MITHIBAI COLLEGE OF ARTS, ARTS, CHAUHAN INSTITUTE OF SCIENCE & AMRUTHBEN JIVANLAL COLLEGE OF COMMERCE & ECONOMICS. VILE PARLE (WEST) MUMBAI - 400 056
A PROJECT ON : BRITANNIA INDUSTRIES LIMITED
IN THE SUBJECT MARKETING STRATEGY AND PLAN
PROJECT BY MR. PANCHAL HIREN SURESH ROLL NO. 47
DIVISION DIVISI ON : B
PROJECT GUIDE PROF . BHARAT PITHADIA
UNIVERSITY OF MUMBAI
M.COM. PART - I (FIRST SEMESTER)
ACADEMIC YEAR 2012 - 2013
MITHIBAI COLLEGE OF ARTS, CHAUHAN INSTITUTE OF SCIENCE & AMRUTHBEN JIVANLAL COLLEGE OF COMMERCE & ECONOMICS. VILE PARLE (WEST) MUMBAI - 400 056
DECLARATION
I, MR. PANCHAL HIREN SURESH student of MITHIBAI COLLEGE, studying in M.COM (PART I) Roll No. 47, hereby declare that i have completed my project, titled “BRITANNIA INDUSTRIES LIMITED” for the subject - MARKETING STRATEGY AND PLAN P LAN in the academic year 2012 - 2013.
The information submitted here is true and original as per my research and observation.
DATE OF SUBMISSION 16TH OCTOBER 2012.
SIGNATURE OF STUDENT (MR. PANCHAL HIREN SURESH)
2
MITHIBAI COLLEGE OF ARTS, CHAUHAN INSTITUTE OF SCIENCE & AMRUTHBEN JIVANLAL COLLEGE OF COMMERCE & ECONOMICS. VILE PARLE (WEST) MUMBAI - 400 056
DECLARATION
I, MR. PANCHAL HIREN SURESH student of MITHIBAI COLLEGE, studying in M.COM (PART I) Roll No. 47, hereby declare that i have completed my project, titled “BRITANNIA INDUSTRIES LIMITED” for the subject - MARKETING STRATEGY AND PLAN P LAN in the academic year 2012 - 2013.
The information submitted here is true and original as per my research and observation.
DATE OF SUBMISSION 16TH OCTOBER 2012.
SIGNATURE OF STUDENT (MR. PANCHAL HIREN SURESH)
2
MITHIBAI COLLEGE OF ARTS, CHAUHAN INSTITUTE OF SCIENCE & AMRUTHBEN JIVANLAL COLLEGE OF COMMERCE & ECONOMICS. VILE PARLE (WEST) MUMBAI - 400 056
CERTIFICATE
This is to certify that the undersigned have assessed and evaluated the project on To p ic - “BRITANNIA INDUSTRIES LIMITED” submitted by HIREN PANCHAL, student of M.Com. M.Com. – Part Part - I (Semester (Semester – I) for for the academic academic year year 2012-13. This project is original to the best of our knowledge and has been accepted for Internal Assessment.
Name & Signature of Internal Examiner
Name & Signature of External Examiner
PRINCIPAL
College Seal
DR. KIRAN MANGAONKAR
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ACKNOWLEDGEMENT
At this juncture, I would extend my gratitude to a number of people without whom this informative project would have been impossible. Every work that is appreciated is supported by various hands. This project would just not be complete without the valuable contribution from various people whom i have interacted with in the course of its completion.
I would like to sincerely acknowledge my guide PROF. BHARAT PITHADIA for providing me with an excellent and splendid opportunity to present this project on MARKETING STRATEGY AND PLAN which definitely has given a further professional approach.
I am extremely grateful to the University of Mumbai for having prescribed this project work to me as a part of the academic requirement in the MCOM -1course
lastly, I would like to appreciate the management and staff of MITHIBAI College, MCOM-1 for providing the entire state of the art infrastructure and resources to enable the completion and enrichment of my project.
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TABLE OF CONTENTS
Chapters
CONTENTS
Page No.
INTRODUCTION & HISTORY : 1
7 BRITANNIA INDUSTRIES LIMITED
2
BRITANNIA’S MARKE TING STRATEGIES
12
3
BRITANNIA’S MARKET ING ANALYSIS
22
4
CASE STUDIES
35
5
CONCLUSION
40
BIBLIOGRAPHY
5
Britannia Industries Limited
6
CHAPTER - 1
E AT HEALTHY, THINK BETTE R INTRODUCTION Britannia Industries Limited is an Indian company based in Kolkata that is famous for
its Britannia and Tiger brands of biscuit, which are popular throughout the country. Britannia is has an estimated 38% market share. The Company's principal activity is the manufacture and sale of biscuits, bread, rusk , cakes and dairy products. The company was established in 1892, with an investment of Rs. 295. Initially, biscuits were manufactured in a small house in central Kolkata. Later, the enterprise was acquired by the Gupta brothers and operated under the name of "V.S. Brothers." In 1918, C.H. Holmes, an English businessman in Kolkata, was taken on as a partner and The Britannia Biscuit Company Limited (BBCo) was launched. The Mumbai factory was set up in 1924 and Peek Freans UK, acquired a controlling interest in BBCo. Biscuits were in big demand during World War II, which gave a boost to the company’s sales. The company name finally was changed to the current "Britannia Industries Limited" in 1979. In 1982 Nabisco Brands Inc., USA became a major foreign shareholder. Kerala businessman K. Rajan Pillai secured control of the group in the late 1980s, becoming known in India as the 'Biscuit King'. In 1993, the Wadia Group acquired a stake in ABIL UK, and became an equal partner with Groupe Danone in Britannia Industries Limited. In what The Economic Times referred to as one of [India's] most dramatic corporate sagas, Pillai ceded control to Wadia and Danone after a bitter boardroom struggle, then fled his Singapore base to India in 1995 after accusations of defrauding Britannia, and died the same year in Tihar Jail. With this inspiring history, Britannia has reached every households of India reaching the top 100 Most Trusted brands listed in The Brand Trust Report by Trust Research Advisory. The beginnings might have been humble-the dreams were anything but. By 1910, with the advent of electricity, Britannia mechanized its operations, and in 1921, it became the first company east of the Suez Canal to use imported gas ovens. Britannia's business was flourishing. But, more importantly, Britannia was acquiring a reputation for quality and value. As a result, during the tragic World War II, the Government reposed its trust in Britannia by contracting it to supply large quantities of "service biscuits" to the armed forces. 7
As time moved on, the biscuit market continued to grow… and Britannia grew along with it. In 1975, the Britannia Biscuit Company took over the distribution of biscuits from Parry's who till now distributed Britannia biscuits in India. In the subsequent public issue of 1978, Indian shareholding crossed 60%, firmly establishing the Indian-ness of the firm. The following year, Britannia Biscuit Company was re-christened Britannia Industries Limited (BIL). Four years later in 1983, it crossed the Rs. 100 crores revenue mark.
On the operations front, the company was making equally dynamic strides. In 1992, it celebrated its Platinum Jubilee. In 1997, the company unveiled its new corporate identity - "Eat Healthy, Think Better" - and made its first foray into the dairy products market. In 1999, the "Britannia Khao, World Cup Jao" promotion further fortified the affinity consumers had with 'Brand Britannia'.
Britannia strode into the 21st Century as one of India's biggest brands and the pre-eminent food brand of the country. It was equally recognized for its innovative approach to products and marketing: the Lagaan Match was voted India's most successful promotional activity of the year 2001 while the delicious Britannia 50-50 Maska-Chaska became India's most successful product launch. In 2002, Britannia's New Business Division formed a joint venture with Fonterra, the world's second largest Dairy Company, and Britannia New Zealand Foods Pvt. Ltd. was born. In recognition of its vision and accelerating graph, Forbes Global rated Britannia 'One amongst the Top 200 Small Companies of the World', and The Economic Times pegged Britannia India's 2nd Most Trusted Brand.
Today, more than a century after those tentative first steps, Britannia's fairy tale is not only going strong but blazing new standards, and that minuscule initial investment has grown by leaps and bounds to crores of rupees in wealth for Britannia's shareholders. The company's offerings are spread across the spectrum with products ranging from the healthy and economical Tiger biscuits to the more lifestyle-oriented Milkman Cheese. Having succeeded in garnering the trust of almost onethird of India's one billion population and a strong management at the helm means Britannia will continue to dream big on its path of innovation and quality.
8
CHAPTER - 2 HISTORY OF BRITANNIA BISCUITS
The beginnings might have been humble-the dreams were anything but. By 1910, with the advent of electricity, Britannia mechanized its operations, and in 1921, it became the first company east of the Suez Canal to use imported gas ovens. Britannia's business was flourishing. But, more importantly, Britannia was acquiring a reputation for quality and value. As a result, during the tragic World War II, the Government reposed its trust in Britannia by contracting it to supply large quantities of "service biscuits" to the armed forces.
As time moved on, the biscuit market continued to grow… and Britannia grew along with it. In 1975, the Britannia Biscuit Company took over the distribution of biscuits from Parry's who till now distributed Britannia biscuits in India. In the subsequent public issue of 1978, Indian shareholding crossed 60%, firmly establishing the Indianness of the firm. The following year, Britannia Biscuit Company was re-christened Britannia Industries Limited (BIL). Four years later in 1983, it crossed the Rs. 100 crores revenue mark.
On the operations front, the company was making equally dynamic strides. In 1992, it celebrated its Platinum Jubilee. In 1997, the company unveiled its new corporate identity - "Eat Healthy, Think Better" - and made its first foray into the dairy products market. In 1999, the "Britannia Khao, World Cup Jao" promotion further fortified the affinity consumers had with 'Brand Britannia'.
Britannia strode into the 21st Century as one of India's biggest brands and the pre-eminent food brand of the country. It was equally recognised for its innovative approach to products and marketing: the Lagaan Match was voted India's most successful promotional activity of the year 2001 while the delicious Britannia 50-50 Maska-Chaska became India's most successful product launch. In 2002, Britannia's New Business Division formed a joint venture with Fonterra, the world's second largest Dairy Company, and Britannia New Zealand Foods Pvt. Ltd. was born. In recognition of its vision and accelerating graph, Forbes Global rated Britannia 'One amongst the Top 200 Small Companies of the World', and The Economic Times pegged Britannia India's 2nd Most Trusted Brand.
9
Today, more than a century after those tentative first steps, Britannia's fairy tale is not only going strong but blazing new standards, and that miniscule initial investment has grown by leaps and bounds to crores of rupees in wealth for Britannia's shareholders. The company's offerings are spread across the spectrum with products ranging from the healthy and economical Tiger biscuits to the more lifestyle-oriented Milkman Cheese. Having succeeded in garnering the trust of almost onethird of India's one billion population and a strong management at the helm means Britannia will continue to dream big on its path of innovation and quality. And millions of consumers will savour the results, happily ever after.
HISTORY OF BISCUITS:
Sweet or salty. Soft or crunchy. Simple or exotic. Everybody loves munching on biscuits, but do they know how biscuits began? The history of biscuits can be traced back to a recipe created by the Roman chef Apicius, in which "a thick paste of fine wheat flour was boiled and spread out on a plate. When it had dried and hardened it was cut up and then fried until crisp, then served with honey and pepper." The word 'Biscuit' is derived from the Latin words 'Bis' (meaning 'twice') and' Coctus' (meaning cooked or baked). The word 'Biscotti' is also the generic term for cookies in Italian. Back then, biscuits were unleavened, hard and thin wafers which, because of their low water content, were ideal food to store.As people started to explore the globe, biscuits became the ideal traveling food since they stayed fresh for long periods. The seafaring age, thus,witnessed the boom of biscuits when these were sealed in airtight containers to last for months at a time. Hard track biscuits (earliest version of the biscotti and present-day crackers) were part of the staple diet of English hand American sailors for many centuries. In fact, the countries which led this seafaring charge, such as those in Western Europe, are the ones where biscuits are most popular even today. Biscotti is said to have been a favorite of Christopher Columbus who discovered America.Making good biscuits is quite an art, and history bears testimony to that.
10
TIMELINE OF BRITANNIA
1892: Inception as a small house manufacturing biscuits in central Calcutta with an investment of
Rs 295. 1897: The Gupta Brothers acquired the business, and moved the operations to Dum Dum, a suburb
of Calcutta, under the name of V.S.Brothers. 1918: An English businessman C.H.Holmes joined as a partner. 1918: The BIL Biscuit Company (BBCo) was registered. 1924: BBCo established its second factory at Mumbai. 1954: BBCo acquired the Delhi Biscuit Co and began the manufacture of sliced and wrapped bread
in Delhi. 1961: The production of bread was started in Mumbai. 1967: The company set up a fourth factory for the manufacture of biscuits and bread in Chennai.
1971: BBCo diversified into seafood. 1973: An integrated processing and freezing plant for seafood was commissioned at Thane. 1976: Bread was introduced in Calcutta with the commissioning of two modern indigenously
fabricated automatic baking plants. 1978: BBCo came out with a public issue as a result of which the Indian public's shareholding
crossed 60% and the foreign shareholding (which was 53.37% held jointly by Control Nominees Ltd. and Associated Biscuits International Ltd, both of the UK), decreased to less than 40%. 1979: In October the company's name was changed from Britannia Biscuits Company to Britannia
Industries Limited (BIL).
11
CHAPTER - 3 BRITANNIA’S ORGANIZATIONAL STRATEGIES
Corporate Strategy
“GOOD FOR HEALTH; GOOD FOR TASTE; FINEST IN BRAND; AFFLUENT IN PRICE", are the startegies employed by Britannia for its towering stature today.
Marketing Strategies:-
Milk-Biskies are made especially for children. Britannia TIGER Biscuits are made for boys and girls in the age group of 7to14. Britannia is quick to realize the wants of teenagers; it brought a special brand for this group in the name "Little Hearts" which became super hit in no time. Britannia's next strategy was to introduce a new brand with a question tag “Sweet or Hot “biscuit. It was branded as "50-50-Biscuit". When the decision is referred to the 3rd umpire in cricket, we all see "50-50" blinking in the screen; it is also a way to impress the biscuit brand's name in the minds of cricketing world. Marrie Gold is an universal brand introduced by Britannia which is sought after in tea time and when travelling, thus making the demand for this brand as the highest which is also due to an affluent price.
Promotional Strategies:-
"Eat Britannia, Go for World Cup" was the theme adopted in 1999 .People bought the biscuit packs and searched for the lucky scratch for flying to England to see world Cup Cricket match.The sales bounced 37% high on account of this strategy. The scheme came alive again during the world Cup Match in 2002-2003 in South Africa. “Lagan - the super hit movie " brought fame to Britannia Biscuits also as 40000 buyers of Britannia Biscuit packs were invited to see and a small lucky group to play the game with the movie Stars of Lagan. What a novel way to promote a product - a perception in correct proportion indeed!!
12
Business Strategies:
Britannia key priorities continue to be to drive revenue through brand relevance and differentiation and to enhance profitability through cost competitiveness. This includes strengthening current brands through product design, delivery and mix and introducing new differentiated higher margin products. To drive this harder, the focus on understanding consumers and meeting their needs will be enhanced to create and sustain higher levels of purchase and consumption. Nutrition efforts will be further strengthened by offering more value to consumers through healthy options at affordable price points as well as through focusing on other relevant consumer benefits. Britannia will continue to focus on market place execution to drive higher sales at point of purchase, synergizing all levers including distribution, trade marketing, market activation and advertising. Britannia will continue to build the edge in trade channels through width and depth of reach, service quality and customer insight, and create best in class customer and people engagement practices for sustained, superlative delivery. Britannia is working at new programs that will deliver retail excellence and synergies across the product lines at the front end. Britannia has implemented several initiatives in all areas of operations to create an efficient and robust supply chain. These will be reinforced further by integrating manufacturing and logistics and industrializing the set of manufacturing practices and technologies the Company has built to date.
13
CHAPTER - 4 MARKET SEGMENTATION AND SELECTING TARGET MARKET
It is an effort to increase a company's precision marketing. The starting point of any segmentation discussion is mass marketing. In mass marketing, the seller engaged in the mass production, mass distribution and mass promotion of one product for all buyers. Market segment consists of a large identifiable group within a market with similar wants, purchasing power geographical location, buying attitudes or buying habit. It is an approach midway between mass marketing and individual marketing. Through this the choice of distribution channels, and communication channels become much easier. The researchers try to form segments by looking at consumer characteristics; geographic, demographic, and psychographic. After segmenting the market then target market selected.
Positioning:- The positioning is a creative exercise down with an existing product. the well known
products generally hold a distinctive position in consumer's minds. The positioning requires that every tangible aspect of product, price, place and promotion must support the chosen positioning strategy. Company should develop a unique selling proposition (USP) for each brand and stick to it, PPL consistently promotes its DAP fertilizer by Higher yield at lower cost. As companies increase the number of claims for their brand, they risk disbelief and a loss of clear positioning. In general a company must avoid four major positioning errors. Those are under positioning over positioning, confused positioning and doubtful positioning.
Product:- A product is any offering that can satisfy a need or want. The major types of basic
offerings are goods, services, experiences, events, places, properties, organizations, information and ideas. The company gives more importance in quality, packaging, services etc. to satisfy the customers. The products has it's life cycle. The product strategies are modified in different stages of product life cycle.
Price:- It is the most important aspect in company's point of view. Price of the product will be
decided by the company according to the competitor's price. 14
Place:- This plays a major role in the entire marketing system. the company emphasis on it's
distribution network. Proper distribution network gives proper availability of the product.
Promotion:- Promotion is the one of the major aspects in marketing strategies. By adopting various
promotional activities the company create strong brand image. It also helps in increasing the brand awareness. It includes advertising, sales promotions and public relations etc.
Research and Development:- after testing, the new product manager must develop a preliminary
marketing strategy plan for introducing the new product in to the market. The plan consists of three parts. The first part describes the target market's size, structure and behavior. The second part out lines the planned price, distribution strategy and marketing budget for the first year. The third part of the development describes the long run sales and profit goals and marketing mix strategy over time.
15
CHAPTER - 5 MARKETING STRATEGY Marketing is not Euclidean geometry a fixed system of concept. Rather marketing is one of the dynamic fields with in the management arena. The market faces continually a new challenge everyday and companies must respond to it positively. Therefore it is not surprising that new market idea keep surfacing to meet new market place challenges. The market process is applicable to more than goods and services. Anything related to market including ideas, events, policies, prices and personalities comes under market strategy. However it is important to emphasize opportunity in the market through market strategy. BRITANNIA company has won many awards , because of their high quality products and customer satisfaction and became 1st biscuit company in world. Since they are also worth for their marketing strategies let’s gaze across.
The main marketing strategies followed by the firm are-
• Product strategy
• Reduced losses by way of elimination of losses
• Target customers to capture growth in each category by segmenting the market both along conventional lines and through segmentation
• Look beyond the product, at the customer. And use knowledge to reposition the brandy
• High class R&D, and recently enhanced testing and evaluation facilities
• A corporate image of quality.
16
Following are strategies adopted by the organization.
A strong quality of the product and customer satisfaction:
F
Customers always believe in good quality product. in my survey I found that in percentage term more people is quality conscious and not price conscious. Customer satisfaction is very important part of the organization that at any cost they have to fulfill. A growing relationship with customer and customer retention:
F
Nowadays a good relation with customer is very important for organization. Sale is totally depending on the relation with the customers. Customer's retention is also a major aspect for growing business. It means keep the old customer and try to make new customer. Focus on competitors activity:
F
Every organization should must be careful about it's competitors step, because they can disturb the growing sales process of the organization. A growing emphasis on global thinking and local marketing planning:
F
Companies are increasing by pursuing market beyond their borders. When they enter other countries they must follow the tradition of that country and also they make plan for local market that which type of product has more demand and how can it run in the market. Promotional Strategy
F
Under the market strategy promotional idea is very important. Organization provides some schemes or rebates to retailers or consumers. They make advertisement according to convenient of the people and the feature of the product. • Growth strategy Growth strategies enable the organization to expand, either through mergers or acquisitions, or establishing a new plant.McDonald has pursed its growth strategy through direct expansion. It never purchased other fast-food restaurants' chains. It has grown only by granting franchises to people who are willing to be retained in "McDonald's Way"
Major forms of growth strategies are concentration, vertical integration and diversification. 17
Concentration: Concentration focuses on growth through single product or a small number of closely related products. Concentration usually takes place through market development(gaining a larger share of current market or expanding new ones), product development (improving a basic product or service or expanding into closely related product or service) or
horizontal
integration (adding one or more businesses).
Vertical integration: It is a means through which the firm produces its own inputs.
So on the basis of marketing strategy a organization runs in the market. It is several types of which makes helpful to increase sales and turnover of the organization.
"Eat Britannia, Go for World Cup" was the theme adopted in 1999 .People bought the biscuit
packs and searched for the lucky scratch for flying to England to see worldCup Cricket match.The sales bounced 37% high on account of this strategy.The scheme came alive again during the world Cup Match in 2002-2003 in South Africa.
"Lagan -the super hit movie "
brought fame to Britannia Biscuits also as 40000 buyers of Britannia Biscuit packs were invited to see and a small lucky group to play the game with the movie Stars of Lagan. What a novel way to promote a product - a perception incorrect proportion indeed.
18
MARKET POTENTIAL Market potential of the BRITANNIA is much positive in competitive era and will sure cover the maximum market share of biscuit product. Potentiality of any product depends upon the futuristic performance of the product. it depends that how much retailers have potentiality to be permanent seller of BRITANNIA.
For great potentiality it is necessary to improve those factors which are going to effect retailers. In my study I found some factors which can help to cover great potentiality.
These factors are following: •
Scheme delivery should in perfect determining time.
•
Some places distributors not able to cover his particular area. That should be improved.
•
Scheme facility should be regular as much as possible.
•
Small pack also should be in the market.
•
Always collect the views of retailers. It gives psychological effect on the retailers about care ness by manufacturing company.
These factors are very important for the organization. If company is able to improve these all factors then definitely its market share will more increase. Retailers will take more interest to sell Britannia biscuit and customer will also enjoy for it.
So potentiality is very high to Britannia biscuit in positive direction.
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MARKET PENETRATION
Market penetration occurs when a company enters/penetrates a market with current products. The best way to achieve this is by gaining competitors' customers(part of their market share).Britannia adopted a new strategy which include attracting non-users of your product or convincing current clients to use more of your product/service (by advertising etc).Market penetration occurs when the product and market already exists
1.Market development.
Britannia attempt to identify and develop new markets for marketing current products.There are three general strategies applied in market development: (1) working within the demographic market to see if any particular demographic group can be encouraged to buy more of the product or if any new group within the demographics can be encouraged to purchase the product; (2) looking at the institutional market to see if these buyers can be increased; (3)attempting to develop markets in new geographical areas.To effect these strategies, Britannia attempt new distribution methods, change the design of
promotional efforts, and attempt to discover and promote innovative uses for an
existing product.
2. Product development.
Britannia company has adopted many strategies to develop new product. So that they can attract new customers and satisfy old customers.New product development is also a necessary response to new technology and changing market conditions. New product development may be handled by a dedicated department within the company or maybe part of each brand manager's responsibilities. E.g - Britannia has tried to develop their products as per the customers convenience.Diabetic customers always prefers biscuits like nutria choice. Britannia treat and Nutri choice is is the best example of it.
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BRITANNIA'S PROMOTIONAL STRATEGIES Britannia used aggressive promotion strategy by spending INR 100 million to its promotion campaign. In the year 1999, the campaign of “Britannia khao world cup jao” became a major success that rose the company profit up by 37%. Again in the year 2001, the other innovative campaign “Britannia Lagaan Match” became the India’s most successful promotional activity of the year. In the year 2005, the company launched “Greetings” range of premium a ssorted gift packs that contributed to the significant sales and margin growth. Britannia looked down the measure to cut down the production costs and followed distribution manufacturing strategy. It produced only 30% of the company products at its own plants and rest 70% were outsourced from outside companies that produces the products exclusively for Britannia. The company continuously tested, checked and monitored the product in order to ensure that its product’s value and quality are well integrated. The company also invested heavily in R&D segments and came up with new products with the successful launch of Treat Duet, Britannia 50-50 Maska- Chaska, Marie Gold Doubles, Pepper Chakkar, cup cakes, chocolate cakes and renovation of Good day variants. In order to reach the whole market segment, it positioned its products to various group of consumers like Milk Bikis for mother with little kids, Tiger Banana for kids that helped in their physical growth, Nutrichoice biscuits to women who suffered from osteoporosis, etc. In order to reach to kids segment, it also started introducing biscuits in animal shapes and in smiley faces and full of milk cream that made very popular among children. The idea of milk cream in the Milk Bikis has promoted drinking milk in the yummy way. The company is focusing growth through acquisitions. It formed an alliance with ‘CCD Daily Bread Pvt. Ltd” a Bangalore based Bakery product Company. In 2007, it formed a joint venture with Khimji Ramdas Group and acquired a beneficial stake in the Dubai-based Strategic Foods International Co. LLC and also in the Oman-based Al Sallan Food Industries Co. SAOG who were the key players in biscuit and cookies segment. Britannia is considered as a leader in innovation having a corporate identity of “Eat Healthy, Think better”. It is rated as the India’s No 1 trusting and caring food brand according to economic times, winner of world star award for its unique packaging and has accorded the status of being a ‘Superbrand’. Having succeeded in gaining a trust of millions of Indian population and a strong management and leadership, has led Britannia to continue to walk on a path of innovation and quality. 21
CHAPTER - 6 BRITANNIA'S SWOT ANALYSIS STRENGTHS 1.
Strong Parentage
Group Danone has a 22% stake in Britannia Industries. Danone is number 1 worldwide in dairy products, number 2 in bottled water and biscuits 2. Britannia Brand Name
Britannia is already a well established name in the minds of Indian Consumers. They have delivered sustained quality in return, reaped the benefits of consumer loyalty. 3. The Biscuits Business
Biscuits contribute over 80% to the revenues of Britannia. The Indian biscuit market is worth around Rs 4500 cr and the organized segment contributes Rs 2500 cr to the total. The Biscuit market is growing as a whole, thus Britannia stands to benefit just by maintaining itself. 4. The Tiger Brand
Britannia’s Tiger brand is very successful in it’s segment. Launched as direct competition to Parle’s Glucose Biscuits, it contributes 25% of the Companies Volumes and 19% of its sales 5. The Premium Range
Britannia faces no competition at all in its premium range of biscuits.
It’s Cream Treat
Range of Products are at present the only players in that segment. 6.
Innovation
Britannia has been consistently adding new products to its existing lines, and has been successful also because of its strong distribution network. It has introduced a new range of namkeens in Mumbai called Britannia Snax. IT added the Sweet Lassi and Cold Coffee to its flavoured milk line. 7. Superior Marketing Skills 22
Britannia has Time and Again exhibited its understanding of the Indian consumer. This has been in the form of new launches, innovative marketing and promotional schemes. Britannia had tied up with the makers of ‘Lagaan’. Britannia has been associating itself with cricket and has achieved good results. 8. Investments for the future
Britannia has acquired the ‘Kwality’ trademark for Rs 30 cr and 49% in Kwality Biscuits. Recently Britannia also acquired a 49% stake in Snacko Bisc that owns the 'Nutrine' brand. It picked up a controlling stake in Pondicherry-based Auro Foods. These acquisitions will help Britannia target various niche markets. 9. The Dairy Business – Joint Venture with Fonterra Group
India is the largest producer of milk in the world with an output of 78 million tonnes per annum. Britannia has transferred its dairy business to the Joint Venture. The new company has full access to Fonterra's research and development strengths to help further upgrade product quality and reduce product costs. 10. The Distribution Chain
Britannia has built an enviable distribution chain across the country in 2,200 towns with over 4, 00,000 outlets. It is developing this network further with a bias towards the Rural Areas. 11. Leveraging the Net
They were able to avail end-to-end procurement services and use e-procurement and reverse auctions to tap over 82 suppliers leading to new supplier/price discovery. They achieved 5 per cent cost savings and continues to use e-procurement extensively to utilise more cost effective transport routes.
23
WEAKNESSES
1.
Danone India
Groupe Danone has set up a wholly owned subsidiary Danone India to market its mineral water product Evian. Depending on how this brand develops, it might become a competitor to Britannia. 2. Loss of Flexibility
As long as Britannia were sourcing their milk products from Dynamix, they enjoyed a certain amount of flexibility, this will not be possible in their new venture, since it will run through the entire production process in – house. 3. Fallout of the Sunil Alagh Incident
A lot of things that made Britannia what it is today happened under the leadership of Mr. Sunil Alagh. The Sudden termination of his term 9 months before the completion of his term, after serving as MD for 10 years is bound to raise questions about the company. 4. Over Dependence on Biscuits
Britannia is relying heavily on its income from the biscuits segment. This will not harm the company as long there are no bad monsoons or other incidents that may jeopardize their production. Britannia must develop its other product lines so as to be more certain.
24
OPPORTUNITIES
1. The Dairy Market
Although Amul is a big player in the dairy products market, the unorganized sector is so big, that several more ‘Amuls’ can be accommodated. 2. Expansion
There still remains a good opportunity for expansion, since the biscuit field has many players in the organised sector. 3. Diversification
Britannia should add new products to it’s portfolio to compete with rival brands. This will ensure its survival and give it a chance at market Dominance. 4. Promotion of Parent Company’s Products
Britannia can promote the products of its Parent Company Groupe Danone, which is one of the largest in the world. In this way it can avion developing a competitor in Danone India. 5. Changing demographics
Changing Demographics (young, higher disposable income, experimental, urbanization, willingness to spend) further fuelled by trends like a greater awareness of health and nutrition on one hand and more hedonism (especially the new ‘affluent’ generation) is rapidly enlarging the opportunity. 6. New consumption moments, new consumers, new needs and desires
New consumption moments, new consumers, new needs and desires are growing in Britannia’s market, e.g. out-of-home consumption, life stage and lifestyle changes, etc. Even as new niches are developing, it is the Indian heartland that is fundamentally changing and in its aspirational quest is exploding growth for relevant and differentiated propositions offered at the right price and value. It is on the cusp of the big change that represents a large and enduring opportunity for Britannia.
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THREATS
1. Market Competition
Although Britannia currently dominates the market to a good extent, it is threatened by the forays made by several firms, especially the joint Ventures between MNC, like Nestle and HLL and Priya Gold has doubled it’s Production facilities.
These MNCs can flood the
market with products from their parent companies. 2. Increase in Excise Duty
The increase in excise duty on biscuits in the low cost bracket will have an impact on Britannia; in particular it’s Tiger Brand. 3.
Environment
The FMCG market in general if showing recessionary tendancies. Although, Britannia has come out unscathed so far, It will only get more difficult to grow and develop. 4.
Regulations
The Government has agreed to form and implement a plan and committee to control specifications for the production of foods. This will be an additional cost on the company. 5. Accusations of Unfulfilled Claims
There have been reports published of manufacturers who failed to live up to the claims they make, eg. the quantity of minerals in their product. guilty of such activity, it destroys consumer confidence.
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Although Britannia has never been
PORTERS 5 FORCES ANALYSIS Threat of Competitors •
Better distribution network for players like Parle, especially in rural India.
•
Brands like Parle, Nestle, PepsiCo, and Cadbury have distinct identity and segmented consumer base ranging from BOP to high end premium consumers.
•
Existing regional players coupled with lower brand awareness in Rural India, which is largest consumer base makes the competition all the stiffer.
Threat of New Entrants •
•
Lack of product differentiation in Rural India, makes entry of new entrants easier. Entry of global players like DANONE and Kraft, and retail brands in the urban market (modern trade) is the cutting away the existing consumer base.
Threat of Suppliers •
For raw materials like cashew, almonds, nuts suppliers are few and far. Hence they charge premium.
•
Different state taxation laws make it difficult for Britannia to come up with standard rate policy.
•
Supplier’s rates are high elastic with food inflation, however the end products have to virtually remain inelastic.
•
For products like chocolates and creams there is high overhead cost which are to incurred.
•
Lack of good quality creams suppliers especially during summers also marks the problem.
Threat of Buyers •
Consumption of Biscuits have reduced over the years.
•
Children in the age group of 5 to 15 years which were considered the primary consumers of cream biscuits have moved away to different variety of products available.
•
Rural India is extremely sensitive to price and hence Britannia can not compete with regional players and brands like Parle in this part
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Threat of Substitutes •
Substitutes for Britannia will include brands like Quaker, Maggi, Frito-Lays, Bingo, Kurkure.
•
Parle, Nestle and Pepsico are present in alternate categories, however Britannia’s performance is very meek.
•
Consumers prefer healthier and more nourishing food items likes Oats as part of Breakfast.
•
Even for regular in-between meals chips, crackers are preferred over biscuits.
•
Only limited market is present in cream biscuit category.
•
Also healthier in between meals like Yogurt, soups etc are also on a increase.
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STRATEGIC ADVANTAGE PROFILE (SAP) - ANALYSIS Finance
In an environment that is becoming increasingly competitive and in a business whose profit and profitability are greatly impacted by commodity inflation, profit from operations increased from Rs. 1,248 MM to Rs. 1,794 MM. Britannia added Rs. 8,194 MM to the gross sales, which grew 23.9%. Earnings per Share was Rs. 12.16. In 2010-11 the unprecedented inflationary pressures on the consumer food basket continued, as did commodity inflation for the food industry. Against this adverse economic scenario and continued competitiveness that eroded the overall industry profit pool, Britannia continued to focus on its growth strategy, led by its Power Brands and at the same time restructured operations to reduce cost. Britannia bakery brands including cake, rusk and bread grew 23.9% with biscuit brands outpacing market growth. Marketing
The marketing strategy emphasized on offering innovative products at premium prices, novel promotional campaign and developing extensive distribution network. Brands provide the momentum for business growth and during the year, investment in Research and Development, Advertisement and Sales Promotion increased by 12.7% and coupled with the renovation and innovation efforts, resulted in 23.9% growth. Several new and renovated offerings were successfully introduced across the entire portfolio that includes Milk Almond Cookies, Fruit Dhamaka Cookies, Tiger Krunch - Fruit n Nut/Chocochips, Diabetic friendly biscuits under Nutrichoice, Time Pass Toasted snack variants, Maska Chaska variants, Treat-O and GoodDay Chocochips and Choconut.
Significant introductions in Bread and Cake include Sweet Bread, Milk Bread, Healthy Slice Bread, Premium Sandwich variants and Fruit chunk cakes, and provided significant impetus to the Bread and Cake business. Britannia continues to invest significantly in its capability-building and structured innovation process, which is reflected in the launch of varied and differentiated offerings to strengthen the business. Britannia Company has also initiated the process for breakthrough innovations through interactions with reputed institutions, which is expected to help build a strong platform for sustained and significant business leadership and growth. Significant innovation in
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packaging has led to the introduction of attractive and cost-effective new packs catering to increasing purchase and consumption both in-home and out of home.
Operations:
Britannia has revised its manufacturing footprint to support profitable growth. In that context, capacities were created at relevant locations to meet demand. Additionally, there was the continual focus on de-bottlenecking existing capacities and improving the productivity levels at current units. The creation of these capacities and capabilities has helped the Company deliver the volume growth at improved customer service levels and lower costs. The singular focus of supply chain has been to improve availability of stocks and reduce overall cost. A continuous focus on availability through specific projects in the customer service area improved the availability of SKUs at depots and with customers. New tools have been introduced for price discovery and this has brought in vendors with new capability. Further, a focused effort was made to improve volumetric utilization of trucks, which led to good savings. In addition, an IT tool was used to generate the optimum network and this was rigorously followed to deliver the least cost in manufacturing and distribution.
Personnel Capability:
Britannia’s philosophy has been to create an open and transparent culture, focused on people and their competencies for delivering superior performance. During the year under review several people initiatives have been undertaken – from strengthening the performance management system to building learning and development programs. There was a high emphasis on the Functional training programs, which have a direct contribution to business such as Food Safety Programs, TQM, Kaizen initiatives, to name a few. Britannia embarked on a journey of engaging large number of people on profit improvement initiatives. There were over 150 such projects completed during the year, covering the entire value-chain. These invariably covered complex, cross functional projects. Other people related initiatives included a strengthening of the performance management system and “Gyanodaya” which is a development program in partnership with XLRI faculty for identified officers.
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Sustainable Development:
Britannia continues to pursue its Corporate Responsibility by driving the Health and Nutrition agenda in India. Your Company is moving along the path of “Better for You” products and “Good for You” products. “Better for You” includes initiatives of removal of unhealthy content like transfat which the Company undertook three years ago and continues to be the leading Company doing the same. Britannia now has a portfolio of “Good for You” products which are vitamin and mineral enriched – these products constitute 55% of Britannia’s product portfolio. In the last year, Britannia pioneered energy-snacks specially created for people with diabetes – Nutrichoice Diabetic Friendly Essentials. As you would be well aware, India is the Diabetes capital of the world. Another well documented statistic is that India suffers from wide spread micronutrient deficiency - the most notable being Iron Deficiency or Anaemia which affects 70% of the Indian population. Britannia continues to support several NGOs by supplying specially formulated Iron Fortified Biscuits. Britannia pursues relevant partnerships with key organizations in Nutrition like GAIN (Global Alliance for Improved Nutrition), UNWFP (United Nations World Food Program), WBI (World Bank Institute), CGI (Clinton Global Initiative), etc. Your Company has been recognized for its CSR efforts in the last year by the eminent Rotary Club of India and the Navjyoti Foundation. Britannia also set up the Britannia Nutrition Foundation which seeks to “Secure every child’s right to growth and development through good food everyday”. The objective of the Britannia NutritionFoundation is to work in three core areas – Scientific Knowledge Building and Dissemination, Education and Awareness building at grass root levels, Creating a Platform for Action.
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BRITANNIA’S
ETOPANALYSIS
Outlook
The Company expects sustained growth of both the bakery and dairy segments over a medium term horizon, buffeted by some volatility in commodity prices. Simultaneously, the widening of the consumer food basket with growth in disposable income, will enhance growth and investment opportunities in existing and adjacent categories thereby opening up new vectors of growth. In bakery, growth will endure for relevant and differentiated propositions, offered at the right price value. This will direct effort in enhancing differentiation through innovation and simultaneously eliminating costs through the entire value-chain. In dairy, growth will be achieved through a steady and gradual shift to branded products like dahi and milk and through value-added and differentiated functional products. International markets are likely to stabilize, especially in the large middle-east geography where your Company has manufacturing and marketing operations. With the entry of your Company’s brands in Saudi Arabia market, the middle-east business will see a boost. Your Company will continue to drive profitable growth in an extremely competitive environment with focus on consumers, customers and cost effectiveness. Economic
Biscuits constitute the largest, branded and packaged category within food, with a healthy growth momentum. Among the total universe of food in India valued at 11,000 Bn in 2010-11 and expected to grow to ` 13,200 Bn by 2015, the share of branded and packaged food is ` 990 Bn. Biscuits form 124 Bn of this. In other words, the biscuit category dominates branded food and has grown at a CAGR of 14-16% in the last five years. The biscuit market recorded double digit growth this year as well and this is likely to sustain in the coming year even though volatile commodity prices may impact margins. Growth has been driven by variety products like cookies and creams getting more affordable as well as the value perception of biscuits improving vis-a-vis other categories. Up gradation of the mass market to better varieties, albeit at accessible prices and price-points as well as the emergence of higher value niches, anchored on superior differentiation will be the leading growth vectors. Britannia is well positioned to participate in this growth. Competition in biscuits is expected to intensify as more players – both local and Multinational enter the market supported by significant brand investment. Britannia builds its business strategy taking into account the opportunities for growth, within the competitive and cost scenario.
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Technology Supply Chain
The singular focus of supply chain has been to improve availability of stocks and reduce overall cost. A continuous focus on availability through specific projects in the customer service area improved the availability of SKUs at depots and with customers. New tools have been introduced for price discovery and this has brought in vendors with new capability. Further, a focused effort was made to improve volumetric utilization of trucks, which led to good savings. In addition, an IT tool was used to generate the optimum network and this was rigorously followed to deliver the le ast cost in manufacturing and distribution. Information Technology
Your Company continues to invest in Information Technology to improve operational efficiencies and enhance productivity. During the year a business intelligence system was implemented to enable effective analysis of secondary sales information to drive top line growth by identifying new opportunities. A project has also been initiated to connect the contract manufacturing units and depots to the Company’s data centre in Bangalore through a more efficient network to ensure faster response to IT systems. During the year, your Company also consolidated its core ERP infrastructure using new generation servers leading to significant reductions in energy/ power consumption and enhanced efficiencies. Manufacturing
Your Company has revised its manufacturing footprint to support profitable growth. In that context, capacities were created at relevant locations to meet demand. Additionally, there was the continual focus on de-bottlenecking existing capacities and improving the productivity levels at current units. The creation of these capacities and capabilities has helped the Company deliver the volume growth at improved customer service levels and lower costs. Social
Britannia’s philosophy has been to create an open and transparent culture, focused on people and their competencies for delivering superior performance. During the year under review several people initiatives have been undertaken – from strengthening the performance management system to building learning and development programs. There was a high emphasis on the Functional training programs, which have a direct contribution to business such as Food Safety Programs, 33
TQM, Kaizen initiatives, to name a few. Britannia embarked on a journey of engaging large number of people on profit improvement initiatives. There were over 150 such projects completed during the year, covering the entire value-chain. These invariably covered complex, cross functional projects. Other people related initiatives included a strengthening of the performance management system and “Gyanodaya” which is a development program in partnership with XLRI faculty for identified officers.
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CHAPTER - 7 CASE STUDIES Brand Strategy that Britannia used to promote Good day Britannia Industries Limited has chalked out an umbrella branding strategy for `GoodDay’. As a first step in this direction, the company rebranded its Merricake range of small cakes and relaunched the same under the Britannia GoodDay name in January this year. The company plans to further grow the number of product offerings under the GoodDay name. It has already launched GoodDay Plum Cake priced at Rs 35 for a 300 gm pack.
GoodDay is one of Britannia’s stronger sub-brands with a variety of offerings in the cookies segment of the Rs 2,000-crore Indian branded biscuits market. “The decision emanates from consumer research conducted late last year which highlighted tremendous potential for the GoodDay brand equity and its extension possibility to other categories,” says product manager Britannia Industries Limited, Somesh Dayal, commenting on the fresh strategy for the GoodDay sub-brand. The GoodDay basket of small cakes address a variety of price points- including convenient packs priced at Rs 5.00 to larger packs priced at Rs 20. In the future the company will grow the GoodDay basket of goodies with the addition of new products with rich ingredients from time to time. With the GoodDay range of cakes the company is looking at growing the nascent branded cakes market in the country. Only one third of the small cake market is in the organised segment, say analysts. Cakes currently contribute about two per cent to the Britannia’s turnover. The company enjoys a 25 per cent share of the market. The small cake market is however dominated by Monginis with a 40 per cent market share. This despite the fact that Monginis, as opposed to Britannia, is present in Western India only. All Britannia products share the common communication platform of `Eat healthy, think better.’ However, sub-brands have developed distinct values and target audie nces-for example, the NutriChoice range of biscuits which drives heavily from the `health’ plank. GoodDay will hence be positioned on the `source of richness’ platform. Says Dayal,“GoodDay will stand for a brand with
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rich ingredients, offering taste and eating pleasure.” GoodDay offers three variants of cookies in the branded biscuits mar ke t currently. Britannia Industries leads in the Indian branded biscuits market – which are the revenue drivers for the Rs 824 crore company. Rival Parle Foods Limited is currently number two in this market with around 38 per cent market share.
Makeover of Britannia: A Path Less Travelled An old maxim goes, 'Why does something when it ain't broke?' This may be t he credo of most firms, but not of the food major, Britannia Industries Limited (BIL). In 1997, BIL, whose business seemed to be doing well, instead of concentrating on it, virtually charted a new course by see king to reinvent itself. It built a new corporate identity and adopted a colourful and identifiable logo with a new base line - 'Eat Healthy, Think better.' From being a manufacturer of baked products, BIL kicked off a diversification exercise to become a comprehensive foods and beverages company making cheese and other dairy products, in addition to its bakery products.
BIL seemed to be doing something radical by venturing into totally new areas, while this puzzled many, some analysts felt that it was BIL was doing this out of compulsion. They reasoned that the 16% growth rate of BIL sales, which was just 8% in real terms when corrected for inflation, though good by the standards of a mature market, was not good enough for a growing market like India, specially in the foods segment.
Others felt that BIL's makeover decision may have been influenced by the threat of potential competition. They also felt that with the organized biscuit market in India being commodities, and the major chunk being controlled by the unbranded segment, reliance on biscuits alone could be detrimental to its long-term interests.
However, some analysts were of the opinion that the diversification of BIL into relatively new areas was risky, and that it should have concentrated on its core competence, the biscuit business. By the end of 2000 the exploits of BIL seemed to have fructified, at least in the short-run. In a survey conducted by A&M1, BIL emerged as the number one food company well ahead of competitive brands like Nestle and Cadbury. BIL's dairy business seemed to be doing reasonably well. 36
State of Maharashtra v. Britannia Biscuit Co. Ltd. 1995 Supp (2) SCC 72 Facts
The respondents manufactured and sold biscuits in tins. In respect to the biscuits sold in Bombay and its suburbs, the assessee (respondents) charged only for the price of the biscuits. With regards to the tins, the respondents took a refundable deposit (which was 20% more than the actual cost of the tin), with the stipulation that if the tins were returned within a period of three months and in a good condition, the refundable amount would be returned. The assessee however, did not adhere to this, in practice, and accepted tins even after three months. As per its accounting practice the assessee wrote off 50% of the outstanding unrefunded deposit for the assessment year 1967-68 and treated 20% of the deposit amount as profit. The Assessing auth. treated this amount as sale price of unreturned tins and included the same in the taxable turnover of the assessee. Issue: Whether there was an obligation upon the purchaser to return the tins or was it a case where
the return or non-return of the tins lay within the discretion of the purchaser? Judgement
Lower Courts favoured Tax Authority. The assessee’s appeal was dismissed by the First Appellate Authority and the Tribunal. High Court (favoured Assessee) 1.
The HC held that the manner in which accounts are maintained or entries are made in the account is not conclusive of the matter and the true nature of the transaction has to be determined on the basis of the precise arrangement between the parties.
2.
The arrangement between assessee and purchaser was one of bailment and not of sale because of an obligation on the assessee to accept the tins returned and a corresponding obligation on the customer to return the tins.
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Supreme Court Contentions
Appellant 1.
No such obligation (as observed by HC) can be inferred from the endorsement on the price list and invoice of the assessee.
2.
The return of the tin lay within the discretion of the purchaser as even the time-limit was not strictly observed in practice and hence the arrangement was one of sale and not bailment.
Respondent 1.
The tins supplied to the purchasers continued to be the property of the respondents and they were shown as the stock of the respondents in their account books. Therefore, it was a case of bailment and not sale.
2.
The amount written off can be treated at the most as compensation or damages for breach of the obligation lying on the purchaser to return the tins.
3.
There is a difference of approach adopted by Assessing and the First Appellate Auth. and the approach adopted by the tribunal. While the former held that the sale of tins took place when the respondent made the entries in its accounts at the end of the accounting year writing off half the outstanding balance amount, the tribunal understood it as sale of tins along with the biscuits and held that when the tins were returned and the deposit were refunded by the respondent, it was the case of purchase of tins by the respondent.
4.
For constituting the “sale price” as defined by SOGA, there must be a specific sale of goods to a specific buyer and that on the approach adopted by the assessing Auth. and the First Appellate Auth. no such specificity is identifiable and on such ground sale-price can’t be ascertained.
Held (B.P. JEEVAN REDDY)
1.
(w.r.t. 1st observation of the HC) SC concurred to this point and said that court should not be led away by the manner in which the assessee has made entries in its own account but must look to the substance of the transaction and decide what in truth it amounts to.
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2.
(w.r.t 1st issue and 2nd observation of the HC) Neither the endorsement on the price list nor the endorsement on the invoice can be said to create an obligation to return. Also, the time limit was not strictly adhered to.
3.
(w.r.t 1st & 2 nd contention of the respondent) Once it is held that there was no obligation to return the tins the theory of bailment falls to the ground and the said trading receipt can’t be anything but sale price.
4.
(w.r.t the 3rd contention of the respondent) Question which was referred by the tribunal for the opinion of the HC reflect the approach adopted by the Assessing and the First Appellate Auth. rather than the approach adopted by the tribunal.
5.
(w.r.t 4th contention of the respondent) It is unacceptable in the light of the facts that each customer had an account with the respondent and when a particular no. of tins were supplied to a customer, an entry was made to the effect in that customer’s account in the account books of the respondents besides making an entry in the other relevant account books of the respondent.
The transaction relates to s, 24 of the Sale of Goods Act as per which the position of the purchaser, until he returns the good within the prescribed period, is that of a bailee and on the expiry of the said period he becomes a purchaser.
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CHAPTER - 8
CONCLUSION
BRITANNIA Industries has sure come a long way from being a company with a stodgy but wellrecognized brand name and an inconsistent financia l performance in the mid1990s. After a thorough overhaul of the operational structure, a revamp of its product portfolio and an ambitious foray into new areas, such as dairy products and snack foods,the company has managed to turn in robust financial performance over the past four years. BIL has also confounded critics by showing above the industry average growth which has been mainly attributed to its innovative offerings. BIL has consistently launched a new variant almost every quarter. It has pruned its product line and gone to its core products after revitalizing them through state of the art packaging and better visual appeal while at the same time explored new markets such as the rural market.With a strong market share and a steady stream of innovative product launches it is no tilde boast to say that Britannia intends to make every third Indian a Britannia customer by the year 2006.
Opportunity is always knocking, goes a splinter thought of the popular aphorism. The trick is to open the door every time it knocks.It clearly indicates that the price increase of 100-gram Parle-G glucose biscuits is a v ery good oppor tunity fo r Britannia to a chieve its objective of making the company’s Tiger glucose biscuit brands the number one in the glucose biscuit segment. Though the 50 paisa price increase of the 60-year-old 100-gram Parle-G brand seems to be a major price change, it has been found to be very significant for the just 7-year-old Britannia Tiger brand. The research of the company show that the 50-paisa price increase of 100-gram Parle-G brand has really added an appreciable percentage of the glucose biscuit consumers to Britannia’s 100 gram Tiger brand customer segmented also a notable percentage is likely to be added to it. The major reason that has driven Parle-G customers to change their brand was found to be the 50-paisa increase in the price of Parle-G, there by indicating the price sensitivity of the customers.In the case of Parle-G brand, the researcher found that it’s the taste, which contributed towards the customers brand loyalty. Parle-G’s long presence in the market didn’t have much impact on the consumers brand choice, rather it was the taste that deferred customers from switching to the other brands of glucose biscuits.TheParle-G customers are not against consuming the Tiger brand provided they get the same quality taste as that of the Parle-G brand. They pointed out that the Tiger brand has a little lower milky taste and is a little sweeter than it should be. 40
Thus, the company must maintain the price and concentrate on the brand taste to take maximum advantage of this opportunity. Also, marketing efforts are required to make the consumers aware of the brand’s price and make them more of nutrition-conscious so that they can understand the‘Glucose H-Force Biscuit’ concept.
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