AmulAmul-The Taste of India

Case Study Presented by  Kavita Bavkar  Rachana Adkar

History of Amul
Amul (Anand Milk Union Limited), formed in 1946,is a dairy cooperative movement in India  It is managed by Gujarat Co-operative Milk Marketing Federation Ltd(GCMMF)  AMUL is based in Anand, Gujarat and has been a sterling example of Co-operative organizations success in the long term. The Amul pattern has established itself as a uniquely appropriate model for rural development.  Amul has spurred the White Revolution of India, It is also the worlds biggest vegetarian cheese brand.


Facts
Members No. of Producer Members No. of Village Societies Total milk handling capacity Milk collection (Total 2008 - 09) Milk collection (Daily average 2008 - 09) Milk drying capacity Cattle feed manufacturing capacity 13 districts cooperative milk producer union 2.79 million 13328 11.22 million liters per day 3.05 billion liters 8.4 million liters 626 Mts per day 3500 Mts per day

Reason to Success
y y y y y y y y

People power Brand umbrella Low-cost price strategy Introducing higher value products The distribution network Managing supply chain Business market Co-ordination

Mix Product for Everyone

Product for youth Amul launched chocolate milk under brand name of Amul Kool Koko targeting the youth. Product for diabetic people Indias first Pro-Biotic wellness Ice-cream & sugar free delights for diabetics Product for health conscious Amul launched low fat, low cholesterol bread spread. Product for the price sensitive India Low Priced Amul Ice-cream & affordable sugar whitener. Product for urban class Amul launched emmental gouda & pizza mozzarelia cheese

Amul Business Model

Condensed Ghee Butter Cream

Package Milk Ice-cream Beverages Dried Skimmed Milk Powder

Raw Milk
Amul never forgot its Primary Customer
Amul collects447,000 ltrs of milk from 2.12 million farmers

Customer Based Market Segmentation

Kids
Amul kool chocolate milk Nutramul energy drink Amul milk shake Amul Calci +

Women

Youth
Calories Conscious

Amul emmental cheese Amul cheese spread

Amul Lite Sagar skimmed powder Amul Lite slim & trim milk Nutramul Amul shakti health drink

Health conscious

Industry Analysis: Porters 5 Forces

Threat of new entrants is high because there is no entry barriers

Bargaining power of customer is high because of various competitors

Competitive Rivalry is high due to other brands & Local Players

Bargaining power of suppliers is low because the suppliers are rural milk producers

Threat of substitutes is high because of availability of other product

SWOT Analysis of Company

Strengths
Largest food brand in India High quality, low price Worlds largest pouched milk brand Annual turnover of $ 1504 million High diverse product mix

Weaknesses
Risk of highly complex supply chain Strong dependency on weak infrastructure Alliance with third parties who do not belong to the organized sector

Opportunities
Penetrate international market Diversify product portfolio to enter new product categories and expand existing categories like processed foods, chocolate etc

Threats
Competitors Hindustan Lever, Nestle, Britannia etc Still competition from MNCs in butter Growing price of milk and milk products Ban on export of milk powder

Strengths
Parent support Strong distribution network High demand of Amul Milk Chocolate Can make good utilization of established goodwill of better channel Good margin of profit

Weaknesses
No advertisements & promotions are made for Amul chocolate. Raw material supply volatile prices. Chocolate comparatively small business unit.

Opportunities

SWOT Analysis of Amul Chocolate

Threats

Low penetration consumption. Scope of launching new variants & extensions. Growing Population

Foreign multinationals. Change is needed according to trend and customers preferences. Amul has number of competitors like Nestle, Cadbury etc. Amul chocolate has not those much good advertising strategies to win over its competitors.

The 3 Cs...
Defending against Mahananda, vijay & other co-operative milk brands Aggressive moves against
Britannia, Nestle, Mother Dairy & Kwality

Customer extremely satisfied Moved from loose milk to package milk Ready to new products Improve socio-economic conditions

Competition

Customer

Company

Largest milk brand in asia More than 30 dairy brands Market leaders in ghee & butter Very strong supply chain Enjoys fine reputation Quality with affordability

Amul chocolate Introduction

y

Introduced chocolate brand in 1974

2003 year y To boost sale, Amul launched three new chocolates in under the brands Fundoo, Bindas, and Almond bar. y As a result Amul introduced festival season pack Rejoice came with six chocolates

Amul Chocolate
A new tag line: Amul chocolate For someone you love.

In the past year sugar free & choco zoo both have been appriciated by consumers. y Competitors Cadbury, Nestle Reasons of failures
y

Lack of e-selling awareness- Amul Cyberstore y Poor advertising and less use of hoardings Competition Scenario y The chocolate market in India has only 3 big players, Cadbury (79%), Nestle (14%) & Amul (5%).
y

Suggestionsy Amul must come up with its own boutiques y Form its own shelves in retail shops & take ownership of maintaining them. y Direct school programmes

Amul Chocolate
Low Growth Phase Inadequate success
Failed new brands Tough Competition by Market LeadersCadbury(70%), Nestle

Decline Sales

1974 1985 1999 2002 2009

Years

Decline Sales

New Brands
Kite Bite Nutes about you Sugar free Choco Zoo

Introduction Phase
Amul milk Amul fruit & nut

What more can Amul do ?

I. II.

III.

To improve further Amul can try following ideas Amul can venture out on new products like Toned milk, condensed milk that can be used for sweets, baby food products. There are certain products like Amul basundi, gulab jamoon, chocolates etc which are not as popular as Amul Ice-cream. Amul must try to understand the cause of this through market research & work on improving these products. Though Amuls hoardings are a huge success, It can penetrate even better in the rural areas by advertising through the media via cable channel s and newspapers sponsoring shows in TV, sports events can be great help.


Conclusion
y

As Amul has large number of product variety, they can focus on each criteria on each market segment. The most effective dimension would be a product differentiation among place wise. As of now there is no such company which made product variety in such segment.