PARAG MILK FOODS: DRIVING GROWTH THROUGH BRAND
BUILDING IN INDIA’S DAIRY INDUSTRY CASE STUDY
SOLUTION
e
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SYNOPSIS
m
Sa
Akshali Shah, the daughter of Devendra Shah, who was the owner and promoter of Parag Milk Foods
(PMF), was excited about the success of the company’s new “Pride of Cows” brand, which, despite being
a super-premium brand, was growing rapidly in the Indian market. The year 2019 had been a good one for
n
PMF, as its other brands—namely, the “Gowardhan” and “Go” brands—were also performing well.
However, Akshali’s mind was continuously distracted by the thought of scaling up and determining what
tio
should be next for PMF. The Indian dairy market was primarily focused on liquid milk, and it was highly
commoditized due to the lack of differentiation and premiumization. In addition, a large portion of the
market was unorganized or dominated by cooperatives. In such a complex and low-margin market, PMF
lu
had started its operations in the western part of the country by creating the Gowardhan brand. The company
had then grown from having one value-for-money brand to having many brands in its portfolio. Future
So
The Case Solution Starts From page 5
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m
Sa
n
tio
lu
So
ASSIGNMENT QUESTIONS
1. Analyze the dairy industry in India and the opportunities therein.
2. Differentiate between the brand strategies for PMF’s three brands: Gowardhan, Go, and Pride of Cows.
3. Why was whey protein an important portfolio item for PMF?
4. What are the possible options for PMF’s growth? Which option would you recommend and why?
The Case Solution Starts From page 5
, e
pl
ANALYSIS
m
1. Analyze the dairy industry in India and the opportunities therein.
Sa
In India, the dairy sector is highly
unorganized, with small towns and cities still being serviced by neighborhood milkmen who rear cows and
buffalos and sell the milk to make a living. The branded dairy market began with the milk revolution and
the growth of both cooperatives and regional dairy brands.
n
tio
Points to discuss and cover in class regarding the dairy industry:
India is a leading dairy-producing nation and accounts for almost 21 per cent of the world’s
lu
production of milk and milk products. India’s milk consumption mainly consists of cow milk (50.0 per
cent), closely followed by buffalo milk (46.8 per cent).2 Cow milk is also the preferred milk globally.
So
This presents an opportunity for exports and innovations in the dairy sector.
Consumption of dairy products is higher in urban India than in rural India, which could be due to the
greater emphasis on health and higher disposable incomes in urban areas. Despite the growing
popularity of Western products, fresh milk and traditional products are still preferred and consumed
more than Western alternatives (e.g., tofu, soya milk; see Case Exhibits 1 and 2).
Liquid milk and ghee constitute 67 per cent of consumption within the dairy category (see Case Exhibit
The Case Solution Starts From page 5
, e
pl
EXHIBIT -3: ANSOFF MATRIX
Old Market
m New Market
Sa
Market Penetration
Parag Milk Foods can use this
strategy for PoC brand by
increasing distribution in its core
cities and increasing the
n
communication focus to increase Market Development
brand awareness. In addition, it is a Parag Milk Foods can use this
tio
Old Product
suggested strategy for the strategy for POC brand by increasing
Gowardhan brand, which is distribution to other cities.
established and focuses on value
lu
and traditional segment.
Maintaining distribution prowess
and communication focus for this
So
brand is important.
New Product
The Case Solution Starts From page 5
BUILDING IN INDIA’S DAIRY INDUSTRY CASE STUDY
SOLUTION
e
pl
SYNOPSIS
m
Sa
Akshali Shah, the daughter of Devendra Shah, who was the owner and promoter of Parag Milk Foods
(PMF), was excited about the success of the company’s new “Pride of Cows” brand, which, despite being
a super-premium brand, was growing rapidly in the Indian market. The year 2019 had been a good one for
n
PMF, as its other brands—namely, the “Gowardhan” and “Go” brands—were also performing well.
However, Akshali’s mind was continuously distracted by the thought of scaling up and determining what
tio
should be next for PMF. The Indian dairy market was primarily focused on liquid milk, and it was highly
commoditized due to the lack of differentiation and premiumization. In addition, a large portion of the
market was unorganized or dominated by cooperatives. In such a complex and low-margin market, PMF
lu
had started its operations in the western part of the country by creating the Gowardhan brand. The company
had then grown from having one value-for-money brand to having many brands in its portfolio. Future
So
The Case Solution Starts From page 5
, e
pl
m
Sa
n
tio
lu
So
ASSIGNMENT QUESTIONS
1. Analyze the dairy industry in India and the opportunities therein.
2. Differentiate between the brand strategies for PMF’s three brands: Gowardhan, Go, and Pride of Cows.
3. Why was whey protein an important portfolio item for PMF?
4. What are the possible options for PMF’s growth? Which option would you recommend and why?
The Case Solution Starts From page 5
, e
pl
ANALYSIS
m
1. Analyze the dairy industry in India and the opportunities therein.
Sa
In India, the dairy sector is highly
unorganized, with small towns and cities still being serviced by neighborhood milkmen who rear cows and
buffalos and sell the milk to make a living. The branded dairy market began with the milk revolution and
the growth of both cooperatives and regional dairy brands.
n
tio
Points to discuss and cover in class regarding the dairy industry:
India is a leading dairy-producing nation and accounts for almost 21 per cent of the world’s
lu
production of milk and milk products. India’s milk consumption mainly consists of cow milk (50.0 per
cent), closely followed by buffalo milk (46.8 per cent).2 Cow milk is also the preferred milk globally.
So
This presents an opportunity for exports and innovations in the dairy sector.
Consumption of dairy products is higher in urban India than in rural India, which could be due to the
greater emphasis on health and higher disposable incomes in urban areas. Despite the growing
popularity of Western products, fresh milk and traditional products are still preferred and consumed
more than Western alternatives (e.g., tofu, soya milk; see Case Exhibits 1 and 2).
Liquid milk and ghee constitute 67 per cent of consumption within the dairy category (see Case Exhibit
The Case Solution Starts From page 5
, e
pl
EXHIBIT -3: ANSOFF MATRIX
Old Market
m New Market
Sa
Market Penetration
Parag Milk Foods can use this
strategy for PoC brand by
increasing distribution in its core
cities and increasing the
n
communication focus to increase Market Development
brand awareness. In addition, it is a Parag Milk Foods can use this
tio
Old Product
suggested strategy for the strategy for POC brand by increasing
Gowardhan brand, which is distribution to other cities.
established and focuses on value
lu
and traditional segment.
Maintaining distribution prowess
and communication focus for this
So
brand is important.
New Product
The Case Solution Starts From page 5
