Amul India CaseStudy

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A m u l

W h i t e R e v o l u t i o n t o W h i t e L i e

Prepared for: Dr. Rohit Singh

Prepared by: Amiteshkumar Rajput, MBA 3rd

Semester, 6th

Block

Date: December 4, 2014

Proposal: Rural Marketing, AURO University, MBA


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1 | AURO University MBA Rural Marketing

Amul India: A Social Development Enterprise

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Gujarat Cooperative Milk Marketing Federation Ltd.(GCMMF) is India's largest

food product marketing organisation with annual turnover (2013-14) US$ 3.0 billion.

Its daily milk procurement is approx. 13.18 million lit per day from 17,025

village milk cooperative societies, 17 member unions covering 31 districts, and

3.23 million milk producer members.

It is the Apex organisation of the Dairy Cooperatives of Gujarat, popularly known as

'AMUL',which aims to provide remunerative returns to the farmers and also serve the

interest of consumers by providing quality products which are good value for money.Its success has not only been emulated in India but serves as a model for rest of the

World. It is exclusive marketing organisation of 'Amul' and 'Sagar' branded

products. It operates through 53 Sales Offices and has a dealer network of 10000

dealers and 10 lakh retailers, one of the largest such networks in India. Its product

range comprises milk, milk powder, health beverages, ghee, butter, cheese, Pizza

cheese,Ice-cream, Paneer, chocolates, and traditional Indian sweets, etc.

GCMMF is India's largest exporter of Dairy Products. It has been accorded a "Trading

House"status. Many of our products are available in USA, Gulf Countries,Singapore,

The Philippines, Japan, China and Australia. GCMMF has received the APEDA

Award from Government of India for Excellence in Dairy Product Exports for the last

13 years. For the year 2009-10, GCMMF has been awarded "Golden Trophy" for its

outstanding export performance and contribution in dairy products sector by APEDA.

In 2013-14, GCMMF took giant strides in expanding its presence in International

markets. Amuls presence on Global Dairy Trade (GDT) platform in which only the

top six dairy players of the world sell their products, has earned respect and

recognition across the world. By selling milk powders on GDT, GCMMF could not

only realize better prices as per market demand but it also firmly established Amul in

the league of top dairy players in world trade.


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For its consistent adherence to quality, customer focus and dependability, GCMMF

has received numerous awards and accolades over the years. It received the Rajiv

Gandhi National Quality Award in1999 in Best of All Category. In 2002 GCMMF

bagged India's Most Respected Company Award instituted by Business World. In

2003, it was awarded the The IMC Ramkrishna Bajaj National Quality Award - 2003

for adopting noteworthy quality management practices for logistics and procurement.

GCMMF is the first and only Indian organisation to win topmost International Dairy

Federation Marketing Award for probiotic ice cream launch in 2007. For the

innovations, GCMMF has received AIMA-RK Swamy High Performance brand

award 2013 and CNN-IBN Innovating for better tomorrow award in 2014. For the

tree plantation activity GCMMF has received seven consecutive Good Green

Governance award from Srishti during 2007 to 2013.

The Amul brand is not only a product, but also a movement. It is in one way, the

representation of the economic freedom of farmers. It has given farmers the courage

to dream. To hope. To live.

Synopsis of the Case Study

1. It all began when milk became a symbol of protest

2. Founded in 1946 to stop the exploitation by middlemen

3.

Inspired by the freedom movement

The seeds of this unusual saga were sown more than 65 years back in Anand, a small

town in the state of Gujarat in western India. The exploitative trade practices followed

by the local trade cartel triggered off the cooperative movement. Angered by unfair

and manipulative practices followed by the trade, the farmers of the district

approached the great Indian patriot Sardar Vallabhbhai Patel for a solution. He

advised them to get rid of middlemen and form their own co-operative, which would

have procurement, processing and marketing under their control.

In 1946, the farmers of this area went on a milk strike refusing to be cowed down by

the cartel. Under the inspiration of Sardar Patel, and the guidance of leaders like

Morarji Desai and Tribhuvandas Patel, they formed their own cooperative in 1946.


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This co-operative, the Kaira District Co-operative Milk Producers Union Ltd. began

with just two village dairy co-operative societies and 247 litres of milk and is today

better known as Amul Dairy. Amul grew from strength to strength thanks to the

inspired leadership of Tribhuvandas Patel, the founder Chairman and the committed

professionalism of Dr Verghese Kurien,who was entrusted the task of running the

dairy from 1950.

The then Prime Minister of India, Lal Bahadur Shastri decided that the same approach

should become the basis of a National Dairy Development policy. He understood that

the success of Amul could be attributed to four important factors. The farmers owned

the dairy, their elected representatives managed the village societies and the district

union, they employed professionals to operate the dairy and manage its business.

Most importantly, the co-operatives were sensitive to the needs of farmers and

responsive to their demands.

At his instance in 1965 the National Dairy Development Board was set up with the

basic objective of replicating the Amul model. Dr. Kurien was chosen to head the

institution as its Chairman and asked to replicate this model throughout the country.


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The Amul Model

The Amul Model of dairy development is a three-tiered structure with the dairy

cooperative societies at the village level federated under a milk union at the district


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level and a federation of member unions at the state level.

Marketing Mix of Amul

One of the most conservative FMCG entities, GCMMF spends a mere 1% of its

turnoveron promotions. GCMMF has written and re-written rules of the game. Amulbutter girl is one of the longest running ad campaigns in the country for 41 years.

Intelligent marketingof milk, ice cream and butter milk. Intelligent Marketing

Expansion to foreign shores GCMMF had signed an agreement with Wal-Mart

to stock its shelves with products under its Amul brand name. Amul processed

cheese, pure ghee, Shrikhand, Nutramul, Amul's Mithaee Gulab Jamuns are

few of the products marketed in the US markets. 50 per cent of Americansbeing medically obese, and if Amul is really looking to capture the hearts of


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the second- and third-generation Indians, offering low-fat versions of its

brands, would make a lot of commercial sense. Hence targeting the large

Indian community in the US markets with its niche products like mithai,

packaged ready to eat foods market it can definitely expand its market to a

large extent.

Moving consumers from loose milk to packaged milk and gradually move

them up the value chain (tetra pack to beverages) Being exposed to a brand, it

is natural for a customer to try more products Defense Strategy

Wide range of product categories caters to consumers across all market

segments. For example, Amul Kool is targeted at children, while teenagers

prefer Kool Caf, as it has a cool imagery associated with its segmentation.

Changing retail environment Striking out on its own, with Amul Outlets or

parlours to deliver consumers total brand experience Launched in 2002, there

are now over 4700 Amul parlours across the country, which contributed 3% to

the brands total turnover in year 2009.

Given this wide product portfolio, Amuls approach is to promote its brands in a

rotational cycle of two to three years. After ice-creams were launched in 1996, the

category was re-visited in 1999, in order to improve availability of the product

and make it affordable. The focus shifted to cheese in 2001, Amul Masti Chaas in

2004-05 (sales of Masti dahi grew by 25%), Nutramul and Kool Kafe in 2006 and

this year the focus is on Amul Kokocold chocolate drink Promotion. Uses a variety

of media to communicate Most famous is billboard campaign The endearing polka

dressed girl and pun at various issues increased brands fanfollowing.

Amul food festival, which has been held for the last four year between Octoberand

December in about 50,000 retail outlets. The Chef Of India contest invitespeople to

come up with recipes using as many Amul products as possible. The recipe can be

submitted on Amuls website. Slogan Likho Disneyland Dekho Contest Promotion

Amul Maharani contest: in this contest questions about Amul are asked


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Promotion. AMUL sponsored the Singing Competition AMUL Star Voice of India,

Amulmusic ka maha mukabla, Amul Master Chef Part I and II Promotion

Successful Product Startegy:

1.Product Positioning Strategy

- Low price Amul Ice

- Creams made Kwality walls life.

- Chocolate milk was launched!Amul Kool koko

2.Product Re-Positioning Strategy

- Jaldhara

-Narmada Neer

3.Product Overlap Strategy

-Amul Processed Cheese Vs Cheese Spread Nutramul

- Energy Drink Vs Amul Kool

4.Product Design Strategy

-Use of UtterlyButterly Girl since 1967

5. Product Elimination

- Eliminated Jaldhara

6.Diversification Strategy

- Dairy Products

E.g.: Fresh Milk, Milk Drinks & Desserts, and Bread Spreads, Cheese

Products NonDairy Products Egg: Veg. Oils, Snacks, Instant Food Successful

Product Strategy


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! PRODUCT ACCEPTABILITY

!

1. DAIRY PRODUCTS

2.

COOKING PRODUCTS

! PLACE AVAILABILITY

1.

RURAL AND URBAN MARKET

2.

INTERNATIONAL MARKET

! PRICE AFFORDABILITY

1. LOW PRICING STRATEGY

! PROMOTION AWARENESS

1. ADVERTISEMENT


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Amul is in the business of development, not just marketing a

developing process, be it process, people, process. The spirit of level

can be seen and felt in everything what they do.

The major issues for its success are as follows:

1. The conflicts between the farmer-members and professional members. As

each adopted a different perspective, and as their sophistication of

comprehension differs, these groups were unable to communicate

effectively.

2.

The conviction and leadership were what the founders portrayed, which

appeared to be absent in the current generation of professional managers.

3. As India progressed towards liberalization and globalization there were

policies that hampered the growth of Amul.

4. The liberalization process curtailed the decrease in the tariff structures,

which would not ensure an equal playing field for all dairy economies.

5. As white revolution was going under Dr. Kurien, the opponents did not

appreciate the manner in which he handled the expansion of the industry.

6.

The general belief was that milk grant would be better alternative, not

assuming the milk powder for sale. These plans were termed as WHITE

LIE.

7. The challenges from external environment were another threat to their

existence.

8. Amuls focus had been in developing managers, not leaders. This aspect

challenged the system, with limited innovation in their product line, systems

and processes.

9. The phase of transition in leadership is also affecting the success of Amul.

Transition in leadership affects whole functioning of the business. Amul is

experiencing this shift.

Documents

Amul India CaseStudy