AMUL OVERVIEW

Type Co-operative

Founded in 1946

Headquarters Anand, Gujarat India

Industry Dairy

Parent Company GCMMF

Products milk and related products

Revenue Rs 2.3 billion (2001)

Employee 2 million milk producers

Slogan The Taste of India

WHY AMUL ENTERED THE PIZZA MARKET?

Indian company Amul, well known for its milk products, has introduced a
pizza for 20 rupees or one-third that charged by competitors.
Amul is one of the largest food cooperatives in the world and carries
immense financial and advertising clout. Its parent company, the Gujarat
Cooperative Milk Marketing Federation (GCMMF), turned around 25 billion
rupees last year. And even though they may not admit it, competitors
have started tightening their belt, in different ways.

Industry analysts point to two reasons. The main one is the growing
acceptance of pizza by the Indian customers' palate. Pizza has become
popular in all major cities and towns. According to industry sources, it
now forms almost 50 percent of the fast-food business.

Pizza joints are as ubiquitous as outlets for vada pav and pav bhaji, two
local delicacies. That the pizza has finally become a part of the Indian
eating experience is confirmed by the fact that several railway stations
have set up special stalls to hawk various brands of pizza. Until now, the
Indian railway traveller had to make do with stale tea and rancid
sandwiches.

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The second reason for Amul's invasion into the pizza market is its
inherent advantage: the fact that it does not view pizza as an end-product
as much as a medium for pushing sales of its own cheese.

SNOWCAP—AMUL PIZZA
In remote Surat, Amul was brewing an ambitious plot without much ado.
The co-operative first opened 10 pizza parlors in Gujarat. Amul then
planned to scale up operations in a year by setting up 2,000 such parlors
in 100 cities. What was crucial to the entire game was PRICING. Amul was
then currently test-marketing a basic capsicum, onion, tomato pizza at
just Rs. 20, which could well change the contours of pizza consumption in
the country.
Basically it looked like Amul has adopted this radical strategy to expand
the consumption of mozzarella cheese, a core ingredient that goes into
the making of pizzas.

PROBLEMS

 Lack of trust

 Packaging of the Pizzas was also questionable

 The taste of Pizzas was not at all appreciable

 Amul was not fast enough to see the changing trends and
accordingly introduce the product

 Amul’s strategy of creation of a mass market was entirely wrong

 Amul lost out because of its inability to communicate the

Positioning in a proper manner

 Amul’s Pizzas were not up to the quality levels defined by its all the
other products

 Amul overlooked the threat from Pizza Professionals like Pizza Hut
and Domino’s

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 Amul followed a strategy of Forward Integration

 The brand missed out on Consumer Loyalty

 The Value Proposition promised by Amul was not delivered

SWOT ANALYSIS
• STRENGTHS
Brand (company) name because of the number of years in the
market
Production facility
Trust of consumers

• WEAKNESS
No expertise in pizza making
Late entrant
Distribution channel
Freshness
Packaging

• OPPURTUNITIES
High growth of the food market
niche market, so can charge a premium

• THREATS
High degree of competition
Loosing out to rivals like Pillsbury because of the product
offering.

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 RECCOMENDATIONS
1. BRANDING
Though AMUL rightly spotted a growing lucrative market for the
pizzas, it did the biggest mistake of branding the pizzas as AMUL
PIZZAS. Basically AMUL did the brand extension in order to save the
expenses of building a new brand name and thus wanted to cash on
the brand value of AMUL. Thus we named it as HEATO
FRESH----“FRESH KAHA BHI, KABHI BHI”. Thus by introducing
Pizzas under this brand name, AMUL is giving the message of its
repositioned product i.e., now its pizzas can be heated over a tava
instead of a compulsory use of an microwave or an oven and apart
from that it also connotes to the freshness of Pizzas.

2. POSITIONING
Positioning is a perceptual location. It's where your product or
service fits into the marketplace. Effective positioning puts you first
in line in the minds of potential customers. HEATO FRESH should
also build an aura around itself, may be for example taking into
consideration the Family Picnics or Outings etc. and relate to that.
So that whenever consumers are thinking of that event, HEATO
FRESH should come to their minds.

3. MARKETING MIX
-PRODUCT
Amul should concentrate on Pizzas more rather than thinking it as a
means to increase the sales of it mozzarella cheese. It should give
more emphasis on the taste and quality of pizzas and improve the

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 same.It should introduce more variety of pizzas to cater to different
segments of customers.It should also be health focused.
Since the majority of its target customers are middle class people,
it should introduce the variant of pizzas, which can either be heated
on a pan or a tava, as in most cases consumers don’t have an oven
or a microwave.

-PLACE
DISTRIBUTION CHANNEL

a. Increase commission margins for distributors

b. Go for exclusive distributors

STAND ALONE STORES OF AMUL

PROMOTION

 Kirana Stores

 Railway stations

 Supermarkets---Ek Pe Ek Free and first purchase advantage

 Express highways

PRICE

We shall price it at Rs.20 only but with strong packaging by

providing a separate packet of Amul mozzarella cheese and a
separate packet of ingredients so that it doesn’t affect the quality
and taste.

4. BUILD ON CUSTOMER SATISFACTION, VALUE AND

RETENTION STRATEGY

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 Amul should try to fulfill Customer Perceived Value (CPV) and thus
gain Customer Satisfaction. This will ultimately result in Customer
Loyalty. The Value Proposition promised, should be delivered.
Attract and also retain the Customers.

5. AAU(ATTITUDE, AWARENESS, USUAGE) Strategy

A tracking study that would monitor the attitudes, awareness,

usage of the consumers through feedback forms and various other
means of tracking by which the necessary changes can be made to
have a good control over the market.

6. VALUE MARKETING

• Commitment to quality(TQM)

• Value for money

• Aggressive pricing

• Innovative promotion

• Superior distribution

• Fostering of loyalty

7. SYNERGY MARKETING: AUU + VALUE MARKETING

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