ITC MARKETING STRATEGIES

ITC MARKETING STRATEGIES AND THERE POSITIONING

1. By: MANISH POOJA NEHA NINAD GIRISH

2. Chairperson : Y C Deveshwar Directors : S S H Rehman , Nakul Anand , A Singh, PV Dhobale , K Vaidyanath , K N Grant, A Baijal , B Vijayaraghavan J P Daly, H G Powell, P B Ramanujan , B Sen , R S Tarneja ,

3. HISTORY ITC was incorporated on August 24, 1910 under the name Imperial Tobacco Company of India Limited. Name changed from Imperial to Indian tobacco comapany in the year 1970 then to ITC limited in the year 1974. One of the 8 Indian Companies to feature in ‘Forbes A-list’ for 2004 Only Indian FMCG Company to feature in Forbes 2000 List Among top in : Sustained value creation (BT-Stern Stewart survey) Operating profits Cash Profits Ranks No. 4 among Indian listed Private Sector Companies by market cap. (@ April 09) No. 1 in FMCG Sector Rated as one of India’s Most Respected Companies (IMRB- Businessworld Survey 2006) Diversified conglomerate with interests ranging from Tobacco to Hospitality

4. INDIAN TOBACCO COMPANY 24 Aug1910 – ITC incorporated under the name of 'Imperial Tobacco Company of India Limited'. 1925– ITC’s Packaging & Printing Business Division was set up as a strategic backward integration for ITC’s Cigarettes business. 1974 – The Company's ownership progressively Indianised , and the name of the Company was changed to ITC Limited (Indian tobacco company). 1975 – The Co. launched its HOTEL BUSINESS which was named ‘ITC- Welcomgroup Hotel Chola ’. 1979 – ITC entered the Paperboards Business by promoting. ITC Bhadrachalam Paperboards Limited, which today has become the market leader in India.

5. CIGARETTES 6 Market leader in India. Highly portfolio of brands includes Insignia, India kings, Classic, Gold Flake, Silk Cut, Navy Cut, Scissors, Capstan, Berkeley, Bristol and Flake.

6. WHY HOTELS AND TOURISM????? ITC. Touching your life. Everyday

7. BRAND CATEGORY POSITIONING ITC HOTEL LUXURY COLLECTION MANSION OF LUXURY WELCOME HOTEL SHERATON UPPER UP SCALE PASSION FOR QUALITY FORTUNE HOTEL UPSCALE -MIDSCALE PROMISE OF TRUE VALUE WELCOME HERITAGE HERITAGE UNIQUE EXPERIENCES

8. WHY FMCG????? Entering the foods business was itself a strategic decision for ITC. ITC‟s core business, tobacco, was under pressure owing to several factors like government bans on advertising and on smoking in public places. Hikes in the excise duty for cigarettes, and anti tobacco campaigns, ITC planned to deploy its surplus in the packaged food business where it saw huge business potential.

9. FMCG PRODUCTS

10. 2004 - 05 200 5 - 06 2006 - 07 200 7 - 08 2008 - 09 200 9 - 10 2010 - 11 201 1 - 12 2012 - 13 5545 7012 Rs. c r s Rapid share of FMCG business 20 563 1013 1704 2511 3014 3642 4482

11. MARKETING STRATEGIES DISTRIBUTION NETWORK Huge distribution network due to its tobacco business. Today, ITC‟s Bingo and Sunfeast are available at nearly 1.8 million outlets whereas Parle is available at only 1.5 million outlets.

12.  Market differentiation In Biscuits also, ITC launched differentiated products in each and every segment. For e.g. it introduced an Orange Marie, a butterscotch cream biscuit, chilli flakes in a biscuit and even honey flavor under the Sunfeast brand. In March 2005, ITC Foods launched Sunfeast Pasta, a whole wheat based product targeted at children. It was expected to compete with products like Nestle‟s Maggie noodles. With this strategy ITC built for itself new markets.

13. Cost control strategy ITC realized that they have to offer products at a price which is either equal or less than what the competitors are offering. ITC‟s printing and packaging business provided high-quality, cost-effective, and innovative packaging. ITC also enjoyed cost advantages over its competitors owing to its electronic procurement system called e- Choupal .

14. Diversification of products Bingo, ITC has come up with 21 flavors in comparison to its competitor „Lays‟ of „Frito Lay‟ which has only 4 major flavors. Extensive advertising They hired the best professionals and the best ambassadors in the country to make their products famous. The tagline "Jab Laila ko karna tha impress to majnu ne khayi mint o fresh" has stood the test of times and is still widely known and remembered. 10 to 15 spots per channel per day on youth channels such as MTV and Star World, mass Hindi channels like Zee and Star TV, and news 19 channels. It also had around 20 spots on a variety of radio channels and advertised in most leading national dailies. Top-30 cities, over 1,000 outdoor hoardings advertised the product. ITC spent close to Rs 100 crore on marketing.

15. Regular introduction of new products ITC has been expanding its distribution network aggressively and also their product range. In biscuits and wafers range, it is launching new products or flavors week after week. Innovation ITC was innovative in identifying the market or niche for all its products.

16. AGRO BASED INDUSTRY

17. Basic components of ITC are from the agricultural sector. Cost reduction strategy. Direct raw material without involvement of third party. Direct touch with farmers.

18. ITC e- Choupal Started in the year 2000 Target Area so far 38,000 villages, 6500 kiosks, 9 states Wholly owned by ITC Why it become a success ? Only initiative to attempt to combine Services and an Effective Business Model successfully Designed to address the issues such as: Fragmented farms Weak institutions Involvement of intermediaries Information Asymmetry

19. A win-win Deal

20. Transaction cost in Mandi Chain ( before e- Choupal )

21. Transaction cost in Mandi Chain ( after e- Choupal )

22. SWOT ANALYSIS Strength Cigarette market is 22,000 cr and ITC has lion’s share in it Strong brand recognition and product portfolio Distribution network Management Weakness Dependence on tobacco revenues Negative Connection of Tobacco Opportunity Consumption Of personal care products Rural Market E- Choupal  Filter cigarette segment of less than 60mm size Threat Competition both Domestic & International Increasing Tax on cigarettes Excise duty on unfiltered cigarettes less than 60mm in length was increased 387% last year Hike was 142% for those between 61mm and 70mm long. Regulatory restrictions on cigarettes Ban on smoking

23. ITC. Touching your life. Everyday

24. THANK YOU

25. ITC. Touching your life. Everyday