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Deobhog: Developing Marketing Strategy for Achieving Excellence*

CASE STUDY, MARKETING MANAGEMENT
ET Cases - GSMC, 11 Pages
AUTHOR(S) : Dr. Sumeet Gupta, Dr. Sanjeev Prashar and Dr. Vinita Sahay, IIM Raipur

Case Preview

Deobhog: Developing Marketing Strategy for Achieving Excellence

 

“Distribution is the name of the game!”, said Mr. Kiran Sharma (Kiran) to the team of management consultants. Kiran, the head of marketing and distribution at the state cooperative dairy federation, Chhattisgarh got transferred from a smaller unit at Bilaspur to the head office Raipur, with a mandate to develop market for Deobhog in the central Indian state of Chhatttisgarh. Having recognized Kiran for developing market and marketing competencies at Bilaspur, the federation wanted him to take a bigger role and challenging responsibility of building market and the brand, ‘Deobhog’ at the state level.

In a series of meetings with the consultants, Kiran discussed the challenges in increasing market at the state level. As per Kiran, “if we improve the sourcing and distribution of Deobhog, we will have the market.” The consultants, however, thought more deeply. Deobhog was relatively a new and unknown brand with little awareness in the market about the offers and availability. Simple distribution won’t be enough.

Chhattisgarh State Cooperative Dairy Federation Limited


In 1985-86, Raipur Sahkari Dugdh Sangh Maryadit (RSDSM) was established by the National Dairy Development Board (NDDB) under the Operation Flood- Phase II Scheme. The main objectives of the cooperative were as follows:

  • Welfare of milk producers: It was established to ensure that milk producers got due revenue for their produce.
  • Rural development: The cooperative established various dairy cooperative societies in various villages. The producers in these villages became the members of the society and were trained and educated by the officers of the RSDSM, thus contributing to rural development.

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Marketing at Deobhog

CGSCDF did not have any specific marketing strategy of its own. Marketing and sales action for Deobhog had evolved inconsistently over the period............

Product

Though the federation produced a vast variety of milk and allied products, a product portfolio never existed. Mostly, it was randomly decided to produce allied products as and when needed or production system warranted. The product portfolio of Deobhog is present in Exhibit V and Exhibit V (a) presents the product portfolio of Amul..........

Price

Deobhog products were competitively priced; the price list of Deobhog’s products is present in the Exhibit VI. Decisions regarding pricing of convenience goods are critical in the competitive market. Milk is bought on a daily basis by most customers and they are price sensitive. Therefore, there was not much variation in pricing of various milk brands. The major players of milk in the local market were – Amul, Reliance, Dinshaw, Jursey, Apna/Pawan, Abiz............

Promotion

Deobhog was not a popular brand and did not have any specific marketing budget for its promotion. Even after two years of renaming of Deobhog from the erstwhile Sanchi, most people were not aware of the new brand. Compared to Deobhog, Sanchi still commanded trust and levels of awareness. Amul dominated the market and was considered a generic name for packaged milk..........

Place

Milk and its products being staple food fall under convenience goods. Convenience goods are widely distributed and relatively inexpensive and are purchased frequently with minimum effort. Deobhog distributed its products through three main types of channels: Level 0, Level 1 and Level 2.

Level 0: In level 0, Deobhog directly sold milk and its products to customers. These were sold through the booths, outlets or direct delivery to high volume customers like the Central Jail. The scope for improving this channel and major market in this category was still unexplored..............

Challenges

In 2012, Deobhog faced challenges from sourcing to processing to disribution, the federation had host of marketing issues. Its products didn’t have a distinctive positioning in the mind of the consumer. The awareness and visibility of its brand was poor. Despite good quality milk products, it failed to leverage it. They were perceived to be low quality. Packaging and labeling too were of poor quality. The products were supply driven and not market driven. It didn’t follow market forecasting that led to poor planning. Penetration in the market was extremely weak...............

Exhibits

Exhibit I: Milk Collection Routes

Exhibit II: Milk Chilling Centers and Their Capacity

Exhibit III: Average Monthly Sales of Milk and Milk Products

Exhibit IV: Supply Chain of Deobhog

Exhibit V: Deobhog's Products

Exhibit V: Amul's Product Portfolio

Exhibit VI: Price List of Deobhog Products

Exhibit VII: Commission provided to Retailer by Various Milk Brands

Exhibit VIII: Promotions of Deobhog through Wall Paints

Exhibit IX: Images of Deobhog Booths

Teaching Note Preview

Deobhog: Developing Marketing Strategy for Achieving Excellence

 

Synopsis

Deobhog – a brand of milk and allied products in Chhattisgarh was facing existential crisis. Since its inception in 2011 after rebranding from its earlier name ‘Sanchi’, Deobhog was marred with multiple issues like lack of product quality, poor packaging, fractured distribution and sourcing, inconsistent and at times non-existent marketing strategies, lack of brand awareness. Moreover, India’s largest milk brand Amul, which offered superior quality products, had already established a stronghold in the Chhattisgarh market. Internal failures to steer the company on the right track by devising strategies, coupled with threat from the market leader had landed Deobhog in a sea of problems, but the most important question was – how and from where to start?

Expected Learning Outcomes

The case study shall expose the students with the understanding on:

  • • Situations due to which sales of product can stagnate
  • • Crafting the 4Ps (Product, Price, Place and Promotion) for an effective marketing mix
  • • Requisite marketing strategies of market challengers

 

Case Positioning and Setting

The students pursuing postgraduate diploma/degree in Management are the target learners for the case. The courses applicable here are Marketing Management and Brand Management. However, the same may also be taken for deliberations in Sales and Distribution Management.

Assignment Questions

  • I. Why products stagnate in their sales?
  • II. What will be Deobhog’s strategy to deal with Amul?
  • III. ....................

 

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Abstract

This case study is meant to introduce the participants to the challenges involved in expanding the market for milk Cooperative Society in Raipur, Raipur Sahkari Dugdh Sangh Maryadit (RSDSM). Kiran, who has been hired to navigate through the competitive landscape, faces myriad challenges. In 2012, Deobhog faced challenges from  sourcing, processing and distribution, the federation had host of marketing issues. Its products didn't have a distinctive positioning in the mind of its consumers. The products were supply driven and not market driven as a result the awareness and visibility of its brand was poor. Despite having good quality milk products, it failed to leverage it. They were perceived to be low quality due to the poor quality of packaging and labeling. It didn't follow market forecasting that led to poor planning. Penetration in the market was extremely weak. The per capita consumption of milk in Chattisgarh was very low. People purchased milk mostly for tea and coffee. Moreover, people preferred loose milk from milkmen as they felt that packaged milk contained preservatives and would not be easily digestible for children. What strategies should the federation implement to create awareness and to build the brand?


Pedagogical Objectives

The objective of this case study is to facilitate the reader’s understanding of the marketing mix of Deobhog milk. This case study has the Chhattisgarh State Cooperative Dairy Federation Limited (CSCDFL) as the parent organization, the senior decision-makers of which have to decide the future course of action to build the brand ‘Deobhog’.


Case Positioning and Setting

This case study can be used for post graduate or under-graduate students of Business Management Course. It can also be used for Management Development Programs on developing marketing strategy for achieving excellence. A 60-minute session with previously distributed assignment questions would be adequate.


* GSMC 2016, IIM Raipur

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- Abstract
- Case Study
- Teaching Note (**ONLY for Academicians)
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