PSDA

Principl
es of
Consum
er
Project Report on Amul
Behavio
r

Member-
Mrigesh
Mohanty
(A310462003
6)
Yash
Aggarwal
(A310462000
7)
Shibayan Paul
 (A310462000

➖ ABOUT AMUL
 It all began when milk became a symbol of protest.
 Founded in 1946 to stop the exploitation by middlemen.
 Inspired by the freedom movement.
The seeds of this unusual saga were sown more than 74 years, a small town in the
state of Gujarat in western India. The exploitative trade practices followed by the
local trade cartel triggered off the cooperative movement. Angered by unfair and
manipulative practices followed by the trade, the farmers of the district approached
the great Indian patriot Sardar Vallabhbhai Patel for a solution. He advised them to
get rid of middlemen and form their own - co-operative, which would have
procurement, processing, and marketing under their control.
In 1946, the farmers of this area went on a milk strike refusing to be cowed down
by the cartel. Under the Inspiration of Sardar Patel, and the guidance of leaders like
Morarji Desal and Tribhuvandas Patel, they formed their own cooperative in 1946.
This co-operative, the Kaira District Co-operative Milk Producers Union Ltd.
began with just two village dairy co-operative societies and 247 litres of milk and
is today better known as Amul Dairy. Amul grew from strength to strength thanks
to the inspired leadership of Tribhuvandas Patel, the founder Chairman and the
committed professionalism of Dr Verghese Kurien, who was entrusted the task of
running the dairy from 1950.
The then Prime Minister of India, Lal Bahadur decided that the same approach
should become the basis of a National Dairy Development policy. He understood
that the success of Amul could be attributed to four important factors. The farmers
owned the dairy, their elected representatives managed the village societies and the
district union, they employed professionals to operate the dairy and manage its
business. Most importantly, the co-operatives were sensitive to the needs of
farmers and responsive to their demands.
At his instance in 1965 the National Dairy Development Board was set up with the
basic objective of replicating the Amul model. Dr. Kurien was chosen to head the
institution as its chairman and asked to replicate this model throughout the country.
➖PURCHASE MOTIVATION
Behind every purchase, there is an underlying buyer motivation. It relates to the
feelings, thoughts, and instincts that can result in a buyer's desire to purchase an
item. Buyer motivation, also known as buying motive, is a combination of people's
emotional and factual states that drives their urge to purchase.
-Every human activity has a motive behind it. So also, the buying activity of every
buyer has a motive behind it. A buyer does not simply purchase something. He
takes a decision to purchase something only when a motive (i.e., inner feeling or
urge) make him to buy it. Buying motives of a buyer refers to the influences or
motivations forces which determine his buying. In other words, a buying motive is
the inner feelings, urge, instinct, drive, desire, stimulus, thoughts, or emotion that
makes a buyer buy a certain product or service to satisfy his needs.
-Value to customers and value to their money
-Keep less and pass more attitude followed for pricing
-Impeccable whiteness of milk maintained across all products
-Continuous innovation with product range
-Taste that suits Indian taste buds.
-Amul offers high quality products and decent prices. And it has maintained
standards for years.
-Also, most of the products Amul makes are 'Indian' products.
-Amul is cooperative with a human face - not a faceless company owned by
conglomerates.

➖CONSUMER EXPECTATIONS
Consumer expectations refer to the economic outlook of households. Generally,
customer expectations are a set of ideas about a product, service or a brand that a
customer holds in their minds.
Customer wants these expectations met in order for them to feel satisfied with the
customer service and with their purchase. They’ll also have expectations that aren’t
so easy to see.
Knowing your customer expectations is important to all businesses – whether
you’re a small business or a large enterprise organization
Customer expectations matter because – if you can meet them – customers are
likely to spend 140% more after a positive experience.
1. From the survey conducted it was found that 90% of the consumers buy milk
daily.
2. From the survey conducted it was found that 50.3% of the consumers were
aware about Amul milk through friends/family, 46.9% through T.V Ads and 2.9%
through Direct mailers
3. From the survey conducted it was found that out of 350 respondents 70.3% of
consumers says quality is the most important factor while buying Amul milk, 12%
prefers taste as important factor and 9.1% prefers Brand and 8.6% prefers
availability.
4. From the survey conducted it was found that 44% of consumers rate Amul milk
as Good in comparison with other brands, 30% rate as very good and 26% rate as
excellent.
5. From the survey conducted it was found that 50% of the consumers are highly
satisfied with the taste of Amul milk, 43% are satisfied and 7% are highly
dissatisfied.
6. From the survey conducted it was found that 28% of the consumers are satisfied
with the price of Amul milk, 27.7% are dissatisfied, 26.6% are neither satisfied nor
dissatisfied,13.4% are highly satisfied and 4.3% are highly dissatisfied.
7. From the survey conducted it was found that out 350 respondents 70% of the
consumers had no suggestions to give, rest 30% of consumers suggested for Amul
milk some common suggestions are to reduce the Amul milk price.

➖RISK FACTORS PERCEIVED

Perceived risks refer to the spirit cost associated with customers' purchasing
behavior, which represents a kind of uncertainty about the future. This uncertainty
will directly affect the consumers' purchase intention.
1. LIQUIDITY- In fiscal 2018, revenue rose 3 year - on - year supported by
growth across the product portfolio, including pouch milk, butter, ice cream, and
dairy antener Milk procurement , however , was relatively higher resulting in
increased fat and powder inventory at year - end. Due, debt was higher than
anticipated as of March 31, 2018. Excess inventory is expected to be liquidated in
fiscal 2019, driven by steady demand for milk and milk products, and initiatives
taken by the state government to help reduce powder inventory, capital expenditure
( capex ) of about Rs 100 crores expected to be undertaken per annum over the
medium term towards expansion of capacity at the Ganch Nagar pant ( Amul fed
Dairy ) . Favorable demand for milk and products, and steady scale up in
operations at the new term ) . capacities are expected to dive growth in revenue
(expected at 10-12% over the medium
2. Susceptibility to changes in government regulations, and environmental
conditions: GCMMF , like all dairy players , is susceptible to government
regulations - such as ban on skimmed milk powder ( SMP ) exports in the past ,
and removal of export incentives . Furthermore, it is also susceptible to failure in
milk production because of external factors such as cattle diseases.

3. Exposure to risks related to volatility in global milk powder prices:

Exposure to risks related to volatility in global milk power prices are inherent in
the dairy industry. - For instance, the global crash in SMP prices in fiscal 2018 led
to surplus procurement, which translated into large inventory , leading to an
increase in working capital debt .

➖Reference group influence

A reference group is a group to which an individual or another group is
compared, used by sociologists in reference to any group that is used by an
individual as a standard for evaluating themselves and their own behavior.
Types of reference groups and how they influence to buy amul products

Primary Groups-
Primary reference groups are basically the set of people whom you meet every
day. They can be from your family, your close friends, your roommates, etc.
These people from primary groups may have a direct and strong impact in your
lives and your buying decisions since they are very significant to you. Primary
groups make you comfortable and give you a feeling that they are with you when
you are confused about a purchase. These people give you very honest and clear
advices as they are so close to you, due to which you could be more confident
about the purchase. Research shows that the bond between people leads people to
be effectively social and as satisfied consumers.
Amul is known amongst the most heard companies today.
If you go and ask any random in the streets to suggest any good dairy products like
milk , butter. 90% will recommend you to go for amul products.
This is nothing but the trust that the company has built throughout the years.
Any closer person will aways suggest you the product which trust worthy also
primary group of people are very honest and clear advices as they are so close to
you, they will most probably suggest you to go for amul.

Secondary Groups-

Secondary reference groups are usually formal and they speak less frequently.
They might be professionals, your collogues, your seniors at work or your
acquaintance at club, etc.
In secondary reference groups the power to influence people is quite less as
compared to primary reference groups as people in these groups are not that
comfortable in sharing their thoughts or views on the purchase.
Secondary group of people for example your college senior , any person at work
or college from another department are generally those people whose advice will
not be as assuring to you compared to primary group of people.
Even the secondary group of people will suggest you to go for amul products as
oviously its is generally more trust worthy and more heard and used .

Aspirational Group-

Aspirational group is the one to which a person may want to become part of. They
currently are not part of that group but wish to become and get with that group.
For doing the same, they try to dress, talk, act and even think the way the
members of that group do.
For example, people who like Madhuri Dixit wish to become like her and meet
her and so start purchasing and using all those products that she endorses.
An example of aspirational group of amul maybe the individual or group of
individual or keep on promoting amul products in a daily basis or suggest the
product during any recommendation.
There are many group that exist which work in the specific purpose for
promotion. It may be paid or unpaid.
They may do that because they liked the product or maybe the product suited them
Compared to products of the competitors.

Dissociative Group-
The people in these groups are totally opposite to the people in the aspirational
group. Here people deny of becoming or getting connected to a particular group.
They just hate being related to that group.
For example, if people don’t like a particular community, they would never like
being connected to them. So they would try all the possible ways to avoid the way
in which they dress, think or act.
Thus marketers need to understand the likes and dislikes of the consumers and
also the groups to which they belong. Marketers should recognize the extent to
which a reference group influences the consumer and he should also understand
out of all the groups which group influences him the most.

Generally, all dissociative Group will suggest and use Amul products.

Family-

Family of a consumer plays an important role in the decision making process. The
parents, siblings, relatives all have their own views about a particular purchase.
A family falls under primary groups , a family can be the one you you trust the
most, You can trust them most also for the reason that they will use the product
along with use ,also because they will never want you to use any product which
they cannot trust .
A family atleast have used even 1 product of amul. It maybe amul
milk,butter,ghee,etc again it is the trust build by the company throught the year.
➖ Decision making process
Decision making is the process of making choices by identifying a decision,
gathering information, and assessing alternative resolutions.
Using a step-by-step decision-making process can help you make more deliberate,
thoughtful decisions by organizing relevant information and defining alternatives.
This approach increases the chances that you will choose the most satisfying
alternative possible.

Steps for decision making process

Step 1: Identify the decision

You realize that you need to make a decision. Try to clearly define the nature of
the decision you must make. This first step is very important.

Step 2: Gather relevant information

Collect some pertinent information before you make your decision: what
information is needed, the best sources of information, and how to get it. This step
involves both internal and external “work.”

Step 3: Identify the alternatives

As you collect information, you will probably identify several possible paths of
action, or alternatives. You can also use your imagination and additional
information to construct new alternatives. In this step, you will list all possible and
desirable alternatives.

Step 4: Weigh the evidence

Draw on your information and emotions to imagine what it would be like if you
carried out each of the alternatives to the end. Evaluate whether the need identified
in Step 1 would be met or resolved through the use of each alternative.

Step 5: Choose among alternatives

Once you have weighed all the evidence, you are ready to select the alternative that
seems to be best one for you. You may even choose a combination of alternatives.

Step 6: Take action

You’re now ready to take some positive action by beginning to implement the
alternative you chose in Step 5.

Step 7: Review your decision & its consequences

In this final step, consider the results of your decision and evaluate whether or not
it has resolved the need you identified in Step 1.

➖ Situational influence
Situational influences are temporary conditions that affect how buyers behave—
whether they actually buy your product, buy additional products, or buy nothing at
all from you. They include things like physical factors, social factors, time factors,
the reason for the buyer's purchase, and the buyer's mood.
Economic Factors:
“ An economic factor directly affects the economy and its performance, which in
turn directly affects the business and its profitability. These factors include interest
rates, employment or unemployment rates, commodity costs and exchange rates “
In many countries, Amul has received significant benefits in the form of lower
milk procurement prices of nearly 30% to 60%.

The company has also benefited from this by reducing the prices of its products
like milk powder and butter by 30%. The price of milk powder in India has
increased from Rs.130 to Rs.150, which has affected the milk procurement prices
by Rs.4 to Rs.5 per litre. Both domestic and international markets are in a
recessionary phase.

An increase in transportation costs can significantly impact the Company’s ability

to deliver its products to the end consumer. In 2019, an 11.24% increase in milk
procurement costs and a 14% increase in diesel costs led to an increase in Amul’s
milk transportation costs. In the same year, there was an increase in interest and
bank commission of about 10%.
Social Factors:
” The focus here is on the social environment and identifying emerging trends.
This helps a marketer to better understand the needs and wants of consumers in a
social environment. Factors include changing family demographics, education
levels, cultural trends, changing attitudes, and changing lifestyles “
The individual purchase decision is mainly the result of social factors such as
culture and society. Friends, peers, families, reference groups can have a great
influence on the consumer’s consumption and purchasing behaviour. Amul has
taken advantage of these factors and successfully targeted women and children.
The company has created a strong and vital presence in the dairy segment.

A large number of consumers are increasingly opting for a vegan lifestyle. The
increase in the number of vegans would have a negative impact on the dairy
industry as this lifestyle does not allow the consumption of dairy products derived
from animals. The overall picture for the company looks positive as Indian
households have become more accustomed to morning tea and people, in general,
are more accustomed to milk and dairy products. Also, the culture of fast food
encourages a certain lifestyle that increases the consumption of ice cream.

Technological Factors:
“Technological factors consider the pace of technological innovation and
development that could affect a market or industry. These factors include changes
in digital or mobile technology, automation, research and development. There is
often a tendency to focus only on developments in digital technology, but new
methods of distribution, manufacturing and logistics must also be considered “
As a global brand, Amul understands the need to invest in various technologies and
also upgrade the current technology to attract and retain the current customers. The
brand has invested Rs 600-800 crore in setting up new milk processing plants in
the current financial year.

The company has also invested to expand the capacity of the existing plants. The
entire industry is gearing up with a host of the latest technologies that will help in
monitoring the productivity of dairy animals and dairy farmers. It is all about
identifying faulty practices and taking corrective measures to meet the market
demand.

The latest technologies are equipped with smart French fries with unique
identifiers that help companies record the productivity and health status of
individual animals.
➖Personality
Personality is the sum total of an individual’s enduring internal psychological traits
that make him or her unique. Self-confidence, dominance, autonomy, sociability,
defensiveness, adaptability, and emotional stability are selected personality traits.
In the advertisement we can see that Amul has launched lite butter. The very first
company to launch lite butter in the market. Which avoids heavy breakfast and
people started preferring bread with butter. Usually, high class corporate avoids
heavy food in the morning.
Amul’s butter and Kellogg's chocos launched at the same time where Kellogg's
failed to describe its applicability. So, they failed to capture the market and Amul
captures all personality type people with their product. then they launched Amul
pro which refer to protein. People who want to have a heavy personality can use
this product.Amul launch their milk powder by promoting as a low calories
whitener which will give you protein equivalent to milk but avoid unnecessary
calories.

➖ Post purchase evaluation

After purchase, the consumer might experience dissonance from noticing certain
disquieting features. Marketing communications should supply beliefs and
evaluations that re-in forces consumer’s choice and help him or her feel good about
the brand.

Amul has had a record in content marketing for years. It is now becoming an
example of customer service on social media. The brand has proved that it is
actually using social media for listening to its customers and solving their queries
on Face book. On tenth October,2014, a disgruntled customer posted pictures of
Amul Gold milk. The images within the post were scary and portrayed a very
negative image of the brand. Within 4 days, the brand had come out and explained
itself on its Face book page. It alleviated the fears which was instilled in its
customers and even gave detailed information which the consumer wanted. This
restored the brands positive image and brand loyalty.