Amul

Not just a brand of milk

The Taste Of India

Brand Building -Alumni Symposium, IMDR, Pune

February 22 2003

Amul
Indias largest Foods company Rs 2,500crore and growing

India is now the worlds largest producer of milk, more than the US, Europe and Australasia and it started its journey on donations from these countries !
Production of Milk in India
90 80 70 60
Million Tons

55.6

58

60.6

63.8

66.2

69.1

71.9

75.2

78.1

80.8

50 40 30 20 10 0 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-2K* 2000-01* Years

Amul- the genesis

The Amul brand is rooted in Indias rural economy :
includes 170 milk unions operates in over 285 districts covers nearly 96,000 village level societies is owned by nearly 10.7 million farmer members.

The Amul Brand

The Economic Times Surveys : (ETIG- ACNielsen) Most Trusted brands survey

Most Trusted Brands Rank '02 Rank '01 Amul 31 31 Dhara 96 78

Top 100 brands Survey

Biggest 100 Brands Dhara Amul Amul Spray Amulya

Rank '02 40 42 45 90

The Amul History:

The people behind the brand

Pioneering Institutions in Indias milk industry

Amul Dairy, NDDB (National Dairy Development Board, NDRI (National Dairy Research institute Karnal/Bangalore), L&T (Larsen and Toubro, engineering, Tetra Pak, Vidya Dairy, IRMA

Stalwarts in Indias milk industry :

Sardar Patel, Tribhuvandas Patel, Lal Bahadur Shastri, Morarji Desai, N. K. Khurody (Bombay Milk Scheme), Pestonji Polson founder of Polsons who started milk business in 1920s

Professionals in the Amul / Anand pattern :

Dr Verghese Kurien, Dr H M Dalaya, P H Bhatt ,V H Shah, K Kurien , Sylvie dCunha Very large no of dairy experts in different dairy fields

The Network

Amul Landmarks:
Brands across time
Marketing of milk to the Bombay Milk Scheme - 1950 Branded product sales with table butter - 1956/57 ( Akbarally, Mumbai; Empire Stores, Delhi; Spencers, Chennai/ Kolkata); 1945 first run Amul baby food ( roller dry) - 1960 Amul Ghee - 1960 Amul whole milk powder - 1965 Amul spray - ( spray dry) - 1965 Bal-Amul weaning food - 1968 Amul Cheese - 1964/65 Amul Chocolates - 1973

Amul Nutramul - 1978

Two- brand strategy - Introduction of Sagar butter - 1958; Sagar Ghee 1960; 1980 - Sagar SMP

Amul landmarks ..
Value add dairy products 1983- on
Amul Srikhand - 1983-84 - Sugam, then Amul

Amul UHT Milk - 1983 ( Tetra Pak)

Dhara ( operation golden flow) - NDDB/ GCMMF-1987 Amul Mithaimate - 1994 Amul Paneer - 1995 Amul Ice cream - 1998/99 Amul Indigenous sweets - Gulab Jamun etc -1990 on Amul cheese varieties expansion- Emmenthal, Gouda, Mozzarella-1997/98 Amul Pizza - 2001 Amul Masti Dahi- 1997/98 - stepped up 2001/02 Amul retail outlets - 2003

Amul Milk landmarks

Formation of First Co-op Milk society / Amul - Dec 16 1946 Marketing of milk in bulk to BMS - Bombay Milk Scheme - 1950 Milk supplied in insulated rail tankers from Anand to Bombay from NZ- 1950 under Colombo Plan 200,000 lit / day to Bombay alone by 1980, followed by organized long distance mktg. to Delhi (120k) and Kolkata (50K) Bottles - initially ( pasteurized)

Tetra Pak - 1983- onwards ( UHT)

Pouches - replaced bottles by 1983 ( pasteurized) Co-operative logo for all milk unions - 2001 Doodh- Doodh campaign, for the milk industry

1987 - First full train from Anand - Kolkatta of milk

Amul Landmarks
Brand name Amul meaning Priceless - 1954 Utterly Butterly Delicious + Amul Girl - 1967 - dCunha Associates GCMMF formation in 1974 to market produce of member unions Six hand logo - denotes the 6 milk prducers unions - Anand, Mehsana, Himmatnagar, Palanpur, Surat and Baroda ( gradually extended for all unions ; 2000 - 16 unions) GCMMF policy of handling marketing by Producers organization in addition to Procurement and Processing for full control without any middlemen Take over of Butter distribution from Voltas in Maharastra in 1978 Exports to the Middle east - 1983 - Ghee, SMP,Butter , cheese (now exceeds Rs 50 cr) Taste of India punch line - Late Kannan Krishnan of ASP - 1995 A gift for someone you love -chocolates - Radeus-K Kurien - 1978

Amul / GCMMF distribution strategy :

Create a network that can sell more than what can be produced
Butter + cheese national distribution by GCMMF in 1979 Amulspray - by GCMMF in 1979 - 1984

All Amul products via GCMMF - 1984

Largest exports to Bangladesh , then middle east Utterly butterly ads only on hoarding Adspend of GCMMF is always less than 1% of sales Most profitable product - milk powder 1976 - sales - Rs 55cr ; 1991- Rs 1,000cr ; 2002 - Rs 2,500cr - Largest Indian Food company now excluding local sales of milk and cattlefeeds which were quite substantial (over Rs 500 cr. Now) GCMMF retails universe exceeds half a million all over the country serviced by 50 sales offices and 4000 stockists

The building blocks of the Amul brand

Milk always was a priority, not value added products No preferences, no caste, no age , no quantity barriers Milk as an agent of social change : women proved to be better managers. The farmers were always a priority but unlike other brands / companies, higher returns were not from higher prices, but from economies of scale and national distribution.

Milk grid was used to balance / equalize the production and consumption of
milk and milk products - which helped members to take every litre of milk offered- that in turn encouraged milk production and procurement at DCS

GCMMF dairies today collect over 5 million litres of milk per day

Amul Brand Building

Value for money products : strong procurement system gave it the option of pricing very competitively Enjoying highest consumer confidence for value Amul were the first even before legal mandate to adopt Metric System and mark MRP on the packs. Amul were the first to stop advertising Baby Food even before the law and even before Nestle Only Amul made milk powders to meet full requirements of the Armed Forces sometimes even at the cost of market supplies for over 20 years Butter prices could have been hiked, but were not, since Amul believed by not exploiting price, they could stop competitors from entering. Pizza introduction meant to boost Cheese range;All Pizza majors now take cheese from Amul Retail venture , in Mumbai and Corporate campuses , to provide one -stop shop for Amul products Introduction of non traditional product range to help build the Amul Brand

IT to ensure the right price

GCMMF can today know sales data every night from across India; it also knows the price paid to the last farmer via its IT network

Milk- no caste, no age,no

preferences

Challenges to the Amul brand

Converting excess milk into value added products De-regulation of milk industry Competition from other majors- Nestle, Britannia, HLL Creating more Amuls