NATIONAL INSTITUTE OF AGRICULTURAL MARKETING, JAIPUR

PROJECT REPORT ON IMPACT OF ADVERTISEMENT ON SALES OF BISCUITS

DATE: 10/11/2011

SUBMITTED TO : Mr. UDAY BHATI MARKET RESEARCH FACULTY NIAM, JAIPUR

SUBMITTED BY : Group 2 VIVEK VISHAL RAVI GUPTA SAURABH LOHANI SHIVANGI SOOD DHARA SINGH MEENA SHASYA AGRAWAL SHAKTI SHARMA DR. BHOOPENDRA KUMAR MISHRA RAJENDRA GODARA PRIYAM CHATURVEDI

Effect of Advertise and promotion sales of biscuits Since Biscuits are convenience goods, new tastes and new products are essential to built excitement in the market Biscuits are consumed by people of all ages, from the rich to the poor, living in cities & in villages. While some have it for breakfast, For others it is a complete wholesome meal. For some it's the best accompaniment for tea, While for some it's a way of getting charged whenever they are low on energy. Source- According to FGD conducted

Source- Adex India

Biscuit industry practices mass marketing, which appeals to masses. It is a product liked by everyone and does not cater only to a specific group or part of the whole market. Thus the industry adopted mass production, mass distribution and mass promotion of products for all buyers.

Most of the companies in the industry adopted the Market Penetration strategy i.e. low price along with capturing of a large market Also they focus on providing good quality products at the same time, which means it uses the value pricing method. The value-for-money positioning helps generate large sales volumes for the products.

Effect of advertisement on Market share and sales

45 40 35 Britania Parle

Market share (in %)

30 25 20 15 10 5 0
Surya Food Saj Industries

Sunfeast

-500

-5 0

500

1000

1500

2000

2500

3000

3500

Sales in Rs. Crore

Width of the circles represents advertisement share of the respective company. The graph shows that the company having large advertisement share also have large sales and market share. Advertising Strategy1. Considering Price The biscuits industry now has two clear models. Parle products play the low price game at all varieties of biscuits from glucose to cream. Essentially, Parle plays a high volume, low margin game. But Britannia and Sunfeast look at a two pronged strategy, High margins in cream variants and low margin in the Marie and Glucose segments. For instance, cream biscuits from both Britannia and Sunfeast cost Rs 10 for 100 grams. Parle, however, only charges Rs 5 for its cream variants. Except for Hide & Seek, all of Parles products lie in the price range between Rs 4 and Rs 6 for 100 gram packs. 2. Considering Packaging Packing Biscuits' packaging has undergone a swift transformation. From Britannia's functional Protective blister wraps, which prevent breakage, to Parle's stylish offering packaging has been completely transformed. The importance of packaging can further be gauged from the fact that packaging constitutes a fair portion (10 to 25%) of the entire cost of the pack.Its common sight now that retailers are keeping small packs of biscuit in Jar. Britannia as well as Parles biscuits are now available in Jars and products priced in the range of Rs12/- Rs15/- also.

Advertising MediaA recently completed survey conducted by The Nielsen Company on media spends reveals that advertising spends in main media television, newspaper and magazine in India has soared by 32 per cent in the first quarter of 2010. This is the highest growth amongst the 12 major markets in the Asia Pacific region. Overall, across the 12 markets, media spends grew by 18 per cent.

20 15 10 5 0

TOP 10 SECTORS IN PRINT ADVERTISING

% share

Different ways of Sales Promotion Ads on promotion contest promoton volume promotion
10% 17%

73%

BISCUIT ADVERTISING THROUGH PRINT MEDIA IN 2010 23% 3% 9% Parle G Britannia 18% priya gold 21% 26%

Sunfeast

Bisk Farm

others

Industrys ability to connect to large population through various promotional events (such as schools industry visits to plant, talk & TV shows, rural programs) to target different age segment will decide the market share. Biscuits are available to consumers, even in the most remote places and in the smallest of villages with a population of just 1500.

ADVERTISEMENTS:

spending on biscuit advertising

general interest children publications 3%1% 1% 8% women's magazine youth others

87%

The products were advertised mainly through Print and electronic media. The communication spoke about the basic benefits of energy and nutrition. Good advertisement policies due to which people are motivated to buy their product at least once. For instance, ITC has the advertisement about a child entering the cream world makes the children excited about the product leading to increase in sales. In theyear 1997, Parle-G sponsored the tele-serial of the Indian superhero, Shaktimaan that went on to become a huge success. ITC typically follows a branding strategy under the umbrella name "Sunfeast". With multiple sub-brands created under this banner. This has been logical for ITC due to its late arrival into this category. A common brand name across its portfolio would ensure better recall among the consumers. Parle sales strategy: Parle :Punch lines for different products: Parle G - G For Genius Parle G Hindustan Ki Shakti Parle Monaco Life Namkeen Banaye Krack Jack- Taste Ka Double Role Khol Sakta Hai Aapki Pole Krack Jack -Sweet Bhi , Salty Bhi Parle Kreams Gold- Beech Me Dhamal Parle Milk Shakti- Shakti Behind Team Chennai Parle Milk Shakti -What First Rankers Have For Breakfast: Milk And Honey

Latest Entrants with innovative products also eyes for capturing market 1. The introduction (of Oreo) marks the entry into a new category in India, with the aim to make the worlds favourite biscuit, Oreo, one of Indias favourite biscuits," Cadbury India said in a statement. Oreo is around 100 years old brand and currently generates revenue of $1 billion globally. In India, the company will be launching the biscuit in dark chocolate flavour. 2. Frito-Lay India, the food division of PepsiCo India has recently launched Aliva new baked savory cracker category, borrowing ingredients and textures from biscuits and flavored experiences from namkeens especially for the Indian consumer. Assumption- Effect of Brand ambassador on the sales of biscuits
Absolute increase in sales 2006-07 2007-08 2008-09 2009-10 415.15 238.86 408.08 190.18 360.92 170.42 468.55 567.54 -21.8 70.35 42.63 53.35 -7.83 13.4 52.73 48.17 -1.99 7.31 -3.67 -11.3

Brand 2005-06 Britannia 183.24 Parle 251.05 Surya 11.66 Anmol 58.8 Priya 6.35

Brand Ambassador Rahul Dravid Amir Khan, Hritik Roshan Karishma Kapoor Baichung Bhutia Ashish Nehra

Source- CMIE report 2009-10

InferencesBritannia-India Lost World cup match in this year, Rahul was Captain. He resigned from captainship on September. This had negative impact on brand as sales dipped. Parle-Amir Khan gave two super hit movies prior to this, and in the advertisement he wore the same look as that of his hit movie - gajini. There is a great increase in sales. This shows positive impact. Surya-Karishma Kapoor by this time had reduced fan following. This had impact on sales too. Anmol- Baichung Bhutia has a great fan following in Eastern region. The hike in sales depicts the positive relation with his image and fan following. Priya- Ashish Nehra had good innings in 2003, but due to his injuries he could play in following years, mainly the years 2005 and 2006 was blank. This shows the positive and negative impact shown in the table. Conclusion- The brand ambassadors have deep relation with the products they endorse; hence they should be selected keeping in view of their near future performance as the effect of the change in their fan following usually takes up to a year to get reflected in the market sales.

Source1. CMIE report 2009-10

2. www.tamindia.com 3. www.itcportal.com 4. www.docstoc.com 5. http://mofpi.nic.in 6. www.ibmabiscuits.in/industry-statistics.html 7. http://business.mapsofindia.com/india-industry/biscuits.html 8. http://foodbizdaily.com