INTRODUCTION

Sales Promotion

Sales promotion, a key ingredient in marketing campaigns, consists of a

diverse collection of incentive tools, mostly short term, designed to

stimulate quicker or greater purchase of particular products or services by

consumers or the trade.

Whereas advertising offers a reason to buy, sales promotion offers an

incentive to buy. Sales promotion includes tools for consumer promotion

(samples, coupons, cash refund offers, process off, premiums, prizes,

patronage rewards, free trials, warranties, tie-in promotions, cross-

promotions, point-of-purchase displays, and demonstrations); trade

promotion (prices off, advertising and display allowances, and free goods);

and sales force promotions (trade shows and conventions, contest for sales

and specialty advertising). These tools are used by most organizations,

including non-profit organizations. Churches, for example, often sponsor

bingo games, theatre parties, testimonial dinners and raffles.

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 A decade ago, the advertising to sales-promotion ratio was about

60:40. Today, in many consumer packaged-good companies, sales

promotion accounts for 65% to 75% t of the combined budged. Sales

promotion expenditures have been increasing as a percentage of combined

budget expenditure annually for the last two decades. Several factors

contribute to this rapid growth, particularly in the consumer markets.

Promotion is now more accepted by the top management as an effective

sales tool; more product managers are qualified to use sales-promotion

tools; and product managers are under pressure to increase current sales. In

addition, the number of brands has increased; competitors use promotions

frequently; many brands are seen as similar; consumers are more price-

oriented; the trade has demanded more deals from the manufacturers; and

the advertising efficiency has declined because of rising costs, media clutter,

and legal restraints.

The rapid growth of sales-promotion media has created clutter similar

to the advertising clutter. Manufacturers have to find ways to rise above the

clutter-for instance, by offering larger coupon-redemption values or using

more dramatic point-of purchase displays and demonstrations.

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Purposes of Sales promotion

Sales-promotion tools vary in their specific objectives. A free sample

stimulates consumer trial, whereas a free management-advisory service aims

at cementing long-term relationship with a retailer.

Sellers use incentive-type promotion to attract new, to reward loyal

customers, and to increase the repurchase rates of the occasional users. Sales

promotion often attracts brand switchers, who are primarily looking for low

price, good value, or premiums. Sales promotions are unlikely to turn them

into loyal users. Sales promotions used in markets of high brand similarity

produce a high sales response in the short term but little permanent gain in

the market share. In markets of high dissimilarity, sales promotion can alter

market shares permanently.

Farris and Quelch cite a number of sales promotion benefits flowing

to manufacturers and consumers. Sales promotion enable manufacturers to

adjust to short-term variations in supply and demand. They enable

manufacturers to test how high a list price they can charge, because they can

always discount it. They induce the customers to try new products instead of

never straying from current ones. They lead to more varied retail formats,

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such as every-day-low-price store and the promotional-pricing store. They

promote greater consumer awareness of prices. They permit manufacturers

to sell more than they would sell at list price. They help the manufacturer

adapt programs to different consumer segments. Consumer themselves

enjoy some satisfaction from being smart shoppers when they take

advantage of price specials.

Today many marketing managers first estimate what they need to

spend in trade promotion, then what they need to spend in consumer

promotion. Whatever is left they will budget for advertising. There is

danger, however, in letting advertising take a back seat, because advertising

typically acts to build brand loyalty. The question of whether or not sales

promotion weakens brand loyalty is subject to different interpretations.

Sales promotion, with its incessant prices off, coupons, deals and premiums,

may devalue the product offering in the buyers’ minds. Buyers learn that the

list price is largely a fiction. However, before jumping to any conclusion, we

need to distinguish between price promotions and added-value promotions.

However, usually, when a brand is price promoted too often, the

consumer begins to devalue it and buy it mainly when it goes on sale. So

there is risk in putting a well-known brand leader on promotion over 30% of

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time. Dominant brands offer deals frequently, because most deals only

subsidize current users. Brown’s study of 2,500 instant-coffee buyers

concluded that:

 Sales promotions yield faster and more measurable responses in

sales than advertising does.

 Sales promotions do not tend to yield new, long term buyers in

mature markets because they attract mainly deal-prone consumers

who switch among brands as deals become available.

 Loyal brand buyers tend not to change their buying patterns as a

result of competitive promotion.

 Advertising appears to be capable of deepening brand loyalty.

There is also evidence that price promotions do not build permanent

total category volume. Small share competitors find it advantageous to use

sales promotion, because they cannot afford to match the market leaders’

large advertising budgets; nor can they obtain shelf-space without offering

trade allowances or stimulate consumer trials without offering incentives.

Price competition is used by small brand seeking to enlarge its share, but it

is less effective for category leader whose growth lies in expanding the

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entire category. The upshot is that many consumer packaged goods

companies feels that they are forced to use more sales promotions than they

wish. They blame the heavy use of sales promotion for decreasing brand

loyalty; increasing consumer price-sensitivity; brand quality image dilution,

and a focus on short-run-marketing planning.

Major decisions in Sales Promotions

In using sales promotion, a company must establish its objectives,

select the tools, develop the program, pretest the program, implement and

control it, and evaluate the results.

Establishing the objectives

Sales promotion objectives are derived from broader promotion

objectives, which are derived from more basic marketing objectives

developed for the product. For consumers, objectives include encouraging

purchase of larger-sized units, building trial among non-users, and attracting

switchers away from competitors’ brands. For retailers, objectives include

persuading retailers to carry new items and higher levels of inventory,

encouraging stocking of related items, offsetting competitive promotions,

building brand loyalty, and gaining entry into new retail outlets. For the

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sales force, objectives include encouraging support of a new product or

model, encouraging more prospecting, and stimulating off-season sales.

Marketing Memo: Sales Promotions as brand builders

Building brand awareness is a long-term process. What a brand does today predicts
what it will do tomorrow. Sales promotions are short term and temporary. Here are
some of the tips on how to make a sale promotion an effective brand-building tool.
 Make sure the promotion is justified: A new store opening, a company
anniversary, and other kinds of celebrations are all good reasons for running a
promotion
 Tie the promotion to brand’s image: Birth dates and anniversaries are good
 Look at every both for the sales job it can do and as a communication tool: A
promotion is one of a brand’s many voices; it can help build brand awareness
if it says the right things

Source: Adapted from Jacques Chevron, “Branding and Promotion: Uneasy

combination.” Brand week, September 14, 1998, p.24

Selecting Consumer-promotion tools

The promotion planner should take into account the type of the

market, sales promotion objectives, competitive conditions, and each tool’s

cost effectiveness.

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 The main consumer promotion tools are summarized in the following

table. We can distinguish between manufacturer promotions and retailer

promotions. Sales promotions are most effective when used together with

advertising. In one study, a price promotion alone produced 15% increase in

sales volume. When combined with feature advertising, sales volume

increased 19% when combined with feature advertising and a point-of-

purchase display, sales volume increased 24%

door, sent in the mail, picked up in a store, attached to another product, or

featured in an advertising offer.

Coupons: Certificates entitling the bearer to a stated saving on the purchase of

a specific product; mailed, enclosed in other products or attached to them, or

inserted in the magazine and newspaper ads.

Cash Refund Offers (rebates): Provide a price reduction after purchase rather

than at retail shop; consumer sends a specified “proof of purchase” to the

manufacturer who “refunds” part of the purchase price by mail.

Price Packs (cents-off deals): Offers to consumer savings off the regular price

of a product, flagged on the label or package. A reduce price pack is a single

package sold at the reduce price (such7 as two for the price of one). A banded

pack is two related products banded together (such as a toothbrush and

Manufacturers use a number of trade promotion tools. Surprisingly a

higher percentage of promotion pie is devoted to trade promotion tools (46.9

%) than to consumer promotion (27.9%), with media advertising capturing

remaining 25.2 %. Manufacturers use award money to the trade

1. To persuade the wholesaler or retailer to carry the brand;

2. Persuade the retailer or wholesaler to carry more units than the

normal amount;

3. To induce the retailers to promote the brand by featuring, display, and

price reductions and;

4. To stimulate retailers and their sales clerks to push the product.

The growing power of large retailers has increased their ability to demand

trade promotion at the cost of consumer promotion and advertising. The

different trade promotions are

Price off (off-invoice or off list): A straight discount off the list price on each

case purchased during a stated time period.

Allowance: An amount offered in return for the retailer’s agreeing to feature

the manufacturer’s products in some way. An advertising allowance

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compensates the retailers for advertising the manufacturer’s product. A

display allowance compensates them for carrying a special product display

Free Goods: Offers of extra cases of merchandise to intermediaries who buy

a certain quantity or who feature a certain flavor or size

Source: For more information, see Betsy Spethman, Trade Promotion

Redefined, Brandweek, March 13, 1995, pp. 25-32

Selecting Business- and sales-force-promotion tools

Companies spend billions of dollars on business-and sales-force-promotion

tools as shown in the table. These tools are used to gather business leads,

impress and reward customers, and motivate the sales force to greater effort.

Companies typically develop budgets for each business-promotion tool that

remain fairly constant from year to year.

Trade Shows and Conventions: Industry associations organize annual trade

sows and conventions. Business marketers may spend as much as 35 % of

their annual promotion budget on trade shows

Sales Contests: A sales contest aims at including the sales force or dealers to

increase their sales over a stated period, with prizes (money, trips, gifts or

points) going to those who succeed

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Specialty Advertising: Specialty advertising consists of useful, low cost

items bearing the company’s name and address, and sometimes an

advertising message that salespeople give to prospects and customers.

Common items are ballpoint pens, key chains, flashlights, tote bags, and

memo pads.

OBJECTIVE OF THE STUDY

 To know awareness of people towards Amul Prolife & Ice cream .

 To know in which segment ice cream are mostly like/preferred.

 To know which advertisement tool is mostly preferred by people.

 To know the preference of Amul ice cream with comparison to other competitive

brands.

 To know the factors which affects consumer’s buying behavior to purchase

prolife & sugar free ice cream.

 Create awareness about the Probity ice cream

 To collect the detailed data by filling up the questionnaire from the APO’S/A

class outlets or parlors

 To collect the detailed data with respect to AMUL Outlets.

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 To collect information about the AMUL Prolife & ice cream by different APO’S

& A class outlets

 To collect detailed information about the price, supply or any required

improvement towards the AMUL Prolife & ice cream.

 To give suggestion provided by the outlets to the company for improvement of

AMUL Prolife & ice cream/Products

SCOPE OF THE STUDY

 To study the marketing strategies of the Amul Ice Cream Company.

 To study the various products and their prices.

 To study the various plans and schemes.

 To study the preference of those factors which are considerable by the customer.

 To analyze the satisfaction level of the customer.

 To analyze the market share of Amul Ice Cream Company.

 To show the coverage area of Amul Ice Cream Company.

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COMPANY PROFILE

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Amul (Anand Milk Union Limited), formed in 1946, is a dairy cooperative

movement in India. It is a brand name managed by an apex cooperative

organisation, Gujarat Co-operative Milk Marketing Federation

Ltd. (GCMMF), which today is jointly owned by some 2.6 million

milk producers in Gujarat, India. It is based in Anand town of

Gujarat and has been a sterling example of a co-operative

organization's success in the long term. The Amul Pattern has

established itself as a uniquely appropriate model for rural

development. Amul has spurred the White Revolution of India, which

has made India the largest producer of milk and milk products in the

world. It is also the world's biggest vegetarian cheese brand .

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In the year 1946 the first milk union was established. This union was started

with 250 liters of milk per day. In the year 1955 AMUL was

established. In the year 1946 the union was known as KAIRA

DISTRICT CO-OPERATIVE MILK PRODUCERS’ UNION. This

union selected the brand name AMUL in 1955. It is a brand name

managed by an apex cooperative organization, Gujarat Co-operative

Milk Marketing Federation Ltd. (GCMMF), which today is jointly

owned by some 2.6 million milk producers in Gujarat, India. It is based

in Anand town of Gujarat and has been a sterling example of a co-

operative organization's success in the long term. The Amul Pattern

has established itself as a uniquely appropriate model for rural

development. Amul has spurred the White Revolution of India, which

has made India the largest producer of milk and milk products in the

world. It is also the world's biggest vegetarian cheese brand .

The brand name Amul means “AMULYA”. This word derived

form the Sanskrit word “AMULYA” which means “PRICELESS”. A

quality control expert in Anand had suggested the brand name “AMUL”.

Amul products have been in use in millions of homes since 1946. Amul

Butter, Amul Milk Powder, Amul Ghee, Amulspray, Amul Cheese,

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Amul Chocolates, Amul Shrikhand, Amul Ice cream, Nutramul, Amul

Milk and Amulya have made Amul a leading food brand in India. (The

total sale is Rs. 6 billion in 2005). Today Amul is a symbol of many things

like of the high-quality products sold at reasonable prices, of the genesis of a

vast co-operative network, of the triumph of indigenous technology,

of the marketing savvy of a farmers' organization. And have a proven model

for dairy development (Generally known as “ANAND PATTERN”).

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 Gujarat Cooperative Milk Marketing Federation (GCMMF)

Gujarat Cooperative Milk Marketing Federation (GCMMF) is India's

largest food products marketing organisation. 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.

Amul's product range includes milk powders, milk, butter, ghee, cheese,

curd, chocolate, ice cream, cream, shrikhand, paneer, gulab

jamuns, basundi, Nutramul brand and others. In January 2006,

Amul plans to launch India's first sports drink Stamina, which will be

competing with Coca Cola's Powerade and PepsiCo's Gatorade .

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Amul is the largest food brand in India and world's Largest Pouched Milk

Brand with an annual turnover of US $1050 million (2006-07).

Currently Amul has 2.6 million producer members with milk collection

average of 10.16 million litres per day. Besides India, Amul has entered

overseas markets such as Mauritius, UAE, USA, Bangladesh,

Australia, China, Singapore, Hong Kong and a few South African

countries. Its bid to enter Japanese market in 1994 had not succeeded,

but now it has fresh plans of flooding the Japanese markets .Other

potential markets being considered include Sri Lanka.

Dr Verghese Kurien, former chairman of the GCMMF, is recognised as the

man behind the success of Amul. On 10 Aug 2006 Parthi Bhatol,

chairman of the Banaskantha Union, was elected chairman of

GCMMF.

ACHIEVEMENT:

Amul : Asias largest dairy co-operative was created way back in 1946 to

make the milk producer self-reliant and conduct milk- business with

pride. Amul has always been the trend setter in bringing and adapting

the most modern technology to door steps to rural farmers.

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Amul created history in following areas:

a)First self motivated and autonomous farmers organization comprising of

more than 5000000 marginal milk producers of Kaira District.

b) Created Dairy co-operatives at village level functioning with milk

collection centres owned by them.

c) Computerized milk collection system with electronic scale and

computerized accounting system.

d)The first and only organization in world to get ISO 9001 standard for its

farmers co-operatives.

e)First to produce milk from powder from surplus milk.

Amul is the live example of how co-operation amongst the poor marginal

farmers can provide means for the socio-economic development of the

under privileged marginal farmers.

Amul in abroad:

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Amul is going places. Literally. After having established its presence in

China, Mauritius and Hong Kong, Gujarat Cooperative Milk

Marketing Federation (GCMMF), Indias largest milk cooperative, is

waiting to flood the Japanese market.

Then, GCMMF is also looking at Sri Lanka as one of its next export

destinations. Amul products are already available on shelves across

several countries, including the US, China, Australia, West Asian

countries and Africa.

GCMMF recorded a turnover of Rs 2,922 crore last fiscal. Its products

include pouch milk, ultra heat treated (UHT) milk, ice cream, butter,

cheese and buttermilk.

PEOPLE POWER: 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

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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 rotes

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 agro-economic 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

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  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. Basically the union and cooperation of people brought

Amul into fame i.e. AMUL (ANAND MILK UNION LIMITED), a name

which suggest THE TASTE OF [Link] sells 35 million litres of ice-

cream valued at more than Rs 200 crore out of a total branded ice-cream

market of 100 million litres worth Rs 600 crore. The Amul ice cream

business is currently growing at the rate of more than 20%.

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PLANTS

First plant is at ANAND, which engaged in the manufacturing of milk,

butter, Ghee, milk powder, flavored milk and buttermilk.

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Second plant is at MOGAR, in Rajasthan which engaged in manufacturing

chocolate, nutramul, Amul Ganthia and Amul lite.

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CONCLUSION

As we know that Amul is very big organization and market leader in dairy

products. It has maximum market share in Milk, Butter and Cheese, which

are its main/core products. As we know Amul is a co-operative organisaion

with a profitable industry we can’t ignore it. With the help of research,

company can find out its week points in Prolife product and can increase its

market share through rectify mistakes. People have believed in Amul’s

product.

The survey resulted into following conclusions:

 Amul must come up with new promotional activities such that

people become aware about Amul Products.

 Quality is the dominating aspect which influences consumer to

purchase Amul product, but prompt availability of other Prolife

brands and aggressive promotional activities by others influences

the consumer towards them and also leads to increase sales.

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LIMITATION

 Limited time available for interviewing the respondents. As a result of

this it was not possible to gather full information about the

respondents.

 When I interviewed children and teenagers, sometimes they use to

 give answers under the influence of their parents or elders.

 As summer training is going under summer season so sometimes

 people are less interested in filling up questionnaire..

 Non-cooperative approach and rude behavior of the respondents.

 If the respondents answer does not falls between amongst the options

given then it will turn up to be a biased answer.

Some time outlets and parlours owner did not give proper knowledge

and time about my queries.

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BIBLIOGRAPHY

BOOKS:

 Kothari, C.R. “Research Methodology”, (2006), Wishwa Publication

 Kotler Philip “Marketing Management”.

Bibliography :

1. [Link]

2. [Link]

3. [Link]

4. [Link]

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