AMUL CHOCOLATES

Anmol Vaish (05) Arun Hariharan (08) Arun Aggarwal (13) Amruta Gandhe (16) Divya Gupta (18)

Amul
One of the largest dairy Co-operatives Began its journey from the year 1946 Initiated the start of white revolution in India Amul has ensured that India be one of the largest milk producing nation

Mission and Vision

Spread White revolution in India To improve life of farmers by creating the largest ever co-operative dairy To provide quality products to our customers To make milk available to every corner of the country

Purpose of the Plan(Amul Chocolates)

To revive the position of Amul chocolates in the market To chalk out a plan for increasing market share of Amul To put a plan for increasing the visibility of Amul chocolates among customers Increasing the market share of Amul from 5% which is negligible

Current Products

Target Market
Amul has decided to segment the market with brands catering to the `impulse' and `teen' segments, as well as having brands catering to different occasions. Chocozoo - Kids Bindas and Fruit and Nut - teenagers Cooking Chocolate - housewives, caterers, bakeries, restaurants, biscuit manufacturers, ice-cream parlours, and confectioners Occasion-related sub-brands - Kite Bite and Nuts 'bout U brand

Distribution Network
Amul, reaches out to over five lakh retail outlets, has over 2,600 distributors under its fold. Direct retailing through "Amul Utterly Delicious" parlours created in major cities Ahmedabad, Bangalore, Baroda, Delhi, Mumbai, Hyderabad and Surat. Plans to create a large chain of such outlets to be managed by franchisees throughout the country Amul does e-selling of all its products including chocolates.

Current Competitors
The chocolate market in India has 3 big players Cadbury, Nestle and Amul. New brands like Sweet World, Candico and Chocolatiers are present in several malls. Delhi-based Chocolatiers, has ventured into malls and multiplexes in NCR, Mumbai and Bangalore with a focus on high-end designer chocolates. Candico India is aiming for 400 locations across malls and multiplexes in the city by 2010.

Cadbury Chocolate sales of Rs 514.03 Crore Market leader by far 79% share Product range includes Eclairs, 5 Star, Dairy Milk, Fruit and Nut, Celebration, Rich Chocolates Nestle Chocolate sales 346.51 Rs. Crore 14% market share Chocolates 13-15% of total revenue Product range includes Classic, kit Kat, Munch, Choco stik, Bar one

 Good product range Good quality and packaging Excellent distribution network Branding and advertising Pricing is good

Limited international presence . Penetration in rural areas is still limited

Strengths

Weakness

Opportunities
Tie-ups with hotel chains, restaurants Special occasion packages Global expansion and more rural penetration

Threats

Local sweet dishes Entry of other local or international brands

Micheal Porters Five Forces Model

MARKET SEGMENTATION & TARGETING

Customer based market segmentation - Kids & Youth Industry based market segmentation - Bakery & Confectionaries Market share : 10%
Market Position : 3

MARKETING MIX
PRODUCT: Quality & Reliability (USP)

PLACE

TARGET MARKET
PRICE: Affordable, Competition based pricing ( E.g Choco Crunch)

PROMOTION

Promotion
1970s Market Leader A classic 1970 - 80 Advertisement

 Shifted focus in 1990s towards other milk products. Competition from multinationals

1990s

Market share down to 2-3%

Introduced newer varieties of chocolates, like Bindas, Nuts About You and others, targeting teenagers

2003....
Increase in sales due to cadbury worm controversy.(20 % increase in sales)
To boost sales, Amul launched three new chocolates in under the brands Fundoo, Bindaas and Almond Bar While the first two have been priced at Rs 10 for a 30 gm stick, Almond Bar carries a price tag of Rs 10 for a 35 gm chocolate As a result, AMUL's festival season pack "Rejoice" came with six chocolates, up from three during the festive season before

2004-Repositioning
Launch of Chocozoo - chocolates in shapes of motorcycles, aeroplanes, animals and comic charaters .

Targeted Kids.
Introduced economic variants of chocolates priced at Re 1, Rs 3 and Rs 5. A tub of Chocozoo chocolates were priced at Rs 138 for 46 units of chocolates, but retailers can sell the chocolates loose, at Rs 3 each. This, was done to attract kids. A new tag line: Amul Chocolate For Someone You Love. Not merely gifts, but make a more emotional pitch with emphasis on Amul Chocolates for love on all occasions.

 Reworked its strategy in the chocolate category to push its chocolate product sale
Strategy was to identify the market gaps and try and fill them as done in the past with their sugar free and Choco Zoo, both of which have been appreciated by the consumers. Placed its chocolate products at lesser price points compared with its competitors. Launched Trix, a wafer biscuit coated with rich milk chocolate. Cadbury's Perk and Munch from Nestle are other two major players in the wafer chocolate segment. Priced at Rs 5, available in strawberry and chocolate flavours. Market share increased to 10 %

2007 Strategy Rework

Issue with Amul Chocolates

Amul chocolate's Market share decreased to 5% much less than market leader(79%) The awareness level of AMUL CHOCOLATE is very low. Performance of AMUL CHOCOLATE vis--vis other Brands. The consumer psyche has only 2 brands in mind Cadbury & Nestle

Advertisement
Amuls core focus has been Company branding. Advertisement of little girl is going from years and symbolises Amul But the advertisements for chocolates has not caught the mind and imagination of the people so far. Ads by Cadbury and Nestle has been very aggressive to attract the consumer base which has reduced visibility of Amul Chocolates

Promotion
Must choose a Brand ambassador ( Celebrity) eg; Mr. Amitabh Bachchan ADVERTISING Increase in frequency, At prime time. Must increase advertising expense from the current 1% of the revenue to 5-6% as done by other competitors

Place
Make use of its strong distribution structure. Target Malls apart from retail stores. Width and penetration should increase to rural areas.

Recommendation
Must introduce Festival Gift boxes like Cadbury Celebration. Visibility at retails points. To increase the visibility of its products, target areas near bus stops, colleges, schools, cafes and places of entertainment like theaters and amusement parks.

Chocolate Boutique
Amul must come up with its own chocolate boutiques. Form its own shelves in retail shops and take ownership of maintaining them. Providing the transparent boxes as provided by Cadbury

Marketing Budget
Members :13 District Cooperative Milk Producers' Unions No. of Producer Members :3.03 million No. of Village Societies :15,712 Total Milk handling capacity :13.67 million litres per day Milk collection (Total - 2010-11) :3.45 billion litres Milk collection :9.2 million litres (Daily Average 2010-11) Milk Drying Capacity : 647 Mts. per day Cattle feed manufacturing :3690 Mts per day Capacity Sales Turnover (2010-11) :Rs. 9774 Crores (US $ 2.2 billion)

Sales turnover
Year Sales Turnover(Rs in million)
22588 23365 27457 28941 29225 37736 42778 52554 67113 80053 97742

Sales turnover(USD in million)

500 500 575 616 672 850 1050 1325 1504 1700 2172

2000-01 2001-02
2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11

Chairmans speeches data

Sales turnover is $2.5 bn in 2012-13 as per Market share of Amul chocolates is 5% So Sales turnover of Amul chocolates is $0.125 bn Sales Promotion budget of Amul India is 2% Growth rate is 20% every year for last 5 years Forecasted Sales :$ 3 bn in 2013-14

Sales Promotion Budget

Sales Promotion Budget Item Description Approximate Cost/activity on a day Television 10 second TV Ad to be aired Rs.4,00,000 repetitively during films, comedies and soaps. Magazines Half page advertisements regularly Rs.45000 Newspapers Mixture of press releases and adverts Rs.60000 to be run in national newspapers for the duration of the campaign Outside Advertising Outdoor print displays including public transport and bill boards Rs.60000 Website Production, Hosting and maintenance of the websiteRs.50000

Conclusion
Amul has good revenues from its other dairy products. It can afford to spend heavy on the chocolate segment to revamp it Marketing budget presented gives the proper plan for the same Amul can increase its market share and give healthy competition to others