Product Management- A Case of Amul

Amul is the largest co-operative movement in India with 2.2 million milk producers organized in 10,552 co-operative societies in 2003-2004. As a brand it symbolizes high quality product at reasonable prizes. In butter, cheese and saturated fats, Amul has remained the undisputed market leader since its inception in 1955. Amul followed a unique business model, which aimed at providing 'value for money' products to its consumers, while protecting the interests of the milk-producing farmers who were its suppliers as well as its owners. The Brand: Amul Amul brand has been extremely successful. As a brand, Amul is a name widely recognized and respected, not just in our cities and towns, but in our villages as well. Probably the easy, but nonetheless wrong, answer is that Amul has been advertised well. Today Amul is a symbol of many things, of high-quality products sold at reasonable prices, of the genesis of a vast co-operative network, of the triumph of indigenous technology, of the marketing savvy of a farmers' organization and of a proven model for dairy development. Some of the value propositions that have resulted in success of Amul are: 1. Quality: Equaling or exceeding the buyers expectations with good taste. 2. Value for money: While earning a good income for our owners the dairy farmers of Gujarat value is delivered for cost. 3. Availability: Having nations finest distribution network, it is available when and where the customer wants it. 4. Service: Being committed to total quality and having an appropriate service recovery mechanism in place in case of a service failure. The main secret of success of Amul is The People power: Contrary to the traditional system, when the profit of the business was cornered by the

middlemen, the system ensured that the profit goes to the participants for their socio-economic upliftment and common good. The Dairy Industry Dairy products in India is seeing a healthy growth of almost 10% in current value terms in 2004, to post sales of up to Rs89 billion. This robust growth can be attributed chiefly to packaged milk, which saw healthy growth arising from the switch to branded milk among middle-class consumers and the rural affluent. Cheese and flavored milk drinks are projected to experience robust growth over 2004, albeit from a small base. With current value growth rates of 14% and 27% respectively, both products collectively account for merely 9% of total dairy value sales in the year. Typical structure of the Indian dairy industry is given below

Butter Market of India Following are some of the typical characteristics for butter market of India Traditional product, dominated by unorganized sector Branded butter available - salted and unsalted Co-operatives dominate organized segment

Major brands (manufacturers) - Amul (GCMMF), Vijaya (AP), Aavin (TN), Nandini (Karnataka) New Entrant: Britannia Given its high income elasticity, the demand for milk and dairy products is expected to grow rapidly. A study conducted by Saxena (2000) using National Sample Survey (NSS) data for 1993--94 showed that income elasticity of demand for milk and milk products is higher (1.96 national level) in rural areas (ranging from 1.24 in Punjab to 2.92 in Orissa) than in urban areas (ranging from 0.99 in Punjab to 1.78 in Bihar).

Future of Dairy Industry in India The major determinant in any projection of the demand for milk and milk products is the burgeoning middle class with increasing purchasing power. The demand for milk is placed at 70 to 80 MT in the next decade, providing excellent opportunities for the growth of the dairy industry. India should have a competitive advantage in the international market, and it is hoped that the Indian dairy industry will seize the opportunity to develop overseas markets for milk powders and varieties of cheese, the costs of which are expected to go up in the major milk producing countries. To make inroads into the export markets, it is not enough if prices alone are competitive. It is equally necessary that the quality of the products be up to international standards. The dairy industry should exercise vigilance and the extension services of the country should be toned up to ensure clean milk production. It is essential that the dairy plants maintain excellent standards of hygiene at all stages of production.

The Organization: Gujarat Cooperative Milk Marketing Federation Gujarat Cooperative Milk Marketing Federation (GCMMF) is India's largest food products marketing organization. It is a state level apex body of milk cooperatives in Gujarat which aims to provide remunerative returns to the farmers and also serve the interest of consumers by providing quality products which are good value for money. Its sales turn over in period 1994-96 is Rs 11140 million and $355 million. Its flagship brand Amul has become one of the best recognized brand names in India with turnover of Rs. 29 billion in 2004. Brand Identity of Amul It is a unique set of brand associations that the brand strategist aspires to create or maintain. These associations represent what the brand stands for and imply a promise to customers from the organization members. In case of Amul, which was born in the villages of India, it went in to create successfully the Taste of India. It tries to embody the cultural values that are unique to India, and no festival can really be complete without a little bit of Amul in it. Amul butter which was launched in 1945 had a very staid image, till in 1966 when ASP advertising agency clinched the amul account. The objective was to create a relationship between the main customers i.e. the housewives and the brand Amul. This led to the creation of one of the most successful campaign of India, whose charm has endured fickle public opinion, gimmickry and all else. A girl

who would worm her way into a housewife's heart, the Amul girl from then on played the role of a social observer. From the Sixties to the Nineties, the Amul ads have come a long way, still the element of provocative humour remains. The association created was that of pure and simple fun, which along with the personality of a socially conscious observer of the Amul girl went a long way in achieving the brand identity objective. The next and effective campaign was The taste of India one where Amul tried to project itself as truly Indian ,which incorporated Indian values and the feeling of pride at being indigenous. (The roots of Amul in Indian Villages / Cooperative). To study the brand identity of Amul, the prism model was taken into consideration. The brand prism for Amul is as shown in the diagram below:

PHYSIQUE
Amul girl Slogan The taste of India the punch line

PERSONALITY
Innocent Patriotic

RELATIONSHIP
Socially evocative Friend

Triumph of indigenous technology Priceless yet reasonable

CULTURE
Indian values Cooperative

REFLECTION
Modern and stable Social observer

SELF-IMAGE
Socially responsible Truly Indian Health-Conscious

Components of Brand Identity: 1. PHYSIQUE: a) The Amul girl: Every Friday since 1967, this little girl appears on billboards, strategically placed all over India, focusing on the item of the week -- tongue in cheek, of course.

b) The punch line: Utterly, Butterly, delicious c) The slogan: Taste of India d) Use of humour: "Hing-lish" (a combination of Hindi and English) punchlines, and evocative humour.

2. PERSONALITY: The brand as a personality will come across as someone patriotic as shown in its adds and the famous jingle the taste of India .Along with that the Amul girl and her comments on daily issues in the advertisements lend a bit of innocence to the personality. 3. RELATIONSHIP: Amul is always said to be playing the role of a "social observer with evocative humor," the billboards became, and still are, a topic of conversation amongst millions.

4. CULTURE: Amul was born in the villages of India and it went to create `The taste of India. It embodies the cultural values that are unique to India, and the images showing the cooperative nature of business in case of Amul the culture is shown as truly cooperative in terms of commitment to the producer and consumer. 5. REFLECTION: As shown in the advertisements of Amul the perceived user is someone who is modern, aware of social issues and stability seeker in nature. The stability seeking quality comes from the fact that this ideal user is sticking to Amul or so many years because of its superior quality, reliability and ease of usage. 6. SELF-IMAGE: The advertisements generate a image of a true Indian with core Indian values, who is proud of his roots. Since Amul come from the villages of India it makes oneself very proud of its indigenousness. Along with that the tongue in cheek advertisements involving daily issues on the hoardings and back of the package wants to generate and image of being socially aware of the surroundings. Challenges for the Future Though Amul is a successful story, but it is facing a stiff competition from other key players of business and from multinational firms. Amul has a wider product portfolio and it has got both related and un related extension over the years. As a product manager develop a product management strategy and rationalize the product portfolio of Amul as a brand and suggest what role should Amul Butter play in the over all product management of Amul brand.