Introduction to ITC Establishment

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Incorporated on 24 August 1910 as the Imperial Tobacco Company of India Limited, the company's name was changed to ITC Limited in 1974. Rated among the 'World's Best Big Companies' by Forbes magazine, ITC ranks third on all major profit parameters among India's private sector corporations. ITC employs over 20,000 people at more than 60 locations across India. It has a turnover of $3 billion.

Growth and Diversification:
ITC is one of India's foremost private sector companies with a market capitalization of nearly US $ 18 billion and a turnover of over US $ 4.75 billion. ITC is rated among the World's Best Big Companies, Asia's 'Fab 50' and the World's Most Reputable Companies by Forbes magazine, among India's Most Respected Companies by Business World and among India's Most Valuable Companies by Business Today. ITC also ranks among India's top 10 `Most Valuable (Company) Brands', in a study conducted by Brand Finance and published by the Economic Times. ITC has a diversified presence in Cigarettes, Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business, Packaged Foods & Confectionery, Information Technology, Branded Apparel, Personal Care, Stationery, Safety Matches and other FMCG products. While ITC is an outstanding market leader in its traditional businesses of Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports, it is rapidly gaining market share even in its nascent businesses of Packaged Foods & Confectionery, Branded Apparel and Stationery. As one of India's most valuable and respected corporations, ITC is widely perceived to be dedicatedly nation-oriented. Chairman Y C Deveshwar calls this source of inspiration "a commitment beyond the market". In his own words: "ITC believes that its aspiration to create enduring value for the nation provides the motive force to sustain growing 1

shareholder value. ITC practises this philosophy by not only driving each of its businesses towards international competitiveness but by also consciously contributing to enhancing the competitiveness of the larger value chain of which it is a part." ITC's diversified status originates from its corporate strategy aimed at creating multiple drivers of growth anchored on its time-tested core competencies: unmatched distribution reach, superior brand-building capabilities, effective supply chain management and acknowledged service skills in hoteliering. Over time, the strategic forays into new businesses are expected to garner a significant share of these emerging high-growth markets in India. ITC's Agri-Business is one of India's largest exporters of agricultural products. ITC is one of the country's biggest foreign exchange earners (US $ 2.8 billion in the last decade). The Company's 'e-Choupal' initiative is enabling Indian agriculture significantly enhance its competitiveness by empowering Indian farmers through the power of the Internet. This transformational strategy, which has already become the subject matter of a case study at Harvard Business School, is expected to progressively create for ITC a huge rural distribution infrastructure, significantly enhancing the Company's marketing reach. ITC's production facilities and hotels have won numerous national and international awards for quality, productivity, safety and environment management systems. ITC was the first company in India to voluntarily seek a corporate governance rating. ITC employs over 21,000 people at more than 60 locations across India. The Company continuously endeavors to enhance its wealth generating capabilities in a globalizing environment to consistently reward more than 3, 88,000 shareholders, fulfill the aspirations of its stakeholders and meet societal expectations. This over-arching vision of the company is expressively captured in its corporate positioning statement: "Enduring Value. For the nation. For the Shareholder."

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Mission & Vision

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Mission
To enhance the wealth generating capability of the enterprise in a globalising environment, delivering superior and sustainable stakeholder value

Vision Sustain ITC's position as one of India's most valuable corporations through world class performance, creating growing value for the Indian economy and the Company’s stakeholders

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Nehru Road Kolkata – 700071 India 5 .L. B Vijayaraghavan • Non Executive Directors: Registered Office ITC LIMITED 37 J. Basudeb Sen 9. S H Khan 3.Key People • • • • • • Chairman: Y C Deveshwar Executive Directors: Anup Singh and K Vaidyanath FMCG Businesses: K N Grant Hotels & Travel: Nakul Anand Finance: Rajiv Tandon R&D. R K Kaul 2. Projects. D K Mehrotra 5. S B Mathur 4. H G Powell 6. P B Ramanujam 7. Anthony Ruys 8. EH&S: T V Ramaswamy 1.

000 snack items and 300 types of savouries are sold across India. Though very large and diverse.200 crore. The variety is almost mind-boggling with specialties from all regions.INDIAN SNACKS INDUSTRY: An Overview Snacks are a part of Consumer Convenience/ Packaged Foods segment. while the branded segment is growing around 25% per annum to stand at Rs 5. The branded snacks are sold at least 25% higher than the unbranded products. Snack is described as a small quantity of food eaten between meals or in place of a meal. which have gained national acceptance. In the branded snacks market.000 tonnes in terms of volume. normally they are consumed at teatime. snacking at home while watching TV. The industry has been growing around 10% for the last three years. the snacks industry is dominated by the unorganized sector. 6 . Frito Lay commands a share of 45%.000-Rs 5.500 crore.00. since almost ages. followed by Haldiram’s at 27% and ITC at 16%. namkeen and other light processed foods According to the ministry of food processing. the snack food industry is worth Rs 100 billion in value and over 4. regional bias towards indigenous snacks and good value-for-money perception. The rest is divided between a handful of new entrants. According to an Apeda survey almost 1. pubs and bars (where they are served free). chips. Snack food generally comprises bakery products. which is what makes it so attractive to food Companies that are looking at bigger shares. Savoury snacks have been a part of Indian food habit. Of course the branded segment is much smaller at Rs 2. due to various reasons like Multiplex culture. Though there is no particular time for snacks. ready-to-eat mixes. AC Nielsen's retail audit shows that the large sales volumes are due to a marked preference for ethnic foods. wannabes and many regional players. to get down to basics.

Pepsi Foods Ltd. Many snack foods are sold loose or packaged in poly-pouches. or in some cases. which may only be folded. The potato chip market is generally an unorganized industry. Hostess. according to India Infoline. There is also no uniform standard for packaging. Frito Lay's story is an example of how American recipes were adjusted to satisfy local tastes. Cheetos and Uncle Chips. unlike many other potato based Indian snack foods that are fried.. P&G currently imports the Pringles product and therefore the product has been priced at a premium and is marketed to a micro-niche.. including Ruffles. Procter & Gamble's Pringles brand of potato crisp was launched in Delhi in 1999. and production standards improve. Nearly all potato chip snack products are manufactured and sold locally. as there is in Europe. many snack food companies are making significant investments into plant equipment and packaging machinery. now known as Frito-Lay India Ltd. the United States and other more developed regions. 7 . Pringles is also a baked potato crisp.Of the wide range of snacks available. stapled closed. produces India's largest snack food manufacturers brands. As the Indian economy continues to grow. potato chips constitute a sizeable segment of the Indian snack food industry.

In May 2006. biryanis (Noor Mahal. By early 2006. some new products have been launched under Ready To Eat category like chutneys. However. Bhori 8 . 98. READY TO EAT ITC entered into the branded and packaged foods business in with the launch of Kitchens of India brand. Switzerland. MTR was the clear market leader with close to 60% in market share. As on April 2006. entry to this business is easy and ITC has utilized this fact very efficiently to their benefit as they entered into the several categories among this Foods business. they are trying to prove themselves different through their marketing strategies. There are many competitors in all the categories and although they all have similar products available at similar prices. the total turnover in the Indian ready-toeat and ready-to-cook segments was only around Rs.30 for a 100g pack.Market and Competition Indian Foods market is a monopolistic market. ITC entered the branded spices market in 2005 and the Instant Mix segment in 2006. a food expert. conserves. both under the Aashirvaad Brand. ITC exported 40-50% of KoI brand products (in terms of volumes) to the US. Multi-purpose cooking pastes were also launched under the Aashirvaad brand and these were priced at Rs. 10 for 80g pack. also targeted the high-end market. ITC planned to introduce ten more varieties under the KoI brand within a price range of Rs. curries. the company launched KoI brand fruits and spice conserves and cooking pastes. the UK. 35 to Rs. 700 million. and Australia. Canada. were developed jointly with Karen Anand. though ITC had captured a 35% market share in the ready-to-eat segment. In 2007. but it continued to post an annual growth of 20%. In 2004. these were targeted at the premium segment. which were priced at Rs. 70. The manufacturing of these products was outsourced to contract manufacturers for saving the operating cost. Priced at Rs. The KoI cooking pastes. The fruits and spice conserves.

Biryani and some new range of products under Gharana (Paneer Malai. Dhokla among others Offers packaged sweets. Gol Gappa. Alu Tikki. Navaratan Kurma to Palak Paneer. gravies and rice.Ready To Eat 9% 8% 48% ITC Ltd. 2009 9 . After launching all these products ITC FOODS is looking to share 50 to 60% of market by 2008-2009.namkeens. Samosa. cookies.syrups. Priya has a range of popular traditional recipes starting from Dal Makhani.) as on June. Punjabi Chhole and Rajma Masala along with true southern delicacies like Andhra Veg Pulav. MTR Kohinoor 35% Others(Gits. Offers packaged Bhel puri chats such as Sev Puri. Mango Dal. Bhujia.Following are the major competitors ITC is competing with in Ready to Eat category: Brands Gits Description Gits produces the selected range of popular ready to cook and instant foods that cover a range of ethnic Indian cuisine-and where the recipes have "Global pallete acceptance". Paneer Butter Masala. Kajui Ladoo and many more items. Gongura Dal. Haldirams Ethnic Kitchens MTR Priyafoods Market Share . Priya Foods etc. Keema Mutter). Chana Dal. Pao Bhaji. MTR foods currently comprise twenty-two delicious and completely authentic Indian curries. Chana Masala. Bhelpuri. aloo Masala. pickles. Pakoras.

2500 crore.3% with chloromint.) 3% as on June. HUL etc.Confectionery ITC Ltd. Chewing gum 5. Bubble gum 6. lozenges ITC has currently in market with its two brands “Mint-o” and “Candyman”.CONFECTIONERY Confectionary market in India is about Rs. ITC’s Mint-O fresh secured a 17% share of Indian cough lozenges market ahead of former leader Perfetti which only achieved 14. Perfetti Van Melle 42% 37% Cadbury Nestle 7% 11% Others(Parle. Eclairs 4. Toffies 3. Joyco. But in overall confectionary market they are lagging behind having just 3% market share as compared to market leader Perfetti with more than 37% market and providing larger number of brands. Market Share . 2009 10 . The Indian giant marked the confectionary sector in 2002 and has only two brands “mint-o fresh” and “Candyman”. It is loosely divided into seven categories: 1. Mints 7. Hard boiled candies 2.

they are able to get 12% share of the market. 50 50.Biscuits 8% 12% 10% ITC Ltd. ITC with its premium product. the balance 40% being contributed by the unorganized bakeries. SUNFEAST. Biscuit industry in India in the organized sector produces around 60% of the total production.) as on June.BISCUITS Indian biscuit market is estimated to be around 5000 crore. Milk Bikis Good Morning. is acquiring a big share of market. Priyagold Britannia Parle 32% 38% Others(Bonn. ITC Ltd (Sunfeast) Marie Dream cream Milky Magic Fit kit Choco Nut Butter Nut Parle Parle-g Krack-Jack Monaco Kreams Hide and Seek Milk Shakti Priyagold Butter Bite Classic Cream Butter Lite Big Boss Marie Lite Magic Gold Market Share . Anmol etc. Treat Pure Magic. Within few years. Britannia Tiger Nutrichoice Junior Good Day.2009 11 .

BINGO! No Confusion Great Combination 12 .

Before the Launch Research: After making the decision to launch Bingo it started by sending a crossfunctional team of eight individuals were sent across the country to research the snacking habits of the Indian consumer. Kurkure and Uncle Chipps holding 50 per cent of the market share. 13 . building on consumer insights and high decibel advertising can win the game. offering the consumers a choice of flavours that are fast becoming popular.000 people. the team came back with an insight that Indian consumers were looking for novelty and excitement in existing snacks. The company leveraged its existing distribution network and relationship established with farmers. Bingo’s portfolio includes an array of products in both Potato Chips & Finger Snacks segment. This was an extremely ambitious target according to observers as the market was dominated by the Frito Lay group (owned by Pepsi Co) with a slew of brands like Lays. The launch is symbolic of ITC Foods' distinct approach of introducing innovative and differentiated products in a largely undifferentiated market place. Its earlier foray into categories like atta and biscuits had already given it access to the supply chain.About Bingo The Bingo brand of chips was launched by ITC on 14th March 2007 with an aim to capture at least 25 percent market share of the Rs 2000 crore branded snack market within five yrs. The other was the Haldiram group with 25 percent of the market share. Bingo used combination of leveraging synergies. The idea was to get the consumer to take that first bite. After travelling to 14 cities and speaking to more than 1. Bingo’s launch was strategically timed around the World Cup. Bingo! is positioned as a youthful and innovative snack.

Taste: For the recipes. Bingo has a unique musical sound that is loved by everyone. which allows it to stock its products in shops that previously did not sell snack food.cheese balls.The team found that while vada pavs and samosas still sell vada pav with cheese and paneer-filled samosas. ITC Foods provides shopkeepers with plastic molded shelves that allow local vendors a convenient way to stock their product. The chefs came up with 16 flavors with innovative twists like bindaas masti chaas. Based on this information. The organized snacks category is subdivided into the Traditional segment (Bhujia. ITC has launched an aggressive marketing campaign to gain entry into and capture a sizeable market share in the extremely competitive world of snack foods. tomato-flavored khakra were the ones that excited the Indian consumer.puffs etc) and the Finger snacks segment which is an adaptation of traditional snacks to the western format.Chana etc) dominated by Haldiram. The second category is the Western segment (potato chips. This property of flavor depiction is very informative for consumers and a layman can also associate with it. and the company benefits by increased visibility for its brand. Bingo’s success in the market is backed by ITC’s strong distribution network. crimp border colors and a pictorial view of the flavor. It is one of the properties that are remembered by everyone and it is used to recall the brand by every age group. the company went to the chefs in its hotels. Additionally. 14 . chilli and tomato-flavored mad angles — inspired by khakras — and other snacks. chatkila nimbu achar and tandoori paneer tikka-flavoured potato chips. The latter two categories are dominated by the Frito Lay group. the company decided to look at chips with innovative flavors. The packaging is very attractive with dominant variant color. or for that matter.

20 15 . 10 Rs. 5 Rs. 5 Rs. 10 Rs. 10 Rs. 20 Product Price (Frito Lay) Lays Rs. Frito-Lay • • • • Lays Kurkure Uncle Chipps Cheetos 2. 10 Rs. 5 Rs. 20 Kurkure Rs. Haldiram 3.Main Competitors: 1. 20 Uncle Chipps Rs. 5 Rs. Regional Players like Balaji Comparison of Prices: Product Price (ITC Ltd) Bingo Rs. 20 Product Price (Haldiram) Namkeen Rs. 10 Rs.

The Potato Chips offerings include Salted. Masala and Tomato flavours. Chatkila Nimbu Achaar. Bingo! – International Cream & Onion is the brand’s latest addition to its existing unique and exciting range.Product Portfolio Bingo provides innovative finger foods like the pakoda inspired Live Wires. Value Proposition • • • Variety & innovation in a largely undifferentiated Variety & innovation in a largely undifferentiated market. 16 . etc. Foray into the “Health Snacks” segment by introducing Bingo as baked-chips. Khakra inspired Mad Angles and time pass snack in the form of Tedhe Medhe. ITC launched BINGO in 16 flavors to cater to tastes of the country.

Strategic Analysis 17 .

Apart from it has also launched packs with different quantity keeping in mind the specific consumer demand. Price 18 . 2.Assortment of flavours and eye catchy packaging. For the South Indian market. Tikka.Widespread availability at big and small retailers across the country.ITC has done the packaging such that the product attracts the buyer. Place . The Potato Chips offerings comprise of four innovative variants inspired by the snacking habits of different parts of the country as well as Masala. Salted and Tomato flavors. The initial offerings from Bingo include an array of products in both Potato Chips & Finger Snacks segment. Product Bingo! positioned itself with its Indian flavors such as Tandoori Paneer. Bingo! had flavors such as Chatkila Nimbu Achaar. The offerings under the Finger Snacks segment are equally unique presentations with innovative finger foods like the pakoda inspired Live Wires. 2.Pricing Strategy 3. Advertisements 1.T. Khakra inspired Mad Angles and the specially developed time pass snack in the form of Tedhe Medhe. 4. Packaging. Each offering under this segment is available in two variants making it a total of 6 products in the Finger Snacks portfolio. Promotions . who are willing to try out new flavors more easily than the small kids. Achari Masti etc. The segmentation was mainly done on basis of the age of the people. The primary target for Bingo is 18-30 year old people.Major Strategies Adopted by ITC for Bingo 1 Product . Spice Paneer etc. Additionally a dairy option has also been introduced under the potato chips offering.V. Price .

ITC’s printing and packaging business provided high-quality. Big Bazaar. ITC has made a strategic alliance with Future group according to which all retail stores of Future group like Food Bazaar. This helped ITC to compete with the best. to display the brand at all points of sale. Now Frito Lays has launched small packs of Rs 3 each.50.000 retailers across the country. Initially Bingo sponsored many Bingo Remix nights in various clubs as well. cost-effective. 4.When ITC launched Bingo. and Kishore Biyani’s Fair Price etc will stock only ITC’s Bingo. The racks created so much impact that even competitors like market leader FritoLays introduced its own version of wafer racks. Promotion 19 . Bingo was available in more than 2. The Company has distributed more than 4 lakh large racks. 10 and 20. Place ITC has adopted a Market Challenger strategy with the launch of Bingo! and has chosen a combination of flank and frontal attack against the market leader Frito Lay’s. they planned to capitalize by leveraging the strength of the group’s other businesses. To do this. 3. Initial pricing of ITC bingo is a direct frontal attack on Frito Lays with pricing of Rs 5. and innovative packaging. ITC realized that they have to offer products at a price which is either equal or less than what the competitors are offering. To overcome this challenge. its main challenge was to compete with the players who were already there. ITC also enjoyed cost advantages over its competitors owing to its electronic procurement system called e-Choupal. entire cigarette distribution network including betel shops are being used to distribute the product to a wide range of consumers. It needs to be seen whether ITC can leverage upon its huge distribution network to counter this. Within six months of the launch. restaurants and cafes). HORECA (hotels.

Bingo!’s advertising follows the AIDA model (Attention. mass Hindi channels like Zee and Star TV. ringtones and videos promoting the same. Bingo! Mad Angles Twister is a crazy application with which can turn the status messages upside down on facebook which can make the users and viewers go crazy trying to figure out your secret of that twisted message. and news channels. On television. Not only the flavours but also the advertising was supposed to have an Indian touch. over 1. And that is why they are so funny. the company booked 10 to 15 spots per channel per day on youth channels such as MTV and Star World. The clutter-breaking ads with their slapstick humour and irrelevant themes garnered enough eyeballs to create awareness of the product and generate an interest towards the product in the minds of consumers. What’s interesting is the fact that Lays uses a brand ambassador approach with the celebrities having mass appeal such as Saif Ali Khan. It still doesn't have an ambassador.T. Juhi Chawla & M S Dhoni whereas Bingo has managed to do well without one. Desire. 70% of the viewers could recall the brand thus capturing a share of the mind of the consumers. Within a month of the launch of the initial advertisements.000 outdoor hoardings advertised the product. 20 . It also had around 20 spots on a variety of radio channels and advertised in most leading national dailies. In the top-30 cities. This resulted in high product trials. Action). AD Campaign: Bingo’s launch was strategically timed around the World Cup to cash in on the tremendous popularity that such leisure and cocktail snacks would find among cricket lovers in the country. So this was another kind of strategy being used for promotional purposes apart from advertisements . Brand recall along with 16 flavors in three SKUs helped ITC to capture 16% of market share in just 18 months. According to industry estimates.V. The idea was to get the consumer to take that first bite. ITC spent close to Rs 100 crore on marketing. The ads are simply insane & nonsensical to the point of being bizarre & utter crap. Interest. The advertising strategy used humour to sell Bingo.

only great combinations). and relevancy with the brand helped in establishing the brand Bingo. Marketing Guru's call it "Disruptive Advetisement" This is one those cases where advertisement/promotion has been the biggest factor in the success of a brand. Is the fact that ITC spend close to 3 years researching. The fact that ITC has a well established distribution network has also helped it increase consumer interaction points.No confusion. cheesy & non-sense jokes. they were relevant and totally associated with the brand image (which was also present in its tagline . The adverts which were full of humor. finding and analyzing the Finger snack segment to come up with its own indigenous variety responsible for Bingo's success The 'insanity' in Bingo's promotion is a carefully knitted strategy that was instrumental in Bingo's instant success. ITC finally tasted success in Bingo in 2008 when it became a profitable business for the first time since its launch in 2007. Major Hurdles faced by Bingo • • • • Brand Loyalty of Lays customer is posing threat to Bingo Stagnant Market Share Unawareness of the variety of flavours introduced by Bingo Threats of local players 21 . With the help of all the above strategies. While I agree the theme of the adverts were irrelevant from the product point of view.Bingo has managed to do a dent in Lays market share.

MARKET WARFARE FIRTOLAY (PEPSICO) AND BINGO (ITC) 22 .

Bingo Remix Nights were held in clubs across the country.500-5. a limited edition variant in two flavors—Risky Chilli and Electric Nimbu (lime). Kareena Kapoor etc. 23 . • Since Bingo was a youth brand. • Lays has revamped its branding strategy with new promotions featuring actress like Juhi Chawla.000 crore of which branded players account for Rs 2. • In order to add further zing to its product portfolio. The Bingo National Gaming Championship was one such example. in January 2008. About 35 AC BEST buses in Mumbai and metro in Kolkata are now branded by Kurkure. The snack food market is growing at 30 per cent annually and foods and beverage giant Pepsico’s Frito Lays is the dominant market leader with a market share in excess of 80 per cent.• Currently. in Indianized flavors like Tandoori Paneer Tikka (spiced cottage cheese) and Chatkila Nimbu Achaar (tangy lime pickle). the company launched Kurkure Xtreme. which was launched in March 2007. The event was held in four cities and saw participation from 25.000 crore. the size of the snack food market is estimated to be Rs 4. digital media was used heavily for promotions. This was perhaps a move to outdo competition from ITC’s snack brand Bingo.000 contenders.

Value Chain & Porter’s 5 Forces Model Value Chain Analysis Of Bingo Chips 24 .

Competitive Advantage (1980).The value chain is a systematic approach to examining the development of competitive advantage. The organisation is split into 'primary activities' and 'support activities. The 'margin' depicted in the diagram is the same as added value. The chain consists of a series of activities that create and build value.' Primary Activities 25 . E. It was created by M. Porter in his book. They culminate in the total value delivered by an organisation.

Bingo has its own vehicles for carrying the goods which reduces its cost of transportation. ITC spent around 50 lakhs for advertsing Bingo chips through web. Support Activities Procurement. and they need to be sent along the supply chain to wholesalers. Since the factory is located in National Capital Region which itself is a big market for snack lovers. Bingo receives its raw materials from potato vendors from the plantation area. Goods are moved around the organisation.Inbound Logistics. Operations This is where goods are manufactured or assembled. ITC has started the campaign for providing education to the school children. Bingo also launched many online games to spread their product to people who were below 25 years. 26 .it has tie ups with many retailers .Bingo also went online and opened their own website. Outbound Logistics The goods are now finished. opened many outlets and mass media campaign through actors .heavy advertisements done during the cricket world cup 2007. Here goods are received from a company's suppliers. Service Bingo has varied flavours which caters to the needs to all the types of customers in the country. Bingo chips has a big factory unit at Gurgaon where FritoLays also has a factory. retailers or the final consumer. They are stored until they are needed on the production/assembly line. Marketing and Sales Bingo promoted its products through many promotional events.

These are the qualities which will help us remain contemporary and relevant at all times. and ePurchasing (using IT and web-based technologies to achieve procurement aims). Together. Customer Relationship Management (CRM). services and materials. Companies need to innovate to reduce costs and to protect and sustain competitive advantage. In turn.This function is responsible for all purchasing of goods. to set their own goals and win in the market place. This could include production technology. They will be responsible for outsourcing (components or operations that would normally be done in-house are done by other organisations). lean manufacturing.000 farmers for spices and wheat procurement. passion. Its e-choupal model for direct procurement is also well known. Who believe that the future belongs to those who are able to create it. This kind of rural pedigree is hard to beat. Technology Development Technology is an important source of competitive advantage. The management believe that the most enduring way to retain talent is to enable the people to continuously add value to themselves. Internet marketing activities. ITC encourage those who are eager to take the initiative to continuously learn and experiment. The aim is to secure the lowest possible price for purchases of the highest possible quality. to experiment. ITC’s procurement and manufacturing synergies across divisions have helped it to reduce costs for Bingo as well. Human Resource Management (HRM) ITC build business leaders who create value. Which is why it values integrity. creativity.Bingo uses poly bags which contain the chips. a 'will do' attitude and the will to succeed above all else. 27 . these empower the prople to take risks. under which ITC partners with over 100. and many other technological developments.

Towards this end. The snack can be organised in a well fashioned way. We keep our work environment simple. we continuously strive to unleash the potential of each individual. We leverage human capital for competitiveness by nurturing knowledge. We value ideas and give people the space to execute them. competencies. We keep our people intellectually stimulated and give them the freedom to take their own decisions. Hence the manufacturers can produce Bingo chips in large numbers. We believe it is these strengths that will help us successfully compete in a globalised environment and exploit emerging opportunities. meritocracy. tasks and processes and link all these to our long-term goals. informal and flexible with a strong emphasis on human values. Porter’s 5 forces model for Bingo chips 28 . ITC has one of the best infrastructure in the world for food products. entrepreneurship and creativity. We have remained a vibrant company for nearly ten decades now because of our ability to manage change proactively and to reinvent ourselves continuously without compromising the ideals and values that have sustained us over the years. Firm Infrastructure. We take an integrated view of structures. equity and the upholding of company values. We reward the will to succeed and the desire to compete with the best in the world. We stimulate the drive to be the best and take immense pride in being Indian. Our performance management systems focus on performance. And the responsibility to make ITC grow through innovation and experimentation.At ITC we believe that our mission to enhance value creation for the stakeholder can only be achieved through the quality and commitment of our people. Since bingo is a product of ITC which contains the huge varied products in its factory .

Also the cost of chips of various companies like FritoLays are similar to bingo. Bargaining power of supplier: 29 . ITC may face new threat from Parle. The new entrant may penetrate the market by reducing the price. ITC has not yet conquered the market and hence there are chances that the new entrant may enter in to the scene.Threat of new entry: Since snack products is a growing market .Britannia who have tried their hand in selling Biscuits.

More people are trying our products and we will continue doing activities to generate more trials. east and north and is now in the process of replicating it in the south. the bargaining power of the buyer will be Competitive rivalry: Frito Lays has started a website(www. which are at various stages of development and completion. Though he refuses to give details. It cannot bargain the price to the consumers since it has not achieved the significant percent of market share in the snack industry.in) to engage people to participate in public forum and online games . Mayank Shah. It has increased its content by 50 percent to create a new taste among the customers. or to raise the costs of the industry in other ways. Bargaining power of buyer: Since bingo chips has 13 percent market share . But Parle and Frito Lay can hardly afford to under-estimate Bingo.kurkure. the company asked the chefs at its hotels to suggest 16 flavours with twists like bindaas masti chaas. it is keen to provide good service to the customers and increase its market share. Since the snack market has a demand from the customers through out the year.co. Dar says the company has several other surprises up its sleeve. 30 . has the ability to shake up the market. This is an attempt to indirectly drag the customers towards the product.The bargainign power of the supplier refers to the ability of the suppliers to raise input prices. Bingo is weak in providing the supplies to the retailer or the wholesaler. says. Parle Products. Since variety is the core of a snacks brand to retain consumers’ interest. But Bingo has tough competition from Parle which is now eying a 25 per cent market share through an aggressive marketing and distribution strategy. Group Product Manager. analysts say Bingo.” Parle has increased the volume of Musst in west. which is already worth Rs 400 crore. “We have witnessed good demand for our snacks.

for example. Bingo has not penetrated in to the market and there is a chance of being substituted by the other products. Rediff and Sify. The site was advertised with banners on websites such as Yahoo!. downloads and even mobile games. Marketers call this ‘crowd sourcing’. followed by snack nuts.and other snacks. Bingo also ensured that it reached its audience through every possible medium. Analysts believe the Bingo story is also about well-leveraged distribution. Consumers were asked to design the ads for Bingo using the angular shape of the chips as the central theme.chatkila nimbu achar and tandoori paneer tikka-flavoured potato chips. It first created a website www. The second part of the variety came through irreverent and fun campaigns. With TV ads and online forums . distributed more than 400.000 large racks. The importance of Bingo is evident from the fact that potato-based snacks are the largest product segment (85 per cent share) in the Indian snacks market. The racks created a huge impact.com with offers. chilli and tomatoflavoured mad angles . Threat of substitution: Kurkure may be considered as a substitution product for bingo. chickpeas and other pulse-based savoury snacks. online games. to display the brand at all points of sale. Kurkure has advertised heavily to attract customers. The company.bingeonbingo. which serves two purposes — it engages the end-consumer and the campaign is done at the lowest possible cost.inspired by khakras . Also the various flavours 31 .

SWOT & PEST Analysis SWOT ANALYSIS 32 .

STRENGTHS: • • • • • Availability of Raw materials Availability of Manufacturing facilities Domestic markets Urbanization Catering the market distribution WEAKNESSES: • • • • • Insufficient infrastructure In-prominence in quality control. overcoming stiff competitions from Multinationals like FritoLays and Pringles. Moreover the distribution centers of this age old company is available with experience that can easily absorb the current trend in the market and the taste of the customer can be annotated without much negotiation. The diversified presence in various industries viz. food processing etc makes the base of the company stronger. primarily the Tobacco industry. so does the opportunities to threats. The strengths of the Brand is readily overshadowing the weaknesses.. and this invariably adds as a biggest strength to the BINGO brand. Stationaries. and various other brands. Tobacco. This as an added advantage can prove ITC to be an Indian Multinational company though. the company should not conclude on this cold base to enjoy the benefits in the hand.ITC. the brand owner of Bingo. National competitors and the local products. is strong enough to compete with global players. rather a focus on the minor weaknesses and threats should lead to a path that paves way for the possibilities of being a brand leader. But. unable to meet the international standards High working capital Lack in innovation on variants Large number of intermediaries thus causing a slog in distribution 33 .

OPPORTUNITIES: • • • • • Change in consumer patterns Rise in income level of customers Change in lifestyle and demographies Opening of new international markets Integration of new technologies THREATS • • • • • Prevalence of cultural taste brands High taxation Inventory cost Stiff competition with regional players Close competing Multinational brands 34 .

business position. The analysis examines the impact of each of these factors (and their interplay with each other) on the business. and can in addition to SWOT and Porter’s Five Forces models. The results can then be used to take advantage of opportunities and to make contingency plans for threats when preparing business and strategic plans. but these themes can easily be subsumed in the others. The use of PEST. business and product development and research reports. environmental and legal. helps to break free of unconscious assumptions. 35 . PEST analysis is a useful strategic tool for understanding market growth or decline. including marketing proposition. and help to effectively adapt to the realities of the new environment. Sometimes two additional factors. POLITICAL The ITC brand is a house hold brand in India. The use of PEST analysis can be seen effective for business and strategic planning. PEST is useful when a company decides to enter its business operations into new markets and new countries. The headings of PEST are a framework for reviewing a situation. PEST also ensures that company’s performance is aligned positively with the powerful forces of change that are affecting business environment. that is merely a framework that categorizes environmental influences as political. in this case. potential and direction for operations. social and technological forces.PEST ANALYSIS PEST analysis is one. marketing planning. be applied by companies to review a strategic directions. will be added to make a PESTEL analysis. economic. The political scenario in India is such that the open invitation to the MNCs to be a part of Indian Snack Industry and on the other hand the government is conservative in Indian brands too.

The product profile.ECONOMICAL ITC rightly introduced Bingo in the market when there was less or no supply for Lay's in the market for a prolonged time. The same worked when the Mom-and-Pop stores across the country agreed for the trendy display of Bingo. TECHNOLOGICAL The close competitor of Lay's which banks on the sentiment of being trendy and cool. in longer run may be truncated by keeping those products that doesn't market well. Bingo has special variant which is baked and non fried variety of chips that can prove to be against trans fat in its covers. they developed this product. With this way. 36 . Thus to satisfy the customers in their taste and demography. each specially made for the respective demography. SOCIAL To cater the Indian demography is a herculean task with taste spread all over the country. though with a larger market share of 45%. Bingo offers sixteen variants.the advertisements were gived a keen focus. is running behind Bingo in Innovation they incorporate with the product. This in turn will not fail to attract those people who consider themselves to be strict against the usage of oily snacks.

Conclusion & Recommendation Conclusion 37 .

• Flavours: 38 . Gift packs or combos with 4-5 flavours can be introduced. Now its time to focus more on taste and variety of flavours. tempting the consumers to purchase the product. Usage of different colors for packaging will be helpful as the customers will be able to differentiate among various products. Can tie up with beverages like Coca Cola during festive season or can sponsor events like cricket tournaments etc. In the coming years it will become a dominant player in the domestic market. An animated character can be used to describe the flavour. Bingo is in the growth stage of its life cycle. Recommendation • Brand Packaging: Bingo can come up with different shapes of packaging. Given more time it is capable of capturing a larger market share and giving tough competition to other brands.Although Frito Lays is the most popular brand Bingo has carved a niche for itself. Different packaging always attracts consumers. Its focus is more on product innovation and distribution and invests heavily in promotion. • Advertising: The existing advertisements have been successful in creating brand awareness. • Brand promotions: Company can opt for seasonal promotions.

This would reduce the problem of confusion amongst the consumers. the ones which are not going good in the market should be removed from the company’s portfolio. 39 . • Contests The company should launch a contest like “Send in your Bingo recipe” which can help the company to increase its market share. Even though it’s a good strategy as people are forced to try each flavour.Having too many flavours is causing some problem because the customers are not able to differentiate between different variants.

ANNEXURE 40 .

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bingeonbingo.financialexpress. www.com 7.indiatimes.com 8.com 3. www.org 5.allbusiness. www.google.com/news/Just-munch-it/271873/0 4.Bibliography: 1.com 43 . www.itcportal.com 6. www. www.moneycontrol.wikipedia. http://www.economictimes. www.com 2.

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