Abstract: The case is about Jayanagar Dairy Union Ltd (JDUL), a producer-owned dairy cooperative union under the umbrella of XYZ Rajya Dairy Federation that was set up as part of India’s dairy development program, the Operation Flood. Implemented by the National Dairy Development Board (NDDB), Operation Flood sought to link milk producers to urban markets through modern dairy processing and marketing infrastructure. Operation Flood was implemented through a three tier institutional structure that consisted of district level milk producers cooperative unions and state level milk producers federations across the country. The case also highlights marketing challenges faced by dairy unions which is the middle tier in the institutional structure for cooperative dairy business in India.
JDUL was one such medium-sized dairy union with good infrastructure for procurement, processing and marketing of milk and other dairy products in the region. The dairy cooperative union marketed milk to the household consumer market and the institutional market. JDUL used a variety of marketing strategies to enhance its market position. While quantity of sales had increased, the senior managers endeavoured to strengthen and increase market penetration in the household consumer market for business growth. Market study was undertaken, and a strategic marketing plan was being developed as per the emphasis of NDDB. Consumer behaviour was complex and had to be met. The senior managers perceived that market growth could come only from higher penetration of household consumer market. Choosing the right target segment and positioning platforms were challenges. These have to be done without compromising the social commitment of cooperatives to market quality milk to consumers at fair prices