CASE STUDY – MAKEOVER OF BRITANNIA

INTRODUCTION

The is about Britannia Industries Limited(BIL) , whose business seemed to be

doing well , instead of concentrating on it , virtually charted a new course by
seeking to invent itself. It built a new corporate identity and become a
comprehensive food and beverage company from being a manufacture of baked
products only.

SWOT ANALYSIS

Strength:

 favorable marketing conditions

 major brand name

 loyalty towards the product

 variety of products

 affordable prices

 niche product

 demand in urban and premium segment

Opportunities:
 increasing income of people

 increasing demand

 growing competition

 introduction of new technology

 increasing tie-up and mergers

Weakness:

 limited resources

 too many brands entering the market

 scarcity distributed in rural areas

 non affordable to low income groups

Threats:

 cut throat competition

 increasing no. of players in market

 unpredictable shift in consumer demands

 entry of foreign players in Indian market

 increasing govt. restrictions

  other ready to eat product are coming into the market

ANS 1 .

In volatile markets, it can be necessary - even urgent - to reposition an entire

company. In this highly competitive market Britannia survives because of its
continuous product and marketing innovation. The change in logo and corporate
slogan was crucial for BILS makeover because it was necessary that the company
touched the emotional part of all Indians and enhanced its brand image and market
cap. it was also important for the company to reach the market depth.

From being manufacture of baked products, BILS kicked off a diversification

exercise to become a comprehensive food and beverages company. Therefore
company wanted a logo and slogan that is easily identifiable. Every business has
one, that little graphic displayed on everything they produce. Although a logo may
look just like a stylistic name, it can mean brand recognition to a company. A good
logo helps a company have a clean, professional, polished look. The more clean,
stylistic and original a logo is, the more chance there is that it will stand out from
the competition and help get those extra sales. A logo is a memory tool for
customers that are generally used in a marketing strategy. Humans usually
remember visual items better than plain text alone, so a properly designed logo
gives customers a thing to recall and instantaneously remember while connecting
the symbol with your company. To enables the company to safeguard the value of
our corporate brand and use it to achieve success in worldwide competition.
Slogan is a very important element for a brand because it makes it that much
easier to increase consumer’s retention rate and desire. It is a advertising
statement that describes what your brand is all about. Slogans have an attitude .

With the view of increasing the acceptability and affordability of the brand
company needed an entirely new look which appeals to the consumers
immediately.

The fact that exciting brand was associated to closely with bakery business, could
have become hindrance to BILS diversification efforts. Therefore Britannia needed
a more dynamic expression. So, there was a need to restage the logo and the
brand statement, the exiting red a white shield needed to be changed. The new
logo had three colours red, white and green which collectively represented what
consumers looked for in a brand .it was important that the new slogan captured
the essence of the Indian concept, all the social economic strata in urban and
rural India were adequately represented. The new shield would have made BIL
powerful and communicated innovation and futuristic power of BIL.The new
corporate identity will testify to the implicit quality of all products and colors
stand for things consumer look in all foods and beverages. The new identity was
crucial to lay down the base for successful company.

ANS 2 .

“ for a company that wished to cater a varied customer – base , Bil needed to
posses a large portfolio of brands with different USPS , yet unified under a
uniquely differentiate mother brand .“

BIL followed various different stategies :

Bil repositioned each one of its biscuits brands on a new platform and ensured
that each brand had a base statement making clear the “higher order benefits “ of
the brand . BIl used combinations of price and appeal to staddle every segment of
the market , challenging all levels of competition.

BIL had structured a wide range of price-points: from Re 1 for a sachet of Tidbits
to Rs 12 for a pack of 10 Good Day Pista Badam cookies, to Rs 15 for a 100 gm
pack of Cheezlets. Likewise, BIL had straddled the spectrum of segments with
different product-benefits, all of which only reinforced the mother brand's new
platform. In regard to brand building, BIL followed the strategy of 'brand
clustering'. The strategy was to let 'Britannia' remain the mother brand under
which a cluster of sub-brands would be present for specific product categories.

While the umbrella brand would act a guarantee for the consumers, the sub-
brand was used to give focus and distinct images for its new product categories
and businesses to get economies from brand building.

BIL revamped its biscuit business. At the low-end price-point, was the 'Tiger'
brand, a "calcium-enriched" glucose biscuit launched in 1997, which acted as the
umbrella brand for the mass market. Until then, BIL had focused on the middle
and premium segments of the biscuit market, leaving Parle's Parle G to rule the
mass market. With the mass segment accounting for half of the unorganized
market, it seemed strategically important for BIL to make inroads into the same.

Therefore, as a part of its new plan to attack the mass market, BIL launched the
'Tiger' brand and positioned it as a 'healthforce biscuit' as consumer research
showed that good health was the overwhelming consideration when mothers
chose snacks for their children. Since Glucose had become a generic brand, BIL by
establishing a new brand was clearly differentiating its Glucose biscuits from
others.

The 'Tiger' brand eventually seemed to have been a huge success . BIL then
focused on its core biscuit brands- Marie, Thin Arrowroot, and Milk Bikis-which
faced competition from similarly branded alternatives like Bakeman's English
Marie, Milka Biscuits, and Priya Marie. In order to overcome the competition, BIL
differentiated its brands by bringing them under the 'Eat Healthy, Think Better'
banner and giving them clearly-defined positioning.

For Milk Bikis, targeted at children, BIL launched variants like Milk Bikis Funland,
which were animal-shaped biscuits. Marie was renamed Marie Gold, and
positioned as a tea-time biscuit. Thin Arrowroot was renamed Jacob's Thin, with
its position as the low-calorie health biscuit reinstated. BIL relaunched its low-
calorie, high-nutrition brands-Thinlite, Cream Cracker, and Digestive under the
Nutrichoice umbrella, targeting the fast-growing health-conscious segment. BIL
seemed to be quick in gauging the rising demand for products in the impulse
category of snacks (e.g. chips and chocolates).

Accordingly, BIL came up with trendier products like Little Hearts, Pure Magic, and
Chekkers, targeting the under-24 urban consumer, positioning them with
statements they identified with. For example 'Direct Dil Se' for Little Hearts, 'Full
Of Taste And Fun' for Pure Magic, and 'For The Ups And Downs In Life' for
Chekkers. In 1999, BIL had launched Snax, a line of ethnic snackfoods using low-
fat oils and hygienic processes, in 3 variants: Calcutta Ka Chana Choor, Bikaner Ka
Bhujiya, and Rajasthan Ka Aloo Bhujiya, with an eye on the almost Rs 1800 crore
snack market in India.

In the segment of 'breads' which contributed about 6% of the company's total

revenues, BIL's presence was restricted to a few cities. In the face of increasing
competition, it decided to strengthen its bread business in the southern states
and was seriously looking for acquisitions and manufacturing tie-ups in that
region. It also planned to leverage the key strength of the daily distribution
system of its bread business in its new ventures like milk. With a view to boosting
volumes, BIL also changed its packaging strategy by launching biscuits in small
sachets.

It launched the low-priced sachets, 'Tiger Tikis-nibblets' priced at Re 1-targetting

the mass market. BIL simultaneously revamped its distribution channels,
increasing its retail distribution network to more than 1.20 million outlets. To
increase penetration, more than half of the new outlets serviced, were in the
rural and semi-urban markets-a break from the past, when BIL's distribution was
distinctly skewed towards urban India. As part of its strategy to reduce its
dependence on biscuits, BIL sought to diversify its product portfolio to include
categories that fitted within its overall objective of transforming itself into a food
company. BIL targeted segments where it had the potential of capturing either
the number one or number two position. So the company entered only those
areas which will form part of the daily eating habits of an Indian home and offer
either high volume or high value. Its strategy was to build on the strong affinity
that Indian consumers had for milk and milk products in its diary venture. BIL
wanted to do in dairy products what it has done in biscuits: cover all segments.
ANS 3.

Positioning the Britannia brand as both enjoyable and healthy and diversifying in
various products was a wise move for BIL. Since its inception BIL had been mainly
involved in the manufacture of biscuits, which contributed around 85% of its
revenue. The biggest problem the for 80 year old BIL was that it’s strongly
associated by customers with biscuits. With the de – reservation of biscuits from
the small sector and commoditization of the Rs 3500 crore biscuits market, BIL
had to look for a fresher approach to survive and prosper.

Britannia expanded its activities beyond the core business, biscuits .Biscuit
would remain the prime revenue earner while diversification would work to
achieve a guaranteed growth chart, and this made logic.
Corporate performance

BIL's makeover plan seemed to have worked well. The sales increased from Rs
752.3 crore in 1996-97 to Rs. 1169 crore in 1999-00 and net profits increased
almost 4 times since 1996-97. Although BIL's biscuit business seemed to have
done well. Analysts observed that the value-added dairy market which BIL
had targeted was a minuscule 0.10 per cent of the market. While the size of
the cheese market was a mere Rs 140 crore, it was growing at 20 per cent per
annum. The Rs 400-crore butter market was growing at 10 per cent a year,
and Amul-the only national butter brand-had an 85% share. The Rs 350-crore
dairy-whitener market was growing at 10% a year.

Growth prospects
Britannia believes in its brand assets. So the company hoped to move forward
by ‘making appropriate and needed investments to strengthen them through a
combination of product, packaging and other innovations, right pricing and
strong marketing support’. Britannia biscuits received excellent response.
Moreover, new products like ‘Britannia Cookies’ and ‘Treat Choco Decker’
have also been launched to tap new growth opportunities. ‘Nutri Choice
Nature Spice’ a key thrust of the business has added significantly to new
consumption opportunity out of home.

Resulting from a better product- mix and higher pricing in most markets
export of Britannia brands has registered a growth of 50%. What is probably
more important is that the company has increasingly penetrated into rural
India, which is considered by the FMCG sector as the potential areas of its
future growth. ‘‘We have an increasing presence in rural India — for some
brands more than 50% of our revenue comes from rural market,’’ Ms Bali, the
managing director of Britannia Industries has said.

Britannia diversification isn't out of box thing. It reflects the parent's portfolio
somewhere. Diversification has benefitted BIL owner by increasing the
efficiency of the firm. It had lead to a significant benefit which is minimize risk
and maximizing opportunity.

ANS 4.

BIL entered the dairy segment in 1997 with cheese and milk powder or dairy
whiteners. By 2000, BIL captured about 35% of market share of the cheese
market and 20% in the dairy whitener segment. It launched butter in 1998,
flavoured milk, sub-branded 'zipsip' in tetra packs in 1999 and ghee in February
2000.The company followed the strategy of umbrella branding for its different
brands .

By using corporate branding with a successfully marketed product, a company can

familiarize consumers with its products and may create brand loyalty. If the public
likes one product from this company, then they may seek out the brand name
when buying other products. But umbrella branding often leads to that company
becoming identified with only one type of product. To consumers, corporate
branding represents a level of quality that they have come to expect from the
company. They will expect every product with the same brand name to have the
same level of quality that they are familiar with.

Launching the dairy products under the same umbrella branding could have also
led to BRAND DILUTION which means that consumer do not associate a brand
with specific product because from ages Britannia has been associated with only
bakery products . Consumers could have questioned the integrity and
competence of the brand. Different varieties of brand confuse and perhaps
frustrate the consumer.

The worst possible scenario is that, the dairy products could have failed and led to
a lot of harm being caused to the parent brand image.

BIL wanted the consumers to believe that its core competence was food and that
by going into dairy products, it was not moving from its original business.

The company realized that by introducing a new product as a brand extension,

the company was forgoing the chance to create a new brand with its unique
image and equity. Consumers easily associated themselves with the brand name
MILKMAN and a company that provided high quality and tasty, yet healthy foods
and beverages.
ANS 5.

Following are the future course of action:

1. BIL should put more marketing efforts to make consumer aware of brand's low
prices and more nutrition conscious for understanding of newly introduced the
glucose biscuits.

2. Sponsor the Mid Day Meal program by partnering with National Literacy
Mission in India".

Britannia should sponsor the mid-day meals in schools by providing them with
Milk Bikis, partnering with National Literacy Mission in India. This would be a
great Corporate Social Responsibility initiative. This will show their contribution
for nurturing the children and future of the country.

3. maintaining the price and concentrate on the brand taste

4. Differenciating brand according to regional disparities so that the consumer can

identify more with it.

5. Heavy advertising to create consumer pull and be allowed to charge a

premium.

6. Advertisement emphasizing the product quality and nutrition value

7. Cutting overheads

8. Increasing the brand equity.

9. Ensure that the product made is acceptable to Indian taste.

If BIL was to achieve the objective it has set for itself, it has to continuously strive
to deliver with value which exceeded consumer expectations. BIL long term
success would ultimately depend on whether the consumer liked the new product
it introduced in the market or not.