GAUHATI UNIVERSITY

A Training Report submitted in partial fulfillment of the requirements for the award of Degree of the Bachelor of Business Administration (Industry Integrated), Gauhati University on IMPACT OF ADVERTISING An A.P. Dairy Product BE WATER SMART

Under Organization Guidance Of : Mr. Ravi Dandu Head of Marketing Vijaya Waters

Under Institutional Guidance Of : Mrs. Srivani Faculty Hyderabad, Andra Pradesh.

Prepared And Submitted By : Syed Adam Vali G.U. Registration No. 10-02-0116 of 2010-2013

A PROJECT REPORT ON IMPACT OF ADVERTISING AT A.P.DIARY (VIJAYA) HYDERABAD Submitted to GAUHATI UNIVERSITY Hyderabad- 500 007 Project submitted in partial fulfillment of the requirements for the award of the degree of Bachelor of Business Administration (B.B.A) SYED ADAM VALI UNDER THE GUIDANCE OF Mrs. P. Srivani SUN INSTITUTE OF TECHNOLOGY AND MANAGEMENT (Affiliated to Gauhati University, Guwahati) HYDERABAD-AP (2010-2011)

STUDENTS DECLARATION

I hereby declare that the Training Report conducted at VIJAYA PACKAGED DRINKING, ARK BEVERAGES Pvt. Ltd., An A.P. DAIRY PRODUCT.

Under the guidance of MRS. P. SRIVANI

Submitted in Partial fulfilment of requirements for the Degree of BACHELOR OF BUSINESS ADMINISTRATION (Industry Integrated) TO GAUHATI UNIVERSITY, GUWAHATI.

Is my original work and the same has not been submitted for the award of any other Degree/diploma/fellowship or other similar titles or prizes.

Place: Date:

Syed Adam Vali Reg.No.10-02-0116

CERTIFICATE This is to certify that Syed Adam Vali, a student of the Gauhati University has prepared his Training Report entitle Impact of Advertising under my guidance. She has fulfilled all requirements under the regulations of the MBA (IIP) & BBA (IIP) Gauhati University, leading to the B.B.A (IIP) degree. This work is the result of his own investigation and the project; neither as a whole nor any part of it was submitted to any research or diploma.

I wish him all success in life.

HEAD OF THE ACADEMIC PARTNER (SUN INSTITUTE OF TECHNOLOGY AND MANAGEMENT)

INTERNAL GUIDE

EXTERNAL EXAMINER

CERTFICATE OF THE ORGANISATION To, The Director NIAM Bangalore / New Delhi. . This is to certify that Mr SYED ADAM VALI of BBA (Industry Integrated) course of Gauhati University at Sun Institute of Technology and Management Academic partner has undergone management training at our Organisation from 1st March 2011 to 31st March 2011.

His performance during the training period was GOOD.

Authorized Signatory

ACKNOWLEDGEMENT

I take this privilege to express my sincere gratitude towards A.P.DIARY (VIJAJA) for giving this opportunity to carry out my project work in their esteemed organization. I thank Mr. RAVI DANDU and Mr. RAJ GOPAL our trainers for their valuable guidance, advise, suggestion and Cooperation throughout my project work and for having permitted me to undertake project and providing me immense support in its successful completion. I express my profound gratitude to my guide Mrs. P. Srivani for her guidance. I also thank Director Vani and the other staff members of the college and training officers of NIAM for having guided and motivated me.

I also wish to thank my parents, friends and relatives who have been directly or indirectly involved in the completion of my project work.

SYED ADAM VALI Roll no: 10-02-0116

TABLE OF CONTENTS

CHAPTER 1 INTRODUCTION
1.1 General introduction about the sector. 1.2 Industry profile. a. Origin and development of industry b. Growth and present status of the industry. C. Future of the industry.

CHAPTER 2 PROFILE OF THE ORGANISATION

2.1 Origin of the organization. 2.2 Growth and development of the organization. 2.3 Present status of the organization. 2.4 Functional departments of the organization. 2.5 Organization structure and organize institution for any research. 2.6 Product and service profile of the organization competitors. 2.7 Market profile of the Organization.

CHAPTER 3 DISCUSSIONS ON TRAINING

3.1 Students work profile (role and responsibilities), tools and Techniques used. 3.2 Key learnings.

CHAPTER 4 STUDY OF SELECTED RESEARCH PROBLEM

4.1 Statement of research problem. 4.2 Statements of research objectives. 4.3 Research design and methodology.

CHAPTER 5 ANALYSIS
5.1 Analysis of data. 5.2 Summary of findings.

CHAPTER 6 SUMMARY AND CONCLUSIONS

6.1 Summary of learning experience. 6.2 Conclusions and Recommendations.

APPENDIX

(SAMPLE QUESTIONNAIRE)

BIBILOGRAPHY

CHAPTER 1 INTRODUCTION SECTOR AND INDUSTRY PROFILE

Introduction
India primarily depends on mansoon rains for all its Water requirements. The fresh surface flowing Water which used to be the major source for drinking Water has been depleting and also not at par with the demand for safe drinking Water due to the population growth. So the ground Water has arised as the next major source of fresh Water for drinking as well as for farming. Though the amount of drinkable Water resources is more than the surface Water, the over consumption, uneven dissolved mineral contents has opened up a huge market for fresh, safe drinking Water i.e. A market to sell Water as a consumer product. The Packaged Drinking Water industry was over grown and the supply has surpassed the demand. The no. of private Packaged Drinking Water plants in Andhra Pradesh are over 500 with varying production capacities. This leaves an opportunity for a Zero Infrastructure Business Model. A business model which uses the existing infrastructure in the industry and cuts the fixed assets of doing business to zero or almost zero while converting all the fund requirements and cashflows into varible costs. The risk of doing business, capital requirements reduces and liquidity of fund increases. The basic concept here is to use the existing Packaged Drinking Water plants in selling in Water by making a brand.

Brand VIJAYA
Brand VIJAYA has good market potential for milk and processed milk products in Andhra Pradesh. It is known as the government FMCG brand in Andhra Pradesh. VIJAYA is a trademark of Andhra Pradesh Dairy Development Co-Operative

Federation Ltd. (APDDCF Ltd.). Brand VIJAYA sells over 25lakh liters of milk per day in Andhra Pradesh. APDDCF Ltd. has a well established distribution channel and network across Andhra Pradesh. For instance, Just the milk products (not considering the liquid milk) have 2000 sales points i.e. VIJAYA Milk Booths, in Hyderabad. This simplifies the process of lauching new products under VIJAYA banner or reduce the entry barries in scaling up the market to reach consumers in a quick and less expensive way. So it is rationale to use an existing well known brand with good distribuiton network to upstart the business over starting a new brand.

Marketing Strategy
M/S. Surabhi Enterprises with 8 years of experience in Packaged Drinking Water business has entered an agreement with APDDCF Ltd. to manufacture, sell and market Packaged Drinking Water under the brand name VIJAYA. APDDCF Ltd. Being a state government organization, APDDCF Ltd. also agreed to sell (or replece the existing) Packaged Drinking Water usage with VIJAYA Packaged Drinking Water at the government organizations like AP Tourism, APSRTC, Govt. Hospitals, IRCTC (Indian Railways), Tirumal TIrupathi Devastanam (TTD), Secrateriat & Assembly, etc. We will be extending this to all the govt. organizations once we reach the full capacity of supply. We can use the entire existing distribution network of VIJAYA in Andra Pradesh. Along with the existing governament organizational usage, we are also selling in the open market with all the pack sizes. Our main focus is into selling 20 Liter jars which come under Regular consumption segment. We use the distributors, stockists, retailers in

selling to the Random consumption segment.

Table 1: The pack sizes and the maximum retail prices

S. No.

Pack Size 1 250 ml 2 750 ml 3 1 Liter 4 2 Liter 5 20 Liter

M.R.P (Rs) 5 12 15 25 30

Considering the demographys and purchasing power, we are focusing on the urban areas. So One manufacturing plant per municipality area is required. We are looking to acquire over 100 plants (as Contract Manufacturers) to fill & sell only 20Ltr (Two Way Packs) jars and another 4 plants to manufacture the other pack sizes (One Way Packs) across the state with in a time period of one year. Initially, We are looking to start with 25 manufacturing plants across the major urban areas for 20 Ltr jars.

MARKETING
Marketing is a social process by which individuals and groups obtain what they need and want through creating and exchanging products and values with others.

Philip kotler defines marketing as SATISFYING NEEDS AND WANTS THROUGH AN EXCHANGE PROCESS

THE NINE FUNCTIONS OF MARKETING

In order for the marketing bridge to work correctly--providing consumers with opportunities to purchase the products and service they needthe marketing process must accomplish nine important functions. The functions are: Buying people have the opportunity to buy products that they want. Selling producers function within a free market to sell products to consumers. Financing banks and other financial institutions provide money for the production and marketing of products. Storageproducts must be stored and protected until they are needed. This function is especially important for perishable products such as fruits and vegetables Transportationproducts must be physically relocated to the locations where consumers can buy them. It includes rail, road, ship, aero plane, truck and etc. Risk-takinginsurance companies provide coverage to protect producers and marketers from loss due to fire, theft or natural disasters. Market informationinformation from around the world about market conditions, weather, price movements and political changes can affect the marketing process. Grading and Standardizingmany products are graded in order to conform to previously determined standards of quality. Marketing-mix is the marketing managers instrument for attainment of marketing goals. It is composed of four ingredients: (1) product (2) pricing (3) promotional activities (4)

physical distribution. These elements constitute the core of the marketing system of a firm. Product Every product is subject to life cycle including a growth phase followed by an eventual period of decline as the product approaches market saturation.

Price The price is the amount a customer pays for the product. The business may increase or decreases the product if other stores have the same product.

Place Place represents the location where a product can be purchased. It is often referred to as the distribution channel.

Promotion represents all of the communications that a marketer may use in the market place. Promotion has four distinct elements: advertising, public relations, personal selling and sales promotion. Sales staff often plays an important role in word of mouth and public relations.

CHAPTER 2 PROFILE OF THE ORGANISATION (A.P.DAIRY, VIJAYA)

COMPANY PROFILE
Vijaya Dairy & Farm Products (P) Ltd. started in 1995 as a committed vision to procure surplus cow milk from the farmers and to pay reasonable price for the procured milk to produce milk and milk products through superior technology and process. We are, now a MMPO certified dairy company with processing capacity of 1,25,000 liters of cow milk per day, covering entire Tamil Nadu. The products produced include ghee, paneer, curd, butter milk, flavored milk in bottles, and khoa & spray drying unit is under progress. Located in Peramangalam, 25 KM away from Trichy in Tamil Nadu, Vijaya Dairy ensures the quality standards. There is in - house R&D and technical team to monitor every single aspect of production, which follows TQM, TPM and QC circles. Vijaya Dairy has also set up a demonstration dairy farm to educate milk producer in clean milk production, regulated feeding, disease control and genetic improvement of cows artificial insemination, vaccination, treatment of animals, loan arrangement for farmers and mass contact programs. Sri Vijaya Visakha Milk Producers Company Limited., [Visakha Dairy], Visakhapatnam in Andhra Pradesh, is having their procurement operations in Costal Andhra districts, vizag, Srikakulam, Vizianagaram, and Visakhapatnam & in East Godavari and Sales operations across India.

The Government after considering dairying as one of the instruments for bringing socio economic development in the rural areas, To overcome this object, the Dairy was started

in the year 1973 with handling capacity of 10000 liters per day in Visakhapatnam under cooperative act with milk procurement operations in 50 villages. Now the Dairy is procuring the milk from 2744 villages in Costal Andhra areas by serving 2,07,925 milk producers. The Dairy was converted to Mutually Aided Cooperative Act-1995 in the year 1999 as Sri Vijaya Visakha District Milk Producers Mutually Aided Cooperative Union' and the Dairy was converted to Company Act-1956 with effect from 06.01.2006 as Sri Vijaya Visakha Milk Producers Company Limited. The Procurement and Production graph growth is increasing year after year with more participation of the rural farmers. Now the Visakha Dairy is one of the fastest growing Milk & Milk Products Manufacturing organizations A statewide enterprise of co-operatives for dairy development, the Andhra Pradesh Dairy Development Co-operative Federation (APDDCF), as an enterprise of one million farmers for dairy development, had its genesis in 1981, with a three-tier cooperative structure.

Objectives:

Organize co-operatives of Milk Producers at village and district levels. Provide essential inputs to enhance milk production feed and fodder production, cross breeding programs, veterinary aid, and take up development programs to provide effective leadership and management skills to the milk producers to help them manage their own 9,200 Co-operatives.

 Develop infrastructure for processing of milk and manufacture of dairy products and market wholesome and quality milk and milk products. Fulfill the consumer needs of liquid milk and milk products in the State. Develop new products and packaging lines in tune with the changing scenario of consumer market and needs. Integrate dairy development with overall rural development efforts and provide greater employment to the rural poor. Today, there are 9,200 Co-operatives with 300 Women Co-operatives and a membership of over 8 lakhs people across the state.

Functions:

APDDCF offers the widest spectrum of milk products in India, under the brand name VIJAYA. APDDCF also manufactures products such as Sterilized Flavored Milk, paneer (indigenous unripened cheese), Doodh Peda (desiccated milk sweet) and Buttermilk which are marketed through a network of Vijaya Dairy Parlors and a chain of retailers spread across Andhra Pradesh. Provides job opportunities.

Organization:

As the years passed, APDDCF built up the infrastructure needed to meet every requirement of dairy development, be it procurement of milk from over 800,000 dairy farmers spread across Andhra Pradesh, be it chilling and processing 1.6 million liters of milk everyday or getting it ready for nationwide distribution. It all happened within the vast Dairy plant network of APDDCF. Through extensive use of high technology and management acumen honed to steer such a widespread operation, the organization brought prosperity to the State. The Federation has drawn up more comprehensive systems for procurement and processing of milk. A dedicated research cell is actively pursuing ways and means of bettering quality. Collaborations with global experts are also being sought, all in an attempt to remain at the forefront of modern dairy development in India where QUALITY will be the watchword.

Objective:
Our main object is to serve the farmers and to give help to their economical development, and provide Quality Milk & Milk Products to the Consumers Excellent Retail Franchisee Opportunity for Vijayas Winning Products APDDCF Intends to appoint 1000 Special Retail Outlets (Parlors & Kiosks) to market Vijaya Products

WE OFFER
Site design

 Free painting Free Signage Linkage of supply to Govt. Institutions Cooler & Freezer on attractive terms Kiosk on easy terms

WE REQUIRE
1 Financially strong parties willing to invest or show bank finance linkage around Rs.1,50,000. 2 Should have own / rented premises with a minimum of 10x10 for parlor or 6x6 for kiosk in prominent location. 3 Experience in selling FMCG / Food products / Beverages preferable 4 Allotment will commence immediately on FIRST COME FIRST SERVE BASIS with minimum formalities.

WE INVITE
Existing Retailers (Juice and Cool Drink stalls, Tea / Coffee Stalls, Bakery / STD Booth Water Drink etc.) Distributors having experience of Managing Franchisee parlors (Extra commission can be earned through distribution across their own network in parlors / kiosks / tricycle units for ice-cream)

 Colony / Apartment Associations including tie-ups for liquid milk supply also. Existing Milk Booth Agents of Liquid Milk Supply Existing canteens in offices, colleges, hostels, establishments Self employed youth with zeal for business.

Industry Profile

Indian dairy Industry - a profile

Today, India is 'The Oyster' of the global dairy industry. It offers opportunities galore to entrepreneurs worldwide, who wish to capitalize on one of the world's largest and fastest growing markets for milk and milk products. A bagful of 'pearls' awaits the international dairy processor in India. The Indian dairy industry is rapidly growing, trying to keep pace with the galloping progress around the world. As he expands his overseas operations to India many profitable options await him. He may transfer technology, sign joint ventures or use India as a sourcing center for regional exports. The liberalization of the Indian economy beckons to MNC's and foreign investors alike. Indias dairy sector is expected to triple its production in the next 10 years in view of expanding potential for export to Europe and the West. Moreover with WTO regulations expected to come into force in coming years all the developed countries which are among big exporters today would have to withdraw the support and subsidy to their domestic milk products sector. Also India today is the lowest cost producer of per liter of milk in the world, at 27 cents, compared with the U.S' 63 cents, and Japans $2.8 dollars. Also to take advantage of this lowest cost of milk production and increasing production in the country multinational companies are planning to expand their activities here. Some of these milk producers have already obtained quality standard certificates from the authorities. This will help them in marketing their products in foreign countries in processed form. The urban market for milk products is expected to grow at an accelerated pace of around 33% per annum to around Rs.43,500 crores by year 2005. This growth is going to come

from the greater emphasis on the processed foods sector and also by increase in the conversion of milk into milk products. By 2005, the value of Indian dairy produce is expected to be Rs 10,00,000 million. Presently the market is valued at around Rs7,00,000mn

Background
India with 134mn cows and 125mn buffaloes has the largest population of cattle in the world. Total cattle population in the country as on October'00 stood at 313mn. More than fifty percent of the buffaloes and twenty percent of the cattle in the world are found in India and most of these are milch cows and milch buffaloes. Indian dairy sector contributes the large share in agricultural gross domestic products. Presently there are around 70,000 village dairy cooperatives across the country. The cooperative societies are federated into 170 district milk producers unions, which is turn has 22-state cooperative dairy federation. Milk production gives employment to more than 72mn dairy farmers. In terms of total production, India is the leading producer of milk in the world followed by USA. The milk production in 1999-00 is estimated at 78mn MT as compared to 74.5mn MT in the previous year. This production is expected to increase to 81mn MT by 2000-01. Of this total produce of 78mn cows' milk constitute 36mn MT while rest is from other cattle. While world milk production declined by 2 per cent in the last three years, according to FAO estimates, Indian production has increased by 4 per cent. The milk production in India accounts for more than 13% of the total world output and 57% of total Asia's

production. The top five milk producing nations in the world are India, USA, Russia, Germany and France. Although milk production has grown at a fast pace during the last three decades (courtesy: Operation Flood), milk yield per animal is very low. The main reasons for the low yield are Lack of use of scientific practices in milching. Inadequate availability of fodder in all seasons. Unavailability of veterinary health services.

Milk Yield comparison:

Country Milk Yield (Kg's per year) USA UK Canada New Zealand Pakistan India 7002 5417 5348 2976 1052 795

World (Average)

2021

Source: Export prospects for agro-based industries, World Trade Centre, Mumbai.

Production of milk in India

Year 1988-89 1989-90 1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99

Production in million MT 48.4 51.4 53.7 56.3 58.6 61.2 63.5 65 68.5 70.8 74.7

1999-00(E) 2000-01(T)

78.1 81.0

E= estimated T= target / expected Source: DFPI, Annual Report-1999-2000

World's major milk producers Operation Flood

The transition of the Indian milk industry from a situation of net import to that of surplus has been led by the efforts of National Dairy Development Board's Operation Flood. Programme under the aegis of the former Chairman of the board Dr. Kurien.

1997-98 Country India USA 71 71

1998-99 (Approx.)

74.5 71

Russia Germany France Pakistan Brazil UK Ukraine Poland New Zealand Netherlands Italy Australia

34 27 24 21 21 14 15 12 11 11 10 9

33 27 24 22 27 14 14 12 12 11 10 10

Fresh Milk
Over 50% of the milk produced in India is buffalo milk, and 45% is cow milk. The buffalo milk contribution to total milk produce is expected to be 54% in 2000. Buffalo milk has 3.6% protein, 7.4% fat, 5.5% milk sugar, 0.8% ash and 82.7% Water whereas cow milk has 3.5% protein, 3.7% fat, 4.9% milk sugar, 0.7% ash and 87% Water. While presently (for the year 2000) the price of Buffalo milk is ruling at $261-313 per MT that

of cow is ruling at $170-267 per MT. Fresh pasteurized milk is available in packaged form. However, a large part of milk consumed in India is not pasteurized, and is sold in loose form by vendors. Sterilized milk is scarcely available in India. Packaged milk can be divided according to fat content as follows, Whole (full cream) milk - 6% fat Standardized (toned) milk - 4.5% fat Doubled toned (low fat) milk - 3% fat another category of milk, which has a small market is flavored milk.

Consumer Habits and Practices:

Milk has been an integral part of Indian food for centuries. The per capita availability of milk in India has grown from 172 gm per person per day in 1972 to 182gm in 1992 and 203 gm in 1998-99.This is expected to increase to 212gms for 1999-00. However a large part of the population cannot afford milk. At this per capita consumption it is below the world average of 285 gm and even less than 220 gm recommended by the Nutritional Advisory Committee of the Indian Council of Medical Research. There are regional disparities in production and consumption also. The per capita availability in the north is 278 gm, west 174 gm, south 148 gm and in the east only 93 gm per person per day. This disparity is due to concentration of milk production in some pockets and high cost of transportation. Also the output of milk in cereal growing areas is much higher than elsewhere which can be attributed to abundant availability of fodder, crop residues, etc which have a high food value for milch animals. In India about 46 per cent of the total milk produced is consumed in liquid form and 47

per cent is converted into traditional products like cottage butter, ghee, paneer, khoa, curd, malai, etc. Only 7 per cent of the milk goes into the production of western products like milk powders, processed butter and processed cheese. The remaining 54% is utilized for conversion to milk products. Among the milk products manufactured by the organized sector some of the prominent ones are ghee, butter, cheese, ice creams, milk powders, malted milk food, condensed milk infants foods etc. Of these ghee alone accounts for 85%. It is estimated that around 20% of the total milk produced in the country is consumed at producer-household level and remaining is marketed through various cooperatives, private dairies and vendors. Also of the total produce more than 50% is procured by cooperatives and other private dairies. While for cooperatives of the total milk procured 60% is consumed in fluid form and rest is used for manufacturing processed value added dairy products; for private dairies only 45% is marketed in fluid form and rest is processed into value added dairy products like ghee, makhan etc. Still, several consumers in urban areas prefer to buy loose milk from vendors due to the strong perception that loose milk is fresh. Also, the current level of processing and packaging capacity limits the availability of packaged milk. The preferred dairy animal in India is buffalo unlike the majority of the world market, which is dominated by cow milk. As high as 98% of milk is produced in rural India, which caters to 72% of the total population, whereas the urban sector with 28% population consumes 56% of total milk produced. Even in urban India, as high as 83% of the consumed milk comes from the unorganized traditional sector.

Presently only 12% of the milk market is represented by packaged and branded pasteurized milk, valued at about Rs. 8,000 crores. Quality of milk sold by unorganized sector however is inconsistent and so is the price across the season in local areas. Also these vendors add Water and caustic soda, which makes the milk unhygienic. India's dairy market is multi-layered. It's shaped like a pyramid with the base made up of a vast market for low-cost milk. The bulk of the demand for milk is among the poor in urban areas whose individual requirement is small, maybe a glassful for use as whitener for their tea and coffee. Nevertheless, it adds up to a sizable volume - millions of liters per day. In the major cities lies an immense growth potential for the modern sector. Presently, barely 778 out of 3,700 cities and towns are served by its milk distribution network, dispensing hygienically packed wholesome, quality pasteurized milk. According to one estimate, the packed milk segment would double in the next five years, giving both strength and volume to the modern sector. The narrow tip at the top is a small but affluent market for western type milk products.

Growing Volumes:
The effective milk market is largely confined to urban areas, inhabited by over 25 per cent of the country's population. An estimated 50 per cent of the total milk produced is consumed here. By the end of the twentieth century, the urban population is expected to increase by more than 100 million to touch 364 million in 2000 a growth of about 40 per cent. The expected rise in urban population would be a boon to Indian dairying. Presently, the organized sector both cooperative and private and the traditional sector cater to this market. The consumer access has become easier with the information revolution. The number of

households with TV has increased from 23 million in 1989 to 45 million in 1995. About 34 per cent of these households in urban India have access to satellite television channel.

Potential for further growth:

Of the three A's of marketing - availability, acceptability and affordability, Indian dairying is already endowed with the first two. People in India love to drink milk. Hence no efforts are needed to make it acceptable. Its availability is not a limitation either, because of the ample scope for increasing milk production, given the prevailing low yields from dairy cattle. It leaves the third vital marketing factor affordability. How to make milk affordable for the large majority with limited purchasing power? That is essence of the challenge. One practical way is to pack milk in small quantities of 250 ml or less in polythene sachets. Already, the glass bottle for retailing milk has given way to single-use sachets which are more economical. Another viable alternative is to sell small quantities of milk powder in mini-sachets, adequate for two cups of tea or coffee.

Marketing Strategy for 2000 AD:

Two key elements of marketing strategy for 2000 AD are: Focus on strong brands and product mix expansion to include UHT milk, cheese, ice creams and spreads. The changing marketing trends will see the shift from generic products to the packaged quasi, regular and premium brands. The national brands will gradually edge out the regional brands or reduce their presence. The brand image can do wonders to a product's marketing as is evident from the words of Perfume Princess Coco Channel: In the factory, we pack perfume; in the market, we sell hope!

Emerging Dairy Markets

Food service institutional market: It is growing at double the rate of consumer market Defense market: An important growing market for quality products at reasonable prices Ingredients market: A boom is forecast in the market of dairy products used as raw material in pharmaceutical and allied industries Parlor market: The increasing away-from-home consumption trend opens new vistas for ready-to-serve dairy products which would ride piggyback on the fast food revolution sweeping the urban India. India, with her sizable dairy industry growing rapidly and on the path of modernization, would have a place in the sun of prosperity for many decades to come. The one index to the statement is the fact that the projected total milk output over the next 15 years (19952010) would exceed 1457.6 million tonnes which is twice the total production of the past 15 years!

Penetration of milk products

Western table spreads such as butter, margarine and jams are not very popular in India. All India penetration of butter/ margarine is only 4%. This is also largely represented by urban areas, where penetration is higher at 9%. In rural areas, butter/ margarine have penetrated in 2.1% of households only. The use of these products in the large metros is higher, with penetration at 15%.

Penetration of cheese is almost nil in rural areas and negligible in the urban areas. Per capita consumption even among the cheese-consuming households is a poor 2.4kg pa as compared to over 20kg in USA. The lower penetration is due to peculiar food habits, relatively expensive products and also non-availability in many parts of the country. Butter, margarine and cheese products are mainly manufactured by organized sector. Similarly, penetration of ghee is highest in medium sized towns at 37.2% compared to 31.7% in all urban areas and 21.3% in all rural areas. The all India penetration of ghee is 24.1%. In relative terms, penetration of ghee is significantly higher in North and West, which are milk surplus regions. North accounts for 57% of ghee consumption and West for 23%, South & East together account for the balance 20%. A large part of ghee is made at home and by small/ cottage industry from milk. The relative share of branded products in this category is very low at around 1-2%. Milk powder and condensed milk have not been able to garner any significant consumer acceptance in India as indicated by a very low 4.7% penetration. The penetration is higher at 8.1% in urban areas and lower at 3.5% in rural areas. Within urban areas, it is relatively higher in medium sized towns at 8.5% compared to 7.7% in large metros.

Market Size and Growth:

Market size for milk (sold in loose/ packaged form) is estimated to be 36mn MT valued at Rs470bn. The market is currently growing at round 4% pa in volume terms. The milk surplus states in India are Uttar Pradesh, Punjab, Haryana, Rajasthan, Gujarat, Maharashtra, Andhra Pradesh, Karnataka and Tamil Nadu. The manufacturing of milk

products is concentrated in these milk surplus States. The top 6 states viz. Uttar Pradesh, Punjab, Madhya Pradesh, Rajasthan, Tamil Nadu and Gujarat together account for 58% of national production. Milk production grew by a mere 1% pa between 1947 and 1970. Since the early 70's, under Operation Flood, production growth increased significantly averaging over 5% pa. About 75% of milk is consumed at the household level which is not a part of commercial dairy industry. Loose milk has a larger market in India as it is perceived to be fresh by most consumers. In reality however, it poses a higher risk of adulteration and contamination. The production of milk products, i.e. milk products including infant milk food, malted food, condensed milk & cheese stood at 3.07 lakhs MT in 1999. Production of milk powder including infant milk-food has risen to 2.25 lakhs MT in 1999, whereas that of malted food is at 65000 MT. Cheese and condensed milk production stands at 5000 and 11000 MT respectively in the same year. (Source: Annual Report 1999-2000, DFPI)

Major Players:
The packaged milk segment is dominated by the dairy cooperatives. Gujarat Co-operative Milk Marketing Federation (GCMMF) is the largest player. All other local dairy cooperatives have their local brands (For e.g. Gokul, Warana in Maharashtra, Saras in Rajasthan, Verka in Punjab, Vijaya in Andhra Pradesh, Aavin in Tamil Nadu, etc). Other private players include J K Dairy, Heritage Foods, Indiana Dairy, Dairy Specialties, etc.

Amrut Industries, once a leading player in the sector has turned bankrupt and is facing liquidation.

Packaging Technology
Milk was initially sold door-to-door by the local milkman. When the dairy co-operatives initially started marketing branded milk, it was sold in glass bottles sealed with foil. Over the years, several developments in packaging media have taken place. In the early 80's, plastic pouches replaced the bottles. Plastic pouches made transportation and storage very convenient, besides reducing costs. Milk packed in plastic pouches/bottles have a shelf life of just 1-2 days, that too only if refrigerated. In 1996, Tetra Packs were introduced in India. Tetra Packs are aseptic laminate packs made of aluminum, paper, board and plastic. Milk stored in tetra packs and treated under Ultra High Temperature (UHT) technique can be stored for four months without refrigeration. Most of the dairy cooperatives in Andhra Pradesh, Tamil Nadu, Punjab and Rajasthan sell milk in tetra packs. However tetra packed milk is costlier by Rs5-7 compared to plastic pouches. In 1999-00 Nestle launched its UHT milk. Amul too re-launched its Amul Taaza brand of UHT milk. The UHT milk market is expected to grow at a rate of more than 10-12% in coming years.

Export Potential
India has the potential to become one of the leading players in milk and milk product exports. Location advantage: India is located amidst major milk deficit countries in Asia and Africa. Major importers of milk and milk products are Bangladesh, China, Hong

Kong, Singapore, Thailand, Malaysia, Philippines, Japan, UAE, Oman and other gulf countries, all located close to India. Low Cost of Production: Milk production is scale insensitive and labour intensive. Due to low labour cost, cost of production of milk is significantly lower in India. Concerns in export competitiveness are Quality: Significant investment has to be made in milk procurement, equipments, chilling and refrigeration facilities. Also, training has to be imparted to improve the quality to bring it up to international standards. Productivity: To have an exportable surplus in the long-term and also to maintain cost competitiveness, it is imperative to improve productivity of Indian cattle. There is a vast market for the export of traditional milk products such as ghee, paneer, rasgullas and other ethnic sweets to the large number of Indians scattered all over the world.

India's exports of milk products

1995-96 Quantity Skimmed 4,638.62 milk powder 3,35.32 282.70 19.64 5.00 0.375 Value 1996-97 Quantity Value 1997-98 Quantity Value

Milk and Milk Food for babies 8.27 2.019 111.37 4.27 11.00 2.02

Milk cream

332.23

28.04

1.00

0.084

Sweetened condensed milk Whey Ghee/Butter/ 7,895.08 Butter oil Cheese (a) Fresh (b) 5.67 Processed (c) Other TOTA 66.64 8.35 8,72.7 36.78 0.69 52.4 24.84 4.55 2,55.6 1.20 2.1 0.375 22.10 2.19 0.10 0.013 431.1 299.97 19.2 4,352.08 2,38.95 78.46 3.75 11.50 1.01 6.00 0.342 41.73 2.84 9.22 0.97 60.39 7.22

What does the Indian Dairy Industry has to Offer to Foreign Investors?

India is a land of opportunity for investors looking for new and expanding markets. Dairy food processing holds immense potential for high returns. Growth prospects in the dairy food sector are termed healthy, according to various studies on the subject. The basic infrastructural elements for a successful enterprise are in place. Key elements of free market system Raw material (milk) availability An established infrastructure of technology supporting manpower An entrepreneur's participation is likely to provide attractive returns on the investment in a fast growing market such as India, along with an export potential in the Middle East, Singapore, Malaysia, Indonesia, Korea, Thailand, Hong Kong and other countries in the region. Among several areas of potential participation by NRIs and foreign investors, the following list outlines a few promising opportunities:

Biotechnology:
Dairy cattle breeding of the finest buffaloes and hybrid cows Milk yield increase with recombinant somatotropin Recombinant chymosin, acceptable to vegetarian consumers Dairy cultures, probiotics, dairy biologics, enzymes and coloring materials for food processing

Fermentation derived foods and industrial products alcohol, citric acid, lysine, flavor preparations, etc. Biopreservative ingredients based on dairy fermentation, viz., Nisin, pediococcin, acidophilin and bulgarican contained in dairy powders.

Dairy/food processing equipment:

Potential exists for manufacturing and marketing of cost competitive food processing machinery of world-class quality.

Food packaging equipment:

Opportunities lie in the manufacturing of both machinery and packaging materials that help develop brand loyalty and a clear edge in the marketing of dairy foods.

Distribution channels:
For refrigerated and frozen food distribution, a world class cold chain would help in providing quality assurance to the consumers around the region.

Retailing:
There is scope for standardizing and upgrading food retailing in major metropolitan cities to meet the shopping needs of a vast middle class. This area includes grocery stores of European and North American quality, warehousing and distribution.

Product development:
Dairy foods can be manufactured and packaged for export to countries where Indian food enjoys basic acceptance. The manufacturing may be carried out in contract plants in India. An option to market the products in collaboration with local establishments or entrepreneurs can also be explored. Products exhibiting potential include typical indigenous dairy foods either not available in foreign countries or products whose authenticity may be questionable. Gulabjamuns, Burfi, Peda, Rasagollas, and a host of other Indian sweets have good business prospects. Products typically foreign to India but indigenous to other countries could also be developed for export. Such products can be manufactured in retail package sizes and could be produced from milk of sheep, goats and camel. Certain products are characteristically produced from milk of a particular species. For example, Feta cheese is used in significant tonnage, in Iran. Sheep milk is traditionally used for authentic Feta cheese. Accordingly, India's goat and sheep herds can be utilized for the manufacture of such authentic products.

Ingredient manufacture:
Export markets for commodities like dry milk, condensed milk, ghee and certain cheese varieties are well established. These items are utilized as ingredients in foreign countries. These markets can be expanded to include value-added ingredients like aseptically packaged cheese sauce and dehydrated cheese powders.

Cheese sauce: Canned cheese sauce is made from real cheese to which milk, whey, modified food starch, vegetable oil, colorings and spices may be added. Cheese sauce is useful in kitchens for the preparation of omelet, sandwiches, entrees, and soups. In addition, cheese sauce is used as a topping on potatoes and vegetables and may be incorporated in pasta dishes. Cheese powders: Cheese powders are formulated for dusting or smearing of popular snacks like potato chips, crackers, etc. They impart flavor and may be blended with spices. With the globalization of food items, an opportunity should open up for food service and institutional markets.

Technology-driven manufacturing units:

These plants would fulfill an essential need by providing a centralized and specialized facility for hire by the units which cannot justify capital investment but do need such services. Potential areas for state-of-the-art contract-pack units may conceivably specialize in cheese slicing, or dicing line, cheese packaging, butter printing, and aseptic packaged fluid products.

Training centers for continuing education:

NRIs could set up technology transfer and updating centers for conducting seminars and workshops - catering to the needs of workers at all levels of the dairy industry. Here technical, marketing and management topics can be offered to ensure that the manpower continues to acquire the latest know-how of their respective fields.

The entrepreneurs need powerful tools to implement their plans. Appropriate investment and involvement by NRIs can serve as a catalyst for India's dairy food industry leading to exploration of business potential in domestic and export trade. Risk factors must be identified and managed by in-depth study of chosen areas so that chances of rewards are maximized under the current liberalization climate.

Indian (traditional) Milk Products

There are a large variety of traditional Indian milk products such as Makhan - unsalted butter. Ghee - butter oil prepared by heat clarification, for longer shelf life. Kheer - a sweet mix of boiled milk, sugar and rice. Basundi - milk and sugar boiled down till it thickens. Rabri - sweetened cream. Dahi - a type of curd. Lassi - curd mixed with Water and sugar/ salt. Channa/Paneer - milk mixed with lactic acid to coagulate. Khoa - evaporated milk, used as a base to produce sweet meats. The market for indigenous based milk food products is difficult to estimate as most of these products are manufactured at home or in small cottage industries catering to local areas. Consumers while purchasing dairy products look for freshness, quality, taste and texture, variety and convenience. Products like Dahi and sweets like Kheer, Basundi, and Rabri are perishable products with a shelf life of less than a day. These products are therefore manufactured and sold by local milk and sweet shops. There are several such small shops

within the vicinity of residential areas. Consumer loyalty is built by consistent quality, taste and freshness. There are several sweetmeat shops, which have built a strong brand franchise, and have several branches located in various parts of a city.

Branding Of Traditional Milk Products

Among the traditional milk products, ghee is the only product, which is currently marketed, in branded form. main ghee brands are Sagar, MilkMan (Britannia), Amul (GCMMF), Aarey (Mafco Ltd), Vijaya (AP Dairy Development Cooperative Federation), Verka ( Punjab Dairy Cooperative), Everyday (Nestle) and Farm Fresh (Wockhardt). With increasing urbanization and changing consumer preferences, there is possibility of large scale manufacture of indigenous milk products also. The equipments in milk manufacturing have versatility and can be adapted for several products. For instance, equipments used to manufacture yogurt also can be adapted for large scale production of Indian curd products (dahi and lassi). Significant research work has been done on dairy equipments under the aegis of NDDB. Mafco Limited sells Lassi under the Aarey brand and flavored milk under the Energee franchise (in the Western region, mainly in Mumbai). Britannia has launched flavored milk in various flavors in tetra packs. GCMMF has also made a beginning in branding of other traditional milk products with the launch of packaged Paneer under the Amul brand. It has also created a new umbrella brand "Amul Mithaee", for a range of ethnic Indian sweets that are proposed to be launched the first new product Amul Mithaee Gulabjamun has already been launched in major Indian markets.

Western Milk Products Western milk products such as butter, cheese, and yogurt have gained popularity in the Indian market only during the last few years. However consumption has been expanding with increasing urbanization.

Butter
Most Indians prefer to use homemade white butter (makhan) for reasons of taste and affordability. Most of the branded butter is sold in the towns and cities. The major brands are Amul, Vijaya, Sagar, Nandini and Aarey. Amul is the leading national brand while the other players have greater shares in their local markets. The latest entrant in the butter market has been Britannia. Britannia has the advantages of a wide distribution reach and a strong brand recall. Priced at par with the Amul brand, it is expected to give stiff competition to the existing players. In 1999-00 the butter production is estimated at 4 lakhs MT of this only 45K MT is in the white form used for table purposes rest all is in the yellow form.

Cheese
The present market for cheese in India is estimated at about 9,000 tonnes and is growing at the rate of about 15% per annum. Cheese is mainly consumed in the urban areas. The four metro cities alone account for more than 50% of consumption. Mumbai is the largest market (accounting for 30% of cheese sold in the country), followed by Delhi (20%). Calcutta (7%) and Chennai (6%). Mumbai has a larger number of domestic consumers, compared to Delhi where the bulk institutional segment (mainly hotels) is larger.

Demand for various types of cheese in the Indian market

Type of cheese Processed Cheese spread Mozzarella Flavored/Spiced Others

% of total consumption 50 30 10 5 5

The major players are Amul, Britannia, and Dabon International dominating the market. Other major brands were Vijaya, Verka and Nandini (all brands of various regional dairy cooperatives) and Vadilal. The heavy advertising and promotions being undertaken by these new entrants is expected to lead to strong 20% growth in the segment. Amul has also become more aggressive with launch of new variants such as Mozzarella cheese (used in Pizza), cheese powder, etc. The entry of new players and increased marketing activity is expected to expand the market. All the major players are expanding their capacities

Capacity expansion in Cheese

Company Dynamix Group

Brands Manufactures for Britannia

State Maharashtra

Capacity 35 tons per day

GCMMF

Amul

Gujarat

20 tons per day

APDDCF

Vijaya

Andhra Pradesh

10 tons per day

Milk Powder
Milk powder is mainly of 2 types Whole milk powder Skimmed milk powder Whole milk powder contains fat, as distinguished from skimmed milk powder, which is produced by removing fat from milk solids. Skimmed milk powder is preferred by diet conscious consumers. Dairy whiteners contain more fat than skimmed milk powder but less compared to whole milk powder. Dairy whiteners are popular milk substitute for making tea, coffee etc. The penetration of these products in milk abundant regions is driven by convenience and non perishable nature (longer shelf life) of the product.

Dairy sector of advanced nations export milk products with a subsidy of $ 1000 per ton with a level of subsidy more than 60 % of the price of milk powder produced in India, this has led to large scale imports of milk powder both in whole and skimmed form. To protect the domestic sector from these subsidized imports the central government has recently increased the basic import duty on all imports of milk powder more than 10000 MT to 60% from 15%. For imports less than 10000 MT the basic customs duty has been left unchanged at 15%. In 1999-00 India is estimated to have imported about 18,000 tonnes of milk powder against a total estimated production of 2.40 Lakhs MTs. In 2000-01 India is expected to export 10000 MT of skimmed milk powder due to rise in international prices to $2300 per MT from last year's levels of $1400 per MT. These expectations are based on the strong demand from Russia, East Asia and Latin America, and also on tightening of supply in EU, which accounts for 75% of the annual global Skimmed Milk Powder exports.

Major Players
Milk Powder/Dairy Whiteners: Major skimmed milk brands are Sagar (GCMMF) and Nandini (Karnataka Milk Federation), Amul Full Cream milk powder is a whole milk powder brand. Leading brands in the dairy whitener segment are Nestls Everyday, GCMMF's Amulya, Dalmia Industry's Sapan, Kwality Dairy India's KreamKountry, Wockhardt's Farm Fresh and Britannia's MilkMan Dairy Whitener.

Condensed Milk
The condensed milk market has grown from 9000 MT in 1998 to 11000 MT in 1999. Condensed milk is a popular ingredient used in home-made sweets and cakes. Nestls Milkmaid is the leading brand with more than 55% market share. The only other competitor is GCMMF's Amul.

Value addition in milk powder - Infant Foods

Nestle is the market leader in the segment. This is a category where brand loyalties are very strong as mothers want the best for their babies. Heinz is the only other significant competitor to Nestle in this segment. Nestls Cerelac and Nestum together have around 80% market share and Heinz's Farex has close to 18% share. Wockhardt is a relatively new entrant with its First Food brand. Wockhardt also proposes to launch a new baby food Easum containing moong (moong is one of the easily digestible pulses). The Easum brand will directly compete with Nestls Nestum (made from rice). In infant formula also Nestls Lactogen formula and Lactogen standard formula are the leading brands with around 75% market share. Other brands are Heinz's Lactodex Farex, Wockhardt's Raptakos, and Amul's Amulspray

Regulatory Framework
The dairy industry was de-licensed in 1991 with a view to encourage private investment and flow of capital and new technology in the segment. Although de-licensing attracted a large number of players, concerns on issues like excess capacity, sale of contaminated/

substandard quality of milk etc induced the Government to promulgate the MMPO (Milk and Milk Products Order) in 1992. Milk and Milk Products Order (MMPO) regulates milk and milk products production in the country. The order requires no permission for units handling less than 10,000 liters of liquid milk per day or milk solids up to 500 TPA. MMPO prescribes State registration to plants producing between 10,000 to 75,000 liters of milk per day or manufacturing milk products containing between 500 to 3,750 tonnes of milk solids per year. Plants producing over 75,000 liters per day or more than 3,750 tonnes per year of milk solids have to be registered with the Central Government. The stringent regulations, government controls and licensing requirements for new capacities have restricted large Indian and MNC players from making significant investments in this product category. Most of the private sector players have restricted themselves to manufacture of value added milk products like baby food, dairy whiteners, condensed milk etc. All the milk products except malted foods are covered in the category of industries for which foreign equity participation up to 51% is automatically allowed. Ice cream, which was earlier reserved for manufacturing in the small-scale sector, has now been dereserved. As such, no license is required for setting up of large-scale production facilities for manufacture of ice cream. Subsequent to de-canalization, exports of some milk based products are freely allowed provided these units comply with the compulsory inspection requirements of concerned agencies like: National Dairy Development Board, Export Inspection Council etc. Bureau of Indian standards has prescribed the necessary standards for almost all milk-based products, which are to be adhered to by the industry.

Proposal to Amend the MMPO

A proposal to raise the exemption limit for compulsory registration of dairy plants, from the present 10,000 liters a day to 20,000 liters, is being considered by the Animal Husbandry Department. The 75,000-liter limit is likely to be raised either to 100,000 liters or 125,000 liters in the amended order. The new order would also do away with the provision for re-registration.

Amul's secret of success

The system succeeded mainly because it provides an assured market at remunerative prices for producers' milk besides acting as a channel to market the production enhancement package. What's more, it does not disturb the agro-system of the farmers. It also enables the consumer an access to high quality milk and milk products. 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. Looking back on the path traversed by Amul, the following features make it a pattern and model for emulation elsewhere. Amul has been able to: Produce an appropriate blend of the policy makers farmers board of management and the professionals: each group appreciating its roles and limitations bring at the command of the rural milk producers the best of the technology and harness its fruit for betterment Provide a support system to the milk producers without disturbing their agroeconomic systems

Plough back the profits, by prudent use of men, material and machines, in the rural sector for the common good and betterment of the member producers and Even though, growing with time and on scale, it has remained with the smallest producer members. In that sense, Amul is an example par excellence, of an intervention for rural change.

The Union looks after policy formulation, processing and marketing of milk, provision of technical inputs to enhance milk yield of animals, the artificial insemination service, veterinary care, better feeds and the like - all through the village societies. The village society also facilitates the implementation of various production enhancement and member education programs undertaken by the Union. The staff of the village societies has been trained to undertake the veterinary first-aid and the artificial insemination activities on their own.

Amul's success: A model for other districts to follow.

Amul's success led to the creation of similar structures of milk producers in other districts of Gujarat. They drew on Amul's experience in project planning and execution. Thus the 'Anand Pattern' was followed not just in Kaira district but in Mehsana, Sabarkantha, Banaskantha, Baroda and Surat districts also. Even before the Dairy Board of India was born, farmers and their leaders carried out empirical tests of the hypotheses that explained Amul's success. In these districts, milk producers and their leaders experienced significant commonalties and found easy and effortless ways to adapt Amul's game plan

to their respective areas. This led to the Creation of the National Dairy Development Board with the clear mandate of replicating the 'Anand pattern' in other parts of the country. Initially the pattern was followed for the dairy sector but at later stage oilseeds, fruit and vegetables, salt, and tree sectors also benefited from its success.

GCMMF: An Overview
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.

Members:

12 district cooperative milk producers' Union

No. of Producer Members: No. of Village Societies: Total Milk handling capacity: Milk collection (Total - 1999-00): Milk collection (Daily Average 1999-00):

2.12 million 10,411 6.1 million liters per day 1.59 billion liters 4.47 million liters

Milk Drying Capacity:

450 metric Tons per day

Cattle feed manufacturing Capacity: 1450 MTs. per day Sales Turnover Rs (million) US $ (in millions)

1994-95 1995-96 1996-97 1997-98 1998-99 1999-00

11140 13790 15540 18840 22192 22185

355 400 450 455 493 493

Major dairy products manufacturers Some of the major dairy products manufacturers in the country:

Company Nestle India Limited

Brands

Major Products

Milkmaid, Cerelac, Lactogen, Sweetened condensed milk, malted Milo, Everyday foods, milk powder and Dairy whitener

Milk food Limited SmithKline Beecham Limited Indodan Industries Limited Gujarat Cooperative milk Marketing Federation Limited H.J. Heinz Limited Britannia

Milk food

Ghee, ice cream, and other milk products

Horlicks, Maltova, Viva

Malted Milk food, ghee, butter, powdered milk, milk fluid and other milk based baby foods.

Indana

Condensed milk, skimmed milk powder, whole milk powder, dairy milk whitener, chilled and processed milk

Amul

Butter, cheese and other milk products

Farex, Complan, Glactose, Bonniemix, Vitamilk Milkman

Infant Milk food, malted Milk food

Flavored milk, cheese, Milk Powder, Ghee

Cadbury

Bourn vita

Malted food

Future Prospects
India is the world's highest milk producer and all set to become the world's largest food

factory. In celebration, Indian Dairy sector is now ready to invite NRIs and Foreign investors to find this country a place for the mammoth investment projects. Be it investors, researchers, entrepreneurs, or the merely curious Indian Dairy sector has something for everyone. Milk production is relatively efficient way of converting vegetable material into animal food. Dairy cows buffalos goats and sheep can eat fodder and crop by products which are not eaten by humans. Yet the loss of nutrients energy and equipment required in milk handling inevitably make milk comparatively expensive food. Also if dairying is to play its part in rural development policies, the price to milk producers has to be remunerative. In a situation of increased international prices, low availabilities of food aid and foreign exchange constraints, large scale subsidization of milk conception will be difficult in the majority of developing countries. Hence in the foreseeable future, in most of developing countries milk and milk products will not play the same roll in nutrition as in the affluent societies of developed countries. Effective demand will come mainly from middle and high income consumers in urban areas. There are ways to mitigate the effects of unequal distribution of incomes. In Cuba where the Government attaches high priority to milk in its food and nutrition policy, all preschool children receive a daily ration of almost a liter of milk fat the reduced price. Cheap milk and milk products are made available to certain other vulnerable groups, by milk products outside the rationing system are sold price which is well above the cost level. Until recently, most fresh milk in the big cities of China was a reserved for infants and hospitals, but with the increase in supply, rationing has been relaxed.

In other countries dairy industries have attempted to reach lower income consumers by variation of compositional quality or packaging and distribution methods or blending milk in vegetable ingredients in formula foods for vulnerable groups. For instance, pricing of products rich in butter fat or in more luxury packaging above cost level so as to enable sales of high protein milk products at a somewhat a reduced price has been widely practiced in developing countries. This policies need to be brought in Indian Dairy scenario.

CHAPTER 3

STUDENTS WORK PROFILE

Name: SYED ADAM VALI

Worked at: A.P.DAIRY (VIJAYA)

A.P.Diary (Vijaya) is a local organization which has a very large content and vast reach of technology. Vijaya dairy and farm products (p) ltd. Started in1995 as a committed vision to procure surplus cow milk from the farmers and to pay reasonable price for the procured milk to produce milk and milk products through superior technology and process.

Post at the company (A.P.Diary, Vijaya): (marketing executive)

Working period: 1st march, 2011 31stmarch, 2011

Work handled: The various jobs performed at A.P.Diary (Vijaya) are

1. Went to different places and consulted many business people 2. Explained them the various services offered by our company 3. Collected information about their business or outlet 4. Collected feedback 5. Submission of sales report 6. Get deals for the company

Key learnings:

Due to the training the various things we learned were: 1. To understand customer behaviors, how to collect feedback, deal with customer responses, objections of customers 2. How to determine target customers and conduct market research study 3. Opening of sales

4. Development of interest for our service in customers. 5. Promotion of our services 6. Sales of services, and understood the trends in marketing. 7. Closing of sales

CHAPTER 4 STUDY OF SELECTED RESEARCH PROBLEM

(IMPACT OF ADVERTERISEMENT)

IMPACT OF ADVERTISING

Advertising is a form of communication used to persuade an audience (viewers, readers or listeners) to take some action with respect to products, ideas, or services. Most commonly, the desired result is to drive consumer behaviour with respect to a commercial offering, although political and ideological advertising is also common. Advertising messages are usually paid for by sponsors and viewed via various traditional media; including mass media such as newspaper, magazines, television commercial, radio advertisement, outdoor advertising or direct mail; or new media such as websites and text messages.

Commercial advertisers often seek to generate increased consumption of their products or services through "Branding," which involves the repetition of an image or product name in an effort to associate certain qualities with the brand in the minds of consumers. Noncommercial advertisers who spend money to advertise items other than a consumer product or service include political parties, interest groups, religious organizations and governmental agencies. Non-profit organizations may rely on free modes of persuasion, such as a public service announcement Types of advertising

Paying people to hold signs is one of the oldest forms of advertising, as with this Human billboard pictured above

A bus with an advertisement for GAP in Singapore. Buses and other vehicles are popular mediums for advertisers.

A DBAG Class 101 with UNICEF ads at Ingolstadt main railway station Virtually any medium can be used for advertising. Commercial advertising media can include wall paintings, billboards, street furniture components, printed flyers and rack cards, radio, cinema and television adverts, web banners, mobile telephone screens, shopping carts, web popups, skywriting, bus stop benches, human billboards, magazines,

newspapers, town criers, sides of buses, banners attached to or sides of airplanes "logojets", in-flight advertisements on seatback tray tables or overhead storage bins, taxicab doors, roof mounts and passenger screens, musical stage shows, subway platforms and trains, elastic bands on disposable diapers, doors of bathroom stalls, stickers on apples in supermarkets, shopping cart handles (grabertising), the opening section of streaming audio and video, posters, and the backs of event tickets and supermarket receipts. Any place an "identified" sponsor pays to deliver their message through a medium is advertising.

Digital advertising
Television advertising / Music in advertising The TV commercial is generally considered the most effective mass-market advertising format, as is reflected by the high prices TV networks charge for commercial airtime during popular TV events. Paying people to hold signs is one of the oldest forms of advertising. A bus with an advertisement for GAP in Singapore. Buses and other vehicles are popular mediums for advertisers. A DBAG Class 101 with UNICEF ads at Ingolstadt main railway station. Virtually any medium can be used for advertising. Commercial advertising media can include wall paintings, billboards, street furniture components, printed flyers and rack cards, radio, cinema and television adverts, web banners, mobile telephone screens, shopping carts, web popups, skywriting, bus stop benches, human billboards, magazines, newspapers, town criers, sides of buses, banners attached to or sides of airplanes ("logojets"), in-flight advertisements on seatback tray tables or overhead storage bins,

taxicab doors, roof mounts and passenger screens, musical stage shows, subway platforms and trains, elastic bands on disposable diapers, doors of bathroom stalls, stickers on apples in supermarkets, shopping cart handles (grabertising), the opening section of streaming audio and video, posters, and the backs of event tickets and supermarket receipts. Any place an "identified" sponsor pays to deliver their message through a medium is advertising.

Digital advertising
Television advertising / Music in advertising The TV commercial is generally considered the most effective mass-market advertising format, as is reflected by the high prices TV networks charge for commercial airtime during popular TV events. The annual Super Bowl football game in the United States is known as the most prominent advertising event on television. The average cost of a single thirty-second TV spot during this game has reached US$3 million (as of 2009). The majorities of television commercials feature a song or jingle that listeners soon relate to the product. Virtual advertisements may be inserted into regular television programming through computer graphics. It is typically inserted into otherwise blank backdrops or used to replace local billboards that are not relevant to the remote broadcast audience. More controversially, virtual billboards may be inserted into the background where none exist in real-life. This technique is especially used in televised sporting events. Virtual product placement is also possible. Infomercials: An infomercial is a longformat television commercial, typically five minutes or longer. The word "infomercial"

combining the words "information" & "commercial". The main objective in an infomercial is to create an impulse purchase, so that the consumer sees the presentation and then immediately buys the product through the advertised toll-free telephone number or website. Infomercials describe, display, and often demonstrate products and their features, and commonly have testimonials from consumers and industry professionals.

Radio advertising
Radio advertising is a form of advertising via the medium of radio. Radio advertisements are broadcast as radio waves to the air from a transmitter to an antenna and a thus to a receiving device. Airtime is purchased from a station or network in exchange for airing the commercials. While radio has the limitation of being restricted to sound, proponents of radio advertising often cite this as an advantage. Radio is an expanding medium that can be found not only on air, but also online. According to Arbitron, radio has approximately 241.6 million weekly listeners, or more than 93 percent of the U.S. population.

Online advertising
Online advertising is a form of promotion that uses the Internet and World Wide Web for the expressed purpose of delivering marketing messages to attract customers. Examples of online advertising include contextual ads that appear on search engine results pages, banner ads, in text ads, Rich Media Ads, Social network advertising, online classified advertising, advertising networks and e-mail marketing, including e-mail spam.

Physical advertising
Press advertising Press advertising describes advertising in a printed medium such as a newspaper, magazine, or trade journal. This encompasses everything from media with a very broad readership base, such as a major national newspaper or magazine, to more narrowly targeted media such as local newspapers and trade journals on very specialized topics. A form of press advertising is classified advertising, which allows private individuals or companies to purchase a small, narrowly targeted ad for a low fee advertising a product or service. Another form of press advertising is the Display Ad, which is a larger ad (can include art) that typically run in an article section of a newspaper. Billboard advertising: Billboards are large structures located in public places which display advertisements to passing pedestrians and motorists. Most often, they are located on main roads with a large amount of passing motor and pedestrian traffic; however, they can be placed in any location with large amounts of viewers, such as on mass transit vehicles and in stations, in shopping malls or office buildings, and in stadiums.

The Redeye newspaper advertised to its target market at North Avenue Beach with a sailboat billboard on Lake Michigan.

Mobile billboard advertising

Mobile billboards are generally vehicle mounted billboards or digital screens. These can be on dedicated vehicles built solely for carrying advertisements along routes preselected by clients, they can also be specially equipped cargo trucks or, in some cases, large

banners strewn from planes. The billboards are often lighted; some being backlit, and others employing spotlights. Some billboard displays are static, while others change; for example, continuously or periodically rotating among a set of advertisements. Mobile displays are used for various situations in metropolitan areas throughout the world, including: Target advertising, one-day, and long-term campaigns, Conventions, Sporting events, Store openings and similar promotional events, and big advertisements from smaller companies.

In-store advertising
In-store advertising is any advertisement placed in a retail store. It includes placement of a product in visible locations in a store, such as at eye level, at the ends of aisles and near checkout counters, eye-catching displays promoting a specific product, and advertisements in such places as shopping carts and in-store video displays.

Coffee cup advertising

Coffee cup advertising is any advertisement placed upon a coffee cup that is distributed out of an office, caf, or drive-through coffee shop. This form of advertising was first popularized in Australia, and has begun growing in popularity in the United States, India, and parts of the Middle East.

Street advertising
This type of advertising first came to prominence in the UK by Street Advertising Services to create outdoor advertising on street furniture and pavements. Working with

products such as Reverse Graffiti and 3d pavement advertising, the media became an affordable and effective tool for getting brand messages out into public spaces.

Celebrity branding
This type of advertising focuses upon using celebrity power, fame, money, popularity to gain recognition for their products and promote specific stores or products. Advertisers often advertise their products, for example, when celebrities share their favorite products or wear clothes by specific brands or designers. Celebrities are often involved in advertising campaigns such as television or print adverts to advertise specific or general products. The use of celebrities to endorse a brand can have its downsides, however. One mistake by a celebrity can be detrimental to the public relations of a brand. For example, following his performance of eight gold medals at the 2008 Olympic Games in Beijing, China, swimmer Michael Phelps' contract with Kellogg's was terminated, as Kellogg's did not want to associate with him after he was photographed smoking marijuana

ADVERTISING
In recent times, the word 'Advertising' has become a fiercely mooted topic. Advertising has positive as well as negative, social and economic impacts on our society. Considering advertising as a public welfare is a positive social impact whereas exposing women as a sex tool comes at the negative side. As far as economic factors are concerned, funding for the media and stimulating an active and competitive economy, are the major examples. Assorted techniques are enforced for persuading consumers that they want the product which is being advertised. These techniques usually give attention to the benefits that

would be brought to the consumers rather than focusing on the actual products. For instance, an automobile advertisement adverting the mechanical attributes of a vehicle, most likely concentrates the exhilaration, reputation and social progression it may bring to the buyer. This swarming advancement is habitually sexual, or involving the opposite gender to attract the consumers with the glamorous women/men's fancy car. There are various blames that advertising is causing a negative social impact on the lives. The chief unfavorable judgment for advertising is that it hales the public to buy things that they are not their real want. It is arrogated that advertising plays with emotions and encourages people to think that buying and depleting are the activities of life. According to advertisers, they state that people are capable enough to set their mind and no one can force them to buy anything which they dislike or which they think is not a necessity. Advertisers also think that there are positive impacts of advertising on our society and culture. For example, it can be used to generate awareness among the public that which product is OK or to which they should say NO. In other words, advertising also acts as an educator in the sense that it educates people what is good and what is bad for them and puts a ceiling on the harmful products like smoking and drinking etc. There are not only social benefits of advertising, but it also has some economic advantages. Without advertising, the media, including newspapers, television and radio would never be much strong. Advertising provides revenue for commercial mediums which would otherwise need to be funded by the actual consumer of these mediums. So, we can see a major economic infrastructure based around advertising, in which the big companies fund and subsidize the commercial media by the way of advertisements. The major economic negative aspect of advertising is that it boosts the price of goods and

services. The source of this contention is that, when organizations subsidize the mass media with advertising, we, the purchaser, subsidize advertising by compensating a grossly increased price for heavily advertised goods and services. An easy example of this is that a box of Omo washing powder generally costs around two to three dollars while the market price of the product would be seven to eight dollars. The fact behind this is that the remaining proportion goes in heavy advertising in television and print media. So, the impact of advertising on our society is in a jumble form, depending on the functions and implementations of numerous campaigns. Our society and the marketing of products depend very badly upon advertising. The companies have become much dependent of advertising that even its negative impacts can never outweigh the many positive social and economic effects.

Positive impact of advertising David droga

Many of us involved in advertising sometimes find ourselves defending our industry and work. While there are certainly varied examples of how creative, thought-provoking and even motivational and informative advertising can be when done right, there will always be some of how deceptive, ineffective and laughable it can be when steered wrong. That said David Droga has more often than not created examples of positive advertising that has impact. In a recent interview and discussion with CNN Icon, Droga discussed his views on the evolution of advertising. To this end, Droga described advertising as living at the intersection of art and commerce, cited examples of socially responsible advertising and

brand communications, and asserted that advertising (and brand work) that is in sync with what consumers want can indeed be impactful beyond just selling product or improving brand perception but also contributing to social good. We pulled some key points from Drogas interview; Perhaps one of the greatest and biggest changes in the advertising industry has been the way brands sell themselves and the mediums in which they do that. Its as much about the communication, but also now it is the body language of a brandhow it actually operates and exists in the real world Example of a brand that understands its own body language, or role in culture, is Puma, whom took the proactive measure to diminish its environmental impact with the Clever Little Bag - a reinvented, less wasteful shoe box Advertising is about more than just bombarding consumers with buy messages it can contribute to and lead culture, even help solve social issues Advertising now takes on a far greater role of social responsibility and contributing to society. It seems like not a lot of the worlds issues can be solved by big government. But they can be solved by brands, and brands putting their best food forward need advertising Example of a brand that responsibly educated its audience of the myth of beauty in the fashion and beauty is industry is of course Doves Evolution within the Campaign for Real Beauty Examples of the socially-conscious brands or projects that Droga5 works with include Method, Puma, and UNICEFs Tap Project Advertising can instigate brand stories; brands can become curators by initiating a brand

story with engaging content, they may offer content to consumers, and allow them to take a hold of it, build from it and add to it Drogas ultimate challenge for what an ad campaign can and should do? Convince, inspire and motivate. And as these examples suggest, good advertising can inspire and motivate socially-beneficial behaviors particularly when the brand initiating that communication has first identified what role it can most naturally play (its body language) to take action towards contributing to the cause themselves. The end action desired of advertising begins with responsibility for the brands own role.

METHODOLOGY OF STUDY

Primary Data: Primary data is the data which is collected by the researcher directly from their own observations and experiences. Primary data are those data which are collected for the first time, taking a sample, representing a population. It is not a published data.

Secondary Data:

Secondary data are those data, which are already published. It may be useful for many other people than the researcher who has published it. There are various sources of secondary data collection. Government sources, which includes development of census reports, central government records and state and local government SR records.

Resources like business magazines, internet were utilized for gathering secondary information. The study was based on data collected from secondary sources. These data were obtained from annual reports as well as from the website.

CHAPTER 5 ANALYSIS (ANALYSIS OF DATA, SUMMARY OF FINDINGS)

The following is the analysis of the data collected by me from the questionnaires with graphical representation. What type of package drinking Water do you consume? Table No: 1 S.NO 1 2 3 4 5 CHART NO: 1 RESPONSES Bisleri Kinley Aquafina Bibo Qua RESPONDENT 35 20 10 30 5

40 35 30 25 20 15 10 5 0 BISLERI KINLEY AQUAFINA BIBO QUA

INTERPRETATION: According to the above graph we can say that majority of the people use bisleris package drinking Water.

Do you use any vijaya products?

TABLE NO: 2

S.NO 1 2

RESPONSES YES NO

RESPONDENT 40 60

CHART NO: 2

70 60 50 40

30
20 10 0 YES NO

INTERPRETATION: It can be understood that on the whole fewer people consume Vijays products.

If yes, which product?

TABLE NO: 3

S:NO 1 2 3 4

RESPONSES PASTUERIZED MILK BUTTER CURD GHEE

RESPONDENT 33 20 10 37

CHART NO: 3

40 35 30 25 20 15 10 5 0 PASTUERIZED MILK BUTTER CURD GHEE

INTERPRETATION: From the above graph it can be inferred the consumption of dairy products is more that its package drinking water.

What is your opinion about Vijaya Products advertising techniques?

TABLE NO: 4

S.NO 1 2 3 4

RESPONSES BAD AVERAGE GOOD EXCELLENT

RESPONDENT 15 25 60 30

CHART NO: 4

70 60 50 40 30 20 10 0 BAD AVERAGE GOOD EXCELLENT

INTERPRETATION: Most of the people find the advertising techniques of vijaya products to be good.

Is Vijaya Package drinking water advertising informative?

TABLE NO: 5

S.NO 1 2

RESPONSES YES NO

RESPONDENT 45 55

CHART NO: 5

60 50 40 30 20 10 0 YES NO

INTERPRETATION: From the above graph it can be said that most people dont find Vijaya package drinking water advertisements informative.

Where did you come across our advertisement?

TABLE NO: 6

S.NO 1 2 3 4 5 CHART NO: 6

RESPONSES NEWSPAPERS TELEVISION RADIO MAGAZINES HOARDING & PAMPHETS

RESPONDENT 40 55 15 30 45

60
50 40 30 20 10 0

INTERPRETATION: Majority of the people came to know about Vijaya products through television.

Did our advertising techniques urge you to buy our product?

TABLE NO:7

S. NO 1 2

RESPONSES YES NO

RESPONDENT 60 40

CHART NO:7
70 60 50 40 30 20 10 0 YES NO

INTERPRETATION: Majority of the people felt the urge to buy our product after watching the advertisements.

Do you think our products are affordable?

TABLE NO: 8

SR:NO 1 2

RESPONSES YES NO

RESPONDENT 32 18

CHART NO: 8

35 30 25 20 15

10
5 0 YES NO

INTERPRETATION: Most of Vijaya products are affordable.

Where do you rank Vijays package drinking water?

TABLE NO: 9

S.NO 1 2 3 4

RESPONSES EXCELLENT BAD GOOD AVERAGE

RESPONDENT 15 30 25 35

CHART NO: 9

40 35 30 25 20 15 10 5 0 EXCELLENT BAD GOOD AVERAGE

INTERPRETATION: Majority of the people rank vijaya at AVERAGE.

CHAPTER 6 SUMMARY AND CONCLUSIONS (Summary of learning Experience Conclusion and Recommendations)

SUMMARY OF LEARNING EXPERIENCE

Due to the training the various things we learnt were: To understand customer behaviors, how to collect feedback, deal with customer responses, objections of customers. How to determine target customers and conduct market research study Opening of sales Development of interest for Vijaya products service in customers. Promoted Vijaya dairy sales Sale of services, and understood the trends in advertising Closing of sales By conducting this research I learnt about the various trends in promotion of sales in marketing with reference to A.P.Diary (Vijaya).

CONCLUSION AND RECOMMENDATIONS

Following is the conclusion from the data collected questionnaire on Impact of Advertising: People find Vijayas advertising technique to be good but not much informative. People mostly prefer quality products in market. Many people have not heard about Vijaya Water. People think Vijaya Water is good in taste. People think that changes should be made in quality. People think that Vijaya Water has an affordable price than other products. Mostly people are interested in choosing branded products. Most companies do not follow BIS standards unlike Vijaya Waters. There are so many local brands which are selling their products at fewer prices. People think that advertising through demo tents is much better than using any other techniques

The various recommendations I would like to give to the A.P.Diary (Vijaya) are: We did some promotional programs such that most of the people come to know what is Vijaya in city. To make the product more friendly and attractive in appearance. Engaged in some activities like arranging demo tents, advertising so that people come to know what Vijaya product is. They need to expand their product in other cities outside Hyderabad and secunderabad in order to get more awareness about the product to increase sales and services provided by them. It is highly recommended that Vijaya must increase its advertising strategy as many people have not heard about Vijaya Waters yet.

APPENDIX

QUESTIONNAIRE

NAME: DESIGNATION: ADRESS: PHONE NUMBER: EMAIL: -

1. What type of package drinking mater you consume? a) Bisleri b) Kinley c) Aquafina d) Bibo e) Qua 2. Do you use any Vijaya product? a) Yes b) No 3. If yes, which Vijaya product? a) Pasteurized Milk b) Ghee

c) Butter d) Curd 4. What is your opinion about Vijaya products advertising techniques? a. Bad b. Average c. Good
d. excellent

5. Is Vijaya Package drinking Water advertising informative? a) Yes b) No 6. Where did you come across our advertisement? a. Newspaper b. Television c. Radio d. Magazines
e. Hoardings & Pamphlets

7. Did our advertising techniques urge you to buy our product? a. Yes

b. No

8. Do you think our products are affordable? a. Yes

b. No

9. Where do you rank Vijayas package drinking Water? a. Excellent b. Good c. Bad d. Average

THANK YOU

Signature-

Date-

BIBILOGRAPHY

 http://www.google.co.in/ http://www.wikipedia.org/ http://VijayaWater.org/ http://kool-foods.com/Vijayaproducts.html http://Vijayaproduct.hpage.com/