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CDL (Chaudhry Dairy Limited) is one of the reputable and renowned

company in Pakistan. CDL was established in 1984 as a private limited

company. The company came up with its first doing product “Haleeb

Milk” and later on it continued to expand its product line. In 1988, CDL

introduced “Haleeb Cream” which was not only launched directly for

consumer market but also supplied to many ice cream factories where it

was used as a core ingredient. The company has its head office in Lahore

and a plant is located 65-km from Lahore in Bhai Pheru. The plant is

equipped with latest equipment and technology, specialized workers

scientists and professionals who assures quality at every level of

production process.

The dairy industry in Pakistan is very competitive. There are large

number of players including multinational and local companies which

potrays an oligoplistic market structure without product differentiation.

In such an cumulative and challenging marketing environment the

strategic management of CDL has been able to maintain its dominant

image in the market. The company has already awarded ISO-9000 in

1997 for its strict quality control operational systems. Currently, the

plant is running with the capacity utilization rate of 90%.


CDL has the prime corporate mission of achieving and maintaining high

quality. But in broader term its mission statement states the following;

• Providing nutrition’s and hygienically processed food products to

our customers at competitive price.

• Enhancing our reputation for quality in all our operations.

• Promoting mutual trust with customers, suppliers, employees and


• Providing a safe and healthy environment to our community.


The product line of CDL includes the following products;

• Haleeb standardized milk

• Haleeb cream

• Asli Desi Ghee

• Candia milk

• Skimz liquid skimmed milk

• Skimz – skimmed milk powder

• Candia drinking yogurt


Candia is a product of CDL which was launched first time on April 12,

1999. Candia is basically a French brand and it is processed and packed

under licensed by CDL. Candia is already a very popular brand in

Europe and other 52 countries.

Now it is available across Pakistan including all the major cities through

CDL distribution channels. It is very unique in its packing and features.

It is packed in plastic bottles of two different sizes, 0.5 litre and 1 litre.

The plastic it contains consists of three layers. The outer and inner layer

is white in color and compose of same formulation of high density

polyethylene. The middle layer is black in color which protects the milk

from heat and light. As far as the packaging is concern, Candia has no

competitor in local market.

CDL invested around 200 million rupees to launch Candia in Pakistan.

Out of which 10 – 15 million was only spent on the massive advertising

campaign carried out in world cup season at the time of launch.


The method of collection of milk for Candia is through the approved

suppliers who maintain cattle in accordance to the prescribed standards.

Then the milk is tested in laboratory by conducting 8 different tests. The

milk is received in the chiller containers and heated upto 8%. After that

the milk is transported to the factory for processing.

The processing of Candia milk undergoes through 6 different stages.

Firstly, fresh milk is pasteurized. Then it goes from the stage where it is

standardized and homogenized. After homogenization the milk is heated

at 140 oC, ultra high temperature (UHT) for about 4 seconds and then its

goes for aseptic packaging. After packaging milk is sterilized and send

to the channels of distribution. One bottle of Candia contains 3.5% of fat

and 8.9 SNF.


Marketing orientation strategy was adopted by CDL towards launching

Candia. In the marketing orientation stage company identify what

customers want and tailor all of the activities of the firm to satisfy those

needs as efficiently as possible.

Lease features of marketing orientation strategy adopted by CDL


• The product launch was preceded by market research and need


• Pull strategy was adopted because market potential was already

identified since UHT (Ultra High Temp) sales were increasing.

• The product was made by keeping in view the customers need,

rather than producing it and then trying and push sales, as in a

selling strategy.

For the want satisfying ability of the product, the company specifically

aims at image utility which is the emotional or psychological value that a

person attached to the product or brand because of its reputation or

social standing. However, the image utility of Candia varies

considerably depending on different consumer’s perception.



As we know that the successful marketing depends largely on company’s

ability to manage its marketing programs with in its environment. The

following macro and micro environmental factors played a considerable

role on CDL marketing opportunities and activities. The external macro

environmental factors which can influence on Candia’s sales are:

1. Demographics

Demographics refers to the characteristics of human population,

size, its distribution and growth. The total population of Pakistan

is 140 million and it is growing at the rate of 2.5%.

There is more potential for Candia’s sales because the population

growth rate is favorable and increasing.

Changing gender roles is another demographic factor which refers

to the changing roles of males and females related to families,

buying patterns etc. The females in Pakistani society are now more

aware of brands. Their attitudes forward careers, shopping, and

products have entirely changed. If more and more women are

educated in the society. There is a likelihood that they become

more skeptical towards. Shopping especially for house hold items.

In addition to this more people are migrating from rural to urban

areas, which also favour Candia’s sales because Candia is not

much distributed in rural areas. Similarly the people’s attitude

towards fitness is perception gradually increasing which enhances

their to switch on milk consumption.

2. Economic Conditions

The following economic conditions which can effect the marketing

activities for Candia are:

Business Cycle

The business cycle consists of four stages, prosperity, recession,

depression and recovery. Currently, the overall business industry

in Pakistan is passing through a stage of recession but it is hoped

that it will enter the recovery stage soon, which will be favorable

for company’s long term pricing objectives.


When Candia was launched, the inflation rte in the country was,

6.5% officially as compared to the last years inflation rate of 8.3%.


As far as the battled milk is concerned Candia has no competition

in the local market. But as the core product is concerned, there is a

substitute threat. Many other companies including multinational

are also fulfilling the demand for UHT milk.

3. Socio / Culture Changes

Todays society is becoming more complex because our Socio

cultural patterns, life styles, values, beliefs are changing much

more quickly. Here are few changes in social and cultural forces

that have significant marketing implications for Candia.

Consumers awareness about UHT milk has increased so much as

result of massive advertising campaign carried out by Tetra Pak

association of Pakistan. People have changed their views about

fresh milk. They feel that fresh dairy milk is impure and

unhygienic, and it contains bacterias which causes infectious

diseases. Moreover, there is a popular notion among the mass

consumers that dairy milk contains high percentage of water as

compared to milk itself, which is a routine practice being

undertaken by the “Ghawalas”. So mostly the consumers

especially in urban areas are switching towards tetra Pak UHT

milk which is more hygienic and durable in use.

4. Political / Legal Forces

The political and legal forces which effected CDL marketing

efforts for the launch of Candia were the environmental anti

pollution laws, according to which a company is prohibited to use

that plastic packaging which is not recyclable. Candia has a

special “USP” Packaging which is recyclable and environmental

friendly. Also the milk processing plant of Candia is located 65

kilometers out side the main city of Lahore near Bhai Pheru which

is a desirable step according to the requirements of the law to

avoid air pollution.

5. Technology

Technological break through have a tremendous effect on the life

style, consumption patterns and behavior patterns of the people.

The technology introduced by CDL for Candia is plastic bottle

packaging which is also unique selling point because there is no

other local company providing such packaging. More over the

plastic which CDL is using is USP, packaging which is

internationally recognized frequently used by competing brands all

over the world.

communication of decision oriented information to be used in all phases

of the marketing process.

Candia also carried out a comprehensive marketing research program to

deal with the competitive pressure already exists in the market. The

sources of information used to conduct this market research includes the


• Internal company information

• Dealers information

As regards the customers needs are concerned, both formal and informal

investigation methods were used. Regarding formal method, a

comprehensive market survey was conducted in which people from

different walks of life were interviewed personally and their responses

were collectively evaluated.

Telephonic and direct mail survey systems were totally ignored to get

feed back of consumer’s response.


The market is a group of customers (people or organizations) for whom a

seller designs a particular marketing mix. The primary market which

CDL targeted before launching was specifically urban sector. Their was

no ultimate consumer as no age limitations were specified for the



CDL divided the total market into smaller segments with a prospect to

enhance effective acceptance and sales of the Candia. The following

segmentation basis were applied.

1. Geographic Segmentation

As concerns a geographic segmentation, CDL has segmented its

potential market in all the four provinces simultaneously which is

further subdivided in key business centers located in these areas.

As far as the residing areas are concern CDL has specifically

segment its market in the urban sector.

2. Demographic Segmentation

In terms of demographic segmentation, CDL has divided the

market. On the basis of income, family size and style:

• The target consumers of Candia core high income

people with income regarding from Rs. 10,000 and above.

• In terms of age, there is no segmentation undertaken

by CDL. As a product appeals all the age groups.

• The segmentation basis by gender includes both male

and female for Candia’s target market.

• On the basis of social class, Candia has segmented the

market considering only upper and upper middle class.

• Candia has also segmented the market on the basis of

family life cycle, with a distinction between single and

married class.

• As regards education, there is not segmentation basis

applies as it appeals to bit of common sense.

3. Behavioral Segmentation

In terms of behavioral segmentation, CDL has divided the market

on the basis of benefit desires from the product and its usage rate.

• As regards the benefits desired from the product, CDL

has segmented the market on the basis of quality and taste.

• There is not segmentation basis undertaken by CDL as

regards the usage rate of the product, which ranges from non

user to heavy user.


CDL has segmented the business market on the basis of customer

location and type. The Co has selected both single and multiple buying


• As a segmentation basis by location

• The Avg. business order unprocessed milk is considerable large in

size therefore, the company has segmented. The order size on the

basis of sales volume.

• The company orders the unprocessed milk from the unorganized

dairy industry.

• Co’s can approach buy in different ways. Some companies have

their own purchasing department. In CDL, the decision of

purchase are normally undertaken by consulting all the purchase

staff members.

• The purchase criteria is segmented strictly on the basis of quality.


The target markets should be compatible with the organization’s goals

and image and also consistent with definition of strategic planning.

CDL has adopted market aggregation strategy as a single segment. The

strategy used can also be called mass market strategy.

The management of CDL has developed on marketing mix and reach

most of the customer in the entire market. Candia is offered as a single

product for the mass audience. It has one pricing structure, one

distribution system and it uses single promotional program which also

aimed for the entire market.


CDL designed a complete marketing mix for Candia which includes it

price, promotion, placement and product management.


A product may be a good, service, person or any idea. Candia is a

commodity which is offered to the consumers to fulfill their needs.

It is a processed milk which is treated with UHT technology. It is a

in liquid form, whit in color and packed in plastic bottles which

are available in two sizes.

Core Part

The core part of Candia milk is that, it is a complete food

supplement which includes all the vitamins, proteins and lactic

acid, which are needed for good health and vitality.


Candia milk is classified as a “Convenience Good” because

consumer can buy it any time with a minimum effort. The category

in which Candia falls in the “Replacement Product” because it is

significantly different from the Tetra Pak milk already available in

the market. Candia is the only milk which is sterilized after



In business analysis, CDL had gone into the details of terms and

conditions of franchising. After one year negotiations, CDL was

permitted to produce Candia in Pakistan as a subsidiary company

of French Candia. The finances were arranged and the feasibility

reports were made which estimated the cost of the whole project

including manufacturing plant, patent, distributions etc. So the

whole program to develop the product in home country was

designed and analyzed.


Ad discussed in the earlier part of the report market tests for

Candia milk were being carried out in Lahore do test whether

people will actually going to buy it or not. In these tests, sale and

repeat buying behavior of the consumers was monitored.


After having the successful results of test marketing, CDL finally

decided to start full scale production and developing market plans

for Candia. Candia was produced and first launched on 12 th April

1999 with a massive advertising campaign.


. The positioning strategy chosen for Candia milk was

“Positioning is relative to a product class or attribute”. The attribute on

which CDL has positioned Candia “taste’. Candia has a very different

taste among all the available branches in the market, that is whey it is

primarily positioned on its distinctive taste is the result of the process of



Management of CDL is aware of the fact that every product has its own

life cycle and product is to be treated accordingly, depending on the

particular life cycle stage. The product life cycle goes through four

different stages. There are introduction stage, growth stage, maturity

stage and decline stage.

Candia was introduced 8 months back. It has successfully crossed its

introduction stage and according to the management of CDL, Candia has

now entered into growth stage where it experiences the target of market

acceptance, higher sales and higher profits. The company is managing

the growth stage by using the strategy of market penetration.


Branding and packaging are the two actual parts of the product. Brand

name identifies the product,, it makes shopping easier and ensure the

quality to differentiate the product from competitors. The brand name of

the product here is “Candia”. It is the separate name used for the product

without using the corporate name which is CDL. Although the branding

is under corporate name (CDL) but CDL is not used combined with

brand name. Among the five levels of brand familiarity, Candia is at the

“Brand Recognition” level. People recognizes the brand and every body

knows about its existence.

As far as the packaging is concerned, CDL is following “family

packaging strategy’, in which the bottles of Candia are placed in one

container. Packaging includes all the details about the product. In

Candia’s case, the primary packaging is the plastic bottle of white color

with a lid on its opening. This primary packaging is used to protect the

milk from heat and light. This plastic bottle is the USP Packaging which

is save and environmental friendly. The secondary packaging for Candia

consists of 12 bottle pack which is wrapped in a card board box covered

with plastic sheet.


Labeling consists of all the information about brand, brand mark, name

of company ingredients, expiry date an instructions. Labeling is

considered as a part of packaging to give full details regarding the

product. Labeling of Candia includes a picture which shows, a morning

time at a form and “milk” in written also in a very attractive manner.


The pricing objective which CDL selected for Candia was purely “profit

oriented”. And the rationale was to achieve the target return. The target

return could be away specified percentage return on the sales on Candia

milk. The company has concealed all its profit and sales figures because

it is a private limited company and do not disclose its annual reports to

general public.

Regarding pricing strategies, CDL chosen “Market Penetration Policy”

for Candia. Following this strategy, the price of Candia is kept, low in

relation to the target markets range of expected prices. The aim of using

this strategy is to penetrate the mass market immediately and to increase

the total sales volume.


Currently there are no discounts offered for consumers and wholesalers.

The every discounts offered were the trade discounts, which were given

to retailers at the time of launch of Candia.

As regards the geographic pricing strategy is concerned, Candia is

following a “Uniformed Delivered Pricing” strategy, which is to charge

same price to all retailers around the country. Moreover “One Pricing

Strategy” is also being adopted which enables consumers to purchase

Candia at one price, no matter how much quantity he / she buys. The

following table shows the existing prices for Candia.

Bottle Size 1 Liter (1 bottle) 12 Liter (12 bottles)

Trade price Rs. 28 Rs. 336
Retail Rs. 30 Rs. 360
Bottle size 0.5 Liter (1 bottle) 6 Liter (12 bottles)
Trade price Rs. 14 Rs. 168

Retail Rs. 15 Rs. 180

As concerned to the basic price setting approach, Candia adopted

“Customer Base Pricing” which means that the price of Candia is

according to the purchasing power of customer. Since the target market

belong to higher income group, so it means that price is higher than

other brands.


The chained of distribution adopted for Candia is:

Company Distributor



The rationale behind selecting this kind of a distribution channel was

that, if serves large number of retailers spread all over the country who

paid it economical and feasible. The company has only one warehouse

situated in Bhai Pheru from where this distribution takes place. CDL has

appointed 35 distributors all over Pakistan for effective and on time

availability of Candia. This distribution is said to be an “Intensive

Distribution” where CDL is trying to deliver its product to every retail

outlet in urban areas.


Candia is a new product, so the objective is to aware and inform people

about its distinctive features. The promotional mix for Candia includes,

advertising, sales promotions and public relations.


Advertising gives the feel of the product. It is an impersonal

communication that the sponsor has paid for and in which the sponsor is

clearly identified. Candia is advertised through different channels.

1. Television

Television has contributed lot in the promotion of Candia. At the

time of launch, CDL invested around Rs. 10 – 15 million one

television ads. Their ad is of 12 second duration which appears

quite oftenlty on both of the local channels.

2. Newspapers

CDL has advertise Candia milk in all reputed news papers of the

country like, Nation, Dawn, The News and Daily Jang.

3. Sign Boards

Sign boards and billboards are also playing an important role in

the promotion of Candia. Candia’s neon signs can also be

observed on some of the eye catching locations of the city.


There is demand stimulating activities designed to supplement

advertising. The major sales promotion activity carried out for Candia

was sponsorship is typically viewed as a long range image building


CDL has also carried out public relationing to build a favorable image

for an organization. The management developed good public relations

with the players of Pakistan relations with the players of Pakistan

Cricket team by giving them cash prizes through out the cricket world

cup 1999.


A promotional program directed primarily at end users is called a pull

strategy. CDL has used pull strategy to promote Candia because the

market potential was already identified since UHT (Ultra High

Temperature). Sales were increasing. According to brand manager of

CDL pull strategy is effective to bring Candia bottles on the shelves of

stores. The margins given to retailers are 6.5% and to distributors are 9%

which are slightly higher than other UHT processed milks available in

the market.


No doubt Candia has no competitive product in the market, as it is

bottled milk. But still their exists an immense competition in this market.

According to the Candia’s brand manager Candia has captured Milk

Pak’s market share. Quite contrary to this are the consumer responses.

Consumers have shown dissatisfaction in various regards. A short

analysis is an evidence of that.


29% of the consumers are satisfied with present quality of the product.

Majority (i.e. 71%) of customers are not satisfied with the present

quality of Candia milk. The most important factor pointed out by (61%)

of the consumers is the taste of milk. Dissatisfaction regarding the taste

of the product might be due to the production process. 4.3% of the

customers think that using a plastic bottle can not be hygienic. Exposure

to sunlight and heat has resulted in some disorders like color of the milk

darkens and the taste changes. 26% complaints about color. Candia has a

unique color. Sampled consumers were not satisfied with color of the

milk. Consumers perceived the cream color as the result of some

chemicals added to the product. 8.6% of the consumers therefore

suspected the purity of the product. 8.6% of the consumers had some

additional complaints which are as follows:

1. product lacks freshness

2. Improved packaging

3. Cannot be used in tea or coffee


52% of the consumers are satisfied with current branding of the product.

47% have objected to the branding by the company. 78% of the

consumers are not comfortable with the name of the product because

1. Its not distinctive

2. It does not suggests something about the product, particularly its

benefits and uses.

3. It lacks in presentation i.e. packaging in respect of colors and

design (22% showed dissatisfaction regarding name of the



65% of the consumers are satisfied with 1 and 0.5 liter bottles. 35%

consumers would also like following sizes added to the current available


1. 2 liters

2. 3 liters

3. 5 liters


53% of the consumers are satisfied with current plastic packaging. 47%

customers think that packaging needs improvement. Out of which 18%

of the consumers think that packaging of the product is deceptive. 27%

of the consumers feel that plastic packaging is not feasible. Use of

recycled material is a weakness considered by 9% of the consumers.

46% of the consumers have detected following weaknesses.

1. Lid of the bottle, i.e. once the bottle is opened it has to be

immediately used. Other wise produce deteriorates.

2. Durability of the packaging material. Light and heat do effect

contents of the product.

Out of 47% of the consumers dissatisfied with packaging 80% have

suggested paper packaging and the rest suggested glass packaging.


37% of the consumers think that product is rightly priced. 63% of the

consumers are satisfied with the current price of the product out of

which 90% of that price of the product should be less than Rs.30.

Actually customers perceive that product is overpriced. Customers don’t

consider value added benefits for which company (CDL) should charge a

higher or equal price.,


28% of the consumers think that Candia appeals to every age group. But

82% feels that product appeals not only to children but adults as well.

Low fat content especially should be more attractive to people at the age

of 20 and above.


82% of the consumers think that company should enhance its company’s

product line by introducing low cholesterol Candia skimmed milk to

attract middle aged and above bracket. 18% thinks that enhancing

product line will only result in higher cost.


47% consumers think that there is enough brand awareness among the

people. This is the effect of the massive advertising campaign by the

company carried cut during Cricket World Cup 99. However 53% still

believe that there is not enough brand awareness. Out of which 60% of

the consumers suggest that company should not only increase shelf

spacing of its product but should also increase the number of outlets in

urban as well as in rural areas. 40% suggested free sampling can be a

good way to increase brand awareness.


44% consumers think that company has advertised much to promote is

product and 66% feel that company lacks in advertising front. Majority

(67%) of consumers stressed on broadcasting and print advertising. 33%

are of the view that company should have neon signs and billboards in

target areas.


53% consumers think that company should have price discounts element

in their sales promotion. Price ahs surely been one of the most important

concerns among consumers. Therefore, it might prove to be a good sales

promotional strategy. Gift vouchers although highly unorthodox, still

29% consumers supported the idea. In addition following suggestions

regarding sales promotion have been provided by the rest of the


• Lucky draws

• Buy four get one free

• Short term price cuts

• Price discount as well as gift vouchers


78% consumers suggest that company should have a certification of

Quality Management by an intentionally reputed institution related to its

product and 22% consumers think that company should have elegance in

its product name and packaging. These consumers think that for this

product, unique selling point would be its packaging which is different

from any other milk in local dairy scenario. Therefore, company should

work hard on this aspect to improve its sales.



After conducting the whole research, we have been able to point out

obtain areas of weakness in the marketing efforts of Candia. Because of

these gaps and flaws, Candia has not shown those results which were

expected at the time. Its launch the whole advertising campaign carried

out in the beginning paid only in the first three months. After that the

sales drastically fell down which forced the company to cut its

expenditure on promotions. On the basis of feed back gathered from

around seventy users of Candia and twenty retail stores which keeps

Candia, we evaluated several key failure points which are listed below.

• The foremost important attribute where Candia behind is the taste

and colour of milk. The colour is not purely white and therefore

people suspect that it is not pure and fresh.

• Secondly, Candia has failed to target all the age groups. The milk

has been able to stimulate demand the age group of 6 - 12 youth

and the elderly people are not forgeted. Youth and the elderly

people are not targeted. Young people age between 20 – 34 have

the highest purchasing power, elderly one the other hand do not

prefer Candia or any other packaged milk. They rather go for fresh


• Candia has failed to persuade the health conscious people, who

mostly belongs to their target market of higher income groups.

They perceive the milk very thick and hence switch to other low

fat milk available in the market.

• Another area of weakness is the pricing strategy used for Candia.

Its price is higher than other brands in the market. One time

Candia is following “Market Penetration” strategy and at the same

time the prices are kept higher than other brands, which does not

allow Candia to penetrate in the market.

• Regarding packaging of Candia, the plastic used in thick as

compared to the foreign plastic bottled milk available in the

market. This plastic used is not approved by any of he

associations. While the plastic used in the bottles of original

French Candia is “FDA” approved.

• Packaging is the only factor contributing to bad taste and colour of

milk. Although it is a USP packaging but if once it is exposed to

sunlight the milk gets discolored.

• Instead of plastic cap. Foil is used on the mouth of the bottle as a

seal wrapping. If seal is teared off for use it remained unclosed

allowing air to enter into the battle which further reduces the life

of the milk.

• Coming to the branding of the product, the name Candia, to most

of the Pakistan’s means more like a name of some Candy. This is

because people are not aware of the original European Candia

which is popular is 52 counties around the world. The brand name

is suitable more for a flavored milk rather than a plain milk.

• The labeling does not includes much information about the milk

only the fat contents is percentage are mentioned which is not

enough to inform a customer about the other important nutrients

contains in the milk.

• The packaging is deceptive in the sense that it is of white colour

while the milk if not pure white. The bottle should be transparent

so that the exact colour of the milk is visible.

• Another major reason of or failure of Candia is that, since its is

launched, the company has not been able to increase the depth of

the product such as, flavours, colours, sizes and varieties. These

innovations are necessary in building the image of brand in to the

minds of consumes.

• Candia did not conduct any free sampling at the time it was


• The retailers complaint that there major in the sale of Candia is 6 –

6.5% which should increase. Similarly the sales are low which

results in low turn over for retailers. So, retailers are not happy to

accept huge quantities to place in stores.

• There is no incentive or discount offered to retailers and end

consumers. Moreover, there is no bulk discounts like, buy 12, one

free. This practice is normally followed by other competitors.

• CDL has never tried to adopt the strategy of seasonal price cuts,

which could enhance sales and also could help the company to

monitor the changing buying patterns of customers.

• There is no enough brand awareness persist in the society for

Candia. That is why company is paying handsome amount of

money to limited retailers for keeping Candia bottles on the main

shelves where customers can easily watch them.

• The other major failure is that CDL is not providing deep freezer

and fridge’s to big retailer outlets and departmental stores for


• Not been able to target remote areas, small town and northern

areas of Pakistan where there is lot of demand for tea.

• The management at CDL is very much optimistic about the

product life cycle of Candia. They assume that Candia has

successful reached to growth stage but in reality, it is not the case.

The present PLC situation of Candia is something like this.

Candia is in declining stage, where the company has cutted down its cost

on its promotions. The only customers left are the loyal ones. The

company at this over whelming stage is required to change its overall

strategy for Candia.

There are certain other important areas where Candia has failed to

perform well. One of the major reason of its failure is that one part the

market which is targeted i.e. higher income groups living in posh areas,

even their, Candia’s Sales have declined drastically. The figures taken

from the two well known stores in defense society Lahore depicts the