Competitors Strategy With Britannia

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The products distribution and marketing

ABSTRACT

Most producers do not sell their goods directly to final users. They design a multi-channelsystem to reach them. The design of marketing channel, that acts, as a strong interface, canprovide competitive advantage to a firm in the industry. By contrast the absence of a gooddistribution network can also be a major fiasco in todays cutthroat competitive world.Marketing channel decisions are the most critical ones facing the marketing managementtoday. It is complex and the complexity further gets compounded by the fact that the channelsystem take time to build usually years. Channel partners are not owned by the company inmost cases. The sales force plays a crucial role in getting the best out of marketing channel.Integrating the efforts of channel partners and sales efforts within the whole marketing effortbecomes crucial towards achieving organizational goals. Food and beverage giant Parle had

entered into a franchisee agreement with Keventer Agro, for Keventer Agro to manufacture,package, distribute and market its well-known brands namely Frooti -a popular mango drink,Appy and Appy Fizz-the in-style apple drinks and Bailley Packaged Drinking Water mostlyin the eastern parts of India. The project Study of the distribution channel and market analysisof the products distributed and marketed by Keventer Agro under the license of Parle Agroinvolves the study of the strategies undertaken by Keventer Agro to distribute and marketproducts of Parle Agro which includes Parles HIPPO Parle Agro forayed into snacks with thelaunch of Hippo, in line with the companys vision of becoming a major player in the foodsand beverages industry. Hippo is a player of the snack food industry of India. As per anindustry estimate, the branded and organized snack food segment dominated by major playerssuch as Frito Lay, Con Agra, Kelloggs, Marico, Dabur, HLL, ITC, Parle, Haldirams. Thus,

the study mainly constituted of studying and analyzing the distribution channel of Hippo anddoing a market analysis of the product with respect to pricing, competition, brand awareness
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and consumer behavior of Hippo its present market position in relation to the well knownestablished brands through retailer and consumer survey. Questionnaire, Schedule andinterview and observation methods have been used in conduction of surveys.

After completion of analysis of data collected through various methods regarding the sales

and distribution and market position and other strategies proper conclusions can be drawnabout the awareness and market strength and potential of Parles Hippo. These conclusion anddeductions will help Keventer Agro to make any possible changes that would be feasible forthe sustenance of the brands and any measure that will increase the market penetration of thebrands

Introduction

The Project The project Study of the distribution channel and market analysis of the of theproducts distributed and marketed by Keventer Agro under the license of Parle Agro involvesthe study of the strategies undertaken by Keventer Agro to distribute and market Parle HippoKeventer Agro: The Company Keventer Agro Limited is a subsidiary of Keventer Groupwhich has been operating years in the Food Processing Industry in India for more than 125years. Keventer exports Alphonso Mango Pulp, Totapuri Mango Pulp, Guava Pulp,Sweetened Alphonso Mango Pulp, Mango Pickle, Sesame Seed, Cashew Nuts, Peanuts,Cumin Seed, Fennel Seed, Fenugreek, Coriander Seed, Bakery Ingredients, Fruit Jams, TuttiFruiti, Red Chilies & Button Mushrooms etc. to various countries. Keventer Agro Ltd. (KAL)was established in the year 1986. The division exports food products such as Mango Pulp,Guava Pulp, Sesame Seeds, and Bakery Ingredients to various customers across the globe. Inno time, it earned the coronet of being the first to introduce aseptic packaging in the beveragecategory (a high-end packaging procedure that preserved the natural goodness of drinks in

hygienic packs). The Group entered into a franchisee agreement with the food and beveragegiant -PARLE to manufacture, package, distribute and market its well-known brands namelyFROOTI -a popular mango drink, APPY and APPY FIZZ- the in-style apple drinks andBAILEY PACKAGED DRINKING WATER mostly in the eastern parts of India. In late2010, Parle Agro inked another agreement with Keventer Agro to set up a plant at Barasat.This new unit manufactures Parle Agros snack brand Hippo. Besides manufacturing,Keventer is also responsible for marketing, sales and distribution of Hippo. Parle Agro choseto partner Keventer for their range of food brands which w.ll h.l. them to expand Hipposmarket share in the eastern part of India.

Parle Agro: The Company Parle Agro is a household name in the beverages industry and has

leading brands like Frooti, Appy, Appy Fizz and packaged drinking water, Bailley. A pioneerin the Indian industry, Parle Agro were the first to introduce fruit drinks in tetra packaging,first to introduce apple nectar and the first to introduce fruit drinks in PET bottles. In 2007,Parle Agro forayed into foods with the launch of two confectionery brands, Mintrox mintsand Buttercup candies. This was soon followed by two more brands Buttercup Softease andSoftease Mithai. Recent beverage products from Parle Agro include Saint Juice, LMN andGrappo Fizz. In 2009, Parle Agro forayed into snacks with the launch of Hippo, in line withthe companys vision of becoming a major player in the foods and beverages industry. Thesnack brand Hippo, was launched in the western region starting with Maharashtra and then itwas soon rolled out nationally. Parle Agro commenced operations in 1984. Starting with onlybeverages and diversifying to include bottled water in 1993 and confectionery in 2007. Frooti

was the first product that was rolled out of Parle Agro in 1985. It went on to become Indiasfavourite mango drink. It still has a leading market share. Parle Agro Pvt. Ltd operates under


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three business vertical Beverages fruit drinks, nectars, 100% Juice, sparkling drinks, WaterPackaged Drinking Water and Foods confectionery, snacks

Product & Industry Overview

Product: HIPPO

Parle Agro forayed into snacks with the launch of Hippo, in line with the companys vision ofbecoming a major player in the foods and beverages industry. Hippo is a toasted bread snack.Its ingredients include wheat flour, edible vegetable oils, seasoning mix, corn starch, sugar,raising agent, milk solids, salt, emulsifier, yeast extract powder, instant yeast. It containsadded natural color and added natural identical flavoring substances; but no added MSG, noGMO and no Trans Fat. It comes in two variant; Hippo Munchies and Hippo Round-Round.The Hippo Munchies comes in 7 flavours (Chinese Manchurian, Hot-n-Sweet Tomato, ThaiChilli, Yoghurt Mint Chutney, Italian Pizza, Indian Chatpata and Arabian Salted) and HippoRound-Round comes in 5 flavours (Punjab Da Pickle, Gujrati Mango Chatni, ShillongNoodle Masala, Goan Butter and Garlic, Firangi Cheese n Spice). It is available in three sizeswhich are priced at Rs 5, Rs 10 and Rs 20. Snack Industry: Industry to which Hippo belongsHippo is a player of the snack food industry of India. The Indian snack industry is one of thelargest when considered in the global level. With rising standard of living, people are moreresorting to snacks items during breakfast, supper or any time; snacks most often take theplace of meals. Right from production, using up, export and growth prospects owing toemerging markets, increasing demand, and incorporation of latest technologies, the snackindustry in India has witnessed a dramatic change. Ready-to-eat foods, samosas, kachoris,namkeen, chips, are few of the snacks that are most preferred by Indians. Given the risingdemand, the snack industry is going to witness further growth in the future.

The snacks food industry in India can broadly be categorised into three segments staple(biscuits category), traditional (namkeens) and ready-to-eat packaged snacks (chips / crisps).

The snack food market in India is $3 billion; with the organized segment accounting foralmost half of the market share and growing at rate of 15 to 20 percent per year. A growingeconomy, changing lifestyles, rise in disposable incomes and preference for quality productsof U.S. origin will continue to fuel growth of imported U.S. snack food items in India. As peran industry estimate, the branded and organized snack food segment dominated by majorplayers such as Frito Lay, Con Agra, Kelloggs, Marico, Dabur, HLL, ITC, Parle, Haldirams,Nestle, Britannia, Cadbury, Bikano and Balaji is estimated to grow by 15 to 20 percent peryear; whereas the growth of un-branded snack food is likely to grow modestly at 8 percentper year in the near future. Frito-Lay India led sweet and savory snacks with a retail valueshare of 46% in 2009. The companys Kurkure, Lehar and Lays Stax offerings have helped itto consolidate its leadership during the year. Haldiram Foods International Ltd and ITC Ltdremained the second and third ranked players respectively. Products like Hippo claim to bemade from healthier ingredients than chips/crisps. With Indian consumers becoming more
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health conscious and more inquisitive about the ingredients in their food, sweet and savorysnacks will witness an increase in products which are positioned as better for you andhealthier snacks.

Objectives of the Project

To execute a qualitative study on the trend of packaged snack industry

To gauge the acceptance of baked and healthy-snacks

To understand competitor's strategy in the market

To study the sales and distribution structure, pricing (both to the retailer and to the consumer)of Hippo and problems in those respected area.

To develop marketing strategies for Hippo

To analyze the markets and determine the factors responsible for sale of products and providerecommendations about the scope for improvement.

To provide a statement of collective responses of the retailersand determine the scope forimprovement in the distribution channel for the products and the problems faced by theretailers.

To study the pattern of consumer behavior and their awareness towards HIPPO

To find out the problems faced by HIPPO if any and suggest solution to address thoseproblems Project Methodology Primary Research is done through market survey. Theresearch is mainly based on:

Questionnaire Method

Interview Method

Observation Method Secondary Research has also been used as a supporting tool like: Someof the data related to holistic picture of the industry has been gathered from the data availableon the internet

PROJECT PROFILE

The project revolves around Parle Hippo distributed and marketed by Keventer Agro underthe license of Parle Agro. The first stage constituted of mainly studying and analyzing thedistribution channel of Hippo and doing a market analysis of the product with respect topricing, competition, brand awareness and consumer behavior of Hippo through retailer andconsumer survey As per the objective of the project, two sets of questionnaire were prepared;

For the retailer which aimed to assess the availability of Hippo, pricing of Hippo, sales,defect handling and some financial aspect of Hippo viz. Its competitors and the other for theconsumers.


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For the consumer which aimed to gauge awareness of the product and the brand, productacceptance, their choice of product and buying pattern. The second stage constituted ofobserving the total sales procedure which consists of division of product, division of area,selective loading, selling, collection and submission

STAGE ONE: RETAILER SURVEY FOR HIPPO

This stage involved daily visits from the stock points to the designated markets. The marketscovered includes:

Salt Lake,

Lake Town,

S.K. Deb Road Market,

Nagerbazar,

Mrinalini Cinema Hall Market,

New Market,

Ultadanga,

Kankurgachi,

Bagmari,

Beadon Street ,

Aurobindo Road and Vivekananda Road area,

Shyambazar,

Rajballavpara

Baghbazar. Every shop that kept branded snacks in the respective areas was approached. The

initial plan was to conduct the survey through questionnaire method but while performing thesurvey the method had to be changed to schedule, observation and interview method as it wasnot convenient for the retailers to fill up the questionnaire

Objectives of Survey by observation method Findings to be recorded through observationmethod included:

The visibility of Hippo and of competitors' product

Mode of stocking/displaying Hippo and competitors' products i.e. whether it is on shelve orin the basket or inside almirah

The location of the store i.e. whether it is beside main road or inside a lane or on a square


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Type of store

Approximate demography Objectives of Survey by schedule method Findings to be recordedthrough schedule method included:

About Hippo: Whether he keeps Hippo or not, if not the reason, its availability, reorderperiod, quality of defective product handling', margin offered, supply of banners anddanglers.

About Competitor: The competition brand kept, approximate margin they offer.

About the market as a whole: The most selling brand. Objectives of Survey by interviewmethod The interview methodology aimed to gain the intrinsic details of the market functionssuch as; if the retailer does not keep Hippo would he like to keep it future, the credit policy,frequency of visit of sales representative, retailer's view on Hippo's marketing strategy andscope of improvement.

STAGE TWO: TOTAL SALES PROCEDURE OBSERVATION

Distribution structure of Keventer Agro for Hippo Keventer Agro has 2-level consumermarketing channel. i.e. Manufacturing Unit>Distributor>retailer>Consumer. The product ismanufactured in their plant located in Barasat. The products are sold directly to distributorson cash. A sales representative is appointed to the distributor by Keventer, who representsKeventer Agro and works shoulder to shoulder with the distributor.

Level 1 Manufacturing unit to distributor

The distributor buys the product in cash and the price of the free products which are part ofbelow the line promotional activity are reimbursed on the claim made by the distributor. Thetransportation charge is borne by the distributor. Division of product and appointment ofdistributors: The aim of the company is:

To ensure not only the highly profitable established products, but also new products with lowinitial sales reaches the end of supply chain.

To ensures that all the SKUs of different products end up in the racks of retailers.

Parle Agro has wide and deep product line; it is difficult for a single distributor to manage allthe products. Earlier, Hippo was supplied to all the distributors of a specific area but ascoordination became difficult, they have changed their policy and now supplies only to onedistributor of the specific area. In some distribution area Keventer appoints more than onedistributor each having different divisions of product.

The division of products includes: Division A Division B Division C

(Full information about this division is not known since I never had the chance to work in thisdivison) 200 ml, 400 ml, 1.2 litre of Frooti 160 ml 500 ml 1.5 litre and 2 litre of Frooti 200

ml of Appy 500 ml, 1 litre, 2 litre of Bailley Packaged Drinking Water 100 ml, 250 ml ofFrooti 200 ml of LMN 600 ml of Bailley Soda. 300 ml, 500 ml and 1 litre of Appy Fizz The


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strategy of division of product along with division of distributor is adopted due to the reasondiscussed above. Level 2 Distributor to retailer Each distribution area is divided into fivedifferent distribution zones. They sell their products to those five zones in five days i.e.Monday to Friday. The sixth day which is Saturday is an extra day in which the salesrepresentative does the miscellaneous work such as:

If an order was not delivered on the due date then that product is delivered on Saturday.

They conduct an approximate survey to estimate or forecast the forthcoming weekly demand.

If a replacement of defective product was not done on the due date then it is also done inSaturday

Hippo along with other product that are in the same division are be loaded in the LCVeveryday. The flavours and quantities are not fixed. They load it according to the demandestimation of the zone. For example, on a particular day, more SKUs of Goan Butter and

Garlic flavour is loaded more than the average quantity; the reason being from theexperience, the sales representative found that when certain flavour/flavours are supplied tosome particular area/areas, the retailer has lower re-order period i.e. the flavour/flavours salesmore in that area depending on the demography of the area and buying pattern of theconsumers. Sometimes the sales representatives are given target. For example: If they can sell100 cases of Division A products on a particular day which includes Hippo, then they wouldget some incentive (Rs 250 extra). In that case, Division A products are loaded more,proportionally quantity of Hippo rises. However the elasticity of quantity of loading is lowfor Hippo compared to Frooti and Appy which are of high selling category. The salesrepresentative finds it easy and handy to sell Frooti and Appy than applying push strategy forHippo. Sometimes Hippo is not at all loaded in the LCV because the particular marketdemography could not accept Hippo and is not popular. Selling Each sales representative hasdifferent style of selling. Some capitalize on relationship between him and retailer and someon communication skill. Relationship marketing: In this type of marketing procedure, the SRdoes not start talking business in the first instance; rather he greets the retailer, talk aboutgeneral things like current affairs or about family which helps him to build a rapport andtrust. The trust and rapport becomes the psychological tool to win over the psychology of theretailer making it difficult for the retailer to reject the sales representatives selling proposal.Sometimes the sales representatives shares such good relationship with the retailers that theydon't even ask whether he needs anything or not but directly dump the products and producesthe bill. Credit sales are more by this procedure since the SR does not want to freeze the

warmth of the relationship. Communication Marketing In this procedure the SR starts talkingabout the business from the first go. The deliberation of the schemes or price seeks theattention of the retailers. Sales representative convinces the retailers by giving a clear pictureof the business model. For example: Suppose the shop is near a school, he would right awaysay with much conviction that Hippo is bound to sell and with Rs 1.23 margin per piece, itwould be a great business for him. He further elaborates on the schemes and produces a veryrosy picture.

The chances of credit sales are low. The sales representative of Keventer Agro is responsibleto write the bill of receipt where he mentions name of the shop, the date, quantity of totalproduct sold and its price. An account of free products is also scribed in the bill. The cash is

handled by the distributor's representative. Collection It is a process of collecting money forthe credit sales made. Usually Keventer does not encourage credit sales. However if any


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credit sales are made, the credit period is generally 2-3 days or the period till the next order,whichever is earlier. Collection is not so difficult as Hippo is backed by Frooti which hashigh bargaining power. Submission Both the representatives are required to submit everybills and cash respectively to the stock point/distributor. The cash collected and the sum totalof the bill has to tally. Problem identification and its solution: Problem 1: The targets that are

set by Keventer for the sales representatives are not distinct enough. The target constitutes ofonly two conditions i.e. name of Division and amount of cases. For example, on a particularday while we were working in certain area with the sales representative, he was given a targetto sell 100 cases of Division A product for an incentive of Rs 250. He worked till 8 pm andultimately reached to the target. However most of the sales were of Frooti and Appy withvery little proportion of Hippo. Solution to the problem: Providing target worked well but hadskewed portfolio. The target scheme for the sales representatives should be more distinct forexample, if the target would have been X cases Frooti, Y cases of LMN, Z cases of Appy andU cases of Hippo of Division A for Rs V then the sales representative would not havecapitalized on Frooti and Appy but would have tried to push low moving new brands such asHippo, Bailley Soda etc. The portfolio of sales would have been varied and would have

provided an impetus to the sales of new brands such as Bailley Soda and Hippo.

Problem 2: Most of the sales activities are done by the company representatives such:

Converting potential customer into actual customer in level 1 of distribution structure

Bagging re-order from the existing customer

Handling defective product

Negotiation and persuasion

Accounting( bill of receipt) The distributor only provides with infrastructure such as godown,light commercial vehicle(LCV) and a representative. The field work is mostly done by thecompany representative. Solution to the problem: Initially in a new market, it is quiterationale to capitalize on the market knowledge and relationships of the distributor but whileworking with sales representatives we found in some areas that the retailers already trust thecompany representative while the company representative has commanded the knowledge onthe respective market. In that scenario Keventer Agro can go for forward integration andmove on to 1-level distribution structure which consists of only manufacturer> retail>consumer eliminating the distributor. This would further optimize the profit earned by the

company

Evaluation of the distribution system of Parle Hippo through statistics This part of dataanalysis is segmented in to two parts. The first part deals with retailers and the second partdeals with the consumer. The first part is further broken up in to two scenarios. The firstscenario provides a holistic view of the markets surveyed and the second scenario deals withanalysis of the attribute according to the area in which the survey is conducted. Part I (A) -Holistic View of the Markets Surveyed 1. Hippo Stocked The graph below showcases thefrequency of the shops who stocks Hippo in their shops. 36.2% of the samples do not keepHippo, where as 24.6% of the sample use to keep Hippo and the rest however keeps Hippo.So it can be said that there are presently more shops where Hippo cannot be found. Since the

percentage of shops that use to keep Hippo is considerably high, we get a negative sales trendhere.


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9 definite reasons for the low sales turnover have been identified. They are:

Some of the shops were never approached by the distributor

Some shops are already flooded with competitor's product so there are no space to stock

Hippo

In Some areas, the supply was halted due distributor reappointment and other issues

Some shops use to keep Hippo but due to low sales they don't keep it anymore

Hippo has a limited credit option, so many retailer finds it difficult to block their money for anew product

Some retailer does not keep Hippo due to lack of merchandize provided. Retailers demandshelve and almirah so that they can store and display and also protect from mice but very

limited or no merchandize is provided to most of the retailers

Some retailers do not keep Hippo because they perceive that it is a new product with lowawareness, the market is still not ready to accept the product. Had it been ready, the consumerwould themselves ask for it

Some retailers complained about poor follow up from the sales team and is the reason for notkeeping Hippo

Some retailers, who use to keep Hippo complained that the expired stock were not replaced

and they have lost faith in Parle Agro

The chart provided below showcases the frequency of the reasons discussed above.Interpretations:

32.5% of the shops were never approached by the company. From the qualitative data it hasbeen found that many retailers were positive about keeping Hippo if they were beingapproached by the company.

12.5% of the shops have no space to keep Hippo. While conducting survey it is found thatmany shops were flooded with competitor brand leaving no space for Hippo.

Out of 24.6% of sample who use to keep Hippo, 11.2% stopped keeping Hippo due suddenhalt in supply due to distributor reappointment problem and other associated problems.

8.8% of the samples do not keep Hippo anymore due to its low sales while 2.5% of thesamples do not keep Hippo because of the credit policy. The low sales associated with limitedcredit policy makes it difficult for the retailer to invest in the slow moving stock.

1.2% of sample reported that they do not keep Hippo because Parle Agro do not provide themwith almirah or rack as result the products get damaged because of mice.


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Among the samples who never kept Hippo, 10% of the sample never kept Hippo because nocustomer demanded for it. They said, they will only keep Hippo when customer starts askingfor it. The demand graph is provided below.

Among those who use to keep Hippo, 8.8% of sample do not keep it anymore due to bad

follow up from the distributor. One of the samples was approached by the distributor ho tookorder but never delivered the products.

The expired date products were never replaced for which 2.5% of the sample does not keepHippo.

The reason for the 8.8% of the shops could not be gauged due to any response from theretailers.

2. Demand of Hippo: The graph below provides a holistic view about the demand of Hippo.42.7% of the sample said that the demand of Hippo is low while 33.7% of the sample said

that the demand is average followed by 23.6% of the sample who said that the demand ishigh. 3. Reorder period: Among the samples who keep Hippo, 57.6% of the sample orders ona weekly basis, 24.7% orders on a monthly basis, 10.6% on a fortnightly basis and 7.1% ofthe sample orders twice a week.

4. Most selling Stock Keeping Unit (SKU): 74.1% of the sample reported that the small packsare most selling stock keeping unit (SKU) while 25.9% of the sample reported about themedium pack. 5. Most selling flavour: On an overall analysis, we found that there is very lowconsistent pattern of choice of flavour. However 21.2% of the sample said that the bluishgreen pack (Goan Butter and Garlic) sells the most followed by Punjab Da Pickle.

6. Awareness of nutrition facts among retailers: 70.5% of the sample had no idea about Hippobeing baked but not fried while that 29.5% of the sample had idea about the health positivityof the product. Among 29.5 % of the samples who are aware of the fact only 2.4% of thesamples pitch about it while selling it.

7. Analysis of the margin/profit offered by Hippo and its competitors: The objective is to findwhether there is significant difference among the margin offered by three brands i.e. Lay's,Bingo and Hippo. In other words, it is a test for difference in distributions (medians) of themargin/profit for the different brands of snacks. Methodology applied is Kruskal-Wallis Test.The null hypothesis H0 = PL = PB = PH and the alternate hypothesis H1 is PL, PB and PH

are significantly different. PL = Proportion of retailer to whom Lays provide them withhighest margin PB = Proportion of retailer to whom Bingo provide them with highest marginPH = Proportion of retailer to whom Hippo provide them with highest margin Thesignificance level (a) is 0.05. According to the Kruskal-Wallis test, the p-value is as low aszero, so we reject the null hypothesis. So we see that at the a = 0.05 level of significance,there exists enough evidence to conclude that there is significant difference among the threesnack brand in terms of the margin/profit provided to the retailer.

8. Factor Analysis: The main applications of factor analytic te (1) To reduce the number ofvariables and (2) To detect structure in the relationships bet Therefore, factor analysis isapplied as a dat The variables taken are: .Supply Quality of Hippo as r .Quality of Product

delivered as r .Quality of service(Replacement .Merchandize offered and its a .Marginperceived by the samples .Quality of Hippo as responded by Samples or analytic techniques


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are: the number of variables and tionships between variables, that is to classify sis is appliedas a data reduction or structure detection method. Supply Quality of Hippo as responded bySamples ed as responded by Samples placement and Adjustment) as responded by Samplesand its availability as responded by Samples ed by the samples sponded by Samples classifyvariables. tion method. y Samples The main applications of factor analytic te (1) To reduce

the number of variables and (2) To detect structure in the relationships bet Therefore, factoranalysis is applied as a dat The variables taken are: .Supply Quality of Hippo as r .Quality ofProduct delivered as r .Quality of service(Replacement .Merchandize offered and its a.Margin perceived by the samples .Quality of Hippo as responded by Samples or analytictechniques are: the number of variables and tionships between variables, that is to classify sisis applied as a data reduction or structure detection method. Supply Quality of Hippo asresponded by Samples ed as responded by Samples placement and Adjustment) as respondedby Samples and its availability as responded by Samples ed by the samples sponded bySamples classify variables. tion method. y Samples

From the component plot above it is quite clear that plot above it is quite clear that quality of

product, quality of supply and replacement and adjustment constitute one factor while marginof hippo and merchandizing provided constitute the other factor. From the Scree Plot it canbe seen that 2 components have Eigen Value more than 1 and they can explain 74.09% of thevariation.

Part 1 (b) Area wise analysis of the attributes 1. Demand hippo vs Area 70%, 55%, 50% inLake Town, Shyambazar, Ultadanga respectively consider the demand of Hippo to be low.72.7% of sample in Salt Lake and 50% of sample in New Market feels the demand for Hippois average. However 44.4%, 50%, 41.7% of the sample in Nagerbazar, Baisakhi andUltadanga respectively fell the demand is high over there.

2. Flavour vs area Goan Butter and Garlic flavour is the most liked flavour in Salt Lake.While Punjab Da Pickle is the favourite in Nagerbazar. All the other area has no definitefavourite.

3. Area vs Hippo Stocked Cross tabulation Area * Hippo Stocked Cross tabulation HippoStocked No Yes Previously Kept Area Salt Lake Count 0 12 0 % within Area .0% 100.0%.0% Lake Town Count 4 3 4 % within Area 36.4% 27.3% 36.4% Nagerbazar Count 2 10 0 %within Area 16.7% 83.3% .0% Baisakhi & CK Market Count 3 1 5 % within Area 33.3%11.1% 55.6% New Market & Hogg Market Count 11 0 6 % within Area 64.7% .0% 35.3%Ultadanga, Murari Pukur, Kankurgachi & Bagmari Count 13 5 7 % within Area 52.0% 20.0%

28.0% Beadon Road, Aurobindo Road & Vivekananda Road Count 13 10 5 % within Area46.4% 35.7% 17.9% Shyambazar, Baghbazar & Rajballav Para Count 4 13 7 % within Area16.7% 54.2% 29.2% Total Count 50 54 34 % within Area 36.2% 39.1% 24.6% From thecross tabulation above, we see that the penetration of Hippo is excellent in Salt Lake andNagerbazar area and good in Shyambazar area. However, the performance is very dull inother areas with only 18.82% (mean) sample who keeps Hippo.

Reason for not keeping Hippo vs Area Important Findings: Only the shops that does not keepHippo or use to keep Hippo has been considered.

44% of the shops in Beadon Street area, 28% of shops in Ultadanga area and 24% of shops in

New Market area were never approached.


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40% of the shops in New Market area and Ultadanga area do not keep Hippo due to lack ofspace. As both the areas are prime location for sale, competitors brand flood their product into the shops in these areas leaving no shelve space for Hippo. The retailer find it lucrative tostore competitors brand in the limited shelve space since the sale of the competitor brand ishigh.

30% of the retailer in the Baisakhi area complained about the sudden stoppage in supply ofHippo. During the survey we heard of a rumour that a sales representative masterminded ascam worth Rs 18 lac so the supply was stopped for some couple of months. 20% of theshops in Shyambazar also reported of the halt in supply

40% of shops in Shyambazar area and Beadon Street area do not keep Hippo anymore due tolow sales and about 20% of shops in Lake Town area due to the same.

40% of the shops in Lake Town area do not keep Hippo anymore due to low sales.

57.1% of the shops in Lake Town do not keep Hippo because of low demand from thecustomer. They said that nobody asks for Hippo so he does not find it feasible to keep it.Most of the retailers have a preconceived notion that if there is no demand, the product wontsell. They are ignorant of demand creation and demand marketing.

50% of the shop in New Market and 37.5% of the shops in Ultadanga area reported that theywere not being followed by the sales representative.

The chi-square test proved the above test to be statistically significant

4. Area vs Frequency of order Important Finding: 46.7% of the sample collected from beadonroad area orders in a monthly basis. 25% of the sample collected from shyambazar area has areorder period of fortnight. All the test areas survey mostly has a reorder period of about aweek with a very low standard deviation of 0.946 which is quite low. 20% of the samplescollected from shyambazar area orders twice a week.

Satisfaction Score of sample among different area: We have devised an algorithm to providea score to different market. We have considered five different attributes for it. The attributesare:

Supply Quality of Hippo as responded by Samples

Quality of Product delivered as responded by Samples

Quality of service(Replacement and Adjustment) as responded by Samples

Merchandize offered and its availability as responded by Samples

Margin perceived by the samples The score is obtained from the crosstab (Area x 5 attributementioned above). All the major data are recorded and is assigned a score on 5. For example:if most of the samples in Salt Lake are extremely satisfied with the supply quality, then SaltLake scores 5 on 5 in terms of Quality of Supply whereas if, most of the samples in Salt Lake

are extremely dissatisfied with the merchandize offered then Salt Lake scores 1 on 5. If thereis a tie, then an average is taken. For example, if 33.3% of the samples in Ultadanga area are


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both extremely satisfied and dissatisfied then the score is, 5 for extremely satisfied plus 2 fordissatisfied divided by 2 i.e 3.5. Extremely satisfied =5, Dissatisfied =2 so that makes(5+2)/2=3.5. A table has been generated after each cross tab provided below which willdisplay the score of the area according to the different area.

5. Area vs Quality of Supply: 33.3% of the samples collected from Ultadanga area areextremely dissatisfied with the supply quality while 33.3% of the samples collected from newmarket area are dissatisfied with the supply quality. However 66.7% sample in Baisakhi areasatisfied followed by Salt Lake, Nagerbazar and Shyambazar with 77.2%, 100% and 50% ofthe sample being extremely satisfied.

Area Score Salt Lake 5 Lake Town 4 Nagerbazar 5 Baisakhi 4 New Market 2 Ultadanga area2.5 Beadon Road area 5 Shyambazar area 5

6. Quality of product supplied vs Area: 33.3% of the samples collected from Ultadanga areaare extremely dissatisfied with the supply quality while 33.3% of the samples collected from

new market area are dissatisfied with the supply quality. However 66.7% sample in Baisakhiarea satisfied followed by Salt Lake, Nagerbazar and Shyambazar with 66.7%, 87.5% and50% of the sample being extremely satisfied.

Area Score Salt Lake 5 Lake Town 4.5 Nagerbazar 5 Baisakhi 4 New Market 2 Ultadangaarea 2.5 Beadon Road area 5 Shyambazar area 5 7. Replacement vs Area:

33.3% of the samples collected from Ultadanga area are extremely dissatisfied with thesupply quality while 33.3% of the samples collected from new market area are dissatisfiedwith the supply quality. However 66.7% sample in Baisakhi area satisfied followed by SaltLake, Nagerbazar and Shyambazar with 80%, 87.5% and 60% of the sample being extremelysatisfied. Area Score Salt Lake 5 Lake Town 5 Nagerbazar 5 Baisakhi 4 New Market 2Ultadanga area 2.5 Beadon Road area 4.5 Shyambazar area 5

8. Merchandising vs Area 100% of the sample collected from Lake Town, Nagerbazar,Baisaki, New Market, Ultadanga area is extremely dissatisfied with merchandizing. 86.7%samples in the Beadon Road area are dissatisfied. However 18.2% of the sample in Salt Lakearea is area is satisfied while another 18.2% extremely satisfied.

Area Score Salt Lake 1 Lake Town 1 Nagerbazar 1 Baisakhi 1 New Market 1 Ultadanga area1 Beadon Road area 1 Shyambazar area 2 9. Margin hippo vs Area

0% of the shop perceives that the margin offered by Hippo is poor. 44.4% of the sample inShyambazar area perceives the margin offered being fair while 100% of the sample fromLake Town, Nagebazar feels that the margin offered by Hippo is good. In Baisaki and NewMarket area, 83.3% of the samples feel good about the margin offered by Hippo. 81.8% ofthe sample in Ultadanga considers the margin to be good. 5.6% of Shyambazar sampleconsider it to be very good. 18.2% of Salt Lake and 16.7% of Baisakhi perceives the marginto be excellent. Area Score Salt Lake 3 Lake Town 3 Nagerbazar 3 Baisakhi 3 New Market 3Ultadanga area 3 Beadon Road area 3 Shyambazar area 3

Conclusion: Area Salt Lake Lake Town Nagerbazar Baisakhi New Market Ultadanga Area

Beadon Road Area Shyambazar area Quality of Supply 5 5 4 4.5 5 5 4 4 2 2 2.5 2.5 5 5 5 5Out of 5 Out of 5 Quality of Product Supplied Replaceme nt and Adjustmen t 5 1 5 1 5 1 4 1


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2 1 2.5 1 4.5 1 5 2 Out of 5 Out of 5 Merchandize offered and its availability Marginperceived 3 3 3 3 3 3 3 3 Out of 5 Total 19 17.5 19 16 10 11.5 18.5 20 Out of 25 From thescore we understand that the satisfaction level among retailer in Syambazar market is mostfollowed by Salt Lake and Nagerbazar. Much work is to be done in New Market andUltadanga area.

Part II (a): Competitor Analysis from the eyes of the consumer This study is divided intothree sub-parts:

The first sub-part deals with demography of the sample.

The second sub-part deals with a general study about sample's preferences and factors

The third sub-part deals with study of sample's attitude towards Hippo DEMOGRAPHYMost of the sample belonged to the age bar of 21 to 30yrs. Since packaged snacks are morepopular among this age category, more data has been collected from this age segment. 51.2%

of the samples are graduate while 36.4% are postgraduate, so the chance of getting informedconsumer is more.

60.5% of the sample are male while 39.5% of the sample are female. 50% of the sample hasannual income less than Rs 1.5 lac. 83% of the sample belong to nuclear type family whilethe 17% belong to joint type of family.

Part II(b) -General preference and attitude of the sample This sub-part studies about thegeneral preference and attitude of the sample. It aims to find out the most important factorthat consumer look for before making a buying decision. The survey was conducted onlythrough questionnaire method. The table below shows what percentage of the sample mostlylike which brand of snack.

Brand % of sample Rank Lay's 59.70% 1 ITC Bingo 10.10% 3 Kurkure 13.20% 2 LocalChips and Chanachur 2.30% 5 Cheetos 1.60% 6 Uncle Chips 6.20% 4 Haldiram's 2.30% 5 P& G Pringle 1.60% 6 Britannia 0.80% 7 Parle Biscuit 0.80% 7 Hippo 1.60% 6 Total 100.00%From the above table and the graph it is very clear that Lay's is the most popular and isfavourite for 59.70% of the sample while Hippo is favourite for only 1.60% of the sample.

More about the competitive brands LAYS from Fritolay Lays from Fritolay is a groupcompany of Pepsico India is the only money making machine for this global giant in India.

Indian snack food business is a huge market to the tune of 17000tonnes out of which thebranded foods contribute around 6500 tonne. In revenue terms, Indian snack food business isworth around Rs 65000 crore and growing. Lays commands a monopoly sort of position inthe Potato chips category which is around 77% of the snack food market. Lays is competinghead on with the unbranded players in the market and if you look at the broader levels ofcompetition, this brand is competing even with the snacks from its own kitchen. It isinteresting to see how this brand has succeeded in the commodity business. It followed all therules to perfection. 1. Quality: the brand offered superior quality compared to the otherunbranded snacks there by reducing the risk to the customer. The crisp and beautifullypacked chips were a new experience for the Indian consumer. 2. Value addition: the brandoffers unimaginable range of potato chips with many flavours made especially for India.

Together with many new international flavours, it easily caught the imagination of Indianconsumer 3. Aggressive brand building: Lays spent lot of money on brands building and once


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established were able to charge a premium for the brand. Although initially Indian consumerswere unsatisfied by the high price, slowly the brand established its credentials. The so called"Liberation child' and the software yuppies caught hold of this brand. These trend settersmade this brand a must for looking cool in campuses. Lays with Cola" began to take its tollon "Samosa and Tea".

Lays lavishly spent money on brand building. The ads were catchy and were positioning theproduct on the platform of "Taste" .The baseline ' No one can eat just one is one of the mostsuccessful baseline in Indian advertising. The baseline is true also since the taste iscompelling that no one can eat just one. The brand ambassadors Saif and Priety gave a coolattitude to this brand making it more interesting for the new generation. Lays have alwaystried to excite its fans by launching new flavours frequently. This ensured that the brand isnever boring. The laflavourlavor is the Latino style. The company is going to focus on Musicas a base for building this brand. With ITC foraying into this business will see the marketexpanding. But Lays have put itself in a formidable position that is difficult to match. ITCBINGO Bingo is ITC's challenge to the monopoly of Frito Lays. ITC launched Bingo in the

highly fragmented Rs 4500-5000 crore ($1 Billion) snack fomarket. Indian snack food marketis dominated by unorganised sector. The organised snack foods market is only Rs 2000 croreand is dominated by the iconic Lays brand with over 77% market share. Having tastedsuccess in Biscuits, staples and Ready to eat market, Bingo will be another test for ITC'smarketing muscle. It fights in this segment with none other than Pepsi. Indian snack foodmarket is divided into: Traditional Snacks ( bhujiya, Chanachur etc) Western Snacks and thenewly created Finger snacks segments. Bingo is entered both the potato and finger snacksmarket. According to the company press release, Bingo comes in 16 flavours. Its potato snackhas 4 innovative variants taking into consideration the taste difference across Indian market.The Finger snacks line has six variants. The TVC's are now on air and the company intendsto position this brand as a fun brand targeting at the youth. The brand tries to differentiatefrom Lays by focusing on innovation (in flavours). Snack foods : because of the low financialrisk (low price) for the customer, new tastes will be a key in marketing success. Layssucceeded by offering great quality, variety and brand to reach the leadership position. Bingoit seems is following the leader.

The task is very tough for ITC to fight with Lays. The golden line is that the market is solarge that every player will have a space provided, the brand keeps the promise. The highprofile brand launch of Bingo will see the market expanding thus benefiting all the players .ITC is aiming at a 360 degree brand building effort to boost the new launch. The brand takesthe tagline: No Confusion Great Combination. The brand is promoted through a series of

funny ad which I feel is little too complicated. The ad tries to be funny but fails to make theaudience laugh. The poor execution can create problems for the brand.

Five different attributes have been considered:

Taste

Value for money

Availability

Health Factor


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Promotion The aim is to find out which component influences the most in choosing thefavourite brand among the sample studied. We would compare each brand of snack with eachattribute and rank the brand accordingly. The ranking would be based on a score. Algorithmto calculate the score: The crosstab generates the count and percentage of the sample of theirsatisfaction level with regard to their favourite brand. Each satisfaction level carries weight

i.e.

Extremely Satisfied(ES) = 5

Satisfied(S) = 4

Neutral(N) = 3

Dissatisfied(D) = 2

Extremely Dissatisfied(ED) = 1 The percentage of the sample is multiplied with the weights

and added accordingly to get the desired score. An example will make the algorithm lookmuch clearer. Suppose, of the whole sample who considered Lay's to be their favourite, 9.1%are extremely dissatisfied(ED), 23.4% are dissatisfied(D) , 35.1% are neutral(N), 26% aresatisfied(S) and 6.5% are extremely satisfied(ES) with the value for money. The score iscalculated as shown below: 9.1*ED+23.4*D+35.1*N+26*S+6.5*ES= 6558.5

So we conclude that Lay's has scored 6558.5 on value for money. Since it is a weightedprocess, percentage of score is of less relevance. However it can be compared with the scoreof other brands within the same attribute. The choice of favourite brand was an open-endedquestion in the questionnaire but we have sorted out 11 distinct brands namely: Lay's, ITCBingo, Kurkure, Cheetos, Uncle Chips, Haldiram's, P & G Pringle, Britannia Biscuit, ParleBiscuit, Local Chips n Chanachur and Hippo but we have accounted only those brand whoare favourite of more than or equal to 5 samples. This includes: Lay's, ITC Bingo, Kurkureand Uncle Chips 1. Brand vs Taste Brand Extremely Dissatisfied Dissatisfied NeutralSatisfied Extremely Satisfied Score Lay's 0 1.3 5.2 49.4 44.2 436.8 ITC Bingo 0 0 0 76.923.1 423.1 Kurkure 0 5.9 11.8 41.2 41.2 418 Uncle Chips 0 0 0 75 25 425 2. Brand vs Valuefor money Brand Extremely Dissatisfied Dissatisfied Neutral Satisfied Extremely SatisfiedScore Lay's 9.1 23.4 35.1 26 6.5 297.7 ITC Bingo 7.7 23.1 46.2 23.1 0 284.9 Kurkure 5.917.6 23.5 41.2 11.8 335.4 Uncle Chips 0 25 25 50 0 325

3. Brand vs Availability Brand Extremely Dissatisfied Dissatisfied Neutral Satisfied

Extremely Satisfied Score Lay's 0 1.3 2.6 41.6 54.5 449.3 ITC Bingo 0 7.7 23.1 23.1 46.2408.1 Kurkure 0 0 11.8 52.9 35.3 423.5 Uncle Chips 25 12.5 25 12.5 25 300 4. Brand vsHealth Factor Brand Extremely Dissatisfied Dissatisfied Neutral Satisfied ExtremelySatisfied Score Lay's 5.2 22.1 46.8 23.4 2.6 296.4 ITC Bingo 0 23.1 38.5 38.5 0 315.7Kurkure 5.9 17.6 58.5 17.6 0 287 Uncle Chips 0 12.5 75 12.5 0 300

5. Brand vs Promotion Brand Extremely Dissatisfied Dissatisfied Neutral Satisfied ExtremelySatisfied Score Lay's 0 1.3 9.1 44.2 45.5 434.2 ITC Bingo 0 7.7 30.8 38.5 23.1 377.3 Kurkure0 0 17.6 41.2 41.2 423.6 Uncle Chips 25 12.5 25 25 12.5 287.5 Conclusion: Brand TasteValue for money Availability Health Factor Promotion Holistic Score Lay's 436.8* 297.7449.3* 296.4 434.2* 1914.4 ITC Bingo 423.1 284.9 408.1 315.7* 377.3 1809.1 Kurkure 418

335.4* 423.5 287 423.6 1887.5 Uncle Chips 425 325 300 300 287.5 1437.5 Lay's KurkureLay's ITC Bingo Lay's *-Highest in the category.


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Rank Rank based on popularity Rank based on the study of five different attribute BrandBrand Lay's Kurkure ITC Bingo Uncle Chips Lay's Kurkure ITC Bingo Uncle Chips Therank based on the five attributes turns out to be exactly the same as of the rank, based onpopularity. So we can say the popularity depends on the five factors mentioned above. Thereason of popularity could be gauged approximately from the score calculated above. Lay's is

best because most of the sample studied finds the taste to be excellent, it has a very gooddistribution network (availability) and performs good promotional activity while Kurkure issecond best because it offers high value for money. ITC Bingo is third best becauserespondent perceives ITC Bingo to be relatively healthy snack.

6. Factor Analysis: Factor Analysis reduces the dimensionality(i.e. no of variables) of a dataset by clubbing groups of variable as factors. The variables chosen were the same i.e.

Taste

Value for money

Availability

Health Factor

Promotion Two component with eigen value more than 1 could be identified as shown in thescree plot below.

Component 1 alone explains 35.99% of total variation while 27.63% of variation is explainedby component 2. We can identify the variables that has higher loading toward each factors byploting a loading plot. So from the loading plot/component plot we see it clearly that thevariable Promotion and Availability has high factor loading towards factor 1 while thevariable Value for money, Taste and Health factor can be clubbed into factor 2. From theFactor Analysis we get a hint that, there might exist some positive correlation betweenpromotion and availability. A correlation matrix would further clarify.

The above correlation matrix shows that promotion and availability has considerable positivecorrelation. So we may say that there exist enough evidence to believe that availabilityincreases with greater promotion. Conclusion

Lay's is favourite for most of the respondent followed by Kurkure and ITC Bingo

Lay's is successful because of great taste, good promotion and efficient distributionchannel(availability).

Kurkure has the most value for money quotient while ITC Bingo has the highest healthquotient.

The five attributes i.e. taste, availability, promotion, health factor and value for money can beclubbed into two factors. Factor I constitutes availability and promotion while health factor,value for money and taste can be clubbed into factor 2.

There exists relatively positive correlation between promotion and availability (corr=0.650)i.e. with more availability increases with more promotion.


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Part II(c): Analysis of Hippo with all other attributes Note: Some of the frequencies providedbelow may add up to more than 100% since the question type was multiple choice question,one respondent may choose more than one choice provided. Those are marked as MCQ* inthe right hand bottom corner of the cell. Frequencies considering the whole sample.Awareness 79% of the sample are aware of Hippo while the rest are unaware about it Source

of awareness TV Commercial is one of the many sources of awareness for 73% of therespondent. It is the most effective one. Presence marketing is also one of the key componentof awareness (MCQ*)

Source of procurement 59% of the respondent bought Hippo from Local Retail Shops. While34% of the respondent bought it from other retail shop. (MCQ*) Recall 27.1% of therespondent could recall the brand Hippo while 72.9% could not recall. So we can say thatbrand salience is low. % tried Hippo Among the respondent who are aware of Hippo, only44.7% of the respondent tried Hippo others did not.

No of packs Most of the respondent who tried Hippo had 1 or 2 pack of Hippo a month

before the survey and a large proportion did not had a single pack last month. SKU Most ofthe respondent who tried Hippo a month before the survey had tried the medium pack ofHippo. (MCQ*)

Occasion Most of the respondent who tried Hippo a month before the survey had Hippo onlyfor snacking. (MCQ*) Product Knowledge 65.6% of the respondent did not know that Hippois baked but not fried with no cholesterol, no mono sodium-glutamate and trans fat.Likeliness for the name-Hippo 44.2% of the respondent did not like the name Hippo. Somerespondent wrote that Hippos are associated with obesity, so they feel that the name Hippomay not be very correct. However majority of the respondent likes the name. %of therespondent who would recommend Hippo

45.2% are neutral about recommending the brand to their acquaintances while 21.4% arelikely to recommend. Most tried flavour Most liked flavour

Frequencies considering the conditions: 1. Awareness vs Recall Of the 72.9% awarerespondent, 27.1% of the respondent could recall the brand Hippo. So we can say that thebrand salience is very low. Brand salience and recall is dependent on the promotionalcampaign. Let us calculate the attribute score like we have calculated before in Part II(b) i.e.percentage of the sample according to the attribute, multiplied by attributes weight.

Our hypothesis is that the score on promotion will be low. 2. Hippo vs Taste The score ofHippo with regard to taste is (26.2*2)+(52.4*3)+(14.3*4)+(7.1*5) = 302.3. The score ofHippo with regard to value for money is (14.3*2)+(59.5*3)+(21.4*4)+(4.8*5) =

The score of Hippo with regard to availability is (7.1*1)+(42.9*2)+(35.7*3)+(9.5*4)+(4.8*5)= 262 The score of Hippo with regard to Health factor is(2.4*1)+(2.4*2)+(50*3)+(33.3*4)+(11.9*5) = 349.9

The score of Hippo with regard to promotion is (9.5*1)+ (52.4*2)+ (21.4*3)+ (7.1*4)+(9.5*5) = 254.4 Hippo Score Taste 302.3 Value for money 316.7 Availability 262 HealthFactor 349.9 Promotion 254.4 Hippo scores highest in the health factor segment and lowest in

promotion. Our hypothesis that the score for promotion will be low is true and is evident inthe table above.


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Comparison of Hippo vs Lay's according to the five attributes: Attribute Score of Lay's Scoreof Hippo Difference % of difference Taste 436.8 302.3 134.5 -30.79% Value for money297.7 316.7 16 +6.38% Availability 449.3 262 187.3 -41.68% Health Factor 296.4 349.9 53.5+18.04% Promotion 434.2 254.4 179.8 -41.41% From the comparison of Hippo with themarket leader, we get Hippo though a new entrant in the market has already beat Lay's in two

attributes i.e. value for money and health factor but Hippo has to engage a lot in promotionand has to develop better taste to catch up with the market leader. The % of difference inpromotion and availability are very close, so from here, we again get a hint that there may liea positive correlation. Lets find out.

The correlation between Availability and Promotion is 0.546. It is positive but not verystrong. However since the relationship is positive, availability would increase if promotion isdone more. 3. Factor Analysis: The variables chosen are the same the exception being theproduct is only Hippo. The variables are:

Taste

Value for money

Availability

Health Factor

Promotion

Two component with Eigen value more than 1 could be identified as shown in the table

below and it's plot above. Component 1 alone explains 47.710% of the variation whilecomponent 2 explains 24.114% of variation. Both factor 1 and factor 2 explains 71.824% ofvariation. We can identify the variables that has higher loading toward each factors byplotting a loading plot. From the component plot it is clear that taste, availability andpromotion constitute to factor 1 and value for money and health factor constitute to factor 2.Now going back to the attributes scores, factor 1 has the entire variable that needs to beimproved, for Hippo to be an established strong brand in the market.

Parle Hippo: Marketing Mix PRODUCT: Hippo is a toasted bread snack. Its ingredientsinclude wheat flour, edible vegetable oils, seasoning mix, corn starch, sugar, raising agent,milk solids, salt, emulsifier, yeast extract powder, instant yeast. It contains added natural

color and added natural identical flavoring substances; but no added MSG, no GMO and noTrans Fat. Nutritional Information (Approx) Per 100g Energy (Kcal) 497 Protein (g) 7.0Total dietary fibre (g) 2.0 Total carbohydrate (g) 60 Sugar (g) 4.0 Total fat (g) 26 Saturatedfatty acids (g) 17 Monosaturated fatty acids (g) 6.0 Polysaturated fatty acids (g) 2.0 Hippowas launched as a new baked wheat snack by Parle Agro. The snack aimed to bridge the gapof health and taste in the branded snack market. With Hippo, Parle agro aimed to diversifyfurther by adding snacks to their portfolio Hippo has been launched in two stages: HippoMunchies was launched in the first stage in six different flavours:

Italian pizza

Chinese Manchurian


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Hot-n-sweet tomato

Thai Chilli

Yoghurt mint chutney

Indian Chatpatta

In the second stage, Parle Agro has extended its snacks range, Hippo, by introducing the firstever wheat-based, round-shaped snack called Hippo Round-Round in five distinct flavours.

Shillong Noodle Masala

Punjab da Pickle

Gujarati Mango Chutney

Goan Butter Garlic

Firangi Cheese n Spice PLACE (DISTRIBUTION): The company concentrates on 4 areas fordistribution

Retail Trade: In India small store format is still the king. Given the performance and potentialof the India retail market; it continues to be top priority for Parle Agro, like most FMCGcompanies.

Modern Trade: Modern Trade is expanding rapidly. International & Domestic / Regionalplayers are driving this trend to take advantage of the change in shoppers buying behaviour.

Hotels, Restaurants and Cafes: This segment is to cater to the needs of the consumers whovisit a hotel or a restaurant.

Institutions: The segment mainly concentrates on the distribution of the product to institutionslike schools colleges, corporate campuses. Hippo turned to social media in order to reinforceits sales and distribution network. In February 2010, Hippo asked his Twitter followers send atweet whenever they couldnt find Hippo in stores and promised to replenish stocks withinhours. Hippo was therefore able to identify empty racks faster and re-stock locations within

hours, even identify new potential markets. The resulting response prompted Parle Agro toset up a core cell which instantly passes the information received as tweets to the respectivearea sales and distribution teams. Hippo received stock update Tweets from over 25 cities. Atzero cost, the number of people tracking stocks across markets over Twitter for Hippo wasequivalent to 45% of its sales team.

By matching supply with demand more effectively, Hippo managed to up its sales by 76% inthe first few months after launch. The campaign helped Hippo to identify, gauge demand andprioritise its potential new markets . Hippo effectively used social media to do what no onehas ever done before -reinforce and support its sales and distribution network. PRICE Theproduct is available at 3 price bands namely, 5, 10 and 20 Rs. The company gives consumer

promotional offers on its product. As an introductory offer, two packets of 10\-Rs Hippocosts 16\-Rs. Other offers on Hippo include, Buy two 20\-Rs packs and get a 200ml Frooti


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free. The product is priced very competitively. Pricing is the key, as a lot of entrants areeyeing a stake in the health snacks segment. Most brands are in the price band of Rs 5 to 10,with Aliva being the exception at Rs 12. PROMOTION

Commercials: The brand chose a different way to communicating its positioning to the

consumer by trying to tell a story. The story is based on the premise that Hunger is the rootcause of all evil. So the brand motto is fight hunger, fight evil. The brand has adopted themascot Hippo who is in the forefront of eliminating hunger and thus eliminating evil. Hippohas the tagline "Hippo Fights Hunger ".

Television: The TVC is seen through the hippo's (brand mascot) view as he goes to everyscene of crime, war or conflict, offering each of the involved parties some Hippo chips.Everybody happily obliges and takes a bite, and this is shown to resolve all issues. As theseries continues, the voiceover goes on to say that the root cause of all evil in the world ishunger. "So please, dont be hungry," it appeals. The song Pyaar baat te chalo (Keepspreading the love) which doubles up as the background music, plays a pivotal role in helping

the TVC communicate its message.

Radio Jingles: The hippo radio jingles are based on the same concept as the TVC i.e. fighthunger, fight evil. They mock English translations of fictional speeches by Hitler, SaddamHussain and Stalin where they admit that they are famished and hence their wrath willdescend on the world. So Hippo reiterates Dont go hungry.

Social Media: Parle Agro has successfully launched a unique marketing initiative on Twitterin February this year, to push Hippo sales. While the initiative aimed to sharpen Hipposdistribution, it was also directed at speeding up awareness, top of mind recall and demandfrom consumers. Hippo chips interactive website emphasises the fun element of the brand.The website is very well made and opens up in different flavour colours every time. It hassections on consumer feedback, Hippo history, consumer polls and exciting games. Thewebsite is specifically directed to engage young consumers by making it snazzy and colourfulwith interesting twists in language and imagery. The website also has links to the TVC videoand radio jingles.

Parle Hippo: S.W.O.T Analysis

STRENGHTHS

Hippo is product of a well known brand Parle Agro

Hippo is a low calorie, baked snack made from wheat and free of MSG & GMO and thus itproves to be a healthy snack

The product is targeted at any person who is hungry

Hippo has a rather amusing communication strategy created by Creativeland Asia: 'FightHunger, Fight Evil'. If hunger is the root to all evil, we must all rise up and fight the cause

Hippo chips have been launched in a huge number of variants. The flavours vary from Pizza

flavour to Chinese Manchurian to Indian chatpatta. They cater to a vast variety of taste buds,


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where everyone can find something to satisfy his/her taste buds. The variants in which Hippois found caters to both international and national, regional tastes

The pricing of Hippo chips is very competent

Hippo draws a good balance between price and quantity offered

WEAKNESS

Hippo chips have not been very successful in making a dent in the market or in the mind ofthe Indian consumer

Brand awareness, recall and popularity of Hippo is very low

Availability of Hippo is also very low

Marketing strategies of Hippo has been up to the mark and the brand has not been able toinfluence its target customers. The impact of promotions offered by Hippo has made nosignificant effect in the minds of the consumers

Positioning of Hippo has been confusing, as the exact growth strategy of Hippo cannot beunderstood. If judged by the Ansoff Matrix it is not clear whether Hippo follows the strategyof Diversification (new market, new product) or the strategy of Product Development (newproduct, existing market).

OPPORTUNITIES

Rising income levels and changing consumption patterns which more demand and largemarket

Favourable demographic profile and changing lifestyles who are prone to eat more of ready-to-eat packaged snacks

It has the opportunity to improve its availability by filling up the gaps in the supply chain

Hippo has the opportunity of positioning itself as a healthy snack brand which can turn out tobe its differentiating factor from other brands rather than positioning it to be a hunger killer

Hippo has the opportunity of making strong images in the minds of the target customers byaggressive and effective marketing strategies both Below the Line and Above the LneTHREATS

Affordability and cultural preferences of fresh food

Huge number of substitutes both at local and national level

High packaging and promotion cost

Competition with big strong brands


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Hippo: Product Life Cycle Product life cycle consists of 4 stages namely:

Introduction stage

Growth Stage

Maturity Stage

Saturation and decline stage Parle Hippo is in the first stage of product life cycle i.e. theIntroduction stage. The introduction stage of Parle Hippo has beens characterized by: Highcost: Initially Hippo was procured from the factory in Maharashtra that incurred additionaltransportation cost. Even the merchandizes were brought from Maharashtra. The factory thatwas proposed to be set up in Barasat for manufacturing of Hippo in order to cater the EastIndia market has already started making Hippo and supplying them to the North Kolkatamarket and other areas in East India presently, but the merchandizes still comes fromMaharashtra. As it is a newly set factory, it has not reached its break-even point and is yet to

achieve economies of scale and thus costs incurred by the company are still remaining high.

Low sales volume:

Since sales is a function of demand, depends on the rate at which Hippo is demanded andconsumed by the customers. Demand and preference for Hippo is found to be quite low in theNorth Kolkata market. Other snack brands like Lays, Kurkure, Bingo etc are preferred moreover Hippo in the market thus leading to low sales of the product. Hippo has not yet beenable to make a strong impression in the minds of the consumers so is initiating a low saleturnover

High demand creation

Since parle hippo is a new product, the company has been using both push and pull strategiesto generate high demand for the product. Both Above the Line and Below the Line strategieshave been applied in order to promote the product. Aggressive campaigning has been donethrough TV commercials which are instrumental in generation of demand

Hippo: Suggestions

An excellent customer connect through a 360 degree communication approach should be

undertaken by Hippo in order to enjoy brand recall & brand salience in the snacks category

Hippo should try to increase its brand visibility by strengthening its distribution network. Itcan focus on unconventional retail points like cyber cafes and telephone booths, in order toincrease brand visibility and product reach

As per the experience with the North Kolkata market, it has been seen that there is noconsistency in the tenure of distributors. Distributors are changed frequently which in turn ishampering relationship with the retailers. A good consistent relationship should exist betweenthe company and the retails in order to sell the product which can only happen if their liesconsistency in the tenure of distributors


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Vehicles used to supply the product to the various selling points should contain the name ofthe brand i.e. hippo on it so that all in the sales and distribution network and as well as targetcustomers can become aware of the product being distributed. Hippo should provide itsretailers with separate racks, shelves, baskets, almirahs etc in order to stock Hippo withsafety. This can increase the brand visibility of the products. Since most of the shelves are

filled by the competitor brands, retailers find it difficult to stock Hippo and so supply ofadditional shelves will also boost the demand for the product among the retailers Since thebargaining power of Hippo low, the scope of credit transactions should be widened Uniqueretailer scheme should be provided which would comprise incentives to the retailers not onlyin cash but also in kind

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