Amul to launch its D2C platform soon: Jayen Mehta

India’s largest dairy cooperative Gujarat Cooperative Milk Marketing Federation Limited, better known as Amul, is planning to launch its full-fledged D2C (Direct to Consumer) platform soon to boost its sales, Jayen Mehta, MD of Amul, said on Wednesday at the e4m Health and Wellness Marketing Conference 2023 in Mumbai. 

In a fireside chat with Dr Annurag Batra, Chairman & Editor-in-Chief of the BW Businessworld Group and the Founder & Editor-in-Chief of the exchange4media Group, Mehta said Amul has been offering e-commerce services since 1998. 

“That e-comm channel was very interesting. Amul was perhaps the first one in India to set up a ‘direct to consumer cyber store’ as we used to call it. Way back in 1998-99, we were in hundred cities of India delivering ice creams to your doorstep along with the butter and cheese. And this was before e-commerce came into the country. For payments, credit cards were accepted on the net and so on and so forth. We did this for 10-12 years.”

“Then, the formal e-commerce came in, and we started selling through those channels, and now we are coming back with our own e-shop or e-commerce channel in which we will be able to directly supply our products through our dedicated outlets and processing plants,” stated Mehta, whose cooperative reported a turnover of Rs 72,000 Cr in 2022-23. 

According to him, Amul already has 83 branch offices, hundreds of frozen warehouses, 98 dairy plants, apart from the million retail outlets and 15,000 distributors across India. So, we are already within a radius of 200 kms of every single city in India. Now all this is being made e-commerce compliant.”

“If you order something in the morning, you will get it by evening. The entire range of products would be easily available through this format. We are building our operations across the country, which makes us a very large e-commerce player also,” Mehta further said. 

Mehta said that Amul already has a software that connects it with 3.6 million farmers associated with the cooperative. The moment a farmer delivers the milk, software assesses the fat percentage in the milk and the price is credited to his/her bank account. Our one million outlets use the same software. So, we are a highly integrated “cow-to-consumer” company on a technology platform and this will now be consumer-enabled to make it fully available to everyone across the country.

Mehta said, “In every single household in India, the single largest component of food you spend on in your budget in a month is dairy products. So, this particular product needs to deliver all the four or five aspects-health, wellness, nutrition, energy and development. This is what the job is assigned to milk as a category. So, we are very conscious about it; the kind of products that we make, the kind of attempt that we make to highlight the goodness of milk as a superfood, as a very composite product, and then also talk about these parts.”

If somebody is interested in the energy part of it, then we have milk with different fat content. For lactose intolerants, we have a suitable product. Somebody is looking at products without sugar, we have that too. 

“We are very, very closely focusing on the evolving customer categories across different socioeconomic status, different life cycle, lifestyle, age, and try to create a portfolio around that which is very, very comprehensive, very composite. And more importantly, we have a mandate also to make the products available and affordable to all the Indians. So, this is an interesting challenge,” he noted. 

“Our currency is trust. And this is a trust on which the Amul plant is standing, trust of millions of our farmers who are owners. The 3.6 million farmers and a billion customers who are there. We strengthen this trust so that whatever we do is seen from the perspective of not a product but a support offering of an organization which is trying to cater to both the segments, the producer, as well as the consumer,” Mehta pointed out. 

Not almond milk, its beverage 

A section of nutritionists has been raising concerns that milk today is unhealthy as it contains carcinogenic substances and fat which helps in weight gain. Dr Batra asked Mehta, adding that such misconceptions have boosted the popularity of almond milk, soy milk, millet milk etc. 

Mehta responds, “There are a lot of people who want to attack milk and try to take away the share of the customers by perhaps misleading them. Technically, when the product is not of bovine origin, you can't call it milk. So, it's not almond milk, it can be called almond beverage. Milk is not just a source of nutrition for millions of consumers, but a source of livelihood for millions of producers as well.”

So, we have to provide the right information to the customer. Talk about the goodness of milk. Let the people who want to sell the alternatives do that because it's an open market. But you should not call it milk after all, as it is denigrating milk as a category. So, on their own, if the soya beverages can prove that they are good for the health of the customers or the well-being of those who want to consume, it's fine.

But we are very clear that as per the food safety laws of the country, you can't call any product which is not bovine origin as milk. You call it almond and soy beverages and then allow the customer to make a very conscious decision of buying any product. 

High fat milk is largest selling one 

Mehta surprised the audience by saying that Amul’s largest selling milk product is with very high fat. “Customers know the goodness of milk as a source of nutrition, as a source of energy, and as a source of making ghee. And that's what makes the product cutting across income groups and across market segments. And again, we did some surveys and found that people in the lower income segment consume the milk, which is the highest fat. And some people who are very conscious of calories would buy low fat milk. So, this is the paradox that we're looking at.”

Innovative products

Amul is currently focussing on probiotics, protein, and organics, Mehta stated. 

“Post-Covid, everybody realized the importance of immunity and probiotics that offer good immunity. Probiotics is a category which is supposed to be a very elite category, very expensive. Buttermilk has the best probiotics and we sell close to 3 million liters of buttermilk in simple pouches every day across the country.”

“We did a very, very dramatic thing overnight that bacteria in that buttermilk’s regular pouch is converted into probiotic. So, all the goodness of probiotic bacteria is available at a price point of just ₹30 a litre. No change in the price. More than 2 crore consumers are getting the benefit of probiotics without being anything extra. This is the innovation which the country requires to make India a stronger nation.”

High protein products 

The country is looking for protein sources. Amul is the largest player of milk in the country and milk has 3% protein. So, we have the largest protein player by default. We require one gram of protein per kg of our body weight every day but most of us are heavily deficient in protein.

You can't substitute the requirement of the country by importing the black protein and selling protein powder, which is at times dubious quality. We have started isolating the best quality protein with the highest BCAAS ratio, and that started the sale of high protein buttermilk.

We are coming out with a range of high protein yogurt, high protein cookies, high protein ice cream, high protein milkshakes, high protein milk and so on which will make a big difference in the availability of good quality protein at an affordable price in a tasty form across the country around the year, Mehta disclosed. 

Organics 

And the third is the moment on organics. We all want to eat food without any chemicals, without any pesticides, without any fertilizers and so on. That, unfortunately, is not there. If organics are available, they are very, very expensive. So, we have gotten to this space now. We are launching a range of 8-10 products in organics, which is organic wheat flour, rice, daal, besan, sugar, jaggery, masalas and so on. 

Amul Organic will be affordable and adhering to highest standards of quality and lab tested right from sourcing to the finished products.

Snacks and wafers

We are trying many other things which are not directly related to our business, but exist in the space of agricultural products, such as potato snacks, honey. All these things we are trying to bring in the goodness of what the farmer has to offer and the consumer is willing to try. 

Dark chocolate, zero ad budget 

We were very bad in the chocolate category 10 years back. So we realize that these are some of the categories where you cannot advertise on our billboards, in print and TV like we do for every product this year. Dark chocolate was launched and then it got popular by word of mouth. Young consumers started inquiring about it at retail shops forcing the retailers to keep the stock. 

“The customer has to be your evangelist. He or she will recommend it to his friends if he/she really likes the product,” he remarked, sharing Amul’s zero-budget marketing success.