FINAL REPORT

ON

How marketing tools of brand availability and sales promotion aid in

consumer decision making process – a case of USL in Indian lifestyle

alco-beverage industry

By

Atin Vats

09BSHYD0196

Icfai Business School, Hyderabad

United Spirits Ltd. (USL)

1 | A T I N V A T S

A REPORT

ON

How marketing tools of brand availability and sales promotion aid in

consumer decision making process – a case of USL in Indian lifestyle

alco-beverage industry

By

Atin Vats

09BSHYD0196

United Spirits Ltd. (USL), Delhi.

Date of Submission: 14th MAY, 2010

2 | A T I N V A T S

AUTHORIZATION

The making of this report has been authorized by Mr Gaurav Bhargawa, Senior Manager (Sales).

The report is submitted as a fulfillment of the requirements of Summer Internship program 2010 at ICFAI Business School Hyderabad.

All items mentioned in the report are part of the projects undertaken by Atin Vats at United Spirits Ltd, Delhi. These are only proposed guidelines for recommendations and benefit of the organization.

3 | A T I N V A T S

AKNOWLEDGEMENT

I take this opportunity to express my sincere heartfelt thanks to Mr Gaurav Bhargawa, Senior Manager (Sales). He has been a guiding light in the organization, right since the first day when he introduced me to the team and provided me to achieve every endeavor. He has always had trust in my work and has appreciated the same. This project wouldn’t have been possible without his immense guidance and support.

I would also like to thank Mr. Paritosh Berry, Management trainee for his continuous guidance and support in helping me complete my project.

I would like to thank Dr. Nikhil Rastogi, IBS Hyderabad, who has been available at all time and has been resourceful in helping me understand the project better. Also his visit to my organization was very enlightening as I could clear my doubts and since then have continued to trouble shoot the problems as they appear.

I am also thankful to all the staff of United Spirits Ltd,Delhi who has gone out of their way to help and support me on various assignments during my internship. It was a great learning experience working at USL Ltd.

4 | A T I N V A T S

ABSTRACTThe host company is a liquor major. The liquor industry functions in a highly

regulated environment. Therefore, the importance of study on marketing activities becomes vital in the light of prohibition of advertisements, such as TV commercials, billboards, point of purchase posters, etc by the government. Delhi Market is particularly sensitive as there are various legal issues here as well as the Excise Department controls the prices here. Companies here are not even allowed to publicly display information on the various free gifts that they are providing with their products, which keeps the customers in the dark. The study seeks to understand and study the impact of various other marketing activities such as Sales promotion (freebies), Shelf display, Stealth Marketing Strategy, etc on the buying behavior of the consumer.

In a bid to increase market share, the company has employed Stealth Marketing strategy. Stealth Marketing pays people (Called ‘Promoters’ here) to anonymously promote their products in shops without disclosing their financial relationship with their sponsoring firm. The company spends close to Rs. 5 crores annually in the Delhi market on promoters. The study will help clarify whether the strategy of employing promoters has been effective or not. Questionnaires will be framed to gather data from the shop-in-charges on whether they feel that the promoter is effective in making induced sales. The promoters’ skills as a communicator and the ability to push their brands will be understood. Also the Sales data of the shops where the Promoters have been placed will be gathered to compare the Sales data before the Promoter was placed and after the Promoter has been placed to give us a clear understanding on the value addition of these Promoters.

Data on the availability and visibility of liquor from 200 shops in Delhi will be collected and then compared with the sales figures of the same shops (collected from the USL office records) over a two month period to help understand the impact of products availability and visibility on sales. The study will be based of four major brands of USL in the premium segment i.e., Signature, Royal Challenge, Antiquity Blue, Antiquity Rare and a major competitor Seagram’s Blenders Pride.Point of purchase is another discipline that has been carefully studied under the project. It signifies those activities that help catch the attention of the consumer when he is at the doorstep of the outlet. Activities such as danglers, signage’s, communication tower, rate lists, shop/sale timing boards act as point of purchase. They in evidently play the most vital tool for marketing groups as they are the only source of advertisement at the hands of the company. . Liquor bottle itself acts as a point of purchase tool, as a consumer when he approaches to buy liquor, notices a certain bottle on the shelf which catches his attention and therefore comes into his choice set/consideration set. Thus it helps in promoting information about the existence of a product.

TABLE OF CONTENTS

5 | A T I N V A T S

Abstract……………………………………………………………………….III

1. INTRODUCTION…………………………………………………7

1.1 Objective…………………………………………………………….8

1.2 Methodology……………………………………………………….8

1.3 Limitations …………………………………………………………9

2. Brief about the company……………………………………………..10

2.1 SWOT ANALYSIS…………………………………………………..15

3. Research Methodology and Design adopted………………17

3.1 Analysis of the Methodology……………………………18

3.1.1 Research 1………………………………..18

3.1.2 Research 2………………………………..19

3.1.2.1 Limitations…………………33

3.1.3 Research 3………………………………..34

3.1.4 Research 4………………………………..34

4. References………………………………………………………………..41

6 | A T I N V A T S

INTRODUCTION

1. Purpose of The Project Proposed:

The proposed project will help us study the impact of marketing activities on the consumer buying behavior.

2. Description:

The host company, United Spirits Limited, is under the UB Group headed by Dr. Vijay Mallya and is India’s largest and the world’s third largest spirit company. USL has a portfolio of more than 140 brands and enjoys a strong 59% market share for its first line brands in India. The liquor industry functions in a highly regulated environment. Therefore, the importance of study on marketing activities becomes vital in the light of prohibition of advertisements, such as TV commercials, billboards, point of purchase posters, etc by the government. Delhi Market is particularly sensitive as there are various legal issues here as well as the Excise Department controls the prices here. Companies here are not even allowed to publicly display information on the various free gifts that they are providing with their products, which keeps the customers in the dark. The study seeks to understand and study the impact of various other marketing activities such as Sales promotion (freebies), Shelf display, Stealth Marketing Strategy, etc on the buying behavior of the consumer.In a bid to increase market share, the company has employed Stealth Marketing strategy. Stealth Marketing pays people (Called ‘Promoters’ here) to anonymously promote their products in shops without disclosing their financial relationship with their sponsoring firm. The company spends close to Rs. 5 crores annually in the Delhi market on promoters. The study will help clarify whether the strategy of employing promoters has been effective or not. Questionnaires will be framed to gather data from the shop-in-charges on whether they feel that the promoter is effective in making induced sales. The promoters’ skills as a communicator and the ability to push their brands will be understood. Also the Sales data of the shops where the Promoters have been placed will be gathered to compare the Sales data before the Promoter was placed and after the Promoter has been placed to give us a clear understanding on the value addition of these Promoters.Data on the availability and visibility of liquor from all the 426 shops in Delhi will be collected and then compared with the sales figures of the same shops (collected from the USL office records) to help understand the impact of

7 | A T I N V A T S

products availability and visibility on sales. The study will be based of four major brands of USL in the premium segment i.e., Signature, Royal Challenge, Antiquity Blue, Antiquity Rare and a major competitor Seagram’s Blenders Pride.

3. Objective:

The objective of the project is to study the impact of marketing activities on the consumer buying behavior. The implementation of these key factors in the marketing plan of the company would prove beneficial to the company in the long run.The project also helps us get a key understanding of and insight on the functioning of the liquor industry.The project will involve constant interaction with Mr. Gaurav Bhargava, the company guide & Senior Sales Manager, Mr. Paritosh Berry, Management Trainee, as well as Mr. Shubojit, Head of Promoter Strategy at USL so as to check the progress at each stage and also for constant guidance.

4. Methodology:

The main source of information will be collected through the primary sources such as, Questionnaires filled by the shop in charges, Data collected from the liquor shops, Information will also be collected from secondary sources such as sales data of the liquor shops from the host company.Besides these, other information on the liquor industry would be searched from the internet. Following this, conclusions would be put forth along with recommendations for the host company.

A detailed guideline of the Research Plan is as follows:-A research plan is developed to gather the required information for analysis. This includes the following:Data source: Primary data collection is going to be done through questionnaires and surveys.Research approaches: Observational and survey researchResearch instruments: Questionnaires

Sampling plan: Sampling unit- The shop in-charges are the most ideal person to be surveyed

to get a feedback on the effectiveness of the Promoters as these Promoters function under them.

Sample size- 40 shop in-charges.8 | A T I N V A T S

Sampling procedure- We choose the 40 respondents out of a total of 69 to cover maximum areas.

Contact methods: Personal Interview

5. Limitations:

There are certain limitations attached to the project which are as follows:- The collection of data on availability and visibility of the 5 leading

brands in the premium sector of the whisky industry has limitations attached to it as the collection of data from various shops will be done at different times during the day, therefore, the data of the same will vary at different time intervals during the day in the same shop. For example, there are 10 bottles of Royal Challenge (750 ml) stacked on the racks at 12 noon, but by 4 p.m. it comes down to 2 bottles. Therefore, data will be starkly different during different time of the day.

In this industry specially, shop attendants store certain brands below the delivery counter. This is done to facilitate them in pushing brands which provide them better margins and/or also enables them to service quickly those brands which are popular. The problem with this is that when we conduct our research on availability and visibility, we give ZERO visibility to these as a consideration that affects consumer buying behaviour, but the fact of the matter is that these things greatly affect the consumer buying behaviour.

The questionnaires, to be filled up by the shop in-charges, are intended to evaluate the effectiveness of the promoters, but in reality this is not totally conclusive.

Certain liquor shops are so small that the shelf may not have enough impact on the consumer buying behaviour.

The judgment on the value addition of Promoters takes into consideration the sales figures before and after the Promoter had been placed. This change in sales figures may not have resulted only because of the promoter. There may be various other factors which might have led to the increase/decrease in sales figures like sales promotion, genuine increase in demand by itself.

9 | A T I N V A T S

Brief About the company

United Spirits Limited (USL) is the largest Spirits Company in India and among the top three spirits companies in the world.

Besides Whyte & Mackay and Bouvet Ladubay being 100% subsidiaries of USL, the company has 19 millionaire brands (selling more than a million cases a year) in its portfolio and enjoys a strong 59% market share for its first line brands in India.

United Breweries Group

Type Conglomerate

Industry Brewery

Alcoholic Beverage

Airline

Chemicals & Fertilizers

Engineering

Information Technology

Pharmaceuticals

Founded 1857

Founder(s) Thomas Leishman

Headquarters Bangalore, India

Area served India

10 | A T I N V A T S

Key people Dr. Vijay Mallya, Chairman

Owner(s) Dr. Vijay Mallya

Divisions United Breweries Ltd (BSE:532478)

United Spirits Ltd (BSE:532432)

Kingfisher Airlines [1]

Mangalore Chemicals & Fertilizers Ltd[2]

UB Global (trading company)

UBICS, Inc.

Website www.theubgroup.com

Excise Department

11 | A T I N V A T S

The prime job of Excise Department is to regulate import and supply of liquor, intoxicants and narcotics (for medicinal purposes), the statutory powers for which are discharged under the Punjab Excise Act, 1914 and Medicinal and Toilet Preparation Act 1955. The Department grants L-1 Licences to Distilleries/Bottling Plants for the wholesale supply of liquor in Delhi, while retail liquor trade in Delhi is mainly in the hands of the Government Undertakings for which a separate licence in form L-2 is granted. Apart from this some private entrepreneurs have also been granted licenses in Form L-52 for retail trade of IMFL & Beer. Besides, Licences for the consumption of liquor 'on-site' premises like hotels, restaurants and clubs are also granted by this Department. The Department invites tender on yearly basis for wholesale supply of country liquor from the distilleries/bottling plants and licence in Form L-9 are issued to successful tenderer. The Department also fixes the price of Country Liquor and regulates it's supply for retail sale through DTTDC, DCCWS, DSCSC, DSIIDC for which L-10 license are granted. Licences are also given for holding/hosting private parties as well as for storage for personal consumption beyond the  permissible limits for which L-52 licenses are provided.

At present four corporations namely DTTDC, DSCSC, DSIIDC and DCCWS are engaged in the retail trade of liquor. The private entrepreneurs are also holding 89 shops for retail sale of IMFL & Beer all over Delhi.The Department has also granted 2 L-53 licence for retail sale of Beer & Mixed Alcoholic Beverages through Departmental Stores for "off-site" consumption in the Excise Year

The department also regulates consumption/distribution/issue of rectified spirit Denatured spirit, Life Saving Drugs like morphine, pathedine, Mediclinical Opium and hemp to various government hospitals, Private Nursing homes, Doctors,etc. Sale of denatured spirit and rectified spirit in wholesale or retail without a valid license is an offence in delhi. Possession of spirit and narcotic drugs without a license is also a cognizable offence.

IMFL Branch/Licences of Liquor

The IMFL branch issues L-1 licences to Distilleries/ Bottling plants for supply of liquor to the retail outlets, licensed hotels, restaurants and clubs. The applications for the grant/renewal of L-1 licences are invited through a public notice. After the receipt of the applications, these are scrutinized. The applications which are complete in all respects and fulfil all the requirements are taken into consideration for the grant of L-1 licence by the Competent Authority. Cases are processed according to the Terms and Conditions for the grant of licences. Once the L-1 licence is granted, licence fee is to be deposited. The L-1 licence is further processed for the approval of the brands as well as the price. Fixation of price is done by Excise Commissioner. Price structures are issued after the payment of brand fee and brand registration fee. Payment of brand fee is on pro-rata basis.

All the L-1 licencees are required to maintain Bonded Warehouses which are supervised by the Excise Inspectors.

Import Permits: The Import Permits are issued to the L-1 licencees  after payment of import fee. The concerned Excise authority of the state where the distillery is located issues export permits on the

12 | A T I N V A T S

basis of the Import Permits to take the liquor out of the state without payment of Excise duty. The Excise Inspector posted at the Bonded Warehouse after scrutinizing all the documents allows the stock for in-bonding.

Transport Permits: Transport permit is a document which authorises L-1 licencees for taking out the specific quantity of liquor mentioned in Transport Permit for supply to a specified destination. Transport Permits are issued only after the deposition of requisite Excise Duty/Revenue by the Licencee. On receipt of the Transport Permits, the Bonded warehouse Excise Inspector allows the stock for transporting it to various retail outlets, clubs, hotels/restaurants.

United Spirits Limited (USL) - the INR 5700 crore spirits arm of the UB Group – is India’s largest and the world’s third largest spirits company. USL was earlier McDowell and Company Limited. USL has a portfolio of more than 140 brands, of which 19 are millionaire brands* (selling more than a million cases a year) and enjoys a strong 59% market share for its first line brands in India. United Spirits recorded global sales of 90 million cases for the fiscal year that ended on March 31, 2009.

United Spirits’ brands have won the most prestigious of awards across flavors, ranging from the Mondial to International Wine and Spirit Competition (IWSC) to International Taste and Quality Institute (ITQI); a total of 108 awards and certificates (as of June 2009). The company is known to be an innovator in the industry and has several firsts to its credit such as the first pre-mixed gin, the first Tetrapack in the spirits industry in India, the first single malt manufactured in Asia and the first diet whisky in the world. 

United Spirits has a global footprint with exports to over 37 countries. It has 79 manufacturing and bottling units across the country and in Nepal and is supported by a robust distribution network to deliver its products to customers located across India. USL has a committed 7500-strong workforce spread across its offices and distilleries in the country.

United Spirits represents the merged entities of the erstwhile McDowell & Co. Limited, Phipson Distillery Limited, United Spirits Limited, Herbertsons Limited, Triumph Distillers and Vintners Private Limited, Baramati Grape Industries Limited, United Distillers India Limited, McDowell International Brands Limited and Shaw Wallace Distilleries Limited. The erstwhile McDowell & Co. Limited was first established as a proprietary business in 1826.

USL acquired Balaji Distilleries Limited in 2008. This acquisition gave the company the strategic advantage to consolidate the Group’s leadership position in a critical, large and growing State like Tamil Nadu. Currently, the procedural formalities are underway for the acquisition which will take retrospective effect from April 1, 2009.

United Spirits acquired Andhra Pradesh (AP)–based, Tern Distilleries, in 2009, in a bid to augment its primary distillation capacity. This is the third manufacturing unit in the region given that one fifth of USL’s sales volumes come from AP. The current capacity of Tern is 40 Kilo Litres which will be enhanced to 120 Kilo Litres in 24-36 months, subject to Government approvals.

13 | A T I N V A T S

Particulars Total Number Comments

Brands 14019 of these are millionaire brands and there are about 151 brand variants

SKUs 2992 Distillery-State-Brand-Pack combinations

Distilleries / Bottling Units 79

30 Owned Manufacturing facilities;49 contract manufacturing units

Depots 48 Break-bulk points for finished goods distribution

Retail Outlets 64000 Inclusive of both on and off premise outlets

*USL Millionaire Brands (Those that sell more than a million cases per annum)

Whisky Scotch Brandy Rum Vodka & Gin• Bagpiper • McDowell’s No.1 • Director’s Special • Old Tavern• Haywards • McDowell’s Green Label • Gold Riband • Royal Challenge 

• Black Dog• Whyte &

Mackay• Jura• Dalmore

• McDowell’s No.1 • Honey Bee • John Ex-Shaw

• Celebration Rum• Old Cask Rum • Old Adventurer Rum

• Pinky• White

Mischief• Romano

v

14 | A T I N V A T S

• DSP Black • Signature

SWOT ANALYSIS

An important and most basic tool to identify the potential of an organization or a product of a company is SWOT Analysis. SWOT stands for Strengths, Weaknesses, Opportunities and Threats of an organization/product. Specifically, SWOT is a basic, straightforward model that assesses what an organization can and cannot do as well as its potential opportunities and threats.

15 | A T I N V A T S

Analysis was done on the basis of observations made and was separated into internal (strengths and weaknesses) and external issues (opportunities and threats). The main objective of SWOT analysis was to determine what may assist the growth of the brand USL and what are the obstacles that it is facing which once overcome would help achieve the desired results.

Strengths:

Market Leader

Strong Product line

Strong Brand Image

Global Presence

Aggressive Advertising

Quality and Innovation

Weakness:

Long Development cycles

Expensive Brand Maintenance

Expensive capital spending in acquiring Successful Liquor firms like White

and Mackey, Shaw Wallace, etc.

Opportunities

Demographic Changes

16 | A T I N V A T S

Internal attributes External attributes

Weaknesses Opportunities ThreatsStrength

Changing Societal Attitudes

Consumer Brand Preference

Optimum utilization of the strong distribution network

Demand for High Quality

Threats:

Highly regulated market (government regulated).

Cloning of Successful brands

Fluctuation due to Seasonal Demand of the products

High level of competition due to the aggressive strategies deployed by the

domestic players.

Uncertain customer reactions to new product introductions.

Quick Customer switch to other brands (Low customer loyalty)

Change in governments policies.

Entry of Foreign Competitors.

RESEARCH METHODOLOGY AND DESIGN

Research work undertaken till now:-

Research objective:

To understand the impact of ‘display of liquor on shelves of the liquor shops’ on the sales.

Study on Point of Purchase activities at the outlets.

Research methodology and design:17 | A T I N V A T S

Type of research

Observational and survey research.

Data collection:

Primary Data

Primary data of research are collected from direct resources i.e. (the liquor outlets).

Secondary Data

Secondary Data is collected in the form of sales data of individual liquor outlets for the month of February and March, 2010. This data has been generated by the orders procured by the host company from the Excise Department.

Universe

Universe of this research is 426 liquor shops in Delhi which includes outlets of all the four government departments i.e. DSIIDC, DCCWS, DTTDC, DSCSC and private outlet L-52.

NOTE: All genre of the market were covered to make the research appropriate. Also shops from all the various localities were considered to move out biases if any in the research.

Sampling technique

Random sampling is used for research project. 200 shops have been chosen to represent all the areas in Delhi. After closing down on these 200 shops, I have visited them twice, once in the month of February and once in the month of March, 2010.

Sample size

200 outlets have been selected for the research.

ANALYSIS of the research undertaken:-

18 | A T I N V A T S

Research 1: Data on availability and visibility from 200 shops across Delhi has been collected. Emphasis has been put to cover all the various departments set by the government. Interaction with the shop in charges of the outlets was one of the major factors which influenced our collection of data. Data from this sample size of 200 shops will help us understand the impact that visibility has on sales since visibility plays a very important role in the highly government regulated market as it is the only tool in the hands of the company to catch the attention of the consumer. One of the major hindrances in the collection of this data was permission to access the shelves of the shops.

During our visits to the outlets, we have come to see the various strategies employed by the players in this industry to promote their products. Point of purchase, hence plays a significant role here. Point of purchase tools like the use of danglers, signage’s, communication tower, rate lists, shop/sale timing boards help in attracting the attention of the consumer to the companies products. Liquor bottle itself acts as a point of purchase tool, as a consumer when he approaches to buy liquor, notices a certain bottle on the shelf which catches his attention and therefore comes into his choice set/consideration set. Thus it helps in promoting information about the existence of a product.

Now we have the data in different pack sizes which makes the study difficult. Hence, we have assigned weights to the various packs to bring in uniformity in the study. Liquor comes in various packs based on volume such as 2 ltrs, 1 ltr, 750 ml, 375 ml, 180 ml and 90 ml. Therefore weights have been assigned in the ratio of 8, 4, 3, 1.5, 0.8 and 0.4 respectively to sort out unevenness.

Once the data has been brought to a common platform, we have totaled the availability and visibility columns for all the brands under study and for all the 200 outlets. This has been done for the data of both the months. Now we have data representing total of all the outlets and of all the 5 brands individually.

Next, we have computed the visibility/availability ratio for all the five brands. This ratio signifies the percentage of availability that is visible. The ratio desired is 30%, i.e., 30% of the available liquor is visible to the consumer and thus catches maximum consumer attention.

After this we have showcased where all the company needs to put in an effort to look to increase the visibility of their products and where it has a strong visibility level.

Research 2: Regression Analysis using SPSS

Overview

19 | A T I N V A T S

Regression is similar to correlation in that it is trying to fit data values along a best-fit straight line, but regression can be used to predict the value of one variable given the value of another variable. In other words, regression lets you predict what your dependent variable value will be from one or more independent variables.

Hypotheses of the study

H0: The proportion of variance Visibility (independent variable) accounts for in Sales (dependent variable) is 0. (no relationship)

H1: The proportion of variance Visibility (independent variable) accounts for in Sales (dependent variable) is not 0. (there is a relationship)

Here in our study we have undertaken regression analysis using SPSS. We have conducted Linear Regression using the variables Visibility and Sales on a monthly basis, taking Visibility as an independent variable and Sales as a dependant variable. We have sales and visibility data for the months of February and March, 10 for the brands Royal Challenge, Signature, Antiquity Blue, Antiquity Rare and Blenders Pride. Thus we have come out with 10 different studies for our analysis of determination of the percentage variance in the dependant variable explained by the independent variable.

Out of the sample of 200 shops, 28 shops were excluded from the study as permission to conduct the study was not provided in them.

20 | A T I N V A T S

Assumptions of the study:-

1. The variance reflected by the regression analysis solely reflects the impact of visibility on sales.

2. The visibility data obtained is the same throughout the month.

3. The order data obtained from the company is the sales data for the respective months.

4. Since there are different pack sizes on offer, therefore to bring about uniformity weights have been assigned to them. The weights assigned for calculation of visibility are:-

i. 2ltrs: 8

ii. 1ltr: 4

iii. 750 ml: 3

iv. 375ml: 1.5

v. 180ml: 0.8

vi. 90ml: 0.4

5. We have given more importance to visibility than availability as visibility is what ultimately is in the line of sight of the consumer.

6. All the shops have been given same weightage inspite of the fact that sale of individual shops differ greatly.

21 | A T I N V A T S

7. Stock which has been stored below the delivery counter has been given zero visibility because they do not fall in the line of sight of the consumer.

Limitations of Study:-

The secondary data collected from the company “Sales Data” is actually excise orders received for the months of February and March, 2010.

Data collected from outlets varies from time to time each day, since the shopkeepers sell from the shelves, hence depleting the quantity on the shelves.

Many shop-in-charges have not given me permission to undertake the study in their shops. Thus hampering the study.

Many shop keepers store their products in counters. This has zero visibility but the reason behind stocking them below the counters is that the stock only those products which move fast and which offer them higher margins.

Certain liquor shops are so small that the shelf may not have enough impact on the consumer buying behaviour.

As understood from studying the sales data, there is high variability in sales during the two months. This is due to special events like Holi, the sale of liquor rises substantially. Thus hampering our study.

Due to push selling, orders given by the excise department are high. Therefore, during special events, anticipating high sales, shops give higher orders. This also leads to piling up of stock, hence in the next month the orders given fall.

Finding a direct correlation between change in availability and visibility over change in sales is difficult as there are other factors as well that impact sales like special events, seasonal changes, marketing activities.

Note: A copy of the research data on this study has been attached along with this as a link. Click here to see them.

Research 3: Point of Purchase:

We have visited 72 outlets and tried to study the status of the point of purchase activities undertaken by the company. Since advertising is banned in Delhi, therefore, the company uses tools such as NEXT DRY DAY BOARD in company printed cardboard, Communication Tower, L-49 license board, and IPL Calendar. We made a note of the things which were in place and things which needed to be put into place.

22 | A T I N V A T S

The findings greatly helped the company in indentifying areas where it needed to pay attention.

Note: A copy of the research data on this study is attached separately. Filename: SHOP OBSERVATION.xls.

Research 4: Study to judge the effectiveness of promoters.

70 shops at which promoters are used by the company were visited and data have been collected through observation. Promoters are judged on many aspects such as knowledge about the product, price knowledge, tone of communication, time spent on a customer. The data regarding this was taken through the interaction with the shop incharges, promoters and on the basis of observation at these shops.

Analysis of the efficiency of the promoters by judging them on various attributes

Number of customers attended by the promoter on a daily basis.

Analysis and interpretation:

Here the data suggests that the ideal scenario of more than 20 customers is being fulfilled by 40% of the surveyed sample. Another 45% are near the target objective. The remaining 15% are attending less than 10 customers on a daily basis.

23 | A T I N V A T S

But basing the judgment solely on number of customers attended would be incorrect as other factors such as footfall, type of customers the individual shops cater to, etc matter as the product under study is of premium category whisky.

\

Time spent on a customer by the promoter

A majority of the interactions, i.e. 60%, between the customers and the promoters take less than a minute. This means that 60% of the times the promoter has to tell the customers about the benefits of the products they are promoting inside a minute and convince them to alter their choice.

In order to achieve this, a promoter should be well versed with the benefits of the products.

Affect of customer loyalty on the working of the promoter

24 | A T I N V A T S

According to the survey 60% of the sample believes that consumer loyalty for brands makes it really difficult for the promoters to convince the customers to try companies brand instead of their regular brand. As stated earlier also that consumers are generally loyal to their regular brands thus making them reluctant to try new brands.

This is the area where aspects like knowledge of price , product and tone of communication etc are very important as promoters interact with the end consumer to make them switch from competitors brand to our brand.

25 | A T I N V A T S

Free gifts and incentives help boost sales

The above chart shows that majority of the sample believes that the free gifts distributed by the company through their promoters effect the sale of their brands positively. On the other hand 30% believes that it does not help boost sale.

Tone of communication

The above chart shows that 45% i.e. the majority of the promoters are found to have average communication tone and 20% of the sample is coming under under bad tone, so we can say that these need improvement. Around 35% of

26 | A T I N V A T S

the sample have good communication skills which is very important in converting the customer and convincing them.

.

Understanding the product

The above chart shows that around 65% of the sample are lying in the category of average i.e. they are not having very good understanding of the product so they need to improve on this aspect around 15% are having poor understanding of the product.and the rest 20% of the sample have good understanding of the product.

Knowledge about the competitors product27 | A T I N V A T S

Majority of the sample i.e. 55% of the promoters are having average knowledge about the competitor’s product. So we can infer that the organization needs to work on this aspect as the knowledge about the competitors product is basis of the conversion.

20% of them are having poor knowledge and rest 25% of them lie under the category of good knowledge about the competitor’s product.

Conclusion

On the basis of data collected and observations made at the the shops while taking to shop incharges and promoters we can conclude that promoters are effective. These promoters are basically to improve the Sale of company’s brands and in order to do it they interact with customers so their communication skill, price knowledge, understanding of the product are very important aspects. Most of the promoters are found to lie under average category while judging them on basis of the above stated aspects thus we can conclude that this stealth marketing strategy of USL to employ their own employee at the shops to convert competitors customers is effective to an extent. The idea of this strategy is not giving 100% results but continues improvement and better management can improvise the very idea.

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Suggestion

The organization should organize workshops or training sessions for the promoters which will help them to increase their own efficiency. These workshops should be organized by company at regular intervals, the idea behind this to keep a check on the areas to improve. These training sessions will help the promoters to improve their communication skills, product knowledge, industry knowledge and other important aspects which will help them to increase the sale of organizations brands.

.

Please find copies of data, to be used as references, attached along with this file.

1. SPSS data

2. Brand Visibility and Availability SUMMARY

3. Shop Observation

4. USL presentatio

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References

The following is a list of some of the references that have been used so far.

1. http:// www.theubgroup.com 2. http:// www.unitedspirits.in 3. http:// www.prenhall.com/kotler 4. http://pernod-ricard-india.com /otherblendedwhisky.html 5. http://www.delhitourism.nic.in/publicpage/liquor.aspx ]6. http://www.excise.delhigovt.nic.in 7. http://www.theubgroup.com/business_beverage_spirits.aspx 8. http://www.sebi.gov.in/gp/ubfinal.pdf 9. http://excise.delhigovt.nic.in/ex3.asp 10. http://pernod-ricard-india.com 11. www.Wikipedia.org/wiki/united_breweries_group 12. www.Wikipedia.org/wiki/shaw_wallace 13. www.shawwallace.com/brands.html 14. www.theubgroup.com/profile_genesis.aspx 15. www.theubgroup.com/buisness_beverages_spirits.aspx 16. www.whyteandmackay.co.uk 17. www.wikipedia/wiki/whyte_and_mackaycom 18. http://www.marketwatch.com/story/united-spirits-clocks-

sales-volume-of-100-million-cases-to-become-the-worlds-2nd-largest-spirits-company-2010-04-08

19. www.thehind ubus inessline.com/.../2007051706070100.html 20. www.encyclopedia.com/doc/1G1-130650186.html 21. http://timesofindia.indiatimes.com/biz/india-business/Vijay-

Mallya-led-UB-Group-says-its-worlds-second-largest-liquor-maker-now/articleshow/5770991.cms

22. http://www.absoluteastronomy.com/topics/United_Brewerie s_Limited

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