Marketing and Selling Strategy of Amul
Amul is the largest co-operative movement in India and as the country's largest food company, is the market leader in butter, whole milk, cheese, ice cream, dairy whitener, condensed milk, saturated fats and long life milk.
Amul follows a unique business model, which aims at providing 'value for money' products to its consumers, while protecting the interests of the milk-producing farmers who are its suppliers as well as its owners. In butter, cheese and saturated fats, Amul has remained the undisputed market leader since its inception in 1955, by offering quality products at competitive prices. In other categories, Amul has nullified its late mover disadvantage through aggressive pricing, better quality, innovative promotion, and superior distribution.
The cooperative model pioneered by Amul - is known as the "Anand pattern" cooperative system. It was a three-tier structure that comprised village societies, district level dairy unions and a state level federation.
Each tier was economically independent of the others and comprised representatives elected from the tier below it. The organizations at each level were governed by their own bylaws, and were managed by democratically elected boards.
The marketing strategy of new offerings of Amul is to primarily create a brand so as to enable itself to create a monopolistic or oligopolistic situation in a market segment which is essentially homogenous and thus create brand loyalty. The consumers of Amul exhibit variety seeking behavior. Amul ensures push strategy in order to ensure availability of the product. The aim of the company is to provide value for money to its customers but never compromise on its product quality.
One of the most conservative FMCG entities, GCMMF spends a mere 1% of its turnover on promotions. GCMMF has written and re-written rules of the game. Amul butter girl is the the longest running ad campaigns for the last 41 years.
Given the wide product portfolio, Amul’s 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, Nutramul and Kool Kafe in 2006 and in 2010 it has shifted attention to Amul Koko — cold chocolate drink.
The various Non-Conventional Media steps taken by Amul are:
• Ploughing 90% of ad budgets into impact property buys rather than spot buys with sponsorships thrown in.
• Customizing format shows for Amul in each of the priority markets.
• Incorporating the Amul range in each show to showcase Amul’s width and depth.
For each of the properties, Amul identified situations within show content and conceived ideas to integrate the brands seamlessly, thus creating a property within a property for each of the brands.
Uses a variety of media to communicate intended message,most famous being the billboard campaign The endearing polka dressed girl and pun at various issues increases brand’s fan following.
Other promotion activities include the Amul food festival (held in 50,000 retail outlets), The Chef Of India contest, Amul Maharani contest, Singing Competition AMUL Star Voice of India, Amul Music Ka Maha Mukabla.
Thus Amul wants to shift the shift of consumer behavior from search attribute to credence attribute and finally converting to heuristics.
However there are certain conflicts in its marketing plans which are enumerated:
• Ownership of assets: Previously the company used to give the cooling equipment on lease to the retailers, when the company wanted the stuff back; the retailer disagreed to comply and created issues of ownership.
• Stocking issues: The company doesn’t want the retailers to stock the competing brand in the company leased fridges, which at times...
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