PROJECT ON

MARKETING MANAGEMNET II

SAINTGITS INSTITUTE OF MANAGEMENT

PROJECT 1

Submitted by:
Lia susan joseph
Geyo pauly

Submitted to:
Ms.shino abraham
Asst. Professor, SIM

Submitted on:
30-03-2020
PROJECT CONCEPT

A distribution channel means the chain of business or intermediaries through which a good or service passes
until reaches the end consumer” Success of each company lies on various aspects, among these the
distribution channel is the most important one. Distribution channel is a chain of intermediaries; each
passing the product down the chain to the next organization, before it finally reaches the consumer or end-
user. This process is known as the ‘distribution chain’ or the channel’. Each of the elements in these chains
will have their own specific needs, which the producer should consider, along with those of the all-important
end-user or consumer. Each company had their own distribution channel for their product marketing, it
differ from other companies. Every company wants to know effectiveness of distribution channel of its
product. If the distribution channel is not effective, the company cannot perform very well in the market.
For better sale of its product in the market, the company must formulate different strategies for the
distribution channel. A company can coordinate and formulate different activities in the distribution
channel. this project should focus on the P&G company distribution channels and the promotion decisions
of nestle company this project focus on the documentation of the project and industry introduction and
company marketing polices in marketing distribution of that company nestle is a fast moving consumer
goods product.

DOCUMENTATION OF PROJECT

Distribution includes all activities undertaken by the producer, alone or in cooperation, since the end of the
final finished products or services until they are in possession of consumers. The distribution consists of
the following major components: Distribution channels or marketing channels, which together form a
distribution network; Logistics physical distribution. In order to effective achieve, distribution of goods
requires an amount of activities and operational processes related to transit of goods from producer to
consumer, the best conditions, using existing distribution channels and logistics system. One of the essential
functions of a distribution is performing acts of sale, through which, with the actual movement of goods,
their change of ownership takes place, that the successive transfer of ownership from producer to consumer.
This is an itinerary in the economic cycle of goods, called the distribution channel. Distribution is vital to
the success of FMCG companies. Ensuring that they deliver to customers their brands in the correct amount,
the place and right time, in good condition and at a competitive price, is still a challenge for the trade
marketing and distribution companies department. Also, the distribution is important for business partners,
including independent distributors, the relationship with them based on the principle of mutual profit.
FMCG companies have three objectives in terms of distribution: Brands’ availability Brands Effective
distribution of price viewpoint - making the availability and quality of products

INDUSTRY INTRODUCTION

The Fast Moving Consumer Goods (FMCG) industry primarily deals with the production, distribution
and marketing of consumer packaged goods, i.e. those categories of products that are consumed at regular
intervals. Examples include food & beverage, personal care, pharmaceuticals, plastic goods, paper &
stationery and household products etc. The industry is vast and offers a wide range of job opportunities in
functions such as sales, supply chain, finance, marketing, operations, purchasing, human resources, product
development and general management.

In India, the FMCG industry is the fourth largest sector with a total (organized) market size of over US$15
billion in 2007, as per ASSOCHAM, and can be classified under the premium and popular segments. The
premium segment (25%) caters mostly to the higher/upper middle income consumers while the price
sensitive popular or mass segment (75%) consists of consumers belonging mainly to the semi-urban or rural
areas who are not, and cannot afford to be, brand conscious. The market growth over the past 5 years has
been phenomenal, primarily due to consumers’ growing disposable income which is directly linked to an
increased demand for FMCG goods and services. Indeed, it is widely acknowledged that the large young
population in the rural and semi-urban regions is driving demand growth, with the continuous rise in their
disposable income, life style, food habits etc. On the supply side, the wide availability of raw materials,
vast agricultural produce, low cost of labour and increased

Fast moving consumer goods (FMCG) are the fourth largest sector in the Indian economy. There are three
main segments in the sector – food and beverages which accounts for 19 per cent of the sector, healthcare
which accounts for 31 per cent and household and personal care which accounts for the remaining 50 per
cent.

The FMCG sector has grown from Rs 2,20,852.4 crore (US$ 31.6 billion) in 2011 to Rs 3,68,669.75 crore
(US$ 52.75 billion) in 2017-18. The sector is further expected to grow at a Compound Annual Growth Rate
(CAGR) of 27.86 per cent to reach Rs 7,24,759.3 crore (US$ 103.7 billion) by 2020. FMCG market is
expected to grow at 9-10 per cent in 2020. FMCG urban segment witnessed growth rate of 8 per cent
whereas rural segment grew at 5 per cent in quarter ended in September 2019; supported by moderate
inflation, increase in private consumption and rural income.
Accounting for a revenue share of around 45 per cent, rural segment is a large contributor to the overall
revenue generated by the FMCG sector in India. Demand for quality goods and services have been going
up in rural areas of India, on the back of improved distribution channels of manufacturing and FMCG
companies.

COMPANY INTRODUCTION (Procter & Gamble)

The insight, innovation and passion of talented teams has helped us grow into a global
company that is governed responsibly and ethically, that is open and transparent, and that supports
good causes and protects the environment. This is a place where you can be proud to work and do
something that matters

Procter & Gamble Co., also called as P&G, which is a global leader multinational company in fast-moving
consumer goods. It includes many famous brands, such as Oral-B, Olay, SK-II, as well as Gillette and so
on. Also, the products are very popular because of its quality and innovation. At present, the products are
distributed in around 180 countries to approximate five billion consumers. The corporation has obtained
total Revenue of 76.27 billion US dollars in 2015 (Annual Report of P&G, 2015). It cannot be denied that
it has benefited from its excellent marketing mix, especially the place, which ensures the products are
available almost all over the world.

DISTRIBUTION CHANNEL AND PROMOTIONEL ACTIVITY

Distribution activity of Procter & Gamble

Procter & Gamble has a worldwide network for all its products with a distribution policy in place for at
least one hundred and forty countries like India, UK, China and USA. The company also has various
manufacturing plants for numerous products like a plant for manufacturing of hygiene products in Baddi
and Goa.
Procter & Gamble has a proactive and strong network for the distribution and manufacturing of its products.
It realizes the importance of prompt action and hence all its distributary strategies are well organized and
handled with efficiency. Distribution process is followed in three major ways intensive distribution,
specialty distribution and extensive distribution.

Procter & Gamble network channel consists of manufacturers, who are the producing agents, and from
them to the wholesalers who are the distributors and from them to retailers who are in fact the suppliers for
the consumers. For some brands, the marketing channel consists of independent organizations that are
participants in the product production process for consumer consumption. It is the responsibility of the
retailers to see that the goods are dispatched at a faster pace to the various outlets.Therefore, the warehouses
are at convenient places from where accessibility is easier. The main distributers of the goods to the
consumers are in fact the provision stores, the chemist’s shops, the retail outlets, the mall, and numerous
big markets. DHL courier is the company’s service provider to ensure logistical efficiency.

Promotions activity of Procter & Gamble

Procter & Gamble capitalizes heavily on the online media and insists on “attraction strategy”. Under this
advertising policy, the company insists on creative ads and heavy advertising. It has deals with celebrities
for its advertisements. Actors Kareena Kapoor and her actor husband Saif Ali Khan are in the Head &
Shoulder ads, actor Kaitrina Kaif is in ads for Olay and actor Shilpa Shetty and Parineeti Chopra are in the
Pantene ads shown in different television channels, radio, hoardings, newspapers and different
magazines.Procter & Gamble has been a sponsor for different television shows like Guiding Light, Our
Private World, Texas, Another World and The Caitlins. It also sponsored the first soap opera on the radio
in the year 1930. Under its online marketing strategy, the company has opened its official website where a
consumer can easily download any detailed information about any product of its sub brands and make
purchases.

The company also has tie-ups with numerous other shopping sites from where buying is possible. It has
become a sponsor of various online communities like “Women.com” and “BeingGirl.com” and even has
numerous destination sites that are highly stylized. The company has released small product pouches as
promotional ventures to create awareness in the consumer market for its products. Free samples as
promotion technique are distributed at numerous events to increase the visibility of the products.
Suggestions
1. Reducing operating leverage
2. Need to concentrate more on rural and emerging markets
3. Imitable products
4. Invest more on product innovation as well as marketing
5. Regular change is needed.