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PROJECT REPORT

ON
BRITANNIA BISCUITS
(A Marketing Strategy)
Submitted in partial fulfilment of the requirement for
Internal Assessment
Master of Business Administration (MBA)
Batch: 2016- 2018

By

Mr. Jatin Goel


MBA 4th Semester
1602570007

Under the Guidance of


Prof. Meghna Chabbra

K.R. Mangalam University


Sohna, Gurgaon

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DECLARATION

I hereby declare that the Project Report on the Marketing Strategy of Britannia
Biscuits submitted by me to K R MANGALAM UNIVERSITY, is a record of an
original work done by me under the guidance of Dr. Meghna Chabbra, Mentor,
School of Management and Commerce, and this project work is submitted in the
partial fulfilment of the requirements for the award of the degree of Master of
Business Administration. The results embodied in this project have not been
submitted to any other University or Institute for the award of any degree or diploma.

Jatin Goel (1602570007) Date: April 25th, 2018

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ACKNOWLEDGEMENT

“The pleasure that follows the successful completion of a project would remain
incomplete without a word of gratitude for the people and without whose cooperation
the achievement would remain a distant dream. It is not a mere formality to place a
record of the tireless efforts, case less cooperation, constant guidance, and
encouragement of people closely associated with the project but a distant necessity
for the authenticity and readability of the project.”

I am using this opportunity to express my gratitude to everyone who supported me


throughout this Project of Marketing Strategy of Britannia Biscuits. I am thankful
for their aspiring guidance, invaluably constructive criticism and friendly advice
during this project work. I express my warm regards towards Dr. Meghna Chabbra,
for her advice, encouragement and scholarly guidance.

Finally, I am indebted to my family, friends and those people who helped me in


completing this project.

Jatin Goel

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TABLE OF CONTENTS

DECLARATION ……………………………………………………….2

ACKNOWLEDGEMENT ………………………………………………3

CHAPTER 1 …………………………………………………………6-11

 EXECUTIVE SUMMARY
 SECTOR INFORMATION
 COMPANY INFORMATION

CHAPTER 2 (research objectives)…………………………………12-44

 PRODUCT LINE
 SWOT ANALYSIS OF BRITANNIA BISCUITS
 TOW MATRIX
 VALUE CHAIN ANALYSIS
 MARKETING STRATEGY
 COMPETITIVE STRATEGY
 ORGANIZATIONAL STRUCTURE
 COMPETITIVE ADVANTAGES

CHAPTER 3 ………………………………………………………...45-49

 RESEARCH METHODOLOGY
1) Research Design
2) Research Objectives
3) Source of Data
4) Data Collection Instrument
5) Population and Sampling
6) Result and Findings

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CHAPTER 4 ……………………………………………………49-5

 RECOMMENDATIONS
 CONCLUSION
 BIBLIOGRAPHY

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CHAPTER 1

EXECUTIVE SUMMARY

The story of one of India's favourite brands reads almost like a fairy tale. Once upon
a time, in 1892 to be precise, a biscuit company was started in a nondescript house in
Calcutta (now Kolkata) with an initial investment of Rs. 295. Initially, biscuits were
manufactured in a small house in central Kolkata. Later, the enterprise was acquired
by the Gupta brothers mainly Nalin Chandra Gupta, a renowned attorney, and
operated under the name of "V.S. Brothers." In 1918, C.H. Holmes, an English
businessman in Kolkata, was taken on as a partner and The Britannia Biscuit
Company Limited (BBCo) was launched. The Mumbai factory was set up in 1924 and
Peek Freans UK, acquired a controlling interest in BBCo. Biscuits were in demand
during World War II, which gave a boost to the company’s sales.

As time moved on, the biscuit market continued to grow and Britannia grew along
with it. In 1975, the Britannia Biscuit Company took over the distribution of biscuits
from Parry's who till now distributed Britannia biscuits in India. In the subsequent
public issue of 1978, Indian shareholding crossed 60%, firmly establishing the
Indianness of the firm. The following year, Britannia Biscuit Company was re-

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christened Britannia Industries Limited (BIL). Four years later in 1983, it crossed the
Rs. 100 crores revenue mark. On the operations front, the company was making
equally dynamic strides. In 1992, it celebrated its Platinum Jubilee. In 1997, the
company unveiled its new corporate identity - "Eat Healthy, Think Better" - and made
its first foray into the dairy products market. Britannia strode into the 21st Century as
one of India's biggest brands and the pre-eminent food brand of the country. It was
equally recognized for its innovative approach to products and marketing. In
recognition of its vision and accelerating graph, Forbes Global rated Britannia 'One
amongst the Top 200 Small Companies of the World', and The Economic Times
pegged Britannia India's 2nd Most Trusted Brand.
Today, more than a century after
those tentative first steps, Britannia's fairy tale is not only going strong but blazing
new standards, and that miniscule initial investment has grown by leaps and bounds to
crores of rupees in wealth for Britannia's shareholders. The company's offerings are
spread across the spectrum with products ranging from the healthy and economical
Tiger biscuits to the more lifestyle-oriented Milkman Cheese. Having succeeded in
garnering the trust of almost one-third of India's one billion population and a strong
management at the helm means Britannia will continue to dream big on its path of
innovation and quality.

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SECTOR INFORMATION

Indian biscuit industry came into existence and started a gaining sound status in
bakery industry in the later 20th century when the urbanized society called for
readymade food products at a tenable cost. Biscuits were assumed as the sick man’s
diet in earlier days, but today it has become one of the most loved fast food products
for every age group. Biscuits are always easy to carry, tasty to eat, cholesterol free,
and reasonable at cost. States that have larger intake of biscuits are Maharashtra, West
Bengal, Karnataka, Andhra Pradesh and Uttar Pradesh.

Indian biscuit industry seems to be the largest among all the food industries and has a
turnover of around Rs.3000 Crores. Indian subcontinent is known to be the second
largest manufacturer of biscuits, the first being USA.

Marketing strategies of Food industry depend of the number of factor like


demographic profile, brand, health awareness, taste and quality & etc. The company
has to study the target region with regards to these factors. The increase share of the
market, company have continued focus on advertising, promotion and research in
study of consumer behavior for change in health awareness and taste. That only

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company like Britannia choose to manufacture product for every age and every type
of the people e.g Britannia Tiger for growing Kids, NutriChoice Hi-Fibre Digestive
for people having digestion problem, NutriChoice SugarOut for Diabetics people.
Keeping in factor like change in health awareness and taste of people , Britannia
adopted tagline like “Think Healthy Think Better “, “'Swasth Khao, Tiger Ban Jao”
and recently slogan “Zindagi Mein life”. Britannia Industries started marketing its
products with the new slogan “Zindagi Mein life” from last two years to target more
health conscious urban Indian. The change has worked – with its millions of Indian
consumers, who are getting more health-conscious by the day, believing in the brand,
trusting its promise of health and accepting innovations from the company. it is the
only biscuit maker in India which has made products trans-fat-free. The brand’s
efforts of the company is getting recognised more each passing day.
The study of the consumer behavior is very important to get into through marketing
strategies of company.

COMPANY INFORMATION

The beginnings might have been humble-the dreams were anything but. By 1910,
with the advent of electricity, Britannia mechanized its operations, and in 1921
became the first company east of the Suez Canal to use imported gas ovens.
Britannia's business was flourishing. But, more importantly, Britannia was acquiring a
reputation for quality and value. As a result, during the tragic World War II, the
Government reposed its trust in Britannia by contracting it to supply large quantities
of "service biscuits" to the armed forces. As time moved on, the biscuit market
continued to grow… and Britannia grew along with it. In 1975, the Britannia Biscuit
Company took over the distribution of biscuits from Parry's who till now distributed
Britannia biscuits in India. In the subsequent public issue of 1978, Indian
shareholding crossed 60%, firmly establishing the Indian origin of the firm. The
following year, Britannia Biscuit Company was re-christened Britannia Industries
Limited (BIL). Four years later in 1983, it crossed the Rs. 100 crore revenue mark. On
the operations front, the company was making equally dynamic strides. In 1992, it
celebrated its Platinum Jubilee. In 1997, the company unveiled its new corporate
identity - "Eat Healthy, Think Better" - and made its first foray into the dairy products

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market. In 1999, the "Britannia Khao, World Cup Jao" promotion further fortified the
affinity consumers had with 'Brand Britannia'. Britannia strode into the 21st Century
as one of India's biggest brands and the preeminent food brand of the country. It was
equally recognized for its innovative approach to products and marketing: the Lagaan
Match was voted India's most successful promotional activity of the year 2001 while
the delicious Britannia 50-50 Maska-Chaska became India's most successful product
launch. In 2002, Britannia's New Business Division formed a joint venture with
Fonterra, the world's second largest Dairy Company, and Britannia New Zealand
Foods Pvt. Ltd. was born. In recognition of its vision and accelerating graph, Forbes
Global rated Britannia 'One amongst the Top 200 Small Companies of the World', and
The Economic Times pegged Britannia India's 2nd Most Trusted Brand. Today, more
than a century after those tentative first steps, Britannia's fairy tale is not only going
strong but blazing new standards, and that miniscule initial investment has grown by
leaps and bounds to crores of rupees in wealth for Britannia's shareholders. The
company's offerings are spread across the spectrum with products ranging from the
healthy and economical Tiger biscuits to the more lifestyle-oriented Milkman Cheese.
Having succeeded in garnering the trust of almost one-third of India's one billion
populations and a strong management at the helm means Britannia will continue to
dream big on its path of innovation and quality. And millions of consumers will savor
the results, happily ever after.

Vision
The vision of the Britannia biscuits is to dominate the food and beverage market in
India with a distinctive range of “Tasty Yet Healthy” Britannia brands.

Mission
Britannia Biscuits set its mission as to dominate the food and beverage market in
India through a profitable range of “Tasty Yet Healthy” products by making every
Indian a Britannia Consumer.

Short-term Objectives:
 To improve image to shareholders.
 To improve internal processes and controls.

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 To increase NSV and ROI.

Long-term Objectives:
 To be the lowest-cost producer in the market.
 To become largest volume player in the bakery industry.

Major Milestones

 1892 – The Genesis Britannia established with an investment of Rs. 295 in


Kolkata.
 1910 - Advent of electricity sees operations mechanised.
 1921 – Imported machinery introduced, Britannia became first company to use
gas ovens.
 1975 – Britannia Biscuit Company takes over biscuit distribution from Parry's.
 1978 – Indian shareholding reached to 60 percent.
 1983 – Sales crossed Rs.100 crores
 1992 - BIL celebrates its Platinum Jubilee
 1994 – Volumes crossed 1,00,000 tons of biscuits
 1997 – New Corporate Identity ‘Eat Healthy, Re-birth - new corporate Identity
'Eat Healthy, Think Better' leads to new mission: 'Make every third Indian a
Britannia consumer' BIL enters the dairy products market
 1999 - "Britannia Khao World Cup Jao" - a major success! Profit up by 37%
 2013 - Britannia Industries Ltd, Kolkata was selected the winner of the
GOLDEN PEACOCK NATIONAL QUALITY AWARD for the year 2012,
Britannia was awarded "Manufacturing Supply Chain Award for End to End
Customer Solution Excellence" on 23rd January 2013 at the Asia
Manufacturing Supply Chain Summit (AMSCS) held in Mumbai.

Britannia bagged two National Quality Excellence Awards for 2013- one for
Best End-to-End Customer Solution (Supply Chain), and the second, for
Planning, Processes and Systems - on 14th February 2013 at Taj Lands End,
Mumbai

The Namm Bengaluru Award for 2012, in the Corporate Social Responsibility
category for initiating and implementing Solid Waste Management

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CHAPTER 2
PRODUCT LINE OF BRITANNIA BISCUITS

Innovation is key for the success. It is more so, in confectionery items for it is hard to
maintain the same curiosity levels for the brands particularly, among the youth.
Bangalore based Britannia Industries Ltd., with a portfolio of 35 brands of biscuits
known this truth.

BRITANNIA MARIE GOLD


Britannia's oldest brand enjoys a heritage that spans the last 50years - and going
strong. It is famous for its Britannia and Tiger brands of biscuit, which are popular
throughout India. Britannia has an estimated 38% market share. In a market swamped

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with me-too products and where even the name 'Marie' has become generic, Britannia
Marie Gold has maintained its strong hold. Today, the ever-popular Marie Gold is
synonymous with the 'Tea Time Biscuit'. Its taste, crispiness and lightness make it a
must for every tea break. It is the #1 brand in its category by a long shot.

FIFTY – FIFTY
Britannia initially introduced this sweet and salt biscuit product to capture the Parle's
"Krackjack" market share. Launched in 1993, 50-50 because of its "Hatke" taste and
youthful appeal quickly emerged as the leader of category with more than one-fourth
of market share. It bridges the gap between biscuits & snacks and tries to bring the
best of many worlds- Biscuits bhi Snack bhi, Sweet bhi Spicy bhi, Baked bhi
Chatapata bhi. The new product being baked and in bag format allows guilt free
snacking both in and out of home and thus making housewives "Snack happy".

BRITANNIA’S PRIDE – TIGER


With the launch of another new product "Tiger" Britannia made a significant shift in
its own business arena. The new product "Tiger" was launched in red coloured packs
to attract the eyes of the rural consumers as the rural consumers prefer this colour
very much. The later variants under the same brand name were having different
colours. But there market capturing capacity were lesser then that of the Red coloured
packed Britannia Biscuits. The micro packs @ Rs2 per 15gms were pushed to market
to expand the market to untapped areas and also to create new customers by making it
affordable even to a BPL consumer also. This has resulted in further increase in
Market share and also consumer preference.

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BRITANNIA GOOD DAY
was launched in 1986 in two delectable avatars - Good Day Cashew and Butter. Over
the years, new variants were introduced - Good Day Pista Badam in 1989, Good Day
Chocochips in 2000 and Good Day Choconut in 2004.
This rich cookie enjoys a fan following of consumers across all ages, loyal to the
brand promise of a great taste, evident from the visibly abundant ingredients. Good
Day is among the fastest growing brands in Britannia's portfolio and it has been the
leader in the cookies category ever since its launch. The brand is synonymous with
everyday treats that infuse happiness into people's lives.

CAKES
Britannia entered the cake market in the year 1963 and is the leading player in the
market. Britannia Cakes range is divinely scrumptious and has Bar Cakes, Chunk
Cakes and Cup Cakes which were launched in 2005. Bar Cakes are available in
variants that include Fruit, Butter Sponge, Chocolate, Pineapple, Milk, Vanilla
Chocolate and Orange. Apart from being delicious, these snacks are packed with
healthy ingredients making them wholesome & delightful.

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BRITANNIA NUTRI CHOICE
It provides you with a range of snacks and NutriBix which are inherently healthy yet
do not compromise on taste and come with a promise of adding goodness to your
lives.

GIFTS
Britannia brings you 'Shubh Kaamnayein' converting little moments of the festive
season into delightful memories The magical time of year, is round the corner. Bring
in this festive season rejoicing, and adding the glitter and glamour of celebration, with
Britannia 'Shubh Kaamnayein' a range of biscuits, premium cookies and cakes.The
special edition for 2008 'Britannia Premium Assorted Cookies' is all about surprises,
the enchanting discovery of new tastes and innovative packaging. It offers you
absolutely delightful cookies made with rich ingredients and flavors such as
Cranberry, Butter Scotch, Honey Raisin, Choc Chips, Coffee Almond, Cashew,
Honey and Almond. The much loved 'Britannia Classic Hampers' contain an
assortment of Britannia's popular brands like Good Day, Treat Jim Jam, Bourbon and
Little Hearts. The innovatively conceptualized packaging, of ingenious tray packs and

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collectible tin boxes, uses calligraphy, brush strokes of colors and clever use of
symbols, beautifully fusing tradition and art for the festive season. It brings alive a
commonality of joy and celebration. This range promises to pamper your senses and
emotions. We understand that the wondrous occasion of light and radiance is
incomplete without the presence of near and dear ones. Britannia 'Shubh Kaamnayein'
joins you as you express your love and good wishes, to the ones who make life special
for you. Britannia 'Shubh Kaamnayein' is designed to add joy to moments,
transforming them into delightful memories. We have judiciously packaged and
priced this entire range to make it available to everyone who wants to share good
wishes. As part of our 90th year festivity we present Britannia Shubh Kaamnayein, to
add 'Zindagi mein life'.

Britannia Nutri Choice Oat Cookies


For the first time in India we have Britannia NutriChoice 'Diabetic Friendly'
Essentials specially designed for people with diabetes. There's no longer a need to
avoid snacks or go hungry while traveling or at work. Rather approach snacking in a
healthy way with our Oat Cookies.
Britannia NutriChoice Oat Cookies are scientifically created to suit the special
lifestyle and nutrition needs of diabetics to manage extreme swings in blood sugar.
They are tasty, crunchy and convenient option for those mid-meal pangs. In addition,
the oat fiber lowers rise in blood sugar, helps control blood cholesterol and helps you
feel satisfied and active for longer.

Britannia NutriChoice Ragi Cookies


For the first time in India we have Britannia NutriChoice 'Diabetic Friendly'
Essentials specially designed for people with diabetes. There's no longer a need to

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avoid snacks or go hungry while traveling or at work. Rather approach snacking in a
healthy way with our Ragi Cookies. Britannia NutriChoice Ragi Cookies are
scientifically created to suit the special lifestyle and nutrition needs of diabetics to
manage extreme swings in blood sugar levels. They are tasty, crunchy and convenient
option for those mid-meal pangs. Ragi helps lower blood glucose levels and in a rich
source of magnesium, which is instrumental for the production of important enzymes.
Our Ragi Cookies are a good source of fiber, both soluble and insoluble, for heart and
digestive health.

Nutrichoice Health Starter Kit


2010 - Britannia Nutrichoice launches a New Year pack - the Nutrichoice Health
Starter Kit . Created for everyone who makes a New Year resolution to become
healthy and does not follow through on it. The Health Starter Kit contains a range of
healthy biscutis - 1 pack each of Nutrichoice Hi-Fiber Digestive, Nutrichoice 5 Grain
and Nutrichoice Nature Spice Cracker. It also has a one week free pass to Talalkars
gym that entitles every consumer to one week free trial of any Talwalkars (TBVF ltd)
gym across the country. In addition to this the pack also contains a Fit Sip Sipper and
a fitness chart. All this for only Rs 100.

NutriChoice 5 Grain
Most consumers believe that to in order to stay healthy one needs to make certain
compromises on some good things in life. Whether it is choice of extra hour of sleep
over early morning exercise and eating unappetizing foods over oil-dripping samosa.
At the same time most of us agree that good nutrition cannot come from one kind of
food alone, but from a healthy combination / assortment of several healthy ingredients
put together. Britannia NutriChoice 5 Grain Biscuits are a perfect answer to those
looking for healthy eating options without as much making a compromise on taste, or
convenience, or health.
Because Britannia NutriChoice 5 Grain biscuits are made from 5 carefully chosen
healthy cereals (Oats that help reduce bad cholesterol, Corn which promotes heart
health, Ragi a good source of both Calcium as well as Fibre, Rice low in fat, and
Wheat that provides wholesome energy). These biscuits are delicately sweetened with
natural honey, and come in a unique large oval shape. It is this large size and the

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healthy combination of the ingredients, that make it an ideal hunger buster for those
in-between meals time hunger.
Britannia NutriChoice 5 Grain biscuit pack contains several small single serve pocket
meals packs, so that one is never far away from pacifying hunger on the move. So
whenever you miss your breakfast, or succumb to those unhealthy evening snacks,
you can relish the goodness of health with Britannia NutriChoice 5 Grain biscuits.

NutriChoice SugarOut
Sounds like yesterday when people commented that healthy foods meant
"compromising on the taste." NutriChoice SugarOut is the most novel product range
to have been introduced in the market. The product is not just sweet but tastes great,
and yet contains no added sugar.
This is because NutriChoice SugarOut is sweetened with "Sucralose," derived from
sugar, which provides the same sweetness as any other biscuit, without the added
calories of sugar.
This range is available in 3 delicious variants namely Litetime, Chocolate cream,
and Orange cream, targeted towards all health sensitive people. It is also relevant for
consumers with sugar related ailments.
We are sure that you will be pleasantly delighted with its great taste and equally
surprised to know that it has no added sugar.
Don't be taken for a ride when you read "Sugar Free" label on many biscuit packs
marketed in India or abroad. Even with 100% no-added sugar, wheat-cereals in
biscuits have their own natural sugar content. Britannia has chosen to represent these
biscuits with "No Added Sugar" claim, as there is no added sugar in the processing of
NutriChoice SugarOut.

NutriChoice Digestive Biscuit


Nothing can be more difficult than making small efforts in our daily life towards
healthy and active living. 24/7 we are engrossed in our busy schedules; skipping
meals, missing walks, along with inadequate sleep and frequently eating-out, all take
a heavy toll on our health.

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At least with the new and improved NutriChoice Digestive Biscuit, we have one less
thing to worry about. Made with 50% whole-wheat and packed with added fibre (10%
of our daily dietary needs), these delightfully tasty biscuits are amongst your
healthiest bites of the day.
In your next visit to a shop just look out for its Golden-green international carton
pack. Try one and you'll know that you've made one smart choice - NutriChoice.

Treat Fruit Rollz


All kids who have relished the yummy creamy treasures of Britannia Treat in exciting
flavors, have yet another reason to celebrate! Britannia Treat launches the amazingly
yummy Treat Fruit Rollz!! These tasty soft rolls are filled with real fruits and provide
a healthy yet mouth-watering treat to the kids. Fruit Rollz comes in four masti fruit
flavours - Juicy Apple, Strawberry Surprise, Tangy Orange and Delicious Dates!
Want to know a little secret? They make the best tiffin treats! So during snack time
what better than to munch on the delicious and healthy Fruit Rollz and discover the
yummy fruit flavor from within the shells. Keeping up with Britannia's platform of
'taste bhi, health bhi', Fruit Rollz is indeed a yummy snacking option for kids, while
keeping the Moms assured about the goodness provided by the fruit filling. So go on
and treat yourself to the lip-smacking snack!

New Britannia Milk Bikis


Milk Bikis, the favourite growth partner of Kids, now brings greater value and delight
to all with its new product and pack design. Recently re-launched in its existing
Southern & Eastern markets, and extended across India, the new Milk Bikis is all set
to add excitement and appeal to ‘nutritious’ food. Whoever said that ‘good food’
needs to look ‘dull and boring’, will just have to take a look at Milk Bikis.
With a unique and attractive honeycomb design and an enhanced product experience,
the new biscuit prompts the ‘Kid’s will love it’ reaction amongst mothers. The milk
goodness in the recipe is now enhanced with SMART NUTRIENTS – 4 vital
vitamins, iron and iodine, proven to aid mental and physical development in growing
kids. The premium packaging, besides appealing to kids, also ensures that the biscuits

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remain fresh and crisp. So, whether its breakfast time or snack time at school, rest
assured that kids will look forward to munching these crunchy, milky biscuits which
even helps in their development. And yes, adults won’t be far behind in reaching out
for a pack!

SWOT ANALYSIS OF BRITANNIA BISCUITS

STRENGTHS WEAKNESS

 Fulfill one of our basic requirements  Decrease nutritional value


among Air, Water, Food and Shelter.  Increases the cost of food product
 Widely accepted in all generations.  Industry and technology requires high
 Eaily available in various forms. investment
 Provide good instant remedy for hunger  Regular usage of processed food can
in the form of readymade foods. cause alteration in health
 Preserves the non seasonal food and
makes it available all throughout the year.

OPPORTUNITIES THREATS

 Increases economy of India  Many companies are result oriented


 Generate employment opportunity  Increse in Pollution
 Good quality of Goods  Sometimes provide poor quality
 Provide competition to Foreign products for more profits
companies  Lack of Technology
 Improve living Standard  Unable to utilize all available resources
 Provide goods in India for cheaper prices efficiently
 Inflow of foreign reserve and funds for
the government ( Taxes )

STRENGTHS

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 Britannia is the market leader in its industry and is among the fastest growing
FMCG companies in the last two years
 Its net profit increased by 77.5 per cent and operating margin by 307 basis
points to 7.5 per cent in 2007-08, despite inflation in key commodities by 20-
25 per cent in the last two years.
 In a survey conducted by AC Nielsen ORG-Marg, consumers voted brand
'Britannia' among the 'Top 10' most trusted brands across categories for the
fifth successive year.
 It was also rated as the second most trusted food brand in 2008 and first in
2007.
 It was rated as the seventh most trusted brand across all categories in 2008.
 Its performance in 2007-08 was strong, with a sales growth 17.5 per cent,
besides a 27.5 per cent growth in the previous year, adding Rs 800 crore of
incremental revenue during this period (total revenue for 2007-08 was Rs
2,617 crore).
 It is the only biscuit company to have removed trans-fat from all its recipes.
Approximately 50 per cent of the company's bakery portfolio is now sold
fortified with micronutrients
 Widely accepted and available and it is a non- seasonal food which is in
demand thought-out the year
 Diverging into new products and categories like Tiger Pops (smaller version
of the Tiger glucose biscuit) and Pepper Chakkar (the 50-50 biscuit sprinkled
with pepper to give it a snack-like flavor)
 It has doubled its advertising budget in the last 5 yrs.
 Strategy to concentrate more on the trade marketing

WEAKNESS

 Requires a high level of investment in terms of innovation and technology in


which Britannia is stagnant
 Britannia Industries witnessed a loss in sales momentum for the third
consecutive quarter (2005-06) as the company has been feeling the heat of
growing competition
 Focus only on premium segment

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 Biscuits is the only thing Britannia is known for even though it deals with
dairy products
 Processed food is considered unhealthy
 Biscuits were assumed as sick-man's diet in earlier days

OPPORTUNITY

 Demand for a health free product as people are more health conscious
 Improved standard of living
 Higher disposable income
 The rural sector consumes around 55 percent of the biscuits in the bakery
products.
 Bread and biscuits are the major part of the bakery industry and covers around
80 percent of the total bakery products in India
 India is considered as the third largest producer of Biscuits after USA and
China, the per capita consumption of biscuits in our country is only 2.1 Kg.,
compared to more than 10 kg in the USA, UK and West European countries

THREATS

 The Wadias of Bombay Dyeing Group and France's Groupe Danone have
separated and Danone plans to use of Britannia Industries Ltd's biscuits brand
"Tiger" in several countries.
 Competitors coming up with similar products at a lower price since this
commodity is very price sensitive
 Rapid increase in the cost of major inputs such as wheat flour, sugar, oil,
packaging material, fuel, power, transportation, etc, has made a dent in the
viability of the industry as it is an agro based industry.
 Biscuits deserve parity with tea, coffee and other basic food products that are
liable to VAT at 4 per cent instead of being subject to VAT at 12.5 per cent
applicable to delicacies
 Commodity inflation continues to have a significant impact on input cost and
this inflationary pressure has put industry profits under pressure.
 Food is a fickle segment. And biscuits is a highly penetrated category
 Completion form foreign companies

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 Poor quality for lower prices

TOWS MATRIX

Strengths Weakness
INTERNAL FACTORS  Market leader  Requires a high level of investment
(IFAS)  Fastest growing in terms of innovation and
FMCG technology in which Britannia is
 Its net profit stagnant
increased by 77.5  Showed that it can’t handle
EXTERNAL FACTORS per cent competition
(EFAS)  'Britannia' among  Focus only on premium segment
the 'Top 10' most  Product Portfolio
trusted brands  Processed food unhealthy
across categories  Sick-man's diet
for 5 successive
years.
 Trans-fat free.
 Widely accepted
,available and non-
seasonal food
 Doubled
advertising budget.
 Trade marketing
Opportunities SO Strategies WO Strategies
 People are more health  Grow market by  Invest more in R&D.
conscious horizontal  Keep an eye on the competitors
 Improved standard of integration. market
living  Innovation in terms  Expand product portfolio
 Higher disposable income of small packages
 Rural India Market to be sold in rural
 Biscuits covers 80 markets
percent of the total

23
bakery products in India

Threats ST Strategies WT Strategies


 Price sensitive  Make use of the  Invest more in marketing to
 Subject to VAT at 12.5 least input to position the product properly
per cent minimize costs  Offer lower prices
 Use of Britannia while not
Industries Ltd's biscuits distracting from the
brand "Tiger" in other quality
countries  Expand the product
 Commodity inflation. portfolio
 Fickle segment.
 Highly penetrated
category
 Completion form foreign
companies
 Poor quality for lower
prices
VALUE CHAIN ANALYSIS

A value chain analysis of a company is done in order to bring out its competitive
advantages, core competencies and core deficiencies. According to Porter, a

24
manufacturing firm’s primary activities usually begin with inbound logistics, go
through an operations process in which a product is manufactured, and continue on to
outbound logistics, marketing and sales, and finally to service. Along with this,
several support activities such as procurement, technology development, human
resource management, and firm infrastructure ensure that the primary value chain
activities operate effectively and efficiently.

We will now analyze how Britannia concentrated on each of primary as well as


support activities to further increase their profit margins and efficiency.

INNOVATION

When Britannia started facing stiff competition from new players like IT ltd and Priya
Gold, they found that in order to gain a competitive advantage over them, they needed
to invest in their R&D and come up with new innovations. They began by bringing in
new variants of their existing products and enhancing the quality of their products.
One major step they took to enhance quality was to remove 8500 tons on trans-fat
from their biscuits, making them completely fat free and becoming the only company
to have done that. They also fortified their biscuits with vitamins and micronutrients
like iron, and soon 50% of their products were fortified. They invested in their
segments of bread, rusk and cakes, and soon doubled their business in this category by
recognizing that building brand and innovating were the key drivers of growth. Some
of the new products & packs introduced included Treat Fruit Rollz, NutriChoice
Digestive, NutriChoice SugarOut, Good Day Jumbo, Tiger–Banana (fortified with
iron), Good Day – Classic Cookies, Greetings – gift packs and a variety of cheese
variants. To tap the non-traditional Marie markets, Britannia came out with Marie
Doubles, which were as light as Marie but with a slight chocolate-orange flavor.

OPERATIONS

On the infrastructure front, Britannia added 200,000 tons of annual capacity, an


increase of about 60%. It also devised a long-term distributed manufacturing strategy,
put in place a continuous replenishment supply efficiency system, and strengthened its
supply chain management as well. With the help of these measures, the stocks at their

25
distributors were replenished within 24 hours, and they increased the availability of
stock-keeping units from 60% to 90% across the country.

They invested over Rs 200 crore in capacity expansion. A part of this investment was
utilized to hike capacity at its Uttaranchal plant from a level of 45,000 tons to 60,000
tons. Products are sourced from several manufacturing locations spread across the
country and reach their consumers through an efficient and widespread distribution
chain. They improved their manufacturing facilities to meet the growing demand.

They also tied up with Prima Engineering Industries, a very reputed supplier of
machines used for baking biscuits, to provide them with the latest technology for
better quality biscuits. This helped them increase efficiency as they could bake larger
batches with advanced technology.

OUTBOUND LOGISTICS AND DISTRIBUTION

Investments made in this division also helped Britannia contribute to its profit margin.
They invested significantly in higher and better quality of human resources both at the
front end and at the back end. They also segmented their go-to-market strategy
wherein earlier they focused on simply increasing the number of outlets covered.
They changed it by creating separate teams for general sales, modern trade,
institutions, and semi-urban and rural markets.

MARKETING AND SALES

With competition increasing from the small as well as big players, Britannia needed to
bring about significant changes in their marketing and promotional strategies, in light
of gaining competitive advantage. This would also help them in the future to increase
their profit margins as an investment in any of the divisions eventually leads to higher
efficiency and better profit.

They began by aggressively marketing their products as healthier alternatives in


comparison to other biscuits. They introduced new campaigns like ‘Eat Healthy,
Think Better’ which portrayed that Britannia biscuits were of high nutritional value.

26
They invested heavily in advertising to promote the new identity of biscuits i.e. health
foods and also made an attempt to increase trade marketing visibility. They marketed
their products to the retailers and distributors to increase their loyalty towards them.
This step would benefit the retailers and ensure that they marketed Britannia’s
products in comparison to the competitors.

They also changed their packaging by introducing smaller packages to attract the
youth and travelers. They added transit point like bus stops and small roadside shops
to their distribution network.

MARKETING STRATEGY OF BRITANNIA

Marketing is a societal process by which individuals and groups obtain what they
need and want through creating, offering and freely exchanging products and services
of value with others or otherwise it is the process of planning and executing the
conception, pricing, promotion and distribution of ideas, goods, services to create
exchanges that satisfy individual and organizational goals.

27
Marketing Strategy
Marketing strategy is a set of objectives, policies and rules that leads the company's
marketing efforts. It is the marketing approach to accomplish the bread objective of
the marketing approach to accomplish the bread objective of the marketing plan. The
various process of marketing strategy is given below:
1. Selecting largest markets segmentation
2. Positioning
3. Product
4. Price
5. Place
6. Promotion
7. Research and development
8. Marketing research

Marketing strategies serve as the fundamental underpinning of marketing plans


designed to fill market needs and reach marketing objectives. Plans and objectives are
generally tested for measurable results. Commonly, marketing strategies are
developed as multi-year plans, with a tactical plan detailing specific actions to be
accomplished in the current year.
Marketing strategy involves careful scanning of the internal and external
environments. Internal environmental factors include the marketing mix and
marketing mix modeling, plus performance analysis and strategic constraints.
External environmental factors include customer analysis, competitor analysis, target
market analysis, as well as evaluation of any elements of the technological, economic,
cultural or political/legal environment likely to impact success. A key component of
marketing strategy is often to keep marketing in line with a company's overarching
mission statement.

DEFINATION OF MARKETING STRATEGY:-


Marketing strategy is defined by Prophet's David Aaker as a process that can allow an
organization to concentrate its resources on the optimal opportunities with the goals of
increasing sales and achieving a sustainable competitive advantage.

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Marketing strategy includes all basic and long-term activities in the field of marketing
that deal with the analysis of the strategic initial situation of a company and the
formulation, evaluation and selection of market-oriented strategies and therefore
contribute to the goals of the company and its marketing objectives.
According to Shaw, Eric Marketing Strategy: From the Origin of the Concept to the
Development of a Conceptual Framework. In Marketing, there is a framework for
marketing strategies.
 Market introduction strategies

"At introduction, the marketing strategist has two principle strategies to choose from:
penetration or niche".
 Market growth strategies

"In the early growth stage, the marketing manager may choose from two additional
strategic alternatives: segment expansion or brand expansion.
 Market maturity strategies

"In maturity, sales growth slows, stabilizes and starts to decline. In early maturity, it is
common to employ a maintenance strategy, where the firm maintains or holds a stable
marketing mix".
 Market decline strategies

At some point the decline in sales approaches and then begins to exceed costs. And
not just accounting costs, there are hidden costs as well; as Kotler observed: 'No
financial accounting can adequately convey all the hidden costs.' At some point, with
declining sales and rising costs, a harvesting strategy becomes unprofitable and a
divesting strategy necessary".

Early marketing strategy concepts were:


 Borden’s “marketing mix”

"In his classic Harvard Business Review (HBR) article of the marketing mix, Borden
(1964) credits James Culliton in 1948 with describing the marketing executive as a

29
'decider' and a 'mixer of ingredients.' This led Borden, in the early 1950s, to the
insight that what this mixer of ingredients was deciding upon was a 'marketing mix'".

 Smith’s “differentiation and segmentation strategies”

"In product differentiation, according to Smith, a firm tries 'bending the will of
demand to the will of supply.' That is, distinguishing or differentiating some aspect(s)
of its marketing mix from those of competitors, in a mass market or large segment,
where customer preferences are relatively homogeneous, in an attempt to shift its
aggregate demand curve to the left (greater quantity sold for a given price) and make
it more inelastic (less amenable to substitutes). With segmentation, a firm recognizes
that it faces multiple demand curves, because customer preferences are
heterogeneous, and focuses on serving one or more specific target segments within
the overall market".

MARKETING STARTEGY OF BRITANNIA

Strategy Formulation
Framing Mission and Objectives:-
In the step Britannia Company Forms its mission and objective, which has been
decided by top level management mainly by Mrs. Nasali wadia and Ms. Vinita Bali
Analysis of the Internal Environment:-
In this part Britannia company analyzes its strength, weakness , opportunity, and
threat and decisions are made by the top level management or build up automatically
as company progressed up.
Analysis of the External Environment:-
In this part company done external analysis i.e. PEST analysis. In market Britannia is
a big name so politically he is strong, Chairmen Nasali wadia is engaged in many
Indian government and political society.
Gap Analysis:-
Britannia biscuits are the most selling biscuits brand across the globe; Britannia
biscuits are healthy, efficient, powerful, standardized, segmented according to
categories and cheap in price. So all together customer gets what they need, sometime
there is gap between their expectations and companies delivery of product.
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Framing Alternative Strategies:-
They have also back up plan, they use those plan according to the market condition.
Choice of Strategy:-
Britannia’s first choice shop they kept Britannia contest to attract customer. They can
think differentiation as their alternate choice.

Strategy Implementation
Formulation of Plans: -
The strategy planned by top level management. But the implementation part has done
by Business level and function level. The plan that how can they achieved the target.
For this they divided the big work into small work. After that they implement small
work.
Programs and projects:-
After acquiring the biffest share in the market they are preparing their company for
the next step to achieve its goal. Their management is trained by the training program
to make them familiar with the Britannia family.
Resource Allocation:-
To develop Britannia Biscuits market Britannia Company is using various resources
such as physical resources, financial resources and human resources.
Structural Implementation:-
There is need for organizational structure to implement strategies. Britannia
company’s structure is the framework through which an organization operates.
Functional Implementation:-
A manager can also change activity of the salesperson. The manager that is head of
the department of the Britannia Company takes all roles and responsibilities to get the
work done from others. The decisions taken by them are implemented by all the
workers or employees.
Behavioural Implementation:-
Britannia is very much employee oriented organization the marketing departments
have given the performance bonus &they have been send to the factory to
demonstrate biscuits.

Strategy Evaluation
Setting of Standards:-
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In this level manager set target to his sales person, generally every departments work
on target basis.
Measurement of Performance:-
Now in this case manager analyze that whatever the target had given to the sales
peoples has done or not.
Comparison of Actual Performance with standards:-
Now they check theactual performance of the sales people and analyze the
performance.
Finding out deviations:-
In this case they check why the sales people not ableto achieve the target, whatever
the target had given to the sales people wherewas the deviation.
Analyzing Deviations: -
After that the manager and top level management check that deviation.
Taking Corrective measures:-
After that manger tries to solve those deviation, Basically the sales people will again
send to the training field review and on job training, this is the method Britannia
adopts quite often.
The company’s policy is customer satisfaction with less price as well as quality.
Target maximum customer and sale of maximum volume. The company wants to
reach the product in every segment of customer. also have targeted to urban, rural,
city town and villages area of a market. High promotion for selling the product and
achieve maximum market share. The company wants to increase the profitability by
selling of maximum quantity. The company is facing high competition so the profit
margin is low but high turnover. The company’s major competitors are PARLE,
SUNFEAST ANMOL and PRIYA GOLD, Britannia volume crossed one lakh ton
biscuit in 1994.

BRANDING (Brand Management)

1. Create Brand Recognition


Instead of just advertising on Bats of cricket stars, Britannia should think of getting a
single person as their ambassador, someone with whom the youth identify
with(Considering that Rahul Dravid is slowly retiring from all forms of International
Cricket). It could be a cricket star like the ever green Sachin Tendulkar, but yet again

32
cricket is a risky affair, or someone who will always be in the news for the right or the
wrong reasons – like Ranbeer Kapoor from bollywood.

2. Brand Knowledge
 There should be campaigns in school, in class 6 and 7 (that is when an
individual starts forming his/her own perception about brands and available
consumer goods).
 The campaigns could be tied up with Inter school Competitions or something
that creates and spreads awareness. For example: National Health Mela in
Delhi, which is an annual event and invokes participation from all major
schools in Delhi. The event is a national level event and is done to spread
awareness about health issues amongst the youngsters from a delicate age
when perceptions, beliefs and attitude are still developing.

3. Brand Preference
Britannia enjoys almost a 40% share in the biscuit market and also its cake sales for
Fiscal 2010 – 11 have grown at 62% (by value)from 1,193,097 to 1,936,793 which
shows that the brand does enjoy a deep preference amongst the masses but needs to
work on promoting it in a better way in each target segment.

1. Market segmentation and selecting target market


It is an effort to increase a company's precision marketing. The starting point of any
segmentation discussion is mass marketing. In mass marketing, the seller engaged in
the mass production, mass distribution and mass promotion of one product for all
buyers. Market segment consists of a large identifiable group within a market with
similar wants, purchasing power geographical location, buying attitudes or buying
habits. It is an approach midway between mass marketing and individual marketing.
Through this the choice of distribution channels and communication channels become
much easier. The researchers try to form segments by looking at consumer
characteristics; geographic, demographic, and psychographic. After segmenting the
market then target market selected.
2. Positioning: - The positioning is a creative exercise down with an existing product.

33
The well known products generally hold a distinctive position in consumer's minds.
The positioning requires that every tangible aspect of product, price, place and
promotion must support the chosen positioning strategy. Company should develop a
unique selling proposition (USP) for each brand and stick to it, PPL consistently
promotes it’s DAP fertilizer by Higher yield at lower cost. As companies increase the
number of claims for their brand, they risk disbelief and a loss of clear positioning. In
general a company must avoid four major positioning errors. Those are under
positioning over positioning, confused positioning and doubtful positioning.
3. Product: - A product is any offering that can satisfy a need or want. The major
types of basic offerings are goods, services, experiences, events, places, properties,
organizations, information and ideas. The company gives more importance in quality,
packaging, services etc. to satisfy the customers. The product has its life cycle. The
product strategies are modified in different stages of product life cycle.
4. Price: - It is the most important aspect in company's point of view. Price of the
product will be decided by the company according to the competitor's price.
5. Place: - This plays a major role in the entire marketing system. The company
emphasis on its distribution network. Proper distribution network gives proper
availability of the product. Getting the right product to the right place at the right time
involves the distribution system. Distribution is the process of moving goods and
services to the places where they are wanted.
6. Promotion: - Promotion is the one of the major aspects in marketing strategies. By
adopting various promotional activities the company create strong brand image. It
also helps in increasing the brand awareness. It includes advertising, sales promotions
and public relations etc.
Advertising:
Britannia works in close partnership to promote its biscuits with retailers. Promotion
costs are shared with retailers. The more retailers sell - the more Britannia is able to
help them. Britannia launches products that offer the company good returns,
supporting these through brand building and leveraging on its nationwide supply
chain. Brand building is an integral part of Britannia’s marketing philosophy with
continued promotions for its various brands creating loyal customers in the process.
Good Day, "Richness is only one functional facet of Good Day. But there is also a
large emotional facet — that of spreading happiness. This became the plank on which
Good Day began to be advertised. Also with traditional notions of health changing,

34
rich foods are not necessarily looked at as being unhealthy. "Good Day is full of nuts
and is rich but it is also good for health. So, they created the Swasth kao, tan man
jagao (Eat healthy, energize body and mind) campaign."
Sales promotion:
“Eat Britannia, Go for World Cup" was the theme adopted in 1999 .People bought the
biscuit packs and searched for the lucky scratch for flying to England to see world
Cup Cricket match. The sales bounced 37% high on account of this strategy. The
scheme came alive again during the world Cup Match in 2002-2003 in South Africa.
“Lagaan - the super hit movie " brought fame to Britannia Biscuits also as 40000
buyers of Britannia Biscuit packs were invited to see and a small lucky group to play
the game with the movie Stars of Lagan. What a novel way to promote a product - a
perception in correct proportion indeed!! Now, recently promotional strategies are
"Jodi Banao" Offer & winning ideas of the “Monmatano Britannia pran bhorano
sharodiya” contest like create a special flower arrangement for dashmi. Get all the
women in your street together and make a huge, elaborate face of durga with flowers.
Publicity:
Britannia brand is advertised through hoardings on cricket grounds, on highways,
through image building exercises like donations etc.
7. Research and Development: - after testing, the new product manager must
develop a preliminary marketing strategy plan for introducing the new product in to
the market. The plan consists of three parts. The first part describes the target market's
size, structure and behavior. The second part outlines the planned price, distribution
strategy and marketing budget for the first year. The third part of the development
describes the long run sales and profit goals and marketing mix strategy over time.
Channel Levels: The channel of distribution used by Britannia is:
Intensive Distribution: As biscuits need to reach the consumer at their nearest
locations this type of distribution channel is used. This type of distribution helps when
for products that are categorized by low involvement of the customer and where
customer looks for location convenience.

35
36
BRITANNIA COMPETITIVE STRATEGY

Britannia is a leading brand in the Biscuit Industry, but that does not rule out the
existence of other small scale and large scale manufacturers. The other major brands
of biscuit in India are Parle Bakeman, Priya Gold, Elite, Cremica, Dukes, Anupam,
Horlicks, Craze, and Nezone. Amongst these brands, only Parle has been able to give
Britannia some competition. Britannia is very well established in the market and
completely insulated from competition from the others.
Even with Parle’s presence in the industry, both these brands managed to coexist in
harmony. Parle focused primarily on the low-end glucose biscuit segment, its Parle G
brand being one of the world's best-selling biscuits, and Britannia focused on the
premium segment. Due to this, they had nearly equal shares of more than 80% of the
market value. Britannia is the leader in all biscuit categories, except glucose, where
Parle has an edge. Parle is the market leader by volume, but still trails Britannia
marginally in value terms. Glucose biscuits account for 57 per cent of the Indian
biscuit market and Parle G accounts for 50 per cent share of this segment. Parle priced
its 100 gram pack of glucose biscuits at Rs 4, due to which no competitor could afford
to increase prices by even 25 paise. This was putting pressure on margins and
affecting growth. Parle had a very strong competitive advantage over any other player
in the market. Since they were a smaller company, they could keep a better tab on
their overheard expenses and therefore keep costs low. But even then, Britannia did
not feel very threatened as they maintained that they led the overall market in terms of
value. They believed that more activity in the biscuits market created more
opportunities for them.

Britannia encountered its first threat from a competitor when ITC ltd entered the
biscuit industry with an aim to expand in the FMCG segment. They entered this turf
as part of their diversification strategy in 2003. Analyzing ITC’s competitive strategy,
we found that they used offensive tactics, and their attack on Britannia can be
classified as a Frontal Assault. They barged straight into the biscuit industry and
matched the existing players in price, promotion and distribution. With the help of
their financial support and massive distribution network, they quickly emerged as a
third player in the industry and completely shook Britannia and Parle from their

37
comfort zones. They had been coexisting peacefully for a long time and did not adapt
well to the sudden change. ITC grabbed an 8-10 per cent market share within hardly
any time of entering the market. Many big players like HLL had tried to enter the
biscuit market but failed to establish themselves, but ITC squeezed its way through
and settled in snugly on some part of the market share. This was possible for them as
they intensively researched the market before entering and realized that they could fill
the gaps existing at that time. There had been no new energy or wow factor in the
market in a long time, no new product or innovations had been made by either of the
big players. ITC decided to launch Sunfeast with six ranges, orange-flavoured Marie,
Marie light and butterscotch-flavoured cream biscuits.

While Parle looked at a high volume, low margin strategy, Britannia and ITC looked
at a two-forked strategy, i.e. high margins in cream variants and volumes from the
Marie and Glucose segments.

At this point of time, Britannia was completely unprepared internally to combat ITC’s
competition. They also started facing stiff competition from regional players like
Priya Gold in the north and west, Anmol and Bharat in the north and east, and Duke
in the south.

Britannia soon realized that they need to restructure themselves and bring some
changes in their internal environment in order to secure their position as the No.1
brand in the biscuit industry again. There was a need for them to analyze their
company and find competitive advantages which would help them clearly stand above
their competitors.

While ITC ltd used their strong brand image and financial back up to collide head on
with Britannia on their own turf, Britannia understood that throwing it right back at
ITC would not be a wise decision. Therefore, they decided to go for a Bypass attack.
Instead of marketing their products more aggressively or changing price etc., they
decided to give their product a new identity, completely different from the identity of
biscuits currently in the market.

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Market share

4th Qtr
20%
Britania
ITC 36%
10%

Parle
34%

They began by sharply differentiating their products from its competitors by


intensively marketing them as a ‘healthier alternative’. They stressed up on the fact
that Britannia was not in the "health food" business, but rather "in the business of
delight and enjoyment", competing not only with other biscuits but also with savories,
chocolates and other snacks.

This was a major competitive advantage over ITC as their food products were not
perceived as healthy. They have a very strong presence in the tobacco industry, and
therefore it was hard for them to shake off that image from the minds of customers
and portray themselves and producers of healthy biscuits.

Britannia recognized that this was the time for them to innovate and introduce new
products in the market and move closer to gaining competitive advantage. They had
not introduced anything new in the market for a long time. They invested in their
R&D department, and started work on new recipes for biscuits.

Making their image of providing ‘healthier alternative’ even stronger, their research
and development department found a way of removing 8500 tons of trans fat from
their biscuits, making them completely fat-free. They are the first in the biscuit
industry to have taken such a step. They even fortify their biscuits with vitamins and
micronutrients like iron. Currently, 50% of their biscuits are fortified.

39
They decided to invest in people, brand and infrastructure in light of fighting
competition. They planned on achieving that by improving efficiencies, reducing
costs and looking for new customers.

They also tried to reposition their product in the minds of the consumers. They
wanted to shed away the boring image of biscuits while retaining its core of energy
and health. They began to explore new ways to deliver the “goodness of biscuits in a
more interesting and fun way”.

PORTERS FIVE FORCES

In order to analyze the competition existing in an industry, Porters came up with 5


forces that may influence the profit potential of the industry. These 5 forces are:
 Threat of new entrants
 Rivalry among existing firms
 Threat of substitute products or services
 Bargaining power of buyers
 Bargaining power of suppliers

40
If all these forces are high, then the companies present in the industry are more
limited to raise prices and earn greater revenues. Therefore, according to this model, a
high force is regarded as a threat and a low force is regarded as an opportunity. We
will now analyze the biscuit industry in relation to these 5 forces and understand the
profitability and attractiveness of this industry.

Threat of New Entrants


New entrants in an industry bring to it new capacity and a desire to gain market share.
Therefore, they are a threat to the existing companies. But the entrance of new players
depends on the entry barriers affecting the industry. For the FMCG industry, it is very
hard for a new company to enter as it requires high product differentiation and a
strong distribution network.

However, the biscuit industry is attractive to new players as higher disposable income
and the willingness of consumers to try new products gives them an opportunity to
make good profit.

Also, this industry is extremely price sensitive and therefore does not give much
flexibility to the companies to increase prices. They depend on the agricultural sector
for raw material, due to which they do not have control on the cost incurred for raw
material purchase. If the cost of wheat goes up or it’s a bad crop, they have to import
raw material from outside, thereby increasing their cost of production. These factors
make it hard for new companies to enter the industry, and bring down the industry
attractiveness. Furthermore, it is a slow growing industry, with the current growth rate
of 13%. The government policies regarding tax and excise duty is another barrier for
new entrants, while commodities like tea and coffee are liable for VAT of 4% and no
excise duty, biscuits are liable for VAT of 12.5% and an excise duty of 8%.

It has been seen in the biscuit industry that many new players like HLL and Cadbury
tried to enter with new products, but could not establish themselves successfully. Only
one new player, ITC ltd managed to push its way through and grab a market share of
6-8%. Therefore, for the biscuit industry, there is not too much threat of new entrants.
This force can be rated as medium.

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Rivalry among existing firms

In any industry, companies are mutually dependent on each other, i.e. neither can
ignore the changes or competitive moves made by the other players. A new strategy
implemented by one company to gain competitive advantage is always countered by
some changes made by the other company to neutralize that competitive advantage. In
any industry, it is a constant was between companies, but the degree of rivalry may
vary. This depends on a lot of factors.

In the biscuit industry, there are three main players; Britannia, Parle, and ITC ltd.
Other regional players like PriyaGold and Bakeman also exist, but they only give the
bigger firms competition in certain geographical areas. Britannia and Parle hold
almost equal market share, where as ITC ltd holds a relatively lower market share, but
is growing at a fast rate and implementing strategies to pull away part of the market
share from the big guys. As there are only three firms competing at all levels, they can
keep a close watch on the changing strategies of each other. There is very close
competition between all three, and the smallest of changes in policies by one has to
countered immediately by some changes in the other, in order to stay in the game.
Therefore, rivalry among firms can be rated as a high force.

Threat of Substitute Products


Existence of substitute products in an industry puts a ceiling on the price the
companies can charge for higher profitability. Tea and coffee are regarded as
substitutes of one another as they solve the same purpose. Therefore, if tea prices
were to rise, then tea drinkers might begin to shift towards consuming coffee. This
shows that the price of coffee puts a price ceiling on tea. Tea manufacturers cannot
increase their price as there is a threat that they may lose their market share to the
substitute products.

The substitutes of biscuits are namkeens, chips, potato wafers, rusks etc. Biscuits are
usually eaten as snacks with tea/coffee, or as a substitute for a meal when there is lack
of time. Therefore, if prices of biscuits rise, there will be a shift from consumption of
biscuits to consumption of rusks, chips etc. However, biscuits are now part of
people’s everyday life. It may not be a necessity like bread, but it is an integral part of

42
people’s life style. One may expect consumers in rural areas to shift to rusks or
wafers, but it might not be too prominent in the urban areas.

Biscuits are a low priced commodity, therefore a small increase in price would be
acceptable in urban areas but may cause a shift to substitutes in rural areas. The threat
of substitutes can be rated as a medium force for the biscuit industry.

Bargaining power of buyers


Bargaining power of buyers is the ability of the buyers to force down prices. If there
are alternate suppliers of the same product, then the buyers have the option of shifting
to another supplier if their original supplier does not meet their requirements and
demands. In the biscuit industry, consumers have the option of shifting brands
according to their liking of price, quality and taste. This does not give much flexibility
to the biscuit manufacturers to increase price, or compromise of quality.

Also, with bakery stores mushrooming everywhere and providing biscuits for bulk
purchases in kilograms, consumers today have the option of buying from them as
well. They provide flavors that the packed biscuits do not and they sell any quantity
that the consumer requires, from 100 grams to kilograms. This further increases the
bargaining power of the buyers. Therefore, this force is high in the biscuit industry.

Bargaining power of suppliers


Suppliers have the ability to raise their prices and increase cost of production for the
manufacturing firms. In the biscuit industry, the main ingredient required for baking
biscuits is wheat. Therefore, their raw material is dependent on the agricultural
industry. During times of inflation when the price of wheat goes up, biscuit
manufacturers have no choice but to purchase wheat at the price quoted by the
farmers as wheat does not have a close substitute. Therefore the bargaining power of
suppliers is high.

OPERATION STRATEGY

Products are sourced from several manufacturing locations spread across the country
and reach millions of consumers through an efficient and widespread distribution

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chain. They have been augmenting our manufacturing facilities to meet the growing
demand. The Britannia system has invested over Rs 200 crore in the last two years in
capacity expansion. They also plan to make substantial investments in this area for the
next couple of years too.

BRITANNIA’S ORGANIZATIONAL STRUCTURE

Britannia Industries ltd follows the Strategic Business Unit structure. In this structure,
each strategic business unit is a group of individual product segments and has the
primary responsibility of managing their own functional areas. They have their own
unique mission and identifiable competition. This helps the company to decentralize
on the basis of strategic element. Britannia has three independent business units,
Biscuits, Bakery and Dairy products. Each of these units has separate strategies
implemented by the management to promote and sell their products. The biscuit unit
is the most developed unit of them all, facing stiff competition from other big players.
The dairy unit is also relatively visible in the dairy industry, though it has players like
Amul to compete with.

COMPETITIVE ADVANTAGES

 By marketing itself as a healthier alternative, however, Britannia seeks to


sharply differentiate itself from other brands -- and that move has paid off. For
instance, with the introduction of the "Eat Healthy, Think Better" campaign in
1997, Britannia focused on building its individual brands, such as Tiger
glucose biscuits, Good Day cookies and Treat cream biscuits
 Advantage through efficiency: Investments in people, brands and
infrastructure, improved efficiencies and cost reduction, and new choices for
consumers.
 Britannia came out with smaller pack formats and different SKUs to target the
travelling segment. And also with the `Greetings' gift pack during Diwali last
year to make the emotional connect both with individuals and institutions

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CHAPTER 3
RESEARCH METHODOLOGY

Research methodology is considered as the nerve of the project. Without a proper well
organized research plan, it is impossible to complete the project and reach to any
conclusion. The project was based on the survey plan. The main objective of survey
was to collect appropriate data, which work as a base for drawing conclusion and
getting result. Therefore, research methodology is the way to systematically solve the
research problem. Research methodology not only talks of the methods but also logic
behind the methods used in the context of a research study and it explains why a
particular method has been used in the preference of the other methods.

RESEARCH DESIGN
The research design refers to the overall strategy that you choose to integrate the
different components of the study in a coherent and logical way, thereby, ensuring
you will effectively address the research problem; it constitutes the blueprint for the
collection, measurement, and analysis of data.

A research design is the arrangement of conditions for collection and analysis of data
in manner that aims to combine relevance to the research purpose with economy in
procedure .In fact, the research design is the conceptual structure within which
research is conducted; it constitutes the blueprint for the collection, measurement and
analysis of data.

Research Objectives
 To study about the marketing strategy of Britannia Biscuits.*
 SWOT Analysis of Britannia Biscuits.*
 To study about the Product Line of Britannia Biscuits.*

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SOURCE OF DATA

Data collection is the process of gathering and measuring information on variables of


interest, in an established systematic fashion that enables one to answer
stated research questions, test hypotheses, and evaluate outcomes.

Data compilation is an intermediate stage between data collection and analysis. Data
compilation involves classification and summarization in order to make data
amenable to analysis.

In dealing with any problem, once the sample has been selected the data must be
collected from the sample population. There are several ways of collecting
appropriate data which differ considerably in context of money cost, time and other
resources. They can be broadly classified in to two categories:

Two sources to collect data are:


1. Primary Source
2. Secondary Source

 The Primary source of data collection is the tool in which the data is collected
with the help of a direct survey, questionnaire directly asked from the focus
group, observations etc.

 The Secondary source of data collection is the way through which data is
collected with the help of secondary sources like Internet, Magazines,
Newspaper, Newsletter, and many other mediums.

In this project report the data was collected through secondary source, i.e. through
other reports, projects. Since the time was strict for the other source to pursue.

This project report is designed to be exploratory in nature, as the main purpose of this
project is to identify and study the marketing strategy of Britannia Biscuits.

46
Data Collection Instrument

Accurate and systematic data collection is critical to conducting scientific research.


Data collection allows us to collect information that we want to collect about our
study objects. Depending on project, methods of data collection includes: documents
review, observation, questioning, measuring, or a combination of different methods.
The sources for the data collection is Secondary. I used the Survey method to gather
information. Some of the information has taken from the website of Britannia and also
it is studied that how Britannia itself uses the Survey method to collect information
from its consumers. Britannia uses the online consumer survey method (Feedback
Form) through which it can gather information about the experiences of the
consumers with its products and services.

POPULATION & SAMPLING

A research population is generally a large collection of individuals or objects that is


the main focus of a scientific query. It is for the benefit of the population that
researches are done. However, due to the large sizes of populations, researchers often
cannot test every individual in the population because it is too expensive and time-
consuming. This is the reason why researchers rely on sampling techniques.

A research population is also known as a well-defined collection of individuals or


objects known to have similar characteristics. All individuals or objects within a
certain population usually have a common, binding characteristic or trait.

The Secondary data is used for their sampling and population where a marketing
questionnaire was used already. These Questions were asked from the Kids and their
Mothers which included who were generally 30-60 years and Kids of age 6-12. India
is not a developed country and but Britannia is a brand about which everyone knows
everything. Many children were asked randomly about a pack of biscuit that to which
company it belongs to.

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RESULTS AND FINDINGS

The story of one of India's favourite brands reads almost like a fairy tale. Once upon a
time, in 1892 to be precise, a biscuit company was started in a nondescript house in
Calcutta (now Kolkata) with an initial investment of Rs. 295. Initially, biscuits were
manufactured in a small house in central Kolkata. Later, the enterprise was acquired
by the Gupta brothers mainly Nalin Chandra Gupta, a renowned attorney, and
operated under the name of "V.S. Brothers." In 1918, C.H. Holmes, an English
businessman in Kolkata, was taken on as a partner and The Britannia Biscuit
Company Limited (BBCo) was launched. The Mumbai factory was set up in 1924 and
Peek Freans UK, acquired a controlling interest in BBCo. Biscuits were in demand
during World War II, which gave a boost to the company’s sales.

As time moved on, the biscuit market continued to grow and Britannia grew along
with it. In 1975, the Britannia Biscuit Company took over the distribution of biscuits
from Parry's who till now distributed Britannia biscuits in India. In the subsequent
public issue of 1978, Indian shareholding crossed 60%, firmly establishing the Indian
origin of the firm. The following year, Britannia Biscuit Company was re-christened
Britannia Industries Limited (BIL). Four years later in 1983, it crossed the Rs. 100
crores revenue mark. On the operations front, the company was making equally
dynamic strides. In 1992, it celebrated its Platinum Jubilee. In 1997, the company
unveiled its new corporate identity - "Eat Healthy, Think Better" - and made its first
foray into the dairy products market. Britannia strode into the 21st Century as one of
India's biggest brands and the pre-eminent food brand of the country. It was equally
recognized for its innovative approach to products and marketing. In recognition of its
vision and accelerating graph, Forbes Global rated Britannia 'One amongst the Top
200 Small Companies of the World', and The Economic Times pegged Britannia
India's 2nd Most Trusted Brand.
Today, more than a century after
those tentative first steps, Britannia's fairy tale is not only going strong but blazing
new standards, and that miniscule initial investment has grown by leaps and bounds to
crores of rupees in wealth for Britannia's shareholders. The company's offerings are
spread across the spectrum with products ranging from the healthy and economical
Tiger biscuits to the more lifestyle-oriented Milkman Cheese. Having succeeded in

48
garnering the trust of almost one-third of India's one billion population and a strong
management at the helm means Britannia will continue to dream big on its path of
innovation and and quality.

The basis for the questionnaire was just to check the knowledge of the focus group
and tell them about some good benefits of Britannia biscuits.

The results and findings which were founded was already in the website of Britannia
and it included that Britannia did sampling and population. Britannia selected a focus
group from the total population; the focus group was the representative of the whole
population. This focus group included children below age of 08 years and their
parents near age of 30 -45 years. Britannia prepared a questionnaire and asked it from
the focus group including the children and their parents.

It was found that more than 75% of the total population knew about Britannia. They
did know that what is the business of Britannia and what are the products it offers.

It was found that more than 80% population of children knew about who are the other
companies who sell biscuits also. The children replied the question amazingly as they
knew about the company and they told that this is their favourite brand. They also
mentioned that the biscuit Tiger is also healthier for our body. Parents of the children
were also amazed as they didn’t expect this from children under age of 08 years. One
more surprising fact was that many of parents didn’t knew about the answers of these
questions, as they knew that what is the business of Britannia but they didn’t know
that what is the favourite brand of their children which provide a full range of biscuits,
rolls, cookies, and gift packs also.

The Results of this questionnaire were found by us through some magazines,


Newspapers, and Internet.

49
CHAPTER 4

RECOMMENDATIONS

GDP: With respect to GDP, we expect Britannia to perform on current lines with the
National GDP. The recessionary environment makes for overall growth picture
gloomy. However, we expect Britannia to attain a GDP of 4.5-5% in the FY 2009-
2010.

With funds flowing into the economic and banking systems, it is expected that the
global economics would again see the bull rally from FY 2010-11. In this year, we
expect Britannia to get a GDP of 6-6.3% in the most likely scenario.

Interest rate: Interest rates have fallen considerably and the government may further
cut the rates to infuse liquidity in the markets. Thus, we expect int. rates to go down
vis-à-vis expansion plans. We assume it to stand at 1,25,000 in FY 09-10 in the most
likely scenario.

Inflation: The inflation has seen a drastic down in the current times. The overall
country’s inflation rate may even go in the red. This could work as a double edges
sword for Britannia. Cost reduction could be coupled with the reduction in sales . We
assume the inflation to stand at 2% in FY 2009-10 and at 5% in FY 2010-11 in the
most likely scenario.

 But now Britannia wants to broaden its menu. In addition to growing its core
biscuit business, it wants to significantly expand its small businesses including
dairy, bread, cake and rusk (known as zwieback in the U.S.). The dairy
business, which Britannia entered in 1997 and spun off as a joint venture with
New Zealand's Fonterra Group in 2002, has revenues of barely $36 million
and has yet to become profitable.
 It can also enter International market besides Middle East and Srilanka.
 If it plans to become a player in the food industry, it needs to enter it to
include fruits and vegetables, dairy products, marine and fish, meat and
poultry, breads and bakery, confectionary and packaged foods, and alcoholic
and non-alcoholic beverages.

50
 The company needs to do horizontal integration which should include
breakfast items and ready-to-cook and ready-to-eat products
 The biscuit industry uses indigenously grown agricultural produce thereby
adding to the income of farmers. This is a direct contribution of the industry
towards improvement of agricultural sector. The industry also provides direct
employment to approximately 3lakh people & indirectly impacts employment
of about 35lakh people. Therefore, Britannia should invest heavily in
agriculture as well to gain the maximum outcome.

51
CONCLUSION

Britannia - the 'biscuit' leader with a history - has withstood the tests of time. Part of
the reason for its success has been its ability to resonate with the changes in consumer
needs-needs that have varied significantly across its 100+ year epoch. With consumer
democracy reaching new levels, the one common thread to emerge in recent times has
been the shift in lifestyles and a corresponding awareness of health.

People are increasingly becoming conscious of dietary care and its correlation to
wellness and matching the new pace to their lives with improved nutritional and
dietary habits. This new awareness has seen consumers seeking foods that
complement their lifestyles while offering convenience, variety and economy, over
and above health and nutrition.

Britannia saw the writing on the wall. Its "Swasth Khao Tan Man Jagao" (Eat
Healthy, Think Better) re-position directly addressed this new trend by promising the
new generation a healthy and nutritious alternative - that was also delightful and
tasty.

Thus, the new logo was born, encapsulating the core essence of Britannia - healthy,
nutritious, and optimistic - and combining it with a delightful product range to offer
variety and choice to consumers

Most consumers believe that to in order to stay healthy one needs to make certain
compromises on some good things in life. Whether it is missing that extra hour of
sleep over early morning exercise, or eating unappetizing foods over that extra oil-
dripping samosa. At the same time most of us agree that good nutrition cannot come
from one kind of food alone, but from a healthy combination / assortment of several
healthy ingredients put together. Britannia Nutri Choice 5 Grain Biscuits are a perfect
answer to those looking for healthy eating options without as much making a
compromise on taste, or convenience, or health.

52
BIBLIOGRAPHY

 BOOKS - PHILIP KOTLER, MARKETING MANAGEMENT, PRENTICE


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TO 46
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QUESTIONNAIRE

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