marketing managements capability to build and maintain successful associations with aimed customers. The market atmosphere comprises of both the macro as well as the micro environment. The factors and forces outside marketing that influence marketing managements capability to develop and preserve successful association with its target customers is known as Marketing environment. Considering the micro environment it is the companys internal environmental factors that influence marketing decision of the company.

Competitors

Market Intermediaries

Customers

Media

Suppliers

Micro environmental factors

Stake holders

Fig 2.1 Micro environmental factors (Field Work)

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The macro environment is totally in dissimilarity with micro environment, they are the company exterior factors which manipulate the marketing decision of the company. The following example given in the diagram tells us that which are the external factors and which are the internal factors which persuades the decision making of Amul.

Demographic There is no particular age group that is affecting Amul at present but because of change in the fashion trends people of all age group prefer healthy and nutritious products.

Economic There is a steep rise in the price of milk ,thus the production cost is increasing which can result in reduction of revenue generated

Natural Forces In winters the cows give less milk; this is when a demand for other alternatives rises. Growing middle class/urban population increase in demand.

Technological The installation of more than 3000 Automatic Milk Collection System Units (AMCUS) at village societies to capture milk fat content, member information, amount payable to each other and volume collected has proved extremely beneficial in ensuring fairness and transparency throughout the entire organization.

Fig 2.2 Macro environment of Amul

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Factors affecting the Decision making of the Amul: Suppliers: suppliers are an important link in the company's overall customer value delivering system. They provide the resources needed by the company to produce its goods and services. Suppliers developments can seriously affect marketing. Marketing managers must watch supply availability -supply shortages or delays, labour strikes and other events can cost sales in the short run and damage customer satisfaction in the long run. Customers: The Company must study its customer markets closely. There are different types of consumer markets. For ex. consumer markets, business markets, resellers market, institutional markets, government markets and international markets. Publics: There are many types of Publics but for Amul the main Publics are Media that includes newspapers ,magazines, radios, and TV channel stations ,Financial includes Banks, Investment houses and stockholders, Government, Citizen action that includes consumer organisations, environmental groups, minority groups and other pressure groups, And Local publics that include community organisation and neighbourhood residents. Competitors: The marketing concept states that, to be successful a company must provide greater customer value and satisfaction than its competitor do. Therefore, marketers must do more than simply adapt to the needs of target consumers which results in gaining strategic advantage by positioning their offers strongly against competitors offerings.

Market Intermediaries: are firms that help the company to promote, sell and distribute its goods to final buyers. They include resellers, physical distribution firms, marketing service agencies and financial intermediaries. They form an important component of the company's overall value delivering system. The company must partner effectively with them to optimise the performance of the entire system. Stake Holders: These are basically those groups of people who are directly or indirectly related to the organization for ex. employees, investors, government, Bankers, etc.

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Strength

Weakness

Opportunities

Threat

Creative advertising with Amul baby

Market Competitive and local variants in the market

The demand for local raw material is subject to fluctuate which in turn leads to variations of quality input.

Value addition

Milk vendors, the unorganized sector

High brand presence

Export potential Strong competition from MNCs.

High visibility

Salaries offered to the workers are less than the competitors.

Strong dependency on weak infrastructure.

Use of internet to sell its products Introduced hybrid products in the market

Affordable price

Competition from private dairies and local milk suppliers.

Excellent product quality and trusted name. Highly Diverse Product Mix Robust Distribution Network

Logistics of procurement

Smaller packages
Diversify product portfolio to enter new product categories.

Short self life of its products Completely dependent on villages for its raw material

The yield of Indian cattle still much lower than other dairy countries.

No frills packaging for rural customers at lower price.

Growing price of milk and milk products.

Fig 2.3 SWOT Analysis of Amul (Mr.Manish-Marketing Head- Amul) Divya Sharma Marketing Page 22

3. How does your chosen organization pursue Segmentation, Targeting and Positioning activities? Propose new suggestions based on your findings. 3.1 What is market segmentation? When a market is alienated into small groups of would-be or authentic customers who share parallel needs/wants, features, or buying behaviour is known as market segment. These sub-groups are not alienated by the supplier/ dealer, in its place they already exist. They are just acknowledged and be discriminated. When these groups are identified by the suppliers and are marketed by different products and services it is recognized as market segmentation. There are many basis on which a market could be fragmented. Such as: Geographic segmentation: While providing the customers with a service, it is important that the customers are at present or around the delivery point in order to receive the service. Demographic segmentation: While segmenting a market demographically, on the bases of Age, Gender, Family size, Occupation, Education, Religion, Income, Social class. Behavioural segmentation: It is based on the usage rate and loyalty of the customers. Psychographic segmentation: On the basis of the lifestyle, personality characteristics and social class factors taking into consideration.

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3.2 Amuls Segmentation:There has been no general recognition of the product forms in Butter product market. The consumer is mostly concerned if it is a healthy or comprises of synthetic elements. Product segmentation should be undoubtedly bordered. The complete segmentation exercise for Amul butter product is certainly determined by these variables. The first segmentation is between real and synthetic butter. The real butter is based on natural milk fats extracted from milk whereas the synthetic butter is synthetic products with butter or other flavours. It is not easy to segment Amul butter because of mixed audiences. A broad taste predilection seems to be another way to identify market. The market is also segmented on the basis of fat content. For segmentation, on the basis of fat content, market can be segmented as comprising butter without fat content more than 80%.Segmentation at Amul seems to be prejudiced by benefits given to the consumer. The nutrition content it gives to the consumer can be one of the benefits so one market could be the healthconscious segment. subsequent benefit is diversification in taste. Another important trend is the increasing demand for consumer convenience. This has led to introduction to single serving butter tubs, tetra pack packing for the products and smaller pouches. People who are using it on the breakfast table as a part of their menu at home i.e. in house use. Demographic is another way to segment the active and potential markets for Amul. Economic and demographic changes including rising disposable income, a growing proportion of working women becoming a part of the urban population and greater awareness due to exposure to global trends are leading to an increased demand for convenience and innovation in food products. This in turn has resulted in increasing demand for packed dairy products (traditionally prepared at home) and new international products and flavours. The brands consumer section is broadly alienated into two segments primary segment, comprising of children in the age group of 4-12 years and secondary segment, comprising of all adults who consider butter as a must have on the table. Also Market segmentation as it supplies butter to many industries which include bakeries and confectionary shops, pizza joints, snack shops, food joints, restaurants and other eateries.

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3.3 What is Targeting? Target marketing is the process of selecting one or more of the market segments and developing products and programmes that are tailored for each segment. Once the segment has been identified, management must evaluate the opportunities each segment offers.( Marketing Management 2nd edition by Hollensen) Once the market has been segmented and well acknowledged, Amul brand should check if they will be beneficial to serve the selected segment or not. The DAMP methods (discernible, accessible, measurable, and profitable) are used to benchmark the capability of the target market. (Strategic management book second edition by Alex Miller and Gregory G. Dess) Discernible how to differentiate the selected segment from other segments. Accessible how can a segment be accessed through market communication. Measurable will the segment be quantified and the size of the segment determined. Profitable will the serving of that segment be profitable.

Amul has realised that its potential customers are big hotels and other eating joints. To serve this purpose they have come up with bulk buying discounts and other attractive offers. 3.4 Amuls targeting strategies? Target market for Amul constitutes the Recreational purpose, fitness; Health. The Primary market consists of kids Fond of butter; Teens who are more experimental; youth- who are experimental as well as has more buying power; Working people; Housewives; and the elderly people. Whereas the secondary market revolves around Travel industry and Hospitality industryAirlines, Railways and local transport systems; leisure places like- Malls restaurants, food joints, eateries. Below are the two Pie chart diagrams both of Primary market and as well as the secondary market respectively, which will help us depict a proper termination on how Amul brand does its targeting.

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Primary Market Elements of Amul

4% 19% 45%

32%
Kids - 1-10 Teens - 10-16 Youth - 18-25 Elderly - 40 & above

Figure 3.1 the Pie Chart of Primary Market Elements of Amul in B2C segment. (Marketing Executive amul)

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Secondary Market Elements of Amul

20 hospitality 55 12 Confectionary industry Recreation travel industry

13

Figure 3.2 the Pie Chart of Secondary Market Elements of Amul in B2B segment. (Marketing executive )

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Changing retail environment

High profile locations: Amul retail stores are today present on campuses of Infosys, Wipro, IIM-A, IIT-B, Temples, Metro rail and railway stations in Gujarat and overall.

Targeting

Striking out on its own, with Amul Outlets or retail stores to deliver consumers total brand experience

Launched in 2002, there are now 400 Amul retail stores across the country, which contributed 3% to the brands total turnover last year.

Fig 3.3 Targeting strategies by Amul (Marketing Management executive)

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3.5 What is positioning? Kotler (2008) says the way a product is defined by consumers on important attributes the place the product occupies in consumers minds relative to competing products is known as the products positioning. In marketing, Positioning is the process of creating in the mind of consumer an image, reputation or perception of the company or its products relative to competitors Products are created in the factory, but brands are created in the mind. This is said by a positioning expert. The statements cited above elucidates that while positioning your product, Amul Butter brand must have a focal point on the way the customers are possible to think about the product. 3.6 Amul Positioning strategy: Amuls positioning relates to how its service is situated in its consumers minds. So therefore Amuls Ads are no longer just to create buzz, they are fashioned keeping in mind a enduring brand vision. Al Ries and Jack Trout constantly observe that Positioning is what you do the mind of the consumer. (Positioning: the battle for your mind New York: McGraw- Hill, 1981). As such positioning implementation intends to create consciousness regarding what does Amul as butter, mean to the consumer and how is it different from that of competitors. It seeks to toughen own current position and grab an uninhabited position between other brands and their hygienic availability. Packaging Amul in double packaging, which preserves the

freshness and nutritious value unharmed.

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Sociodemographic variables

Behaviouristic

Psychographic

Benefits Sought

age

readiness

lifestyle

delivery

gender

ability and experience

personality

product features

geography

loyalty

price/services

lifecycle family

usage frequency

income

innovativeness

occupation

education

events

social class

Fig 3.4 features affecting consumer behaviour (Marketing Executive Amul)

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Uses a variety of media to communicate. Aggresive marketing is done.

Most famous is billboard campaign .The MasterChef Of India promo invites hotel chefs to come up with recipes using as many Amul products as possible, and is conducted at city, state and national level.

The endearing polka dressed girl and pun at various issues increased brands fan following.

Below-the-line activity has grown too such as the Amul food festival, which has been held for the last four year between October and December in about 50,000 retail outlets.

Fig 3.5 Promotion and positioning of Amul Butter. (Field Work) Amul brand can point their product is by the value analysis. There are 3 factors which need to be considered in preparing value analysis by Amul brand they are as follows:1. Appearance (aesthetics). 2. Performance (function). 3. Economy of manufacture.

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Appearance (aesthetics)

Performance (function)

Economy manufacture

Fig 3.6 Demonstrate the Diagram of Value Analysis. (By Peter Stimpson)

The manifestation aspect is very vital for Amul as they are into the manufacturing industry and because of the first impression is the last impression it becomes crucial for them to have a lavish outward show of their Products in order to create a lavish impact. Along with the manifestation, the economy of manufacture is important to Amul as brand because it will assist them to recognize the taste of the product, raw material (Component) are high-quality or not because if its improper than it will influence the brand of the product.

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4. How does the extended marketing mix apply to your chosen organization? Analyze and give examples. The seven main factors to take into contemplation in order to satisfy the customers needs profitably in the extended marketing mix are:Product

Process

Price

Physical evidence

Promotion

People

Place

Fig 4.1 Types of Marketing Mix (Field Research)

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The Amuls extended marketing mix strategy are as follows:Product:Kotler , the marketing guru clearly observes that in order to be market leader, watch the product life cycle; but more important, watch the market life cycle. Kotler (2004) suggested that a product should be viewed in three levels:

Level 1: Core Product Level 2 : Actual Product Level 3: Augmented product

. What is the core benefit your product offers? Customers who purchase a brick of Amul butter are indeed purchasing more than just that. They are buying health.

it promise healthy as well tasty product for the customers. The aim is to ensure that adding features and benefits to ensure that their product offers a discrepancy advantage from their competitors.

What supplementary non-tangible benefits can you offer? Competition at this level is based around after sales experience, delivery and so on.

Fig 4.2 Levels of Product (Field Work)

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Augmented product: Delivery and credit to Wholesalers and retailers in stocking their product.Or else Amul should come out with free gifts on purchase of Amul butter.They can provide refrigerator to wholesaler and retailers to stock their product .

Actual Product:Packaging Brand name Amul

Core Product Amul is a healthy product. Nutrition Contains Milk Fats .

Product
: Fig 4.3 Product Hierarchy (Field Work)

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Package:Amul considers packaging as an element of product strategy. The obvious advantage in case of Amul butter as product offering is its packaging which retains and sustains the freshness and nutrition of the contents .Rising consumer prosperity means that consumers are prepared to pay a little more for the handiness, appearance, reliability, and prestige of better packages (7Ps-extended marketing mix, retrieved November 25th from

http://www.12manage.com) Amul since its commercial launch continues to reap the advantages of double packaging and also maintaining the temperature control for preserving the nutrition. The Packaging is very attractive and eye catching which shadow in the consumers mind. Promotion mix:Modern marketing of Amul is more than just budding a good health product, pricing it appealingly, and making it accessible to target customers is equally substantial. Amul consistently communicates with its customers. Amul uses a specific mix of advertising, sales promotion, and public relations a company use to chase its advertising and marketing goal. Thus it will help them to acquire higher market share as well it will them to enter a entirely different market with diverse customers and also it will them create brand image internationally which are its marketing objective. Communication tools Advertising Advertising has so permeated everyday life that individuals can expect to be exposed to more than 1,200 different messages each day (Advertising: Definition, 2007). Amul is comprehensively using above the line endorsement like TV, Magazines, Internet etc for which Amul has accomplished a larger customer base and as well as strike a chord in the existing customers mind to repurchase the product. Amul are using pull strategy for which their consumers are keen to buy their product. Amul uses aggressive yet simple strategy of advertisement .Advertisements over the TV as well as hoardings and billboards are extremely famous.

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PULL STRATEGY OF AMUL USED IN THEIR PROMOTION. AD Campaign

Demand

Figure 4.4 Prove the Pull Strategy Used By Amul. (www.marcleshay.com)

Price:The Amul has taken these dynamics into consideration when deciding a price. These are as follows: cost of production, competitive conditions in the market, competitors prices,

business and marketing objectives, price elasticity of demand and last whether it is a new or an existing product. Therefore in India, Amul butter has developed different pricing strategies for different regions over the years, for example like in metro cities Amul butter has extended a penetration and competitive pricing for which they have endured for so long and in rural areas they have set price value base pricing. This is show that Amul butter are observing in mind that as they want to be a magnet for a larger customer base they are using different pricing strategies for different level of income groups that is according to the standard of living of the people in each region At the time Amul was formed, consumers had limited purchasing power, and modest consumption levels of milk and other dairy products. Thus Amul adopted a Low-cost price strategy to make its products affordable and attractive to consumers by guaranteeing them value for money. This helped AMUL BUTTER to create its brand image in the household sector of the society.

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Place:Thus the most elementary part of marketing mix strategy the Place because after making all the product, then promotion and pricing the final needs to be distributed to end user that is consumer. Currently Amul places their product in the canteens, Retail stores, Restaurants and other Eateries. Amul products are available in over 500,000 retail outlets across India through its network of over 3,500 distributors. There are 47 depots with dry and cold warehouses to buffer inventory of the entire range of products. Amul transacts on an advance demand draft basis from its wholesale dealers instead of the cheque system adopted by other major FMCG companies. This practice is consistent with Amul's philosophy of maintaining cash transactions throughout the supply chain and it also minimizes dumping. Wholesale dealers carry inventory that is just adequate to take care of the transit time from the branch warehouse to their premises. This just-in-time inventory strategy improves dealers' return on investment (ROI). All GCMMF branches engage in route scheduling and have dedicated vehicle operations. (http://www.rediff.com/money/2005/sep/23spec.htm,

Accessed on 25th November 2011)

Fig.4.5 Distribution chart of Amul. (http://www.amul.com/m/about-us)

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People: This mainly includes the staffs that are employed by Amul and their training in order to provide a healthy and nutritious product for the customers. For example, Amuls employees must be well trained, in order to manufacture a product of Amul and also the wholesalers and retailers should know what are the ingredients are there and required languages and well turned-out in order to easily communicate with the customers that arrive. Amul butter should also think about motivating the staff to make certain that they provide non Zero defected products to the customers in order to keep the customers in touch with product. Physical evidence: Physical evidence is mainly the way Amul presents its products to the customers. For Amul, it is very significant to have a high end and luxurious impact on its customers and thus they have reached, every hotel, railway, bus stops, malls and small retail outlets and last the most important college canteens where their target are by far available of Amul butter is capable of the most modern products and flavours shows that physical evidence of extended marketing mix is achieved.

Process of service delivery: These are the procedures and mechanisms and the flow of activities through which the customers of Amul consume its services. The flow of activities for Amul could be: - Inspection of raw materials - Satisfactory materials in making of the product. - making of the product - Distribution of the Amul product through various regions, area etc (wholesaler and retailer) - serving the end user with best packaging and as well as a nutritious product.

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Critical Analysis: - According to the author, out of the 7Ps Amul Butter needs to work upon the People as its one of the 7Ps because the employees are not well skilled enough to produce non Zero defected product, as well as the communications skills are also fragile so therefore have the complication in communicating with its customers, retailers, wholesalers. Therefore in order to defeat the problem stated above Amul Butter needs to guide its staff at such a level where there are no defected products being produced as well as no communications problems are faced by Amul Butter with its suppliers and as well its potential consumers when buying the product. Even their Pricing Strategies has facilitated them to attain their marketing objective. Using different pricing strategies, that is Competitive and value based pricing for Urban and Rural areas respectively.

5. Identify different types of buyer behaviors and how they apply to your chosen organization? Philip Kotler (1965) in a book of marketing insights states that Consumer behaviour refers to the mental emotional process and the observable behaviour of consumers during search, purchasing and post consumption of a product or services. This means that t he consumer behaviour studies include how people buy, what they buy, when they buy, why they buy and what is their reaction after the product is being purchased. It also takes into the account the essential elements like psychology, sociology, anthropology and economics. Geographic factors :(These Geographic factors might include different regions of the country) Amul needs to keep in mind the different types of consumers taste and fashion, so therefore needs to keep a track of different types of taste and the purchasing habit in the different states of the country Demographic factors (These factors include Age, Gender, Family size, Religion, Income, social class). This one of the factors that majorly affects Amul Butter because firstly there is a change in the consumer buying habit i.e. taste, fashion and the disposable income of the person which is making consumers opt for the another product. Therefore in order overcome the problem as stated above Amul should continuously be in touch with customers so that they can keep a track on the trends in the market

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Business buying behaviour is the decision-making process by which recognized organizations ascertain the need for purchased products and services and identify, evaluate, and decide among alternative brands and suppliers. Organizations could be corporate, manufacturing firms, Service firms, Institutional & Government markets.

Environmental : Level of demand

Economic outlook Interest rates Rate of technological change Political and regulatory developments competitive developments Social responsibility concerns

Organizational

Objectives Policies Procedures Organizational structures Systems

Interpersonal

Interest Authority Status Empathy Persuasiveness

Indiviual

Age Income Education Job position Personality Risk attitudes Culture

Business buyers
Fig 5.1 Explain The Factors That Affect Business Buying Behaviour.

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The factors which affect business buying behaviour are as follows:-

Interest rates: - This is one of the factors which have affect Amul over the years. The reason why interest rate is affecting is because it is making difficult for Amul to buy their raw materials from their suppliers.

Competitive developments: Competitors in Butter industry has emerged successful in competing with other existing brands. Like for example the main competitor of Amul are Nestle and Britannia which have kept Amul on it toes for a quiet a few years. Therefore in order to eliminate or to be in the line with a competitor Amul needs to constantly review their marketing strategies and comes with newer variants or increase their market share so that Amul remains competitive with other competitors

Fig 5.2 factors that affect the consumer and business buying behaviour (Field Work)

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Factor Demand Customer

Consumer buying behaviour Direct demand from consumer, for Amul Buyer and user are same i.e. target consumer for Amul like teenagers, youth and kids. General, as in what the Amul manufactures for the consumers. Only for consumer durables goods for my product Amul. Mainly based on image of the retailer stocks up the product (Amul). Low Elastic Consumer are often price sensitive so low prices Long with middle men

Business buying behaviour Derived or a joint demand Not the same as the target consumer for example here the consumers for Amul will be other major Butter industry. Customer specifications i.e. as per the requirements of other major Butter making Industry. Critical and included in buying specifications Based more on the performances of the product (Amul). High Inelastic Competitive bidding takes place Short and direct

Specifications

Services support Customer characteristic

Quantity purchased Demand Pricing Intermediaries

Fig 5.3 the Factors Affecting the Two Different Buying Situations

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Critical Analysis:According to the author, Amul should revise their STP and stopcock a totally diverse segment that is Rural Areas and bring some novelty in the advancement of marketing by adopting Ansoffs matrix for their market development strategy where they will realise their impending growth strategies. Keeping into consideration, that people in the urban areas are very responsive in tasting; pricing the product so therefore Amul should have a apt market research details in place, to recognize what demand for their product is.

The original product Amul butter with a bit new innovations like different flavours of butter. New variants for ageing people and health freaks like low fat butter.

Rural market as the new segment.

Manufacturing cooking butter and Amalgamation in B2B sector.

Fig 5.4 Demonstrates Ansoffs Matrix of Amul (Marketing Executive Amul)

For example their segmentation in the rural areas (developing cities or areas in the country) might be geographic segmentation because this will make consumers aware that Amul Butter as a product is alive in the market. And for this to be done Amul butter should be present at the delivery point where customers repeatedly visit.

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Whereas their Targeting strategies might be mostly, aim at the health conscious segment as well as the primary market which consists of people who are health concious. However they should try to do creative styles of packaging which will catch the eyes of the consumers with promotional schemes like Buy 1 gets 1 free etc. Therefore Amul should keep in mind that, as first impression is the last impression they should try to fulfil all the needs and wants which are demanded by the consumers. Also they can enter in innovating new products like cooking butter, low fat butter, etc. High Priced

Nestle

Britannia

Standard image Local butter producers.

Healthy Image

Amul butter

Value for money Fig 5.5 The Market Mapping Chart. (Field Work) Then comes the positioning factor for Amul where in rural areas it should be stated on the base of Appearance, Performance, Economy of Manufacture. Therefore Amul butter should position their product in such a way that whenever consumers demand for butter, then first preference of choice should be Amul butter rather than the competitors products like Nestle lite or Britannia. The other way positioning the Amul butter in Rural areas is by adopting product positioning chart where it describes how new brands will relate to the other competing brands, for which Amul butter should adopt market mapping chart.

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6. How does the extended marketing mix apply to different marketing segments? Compare consumer vs business markets, and International vs domestic markets.

The worldwide globalization, liberalization of trade, innovation in logistics and transportation, as well as advances in communication and information technologies continue to erode the barrier of geographical distance between B2B companies in different countries. This implies that B2B companies should always pursue global branding in their market offerings. Adapting or standardizing the distribution channels depends on several factors which are the customer, the culture and the product. James C. Anderson and James A. Narus, (2006) Business Market Management: Understanding, Creating, and Delivering Value, pp. 15 and 213. The Amul butter as a product has attained internationally too many Continents like Amul Butter is available in India as well as other country like UAE / Bahrain / Kuwait/ Oman / Hong Kong / Shi Lanka / USA / Malaysia / Singapore / Qatar/ New Zealand. Rather than services Amul butter provides high superiority product to their customers. Amul butter has extensive range of product portfolio to catch the attention of various segment groups of consumers. For last six decades Amul as a product has shaped a name for itself and a market various products. The groundwork for development was to put spotlight on total health and nutrition content and grow a product which would stand on customer sensitivity. Price was the input factor that helped Amul butter for its accomplishment is their affordable price for customers. The way of Amuls promotional strategy they have fabricated a wonder world in customer mind. Their loom to business-related establishments like restaurants, five star hotels, and other miniature sized enterprises has gained consumer interest all over the worlds consumer and business sector segment. And also their online webpage is more striking an effective way of advertising. Amul butters way of getting to the customers and launch new products to the customers is a competent one.

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Critical Analysis:One of the most important changes which Amul butter did in its marketing mix strategies internationally market is with the price, product and promotion. They have largely stressed on this 3 Ps is because in international markets people are very responsive in trying new products so therefore Amul Butter has maintained its Nutrition Value content in double packaging (the reason being that international market is one of the budding market.) with utmost attention-grabbing design and shapes which has trapped the eyes of the consumers. Their pricing has altered, in relationship with India. Amuls marketing have their pricing approach as per the diversification in the social classes present in the country and also Amul butter have taken into deliberation the velocity of inflation in the country also taking into contemplation per capital earnings of the population.

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IV) Suggestions and recommendations:PLACE:Retail chain of Amul in India To cover the huge unstructured segment, Amul butter should be promoted as a retailing chain outlet in India on the lines of Cafe Coffee Day and Costa Coffee which is in the retailing of coffee. This outlet should contain all the variants of Amul butter in various flavours and quantity and it should also be served as free samples. This branch can be used to serve different flavours like butter with pepper ,cooking butter, at a very competitive price. This strategy will help Amul butter to cover a major mass of the vast unstructured segment which is more than Rs 500 crore. But, this is a highly dicey move and demands lot of capital so; Amul butter should first test by starting a few outlets.

PROMOTION The nutritious content of Amul butter should be painted and highlighted on the pack so that the customer can be more educated and distinguish Amul butter as a Healthy product. The quality standard of Amul butter should be accepted by reputed food safety organisation and this be highlighted. Taking the cost consideration into account, Amul butter can aim at distributor and dealer margins, this will make the retailers and the distributors promote Amul butter more resourcefully it should aim at increasing more consumer scheme. Amul butter can also promote Amul butter by providing various offering like. For this Amul should project its brand ambassador.

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Bibliography:Special thanks to Mr. Manish from the Marketing team of Amul to provide the appropriate information. Also special thanks to Mr. Sodhi (Managing Director of Amul) Books referred:1. Genero : interactive marketing & technology, 2007 2. Miller, A., and Dess, G., of Strategic management book. 3. Kotler, P. Armstrong, G., Saunders, J & Wrong, V. 2002. Principles of marketing. Third European Edition. Prentice-hall, Harlow: Pearson education limited. 4. James C. Anderson and James A. Narus, business market management: understanding, Creating and delivering value, pp 15 and 213. 5. Doyle p., Stern P., (2006), marketing management and strategy, prentice hall. 6. Kotler, P. and G. Armstrong, Marketing: An Introduction. Third ed.1993, USA: Prentice Hall, Inc. 7. Stimpson, P.S., 2006. Business Studies. Chennai: Chennai Micro Print (P) ltd. 8. Svend Hollensen .2010 Marketing management second edition .printed and bound by Graficas Estella,Navvaro,Spain.

Website Referred: http://www.rediff.com/money/2005/sep/23spec.htm http://hrlink.in/topics/the-success-story-of-amul-utterly-butterly-delicious http://www.slideshare.net/gkhawale/39042696-amul http://www.scribd.com/doc/51139429/15/Distribution-channel http://www.scribd.com/doc/24376073/Marketing-2 http://simclife.blogspot.com/ http://nl.blog.ninety10group.com/ http://www.authorstream.com/Presentation/ajay.dhutawale-558137-bcgmatrix-of-amul/ http://www.123oye.com/job-articles/business-corporates/productpositioning.htm http://www.oppapers.com/essays/Marketing-Environment/494439 http://www.brightmarketingsolutions.co.uk/glossary.asp http://www.scribd.com/doc/37048096/amul http://tytusblog.blogspot.com/2009/08/engineers-dont-have-clue-whatmarketers.html (Cover page) http://www.nddb.org/partners/gcmmf.html (Amul Logo)
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