1. A comparative study on fruit juices
Market research
By
ASHISH KUMAR KESHRI
(PGD08017)
Institute Of Management Studies,
Noida
2010
2. Institute of Management Studies, NOIDA
A
Project Report on
Comparative Study on fruit juices
As a partial fulfillment for the award of PGDM Degree
under
AICTE (2008 - 2010)
Submitted to: Submitted by:
MRS. SONIKA SHARMA ASHISH KUMAR KESHRI
PGD08017
2
3. To Whom It May Concern
This is to certify that Mr. ASHISH KUMAR KESHRI Roll Number PGD08017 of PGDM
6th term is a bonafide regular student of this institute for the session 2008 – 2010.
He/ She have completed the project report titled “A Comparative Study on
Fruit Juices” under my supervision, as a part of partial fulfillment for the award of
PGDM Degree under AICTE. His/ Her report is satisfactory and not copied from
anywhere to the best of my knowledge.
Date:
Signature
Project Supervisor
3
4. ACKNOWLEDGEMENT
A work is never a work of an individual. We owe a sense of gratitude to the intelligence
and co-operation of those people who had been so easy to let us understand what we
needed from time to time for completion of this exclusive project.
I want to express my special gratitude towards Mrs. Sonika sharma lecturer, IMS,
noida for helping me in completion of my project.
Last but not the least, I would like to forward our gratitude to all the people who always
endured me and stood by me and without whom I could not have envisaged the
completion of my project.
Contents
1. INTRODUCTION ………............................................................... 8 to 39
1.1 General Introduction
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5. 1.2 Objectives and scope of the Project
1.3 use and importance of the study
1.4 marketing research
2. RESEARCH METHODOLOGY …………………………………… 40 to 43
3. PROFILE OF THE ORGANISATION:
“Surya Foods & Agro Ltd”. …………………………………………. 44 to 51
4. RESEARCH ANALYSIS……………………………………………. 52 to 62
4.1 Consumer awareness for fruit juices.
4.2 Consumer demand for fruit juices
4.3 Consumer demographic profile and preference for fruit juices
4.4 Consumer preferred brand
4.5 Consumer preference for packaging
4.6 Awareness regarding the fresh gold
4.7 Competitors market share
4.8 Most popular flavor
4.9 Purchasing capacity of consumer
4.10 Juice variety
4.11 Consumer concern regarding features
5. CONCLUSION……………………………………………………….. 63 to 65
6. RECOMMENDATIONS…………………………………………… .. 66 to 68
7. APPENDIX…………………………………………………………… 69 to 71
A) Questionnaire Sample
B) Bibliography
EXECUTIVE SUMMARY
5
6. The whole study or research explains about the consumer’s buying behavior and their
preferences regarding fruit juices. For this five brands were taken into consideration
Real, Real Active, Saint, Tropicana and Fresh Gold. Basically the emphasis was given
to the Fresh Gold. In this research I tried to know the perception regarding the Fresh
Gold juice.
Consumer buying behavior is a generic term explains about the consumer choice or
preference that they have for a particular product. Consumer’s buying behavior tells the
companies about the modifications or features of the products. For this research some
of the main features were taken into consideration like flavor, availability, price,
packaging and the most important “awareness”. Because during research I came to
know that there are so many people who even don’t know about the Fresh Gold that
there is such kind of fruit juice available in the market. So I tried to focus on the
awareness of the consumers. After this there are so many competitors in the market like
Real, Tropicana etc. but the competition become tougher when we talk about the local
juice makers and sellers.
The consumer gets confuse when he has got the more options at an affordable price in
respect of quality, availability, packaging etc. and choose the product in which he feels
the maximum satisfaction or the best deal.
It is found from the research that people go for the product which is easily available and
affordable and also it should be according to their parameters.
The strategy for the product can be changed by comparing the different factors that
has obtained from the research. Allocation of largest consumer is the important work for
the producer so that they can match their product nature with the preference of the
consumer who are more willing to buy fruit juices.
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8. India is the world's second largest producer of food next to China, and has the potential
of being the biggest with the food and agricultural sector. The total food production in
India is likely to double in the next ten years and there is an opportunity for large
investments in food and food processing technologies, skills and equipment, especially
in areas of Canning, Dairy and Food Processing, Specialty Processing, Packaging,
Frozen Food/Refrigeration and Thermo Processing. Fruits & Vegetables, Fisheries, Milk
& Milk Products, Meat & Poultry, Packaged/Convenience Foods, Alcoholic Beverages &
Soft Drinks and Grains are important sub-sectors of the food processing industry. Health
food and health food supplements is another rapidly rising segment of this industry
which is gaining vast popularity amongst the health conscious.
India is one of the worlds major food producers but accounts for less than 1.5 per cent
of international food trade. This indicates vast scope for both investors and exporters.
Food exports in 1998 stood at US $5.8 billion whereas the world total was US $438
billion. The Indian food industries sales turnover is Rs 140,000 crore (1 crore = 10
million) annually as at the start of year 2000. The industry has the highest number of
plants approved by the US Food and Drug Administration (FDA) outside the USA.
India's food processing sector covers fruit and vegetables; meat and poultry; milk and
milk products, alcoholic beverages, fisheries, plantation, grain processing and other
consumer product groups like confectionery, chocolates and cocoa products, Soya-
based products, mineral water, high protein foods etc. We cover an exhaustive
database of an array of suppliers, manufacturers, exporters and importers widely
dealing in sectors like the -Food Industry, Dairy processing, Indian beverage industry
etc. We also cover sectors like dairy plants, canning, bottling plants, packaging
industries, process machinery etc.
The most promising sub-sectors includes -Soft-drink bottling, Confectionery
manufacture, Fishing, aquaculture, Grain-milling and grain-based products, Meat and
poultry processing, Alcoholic beverages, Milk processing, Tomato paste, Fast-food,
Ready-to-eat breakfast cereals, Food additives, flavors etc.
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9. The emerging trends in the market have confused producers to sell their products to
gain appropriate profit. India is growing day by day in various sector and preference of
people also changing according to change in business trends. Consumer buying
behavior is different according to the product. This study shows the consumer
preference with respect to fruit juices. The demand towards the product can be known
from the demographic profile, density of population, retail links and their expectations
towards the product. Fruit juices now a day become a social drink which captured the
attention of each individual of the society. The restrictions for each type of alcoholic
drinks gave a ultimate way of demand for fruit juices.
In Indian market the sever completion among the producers have encouraged them
to go for innovative ways. The competitors have a strong belief towards their brand and
products. Producers have inverted their preferences for marketing their products near
local consumers. The consumers are mostly lean towards the brands which come
across them in the daily life while going through television, news papers, and
magazines, banners displayed in roads and from websites. The juice marked had turned
into a competitive market as there are similar competitors in the market serving same
type of juice by different brand name. The brand name of fruit juices have changed the
consumer preferences because of their easy availability, price, quality, packaging,
quality etc. Here in this case those type of fruit juices brand have taken into account
who has their most market shares in the market.
The consumer buying behavior shows a way to the competitors in what respect they
can enhance themselves to exist in the market. The blind interpretation of producer
force itself towards severe loss. The perception towards the individual product shows
that whether the consumer will buy it or not. The emerging changes observed in the
different levels of consumers. The consumer also changes their preferences according
to their capability of buying for that particular product. The distinct characteristics may
sometimes attract the consumers to buy the product which they can not have purchased
before. The retail chain also plays an important role towards it which shows the
availability of product at the time of need. The consumers are again distinguished into
different age groups because of their different consumption pattern of food. In some
case it is observed that fruit juices are only acceptable for sports person for energy as
9
10. well as for relaxation, but the health consciousness factor has affected a lot each
individual so that they can drink fruit juices for good health. The campaign for fruit juices
have solved much disbelief among the consumers.
The study shows consumer buying behavior by considering the product like
Tropicana, Real, Fresh gold, Saint and Leh berry. Some of the factors are taken into
consideration like price, brand, quality, consumer type and profession of different
consumers who purchase fruit juices. Their technique of buying is the key of our study.
The buying behavior has an important role towards the growth of individual product in
the competitive market. The market is dynamic in nature and needs innovations for
existence.
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11. 1.2 OBJECTIVES & SCOPE OF THE PROJECT
To analyze the consumer awareness for fruit juices.
This objective gives a clear idea regarding the consumer awareness towards the fruit
juice as well as towards the different brands prevailing in the market. The
consumer’s awareness creates a demand towards the particular product.
Analyze the consumer; their buying behavior and demand.
The consumer buying behavior is an important parameter which consist of
consumer preferences. The demand of a project can be known from the consumer’s
buying pattern and parameters that he considers during buying a fruit juice like
quality, availability, price, packaging and delivery mode. The demand also depends
upon some of the other factors like purchasing power population, promotional
activities of product in the market and seasonality.
Understanding the demographic profile of consumers.
The consumer acceptance depends upon the knowledge and maturity level that he
has gained during his age for the different food habits prevailing in the surrounding.
The age factor is an important factor to know product demand for a particular age
group. So the interest can be made to motivate those age groups for buying their
product.
Identification of influencing factor for purchase.
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12. Consumers generally go for some of the general factors while purchasing a product
like brand, company name, expiry date, price, ingredients added, price and quality.
The perception which a customer interpret from the outer level of the product
influence him a lot to buy that. The influencing factor of purchasing makes a
producer to understand the customer need.
1.3 USE AND IMPORTANCE OF THE PROJECT
To know about the various aspect of juice market and also how to penetrate in the well
established market. Some of the things are required to know, which are as given below
—
(a). FRUIT JUICE MARKET AND CONSUMER BEHAVIOR
THE MARKET SENARIO FOR FRUIT JUICES
India produces about 9 million tons of fruits every year, growing at a rate of 12% per
annum. The total market for fruit juices is 230 million liters which includes both packed
and freshly made fruit juices. The proportion of packed fruit juices is small at just 3.4
million liters just over 1% of market, but even this huge volume translate to just 20
milliliters per capital consumption as against 45 liters in Germany, 42.5 liters in
Switzerland and 39 liters in USA. The key issue before the markets was to raise the
consumption of packet fruit juices. The consumer perception is not the constant one for
the different products available in the market. The perception of consumer depends
upon the advancement made by the producers which attracts consumers a lot and holds
the market share is huge manner. The market of fruit juices is concerned about the facts
behind fruit juices so the need for it is not diminishing but it is rapidly increasing day by
day. For every fruit juice there is certain amount of market share but the real holding of
market share depends upon the identity of the product by tacking into account price,
brand, quality, quantity, packaging availability, flavor etc.
The key Note Market Report on fruit juices and health drink covers the market for fruit
juice, health drinks and fruit drinks. In general, carbonates are excluded from this report,
12
13. although drinks of this type also be fruit based. However, ther is some overlap with the
carbonates sector as health drinks, which might be carbonated and available in ready to
drink formats of cordials are included.
For Indians drinking juice is not a new concept. Street corner vendors have been
popular for years. Fruit juices in the unorganized segment are considered cheaper and
fresher by the consumers, even though they are relatively unhygienic. The organized
natural juice market is currently in a nascent stage though it is growing at a healthy rate
35-40% per annum. This market has had high entry barriers. Few customers are
convinced about packaged juice being preservative free, and therefore, as healthy as
freshly squeezed juice. The drinks market is relatively more mature and growing at a
healthy at 20-25%. In 2003, the total UK fruit juices and health drinks market was worth
an estimated £ 2.19 billion at retail selling price (RSP), a rise of 6.6% on 2002. Fruit
juice was the largest sector in 2003, accounting for 40.2% of the total market. Despite
the relatively mature nature of the fruit juice sector, the market grew strongly in terms of
both value and volume between 1999 and 2003. In addition, fruit juices, fruit drinks and
health drinks recorded a high household penetration level. A number of factors
contributed to this growth, including the increasing interest in health and diet, which is
undoubtedly one of the main drivers. In general, fruit juices and health drinks are
regarded as healthy choices, certainly in comparison to alternative soft drinks, such as
carbonates.
In addition, the strength of the economy and rising household disposable income levels
have contributed to the growth of premium-priced products, such as freshly- squeezed
juice.
Over the next 5 years, key Note forecasts that the fruit juices and health drinks market
will remain healthy, with sales growing by an average annual rate of just over 6%.
Increasing concerns relating to health and diet will play a major role in the market, as
consumers move away from products that are perceived as being unhealthy, such as
carbonated soft drinks, towards more natural alternatives, such as fruit juices. In
addition, growing awareness of the importance e of the Government’s ‘five-a- day’
campaign to increase fruit and vegetable consumption will encourage new entrants into
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14. the market. In particular, younger consumer might regard fruit juice as a convenient way
of boosting their consumption of fruit and vegetables.
The fruit juice sector will be boosted by growing demand for premium-priced
products, such as smoothies. In addition, heavy marketing expenditure and the
introduction of new products that are fortified with vitamins and other additives should
help to drive sales. In some European countries, drink with added vitamin A, C and E
have proved very successful. Although this sector is still in its infancy in the UK, it could
show rapid growth over the next 5 years.
CONSUMPTION HABITS
81% of fruit juice consumption in India was unplanned and 38% was pure impulse.
Planned purchase of fruit juice was prevented only in metros. 60% of fruit juices
consumption happened outside the home. Fruit juice consumption was a group
activity-just 2% of the population had the fruit juice alone. Indians prefer “fresh
juices” made in front of their eyes. The origin of this preference lies in the belief that
is packed looses freshness. In the past 15 years, more than 10 brands of tetra pack
and bottled fruit juices have been launched in India. This brand also happen to be
the tetra packed fruit drinks and belonging to the largest soft drink manufacturer in
India.
In a country used to having fresh food all the time, the consumer wanted to
see the product. In food products at time seeing is creating the impulse!! tetrapack
manufactures have defined the basic need of Indian consumers by not allowing the
consumers to see the product.
In a country like India which has limited budgets for packaging given the low
disposable income level and thereby the packed foods don’t carry very attractive and
inviting pack graphics, the lack of transparency adds to discomfort levels of the
consumers.
Research showed that more than 60% preferred to see the fruit juice they
were buying. India is becoming a country which wants western style packing with
Indian style taste and thins was posing a great challenge with limited cold storage
and cold chain capabilities.
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15. Vivita-a new entrant has tried to overcome the “freshness of the juice” issue
by packing fruit juices in aseptic PET bottle with a no preservatives label. The
consumer is reassured by being able to see the product before buying.
INDIAN KEY SENSUS STATICS OF LAST YEAR
POPULATION 1100 Mn.
RURAL POPULATION 805 Mn (73%)
URBAN POPULATION 289 Mn (26%)
MALE POPULATION 578 Mn(52%)
FEMALE POPULATION 506 Mn(46%)
DENSITY 290/KM2*
PERSON PER HOUSE HOLD 5.52*
DISTRICTS 466
URBAN AGGLOMERATION AND 3768
TOWNS
VILLEGES (INHABITED) 627000
*excluding Assam and Jammu & Kashmir
Table-1
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16. (b). THE LATENT DEMAND AND POTENTIAL INDUSTRIAL EARNINGS
FOR FRUIT JUICES IN INDIA
The concept of is rather subtale. The term latent typically refers to something that is
dormant, not observable, or not yet realized. Demand is the notion of an economic
quantity that a target population or market requires under different assumptions of price,
quality and distribution, among other factors. Latent demand, therefore, is commonly
defined by economists as the industry earning of a market when that market become
accessible and attractive to serve by competing firms. Latent demand, therefore, is
commonly defined by economists as the industry earnings of a market when that market
becomes accessible and attractive to serve by competing firms. It is a measure,
therefore, of potential industry earnings (P.I.E.) or total revenues (not profit) if India is
served in an efficient manner. It is typically expressed as the total revenues potentially
extracted by firms. The “market” is defined at a given level in the value chain. There can
be latent demand at the retail level, at the wholesale level, the manufacturing level, and
the raw material level (the P.I.E. of higher levels of the value chain being always smaller
than the P.I.E. of levels at lower levels of the same value chain, assuming all levels
maintain minimum profitability).
The latent demand for fruit juices in India is not actual or historic sales. Nor is latent
demand future sales. In fact, latent demand can be either lower or higher than actual
sales if a market is insufficient (i.e. not representative of relatively competitive levels).
Inefficiencies arise from a number of factors, including the lack of international
openness, cultural barriers to consumption, regulations, and cartel-like behavior on the
part of firms. In general, however, latent demand is typically larger than actual sales in a
market.
PRODUCTION OF FRUIT JUICES IN INDIA
AVERAGE 2002 2003 2004
(1992/1994)
(‘000 TONNES)
Banana juices 9718 16820 16820 16920
Mango juices 10108 10640 10780 10800
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17. Ornage juices 1743 3120 3070 3070
Apple juices 1205 1160 1470 1470
Lemons and lime 863 1440 1420 1420
juices
Pineapple juices 956 1180 1310 1300
Grapes juices 684 1210 1150 1200
TABLE-2
For reasons discussed later, this report does not consider the nation of “unit
quantities”, only total latent revenue (i.e. a calculation of price time quantity is never
made, though one is implied). The unites used in this report are U.S. dollars not
adjusted for inflation (i.e. the figure incorporate inflationary trends). If inflation rates vary
in a substantial way compared to recent experience, actually sales can also exceed
latent demand (not adjusted for inflation). On the other hand, latent demand can be
typically higher than actual sales as there are often distribution inefficiencies that reduce
actual sales below the level of latent demand.
As mentioned in the introduction, this study is strategic in nature, taking an
aggregate and long run view, irrespective of the players or products involved. In fact, all
the current products or services on the market can cease to exist in their present form
(i.e. at a brand, R&D specification, or corporate image level) and all the players can be
replaced by other firms (i.e. via exits, entries, mergers, bankruptcies etc), and their will
still be latent demand for fruit juices at the aggregate level. Product and service
offerings and the actual identity of the players involved, while important for certain
issues are relatively unimportant for estimates of latent demand.
In order to estimate the latent demand for fruit juices across the states or union
territories and cities of India, we use to multistage approach. Before applying the
approach, one needs a basic theory from which such estimates are created. In this
case, we heavily rely on the use of certain basic economic assumptions. In particular,
there is an assumption governing the shape and type of aggregate latent demand
functions. Latent demand functions relate the income of a state or union territory, city,
household or individual to realized consumption. Latent demand (often realized as
consumption when an industry in efficient) at any level of value chain takes place if an
equilibrium is realized. For firms to serve a market, they must perceive a latent demand
17
18. and be able to serve that demand at a minimal return. The single most important
variable determining consumption, assuming latent demand exists, is income (or other
financial resources at higher levels of the value chain). Other factors that can pivot or
shape demand curves include external or exogenous shocks (i.e. business cycle), and
or changes in utility for the product in question.
Ignoring, for the moment, exogenous shocks and variations in utility across
geographies, the aggregrate relation between income and consumption has been a
central theme in economics.
Any study of latent demand requires that some standard be established to define
“efficiently served”. Having implemented various alternatives and matched these with
market outcomes, we have found that the optimal approach is to assume that certain
key indicators are more likely to reflect efficiency than others. These indicators are given
greater weight than others in the estimation of latent demand compared to others for
which no known data are available. Of the many alternatives, we have found the
assumptions that the highest aggregate income and highest income-per-capita markets
reflect the best standard for “efficiency”. High aggregate income alone is not sufficient
(i.e. some cities have high aggregate income, but low income per capita and cannot
assume to be efficient). Aggregate income can be operational zed in a number of ways,
including gross domestic product (for industrial categories), or total disposable income
(for household categories; population times average income per capita, or number of
households times average household income).
Latent demand is therefore estimated using data collected for relatively efficient
markets from independent data sources (e.g. official Chinese agencies, the world
resource institute, the organization for economic cooperation and development, various
agencies from united nations, industry trade association, the international monetary
fund, Euromonitor, Mintel, Thomson financial services, the U.S. industrial outlook and
world bank). Depending on original data source used, the definition of “frozen fruits and
concentrated fruit juices” is established. In the case of this report, the data were
reported at the aggregate level, with no further breakdown or definition. In other words,
any potential product or service that might be incorporated within frozen fruits and
concentrated fruit juices falls under this category. Public source rarely report data at the
18
19. disaggregated level in order to protect private information from individual firms that
might dominate a specific product-market. These sources will therefore aggregate
across components of a category and report only the aggregate to the public. While
private data are certainly available, this report only relies on public data at the aggregate
level without reliance on the summation of various category components. In other
words, this repot does not aggregate a number of components to arrive at the “whole”.
Rather, it starts with the “whole”, and estimates the whole for all states or union
territories and cities in India (without needing to know the specific parts that went into
the whole in the first place).
Base on the aggregate view of concentrated of fruit juices as defined above , data
were then collected for as many geographic locations as possible for the same
definition, at the same level of the value chain. This generates a convenience sample of
indicators from which comparable figures are available. If the series in question do not
reflect the same accounting period, then adjustments are made. In order to eliminate
short term effects of business cycles, the series are smoothed using an 2 year moving
average weighting scheme (longer weighting schemes do not substantially change the
results). If data are available for a geographic region, but these reflect short-run
aberrations due to exogenous shocks (such as would be the case of beef sales in a
state or union territory or city stricken with foot and mouth disease), these observations
were dropped or “filtered” from the analysis.
In some cases, data are available on a sporadic basis. In other cases, data may be
available for only one year. From a Bayesian perspective, these observations should be
given greatest weight in estimating missing years. Assuming that other factors are held
constant, the missing years are extrapolated using changes and growth in aggregate
national, state or union territory and city level income. Based on the overriding
philosophy on a long run consumption function (defined earlier), states or union
territories and cities which have missing data for any given year, are estimated based
on historical dynamics of aggregate income for that geographic entity.
Given the data available for the first three steps, the latent demand is estimated
using a “varying- parameter cross-sectionally pooled time series model”. Simply stated,
the effect of income on latent demand is assumed to be constant unless there is
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20. empirical evidence to suggest that this effect varies (i.e. the slope of the income effect is
not necessarily same for all states or union territories or cities). This assumption applies
along the aggregate consumption function, but also over time (i.e. not all states or union
territories or cities in India are perceived to have the same income growth prospects
over time). Another way of looking at this is to say that latent demand for frozen fruits
and concentrated fruit juices, adds, drinks, and non alcoholic cocktails is more likely to
be similar across states or union territories or cities that have similar characteristics in
terms of economic development.
The approach is useful across geographic regions for which some notion of non-
linearity exists in the aggregate cross region consumption function. For some
categories, however the reader must realize that the numbers will reflect a state’s, union
territory’s or city’s contributions to latent demand in India and may never be realized in
the form of local sales.
Nonlinearities are assumed in case where filtered data exist along the aggregate
consumption function. Because India has more than 5,000 cities, there will always be
those cities, especially toward the bottom of the consumption function, where non-liner
estimation is simply not possible. For these cities, equilibrium latent demand is assumed
to be perfectly parametric and not a function of wealth (i.e. a city’s stock of income), but
a function of current income (a city’s flow of income). In the long run, if a state or union
territory has no current income, the latent demand for fruit juices is assumed to
approach zero. The assumption is that wealth stock fall rapidly to zero if flow income
falls to zero (i.e. cities which earn low level of income will not use their savings, in the
long run, to demand concentrated fruit juices). In a graphical sense, for low income
cities, latent demand approaches zero in a parametric linear fashion with a zero-zero
intercept. In this stage of estimation procedure, a low-income city is assumed to have a
latent demand proportional to its income, based on the cities closest to it on the
aggregate consumption function.
Based on the models described above, latent demand figures are estimated for all
major cities in India. These are then aggregated to get state or union territory totals.
This report considers a city as a part of regional and national market. The purpose is to
understand the density of demand within a state or union territory and the extent to
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21. which a city might be used as a point of distribution within its state or union territory.
From an economic perspective, however, a city does not represent a population within
rigid geographical boundaries. To an economist or strategic planner, a city represents
an area of dominant influence over markets in adjacent areas. This influence varies
from one industry to another, but also from one period of time to another. We allocate
latent demand across areas of dominant influence based on the relative economic
importance of cities within its state or union territory. Not all cities (e.g. the smaller towns
) are estimated within each state or union territory as demand may be allocated to
adjacent areas of influence. Since some cities have higher economic wealth than others
within the same state or union territory, a city’s population is not generally used to
allocate latent demand. Rather, the level of economic activity of the city vis-à-vis is
used.
(c). FRUIT JUICE SEGMENT POISED FOR 30% GROWTH
The branded fruit juice market in India is estimated to be worth Rs 500 crores
organized fruit beverage market (nectors, drinks and juices combined) and the segment
is growing at about 30% per annum. Big players like Dabur, Pepsi, Godrej and Parle
Agro are already in the market and in view of the swift growth in the market, newcomers
like Surya Foods and Agro, Mother Dairy, Ladakh Foods, Pioma Industries have come
into the market with new product in recent years.
Primary food processing is a major industry with a highly fragmented structure that
includes hundreds of thousands of rice-mills and hullers, flour mills, pulse mills, and oil
seed mills, several thousands of bakeries, traditional food unites and fruits, vegetable
and spice processing unites in the unorganized sector. In comparison, the organized
sector is relatively small, with around 516 flour mills, 568 fish processing unites, 5293
fruit and vegetable units, 171 meat processing units and numerous dairy processing
units at state and district level.
In India is almost equally divided between the organized and unorganized sectors,
with the organized sector holding 48% of the share. While products like juices and pilp
concentrates are largely manufactured by the organized sector, the unorganized sector
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22. in foothold is in the traditional areas of processed items like pickles, sauces and
squashes. By size, pickles from the strongest category.
No doubt Dabur Real Fruit Juice is the market leader followed by Pepsi’s Tropicana.
The two major fruit juice in India, Tropicana and Real are going all out to tease Indian
taste buds with ethnic flavours. Godrej industries Food division has introduced fruit
juices under the Xs brand, which earlier only consists of only nectars. Parle Agro’s
Frooti and N-Joi too are doing well in the market. Delhi-NCR based Surya Foods and
Agro Ltd. Manufacturers of Priya Gold Biscuits has forayed into the juice segment.
Mother dairy has recently launched the Safal brand of juices. Safal is currently available
in orange, mixed fruit, grape and an orange-apple combination. Ladakh Foods makers
of the Leh Berry seabuckthorn berry drink, has now launched an apple-peach
combination juice and a mixed fruit variant. Ahmedabad-based Pioma Industries,
makers of Rasna brand of soft drink concentrates, test market with a diluted mango
juice in Andhra Pradesh recently.
(d). THE GROWTH FRUIT JUICE MARKET
This chance encounter with the wonder plant seabuckthorn was the reason Ladakh
Food was set up as a separate company in 2002 to manufacture and sell seabuckthorn
juice as LehBerry. Ladakh Foods today claims to be one of the fastest growing fruit juice
companies in a fiercely competitive environment where big names such as Dabur and
Pepsi already hold substantial market shares. Even when the fruit juice/ nectar market is
projected to grow at scorching pace of 40%, a Tetra Pak study has found that a
whopping 86% of the juice market is still lying untapped.
Perhaps one of the main reason why milk major Mother Dairy announced it is jumping
on to the bandwagon of fruit juice. The company has launched packaged fruit juices
under its flagship brand, safal. Starting from Delhi, the product is scheduled for
launched on a nationwide scale in the months to come.
Pricing is one of the major worries. Price is a barrier to this category because when you
give fresh juice, packaging becomes critical. So, what the industry is now trying to do is
offer different packaging to suit different price point while simultaneously working on
ways to offer better quality and improved taste. Pricing is also the downfall of fruit juice
22
23. importers, which distributes the Australian Brand Berri in the South, “It is difficult to
make inroads into the middle class as it finds the prices prohibitive. Sales tax on
imported products is not uniform across the States.
Taking advantage of the health consciousness pervading the market, Adluri Foods has
introduced cranberry juice (something that the local brands also have done) and is
testing a mixed vegetable juice and cocktail of apple, carrot and orange in the market.
Pepsi recently launched Tropicana Tropics Mango Nectar, which made entirely from
mangoes sourced from within India, as against other flavors for which sourcing has to
be done from other countries. The introduction of Tropics Mango Nectar will be followed
by Tropics Litchi and Tropics Guava. India is now among the top teen markets for
Tropicana worldwide. Significantly India is now an approved source for mango pulp
within the Tropicana worldwide system, and can soon emerge as a major sourcing base
for other exotic fruits for Tropicana’s international market. Which means that if the fruit
juice producers work on future development of backward linkages, the pricing issue
plaguing this industry can be better tackled. Besides, the industry has already begun to
offer packaging solutions to address different price points like a 125ml pack of fruit drink
Maaza from Coca-Cola India at just Rs 5 and 500 ml Tropicana blend for Rs 25.
With the people turning more health conscious, the non carbonated beverage segment
has become one of the fastest growing and most exciting businesses at the moment.
For some time now, manufacturers have experimented with some of the formulation and
taste issues, offering the consumers better tasting, more healthful alternatives. Evolving
from drinks containing a hint of herbs or vitamins, beverages have become an important
delivery vehicle for efficacious amount of nutritional ingredients. Beverages are unusual
products in that everyone expects to try new varieties, even from established brands.
While all segments of the beverage market are evolving, the growth seems to be
directed more towards healthy, light and low-calories drinks, in particular organic and
fruit juice varieties.
The Rs 500 crore non-carbonated beverage market in the country is composed of fruit
drinks, nectar and juices. While the Fruti drink segment is estimated at Rs 250-300crore
(branded and packed), the juice market is valued at Rs 150 crore and the nectar is a
23
24. small category of about Rs 35-50 crore. And the popular brands vying for a share in the
sector are Parle’s Frooti , Godrej’s jumpin, Coca- Cola’s Maaza, Pepsi’s Tropicana, and
Dabur’s Real,and branded fruit juices from Surya Foods (Fresh gold)among others.
The Rs 1,100 crore health food drinks (HFD) market, classified into two categories of
white and brown segments, has remained stagnant for the last several years despite
GSKCH (Glaxo Smith Kline Consumer Healthcare) and Cadbury’s attempts to activate
the category.
Dabur’s Real Fruit Juice in 9 Flavors
Dabur’s flagship brand Real fruit juice is a market leader in the packaged fruit juice
category. Real was launched in 1996 and the brand has carved out niche for itself by
claiming to be the only fruit juice in packaged form that is 100% preservative free. Real
with a market share of 55% offers its consumers the largest range of 9 juices that
comprise orange, mango, pineapple, mixed fruit, grape, guava, tomato, litchi and
cranberry.
Real Junior, available in 125 ml packs, targets children below six years. It has two
favorite flavors of mango and apple enriched with calcium. Real Active, 100% fruit juice
with no added sugar, gives the goodness of fruit without adding extra calories. Today it
is available in orange, apple, and orange-carrot variants. Real Active orange carrot
juice, India’s fist packaged vegetable juice, is a combination of juicy orange and sweet
carrots.
Dabur Food producers around 50 million liters of juice annually through its state-of-the-
art facility at Birganj, Nepal. In august 2004, the company commissioned a multi-fruit
processing facility in Siliguri, in West Bengal, set up by Pasadensa Foods, a wholly
owned subsidiary of Dabur Foods Ltd. Spread over 11 acres and geared to process 150
tons of fruit per day, it has the capacity to produce 192 tons of pulp/concentrate. The
plant procures fruit worth Rs 6 crore from West Bengal, North-East, Bihar, Uttar
Pradesh, Maharastra, and Andhra Pradesh. It has the highest capacity utilization by
processing pineapple, litchi, guava, mango and grape round the year.
Gogrej Xs Fruit Juice is packed with extra tang and extra fun.
24
25. Xs range of fruit nectar has more fruit making it thick and tasty. Also the vitamins and
carbohydrates present in it provide extra energy for fit and healthy living. Available in
orange, litchi, mango, and pineapple flavors, Xs comes in tetra Pack of 200 ml and
1000ml.
Pepsi’s Tropicana
Pepsi’s Tropicana brand fruit juice has registered double digit growth and has outpaced
the growth off the packaged fruit juices market in India. India is a very important market
for Tropicana and is among the top 10 biggest markets for the brand. The company
sources orange juice concentrates from Brazil. Tropicana is available in orange, apple,
grape and cranberry flavors and a cocktail in Ruby red. They come in Tetra packs of
one liter and PET bottles of 500 ml and one liter.
(e). FRUIT JUICES GO LOCAL
The two major fruit juice makers in India Tropicana and Dabur are going all out to tease
Indian taste buds with ethnic flavors. PepsiCo terms these as flavors that are more
relevant to Indians.
For Tropicana India is providing to be a good investment as according to top officials in
the company, “India is among Tropicana’s top ten markets which is continuously moving
up having registered a stong double digit growth last year”. But they did not reveal any
number.
The company wants to ensure that the strong growth continues and also that the market
expands further. To this end Tropicana has launched a sub-brand Tropicana Tropics
and is introducing new flavors mango nectar, guava pulp and litchi juice under this
brand. It may be recalled that Pepsi had launched mango and litchi flavor earlier under
its fruit drink brand ‘Slice’ in returnable glass bottles.
The new variant are expected to come for around Rs 50 per liter as these come under
the category of ‘less than 20 % fruit pulp’ making them less pricy than Tropicana fruit
juices all of which retail at above Rs 70 per liter. Tropicana juices have 80 percent fruit
pulp content.
25
26. At present Tropicana have about seven flavors in the market – apple, pineapple,
orange, apple orange, grape and mix fruit. Tropicana is also looking at making India the
sourcing hub for certain varieties of fruits mainly mango. Pepsi is already exporting
nearly 20,000 tons of mango pulp and concentrate predominantly to west Asia and
Europe from India. The company is now working on building the same capacities for
other fruits like guava, pineapple, papaya pulp, grapes, and pomegranate. PepsiCo
teamed up with Punjab, which is expected to start producing results very soon. The
company is now looking for a similar deal with pineapple farmers in Kerala. According to
PepsiCo India spokesperson, the company has begun trials of pineapples imported from
Thailand and the Philippines in Kerala. At present the company sources organic juice
concentrates from Brazil but through the ongoing project, it is trying to develop a large
grower base, which can produce high juice yielding oranges to match its requirements.
“India produces 47 million tons of fruits which provides us as exciting export opportunity
within the Asia Pacific region”.
Dabur Foods is also going local with a vengeance with its fruit juices. It is also aiming to
expand its market by introducing juices with a lower price tag. The company has
launched a new brand ‘Coolers’ in four variants – green mango, pomegranate, jamun,
and water melon with one liter of Cooler priced at Rs 50. Coolers like Tropicana Tropics
also contain only 20 % of fruit pulp against over 80% of Real variants. Dabur is also
aiming at expanding its consumer base. Dabur’s Real brand of fruit juices has proved
very successful contributing as much as 85% to the company’s Rs 85 crore turnover last
fiscal. According to the company Coolers has been launched of Rs 12 crore, into
research into consumer needs and development of processing capabilities and
parameters on the other.
(f). FACTOR AFFECTING DEMAND
A. POPULATION
Population growth in India is currently 2 per cent per year and varies from state to state.
The states with the highest per caput fruit consumption are usually those with lower
population growth rates. According to official statistics, population growth is expected to
decline to 1.5 % per year by 2011 when the total population of India is expected to 1.2
26
27. billion. Significant potential exists to expand fruit consumption in rural areas; states with
currently low per capita consumption are increasingly evident in urban areas, for
virtually all income groups with the higher income levels showing the highest per-capita
consumption rates.
B. INCOME AND PRICES
THE Indian economy has achieved significant growth over the past 20 years. Real
annual GDP growth rates have averaged 4.7 per cent over a period, despite the Asian
economy crisis and slow industrial growth in past five years. Real per caput income
levels increased 3.4 per cent per year from 1981 to 1998, with household expenditure
for fruits and vegetables estimated to have increased 5 per cent per year over the same
period. Annual per caput fruit consumption also increased from 25 Kgs in 1981 to 31
Kgs in 1998.
There is a significant positive relationship between income and fruit consumption. The
consumption of Tropical and other fruits is highly related to income levels. Data from the
Indian Agriculture Research Institute indicate that the richest income group consumes
six times more fruit than the lowest income groups, in both rural and urban areas, with
per caput consumption in urban areas almost twice that of rural areas. Or rural areas,
the overall weighted average of the income elasticity of fruit demand for the highest
income group was estimated at 0.283 compared to 0.826 for the lowest income levels.
Similarly for urban areas, the income elasticites were 0.293 and 0.782 respectively.
Thus, the highest the income the less the responsive is fruit consumption to changes in
income levels. Given this relationship between income and demand, lower income
groups are likely to account for most of the future growth of the market in India, although
high income groups may increasingly substitute tropical fruit for other fresh fruits as fruit
consumption in these groups approaches saturation.
Prices of fruit have increased more than the General Price Index with total fruit
consumption generally highly sensitive to price changes, as discussed above. A
substantial price differential exit between wholesale and retail prices as shown by table
10 primarily due to the margins captured by intermediate buyers and sellers, perish
ability of product, and long distances between wholesale and retail markets. High retail
27
28. prices for fresh tropical fruit are one of the primary constraints to increasing
consumption, particularly among middle to low income households.
C. CONSUMPTION HABITS AND PREFERENCES
Consumers in India have become increasingly aware of the positive health aspects of
fruit consumption, particularly in urban areas. A mre diversified diet and interest in
healthier eating has led to increased consumption of all fruits. Prices also play an
important role in consumer preferences for individual fruits, with tropical fruit prices
typically lower than for temperate fruit. Temperate fruits tend to be consumed by the
higher income groups; while tropical fruit consumption is more wide spread. Large
quantities of fresh unripe mangoes are utilized in household preparation of pickles and
chutneys. The market for minor tropical fruits, such as passion fruit, carambola and
avocado is expected to rapidly increase over the near to mid-term, with consumption
concentrated in higher income groups at the present time.
D. PROMOTIONAL ACTIVITIES
Few national or regional promotional activities, either commercial or state-sponsored,
have been developed to encourage domestic consumption of tropical or other fruits in
past years. However, nutritional education programmes by the government of India
have resulted in rising demand for higher quality fruit, as well as increased preferences
for more varied diets (including more fruit consumption). A number of large agro-
processing industries have initiated promotional programmes for processed fruit and
juice products in recent years, utilizing mass media and in-store promotions to enhance
brand recognition and encourage consumption.
E. SEASONALITY
A survey of three wholesale terminal markets in October 1999 revealed large variations
in price due to seasonality. Furthermore, despite some efforts to better manage
surpluses due to seasonality, an estimated 25 % of total fruit production goes to waste
during post- harvest handling, according to National Horticulture Board of the Ministry of
Agriculture for India. Although the Government of India has taken steps to improve the
overall conditions of the fruit industry, future growth is constrained due to inadequate
28
29. refrigeration and cooling facilities, remote market access and export infrastructure not
meeting the demand requirements for export of fresh fruits.
(g). CONSUMERS PURCHASING BEHAVIOUR
The availability of consumer food products in India has grown significantly since the
economic reforms beginning in 1991. Indian consumers can now purchase domestically
produced cheese, wine, potato chips, ketchup, soft drinks, candy bars, breakfast
cereals, ice cream, donuts, biscuits, frozen meats and vegetables, instant noodles, jams
and jellies, packaged grains and pulses, soups and some ready to eat packaged and
frozen meals. Availability of fresh produce is seasonal. Retail food sales in India were
approximately $132 billion in fiscal year 1998 and are growing at 13% per year,
according to the Ministry of Finance. The retail market for fruits and vegetables has
grown at over 20% per year in the past few years. Retail sales of subsistence foods
such as cereals, breads, pulses, and edible oils have started declining. As incomes
have risen, there has been a shift in consumption, from subsistence to higher value
foods.
Many Indians are vegetarian by tradition; moreover, many can only afford a vegetarian
diet. Meast may be regularly consumed by less than 30 % of the Indian population, due
to its higher cost and predominance of vegetarianism and Hinduism. However, only 20%
of the population is strictly vegetarian. Non vegetarians typically consume meat only
once or twice a week. Higher income consumers rely almost entirely on domestic help
for their shopping. The domestic help buys staples, vegetables, and fresh foods from
local small grocers and vendors, and other products from a variety of general
merchants. The middle class has diverse purchasing habits. Many families on the
upper end use part-time domestic help to do their shopping, often necessitated by
growing pattern of household with two working parents. Many families at the lower end
of the middle class continue to do their own shopping. The poorer segments of the
Indian population tend to buy basic staple with the first part of their paychecks, which
typically are distributed on the first few days of each month. During the month, the
poorer customers will buy whatever fresh foods and consumer goods they can afford,
29
30. often filling in at the end of the month with some additional staples purchased on credit.
In all classes, women do most of the shopping and make most of the food purchase
decision. Most consumers prefer local shops to larger supermarkets because of
proximity, personal attention and lower prices. Nearly 95% of consumers purchase fresh
fruits and vegetables from a local market or street vendor. Additionally, traditional
markets are considered the freshest source for foods.
(h). OUTER FABRIC ATTRACTS CONSUMERS
As consumer preferences in the country are shifting towards healthy, natural food
products, the demand for non-carbonated soft drink is accelerating. In the face of
increasing competition, companies are redesigning the packages that they offer their
product in. at the same time, safety, long shelf life, convenience and economic viability
are important considerations while choosing packaging options.
What are the international trends in the packaging of fruit juices? Can any one of these
trends be replicated in India?
Internationally a variety of packaging formats are being used for packaging fruit juices.
One of the most popular is aseptic cartons. This is the most popular format in the
organized juice market in India accounting for over 60% of the market. The recent entry
of Mother Dairy into the segment points to the growing popularity of this packaging
format. More than anything else the entire aseptic processing and packaging system
ensures the availability of nutritious products in safe and hygienic formats, which are
also convenient to use. A look at any market in Asia will show how aseptic packaging is
growing in popularity.
The increase in demand for fruit juices in the recent years, and the growth in their
production is inevitably leading to an increase in demand for packaging options in India.
What are the technological innovations that have been introduced in the sector to cater
to the increasing demand?
The increased demand has led to an increase in number of size, shapes and even
printing technology innovations, besides the obvious one of ensuring improved product,
30
31. taste, quality. Manufacturers are getting more aggressive by offering new product to
consumers.
Could you elaborate on the spin-cap and cold fill technology – packaging options are
related technologies that Tetra Pack has recently introduced for packaging fruit juice.
Which companies are using these technologies and what are their benefits ? What other
technologies have been introduced recently for packaging fruit juices ? The spin cap is a
pack opening option that was introduced a couple of year ago. Used the world over, it is
currently being used only by Dabur in India. Tropicana and Mother Dairy both use the
recap option.
Cold fill technology’s biggest benefit is that it ensures microbiological safety and a
bacteria free product while keeping the nutritional values intact through the use of a
gentle heat treatment process which retains original state of the product and ensures
that the consumer gets value-for-money.
Slim line packaging for fruit juices and its benefits over baseline packaging-
The difference between the two is the aesthetics. There is no difference in the
technology used in both these options. For both the manufacturer and retailer, slim line
packaging is easier to handle in the distribution chain. It also gives the manufacturer
more surface area for graphics.
1.4 Marketing Research
Marketing research is a form of business research and is generally divided into two
categories: consumer market research and business-to-business (B2B) market
research, which was previously known as industrial marketing research. Consumer
marketing research studies the buying habits of individual people while business-to-
business marketing research investigates the markets for products sold by one business
to another.
Consumer market research is a form of applied sociology that concentrates on
understanding the behaviours, whims and preferences, of consumers in a market-based
31
32. economy, and aims to understand the effects and comparative success of marketing
campaigns. The field of consumer marketing research as a statistical science was
pioneered by Arthur Nielsen with the founding of the ACNielsen Company in 1923.
Thus marketing research is the systematic and objective identification, collection,
analysis, and dissemination of information for the purpose of assisting management in
decision making related to the identification and solution of problems and opportunities
in marketing. The goal of marketing research is to identify and assess how changing
elements of the marketing mix impacts customer behavior.
Role of marketing research
Traditionally, marketing researchers were responsible for providing the relevant
information and marketing decisions were made by the managers. However, the roles
are changing and marketing researchers are becoming more involved in decision
making, whereas marketing managers are becoming more involved with research. The
role of marketing research in managerial decision making is explained further using the
framework of the DECIDE model:
D —- Define the marketing problem
E —- Enumerate the controllable and uncontrollable decision factors
C —- Collect relevant information
I —- Identify the best alternative
D —- Develop and implement a marketing plan
E —- Evaluate the decision and the decision process
The DECIDE model conceptualizes managerial decision making as a series of six steps.
The decision process begins by precisely defining the problem or opportunity, along with
the objectives and constraints. Next, the possible decision factors that make up the
alternative courses of action (controllable factors) and uncertainties (uncontrollable
factors) are enumerated. Then, relevant information on the alternatives and possible
32
33. outcomes is collected. The next step is to select the best alternative based on chosen
criteria or measures of success. Then a detailed plan to implement the alternative
selected is developed and put into effect. Last, the outcome of the decision and the
decision process itself are evaluated.
TYPES OF MARKETING RESEARCH
Marketing research techniques come in many forms, including:
• Ad Tracking – periodic or continuous in-market research to monitor a brand’s
performance using measures such as brand awareness, brand preference, and
product usage. (Young, 2005)
• Advertising Research – used to predict copy testing or track the efficacy of
advertisements for any medium, measured by the ad’s ability to get attention,
communicate the message, build the brand’s image, and motivate the consumer
to purchase the product or service. (Young, 2005)
• Brand equity research - how favorably do consumers view the brand?
• Brand association research - what do consumers associate with the brand?
• Brand attribute research - what are the key traits that describe the brand
promise?
• Brand name testing - what do consumers feel about the names of the products?
• Commercial eye tracking research - examine advertisements, package
designs, websites, etc by analyzing visual behavior of the consumer
• Concept testing - to test the acceptance of a concept by target consumers
• Coolhunting - to make observations and predictions in changes of new or
existing cultural trends in areas such as fashion, music, films, television, youth
culture and lifestyle
33
34. • Buyer decision processes research - to determine what motivates people to
buy and what decision-making process they use
• Copy testing – predicts in-market performance of an ad before it airs by
analyzing audience levels of attention, brand linkage, motivation, entertainment,
and communication, as well as breaking down the ad’s flow of attention and flow
of emotion. (Young, p 213)
• Customer satisfaction research - quantitative or qualitative studies that yields
an understanding of a customer's of satisfaction with a transaction
• Demand estimation - to determine the approximate level of demand for the
product
• Distribution channel audits - to assess distributors’ and retailers’ attitudes
toward a product, brand, or company
• Internet strategic intelligence - searching for customer opinions in the Internet:
chats, forums, web pages, blogs... where people express freely about their
experiences with products, becoming strong "opinion formers"
• Marketing effectiveness and analytics - Building models and measuring results
to determine the effectiveness of individual marketing activities.
• Mystery Consumer or Mystery shopping - An employee or representative of
the market research firm anonymously contacts a salesperson and indicates he
or she is shopping for a product. The shopper then records the entire experience.
This method is often used for quality control or for researching competitors'
products.
• Positioning research - how does the target market see the brand relative to
competitors? - what does the brand stand for?
• Price elasticity testing - to determine how sensitive customers are to price
changes
34
35. • Sales forecasting - to determine the expected level of sales given the level of
demand. With respect to other factors like Advertising expenditure, sales
promotion etc.
• Segmentation research - to determine the demographic, psychographic, and
behavioural characteristics of potential buyers
• Online panel - a group of individual who accepted to respond to marketing
research online
• Store audit - to measure the sales of a product or product line at a statistically
selected store sample in order to determine market share, or to determine
whether a retail store provides adequate service
• Test marketing - a small-scale product launch used to determine the likely
acceptance of the product when it is introduced into a wider market
• Viral Marketing Research - refers to marketing research designed to estimate
the probability that specific communications will be transmitted throughout an
individuals Social Network. Estimates of Social Networking Potential (SNP) are
combined with estimates of selling effectiveness to estimate ROI on specific
combinations of messages and media.
• All of these forms of marketing research can be classified as either problem-
identification research or as problem-solving research.
• A company collects primary research by gathering original data. Secondary
research is conducted on data published previously and usually by someone
else. Secondary research costs far less than primary research, but seldom
comes in a form that exactly meets the needs of the researcher.
• A similar distinction exists between exploratory research and conclusive
research. Exploratory research provides insights into and comprehension of an
issue or situation. It should draw definitive conclusions only with extreme caution.
Conclusive research draws conclusions: the results of the study can be
generalized to the whole population.
35
36. • Exploratory research is conducted to explore a problem to get some basic idea
about the solution at the preliminary stages of research. It may serve as the input
to conclusive research. Exploratory research information is collected by focus
group interviews, reviewing literature or books, discussing with experts, etc. This
is unstructured and qualitative in nature. If a secondary source of data is unable
to serve the purpose, a convenience sample of small size can be collected.
Conclusive research is conducted to draw some conclusion about the problem. It
is essentially, structured and quantitative research, and the output of this
research is the input to management information systems (MIS).
• Exploratory research is also conducted to simplify the findings of the conclusive
or descriptive research, if the findings are very hard to interpret for the marketing
managers.
The five basic method of marketing research
While there are many ways to perform market research, most businesses use one or
more of five basic methods: surveys, focus groups, personal interviews, observation,
and field trials. The type of data you need and how much money you’re willing to spend
will determine which techniques you choose for your business.
1. Surveys. With concise and straightforward questionnaires, you can analyze a sample
group that represents your target market. The larger the sample, the more reliable your
results will be.
• In-person surveys are one-on-one interviews typically conducted in high-traffic
locations such as shopping malls. They allow you to present people with samples of
products, packaging, or advertising and gather immediate feedback. In-person
surveys can generate response rates of more than 90 percent, but they are costly.
With the time and labor involved, the tab for an in-person survey can run as high as
$100 per interview.
• Telephone surveys are less expensive than in-person surveys, but costlier than
mail. However, due to consumer resistance to relentless telemarketing, convincing
people to participate in phone surveys has grown increasingly difficult. Telephone
surveys generally yield response rates of 50 to 60 percent.
36
37. • Mail surveys are a relatively inexpensive way to reach a broad audience. They're
much cheaper than in-person and phone surveys, but they only generate response
rates of 3 percent to 15 percent. Despite the low return, mail surveys remain a cost-
effective choice for small businesses.
• Online surveys usually generate unpredictable response rates and unreliable
data, because you have no control over the pool of respondents. But an online
survey is a simple, inexpensive way to collect anecdotal evidence and gather
customer opinions and preferences.
2. Focus groups. In focus groups, a moderator uses a scripted series of questions or
topics to lead a discussion among a group of people. These sessions take place at
neutral locations, usually at facilities with videotaping equipment and an observation
room with one-way mirrors. A focus group usually lasts one to two hours, and it takes at
least three groups to get balanced results.
3. Personal interviews. Like focus groups, personal interviews include unstructured,
open-ended questions. They usually last for about an hour and are typically recorded.
Focus groups and personal interviews provide more subjective data than surveys. The
results are not statistically reliable, which means that they usually don't represent a
large enough segment of the population. Nevertheless, focus groups and interviews
yield valuable insights into customer attitudes and are excellent ways to uncover issues
related to new products or service development.
4. Observation. Individual responses to surveys and focus groups are sometimes at
odds with people's actual behavior. When you observe consumers in action by
videotaping them in stores, at work, or at home, you can observe how they buy or use a
product. This gives you a more accurate picture of customers' usage habits and
shopping patterns.
5. Field trials. Placing a new product in selected stores to test customer response
under real-life selling conditions can help you make product modifications, adjust prices,
or improve packaging. Small business owners should try to establish rapport with local
store owners and Web sites that can help them test their products.
37
38. Business to business market research
Business to business (B2B) research is inevitably more complicated than consumer
research. The researchers need to know what type of multi-faceted approach will
answer the objectives, since seldom is it possible to find the answers using just one
method. Finding the right respondents is crucial in B2B research since they are often
busy, and may not want to participate. Encouraging them to “open up” is yet another
skill required of the B2B researcher. Last, but not least, most business research leads to
strategic decisions and this means that the business researcher must have expertise in
developing strategies that are strongly rooted in the research findings and acceptable to
the client.
There are four key factors that make B2B market research special and different to
consumer markets.
• The decision making unit is far more complex in B2B markets than in consumer
markets
• B2B products and their applications are more complex than consumer products
• B2B marketers address a much smaller number of customers who are very much
larger in their consumption of products than is the case in consumer markets
• Personal relationships are of critical importance in B2B markets.
International Marketing Research
International Marketing Research follows the same path as domestic research, but
there are a few more problems that may arise. Customers in international markets may
have very different customs, cultures, and expectations from the same company. In this
case, secondary information must be collected from each separate country and then
combined, or compared. This is time consuming and can be confusing. International
Marketing Research relies more on primary data rather than secondary information.
Gathering the primary data can be hindered by language, literacy and access to
technology.
38
40. The research methodology based on the primary and secondary data both. Secondary
data are collected from different secondary sources of information.
Primary data were collected by me at different places of Indirapuram (Ghaziabad) and
Noida. I prepared a questionnaire which consisted of 9 questions and a suggestion
space at the below regarding the FRESH GOLD juice. I visited around 125 people at
different places to get their feedback about the product. Basically I tried to know how
many people were there who even know about this product because most of them were
unaware of this product. During the survey I visited food bazaar (shipra mall), food
bazaar (aditya city center) and shipra market, all the places at indirapuram only,
because the store manager of food bazaar didn’t allow me to take the feedback of
people inside the premise of food bazaar so I took all the feedbacks from the people
who are coming out of the food bazaar at outside of the shop. After visiting these areas I
visited my college campus (ims noida) and Haldirams Product Pvt. Ltd.
(sec-63,noida) and got the feedbacks from their employees. Through this I got all the
filled form and consumers feedback.
Then I started visiting to the retailers of Indirapuram only. I visited around 20 retail
shops to get their feedbacks, because almost all the shopkeepers have denied to fill any
kind of form so I got their views only by the conversation. They were having so much
complains regarding the supply and demand.
40
41. It gives a clear idea regarding the approach of the study to understand the buying
behavior of the consumers for the fruit juices. The source of information of past
consumer behavior for the fruit juices and the present consumer buying behavior
compares the differences among the acceptance of product. The recent trends of
market also pay emphasis towards the consumer preference. The understanding the
fruit juice scenario of India is a important study to make a conclusion regarding the
growth of fruit juices in the market, acceptance of particular brand by the people, past
draw backs made by the producers and recommendations by the consumers.
The review of theoretical concepts which are the research based view, core
competence, sustainable competitive advantage concept and the cost leader ship
strategy. The theoretical concepts of demand in this study show the demand
determination process of a particular product prevailing in the market with high market
share.
Source of secondary data are the books, magazines, internet, television, news papers.
There is no particular or specific book where the complete information about consumer
behavior for fruit juices is available. In this case the information from different books is
collector and assimilated according to the study objective. The magazines like frontline,
business world, Sunday times, Outlook provideds lot of information for it. Television is
another important source of information for this project from which recent data are
collected for study. The channels like Star News, Aaj Tak , NDTV has the importance for
providing the market share data of the products considered in the study. This is the
current source of information in once hand as a hard copy. The news papers (especially
Bussiness Newspapers) provided the desired information. Like Economic Times and
Business Standard etc. these papers are so important that sometimes they play their
role both as secondary as well as Primary source of data (because sometimes the
current information that is available through these papers are not even uploaded on
Internet also.)
Developing strategy based on the customer feedback i.e. collection of primary data by
considering a definite sample size considered is the local area (Indirapuram). The data
which are being collected from the consumer during the primary analysis are separated
according to their specific weightage. From the question five comparative questions are
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42. considered for comparison. The open ended questions and the closed ended questions
used in the questioner for customer feedback have different weightage and are
separated to make a unique analysis. The main influencing questions are again
analyzed to get clear result from the analysis. The different companies are considered
for realizing the perfect completion among them so that perfect interpretation can be
made upon them. For study the fruit juice brands which are considered are Real,
Tropicana, Saint, Fresh gold and other competitors are also considered for the
secondary study but not encountered in the main study.
For detailed comparison according to different parameters like availability, price, quality,
flavor, customer feedback, packaging the questioner are sorted out and the ranking are
calculated. The ranking is made like first, second and third. The First rank the highest
three points, the second rank has two points and the third rank has one point. According
to the rank the numbers of persons are calculated who have given the rank according to
the different parameters. The points obtained from the number of the persons gives rise
to intermediate point. The summation of all points is a result of total point which is the
main criteria for comparison.
The techniques are used different for secondary analysis as well as per primary
analysis. In secondary analysis the relevant data are obtained from news papers,
magazines, television, and websites. For primary data collection the techniques used
are questioner technique and personnel interview. The data collection from the primary
source is analyzed by graphical methods. The questioners are separated according to
different parameters and different points are assigned for them for perfect weightage to
place in the comparative graphs. The pie chart, bar graph and line graph are used in
this study to compare different parameters.
After analyzing all my data I got from the consumers, I found that the main thing is to
place the product at the shelf of retail shops, so the public see it and get aware of it. For
this we need to strengthen the supply chain.
42
43. 3. Profile Of The Organisation:
“SURYA FOODS & AGRO LTD”.
43
44. Company Profile :
Surya Food & Agro Ltd. was incorporated in November 1992 and commenced its
commercial operations of manufacturing & selling of biscuits under brand “Priyagold”
October 1993. Over a period, they have established strong manufacturing capabilities
and have invested substantially in developing consumer preference for our products.
Their trademarks / brands “Haq Se Maango” & “Priyagold” have emerged as one of the
most powerful brands in the FMCG sector. They are committed to invest in brands,
manufacturing capabilities, deliverables and distribution strength.
They have three plants located in Greater Noida, Lucknow & Surat. They also
outsource some of their requirements to another plant located in Hyderabad. Their
capacities have reached 1,50,000 MT p.a., which along with strong brand building
and distribution capabilities have enabled them to command a sizable market share
in the biscuit market despite competition from well-established players in the industry.
After establishing their foothold in biscuit industry, they continued to adopt strategy to
identify and commercialize profitable growth opportunities by leveraging established
brand and distribution network. Following this strategy, they diversified into
manufacturing of “fruit juices” through their wholly owned subsidiary “Surya
Fresh Foods Ltd.” in January 2006. The manufacturing facility is located at Greater
Noida, U.P. They have consciously invested in creating markets for fruit juices and
have established brands such as “Fresh Gold” & “Treat”.
44
45. Both the brands are also well established and have penetrated into the fruit juice market
aggressively by commanding considerable market share. They have also forayed into the
aerated fruit drink segment with the launch of “Fresh Fizzy.”
They are also aggressively marketing their products in institutional category. Presently their
products viz. biscuits and fruit juices are supplied to Airlines, Hotels, Railways, Canteens Stores
Department (CSD) and organized retail outlets.
They are also diversifying into manufacturing of “chocolate and toffee & candy” through our
wholly owned subsidiary “Surya Processed Food Pvt. Ltd.” at Haridwar, Uttarakhand, where
various fiscal benefits are available.
Their strategy of strengthening the brands especially the umbrella brand “Priyagold” has resulted
in creating immense brand recall value. They are continuing with our effort of strengthening the
brand with a scientific approach, which will result in growth of customer base, price premium,
consumer loyalty which is expected to result in increased earning and ultimately enhancing
enterprise value of our company.
Thus the company’s manifesto is to build on the present strength created over the
years and diversify into products and geographic portfolio. We aim at achieving
profitable growth by penetrating into the consumption market to enhance market
share by constantly innovating on product profile, investing in infrastructure
thereby accelerating the top line growth to enhance the market share.
Delhi NCR-based Surya Foods and Agro Ltd, manufacturers of Priyagold biscuits, has
forayed into the juices segment. It has set up a state-of-the-art manufacturing facility in Greater
Noida with an investment of Rs 25 crore. The plant has a capacity of producing 1.5 lakh litres of
juice per day.
Branded `Freshgold', the one-litre juice in cartons is available in supermarkets and malls in and
around Delhi for Rs 60. Speaking to Business Line, Mr B.P. Agarwal, Chairman, Surya Foods and
Agro Ltd, said, "Though the juices are currently available only in the northern markets”
The Rs 300-crore turnover company is also setting up a biscuit plan to launch it in the
south by the next month. We are also working on a specific distribution network for the same."
manufacturing plant in Uttaranchal to avail of the tax incentives.
45
46. "We are investing around Rs 20 crore on the plant with a capacity of 100 tonnes per day, which
would be operational by December 2006," Mr Agarwal said.
The company has been keeping a low profile with regard to advertising and promotions after its
not-so-good experience with the `Priyagold khaao or khelo' contest. According to Mr Agarwal,
"The retailers did not give out the coupons to the end-consumers. Consequently, we had to
withdraw the scheme from the market." However, he said that the company has earmarked
around Rs 3 crore for promoting the juices. While tele-commercials have already begun on
IndiaTV, the company is hopeful of running them on all other channels by the next fortnight.
it is also in the process of sprucing up its exports operations. Currently it exports its biscuits to
countries such as Dubai and Nepal.
According to Mr Agarwal, "The high level of taxation in the domestic market, which is a major
concern, is one of the reasons why we are looking to increase export volumes."
Explaining further, he pointed out that high input costs and taxes are affecting margins and profits.
As fierce competition from other players is preventing the company from increasing prices, he
said, "High taxes are even forcing manufacturing units to close down. In fact, we have already had
to shut down two out of six company's plants."
While speaking on the company's performance, he said, "We face immense competition not just
from competitors in organised retail but also from the unorganised market which holds almost 40%
of the market share and has the benefit of not being subject to any taxes." The government needs
to look into the matter before the situation worsens, he added.
Quality Assurance
Surya Foods & Agro. (P) Limited ensures that the highest levels of quality are maintained
throughout the manufacturing process. Each step of our processes undergoes strict checks at
various levels, being supervised by our quality assurance team. All the products are
manufactured under 100% clean and hygienic conditions.
Our speciality lies in our ability to deliver pure and natural juices in a wide variety of flavours
with no artificial ingredients and are completely safe for consumption. All the products are
packed in air-tight packaging materials to restore their freshness. The date of manufacturing
as well as that of expiry are clearly mentioned on the pack so as to avoid any confusion. Only
approved products that meet the stringent standards laid down by the relevant food
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47. authorities are sent for dispatch.
Their Processes
Our manufacturing processes are conducted under the most hygienic conditions, and we
have a clean manufacturing facility which is well equipped with a host of advanced and
sophisticated machinery for our purposes. Many of our machines like Tetra Therm Aseptic
Flex, the latest sterilizers, are exclusively imported from countries like Sweden.
Our versatile packaging department makes use of the most standardized packaging materials
to give our product an attractive appeal as well as to keep the contents intact and safe. All
the products are stored in a capacious warehouse with cold storage facility, thereby enabling
us to meet all forms of market demands in the most efficient manner.
Their Strengths
• Well developed infrastructure for efficient processing
• A team of pro-active and qualified staff having years of experience
• A wide variety of products in different flavours with high nutritional value
• Quality checks in accordance with the national and international standards
Constant research and innovation to produce better products.
Karishma kapoor - Brand Ambassador for Priyagold
Merely before couple of weeks, we had alluring missy Deepika Padukone signing for BSNL as
brand ambassador. Fine! We have one more hot celebrity getting roped in for brand
ambassadorship, but not for BSNL. Karishma Kapoor has been opted as new brand
ambassador for 'Surya Food & Agro Ltd'; a U.P. based Food Company at Noida, known for
Priyagold biscuits. Sooner, we will espy the pulchritudinous actress recommending three
products from the Priyagold stable – Butter bite, Butter bite Badam Pesta and Marie lite.
Perhaps, this is the first time Priyagold has preferred for celebrity endorsement. And earlier, it
was TV personality Priya Tendulkar who plumped for these products a decade ago. Karishma
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48. has spelled that it's because of her personal preference for Priyagold products, she signed for
brand ambassadorship.
Karishma Kapoor is the new brand ambassador of the Noida; U.P. based fast emerging food
company “Surya Food & Agro Ltd”, known for Priyagold biscuits. This is the first time
Priyagold has opted for celebrity endorsement since the TV personality Priya Tendulkar
endorsed the biscuit for Indians ten years back. For Karishma the product fits into her life
seamlessly. She is a celebrity housewife, mother and concerned of the quality of what she
and her family consumes.
Karishma will soon be seen recommending three products from the Priyagold stable – Butter
bite, Butter bite badam pesta and Marie lite. The advertisements created are straight forward
brand endorsement with no complicated storyline or special effects in the visual. The
message to the viewers is clear.
“We had been looking for a celebrity who can easily be associated with our product. In
Karishma Kapoor we got that. “Karishma being a modern day housewife and a celebrity
mother is always concerned about her kid’s & family’s health in today’s hectic life, said
Shekhar Agarwal, Director of Surya Food.
“Priyagold biscuits are favorites in kids. I too have grown up eating these biscuits and like the
taste immensely. In fact I agreed to endorse the product it is because of my personal
preference for Priyagold products”. Said Karishma Kapoor
The reason why the company has opted to keep the message direct and simple is the fact
that such endorsements are easy to recall. Unlike other celebrity endorsements of similar
products where film stars have been seen promoting biscuits, at the end of the day viewers
fail to recall the product. Also Shekhar feels that biscuits are commodities and need to be
promoted as such.
Chocolate news
Surya Food & Agro is going to introduce chocolates and wafers in November as part of its
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49. plan to extend the product portfolio.
Surya Food & Agro is a leading biscuit manufacturer of the `Priyagold` brand. This is a Noida
based company and has a turnover of Rs 400 crore. Now, the company is expecting its new
products to register revenue of Rs 10 crore by Mar 31.
Shekhar Agarwal, the director of the company said, "Our chocolate and wafers will be
introduced in the market when our Haridwar plant commences operations in November."
He added, "Initially, our target is the north Indian market where Priyagold has a stronghold."
He said that about 10 variants of chocolates and wafers would be launched there.
Agarwal informed that the company has invested Rs 30 crore in the project for installing
modern machineries for the 10 tons per day capacity plant at Haridwar. The chocolates and
wafers would be sold under `Priyagold` brand with a separate sub-brand for each Variant, he
said.
But, Agarwal denied to disclose the names of variants, but said they would be placed near the
existing names of big players like Nestle and Cadbury. The company will keep the price of
their chocolates same as the leading companies.
Agarwal added, "Our products will be cheaper as they would have more quantity in weight."
The company would leverage on the existing network of Priyagold biscuits for distribution
purpose and offer more discount to retailers so that they are attracted to keep the products.
The biscuit manufacturer, which also makes juices, has a considerable market share in Delhi,
Uttar Pradesh, Haryana, Punjab and Rajasthan.
Products / Services :
We are manufacturer, suppliers and exporters of Biscuits such as :
Butter Bite
Crack N Cheers
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50. Nice Day
Marie Lite
Kids Cream Butter
Strawberry
Chocolate
Coconut crunch
Glucose V Extra
Magic Gold
Snacks Zig Zag
Orange
Cheez Bit
Jeera Top
Cashew
Cheese Cracker
Elaichi
Milk
Trick-or-Treat Pizza Biscuits
Southern Style biscuits such as Spices, Cheese & Bacon Bake, Cream Cheese & Jelly Bake,
Berries & Cream Bake.
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52. The primary research analysis fulfill the objectives of the study. According to the
objective the demand for the fruit juice is more but if we consider a particular product out
of the four product which we are taken into consideration are Real, Tropicana,
Freshgold and Saint.
CONSUMER AWARENESS FOR FRUIT JUICES
If we compare the consumer awareness for each brand then it is satisfactory that all
the consumers have the knowledge regarding the fruit juices available in the market.
According to the conversation during filling the questionnaire people drink fruit juice for
energy instead of getting relaxation. It is found that 78% consumer consume fruit juices
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53. for energy. Though the caloric value of fruit juice is high it is consumed for the purpose
of getting energy. The consumer awareness for fruit juice is more among all consumers.
Consumers get aware for fruit juices through different modes
The sources of awareness regarding the product are the T.V., News papers,
Magazines, Websites, Banners etc. It is found that the banners displayed in different
places attract their attention towards the product a lot. Out of 100%, 13% (other) of
people attracted towards the banner advertisement. Television is the most demanded
for getting awareness regarding fruit juices and their changes made time to time. 38%
consumers get the idea about fruit juices from television.
CONSUMER DEMAND FOR FRUIT JUICES
53
54. As from the analysis 85% of people use to take juices daily. Out of which most of
the people do not know about most of the brands which are available in the market, like
freshgold, leh berry, saint etc. They only know about those brands which they use in
their day to day life like Real, Tropicana etc.. The demand for fruit juices increases
because of the growing income of each individual and increase in purchasing capacity.
The change in consumption food habit has really affected the demand of fruit juices.
The brand name has a great influence towards sales. Most of the people say that Real
is the best brand and they will go for Real only, lesser people than Real want to go for
Tropicana and subsequently the demand decreases among Fresh gold, Saint, Leh berry
and others. The various campaigns organized by the fruit juices companied have also
increased the consumption demand for fruit juices. It is obtained from the primary
research that 53% of consumers prefer Real juice as compared to Tropicana, Leh Berry,
Fresh gold, Saint. It is observed that Fresh gold has lesser consumer attracted towards
it shows the lesser demand by consumers according to various parameters which are
explained in the other analysis as followed. Leh Berry and Tropicana has the same
demand in the market because of their retail price in the market for which the
consumers buy it. The promotional factor which has great importance towards the
demand of the fruit juices.
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55. CONSUMERS DEMOGRAPHIC PROFILE AND PREFERENCE FOR FRUIT
JUICES
From the analysis it is found that the fruit juices consumption depends upon
different age groups. During the survey I found that 43% of the consumers of age group
20-30 likes to consume fruit juice. Subsequently 28% consumers from the age group
30-40, 14% people from the age group 40-50, 7% consumers between the age group
50-60, 3% consumers were above the age of 60 where as only 5% consumers were
below the age of 20.
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56. One more thing I got from the analysis of my questionnaire that out of 100% only
62% people like packed juices where as 38% people like juices which is freshly
prepared in front of their eyes by local juice wala. They believe that the packed juices
contains many extraneous substances or ingredients and loose juices are fresh and
contains not any extraneous ingredients or preservatives so that the loose juices are
more beneficial than the packed one. They don’t like the taste of packed juices because
it gives the taste like a cough syrups as they said.
CONSUMER’S PREFERRED BRAND
I conducted a survey among 120 people to know about their preferences, that at
which brand they rely the most. The survey was conducted among five brands
Freshgold, Real, Tropicana, Xs and Saint. Among all these brands most of the people
said that they like Real, Lesser said Tropicana and a very few said Fresh gold and other
brands. As a result of the survey 46% people like Real where as 33% like Tropicana, no
one said about godrej’s Xs and only 5% people said about fresh gold. 16% people like
other brands(saint, leh berry and other local brands) available in the market. Most of the
people whom I met they don’t even know about fresh gold, they came to know about
fresh gold through the questionnaire only.
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58. As per the graph above shown the packaging is divided into four types, i.e. tetra
pack, plastic bottle, can and glass bottle. From the survey it was analyzed that 70%
of people like tetra pack, 18% of consumer like plastic bottle, 9% of consumer like
can and 3%of people like to have juice is glass bottles.
AWARENESS REGARDING THE FRESH GOLD
During the survey when I asked people about fresh gold, most of them have replied
they don’t know about this product available in the market. After completion of
survey when I analysed the primary data collected I got that around 70% people are
there who don’t even heard about fresh gold. Only 30% people were about its
existence. The people who know about this or who have tasted it earlier praised it
very much.
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59. COMPETITORS MARKET SHARE
The competitors market analyzed from the acceptance of particular product or it can
be understood like that-how many customers retained by each fruit juice brand. It is
studied that real has captured the maximum number of customer in the market.
From the figure below- the customer retention can be known.
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60. From the above graph the number of customers retained by each brand can be
known, tropicana has retaines 33% customers, real has retained the most 53%
customers, fresh gold has retained 6% where as saint has 3% and other brands
(leh berry, Xs and many more combinedly ) has retained 5% customers.
Most popular flavour
A survey is conducted among 120 people just to know about their taste preference.
In the questionnaire a question was there about the flavour which they generally
have. I asked among 6 flavours orange, apple, pineapple, tomato, mixed fruit and
other flavours. At the time of analysis I got that 38% people asked about orange
flavour only, which means orange flavour is most popular among other juice
flavours. Orange got 38%, apple got 14%, pineapple got 9%, tomato got 3%, mixed
fruit got 34% and there were people who don’t like any of these, they preferred to
have other flavours.
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61. PURCHASING CAPACITY OF CONSUMER
Although the purchasing capacity of the consumer is increasing on day to day basis in
present sceanario but even though they don’t want to spend more on it. A question was
asked to them that about the price of one litre of juice. Most of the people said maximum
rs 60 for one litre of juice. Around 43% people said that its price should be upto rs 60,
where as 14% said 61-65, 19% were in favour of 66-70, 17% favoured 71-75 and 7%
said that they can pay more than rs 75 for one litre of juice.
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