sunfeast project

RETAILER PREFERENCE TOWARDS SUNFEAST BISCUITS

INTRODUCTION

Indian marketing is largely described as sellers market. Demand is invariably greater than supply.

Purchasing power of mass is limited. More than 30% of our population has income below the poverty

line. Bulk of our population resides in villages and markets have got to capitalize rural marketing

opportunity. The consumers are ignorant, illiterate, unorganized and hence they have weak bargaining

power. Most of our business enterprises are still having selling concepts, which is product, oriented

marketing approach. Bigger business houses having national market are adopting integrated corporate

planning sound market planning as well as strategic marketing planning have very limited scope of

present. A change is taking place is the marketing environment at a reasonable speed and money.

Consumer oriented marketing company are beginning to realize the pressure of competition and buyer

market.

Marketing are called upon to anticipate changes in the marketing environment involving

opportunities, risks and uncertainties. They are required to forecast the direction and intensity of these

future changes in the environment and secure favorable relationship with the changing environment. To

do this intelligent planning marketers need information. Accurate sales forecasting involves collection

and reliable sales forecast, marketing plans and programmes through organised information system, we

would have profitable marketing activities minimum risks and uncertainties.

The essence of modern marketing concepts is that all elements of business should be geared

towards the satisfaction of consumers. This requires a through understanding of consumer behaviours

and buying motives without such insights marketers will fail to segment market effectively and design

strategy for an effective penetration into the defined market segments.

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The adoption of the consumer forecasts in fact the real difference between the traditional

concept of selling and the modern concept of marketing. It is the enough for the marketing manager to

get suitable relations to the given wants of consumer in a of Business management study programme

preparation of the project report on a chosen topic is compulsory. To carry out this task I have

undertakes a detail survey of Retailer behaviour on Sunfeast Biscuits and Marketing performance an

market share of ITC Limited. A case has study has also be undertaken on Sunfeast Biscuits. Reference is

also been made to marketing of other Biscuits passive way. As a part with other competitive brands.

In the modern world the Biscuits have become so popular that it is deemed to be best and

appealing media of mass entertainment and even for education.

An attempt has been made in this project report to know the details regarding history,

fundamental concepts, marketing to biscuits and other details of biscuits. Attempt has also been present

marketing performance of Sunfeast biscuits and certain suggestions have also been given for promotion

of marketing activities by adopting suitable marketing strategy.

STATEMENT OF THE PROBLEM:

“A RETAILER PREFERENCE TOWARDS BISCUITS IN SHIMOGA CITY WITH SPECIAL REFERENCE TO

SUNFEAST” The motto behind the project work was to understand the retailers perception and

satisfaction level regarding the sunfeast biscuits and Britannia biscuits with special reference to the

retailers of Shimoga City and to review and re-investigates its activities in the market.

The opinion of the retailer with respect to any product and the services from the providers

varies based on their unique perceptions. For each individual, reality is totally personal phenomenon,

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based on that person’s needs, wants, values and personal experiences. Thus, to the marketer, retailer’s

perception and opinions are much more important than the knowledge of objective reality.

NEED OF THE STUDY:

The need of the retailers’ perception and satisfaction measurement arises along with the need

to satisfy the ITC product retailers and customers so that to keep them with the company. Ensuring

their satisfaction is vital to the ITC product distributors for long term business survival and profitability.

We need to understand and evaluate satisfaction levels of the sunfeast biscuits customers in

comparison with the Britannia biscuits. Perception surveys answer many tough questions, which help in

the growth of the confectionary sector. A well-designed satisfaction survey can give answer to the most

critical questions which are otherwise impossible to get solved and may get complicated upon course of

time and may increase the levels of the risks attached with the functioning of the enterprise in its

regular course of business.

The need for conducting this study was to measure retailers’ preferences, perceptions and

choices towards the biscuits of Sunfeast and Britannia and to know the factors affecting them.

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OBJECTIVES OF THE STUDY:

To study growth and performances of the confectionary industry.

To study retailer choices regarding biscuits of Sunfeast and Britannia.

To study preference regarding the Sunfeast biscuits.

To find out influencing factor for retailers preference to particular brand.

To find out what is the position of Sunfeast biscuits in comparison with Britannia biscuits.

SCOPE OF THE STUDY:

The scope of the study is broader than mere gauging retailers’ perception regarding Sunfeast

biscuits in comparison with the Britannia biscuits. It makes an effort to build and strengthen

relationships with the customers. It makes competition analysis as well as helps to knowing the

expectation of the retailers.

The study will help the wholesale distributors of Sunfeast biscuits to identify, which section need

to improve so that it can provide retailers and customers, the enhanced satisfaction. The study will also

help the management to decide which strategies are to be used to improve the satisfaction level among

the customers. The study was limited to Shimoga city within the constraints, time and sample size.

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LIMITATIONS OF THE STUDY:

All the possible key is the taken from the original source and makes the project has authentic as

possible. However, it is subject to the certain limitations. They are as under,

1. The information given by the respondents may or may not be true. Because in some cases

respondents may be casual they don’t give correct opinion while answering the questionnaire.

2. The views of the respondents cannot be taken as general view of general public to conclude and

prepare the project.

3. Due to limitations of the time, sample size is restricted to 100 respondents.

4. Retailers preferences change as per circumstances, where the information used in the project will

become invalid.

5. Market can bring about abrupt changes, which may lead to deterioration in the authenticity of the

surveyed project.

6. The qualitative research may have its own basis which again limits for broader undertakings.

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RESEARCH DESIGN:

To analyze the retailers perception for Sunfeast biscuits in comparison with the Britannia

biscuits. By simple random sampling method, 100 retailers are selected from different places of Shimoga

city to put forth their views and to fill the questionnaires.

The questionnaire is drafted to find out various motives, preferences and choices of retailers on

their Sunfeast and Britannia biscuits providers. The questionnaire covers demographic profiles of the

consumers and various attributes.

The questionnaire is collected after respondents fill them and simple percentage calculation is

drawn to findings and results.

SAMPLING METHOD:

1. Sampling design:

Research is designed for two sampling plans. It consists of three divisions.

i.e., sampling unit, sampling size and sampling procedure.

2 Sampling procedure:

Empirical field studies required collection of first hand information of data pertaining to the

study from the field. These units of study include geographic area of Shimoga city. The aggregate of the

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all the units pertaining the study is called the population or the universe. Population is the largest group

to be studied. It is the total collection of elements about which we wish to make inferences. A member

of population is an element. It is Subject on which measurement is taken. It is the unit of study, a part of

population is known as a sample. The process of drawing a sample from a larger population is called

sampling.

The list of sampling units from which a sample is taken is called the sampling frame. For the

present study purpose, simple random sampling has been selected. Simple random sample is used

because every elementary unit has got equal chance to be included in the sample.

3 Sample units:

This particular survey was directed at only those who are selling biscuits in Shimoga city.

4 Sampling plan:

Sampling techniques may be classified as non-probability and probability techniques. Non-

probability sampling techniques relay on the research judgments. Consequently, they do not permit an

objective evaluation of the precision of the sample results and estimates obtain are not statistically

project able to the population. The Commonly used non-probability sampling techniques include

convenience sampling, judgment of sampling quota sampling and snowball sampling.

In probability sampling techniques, sampling units are selected by chance. Each sampling unit

has a non-zero chance of being selected and the researcher can specify every potential sample of the

given size that could be drawn from the population, as well as the probability of selection each sample.

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It is also possible to determine the precession of sample estimates inferences make projections to the

target population.

Probability sampling techniques include simple random sampling, systematic sampling, stratified

sampling, cluster sampling, sequential sampling and double sampling.

The choice between probability and non-probability sampling should be based on the nature of

the research, degree of error tolerance, relative magnitude of sampling non-sampling errors, variability

in the population and statistical, operational considerations.

5 Sample size:

The sample size is of 100 respondents consisting of retailers selling biscuits in Shimoga city.

SOURCES OF DATA:

Data are facts, figures and other relevant materials, past and present, serving as basic study and

analysis.

The data serves as the bases for analysis. Without an analysis of actual data on specific

inferences can be drawn on the question under study. Inferences based on imagination or guess work

cannot provide correct answers to research questions. The relevance, adequacy and reliability of data

determine of quality of findings of a study.

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For the purpose of present study data from two sources have been gathered namely primary

and secondary data.

1 Primary data:

Primary data are original data collected for the purpose of a particular study. In the present

study primary data have been collected by personal interview method with the help of questionnaire.

2 Secondary data:

These are the sources containing data, which have already been collected and compiled for

other purpose by other researchers. The secondary sources consist of readily available materials and

already compiled statistical statements and reports whose data may be used by researcher for his / her

studies.

Secondary data for the present research collected the major sources of secondary data are given

below.

Cygnus reports

Business line

Various websites

Different marketing journals

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The primary data are those data collected a fresh and for the first time and thus happen to be

original in character.

The secondary data on the other hand, are those, which have already being collected by

someone else and which have already been passed through the statistical process. The methods of

collecting primary and secondary data differ. Since primary data are to be originally collected, while in

case of secondary data in the nature of data collection work is merely that of compilation. So, primary

data has been gathered for the purpose of the study employing all the above methods. Secondary data

has been gathered from various published sources, the same has been given in detail in Bibliography.

TOOLS AND TECHNIQUES OF DATA COLLECTION:

The researcher has adopted the questionnaire as the data collection tool by means of extensive

survey on selected respondents of adequate sample size. The researcher has taken utmost care to see

that the degree of bias is kept to the minimum by avoiding the ambiguity in the questions and while

recording the responses from the interviewed respondents to come out with a meaningful data

collection pattern, which facilitates the effective analysis and interpretation of the collected data to

come out with fruitful and worthwhile conclusions and to put forward significant conclusion for the

company to implement the same in order to have a competitive edge over the rest of the competitors in

the market place.

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COMPANY PROFILE

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ITC PROFILE:

ITC is one of India's foremost private sector companies with a market capitalization of

nearly US $ 18 billion and a turnover of over US $ 5.1 Billion. ITC is rated among the World's

Best Big Companies, Asia's 'Feb. 50' and the World's Most Reputable Companies by Forbes

magazine, among India's Most Respected Companies by Business World and among India's

Most Valuable Companies by Business Today. ITC also ranks among India's top 10 `Most

Valuable (Company) Brands', in a study conducted by Brand Finance and published by the

Economic Times.

Take an abiding commitment to world-class quality. Add deep market insight; cutting-edge

technology; a pervasive culture of innovation. And you have ITC brands that do India proud across a

range of products and services: Aashirvaad, Sunfeast, Kitchens of India, mint-o, Candyman, Wills

Lifestyle, John Players, ITC-Welcome group, Expressions, Classmate, Paperkraft, Elemental Chlorine-Free

Cyber XLPac, Aim, iKno, Mangaldeep. The list goes on.

Even as its brands delight consumers and enrich their quality of life, ITC continues to be

powered by its aspiration to make a larger contribution to national imperatives like empowering

farmers, greening wastelands, irrigating dry lands, nurturing small scale enterprises, empowering village

women and supporting rural education. Because our people and our country deserve the best.

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Business of ITC

During the June, 07 quarter, a 12.5% value added tax was levied on cigarettes, which is expected

to depress the volume. Since ITC is a dominant player, it has the pricing power to compensate for any

fall in volumes. To maintain its dominant position in the tobacco business in the face of the rising

competition, ITC has announced plans to invest around Rs.1000 million in the cigarette business.

However, its non tobacco business is increasing and acquiring greater significance as the

company is betting huge sums on new business. In FY07, the cigarette business accounted for around

half of the ITC consolidated revenues but only 37% of its capital expenditure. Not surprisingly, its non-

tobacco business is growing faster. In FY07, its non cigarette business grew 32% against 14% growth in

the tobacco business. Most importantly, profit before tax from non tobacco business was up 34%

against 17% growth of its tobacco business. This was achieved despite continued losses reported by non

tobacco FMCG business. In the June quarter, revenues from non tobacco business grew 7% mainly, on

account of a decline in the profitability of paper and paper board business.

ITC is using its strength in rural sourcing network and brand building to acquire industry

leadership in branded staples, ready to eat, hospitality and life style apparel segments. In the short run,

it has depressed it consolidated margins and returns on capital, but many of these businesses may now

start yielding results. It now plans to expand its branded packaged food portfolio by launching more

products for which it has stepped up research and development spend.

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ITC is also expanding its hotel business and started rebranding exercise to maintain its premium

status as many international chains are planning to foray into India. It is adding around 770 rooms and

100 service apartments in Bangalore and Chennai. Its paper business provides packaging solutions to its

other businesses. It is also expanding in the paper business to tap Indian paper growing market. It is

doubling its pulp capacity and adding new paperboard machines. This will raise its paper and paper

board capacity by around 37% to 4.5 lakh tones.

NATURE OF BUSINESS CARRIED:

FMCG

HOTELS

PAPERBOARDS & PACKGING

AGRI - BUSINESS

GROUP COMPANIES

FMCG:

CIGARETTES:

ITC is the market leader in cigarettes in India. With its wide range of invaluable brands, it has a

leadership position in every segment of the market. It’s highly popular portfolio of brands includes India

Kings, Gold Flake, Navy Cut, Scissors, Capstan, Berkeley and Bristol.

ITC's leadership is founded on its core strategy of continuously enhancing product

values through significant investments in product design, manufacturing technology, quality,

marketing and distribution. In just the last 5 years, ITC has made capital investments of over Rs.

7 billion in its cigarettes business. In ITC, one of the pioneers of market research in India, the

consumer is still the King. The Company continuously endeavors to provide its consumers

products that are benchmarked to international quality. This strategic focus on the consumer

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has paid ITC handsome dividends. The most important of these is its enriched product mix,

unmatched by competition. ITC's share of filter cigarettes in the country is more than 70%.

In pursuit of international competitiveness, ITC has launched four brands - Checkers, Hi-

Val, Royale Classic and Gold Crest - in the extremely competitive US market. Recently ITC has

launched Royale Classic, Gold Cut and Scissors Filter Kings cigarettes in the Middle East. The

response to these brands has been encouraging. ITC's cigarettes are produced in its state-of-

the-art factories at Bangalore, Munger, Saharanpur and Kolkata. These factories are known for

their high levels of productivity and very contemporary work environment.

ITC's FMCG businesses have one of the largest retail networks in the country, consisting

of over 2 million retailers. Its reach covers a wide range of the retail spectrum, from premium

outlets in the metros to small shops in the interiors of rural India.

FOODS:

ITC made its entry into the branded & packaged Foods business in August 2001 with the launch

of the “Kitchens of India” brand. A more broad-based entry has been made since June 2002 with brand

launches in the Confectionery, Staples and Snack Foods segments. The packaged foods business is an

ideal avenue to leverage ITC's proven strengths in the areas of hospitality and branded cuisine,

contemporary packaging and sourcing of agricultural commodities. ITC's world famous restaurants like

the ‘Bukhara’ and the ‘Dum Pukht’, nurtured by the Company's Hotels business, demonstrate that ITC

has a deep understanding of the Indian palate and the expertise required to translate this knowledge

into delightful dining experiences for the consumer.

ITC has stood for quality products for over 90 years to the Indian consumer and several of its

brands are today internationally benchmarked for quality.

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http://www.kitchensofindia.com/


The Foods business carries forward this proud tradition to deliver quality food products

to the consumer. All products of ITC's Foods business available in the market today have been

crafted based on consumer insights developed through extensive market research. Apart from

the current portfolio of products, several new and innovative products are under development

in ITC's state-of-the-art Product Development facility located at Bangalore.

Leadership in the Foods business requires a keen understanding of the supply chain for

agricultural produce. ITC has over the last 90 years established a very close business

relationship with the farming community in India and is currently in the process of enhancing

the Indian farmer's ability to link to global markets, through the e-Choupal initiative, and

produce the quality demanded by its customers. This long-standing relationship is being

leveraged in sourcing best quality agricultural produce for ITC's Foods business.

The Foods business is today represented in 4 categories in the market. These are:

Ready To Eat Foods

Staples

Confectionery

Snack Foods

In order to assure consumers of the highest standards of food safety and hygiene, ITC is

engaged in assisting outsourced manufacturers in implementing world-class hygiene standards

through HACCP certification. The unwavering commitment to internationally benchmarked

quality standards enabled ITC to rapidly gain market standing in its entire 5 brand

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http://www.itcportal.com/agri_exports/e-choupal_new.htm


Sunfeast

In 2003, ITC forayed into the Biscuits market with the Sunfeast range of Glucose, Marie and

Cream Biscuits. Sun feast’s brand essence, "Spread the Smile" connotes happiness, contentment,

satisfaction and pleasure. The mascot Sunny reinforces the emotional aspects of the brand.

Sunfeast immediately established itself as a provider of innovative and distinctive products -

Sunfeast Marie was launched in an innovative orange flavor and the 'Sunfeast Dream Cream' range

includes new flavors as well as flavor enhancers. The Sunfeast Dream Cream range is currently available

in 8 variants.

The Company has also introduced 'Sunfeast Dark Fantasy', a dark chocolate and vanilla cream

offering for the premium segment in select markets. Riding on the success of its initial offerings, ITC also

entered the milk biscuit category with Sunfeast Milky Magic biscuits. Apart from milk which helps

mental growth, these biscuits also contain the finest quality wheat aiding physical growth.

In the last two years, the Sunfeast biscuits portfolio has been enhanced to include salted

crackers and cookies. The 'Sunfeast Snacky salted crackers are available in 2 unique variants – ‘Chilli

Flakes’ and ‘Classic Salted’. Sun feast’s latest offering, 'Sunfeast Special' biscuits are also available in

select markets. The Sunfeast Special range currently includes cookies in two variants – Butter and

Cashew, as well as cream biscuits in two variants – Choco and Orange. The Sunfeast product portfolio

has been further expanded to include healthy snacking options. 'Sunfeast Pasta Treat' is whole wheat

based instant pasta for children. After the tremendous success of the 4 initial flavours, the instant Pasta

range has been extended with two new exciting flavours – ‘Pizza’ and ‘Chicken’. The pasta segment was

further expanded with the launch of 'Sunfeast Benne Vita' in 4 innovative variants.

STRATEGIES OF ITC:

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ITC is a board-managed professional company, committed to creating enduring value for

the shareholder and for the nation. It has a rich organizational culture rooted in its core values

of respect for people and belief in empowerment. Its philosophy of all-round value creation is

backed by strong corporate governance policies and systems.

ITC’s corporate strategies are:

Create multiple drivers of growth by developing a portfolio of world class businesses that

best matches organizational capability with opportunities in domestic and export markets.

Continue to focus on the chosen portfolio of FMCG, Hotels, Paper, Paperboards &

Packaging, Agri Business and Information Technology.

Benchmark the health of each business comprehensively across the criteria of Market

Standing, Profitability and Internal Vitality.

Ensure that each of its businesses is world class and internationally competitive.

Enhance the competitive power of the portfolio through synergies derived by blending the

diverse skills and capabilities residing in ITC are various businesses.

Create distributed leadership within the organization by nurturing talented and focused

top management teams for each of the businesses.

Continuously strengthen and refine Corporate Governance processes and systems to catalyses the

entrepreneurial energies of management by striking the golden balance between executive freedom

and the need for effective control and accountability.

FUTURE PROSPECTS OF ITC:

It is estimated that the company’s sales will grow at the rate of 14% in JAS08 and it is estimated to

grow at the rate of 18% and 31% in terms of sales in next two years.

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MARKETING PROBLEMS FACED BY THE ITC & DEALER:

The main problems faced by the company & the dealer while marketing are as follows;

The ITC products are facing a tough competition from other Indian & Foreign Companies.

The tax levied by the govt. is high.

As there are number of different companies products available in market, consumer

will not stick to particular brand.

If there is no proper channel of distribution, the sales may come down.

If there is shortage of supply, consumers may opt other company products.

The lack of sales promotion affects the market share.

The major problem for the decrease in sales is that of smuggling.

ORGANISATION STRUCTURE

PROPRITOR AND PARTNERS

MANAGER

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INDUSTRY PROFILE

SALES MANAGER

SUPERVISIOR

SALESMAN

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In Indian Fast moving consumer goods (FMCG) sector is the fourth largest in the economy and

has a market size in excess of US$16.1billion. At present, Urban India account for 66% of total FMCG

consumption, and rural India accounts for the remaining 34%. However, rural India account for more

than 40% of the consumption

In personal care, fabric care and hot beverages. Around 70% of the total house holds is

expected to rise in 135m in 2001-02 to 153m in 2009-10. This presents the largest potential market in

the world.

FDI flow in the FMCG sector can create more revenue for the sector. It has been predicted that

the FMCG market will reach to US$33.4billion in 2015.The middle class and the rural segments of he

Indian population are the most promising market for FMCG, and give brand market the opportunity to

convert them to branded products. Most of the product categories like jams, toothpaste, skincare and

shampoos, in India, have low per capita consumption as well as low penetration level, but the potential

for growth is huge.

Lower and middle income groups account for over 60% of total FMCG sales. Rural market

account for 56% of the total FMCG. Unlike the perception that the FMCG sector is the producer of luxury

items targeted at the elite, in reality, the sector meets the everyday needs of the masses.

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OVERALL PERFORMANCE OF FMCG INDUSTRY IN JAS08:

According to the Cygnus estimates, the FMCG sector is expected to post strong revenue growth

of 26% JASO8 as compared to JASO7. The estimated aggregate net sales for the FMCG sector comprising

of to player in the sector in around Rs.146.29 billion in JAS08. It is estimated that there would be rise in

terms of growth in the operating and net profit for the quarter JAS08 in comparison with operating

profit is estimated to rise by 18.36 % and net profit by 13.02% in JAS08 in comparison with JASO7 &

there will be fall in packing cost by 10.95%, staff cost by 4.72% selling expenses., and other expenditures

will increase by 36.70%. Tax related cost will go up by 2.11%.

SCOPE OF THE SECTOR:

The Indian FMCG sector with a market size of US$13.1 billion is the fourth largest sector in the

economy. A well-established distribution network, intense competition between the organized and

unorganized segments characterizes the sector. FMCG Sector is expected to grow by over 60% by 2010.

That will translate into an annual growth of 10% over a 5-year period. It has been estimated that FMCG

sector will rise from around Rs. 56,500 crores in 2005 to Rs.92, 100 crores in 2010. Hair care, household

care, male grooming, female hygiene, and the chocolates and confectionery categories are estimated to

be the fastest growing segments, says an HSBC report. Though the sector witnessed a slower growth in

2002-2004, it has been able to make a fine recovery since then.

For example, Hindustan Levers Limited (HLL) has shown a healthy growth in the last quarter. An

estimated double-digit growth over the next few years shows that the good times are likely to continue.

GROWTH PROSPECTS:

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With the presence of 12.2% of the world population in the villages of India, the Indian rural

FMCG market is something no one can overlook. Increased focus on farm sector will boost rural

incomes, hence providing better growth prospects to the FMCG companies. Better infrastructure

facilities will improve their supply chain. FMCG sector is also likely to benefit from growing demand in

the market. Because of the low per capita consumption for almost all the products in the country, FMCG

companies have immense possibilities for growth. And if the companies are able to change the mindset

of the consumers, i.e. if they are able to take the consumers to branded products and offer new

generation products, they would be able to generate higher growth in the near future.

It is expected that the rural income will rise in 2007, boosting purchasing power in the

countryside. However, the demand in urban areas would be the key growth driver over the long term.

Also, increase in the urban population, along with increase in income levels and the availability of new

categories, would help the urban areas maintain their position in terms of consumption. At present,

urban India accounts for 66% of total FMCG consumption, with rural India accounting for the remaining

34%. However, rural India accounts for more than 40% consumption in major FMCG categories such as

personal care, fabric care, and hot beverages.

In urban areas, home and personal care category, including skin care, household care and

feminine hygiene, will keep growing at relatively attractive rates. Within the foods segment, it is

estimated that processed foods, bakery, and dairy are long-term growth categories in both rural and

urban areas. Indian Competitiveness and Comparison with the World Markets

THE FOLLOWING FACTORS MAKE INDIA A COMPETITIVE PLAYER IN FMCG SECTOR:

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Availability of raw materials Because of the diverse agro-climatic conditions in India, there is a

large raw material base suitable for food processing industries. India is the largest producer of livestock,

milk, sugarcane, coconut, spices and cashew and is the second largest producer of rice, wheat and fruits

&vegetables. India also produces caustic soda and soda ash, which are required for the production of

soaps and detergents. The availability of these raw materials gives India the location advantage.

Labor cost comparison

Low cost labor gives India a competitive advantage. India's labor cost is amongst the lowest in

the world, after China & Indonesia. Low labor costs give the advantage of low cost of production. Many

MNC's have established their plants in India to outsource for domestic and export markets. Presence

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across value chain Indian companies have their presence across the value chain of FMCG sector, right

from the supply of raw materials to packaged goods in the food-processing sector. This brings India a

more cost competitive advantage. For example, Amul supplies milk as well as dairy products like cheese,

butter, etc.

INDIAN CONFECTIONARY INDUSTRY:

The confectionery market consists of chocolate, gum, cereal bars and sugar confectionery.

Confectionery in India to 2006 is a detailed analysis of the confectionery market, providing forecast data

to 2006. The report examines key local trends in confectionery, with an emphasis on providing quality

primary research data, obtained directly from major players in the industry. It establishes the market

size and structure, provides analysis of current market trends, and profiles the industry’s major players.

Contains information on four confectionery categories - chocolate confectionery, sugar confectionery,

gum and cereal bars. The comprehensive data set includes market values, volumes, segmentations and

forecasts. All data is for 2001 and full five-year forecasts are provided. The Indian confectionery market

reached a value of $433.5 million in 2001. Sugar confectionery is the largest product category. It will

remain the most lucrative category over the next five years. These products are most suited to the

Indian climate. Chocolate and gum confectionery follow this, each with a similar sized share of the

Indian market. Standard grocers are the leading distribution channel, with one third of the Indian

confectionery market, by value. Traditional grocers are the only other channel to take a double-digit

share. The remainder of the market shows a high degree of fragmentation. Use this report to

understand the key trends and issues in confectionery and assess the competitive landscape of the

Indian confectionery industry.

INDIAN CONSUMER CLASS:

India has a population of over 1 billion and 4 climatic zones. Several religious and personal

beliefs, 15 official languages, different social customs and food habits characterize Indian consumer

class. Besides, India is also different in culture if compared with other Asian countries. Therefore, India

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has high distinctiveness in demand and the companies in India can get lot of market opportunities for

various classes of consumers. Consumer goods marketers’ experience that dealing with India is like

dealing with many small markets at the same time. Indian consumer goods market is expected to reach

$400 billion by 2010. India has the youngest population amongst the major countries. There are a lot of

young people in India in different income categories.

Top Ten Players in FMCG companies:

S. NO. Companies

1. Hindustan Unilever Ltd.

2. ITC (International Trading Company)

3. Nestlé India

4. GCMMF (AMUL)

5. Daub India

6. Asian Paints (India)

7. Cadbury India

8 Britannia Industries

9. Procter & Gamble Hygiene and Health Care

10. Marico Industries

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CONSUMER BEHAVIOUR

The term consumer is a person who buys goods or services for his own consumption on the

other hand buyer is a person who purchases goods either for resale or for use in production. Hence

these two terms are not same.

Customer behaviour has got the importance in a consumer or market oriented, marketing pouring

management. The study of consumer behaviour is as attempt to understand what consumers really

want and why they want it. The subject of buyer behaviour is new discipline in marketing. Therefore, the

marketing management must be finding out the various factors that influences the buying decisions of

the consumers.

Consumer behaviour means, is all psychological, social and physical behaviour of potential customers

as they became aware of evaluate purchase, consumer and tell others about products and services.

CHARACTERISTIC OF CONSUMERS BEHAVIOUR :

1. Consumer behaviour comprises mental and physical activities of a buyer. When he want to buy

goods and services to satisfy his needs.

2. It includes both visible and invisible of a buyer.

3. The behaviour of a buyer is very complex and dynamic. His behaviour changes constantly which

force to management to adjust his marketing mix with such changes.

4. The behaviour of an individual buyer is influenced by internal and external factors.

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DETERMINENTS OF CONSUMER BEHAVIOUR:

The buyer behaviour is influenced by several factors and forces. They are.

1. Psychological Factors

2. Social Cultural Factors

3. Economic Factor

4. Environmental Factor of buyer behaviour

1. PSYCHOLOGICAL FACTOR:

The behaviour of a consumer is influenced by the psychological factor such as:

1. Motivation

2. Perception

3. Learning

4. Belief and attitudes

5. Personality and self concept

MOTIVATION:

It is the underlying force of any human activity it is the psychological technique of inspiring

human being to act in a particular way according to the desire of the agent or motivators under

marketing motivation is a driving force that impels an individual to take action in order to satisfy his

needs. In fact, it is a mental phenomenon effected by perceptions, attitude and personality trait,

Motivation refer to the wishes or desires that initiates the sequence of events known as behaviour.

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PERCEPTION:

A motivated person is influenced by his perception of the situation. The consumer learns through

information out of five senses namely sight, hearing, smell, touch and taste. However consumer

perceives, organizes and interprets the information to forms a meaningful picture of the word is called

perception. However people can form different perception of the same stimulus because of three

percept ional process;

1. Selective exposure

2. Selective distortion

3. Selective retention

LEARNING:

Learning explains the changes in the behaviour of an individual arising from previous experience,

learning is the product of reasoning, thinking, information processing and perception because of their

learning experience, and the behaviour of a buyer is affected. Thus learning accurse through the inter

play of drives, stimuli, cues, responses and reinforcement.

The importance of learning theory is that the marketing managers can build a demand for their

product by associating with it strong drives, Cues and reinforcement. A new firm can enter the market

by appealing to the same drives as its rivals by providing similar cues or even better cues to attract

buyers.

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BELIEF AND ATTITUDE:

Most of the people their belief and attitude through acting and learning which influences their

buying behaviour. Beliefs refer to a descriptive through whom a person has about something, A buyer

called ‘X’ may believe that ‘Samsung’ product are superior reasonable price, high quality etc…., This

knowledge opinion or faith may tries to believe Samsung product may to buy it. However it may not

carry emotional change. For instance, the consumer beliefs that Samsung product are delicate may not

matter for then to their decision on buying it.

An attitude explains person’s consistent evaluations, feelings and tendencies towards an object

or idea. Psychologists have defined attitude as, an emotionalized inclination to respond positively or

negatively to an object or a class of objects.

PERSONALITY AND SELF-CONCEPT:

Personality of an individual refers to his personal qualities that determinate his behaviour

personality is made up of such personal traits like dominance, adventurousness, friendly now,

sociability, responsibility, aggressiveness, independence, competitiveness, self-consciousness,

exhibitionistic etc…….., which indicate how people behave success himself and how he believes other to

success him at a particular time. Self concept as three parts that is what you would like to be, how you

think others see you, your own concept of what you are like.

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2. SOCIAL CULTURAL FACTOR:

The buying of a consumer is shaped by social cultural factors like;

1. Family

2. Reference group

3. Social class

4. Culture

5. Occupation

1. FAMILY:

The behaviour of a buyer is influenced by the members of the family. The tastes, likes, dislike and

life styles of the family members arise through family buying behaviour.

The family influences on the buying behaviour of a member found in two ways

1. Family influences on the individual personality characteristics.

2. It influences on the decision taking process.

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2. REFERENCE GROUP:

The behaviour of a buyer is also influenced by many small groups which or directly or indirectly

influences on his behaviour. These groups may be friends, neighbours relative, co-workers close

associates etc;

3. SOCIAL CLASS:

Every society consists of some form of social class structure. Social class is relatively a permanent

and ordered division in a society where numbers share similar value, interest and behaviour. The social

class is determined by various factors such as income, occupation, education, properly, life styles and

consumption patterns etc..,

The three Social classes in India are upper class, middle class and lower class. The mentality of the

rich class is such that they give priority for high quality and expensive products where as the middle class

always analyze and collect information before buying. The lower class for which quality is secondary and

importance for quality at less price.

4. CULTURE:

Culture is a way of it is distinctive form of environmental adoption. It consists of a unique set of

learned beliefs, values, attitudes, customs, habits, dress, philosophy, traditions etc…, and forms of

behaviour shared by the people in the people in the society and it is transmitted from generation to

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generation. Culture is not state but always changing snd influences the pattern of consumption and

decision-making.

5. OCCUPATION:

The consumption pattern of a buyer also varies according to their profession or occupation. The

buying habits of doctor may vary to that of a lower or teacher. Hence the marketing manger should

concentrate their activities based on the occupation.

3) ECONOMIC DETERMINENTS:

The behaviour of the consumer is largely influenced by the economic factors like;

1. Personal Income

2. Family Income

3. Income Expectation

4. Consumer Credit

1. PERSONAL INCOME:

The personal income is an individual of an individual is an important determinant of gross

income consists of disposable income and discretionary income. The income which remains at disposal

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of an individual after deducting several items. Discretionary income refers to the balance remaining

after meeting basic necessities of life.

2. FAMILY INCOME:

It is the income of all the members of the family. The surplus family income is made available for

buying durables, shaping goods and luxuries. The size and life of the family will also have impact on the

buying behaviour of the family.

3. INCOME EXPECTATION:

It is another determinant. If the expectation of an individual about his income is more, he is tempted

to buy durable and luxuries. If his expectation is less on income, he will not go for luxuries.

4 . CONSUMER CREDIT:

Consumer credit means availability of credit facilities increases the buying habits of an

individual. If a person gets easy credit he will buy the durable on instalment and vice-versa. Likewise

savings and liquid assets are also the economic determinations of consumer behaviour.

5. ENVIORNMENTAL FACTORS:

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This factor is political system, legal, technological and ethical forces which influences the buying

behaviour of the consumers.

POLITICAL SYSTEMS:

The system of politics has an impact on the consumption pattern. In a controlled economic stage, that

consumption pattern is determined by the Government. But in a free capitalistic economy, consumers

enjoy wider choice and free to spend their income.

LEGAL FORMLITIES:

More the legal like stamp duty, customs duty etc.., Consumers are interested in fair and lawful

dealing on the other hand, if legal restrictions are less, the expenditure of consumer is more.

TECHNOLOGICAL FORCE:

The development of technology encourages consumers spend more on up to date and sophisticated

goods against absolute and outdated goods.

CUSTOMER RELATIONSHIP MANAGEMENT

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CRM has been defined in a variety of different ways. For some, CRM is a way to identify, acquire,

and retain customers. For others, it is a way of automating the front office functions of sales, marketing,

and customer service. For some vendors, whatever their current product may be, that is CRM.

This diversity of definitions is a result of differences in perspectives. The first is based on a

business perspective of increasing competition that is driving companies to focus on their customers.

The second is based on the relatively new phenomenon of the integration of previously separate

applications such as Sales Force Automation and Customer Service Support into Enterprise Applications.

The third is a result of software vendors re-positioning their information technology product and

services under the CRM umbrella, to take advantage of the fast growth of the CRM market. For the

purposes of this paper, we propose the following definition: CRM is a technology-enabled business

strategy whereby companies leverage increased customer knowledge to build profitable relationships

based on optimising value delivered to and realised from their customers.

The proposed framework is closely aligned with this definition and clearly emphasizes the links

between customer knowledge and increased profits. The definition also makes it clear that CRM is in

fact about crating value for customers. CRM itself is a not a technology, even though technology is

required to enable CRM. Technology makes it possible to integrate the large volumes of customer

information that are required for CRM, and to efficiently transform this information into useful

knowledge. Technology also enables a company to interest with its customer, as well as makes it easier

for the customer to do business with them.

However, leveraging this customer knowledge to make better business decisions and to be

responsive to customers, remains the responsibility of individual managers and workers at all levels

within the company. The most obvious question for most companies is why they have to use CRM. The

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bottom line is to optimise profitability. In addition to this, there are other long-term objectives that a

company should constantly try to achieve.

The importance of CRM

CRM is important because of the changes occurring in the competitive environment. Globalization

and the Internet mean that competition can now come as easily from around the world as from around

the corner. Power and choice are moving to the customer as never before and leading to the

commoditization of products and services in most situations.

In this environment, product quality and features are a given, and in many industries are now

so undifferentiated as to provide no significant competitive advantage. As a company, you must choose\

whether to compete on the basis of price in a cut-throat commodity market or on the basis of customer

relationships created through a superior value proposition. This second approach is what CRM is all

about. It helps you to sense ever more precisely the needs of your customers, and to respond to those

needs with highly targeted offering and marketing messages.

Fundamental Concepts

The Strategic CRM Framework is based on a number of concepts about today’s marketplace:

Changing Customer Expectation;

The Nature of the Customer Relationship; and

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The Difference between Loyalty and Captivity

Changing Customer Expectations

A CRM strategy is not just about implementing “point solutions” such as a Sales Force Automation

system, or setting up a web site. It is about evolving a business along a number of dimensions: From

being focused on making and selling products to sensing customer needs and responding with targeted

product and service offerings. This is reflected in the “knowing your customer” and “ Increasing value –

add” components of the strategic framework. From mass marketing(e.g. TV) to marketing to segments

of one (e.g. through personalized web portals). This is reflected in the “Customer interaction”

components of the framework. From business-centric interactions designed for the business’s efficiency

and convenience to customer-centric interactions designed for the customer’s efficiency and

convenience. This is another aspect of “Customer interaction”

BUSINESS OBJECTIVES OF CRM

The business objectives of CRM can be stated as:

1) Increasing revenues, optimizing profitability and sustaining a high rate of returns of investment.

2) Increasing market share and customer base.

3) Establishing competitive advantage and differentiation.

4) Long-term retention of existing customers.

5) Proper identification of new customers.

6) Ensuring high levels of customer satisfaction.

The decision to whether or not to go for CRM systems shall primarily depend on the cost-benefit

analysis. However, carrying out a cost-benefit analysis in this case is not going to be an easy task. Also,

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there is no direct method to calculate the cost-benefit analysis of implementing a CRM system. The role

of technology is extremely pivotal in maintaining a relationship with the customer. Today, the customer

interacts with the company in a number of ways. Common customer touch points include:

Sales.

Marketing and advertising.

Internet/www/email.

Field services.

Customer call centers and supports.

THE IDEAL CRM

Features that an ideal CRM should provide are:

Constantly show real-time behaviour predictions such as customers’ likelihood to churn, accept

up sell and cross-sell opportunities, and exhibit payment risks

Recommend offers and actions in real-time, based on customers’ predictive profiles, to increase

customer interaction efficiency

Automatically creates highly accurate models predicting critical customer behaviours such as

bad debt, responses to part offers/actions, and churn

Store predictive knowledge in an active repository – customer Knowledge Hub – accessible by

collaborates and front-office systems

Enable marketers to manage and optimise push/pull campaigns through the predictive

knowledge enterprise portal, 24*7 Marketer, across channels handled.

CLASSIFICATION, TABULATION, ANALYSIS & INTERPRETATION OF PRIMARY DATA

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GRAPH-1

MONTHLY TURN OVER OF RESPONDENTS

OBSERVATION:

In the above analysis 10% of respondent’s monthly income is between less than 10000,

20% of monthly income is between 10000-20000, 30% of monthly income is between 20000-

30000 & 40% of respondent’s monthly income 30000 & above

10

20

30

40

0

5

10

15

20

25

30

35

40

1

RESPONDENTS MONTHLY TURN OVER

Monthly Turnover

less than 10000

10000-20000

20000-30000

30000 and above

40

Monthly Turnover less than 10000 10000-20000 20000-30000 30000 and above

No of respondents 10 20 30 40


GRAPH 2

AGE GROUP OF RESPONDENT

OBSERVATION:

RESPONDENT AGE GROUP

5

35

40

20

0

5

10

15

20

25

30

35

40

45

1

Respondent Age Group

below 20 years

20-35 years

35-45 years

above 45 years

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Respondent Age Group

below 20 years 20-35 years 35-45 years above 45 years

5 35 40 20


Inn the above analysis 5% belongs to the age group of below 20 years, 35% belongs to the age

group of 20-35 years, 40% belongs to the age group of 35-45 years, 20% belong to the age group 45

above years

GRAPH-3

SALE OF BISCUITS

Opinion of the respondents No of respondents Percentage

Yes 100 100%

No 0 0%

Total 100 100

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OSERVATION:

From the above shows that all the respondents sell biscuits

GRAPH-4

BRAND PREFERANCE

100

0

0

20

40

60

80

100

yes no

Respondent opinion about sell the Biscults

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OBSERVATION:

From the above Table we can observe that, out of 100 respondents about 35% of them prefer Sunfeast,

about 25% of the respondents prefer Britannia, and 20% of respondents prefer Parle and other biscuits.

From the above table and analysis we can infer that, most of the respondents prefer Sunfeast.

GRAPH-5

Respondent Brand preference of Biscuits

35

20

25

20

Sunfest

Britannia

Parle

Others

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Respondent opinion about preference of biscuit brand

Sun fest Britannia Parle Others

35 20 25 20


PURCHASE OF SUNFEAST BISCUITS

Sl. No. Sub Brands No.of Respondents Percentage

1 Sunfeast milkly magic 79 21%

2 Sunfeast marie 68 18.37%

3 Sunfeast glucose 63 17.02%

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