Fruit Juice

Project Report On

FRUIT JUICE INDUSTRY

A Project report submitted in partial fulfillment of the requirement of  POST GRADUATE DIPLOMA IN MANAGEMENT IN IV SEMESTER

Submitted to:-

Submitted by:RAVI PRAKASH MAURYA P.G.D.M. 4th Sem 2008-10

India is the second largest for foods and vegetables in the world. The total  production of food and vegetables is estimated to be around 148.5 million tones, tones, out of which fruit fruit account account for only 48.5 48.5 million million tones and the rest 100 million tones is accounted for by vegetables. However, the fruit juice market has not been fully tapped because of poor infrastructure, poor storage facility, and highly unorganized market, chiefly constituted by road side vendors. Consumer still prefer to buy juice from road side vendors even if   juices are unhygienic. Thee majo Th majorr grow growth th driv driver erss in frui fruitt juic juicee mark market et are, are, incr increa ease se in heal health th consciousness among consumers, increase in disposable incomes, and more sophisticated cocktail culture.

Major player and their brands: • • •

Pepsi with its brand Tropicana. Dabur foods with its brand Real. Coca Cola India with its brand Maza.

Parle's Frooti Frooti No 1 fruit fruit drink : Frooti from Parle Agro is the largest distributed fruit drink with 85 % market share in India. It reaches more than 10 lakh retail outlets in up to class C towns through more than 1,500 distributors and wholesalers directly and indirectly. India's first real fruit drink in Tetrapak is available in three delicious varieties - mango, orange and pineapple - Frooti Mango from   premi premium um Indian Indian mangoe mangoes, s, Frooti Frooti Orange Orange from from chille chilled d import imported ed orange orange conc concen entr trat atee from from Braz Brazil il and and Froo Frooti ti Pine Pineap appl plee made made from from ripe ripe juic juicy y  pineapple. The company's another revenue earning brand includes Bisleri

water. The Bisleri brand of mineral water is being made available across the country. It has a market share of 40 %.

Dabur's Real fruit juice in 9 flavours : Dabur's flagship brand Real fruit juice is a market leader in the packaged fruit juice category. Real was launched in 1996 and the brand has carved out a niche for itself  by  by claiming to be the only fruit juice in packaged form that is 100 % preservative free. Real with a market share of 55 % offers to its consum consumers ers the larges largestt range range of 9 juices juices that that compri comprise se orang orange, e, mango, mango,   pineappl pineapple, e, mixed fruit, fruit, grape, guava, guava, tomato, tomato, litchi and cranberr cranberry. y. Real Junior, available in 125 ml packs, targets children below six years. It has two favourite flavours of mango and apple enriched with calcium. Real Activ, a 100 % fruit juice with no added sugar, gives the goodness of fruits without adding extra calories. Today, it is the preferred juice drink for the health and fitness conscious young adults. Real Activ is available in orange, apple, and orange-carrot variants. Real Activ orange carrot juice, India's first  packaged fruit + vegetable juice, is a combination of juicy oranges and sweet carrots. carrots. Coolers, Coolers, a fruit-ba fruit-based sed beverage, beverage, offers tradition traditional al 'cooling' 'cooling' recipes in a ready-to-drink format. It is available in three variants - Aam   panna panna,, pomegr pomegrana anate te (anar (anar)) and waterm watermelo elon n Real Real juices juices are offer offered ed in hygienic double seal spill proof caps in Tetrapak packaging. Once packed, the 6-layer Tetrapak carton helps retain the freshness of the juice for a longer period of time, thus maintaining the taste and nutrition of the juice. The fruits that go into the juices are sourced from the best sources across the world, the company claims. Dabur Food produces around around 50 million litres of juice annually through its state-of-the-art facility at Birganj, Nepal. In

August 2004, the company commissioned a multi fruit processing facility in Sili Siligu guri ri,, in West West Beng Bengal al,, set set up by Pasa Pasade dens nsaa Food Foods, s, a whol wholly ly owne owned d subsidiary of Dabur Foods Ltd. Spread over 11 acres and geared to process 150 tonnes of fruit per day, it has the capacity to produce 192 tonnes of   pulp/concentrate. The plant procures fruits worth Rs 6 crore from West Bengal, North-East, Bihar, Uttar Pradesh, Uttar  Pradesh, Maharashtra and Andhra Pradesh. It has the highest capacity utilization by processing pineapple, litchi, guava, mango and grape round the year.

THE GROWING FRUIT JUICE MARKET: This chance encounter with the wonder plant seabuckthorn was the reason Ladakh Foods was set up as a separate company in 2002 to manufacture and sell seabuckthorn juice as Lehberry. Ladakh Foods today claims to be one of  the the fast fastes estt grow growin ing g frui fruitt juic juicee comp compan anie iess in a fier fierce cely ly comp compet etit itiv ivee envi enviro ronm nmen entt wher wheree big big name namess such such as Dabu Daburr and and Peps Pepsii alre alread ady y ho hold ld subs substa tant ntia iall mark market et shar shares es.. Ev Even en when when the the frui fruitt juic juice/ e/ne nect ctar ar mark market et is  projected to grow at a scorching pace of 40 per cent, a Tetra Pak study has found that a whopping 86 per cent of the fruit juice market is still lying untapped. Perhaps one of the main reasons why milk major Mother Dairy announced it is jumping on to the bandwagon of fruit juice. The company has launched packaged fruit juices under its flagship brand, Safal. Starting from Delhi, the product is scheduled for launched on a nation-wide scale in the months to come. The company says that having pioneered the marketing of fres fresh h and and froz frozen en vege vegeta tabl blee prod produc ucts ts back backed ed by a mode modern rn prod produc ucee

handling and processing facility, Safal is now ready to script a new success story. This time in the packaged fruit juices category. "With the market growing at a healthy rate and with changing lifestyles and rising levels of  health health consci conscious ousnes nesss among among consum consumers ers today, today, the demand demand for health healthier  ier   products like packaged fruit juice is only going to increase in the times to come. The fruit juice category is rapidly growing by over 50 per cent at some stores for us; it's seen as healthy compared to soft drinks. They are more hygienic than roadside fruit juices and are a big hit with yuppies. Also, non-su non -sugar gar varia variants nts find find flavou flavours rs with with fitnes fitnesss freaks freaks.. For For Safal, Safal, with with its expertise in producing and marketing various horticultural products in India as well as overseas, juices are a logical extension of its portfolio. With the launch of Safal juices. A large chunk of this growth will come from the Real  brand of fruit juices, since Real contributes as much as 85 per cent to the company's top line. It will continue to be an area of focus.

Leading Manufacturers of Fruit Beverages in India: Company 1. Parle Agro

2. PepsiCo Ltd.

Brand Frooti

Flavours Mango, Guava, Pineapple, Strawberry & Orange

Appy

Apple

Tropicana

Orange, Nature Sweet, Apple, Grape, Pineapple, Tomato, Mixed Fruit.

Slice

Mango, Litchi, Orange & Guava.

Real

Grape, Guava, Orange, Pineapple, Tomato, Mixed Fruit, Litchi, Mango.

Real Active

Orange, Apple

Jumpin

Orange, Apple

Re

Orange, Apple

5. Coca Cola

Xs Maaza

Orange, Apple Mango

6. BBI. II

Tree Top

Mango

7. Voltas

Volfruit

Mango

8. Hindustan

Grapy

Red Grapes, Litchi, etc.

9. HP Agri

HPMC

Apple Marketing

10. North East Agro Mkt. Ltd. 11. Kerala Milk Mkt.

NERAMAC

Pineapple

Milma

Mango, Pineapple

12. Salstar Foods

Regold

Mango, Apple Mixed

13. Mohan Meakins

Gold Coin

Apple Juice

14. Modern Foods

Rasika

Mango, Guava

15. Eastern Fruit

Efil

Mango, Litchi

16. NAFEED

Nafed

Apple, Mango, Processed Guava, Pineapple, Orange

3. Dabur

4, Godrej Foods

17. Vadilal Industries Ltd. 18. Himgiri Foods

Vadilal

Mango, Pineapple, Orange

Himgiri

Mango, Pineapple, Orange

19. Lakhanpal Foods

VAFA

Mango, Pineapple, Orange

20. WIMCO Ltd.

Sunsip

Tropical Fruits Kioces

21. Tims Products

TIMS

Mango, Pineapple, Orange, Guava

22. BEC foods

ROLZ

Mango, Mixed Fruit Juices

23. The Maharashtra Inds. Development Corp. Ltd.

NOGA

Pineapple Agro.

The above mentioned list consists of the brands noticeable in metros and as such there are a large number of small canning units scattered all over the country catering to niche markets.

Industry analysis: The Rs 100 crore packaged fruit juice market is estimated to be growing at 20% to 25% annually, with Tropicana and Real holding 40% market share each.

The market can be categorized in terms of product content and there are three major product contents available. •

Drinks: Juice with pulp content less than 40%,

•

Nectars: Juice with pulp content between 40 - 80%,

•

Juices: Juice with pulp content more than 80%,

The canned canned juice juice market market initia initially lly covere covered d brand brandss like like NAFED, NAFED, Noga, Noga, Midland, Gold Coin and Druk. These were fruit juices and nectars and not drinks. But they did not make a mark in the market due to reasons such as high price, unattractive packaging and lack of right promotion programme.

Parle Agro’s Frooti, a mango drink, was introduced in the tetra pack in 1985 and since then has been a leader in its segment. The market has suddenly picked up since 1994-95 and a few players have emerged as market leaders

Market Analysis Summary: One can sense an evolution evolution that the industry industry has seen with development development in the tetra- pack market, there also has been a natural progression from drinks to nect nectar arss to juic juices es and and whil whilee trad tradit itio iona nall lly y frui fruitt drin drinks ks were were aime aimed d at children, the new brands like ‘Onjus, Real, and Life’ L ife’ have focused on young adults and professionals.

Although fruit drinks focus strongly on out of home consumption, the juices and nectars have been concentrating on takeaways or in-home consumption with more choice coming in, the tetra- pack market is likely to witness further segmentation.

Packaged fruit juices are getting recognized as social drinks now, with domi do mina nant nt cons consum umpt ptio ion n bein being g ob obse serv rved ed in the the comp compan any y of fami family ly and and friends. People have started to perceive fruit juices as anytime beverages, with with cons consum umpt ptio ion n bein being g spre spread ad more more or less less even evenly ly betw betwee een n the the mid mid

mornings, afternoons and evenings. And generation now is as much inclined to sipping fruit juices as colas, with teenagers driving the maximum trials.

If the findings of a usage and attitude study conducted by market research agency Indica Research across 1200 adults in Sec A and Sec B households in Delhi and Mumbai are anything to go by, then its not just champagnes and colas that qualify as social beverages.

Flushed with funds after selling of its portfolio of soft drink brands, Thumps Up, Limca and Mazza and bottling facilities to Coca-Cola the company has enough cash and this is evident since it has not got listed. It also has a mass massiv ivee dist distri ribu buti tion on netw networ ork k to reac reach h its its end end cons consum umer er.. Besi Beside des, s, the the goodwill of the Parle brand is a great help in its new ventures.

The ‘fresh n juicy’ Frooti brand, is dominating the packaged fruit based drinks category since its launch in 1985. Frooti Mango, which has 75% market share in tetra packs, grew by a modest 4% in 2001 according to ORG-Marg data. Larger pack sizes (1 liter) and more pure juices (such as orange and pineapple) would soon appear under the Frooti brand, taking on the the exis existi ting ng comp compet etit itor orss in thes thesee flav flavou ours rs and and size sizess – bran brands ds such such as Tropicana, Real and Onjus.

Frooti has always been positioned as a drink for kids but now the company is looking forward to position it as a drink for the youth, especially, the college going teenagers. This was the basic rationale behind the Digen Verma Campaign, where a real life, down to earth person, who, like any college student likes to bunk classes, is a good sportsman and is a popular 

figure in the college, with whom the teenagers could actually associate themselves with Digen Verma.

Parle Agro’s product portfolio includes Appy, Frooti and N-Joi (a milk base drink, which are priced at Rs 10. New PET bottles have been introduced in 1 liter and 500 ml for mango Frooti at a price of Rs 28 and Rs 18 respectively. It has recently introduced a green mango flavour in the tetra pack and is also  priced at Rs. 10. Parle Agro’s has an enormous distribution reach of 10 lakh outlets, including leading hotels and restaurants, eateries, super – markets, and paan-shops. Meanwhile, Parle Agro is planning to tap the rural markets with with its its stro strong nges estt bran brand d Froo Frooti ti.. Th Ther eree are are plan planss to set set up a sepa separa rate te distribution in the product itself. In keeping with market sentiments, cola biggies Coca Cola and Pepsi, too, are focusi focusing ng on innova innovatio tion n in their their non non-co -cola la po portf rtfoli olio. o. Coca Coca Cola Cola has launched Maaza in pineapple and orange variants in 125 ml tetra packs and large family packs. It recently started a new facility in Bareilly to cater to the growing demand for Maaza in north and central India. It is learnt that the company is also set to launch some "niche" products. Parle Agro has seen a trend towards fruit-based products. Parle Agro spent Rs 5 crore (Rs 50 million) to relaunched its flagship mango drink, Frooti, with modified packaging and a new ad campaign. It launched a guava drink, Frooti Guava, in Mumbai and other western regions in 65ml packs priced at Rs 2.50. The company is now out with Appy Fizz, an aerated apple drink in champagne-shaped PET bottles. Launched in Bangalore, it is being rolled out in Kolkata and Chennai in 500 ml and 300 ml packs retailing at Rs 25

and Rs 18, respectively. The 60 million case fruit beverage market never had it so good. Of the Rs 7,000-8,000 crore (Rs 70-80 billion) drinks market, fruit beverages account for Rs 500 crore (Rs 5 billion), growing at 25- 30  per cent annually. Like most drinks, summer accounts for 65 per cent of  total sales.

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There has been no general acceptance of the product forms in the fruit  beverage market. The consumer is basically concerned if it is a fruit juice or  synthetically constituted product. Product segmentation, therefore, should be clearly delimited.

•

Under the fruit drinks the first segmentation is between real fruit drinks and synthetic drinks. 

The real fruit drinks are based on natural fruit pulp or juice.



Thee synt Th synthe heti ticc drin drinks ks are are synt synthe heti ticc prod produc ucts ts with with frui fruitt or othe other  r  flavors.

•

Broad Broad taste preference preferencess could could be another way to define the market. market. The market is at present also segmented on the basis of fruit pulp content. For  the purpose of segmentation, on the basis of fruit pulp content. For the  purpose of segmentation, on the basis of fruit pulp content, market can be segmented as:



 Fruit juice with pulp content more than 80%. Brands falling in this

category are Onjus, Real, Tropicana, etc. 

 Fruit Nectar  with pulp content between 40% to *0%. Life and X’s

come in this category.



 Fruit Drinks with pulp content less than 40%. Frooti and Jumpin

are the popular brands in this category.

•

Segmentation could also be on the basis of the benefits provided to the consumer: 

One One bene benefi fitt coul could d be the the nut nutritio rition n content content it giv gives to the the consumer so one market could be the health-conscious segment.

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Second benefit is thirst quenching, so the other segment could be those buying the drink or nectar for satisfying the thirst.

•

Another very broad segmentation can be on the type of situation in which the drink or nectar  is used:



People who are on the move i.e.



People who are using it on the breakfast table as a part of their 

Outdoor use

e.g. those traveling.

menu i.e. in-house use.

Players very often choose one or more of such segmentations to differentiate their product and target market and accordingly plan their distribution and  promotion patterns .

 Target Markets: •

The women of the house

•

Children

•

The teenagers

•

In-home consumption

•

Out of home consumption

The women of the house and children are an important influencing factor in

today today’s ’s scenar scenario. io. As the KiwiJo KiwiJoos os contai contains ns lots lots of health health benefi benefits, ts, the women who care for her family wants her family to be healthy and so are they are targeted.

The children are attracted to the beautiful ads and demand for the products

as they want to experiment things just for the sake of it or for their self  satisfaction. The teens are the most who like to try out new and different products.

Today’s Today’s teens are the most health conscious conscious and put in lots of efforts to be healthy. So even they are an important target audience.

In- home consumption:

This group of people buys fruit juices for home consumption and in many case treated as grocery item and is on the shopping list and forms an important part of their diet.

For an average Indian population juice consumption is seen as a luxury and is a very urban phenomena as people in the urban are getting more and more health conscious and relating and accepting juices as a healthy social drink. These people are typically sophisticated and are exposed to the idea of  healthy living and are concerned of the well being of their families.

Usua Usuall lly y the the lady lady of the the ho hous usee take takess the the bu buyi ying ng deci decisi sion on bu butt she she is infl influe uenc nced ed by her her offs offspr prin ing’ g’ss many many time timess to the the exte extent nt of bran brands ds and and flavours.

One of the strong characteristics features which is common throughout our  target audience is that it is considered that juice is fresh only when it is extracted on the spot for consumption purpose and it is considered to be  better than the packaged ones available in the market. This mind set will have to be changed and the customers will have to be convinced that KiwiJoos is fresh, has all the nourishments intact and is available without the hassle of extraction for consumption.

Out of home consumption:

This consumption pattern is usually observed in people who feel the need to quen qu ench ch thei theirr thir thirst st,, get get refr refres eshe hed d or bo both th.. Th Thes esee type typess of peop people le are are important of KiwiJoos as they are the people who will try the product in small quantity and give us an in road in the home for in home consumption, which is our focus area. If this segment is satisfied then they will start personal use of KiwiJoos and they will also act as a source of mouth - to - mouth publicity, which is considered to be one of the best in its kind.

This segment is challenging one as there is a dual pattern of consumption which mainly exists here i.e. firstly an individual decides if he/she would like to have a fruit juice or a substitute like carbonated soft drinks, water, flavoured milk, etc. then if he/she chooses fruit juice, they have to chose

from the available alternatives then he makes a choice among the available  brands with respect to the perceived value and its cost.

Such type of consumption is usually seen; •

On roads i.e. in front of the general stores, railway stations, bus stands, airports etc.

•

Entertainment zones like amusement parks, cinemas, parks, theaters, etc.

•

Eating-places like restaurants, college canteens, hotels, etc.

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Working Working places places like offices, offices, aerobics classes, gymnasium gymnasiums, s, places places of  worship etc.

The key to serving this segment would be to be available and visible at   poi point ntss of pu purc rcha hase se and and incl includ udin ing g the the pers person on to bu buy, y, with with effe effect ctiv ivel ely y communicating to them that KiwiJoos is a healthy alternative to satisfy the thirst ensuring taste, fun and good health. It is positive that fruit juices are being perceived as anytime beverage. Generation now is as much inclined to sipping fruit juices as colas, with teenagers driving the maximum trials.

•

Amon Among g pack packag aged ed frui fruitt beve bevera rage ges, s, the the ‘awa ‘aware rene ness ss to tria trial, l, rati ratio o of  PepsiCo’s Tropicana juice brand has been rated the highest. Up to 17% of the respondents were aware of Tropicana, while the brand’s trial stood at 11%, also, 8% of the respondents stocked the brand at their homes. Other parameters where Tropicana edged out competitors included taste, health, purity and nutrition, according to the study, Tropicana was also  perceiver as ‘reasonably priced’.

•

The average Indian may have a legendary weakness for mango, but when it comes to preference of fruit-based juices; his choices are in tune with international trends. Therefore Therefore it is orange juice that is the most preferred fruit juice flavour in India, followed by apple, sweet orange and mixed fruit.

•

The findings indicate that most packaged juice drinking consumers travel abroad on holidays.

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Other Other attrib attribut utes es of brande branded d juice juice consum consumers ers includ includee employ employmen mentt of  dome do mest stic ic help help,, owne owners rshi hip p of asse assets ts and and cred credit it card cards, s, and and heal health th consciousness with 80% respondents going to aerobic classes or working out at gymnasiums.

•

Understandably therefore, awareness and trial levels of packaged juices are higher within the Sec A category, than among Sec B consumers, the majority of whom rated these as aspirational.

•

Awareness levels are similar in both Mumbai and Delhi; more trials are generated by Delhities than their counterparts in Mumbai.

•

The consumers are starting to perceive fruit juices at home. While 55% of the respondents consumed 1- litre packs at home, 45% consumed 200ml packs.

The fruit beverage market has more acceptances in Northern and Western India, which is due to the climatic conditions prevailing there with relations to the rest of the country.

Present status: Tropical fruits and flavours dominate the market, yet some consumers are still hesitant to try unknown exotic flavours like cherimoya, guanabana and carambola. Companies have found the best way to introduce exotics is in combination with familiar flavours. A flavour combination that began in the new age, 5% to 10% juice category, and has spread to other beverage categories as well as to other products like kiwi, strawberry, etc. stating that it was a small company that took the risk and won.

Smaller companies lead the way, as they are more willing to try exotic flavours even though the larger companies have a larger staff and budget, and and can can affo afford rd to sear search ch ou outt the the tren trends ds.. Th Thee larg largee comp compan anie iess tend tend to introduce prototypes that are pretty well-tested. They are always interested in the next flavour trend, but usually are not the first to debut it.

Fortified drinks are also gaining market i.e. the juice is processed and an additional nutritious trait is added to enhance its wholesome value e.g. with additional calcium, vitamin C etc.

One can notice the population in the country mainly in the cities becoming more and more aware with regard to the nutritional aspect of life. This knowledge, coupled with the consumer’s desire for a healthier lifestyle, has greatly impacted the evolution of juice and juice-based drinks over the last few years.

Sales Analysis: Can Dabur Real Foods put more juice in the juice market? The company which has turned fruit juices into a Rs 60-crore (Rs 600 million) business has been turning on the taps in recent months -- and it hasn't been afraid to innovate. It's heading off in untested directions by launching a new range called Coolers, which includes traditional recipes like  Aam Ka Panna (a green mango drink). It has also launched a pomegranate juice and a watermelon drink. A jamun variant will soon follow. Or, look at Pepsi Foods that has recently launched Tropics, a new range of  what are called nectars in the fruit juice business. Pepsi has started out with a relatively unadventurous mango flavour but it will soon be putting guava and litchi on the shelves. If that's not enough, Pepsi Foods is also aiming at customers with more exotic tastes with an orange-apple combination and a tropical fruit fusion drink (a mix of mango, guava, pineapple, orange and apple juices). Dabur and Pepsi Foods aren't the only companies that are moving into overdrive in the juice business. As Indians take bigger swigs than ever   before of packaged juices a slew of companies are hoping to grab a share of  the action.

The result is that players like Dabur Foods, Pepsi Foods, Godrej Industries' Foods Division, Mother Dairy and even the small Ladakh Foods are betting  big money on this market by flooding it with new fruit beverages. "It's a huge market with its potential still to be tapped," says Sanjay Sharma, head of marketing at Dabur Foods. The resu The result ltss are are on show show to anyo anyone ne who who step stepss into into a neig neighb hbou ourh rhoo ood d supermarket. There are now racks filled with fruit juices, nectars and drinks (the difference lies in the pulp content -- juices are 100 per cent while drinks are below 20 per cent and nectars fall in between). The swift growth in the market is attracting newcomers like Mother Dairy, whic which h rece recent ntly ly laun launch ched ed the the Safa Safall bran brand d of juic juices es.. Safa Safall is curr curren entl tly y available in orange, mixed fruit, grape and an orange-apple combination. Ladakh Foods, makers of the Leh Berry seabuckthorn berry drink, has now also launched an apple-peach combination juice and a mixed fruit variant. Even Godrej Industries Foods Division has introduced fruit juices under the Xs brand (which earlier only consisted of nectars) and a soya milk fruit juice  based drink called Sofit this year. Parle Agro -- of Frooti and N-joi fame -too is rumoured to be on the verge of new launches. To add to the buzz, players are now looking at different pack sizes and price  points. New entrants are also expected to join the fray in the Rs 500-crore (Rs 5 billion) organised fruit beverage market (nectars, drinks and juices combined). One newcomer is likely to be Ahmedabad-based Pioma Industries -- makers of the Rasna brand of soft drink concentrates, which test marketed a diluted mang mango o juic juicee in Andh Andhra ra Prad Prades esh, h, bu butt drop droppe ped d the the laun launch ch plan plan afte afterr a lacklustre response. Industry experts predict that the company may try again either this year or the next. What's making all these players gung-ho about fruit beverages? For one, the fruit drink market (juice accounts for 30 per cent, nectar is 10 per cent and fruit drinks are 60 per cent of the market today) has grown at a 20 per cent to 25 per cent rate. Of this, the more expensive juices segment has grown at a 40 per cent rate this year. It accounted for only 15 per cent of the fruit beverage market three years back. Says Jagdeep Kapoor, chairman and managing director, Samsika Marketing Consultants, "Consumer habits have changed drastically. They

are looking for healthier options and nutritional value in the food they buy today." Obviously, some segments are doing better than others. Fruit-based milk  drinks {market size Rs 20 crore to Rs 25 crore (Rs 200-250 million)} like  N-joi are currently stagnating. But fruit-based soya milk, another emerging segment reckoned to be worth about Rs 15 crore (Rs 150 million) to Rs 20 crore is expected to grow rapidly. Godrej, which recently launched the Sofit brand, is experimenting with this market for the second time. Ten years back, its soya milk brand Great Shakes failed miserably because of its taste. But it's not just the health fad that has led to the growth spurt. Cola sales fell dramatically after the pesticide controversy and this seems to have benefited the fruit beverage industry. Soft carbonated drinks (colas) grew 17 per cent in 2002 but fell 15 per cent in 2003.

Fruit juice in growth IT'S a tale with a delicious twist. Compact International promoter D. K. Mittal was to meet the Director of the Defence Research and Development Organisation (DRDO) one fine morning in Ladakh in connection with a tender for setting up some shelters for army personnel. During the meeting, the Director offered Mittal a drink made of an unheard of herb called seabuckthorn. A little sceptical at first, Mittal took several sips before gulping down the entire glass. And he asked for more.

This chance encounter with the wonder plant sea buckthorn was the reason Ladakh Foods was set up as a separate company in 2002 to manufacture and sell seabuckthorn juice as Lehberry. Ladakh Foods today claims to be one of  the fastest growing fruit juice companies in a fiercely competitive environment where big names such as Dabur and Pepsi already hold substantial market shares. Says Managing Director Varun Kumar, "Even when the fruit juice/nectar market is projected to grow at a scorching pace of  40 per cent, a Tetra Pak study has found that a whopping 86 per cent of the fruit juice market is still lying untapped."

Perhaps one of the main reasons why milk major Mother Dairy last week  announced it is jumping on to the bandwagon of fruit juice. The company has launched packaged fruit juices under its flagship brand, Safal. Starting from Delhi, the product is scheduled for launched on a nation-wide scale in the months to come. The company says that having pioneered the marketing of fresh and frozen vegetable products backed by a modern produce handling and processing facility, Safal is now ready to script a new success story. This time in the packaged fruit juices category. "With the market growing at a healthy rate and with changing lifestyles and rising levels of  health consciousness among consumers today, the demand for healthier   products like packaged fruit juice is only going to increase in the times to come." Says the director of a top retail chain in Chennai, "The fruit juice category is rapidly growing by over 50 per cent at some stores for us; it's seen as healthy compared to soft drinks. They are more hygienic than roadside fruit juices and are a big hit with yuppies. Also, non-sugar variants find favour with fitness freaks."

For Safal, with its expertise in producing and marketing various horticultural  products in India as well as overseas, juices are a logical extension of its  portfolio. With the launch of Safal juices, our intention is to grow the juice market further by providing a great-tasting product to the consumer at the right value," says Paul Thachil, Chief Executive of Mother Dairy. Ask  Dabur Foods CEO Amit Burman where he thinks his company will be in the next few years and pat comes the reply: "We will be a Rs 200-crore company by 2006-07. And a large chunk of this growth will come from the Real brand of fruit juices, since Real contributes as much as 85 per cent to the company's topline. It will continue to be an area of focus."

However, realising that the fruit juice category, though growing at a healthy  pace, needs to be activated further, Burman has just launched fruit drinks -

drinks where the fruit pulp concentration is only about 20 per cent - in typically Indian flavours of aam panna, watermelon and pomegranate. And having realised that price is still an entry barrier for a vast majority of the consumers, Dabur has priced Coolers about 15 per cent lower than Real. Pricing is one of the major worries. Says Executive Director (New Business) at Pepsi Foods, Subroto Chattopadhyay, "Price is a barrier to this category  because when you give fresh juice, packaging becomes critical. So, what the industry is now trying to do is offer different packaging to suit different  price points while simultaneously working on ways to offer better quality and improved taste."

Pricing is also the downfall of fruit juice importers. Says A. V. Bhaskar, CEO, Adluri Foods, which distributes the Australian brand Berri in the South, "It is difficult to make inroads into the middle class as it finds the  prices prohibitive. Sales tax on imported products is not uniform across the States. In Tamil Nadu, it is 21 per cent, much lesser in Andhra Pradesh and Karnataka." So a one-litre bottle of Berri costs Rs 110 while a Tropicana T ropicana is in the Rs 75 range. PET bottles are another reason for the high prices. However, the retail prices are the same across all the States. Natural fruit  juices are a growing market and all players should have a level playing field, he says. Taking advantage of the health consciousness pervading the market, Adluri Foods has introduced cranberry juice (something that the local brands also have done) and is testing a mixed vegetable juice and a cocktail of apple, carrot and orange in the market. Pepsi recently launched Tropicana Tropics Mango Nectar, which is made entirely from mangoes sourced from within India, as against other flavours for which sourcing has to be done from other countries. The introduction of  Tropics Mango Nectar will be followed by Tropics Litchi and Tropics Guava. Says Chattopadhyay: "India is now among the top ten markets for  Tropicana worldwide. Significantly Significantly India is now an approved source for 

mango pulp within the Tropicana worldwide system, and can soon emerge as a major sourcing base for other exotic fruits for Tropicana's international market." Which means that if the fruit juice producers work on further  development of backward linkages, the pricing issue plaguing this industry can be better tackled. Besides, the industry has already begun to offer   packaging solutions to address different price points like a 125 ml pack of  fruit drink Maaza from Coca-Cola India at just Rs 5 and a 500 ml Tropicana  blend for Rs 25. So where is the industry headed? Says Varun Kumar of Ladkah Foods: "We expect the market to touch Rs 170 crore by next year and we are targeting  break-even within the next four years." So, while it took Dabur Foods seven years to make money on fruit juices, thanks to product innovation, expanding market and increased consumer preference for healthy foods, Ladakh Foods may repeat this feat in just four years. But even as the industry players are upbeat about growth prospects, there is an undercurrent of discomfiture, with talk of the new government thinking of levying eight  per cent excise on food products including packaged fruit juice. So, while  profit projections are unlikely to go completely haywire just yet, there might have to be some readjustments in the time frame within which these targets may be achieved. Substitute:

Fruit juice companies have to face a two level competition i.e. on the first level with the substitutes and the then the players within the industry. The ‘sip war’ is comprised of the following players with respect to India.

•

Soft Drinks (both carbonated and Non- carbonated soft drinks)

Soft Drinks are divided into carbonated and Non- carbonated drinks. While Cola, lemon and oranges are carbonated drinks mango drinks come Noncarbonated category.

•

Flavoured Milk (energy, N-Joy etc.)

Just Just like like frui fruitt drin drinks ks Flav Flavou oure red d milk milk is also also po posi siti tion oned ed on the the heal health th   platform. Companies are trying to project it as a fun drink with added flavours and innovative packaging.

•

Mineral Water

Frui Fruitt drin drink k sell seller erss cons consid ider er even even mine minera rall wate waterr as subs substi titu tute te to thei their  r  offerings. The main assumption is that packs ensure quality delivery.

•

Other products

Milk by- products like buttermilk and lassi also serve as major substitutes. They compete in terms of low price as well as easy availability. These drinks are also considered important from the health perspective.

Main Competitors: A host of brands are jostling for thirst space. Not just colas but beverages and fruit juices of all hues are adorning shop shelves. From bottled iced-tea to branded chhaas, fruit-based drinks and flavoured milk, beverage makers have gone berserk with product innovation as new variants continue to flood the market. Fruit drinks are high on the swig list in summers as it is part of the health fad sweepi sweeping ng the nation nation.. Health Health consci conscious ous consum consumers ers are increa increasin singly gly givi giving ng aera aerate ted d drin drinks ks the the go by and and maki making ng a beel beelin inee for for frui fruitt-ba base sed d concoctions. Moreover, sporadic controversies about pesticide-infested cola drinks are said to be driving consumers towards fruit-based drinks as a safer 

alternative. That is why even existing players are going all out to pour out new flavours.

Dabur: Dabur Foods that was set up in 1997 has brands like Hommade, Lemoneez and Capsico in its basket. The Rs. 37 crore Dabur Foods ltd, a wholly owned subsidiary of Dabur India ltd ahs two brands of juice in the market, they are; •

Real

•

Real Active

For its Real brand, Dabur is focusing on increasing in home consumption by targeting mothers and children. It is priced in the range of Rs. 60 to 65 [1 liter] and Rs 15 [200ml] except for Guava that is sold in the range to Rs 65 to 70 and Grape that is sold for Rs. 70 to 75. Its ingredients are water, fruit concentrate, sugar, citric acid and flavours of; •

Grape Grape,, Guava, Guava, Orange Orange,, Pineap Pineapple ple,, tomato tomato,, Mixed Mixed Fruit, Fruit, Litchi Litchi and Mango.

The Real Active brand is targeted towards fitness- crazy young consumers. The drink is positioned on the health plank. It was launched towards the end of 2002. At the same time, the company plans to position Real Active as its  premium juice brand, while Real would be targeted at consumers belonging to socio economic categories B and C also. It contains only fruit concentrate and water. It is priced at Rs. 68 and 70. It is available in the Flavours of; •

Apple and orange.

The company was eyeing a turnover of Rs. 60 crore in the year 2001 -02, which is an increase of nearly 50%. According to the company it ahs seen a growth of 44% in the financial year 2001-02 as compared to 34% in 200001. The company plans to increase the advertising spends for the brand by nearly 40%. Today the advertising and marketing budget for the brand by near nearly ly Rs 8 Cror Crore. e. Th Thee comp compan any’ y’ss thru thrust st is on incr increa easi sing ng in-h in-hom omee consumption therefore they are mainly targeting the mothers and children.

However, the company has restricted its activities in the urban areas only and wishes to fully consolidate markets in the cities before looking at the small towns and rural areas Dabur Foods claims to be the market leader in the pure juice category such as Punjab, Delhi, Haryana, etc.

PepsiCo: The Pepsi operations in India are now the part of the new Asian division of  Peps PepsiC iCo o Beve Bevera rage gess Inte Intern rnat atio iona nall form formed ed by the the merg merger er of Peps PepsiC iCol olaa Inte Intern rnat atio iona nal, l, Trop Tropic ican anaa and and Gato Gatora rade de,, the the spor sports ts beve bevera rage ge comp compan any y acquired from Quaker Oates. Earlier, India was one of the eight business divis ivisio ion n of the beve everag rage com compan pany that that used sed to rep report to Peps epsiCo iCo International in New York directly. Now it reports to PepsiCo Beverage Inter Internat nation ional al Asia Asia in Hong Hong Kong. Kong. PepsiC PepsiCo o Bevera Beverage ge Intern Internati ationa onall is a division of PepsiCo Inc. This move has been prompted by the need to give greater regional focus to new products like Tropicana and Gatorade so that they become a key element of the overall portfolio of the US beverage major.

PepsiCo Inc. is one of the world’s largest food and beverage companies. The company’s principle businesses include: •

Frito – Lay snacks

•

Pepsi-Cola beverages

•

Gatorade sports drinks

•

Tropicana juices

•

Quaker Foods

Pepsi India is already working on a strategy to launch a bevy of Gatorade  products in the country by the end of this year. These are as follows: •

Gatorade Thirst Quencher 

•

Gatorade Nutrition Shake

•

Gatorade Energy Drink 

•

Propel Fitness Water 

•

Gatorade Energy Bar 

It is also planning to give a major thrust to the juice business through the launch of a host of new products under the Tropicana brand name i.e. on the health and energy platform. PepsiCo has so far invested around Rs. 100 Crore Crore inn ready to drink juice segment segment where where the company has two brands brands Tropicana & Slice. It has 14 plants in India producing fruit juices & 2 of  them work on tetra pack.

Tropicana: Tropicana entered the country in 1998. Tropicana is currently imported in a concentrated form, which is later reconstructed at a plant in Baramati, near  Pune and vacuum packed into tetra packs after paying an import duty. It

covers around 18 cities of India. The factor of its success is that it has a tigh tightl tly y cont contro roll lled ed dist distri ribu buti tion on syst system em on top top of an equa equall lly y cont contro roll lled ed  production and this in turn helps it keep its taste constant and the company  boasts of it too.

Tropic Tropicana ana Bevera Beverage ge Co. recent recently ly announ announced ced the compan company’s y’s inclin inclinati ation on towards bringing in an entire series of juices and other health drinks from its international portfolio into India in the coming years. The Tropicana brand,  per se, has been positioned on the ‘health’ platform.

Pepsi also plans to give its juice brand – which has seen many hurdles in the nascent and niche juice market – a renewed thrust in the coming days. A  price revision of the brands is also on the anvil.

Since 2001, Tropicana roped in celebrities in the field of nutrition and health to sell its brands. Under which they got renowned people in the field of  health to recommend their clients to use their brand. The list of names included the likes of Anjali Mukherji, Sabina Sehgal Saikia and Vandana Luth Lu thra ra,, who who prom promot otee the the bran brand, d, po posi siti tion oned ed as a heal health th drin drink, k, to thei their  r  upwardly mobile clientele. Even celebrity doctors and pharmacists were included in its list of marketers. Tropicana is also sold through various health clubs like Talwalkars, Personal Point, etc. in Mumbai and Delhi. In the past as a part of its promotional activities, the company had conducted a ‘Tropicana Health Run’ in the capital, slated for World Health Day, which was was on Apri Aprill 7, 20 2001 01.. Trop Tropic ican anaa also also runs runs a prog progra ramm mmee call called ed ‘The ‘The Tropicana Club’ under which every time one buys a pack of Tropicana he earns points which he can collect and exchange for a wide range of gifts and

also, also, as a member member he gets gets unique unique offer offers, s, exciti exciting ng gifts gifts and interest interesting ing information on keeping fit and looking good.

The company is seen to intensify its distribution network, with a greater  thru thrust st on larg largee inst instit itut utio ions ns.. Apar Apartt from from reta retail il and and cons consum umer er – leve levell  promotions, Tropicana is being promoted through health bulletins and health leaflets. The company intends to continue with its ‘unconventional’ retail thru thrust st.. Apar Apartt from from the the 20 20,0 ,000 00 to 25 25,0 ,000 00 ou outl tlet etss acro across ss 18 citi cities es that that Tropicana has a presence in, the brand is being placed across gymnasiums, fitness centers in 5-star hotels, coffee shops, airlines, hospitals, offices and heal health th stor stores es.. Th Thes esee po poin ints ts of cons consum umpt ptio ion n are are no nott cons conseq eque uent ntia iall in  providing high volumes, but important from the imagery point of view. Typically, non-retail stores have been contributing 12 – 15 % of the brands sales. Tropicana evokes a high brand loyalty among health – conscious middle and upper-middle class segments. The company is seeking to project itself on the health platform and has an ad spend of around 20% of its sales.

The brand’s existing tagline of ‘Taste of Good Health’ has now got an extension statement of ‘Don’t forget the juice’, ‘Tropicana 100% pure fruit  juice’. Tropicana is packaged in a 200 ml slim pack [which replaces its 250 ml pack] and 1-liter in a flat pack tetra pack. The company is seen to run  promotions in coordination with its other offering like a scheme where 16 gm pack of Lays Magic Masala that comes free with a 200 ml pack of  Tropicana. Worldwide, Tropicana has a host of juice brands under its belt. Brands like Twister, Dole, Looza, Fruvita and Juice Bowl, which could find their way into the Indian market in the coming years. It has decided to make changes in the composition of its juices to suit the Indian taste buds. For 

instance, realizing that Indians like a sweet flavour, it decided to launch a separate sweet orange juice product specifically for the Indian market. Since it could not dilute its juice content, it decided to substitute part of it with grape juice to make it sweeter. Even it’s launched tomato and mixed fruit  juices have been altered to suit the Indian palate.

Currently, in terms of market share, Tropicana is believed to trail behind rival Real (Dabur) but is not far behind and also has close to 40% market share of the estimated Rs 100 crore branded juice market.

Pepsi sets the pace for backward integration of Tropicana, as a first step toward towardss backwa backward rd integr integrati ation on for its pure pure juice juice busine business ss Tropic Tropicana ana is foray foraying ing into into contac contactt farmi farming ng of citrus citrus fruits fruits like like orang oranges es and Keanu. Keanu. Punjab- Jallowal – has been chosen as the location for the project. The 3  phase project involving trials, nursery and contract farming, is being pursued  jointly by Pepsi and the Punjab Agro Export Corporation. Through in its infancy at the moment, the project vision however is of about seven years. If  successful, it would mean 100% localization of orange juice and it becoming the supply center to other regions.

A present Tropicana has the following flavours: Orange, Nature Sweet, Apple, Grape, Pineapple, Tomato, Mixed Fruit.

Slice: PepsiCo in 2002 poised to make deep inroads into juice drink segment in India with seven new variants of its ‘Slice’ brand. For the first time in

company’s history, a ‘Litchi’ variant of Slice was introduced. Apart from that, a guava and Orange flavours was also being offered. Apart from 200 ml slim line cartons priced at Rs 10 each, Slice juice drinks is subsequently made available in 250 ml returnable glass bottles as well.

The company invested significantly to bolster the Slice brand in the year  2002 20 02 and and plan planss to inve invest st heav heavil ily y thro throug ugh h the the year year whil whilee Slic Slicee is no now w available in litchi, orange, mango and Guava flavours, they are expected to  be soon joined by Slice Cocktails.

PepsiCo is sourcing litchis from Muzaffarpur, guavas from Karnataka and Allahabad, and mangoes from Ratnagiri.

Marketing Mix: Marketing mix comprises of approaches to price, distribution, advertising and promotion.

Pricing: Pricing is one of the major worries. Price is a barrier to this category  because when you give fresh juice, packaging becomes critical. So, what the industry is now trying to do is offer different packaging to suit different

 price points while simultaneously working on ways to offer better quality and improved taste. Pricing is also the downfall of fruit juice importers, which distributes the Australian brand Berri in the South, "It is difficult to make inroads into the middle class as it finds the prices prohibitive. Sales tax on imported products is not uniform across the States. In Tamil Nadu, it is 21 per cent, much lesser in Andhra Pradesh and Karnataka. So a one-litre  bottle of Berri costs Rs 110 while a Tropicana is in the Rs 75 range. PET  bottles are another reason for the high prices. However, the retail prices are the same across all the States. Natural fruit juices are a growing market and all players should have a level playing field. Taking advantage of the health consciousness pervading the market, Adluri Foods has introduced cranberry  juice (something that the local brands also have done) and is testing a mixed vegetable juice and a cocktail of apple, carrot and orange in the market. Pepsi recently launched Tropicana Tropics Mango Nectar, which is made entirely from mangoes sourced from within India, as against other flavours for which sourcing has to be done from other countries. The introduction of  Tropic Tropicss Mango Mango Nectar Nectar will will be follow followed ed by Tropic Tropicss Litchi Litchi and Tropic Tropicss Guava. India is now among the top ten markets for Tropicana worldwide. Significantly India is now an approved source for mango pulp within the Tropicana worldwide system, and can soon emerge as a major sourcing base for other exotic fruits for Tropicana's international market.Which means that if the fruit fruit juice juice produ producer cerss work work on furthe furtherr develo developme pment nt of backwa backward rd linkag linkages, es, the pricin pricing g issue issue plagui plaguing ng this this indust industry ry can be better better tackle tackled. d. Besides, the industry has already begun to offer packaging solutions to address different price points like a 125 ml pack of fruit drink Maaza from Coca-Cola India at just Rs 5 and a 500 ml Tropicana blend for Rs 25.

So where is the industry headed? It is expected that the market will touch Rs 170 crore by next year and we are targeting break-even within the next next four years. years. So, while while it took Dabur Dabur Foods Foods seven years years to make money on fruit juices, thanks to product innovation, expanding market and increased consumer preference for healthy foods, Ladakh Foods may repeat this feat in just four years. But even as the industry players are upbeat about growth prospects, there is an undercurrent of discomfiture, with talk of the new government thinking of levying eight per cent excise on food products including packaged fruit juice. So, while profit projections are unlikely to go completely haywire just yet, there might have to be some readjustments in the time frame frame within which which these targets targets may be achieved. achieved. With people people turning more health conscious, the non-carbonated beverage segment has   become one of the fastest growing and most exciting businesses at the moment. For some time now, manufacturers have experimented with some of the formulation and taste issues, offering the consumers better tasting, more healthful alternatives. Evolving from drinks containing a hint of herbs or vitami vitamins, ns, bevera beverages ges have have become become an import important ant delive delivery ry vehicl vehiclee for  effica efficacio cious us amount amountss of nutrit nutrition ional al ingred ingredien ients. ts. Bevera Beverages ges are unu unusua suall  products in that everyone expects to try new varieties, even from established  brands.

Price Price is the market marketing ing mix elemen elementt that that produc produces es revenu revenues, es, the other otherss  produce costs and it is also one of the most flexible elements as it can be changed quickly, unlike product features and channel commitments. India is known as a price sensitive market i.e. an Indian customer wants more value at low price.

The company’s objectives with regards to pricing is to survive the resistance from the existing players, maximize profits and increase its market share in the five cities it is catering.

KiwiJoos’s pricing will be a premium pricing. As we are targeting the sec A and sec B of the middle class and also the Elite class the price must be affordable to consumers. Consumers are ready to shell out little extra money for the exotic and classic drink that has many health benefits. Even though we are are cate cateri ring ng on only ly on onee flav flavou ourr init initia iall lly y the the pric pricin ing g is clos closee to the the competitors pricing.

KiwiJoos will be priced as follows:

250 ml – Rs.30 01 liter – Rs. 90 1.2 liter – Rs. 130 02 liter – Rs. 180 05 liter - Rs.400

Distribution: The distribution or reach factor is a marketing mix element that needs to be monitored over a period of time. Unlike product improvement or positioning strategies that are extremely sensitive to consumer preferences and changes, distribution inertia could dawn on the company over a period of time. An attempt to link distribution with the changing environment will ensure that a great deal of slow damage is averted. As consumer behaviour changes,

competition picks up and the product moves through its life cycle, new channels may have to be considered, evaluated and chosen.

The company Shreeji Enterprises Pvt. Ltd has its KiwiJoos manufacturing and packaging plant in Nasik. The Kiwi fruits will be imported from New Zealand based company Zespri International Limited.

The company will be moving in the first phases i.e. the first year we will have an aim of entering only few major cities of India and establishing our   brand with Kiwi flavour which will be seen as a launch-pad for our other  offerings i.e. flavours. The initial launch will be in the following cities:

•

Chennai

•

Bangalore

•

Delhi

•

Mumbai, Pune and Nasik 

•

Kolkata

The transp transport ortati ation on to the cities cities will will be basica basically lly throug through h rail rail and road road depending on cost effectiveness. The inventory level will be decided with resp respec ectt to the the seas season on and and in coor coordi dina nati tion on with with the the dist distri ribu buto torr and and the the comp compan any y repr repres esen enta tati tive ves. s. Th Thee comp compan any y will will have have its its repr repres esen enta tati tive vess  positioned at each city that will coordinate with the distributors and the company will interact with the retailer’s inorder to ensure the company first hand information about the product with relation to the customers. There

will be 5 representatives stationed at each city who will have to make 40 calls a day in their respective territories.

To keep the channel active and result oriented following initial steps will be taken; •

They will be given discounts on cash purchases.

•

The goods will be available on credit basis also.

Reta Retail iler erss have have to be segm segmen ente ted d base based d on Volu Volume me,, excl exclus usiv iven enes ess, s, complemen complementary tary products products handled handled and basic requirem requirement ent of refriger refrigeratio ation n facilities, which is a must for our product. These factors will be given consideration before incentive schemes are worked out.

KiwiJoos will be marketed through different channels. All different sizes will be available at places where buyer buys products in greater volume;

•

Supermarkets

•

Discount stores like Big Bazaar, Apna bazaar, etc.

•

Hyper Mall

•

Petrol pumps

•

Chemists, General and Convenience stores

•

Health clubs, Gym, Gymkhanas etc.

•

Entertainment zone: Theaters, Cinemas, Parks, Amusement parks, Game Parlours etc.

•

Ice-cream Parlours

•

Hotels & Restaurants

•

Bakeries

In certain areas such stores may not exist so in these areas the bottles will be availa available ble at specif specific ic stores stores at the discr discreti etion on of the repres represent entati atives ves and distributors, these stores should be able to serve the basic idea.

The effectiveness of our channel will only be known when we assess our  chosen channel on the following criteria:

•

Are the customers expectation been met by us?

•

Are the channels serving the targeted segments?

•

Are our intermediaries motivated?

Distribution patterns: Distribution network and reach are vital factors for success of the brands in the fruit beverage market. It is mainly the distribution strategy that the companies are focusing upon.

The distribution is mainly done through stockist. The companies also have franchises that work as a separate entity. Some companies also have their C & F agents to give the product to the distributors, who further distribute to the retail retailers ers.. To co-ord co-ordina inate te the things things proper properly ly with with the distri distribut butor ors, s, companies keep their own field force.

Below the figure shows the many ways the companies in this industry are seen to be operating:

Company’s Manufacturing Facilities

Franchises

Stockist

Agent

Distributor 

Retailer 

End User 

The urban Indian retail sector has traditionally been structured around three small retail entities—the grocer, the general store and the chemist.

•

The grocer stocks non packaged, unbranded commodities such as rice, flour, and pulses, as well as branded fast moving consumer goods (FMCGs)

•

The general store stocks only branded, packaged FMCGs.

•

The chemist, a part from dispensing pharmaceuticals products, sells  branded FMCGs such as personal care products and health foods.

•

Departmental stores and supermarkets.

•

Others: 

Bakeries and confectioners



Fruit juice/ tea stall/ vending machines



Ice-cream parlours,



Electrical and hardware stores and



 Non-food boutiques, etc.

These retail outfits stock branded FMCGs that gel with their businesses.

Supply chain integration does not quite matter in the case of the small retailer because of the small scale of his operations. He normally deals directly with wholesalers with whom he is able to negotiate rates. Retail consolidation (consolidation of buying power) among supermarket operators is unlikely to hurt small retailers simply because it will affect manufacturers directly, who will not want to compromise on the distribution reach to offer large volumes to a few big retailers.

The small retailers form an integral part of the wide distribution network set up by the large FMCG companies. Marketers have also found that private/ store brands from supermarkets can prove to be a threat to their own brands and hence, desist from encouraging retail consolidation.

Marketing Strategy:

Marketing Summary:

Pursuant to our company policy stating "Quality First, Credit Prominent", we process our KiwiJoos with strict production standard, quality control and sophisticated processing technology, we at all time provide our consumers the natural and healthy Kiwifruit juice. KiwiJoos is a new flavour in the market and the company is also new so its marketing budget cannot be limited. So the strategy will be to enter the market with a big bang. Developing visibility and brand equity is the key. KiwiJoos will be advertised in different media with respect to our target market i.e. the women of the house and children who are an important influencing factor in today’s scenario. The teens are the most who like to try outt new ou new and and diff differ eren entt prod produc ucts ts so even even they they are are an impo import rtan antt targ target et audience. In addition to the advertisements which will be used to drive consumer  sales, KiwiJoos will leverage a networking campaign with respect to the dist distri ribu buto tors rs and and sale sale prom promot otio ion n at the the po poin ints ts of pu purc rcha hase se i.e. i.e. loca locall restaurants, gyms etc. to drive commercial sales. KiwiJoos will be on the shelf in all markets by 15 th February, the company will start supplying its stock by 6 th February. The promotional activities will start from 12 th February.

Mission: The mission is to provide the highest quality of fruit juices. We exist to attract and maintain customers. When we adhere to this maxim, everything else will fall into place. We will ensure that our products will exceed the

expectations of our customers i.e. we develop a competitively superior value  proposition and value- delivery system.

Marketing Objective: •

Maintain positive and steady growth each month.

•

Experience an increase in new customers i.e. we have to ensure that our    products have a high trial rate which will help us to turn these new customers into long term customers.

•

Generate brand equity at the markets we are catering to as well as within the supplier and distribution networks.

Promotional Strategy:

The promotional efforts will be on two fronts i.e. on our direct customers and and the the end end cons consum umer ers. s. Th This is shou should ld ensu ensure re Kiwi KiwiJo Joos os a pu push sh from from the the distribution and a pull from the customers.

All All ou ourr prom promot otio iona nall effo effort rtss shou should ld serv servee some some basi basicc crit criter eria ia like like the the activities should carry a feel good appeal and should enhance emotional attachment of the target with KiwiJoos.

KiwiJoos will be advertised in cost effective media like newspapers, radios, hoard hoarding ings, s, at bus stands stands,, and the most most impor importan tantt and effectiv effectivee will will be through TV advertisements. There will be some cosmetic variations of these adve advert rtis isem emen ents ts when when they they are are laun launch ched ed acro across ss the the coun countr try. y. Regi Region onal al celebrities who appeal to consumers may also be used in advertisements intended for various regions these celebrities will represent our positioning.

Sales Promotion: We will be tying up with few other marketers and piggy backing our product on theirs; this is expected to give us access to the shopping list and homes of  our target. Marketers that we intend to tie up with will be the ones that have a place in the shopping list of the lady of the house e.g. branded wheat, salt, frozen vegetables, magazines etc.

The company will also tie up with supermarkets and other stores, which are mainly volume oriented, by piggy backing our product on their in-house  products. Both the above routes will help us in sampling our products to our  target customers and in the right manner. Attention will be given to the presentation part too, POP materials, store displays, stickers etc. will be used to create awareness at the retail outlet.

Advertising: Advertising will be exercised with a media mix, which will consist of:

•

Print Media:

Print Media will be used in the form of news papers of various languages. Print media will be mainly used with a purpose of communicating and comp compli lime ment ntin ing g ou ourr sale saless prom promot otio ion n sche scheme mess to pu purs rsue ue and and give givess us visibility.

•

Audiovisuals:

Television as a media will be used to inform the qualities and benefits of  Kiwi KiwiJo Joos os and and give give us visi visibi bili lity ty and and bu buil ild d the the bran brand d imag imagee with with the the custom customers ers.. The combin combinati ations ons of TV channe channels ls will will be used used at diffe differen rentt intervals. The channels will be selected keeping in mind our target i.e. the lady of the house – channels showing good TRP ratings for their soaps; the influencers i.e. her offspring – music, movie channels, cartoons, etc.

•

Audio:

Radio will be a key element in our media mix as it is cost effective and will cover our catering cities precisely. Under the brand name we will be running contests, sponsoring programme, etc. This will help us reach out to our  target audience and the influencers.

•

Outdoor:

Outdoor communication will be done to help us get the visibility i.e. with the help of Hoardings, which will be placed at areas that are prone to traffic  jams and at toll Stations. Railway stations in Mumbai will be a good target

area for such print media as it also has maximum visibility because majority  people travel daily by trains to work. In respect of this media the company will be very selective.

•

Posters:

Posters will be created by the company during the events and will be carrying the company logo, brand name and the picture and the tag line.

•

Public Relation:

The company will be a part of events and/or will also be organizing its own events. The events will be chosen on the core values of community relation and whole family participation. The company will be a part of children and youth involving events like college/ school festivals, meets, etc and only use these as a platform to getting closer to their influencers and sample their   product at a concession or commission basis.

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World Wide Web:

We will make our presence felt on the internet by hosting a website for the  brand KiwiJoos which will be named “www.kiwijoos.com” “www.kiwijoos.com” which will; 

Thee webs Th websit itee will will be impa impart rtin ing g the the info inform rmat atio ion n abou aboutt ou our  r   products, quality and values i.e. history of kiwi, its cultivation, its benefits etc.

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Run online contests

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Give health tips

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Give recipes

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Opinion section - person is free to express his thoughts and feedbacks

The website will be a tool to get closer to our customers and understand them better and will serve an entertainment and utility value.

CONSUMERS PURCHASING BEHAVIOUR :

The availability of consumer food products in India has grown significantly since the economic reforms beginning in 1991. Indian consumers can now  purchase domestically produced cheese, wine, potato chips, ketchup, soft drinks, candy bars, breakfast cereals, ice cream, donuts, biscuits, frozen meats and vegetables, instant noodles, jams and jellies, packaged grains and  pulses, soups and some ready to eat packaged and frozen meals. Availability of fresh produce is seasonal. Retail food sales in India were approximately $132 billion in fiscal year 1998 and are growing at 13 percent per year, according to the Ministry of Finance. The retail market for fruits and vegetables has grown at over 20 percent per year in the past few years. Retail sales of subsistence foods such as cereals, breads, pulses and edible oils have started declining. As incomes have risen, there has been a shift in consumption, from subsistence to higher value foods. Many Indians are vegetarian by tradition; moreover, many can only afford a vegetarian diet. Meat may be regularly consumed by less than 30 percent of 

the Indian population, due to its higher cost and a predominance of  vegetarianism and Hinduism. However, only 20 percent of the population is strictly vegetarian. Non-vegetarians Non-vegetarians typically consume meat only once or  twice per week. Higher income consumers rely almost entirely on domestic help for their shopping. The domestic help buys staples, vegetables, and fresh foods from local small grocers and vendors, and other products from a variety of general merchants. The middle class has diverse purchasing habits. Many families on the upper end use part-time domestic help to do their shopping, often necessitated by a growing pattern of households with two working parents. Many families at the lower end of the middle class continue to do their own shopping. The poorer segments of the Indian  population tend to buy basic staples with the first part of their paychecks, which typically are distributed on the first few days of each month. During the month, the poorer customers will buy whatever fresh foods and consumer goods they can afford, often filling in at the end of the month with some additional staples purchased on credit. In all classes, women do most of the shopping and make most of the food purchase decisions. Most consumers prefer local shops to larger supermarkets because of proximity,  personal attention, and lower prices. Nearly 95 percent of consumers  purchase fresh fruits and vegetables from a local market or street vendor. Additionally, traditional markets are considered the freshest source for  foods. Indians have a strong preference for freshly freshly prepared foods, and most have a definite prejudice against packaged, branded, or processed foods, believing them to be lower in flavor and nutrients. Many households will not even reheat foods, and make only enough for one meal. This is mainly to avoid waste, but also to ensure freshness since refrigeration is

available only in wealthier households. However, with urbanization, rising incomes, more working women, the arrival of large food multinationals, and a proliferation of fast food outlets, acceptance of packaged food products is increasing. Packaging of imported goods is typically better than that of  domestic goods. Also, India India has many regional regional differences differences in food tastes and preferences. For example, residents of Mumbai (formerly known as Bombay) are more willing to try new foods than those in other Indian cities. As Mumbai is home to a more progressive and skilled labor force than other   parts of India, many multinational corporations test market new products in that city. Consumer spending has grown at an average of more than 11.5% a year for more than decade as in most developing nations, a large chunk of  Indians consumer expenditure is on basic necessities, especially food-related items. Hence it is not surprising that food ,beverages and tobacco account for as much as 50% of consumption expenditure in 2006.the remaining 50% related to non-food items is expected to rise, due to the growth of percapita income. There are three significant trends in Indian retailing. First, the number of  small outlets has grown over the past few years, bucking the worldwide trend toward retail consolidation. Second, Indian retailers have started  promoting brands and using basic merchandising techniques. Some of these stores are even charging slotting fees for shelf space. This is in stark contrast to the small shopkeepers who paid personal attention to regular customers and strongly influenced their buying decisions. The shopkeeper’s recommendation was important because he often did not display all the items he stocked. Indian consumers who choose branded foods are less likely to seek the shopkeeper’s recommendation. recommendation. Lastly, retailers have also started offering home delivery services in urban areas.

CONSUMERS DEMAND FOR FRUIT JUICES : As from the above analysis it if found that the 78% consumers consume fruit  juices and they are aware about it but the apparent side says 18% consumers who are aware of fruit juices like Real,Tropicana,Leh Berry, Jumpin, N-Joi  but not aware about the other fruit juices in the market because of their less demand. The demand for fruit juices increases because of the growing income of each individual and increase in purchasing capacity. The change in consumption food habit has really affected the demand of fruit juices. The  brand name which ha s great influence towards sales. Most of the people says that real is the best brand and they will go for real. Lesser people then real want to go for Tropicana and subsequently the demand decreases among jumpin and N-Joi . The various campaigns organized by the fruit  juice companies have also increased the consumption demand for fruit  juices. It is obtained from the primary research that 65% of consumers  prefer Real juice as compared to Tropicana, Leh Berry, Jumpin and N-joi. It is also observed that n-joi has lesser consumers attracted towards it shows the lesser demand by consumers according to the various parameters which are explained in the other other analysis as follows. According to the demand of the product by the consumers the producers increase their   production by keeping in eye the past demand and competitors demand in the prevailing market. Leh Berry and Tropicana has the same demand in the market because of their retail price in the market for which the consumers  buy it. The promotional factor which as great importance towards the demand of the fruit juices.

Consumption and buying Patterns: Thee Indi Th Indian an life lifest styl ylee has has a trad tradit itio iona nall pred predil ilec ecti tion on for for fres fresh h frui fruits ts and and vegetables or those processed at home. People go in for fresh fruits vending from kiosk fountains, which produce instant juices from fresh fruits in the  presence of the consumer.

One One reas reason on is the the un unav avai aila labi bili lity ty of hy hygi gien enic ical ally ly prod produc uced ed and and well well- preserved products with the use of preservatives. The fact that it is packed denies its freshness. This was also a reason why some of the real but   branded fruit juices launched in the late 1980’s and early 1990’s did not succeed.

Tast Tastee is ofte often n the the seco second ndar ary y cons consid ider erat atio ion n in the the Indi Indian an mark market et for  for   beverages. Fruit juices also lose on roughage, which is an important part of  fruit nutrition. Few people know the difference between a juice and nectar.

In general, the Indian consumers have become health conscious now and are looking for healthy and natural appetizing juices. They are moving away from synthetic drinks to natural and wholesome fruit juices. At present;

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Per capita consumption of juices in India is estimated at a fraction of a litre i.e. 200ml.

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The consumption of fruit juices in take home packs is estimated at 17250 mnlt.

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Consumers go for convenient and economy products. 

So small packs are well suited for travelers and children and large take home packs for families and price conscious people.

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Availability in chilled form and brand awareness plays a crucial role in  purchase decision. 

This has implications for the need for availability of the product and in the right form.

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While there is no aversion to consumption of fruit beverages by any group, the main consumers of this market are people in the age group of  30 and below. 

Young Young adult adult and teenag teenagers ers predo predomin minant antly ly consum consumee tetra tetra pack  pack  drinks.

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Brand loyalty is very low, as all the products taste the same. 

But brand loyalty is high in case of kids. ▫

Though there is a lot of difference between brand awareness and brand loyalty. Consumers are money conscious where the purchase of 

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fruit beverages is concern. Consumers are not ready to explore the market.

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They do not want to change their taste and are stuck to their old  brands.

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Orange and other drinks are slowly picking up and breaking the loyalty towards old brands.

Product adaptation:

A recent article in The Economist reveals that savvy retailers have made a number of breakthroughs when it comes to the science of persuading people to buy. Their discoveries provide fascinating food for thought for online marketers too… U.K. based Sainsbury’s is probably one of the leaders when it comes to understanding and taking advantage of buyer psychology and consumer   behavior. Sainsbury’s has, for example, identified the area outside its supermarkets as a ‘decompression zone’ where people need to transition into a ‘buying mode’ before they’re ready to buy. As such, Sainsbury’s doesn’t bank on  people buying the crates of discounted goods located in this area, but uses such promotions to help ‘warm’ people to buying. Then, after someone makes it through the ‘decompression zone’ Sainsbury’s  presents shoppers with the choice of browsing through magazines, books and DVDs in the ‘chill zone’ – an area designed to tempt consumers and slow them down – or continue on to the fruit and vegetables area. Why are shoppers immediately channelled into the fruit and vegetables section? Because buying wholesome, fresh food gives them a good vibe and helps remove any guilt they may later feel when confronted by less wholesome items! Supermarkets such as Sainsbury’s also use a host of other techniques to keep  people in their stores for longer. This is based on evidence that the longer  shoppers stay in-store, the more they’ll buy. Although not mentioned in The Economist article, it’s certainly no surprise that smart supermarkets avoid displaying clocks on their walls. Like casinos, supermarkets have learned that when people lose track of time, they tend to take longer… and spend more money. Another example of supermarkets aiming to delay shoppers and tempt them with more items, is placing everyday goods, such as milk, at the back of the store. The idea is to force people to walk through the aisles so they may be tempted by other products as they walk to and from such sections.

Of course, you may already know about this tactic… but did you also know that supermarkets purposely place popular items halfway along the aisle to force shoppers to take longer (and face more temptations) to reach them? Such tactics reflect retailers’ greater understanding of consumer behavior. Among other things, they have derived this greater understanding from utilising such devices as the humble mobile phone. In one application of mobile phone technology, U.K. based Path Intelligence tracked people’s phones at Gunwharf Quays, a large retail and leisure centre in Portsmouth.  No, Path Intelligence didn’t eavesdrop on people’s conversations. Instead, they tracked where people were, and how long they spent there, based on the locations of their mobile telephone handsets. These handsets could be located due to their transmissions to cellular networks. And the study confirmed the idea that the more time people spend in store, the more they buy: when shoppers’ ‘dwell’ time increased by 1 percent… sales rose by 1.3 percent. Supermarkets are also using security cameras to track peoples actions in their stores. By implementing such technologies they have been able to derive such information as the age and gender of customers, as well as their   buying habits in relation to certain kinds of products. More on that below. Another tactic used by modern supermarkets is to have an in-store bakery. Quite apart from selling baked goods, in-store bakeries are designed to  produce the aroma of freshly baked bread. This tends to make people feel hungry and motivate them to buy not only bread, but also other food. Indeed, while most advertising is based on visual stimuli, retailers are increasingly investigating the impact of sound, smell and touch on buyer   behaviour.

SWOT Analysis:

Strengths: •

Innovative flavour hence we are bound to get the attention with proper  communication.

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Committed, capable and ambitious management.

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We can gain incentives as we will be a SSI and so we can pass these to capture more market.

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Flexibility in our operations as initially we will be confined to few cities so can focus our efforts on the tasks.

Weakness: •

Our distribution set up initially will be weak when compared to the others in the market.

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a frui fruitt is new new in the the mark market et and and no nott all all peop people le take take the the risk risk of  experimenting with taste.

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We are entering the market with only one flavour and our next flavour  will be out only after six months of the first launch.

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Our financial constraints with respect to our competitors demand that our  resources are used optimally.

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We will not be able to price our product lower than the others in the marke markett as we have have a longer longer distri distribut bution ion channe channell and managi managing ng this this chan channe nell also also will will be an impo import rtan antt task task.. Also Also as ou ourr prod produc uctt is no nott available in India its cost of acquiring increases and therefore it cannot  be sold at a low price in the initial stage.

Opportunity:

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The market is in a growing stage and fairly small in terms of market share as compared to other thirst quenching and healthy drinks so at this stage our entry is expected to be noticed.

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The market has a presence of only few players and they are not too aggressive in their acts.

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More and more people in the urban areas are getting health conscious and are making fruit juice a part of their daily diet. Hence the market is growing.

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Thee go Th gove vern rnme ment nt po poli lici cies es are are expe expect cted ed and and are are show showin ing g tren trends ds to encourage the food processing industry.

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The fruit fruit can be then cultivat cultivated ed in India India in the regions regions of Himachal Himachal Pradesh, Uttranchal Pradesh, Sikkim, Arunanchal Pradesh, Meghalaya, Jammu and Kashmir and Nilgiri Hill, to cut down the cost of imports of  the fruit.

Threat:

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Our competitors are deep pocketed and they could harm us by getting aggressive in their promotional activities.

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The competitors have strong brand images in the market because of their  other businesses and their presence in the market from an early stage.

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Indian market has characteristic of serving a wide variety people which is a challenge for all the marketers.

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Others can adopt the flavour and the value of a unique flavour could be neutralized soon.

Conclusion: India is a tropical country and has accorded a favorable reception to thirst quenchers such as fruit juices and aerated drinks. Ready to serve kiwi juice is a beverage prepared from clarified kiwi juice. When chilled the RTS  beverage makes for a nutritious and refreshing drink. The nutritive value of  real fruit beverages is far greater than that of synthetic products, which are  being bottled and sold in large quantities throughout the country. If real fruit  juices could be substituted for these synthetic preparations, it would be a  boon to the consumer as well as the fruit grower. India is a market of diversity – diverse with regards to incomes, price points of products, culture and preferences and a marketer has to get use to these diverse characteristics of the market. Drinking juice is not a part of our culture. We drink water with our meals  but in the West one starts the day with breakfast and a glass of juice. Juice is to a great extent considered as a luxury not a necessity in our society, surely  but slowly things are changing mainly in the urban and semi urban areas, where the population is getting more and more health conscious and are realizing the important nutrient values of fruit and are making them a part of  their daily diet. The companies in this Rs. 100 crore industry will have to organize various  promotional activities from time to time mainly to increase sampling and to educate the consumers about packaged fruit juice that it is as pure and nutritious as fresh juice which is perceived as fresh as it is extracted in their   presence i.e. actual or assumed.

Ther Th eree are are two two main main bran brands ds in this this segm segmen entt of no nonn- carb carbon onat ated ed drin drink  k  markets; they are ‘Real’ from Dabur and ‘Tropicana’ from PepsiCo. These two players command around 80% market share in the organised sector. We can observe this industry growing and new players entering the market. In recent times we have seen the entries of some international brands, like Berri [Australia], Ballantyne [Australia], and Tipco [Thailand], with the intention to strengthen their hold in India and to grow with the market.

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Supply distribution should improve in the area.

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The company should work in their companies regarding to the cooler  and stabilizer.

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Company should give proper schemes to the outlet.

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The Refrigerator purity should have the priority.

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Overall service should be improved for getting more sale and to be the market leader.

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The sales executives should try to avoid making false commitments releasing short term goals.

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 Number of hording should be increased. Florescent board displaying location and their distances on road should be used having written on them.

This study gives a clear idea regarding consumer behavour while purchasing. The strategy for the products products can be changed by comparing comparing the different different factors that has obtained from the study. Real has obtained the highest market share by keeping keeping in consider consideratio ation n the paramet parameters ers like consum consumer er feedbac feedback, k, packagin packaging, g, deliver delivery y mode, mode, quantity quantity and availab availabilit ility. y. The other other brands brands have have less market share because they don’t have the strategy like Real to capture the market. Tropicana is very near in every aspect to real and by changing the strategy like availability and promotional activities it can cross the market share of Real very easily. The price of Tropicana is affordable and has more number of customers whos whose e prof profes essi sion on is stud studen entt and and fall falls s betw betwee een n the the age age grou group p 20-3 20-30. 0.so so,, Tropicana can do some promotional activities where they can capture other age group so that their market share will increase. The other three brands Leh-Berry, Jumpin and N-joi has less market share because of the quality and the type of  packaging they made for sale. The packaging of real is satisfactory. So, they can change the packaging style more advance tetra pack models so that they can have huge market share. It is also observed that flavour has great role for  attracting consumers. The flavour of some fruit juices are artificial which really doesn’t attract customers during their second or third time purchase so without adding adding artifici artificial al flavours flavours natural natural flavour flavour will work more more strongly strongly for attracti attracting ng cons consum umers ers.. To alloc allocat ate e the the targe targett consu consume mers rs is the impo importa rtant nt work work for the producers so that they can match their product nature withy the preferences of  the consumer who are more willing to buy fruit juices. Now day’s consumers are more attracted towards the modes of delivery so the modes of delivery can be chan change ged d by alter alternat nate e modes modes of deliv delivery ery like like home home deliv delivery ery and and deliv delivery ery by auto automa mati tic c mach machin ines es so that that they they can can get get fres fresh h juic juices es whic which h chan change ge the the psychology of customers a lot as analyzed from this study and questionnaire. As the price of Leh Berry, N-Joi and Jumpin is affordable it attracts the all income

level of consumers, but the real has the price which does not attract all level of  consumers so alternatively to get more share he has to reduce the profit margin with less margin. The number of consumers fall in the middle class level so it is very nessery retain those level of consumers who have dense population in India. The urban areas mostly keen to adapt those sophisticated products due to the social social perce percepti ptions ons.s .soc ocill illly ly it can be mark markete eted d by consid consideri ering ng the the socia sociall activities like festival. The wrong notion among the people is that fruit juices are only only good for athlete athletes s but but that that can be change changed d by campaig campaigns ns..

So before before

lunching a new fruit juice brand in market the parameters which have taken into consideration must be utilized for better consumer attraction.