Launching High-Protein Curd in Lucknow
A Lucknow dairy cooperative sells 50,000 litres of milk a day, of which curd contributes 30% of revenue. It is considering a 200g high-protein curd cup (15g protein) for urban Lucknow. A household survey of 500 respondents shows 38% would pay ₹40 a cup; among gym-goers, willingness is 71%, but gym-goers are only 6% of households. Working women aged 25–40 are 18% of households and 44% would pay ₹35. Families with children are 31% and 22% would pay ₹35, mainly for taste. Amul already sells a protein curd at ₹35, and two local dairies sell ordinary curd at ₹20. The cooperative's variable cost is ₹18 per cup; packaging and cold-chain add ₹7; a 25% retail margin is expected. The cooperative can launch in 40 stores or run a direct subscription service for gyms. Management wants a clear target segment and positioning, not a product for everyone.
1. Evaluate the three segments using size, profitability and fit. Which segment should the cooperative target first, and why?
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Gym-goers: only 6% of households, but 71% willingness at ₹40 and likely high frequency of use. At ₹40 with a 25% retail margin, contribution is ₹40 − ₹10 − ₹25 = ₹5 per cup. A direct subscription at ₹42 with ₹4 delivery cost gives ₹42 − ₹4 − ₹25 = ₹13 per cup. Fit with a 15g protein claim is very high.
Working women aged 25–40: 18% of households and 44% willing at ₹35. At ₹35, contribution is ₹35 − ₹8.75 − ₹25 = ₹1.25 per cup. The segment is larger but price-sensitive, and the message would have to shift from gym performance to convenience.
Families with children: 31% of households, but only 22% willing at ₹35 and mainly for taste. A protein claim is not their main buying reason, so the fit is weakest.
Recommendation: target gym-goers first as a beachhead through gym subscriptions and trainer endorsements. The segment is small but profitable and gives credible early adopters. Extend to working women later only if repeat-purchase data supports a ₹35 pack; do not launch to all three segments at once.
2. Write a positioning statement and two marketing-mix actions that fit it.
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Positioning statement: For urban Lucknow gym-goers who want convenient post-workout protein, the cooperative's high-protein curd is the fresh curd with 15g protein and no added sugar, unlike mass-market curd, because it is delivered chilled to partner gyms and can be eaten immediately after training.
Action 1 - Gym subscription and sampling: tie up with 15–20 gyms, offer a trial cup after workouts, and take weekly subscription orders. This makes the product physically available at the moment of need and gives direct feedback on taste and repeat demand.
Action 2 - Pack and label proof: print “15g protein” prominently on the front, add a simple protein comparison with ordinary curd, and include a trainer endorsement. This makes the claim verifiable at the point of purchase and supports the premium over Amul.
Both actions reinforce the same position: fresh, high-protein, gym-linked. A family-size pack or a children's taste campaign would blur the position and should be avoided at launch.
3. Calculate contribution per cup for the ₹40 retail plan and the ₹42 direct subscription plan. Which launch channel should the cooperative choose first? Show your reasoning.
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Total variable cost per cup = ₹18 + ₹7 = ₹25.
Retail plan at ₹40: retailer margin = 25% × ₹40 = ₹10. Contribution = ₹40 − ₹10 − ₹25 = ₹5 per cup.
Direct subscription at ₹42: delivery cost = ₹4. Contribution = ₹42 − ₹4 − ₹25 = ₹13 per cup.
If fixed launch cost is, say, ₹2,00,000, the subscription route needs ₹2,00,000 ÷ ₹13 ≈ 15,385 cups to break even; the retail route needs ₹2,00,000 ÷ ₹5 = 40,000 cups. The subscription route also gives direct customer data and avoids fighting for shelf space against Amul.
Decision: launch first through gym subscriptions and use the 40-store retail option as a second phase for working women. The higher contribution and controlled cold chain make the subscription route the better first channel, even though its reach is smaller.