Select Page
  

Describe the current situation for BIL in detail – include the timeframe, product-market focus (beginning of case – 1997), management’s rationale/reasons for expansion (outside biscuit market). No need to discuss plans for growth here; just what factors serve as an impetus for growth.Provide an analysis of the product-markets for potential expansion (e.g., dairy products, food). Include the size of the market, growth rates (where included), and competitors’ market share (including BIL). Why did management choose to expand into these product-markets? What was the risk of remaining in the biscuit product market?Identify and discuss the expansion and necessary changes to positioning strategy for BIL. Discuss the new look and all changes; explain why changes were made. Include the new product categories and new brands utilized for the growth strategy. What was the rationale for creating new brands for products?Discuss the successes for BIL – include percentage of market share captured in product categories, the ability to break into competitors’ domains (e.g., butter, cheese, dairy-whitener). Discuss the emphasis on ‘brands’ vs. ‘products’ for the Indian market – what factors mattered to Indian consumers? 2-3pages,
case_makeover_of_britannia__1_.docx

chapter_4_2018__1_.pptx

Don't use plagiarized sources. Get Your Custom Essay on
Makeover of Britannia Brand management Case Analysis Assignment
Just from $10/Page
Order Essay

Unformatted Attachment Preview

Makeover of Britannia: A Path Less Travelled
An old maxim goes, ‘Why fix something when it ain’t broke?’ This may be the credo of most firms, but
not of the food major, Britannia Industries Limited (BIL). In 1997, BIL, whose business seemed to be
doing well, instead of concentrating on it, virtually charted a new course by seeking to reinvent itself. It
built a new corporate identity and adopted a colorful and identifiable logo with a new base line – ‘Eat
Healthy, Think better.’ From being a manufacturer of baked products, BIL kicked off a diversification
exercise to become a comprehensive foods and beverages company making cheese and other dairy
products, in addition to its bakery products.
BIL seemed to be doing something radical by venturing into totally new areas, while this puzzled many,
some analysts felt that it was BIL was doing this out of compulsion. They reasoned that the 16% growth
rate of BIL sales, which was just 8% in real terms when corrected for inflation, though good by the
standards of a mature market, was not good enough for a growing market like India, especially in the
foods segment.
Others felt that BIL’s makeover decision may have been influenced by the threat of potential
competition. They also felt that with the organized biscuit market in India being commoditized, and the
major chunk being controlled by the unbranded segment, reliance on biscuits alone could be
detrimental to its long-term interests.
However, some analysts were of the opinion that the diversification of BIL into relatively new areas was
risky, and that it should have concentrated on its core competence, the biscuit business. By the end of
2000 the exploits of BIL seemed to have fructified, at least in the short-run. In a survey conducted by
A&M1, BIL emerged as the number one food company well ahead of competitive brands like Nestle and
Cadbury. BIL’s dairy business seemed to be doing reasonably well.
In the cheese segment it stood second with about 35% market share. In the bakery segment also it was
doing well, with its biscuits business making significant inroads. Its positioning plank, ‘Eat Healthy, Think
Better’ also seemed to have struck the right chord with its customers. Said Sunil Alagh (Alagh) “Our
brand today represents family trust, quality with a contemporary, youthful image.”
‘Food for Thought’
BIL, since its inception had been mainly involved in the manufacture of biscuits, which contributed
around 85% of its revenues (1997). The biggest problem then, for the 80-year-old BIL was that its name
was strongly associated by customers with biscuits (or more broadly bakery products). With the dereservation of biscuits from the small sector and commoditization of the Rs 3500 crore biscuit market,
coupled with cutthroat competition after the entry of multinationals and stagnating net profits, BIL
looked for a fresher approach to survive and prosper. BIL realized that it would have to scale up its
marketing strategy in its main line of business and in addition tap new food categories to grow. One
reason why BIL seemed to have woken late was that the company didn’t have a proper parent until the
French food and beverages major, Danone, acquired RJR Nabisco’s holding in the company2. BIL seemed
to have realized that the time had come to change the rules of the game.
It crafted a makeover plan to diversify into new but related areas, and at the same time consolidate and
improve its core business, biscuits. By doing so BIL hoped to remain the market leader in biscuits and
become a major player in related businesses also.
Donning a New Look
As a first step in its makeover plan, BIL hired a Paris based design studio- Shining Strategic design, to
craft a new logo and corporate slogan. Its work involved understanding the perceived and potential
value of the brand where everything from colors and symbols to the typeface, was evaluated. The work
also involved looking at the potential of the market and seeing where BIL could venture in future.
Research showed that the brand ‘Britannia’ was synonymous with trust and quality, and the wide
portfolio of products was seen as a source of strength. But, BIL was aiming at faster growth, by
expanding its business within the bakery segment and in select synergistic areas. Consumer research
conducted with these specific objectives in mind, brought to the fore two key issues: 1. Although the
brand had tremendous strength associated with it, it needed to communicate modernity strongly. 2. It
needed to assure the customers that apart from being a trusted and a familiar brand, it was also a
contemporary one, and changed with the times.
The fact that the existing brand was too closely associated with the bakery business, could have been a
hindrance to BIL’s diversification efforts. Therefore, Britannia needed a more dynamic expression. So
there was a need to restage the logo, with the twin objectives of communicating modernity and
dynamism. While developing the new logo and brand statement, the existing red and white shield like
unit was retained with a modern rendition. The new corporate identity had three colors red
(symbolizing energy and vitality), green (nutrition and freshness) and white (purity) which collectively
represented what consumers looked for in foods and beverage. Research had shown that the brand
statement, Eat Healthy, Think Better, captured the essence of the Indian concept of the unity of body
and mind. During the developmental process, care had to be taken to ensure that there was adequate
representation of all social economic strata in urban and rural India, for ‘Britannia’ as a brand, cut across
a cross-section of consumers. The red wave communicated the dynamic and energetic movement of BIL.
Analysts felt that the redesigned shield made BIL powerful and was the identifying stroke that
communicated the innovation and futuristic power of BIL and that the redesigned typography made BIL
very contemporary and less industrial. The roundness communicated the value of nature Eat Healthy,
Think Better.
The concept communicated perfectly BIL’s potential value from physical to mental benefits. Said Alagh, ”
The new corporate identity will testify to the implicit (good) quality of all our products and all our
products and colors stand for things we look for in all foods and beverages…”
The Balancing Act
For BIL, the new identity, laid the base to project its future as a successful food company- a company
that provided high quality and tasty, yet healthy foods and beverages. Analysts felt that BIL seemed to
have realized that its customers weren’t really buying biscuits; they were buying health, nutrition, and
food. If it was nutrition, not biscuits, that the customer was buying when he bought Britannia, BIL could
easily extend the brand to other markets where the customer looked for nutrition in every purchase. It
was a repositioning that did not have any intrinsic boundaries and BIL, by taking a heath platform could
enter other markets. Said Alagh, ” A key reason for re-engineering the brand was not only to make it
more robust and contemporary but also stretchable.”4 With the new identity in place, the next step in
BIL’s makeover plan was embodied in a two-pronged agenda: to bolster BIL’s strength in biscuits and to
reduce its dependence on biscuits (Refer Table I). As a part of its makeover plan, BIL reinforced its
strength in biscuits (and more broadly Bakery business) by seeking to consolidate and improve its
leadership position using aggressive marketing strategies. Said Alagh, “The bakery business is our pillar
and we want to strengthen that first.” To ensure that the core business was not sidelined, BIL brought
about changes in the management structure until that there were two clear divisions: Bakery and Dairyeach operating as independent profit centers. To meet the objective of bolstering its bakery business,
BIL re-positioned each one of its biscuit brands on a new platform and ensured that each brand had a
base statement making clear the ‘higher order benefits’ of the brand. BIL used combinations of price and
appeal to straddle every segment of the market, challenging all levels of competition.
BIL had structured a wide range of price-points: from Re 1 for a sachet of Tidbits to Rs 12 for a pack of 10
Good Day Pista Badam cookies, to Rs 15 for a 100 gm pack of Cheezlets. Likewise, BIL had straddled the
spectrum of segments with different product-benefits, all of which only reinforced the mother brand’s
new platform. In regard to brand building, BIL followed the strategy of ‘brand clustering’. The strategy
was to let ‘Britannia’ remain the mother brand under which a cluster of sub-brands would be present for
specific product categories. While the umbrella brand would act a guarantee for the consumers, the
sub-brand was used to give focus and distinct images for its new product categories and businesses to
get economies from brand building. (Refer TABLE II) Analysts felt that a company like BIL, which wished
to cater to a varied customer-base, needed to possess a large portfolio of brands, with different USPs,
positioned at different price-points, yet unified under a uniquely differentiated mother brand.
With this in view, BIL revamped its biscuit business. At the low-end price-point, was the ‘Tiger’ brand, a
“calcium-enriched” glucose biscuit launched in 1997, which acted as the umbrella brand for the mass
market. Until then, BIL had focused on the middle and premium segments of the biscuit market, leaving
Parle’s Parle G to rule the mass market. With the mass segment accounting for half of the unorganized
market, it seemed strategically important for BIL to make inroads into the same. Therefore, as a part of
its new plan to attack the mass market, BIL launched the ‘Tiger’ brand and positioned it as a ‘health
force biscuit’ as consumer research showed that good health was the overwhelming consideration when
mothers chose snacks for their children. Analysts felt that since Glucose had become a generic brand,
BIL by establishing a new brand was clearly differentiating its Glucose biscuits from others. The ‘Tiger’
brand eventually seemed to have been a huge success with its products, Tiger Glucose (Rs 5 for a 100gm pack) and Tiger Cashew Badam (Rs 6 for 75 gm) together, achieving within a year of their launch a
turnover of Rs 100 crore and a market share of, 30% in the glucose biscuits segment. BIL then focused
on its core biscuit brands- Marie, Thin Arrowroot, and Milk Bikis-which faced competition from similarly
branded alternatives like Bakeman’s English Marie, Milka Biscuits, and Priya Marie. In order to overcome
the competition, BIL differentiated its brands by bringing them under the ‘Eat Healthy, Think Better’
banner and giving them clearly-defined positioning. For Milk Bikis, targeted at children, BIL launched
variants like Milk Bikis Funland, which were animal-shaped biscuits. Marie was renamed Marie Gold, and
positioned as a tea-time biscuit. Thin Arrowroot was renamed Jacob’s Thin, with its position as the lowcalorie health biscuit reinstated. In 1999, BIL relaunched its low-calorie, high-nutrition brands-Thinlite,
Cream Cracker, and Digestive under the Nutrichoice umbrella, targeting the fast-growing healthconscious segment. BIL seemed to be quick in gauging the rising demand for products in the impulse
category of snacks (e.g. chips and chocolates). Accordingly, BIL came up with trendier products like Little
Hearts, Pure Magic, and Chekkers, targeting the under-24 urban consumers, positioning them with
statements they identified with. For example, ‘Direct Dil Se’ for Little Hearts, ‘Full of Taste and Fun’ for
Pure Magic, and ‘For The Ups and Downs in Life’ for Chekkers. In 1999, BIL had launched Snax, a line of
ethnic snack foods using low-fat oils and hygienic processes, in 3 variants: Calcutta Ka Chana Choor,
Bikaner Ka Bhujiya, and Rajasthan Ka Aloo Bhujiya, with an eye on the almost Rs 1800 crore snack
market in India. In the segment of ‘breads’ which contributed about 6% of the company’s total revenues,
BIL’s presence was restricted to a few cities. In the face of increasing competition, it decided to
strengthen its bread business in the southern states and was seriously looking for acquisitions and
manufacturing tie-ups in that region. It also planned to leverage the key strength of the daily
distribution system of its bread business in its new ventures like milk. With a view to boosting volumes,
BIL also changed its packaging strategy by launching biscuits in small sachets.
It launched the low-priced sachets, ‘Tiger Tikis-nibblets’ priced at Re 1-targetting the mass market. BIL
simultaneously revamped its distribution channels, increasing its retail distribution network to more
than 1.20 million outlets. To increase penetration, more than half of the new outlets serviced, were in
the rural and semi-urban markets-a break from the past, when BIL’s distribution was distinctly skewed
towards urban India. As part of its strategy to reduce its dependence on biscuits, BIL sought to diversify
its product portfolio to include categories that fitted within its overall objective of transforming itself
into a food company. BIL targeted segments where it had the potential of capturing either the number
one or number two position. Said Alagh, ” I am not into pioneering new eating habits. On the contrary,
we want to capture the essence of the Indian consumer. So we will be entering only those areas which
will form part of the daily eating habits of an Indian home and offer either high volume or high value.”
Analysts felt that what BIL had done was to build on the company’s already successful brand. With the
basic motto of ‘eat the BIL product you like, but eat,’ the company provided the consumer with an
option at all times of consumption (other than the main meals of lunch and dinner).
The underlying philosophy was to provide ‘tasty yet healthy’ snacks that one could eat and drink
throughout the day, in short, a product for each occasion and for every consumer. BIL saw an
opportunity in the dairy segment as it had only one large player, Amul. Its strategy was to build on the
strong affinity that Indian consumers had for milk and milk products in its diary venture. BIL wanted to
do in dairy products what it has done in biscuits: cover all segments. Said Alagh “As with other large
markets, we will seek to segment the market for dairy products too. This could mean that our portfolio
will include premium brands, with a high degree of value-addition, as well as popular-priced brands that
could add critical mass.” BIL entered the dairy segment in 1997 with cheese and milk powder or dairy
whiteners. By 2000, BIL captured about 35% of market share of the cheese market and 20% in the dairy
whitener segment. It launched butter in 1998, flavored milk, sub-branded ‘zipsip’ in tetra packs in 1999
and ghee in February 2000. The company relaunched its entire dairy business in late April 2000 by
bringing it under the ‘Milkman’ name. The pricing, communication, package, design had all been
revamped. The word ‘flavored’ was dropped from the milk range, as research had shown that in India,
the word ‘flavored,’ connoted ‘artificial’ to consumers. BIL’s diversification reflected its parent, Danone’s
portfolio. Ever since it got control of BIL, Danone had been providing it technology in biscuits and
pastries. Danone’s biggest business, dairy products, was the driving force for BIL’s diversification.
However, dairy products accounted for a meagre 9% of BIL’s turnover. But BIL hoped that was going to
change. Said Alagh, “In the next 3 years, we expect new businesses to contribute about a quarter of our
turnover.”
The Road Ahead
BIL’s makeover plan seemed to have worked well. The sales increased from Rest 752.3 crore in 1996-97
to Rest. 1169 crore in 1999-00 and net profits increased almost 4 times since 1996-97. Although BIL’s
biscuit business seemed to have done well, its diversification into dairy segments did not seem to be an
unqualified success. Analysts observed that the value-added dairy market which BIL had targeted was a
minuscule 0.10 per cent of the market. While the size of the cheese market was a mere Rest 140 crore,
it was growing at 20 per cent per annum. The Rest 400-crore butter market was growing at 10 per cent a
year, and Amul-the only national butter brand-had an 85% share. The Rs 350-crore dairy-whitener
market was growing at 10% a year, but large brands like GCMMF’s Amulya (market share: 45%), Nestle’s
Everyday (32%), and HLL’s Milkana (14 %) dominated it. Analysts felt that for BIL, using brand equity
alone to break into competitors’ domain, may not be that easy. BIL had to make sure that the products it
made were acceptable to Indian tastes. The mere fact that a product in its parent, Danone’s portfolio
was successful abroad was no guarantee that it would succeed in India. The best example, analysts
pointed out, was that of ‘Mini roule,’ a Swiss roll from Danone, which failed to take off, in India.
BIL, however seemed to believe that its core competence was foods, and that by going into dairy
products, it was not moving from its original focus. BIL also believed that its makeover plan had worked
well, and that this was reflected in the remarkable improvement in profits. Accordingly, it set ambitious
targets for the future. Said Alagh, “Our vision is to make every third Indian a Britannia consumer within
the next three years …We want to be part of our consumer- at home, out of home, a natural part of his
life. Consume the product of your choice, but consume Britannia.” Analysts felt that the challenge for BIL
lay, in continuing to remain aggressive and in evolving to meet the needs of dynamic markets of the new
millennium. If BIL was to achieve the objective it had set for itself, it had to continuously strive to deliver
products with value that exceeded consumers’ expectation. BIL’s gamble and its long-run success would
ultimately depend on whether consumers liked the new products it introduced in the market or not.
CHAPTER: 4
CHOOSING Brand Elements
to build Brand Equity
To Sum up…
 Entire set of brand elements makes up the brand identity
 Cohesiveness of the brand identity depends on the extent
to which the brand elements are consistent
 Each brand element plays a different role in building brand
equity, so marketers should “mix and match” to maximize
brand equity
 Red Bull ?
 Gives you wings?
©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Types of Brand Elements
Brand Names
URLs
Logos and
Symbols
Characters
Slogans
Jingles
Packaging
©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Designing a Branding Strategy

How a brand element is linked (if at all) to multiple
products across products and markets





Use brand element “as is” – Nivea, Kellogs
Adapting the brand – Ex. HP DeskJet, ThinkJet,
PaintJet; iPad, iPod, McNuggets, etc.
Common Symbols – use of corporate logo
Logical ordering – Ex. BMW 3, 5, 7 series
Chosen product descriptor – Quicken Deluxe, Quicken
Premier, / Chex cinnamon, Chex honey, etc.
Designing Supporting Marketing
Programs
Key Issue: desired awareness & image at each
hierarchy level
– Relevance – generally desirable to create relevant
associations at corporate or family level – used
across categories
• Ex. Nivea = gentle, mild ; Cellular = anti-aging
– Differentiation – disadvantages of redundancy
• Potential for consumer confusion
• Ex. Tropicana OJ – Pure Premium v. Grovestand or
Season’s Best – do we need all these individuals???
Criteria for Choosing Brand Elements
©2013 Cengage Learning. All Rights Reserved. May not be sca …
Purchase answer to see full
attachment

Order your essay today and save 10% with the discount code ESSAYHSELP