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Buying Behavior and Perception of FMCG Aavin Dairy Products: A Study with
Special Reference to Chennai

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Consumer Buying Behavior and Perception of FMCG Aavin.......... Rajalakshmi and Anthony

Consumer Buying Behavior and Perception of FMCG Aavin

Dairy Products: A Study with Special Reference to Chennai

V. Rajalakshmi S. Anthony Rahul Golden

Research Scholar (Part-time) Assistant Professor
Periyar University Periyar University
Mar Gregorios College of Arts & Science LOYOLA College (Autonomous)
Chennai, Tamil Nadu Chennai, Tamil Nadu
 vrajalakshmi.ap@gmail.com  kvsrahul@gmail.com

ABSTRACT
By providing milk to the entire population, milk agribusiness has consistently has been the foundation of the
system of Indian economy. Since dairy production produces milk in accordance with demand, it has a direct impact
on poverty alleviation. Regardless of whether it is favourable or bad, the adoption of the agricultural part will have
a multiplier wave that will affect the entire economy. Additionally, associated industries like dairy, agribusiness,
and animal development are actively working to improve the overall financial situation of average India. Viable
and balanced progress in growing and cooperative segments is required to maintain the ecological evening out.
Coordinators have promised to bring the division together for the financial improvement of the national division
since our initial preparation. The development of dairy products is presented as a small invention that creates
lucrative job opportunities.
The best dairy substantial discovery in India. Given the significant difficulty, all associations, regardless of size,
must periodically assess the temperament, inclinations, and movement tendencies of their clientele. The relative
quality item at a lower cost noticeable quantity, according to the buyer’s perspective. This study focuses on
Chennai, Tamil Nadu, and consumers’ perceptions of Aavin products. The quick rise in new milk product names
is a reflection of India’s milk industry’s extraordinary growth. Milk brands may boost sales and ensure complete
customer happiness with the aid of consumer perception. The belief that consumers hold when they search for,
utilize, evaluate, and reject Consumer perception refers to meet the consumers believe their need of goods and
services. A standardized questionnaire was employed to gather the study’s main data from Chennai’s Aavin clients.
The study’s conclusions make it abundantly evident that a number of variables, including product attributes, cost,
quality, variety, and services, are related to consumer impression. Suggestions are made to increase client happiness
KEYWORDS: Aavin, Dairy products, Customer satisfaction, Perception.

INTRODUCTION Nadu Co-operative Milk Producers’ Federation Limited

D
(Aavin) in 1981, signify the state’s commitment to
airy products play a crucial role in the Indian
enhancing the dairy industry [2](Rangasamy & Dhaka,
economy, particularly due to their contribution to
2008). Aavin has been integral in meeting the increasing
nutrition and poverty alleviation through agricultural
demand for dairy products, driven by consumer needs
activities. The dairy sector, encompassing both large-
for quality and affordability.
and small-scale enterprises, serves as a foundation for
economic growth and job creation, offering significant Consumer perception plays an essential role in
employment opportunities [1](Zhong, Chen, & Kong, purchasing decisions, influencing both the retention of
2013). The Department of Dairy Development in Tamil existing customers and the attraction of new ones [3]
Nadu, established in 1958, and the formation of the Tamil (Susanty et al., 2017). Understanding this perception

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Consumer Buying Behavior and Perception of FMCG Aavin.......... Rajalakshmi and Anthony

helps organizations to tailor their strategies to meet Given the competitive nature of the dairy industry,
consumer expectations, thus boosting customer it is imperative for brands like Aavin to regularly
satisfaction and loyalty [4](Ahila & Boopathib, 2015). assess consumer feedback and adapt their practices
As consumers’ choices are influenced by various factors accordingly to remain relevant (Karthikeyan, R. 2019).
such as price, taste, and packaging, examining these This study focuses on analyzing consumer perception
elements can provide valuable insights into how dairy and satisfaction with Aavin products in Chennai,
brands like Aavin can enhance their market presence [5] highlighting key factors such as quality, price, and
(Elangovan & Gomatheeswaran, 2015). availability that influence consumer behavior. The
objective is to provide insights into strategies that can
The empirical model examining business performance, be adopted by Aavin to optimize their operations and
loyalty, and trust within the dairy milk supply chain foster customer loyalty in a highly competitive market.
highlights key challenges, particularly due to the lack
of effective identification processes between milk OBJECTIVES OF THE STUDY
cooperatives and dairy farmers. This gap can lead to 1. To assess customer perception of Aavin products.
conflicts of interest and exacerbate managerial issues,
2. To evaluate customer satisfaction with Aavin dairy
particularly in the Chennai dairy sector. The conduct of
products.
dairy farmers and cooperatives in trading interactions
underscores the necessity for cooperative leaders to 3. To explore purchase perceptions of Aavin products.
implement transparent and accountable strategies 4. To examine the loyalty, brand image, and credibility
regarding milk pricing and operations, even if not of Aavin products.
mandated. Such strategies are essential to maintain trust
and foster cooperative stability. HISTORY OF THE STUDY
Executives of dairy cooperatives do not need to The Department of Dairy Development in Tamil Nadu
constantly consider farmers while making display- was established in 1958 to oversee and support the
based decisions, particularly when it comes to costs, state’s dairy sector. On August 1, 1965, this department
products, advertising, and progress. In light of the dairy assumed full administrative and legal authority over all
milk cooperatives within the state, further strengthening
industry’s long-term flexibility, it is advised that dairy
its role in regulating and managing dairy activities. The
cooperatives include the milk estimation by that time
establishment of the Administrator for Milk Production
in order to expand their market reach and boost public
and Dairy Development was formalized under the
returns.
Tamil Nadu Cooperative Societies Act, which aimed to
Now a day’s customers play a great role in decision streamline the operations of cooperative societies and
making. And more than the needs & wants of the enhance dairy production and management.
customer it is an emotions and feelings of the consumer In line with the ‘Anand Plan’ model, the Tamil Nadu Co-
towards a specified brand or products influence more operative Milk Producers’ Federation Limited, popularly
while making a purchasing decision. Therefore, the most known as “Aavin,” was founded on February 1, 1981.
crucial aspects on which a business should concentrate This federation was tasked with a comprehensive set of
in demand to maintain its current clientele and draw responsibilities, including the procurement, processing,
in new ones is customer impression. In the end, it is chilling, packaging, and distribution of milk and dairy
an inevitable component that determines a company’s products to consumers. Over time, the federation
profitability. The phrase “customer perception” in evolved to manage the operational needs of the dairy
marketing refers to the attitude, feeling, emotions, sector and ensure the delivery of quality dairy products.
impression, awareness, etc. that a customer has of a The involvement of private dairies in recent years has
brand or product. Customer perception, to put it simply, also brought competitive dynamics to the industry,
is what current and potential customers believe about underscoring the need for strategic improvements
the business and its offerings. and streamlined processes within the cooperative

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Consumer Buying Behavior and Perception of FMCG Aavin.......... Rajalakshmi and Anthony

model. The Hon’ble Chief Minister of Tamil Nadu farmers and cooperative members, the research can
has emphasized the importance of adopting structured help shape policies that strengthen mutual trust and
methods and robust systems to bolster the efficiency of commitment. Improved loyalty can lead to more
milk cooperatives. consistent milk supply and cooperative growth,
The cooperative societies, unions, and the overarching benefiting both farmers and consumers.
federation in Tamil Nadu have collectively achieved 3. A significant portion of the study is dedicated to
significant milestones in dairy production. Tamil Nadu understanding consumer perceptions of Aavin’s
stands as one of the leading milk-producing states products. Consumer trust in dairy products impacts
in India, with a daily output exceeding 14.5 million purchasing behavior, brand loyalty, and market
gallons. The Tamil Nadu Cooperative Milk Producers’ expansion. Insights from this research can guide
Federation Limited, through its brand Aavin, has Aavin in improving product quality, branding
played a critical role in this success. Annually, Aavin strategies, and customer engagement, enhancing its
processes and markets approximately 5,994 liters of competitive position in the dairy market.
milk and procures an average of 33 liters per day from
its producers. Moreover, Aavin has expanded its reach 4. The findings can be instrumental for policymakers
by exporting milk to several countries, contributing to and administrative bodies in designing better
the global footprint of Tamil Nadu’s dairy industry. regulatory frameworks that support both dairy
farmers and cooperatives. With the guidance of
IMPORTANCE OF THE STUDY the Hon’ble Chief Minister of Tamil Nadu and
This study holds significant importance as it delves cooperative leaders, the study’s recommendations
into the operational, economic, and social aspects could lead to the development of comprehensive
of the dairy supply chain within Tamil Nadu, with a and well-governed strategies that align with
particular focus on Aavin, the state’s cooperative dairy industry best practices and local needs.
federation. Understanding the dynamics between milk 5. As one of India’s leading milk-producing states,
cooperatives and dairy farmers is crucial in enhancing Tamil Nadu’s dairy sector significantly contributes
the efficiency, transparency, and trust within this system. to the local economy and provides livelihood for
The findings of this research will provide insights into thousands of farmers. Strengthening the dairy
areas that require structural and policy reforms to ensure supply chain ensures stable incomes for farmers
sustainable growth and fair practices in the dairy sector. and stimulates rural development. This study seeks
1. By analyzing the current challenges faced in the to explore how collaborative efforts and transparent
supply chain and trade relations, the study can practices can foster economic resilience and social
offer recommendations to boost the business cohesion in dairy farming communities.
performance of dairy cooperatives. Enhancing
6. The entry of private players into the dairy market
efficiency in operations such as procurement,
has brought about a new wave of competition,
processing, and distribution can lead to cost
necessitating a more sophisticated approach to
savings and increased productivity. This is vital for
cooperative management. This research can help
maintaining competitiveness in a sector that is now
identify adaptive strategies that enable cooperatives
seeing participation from private dairy players,
like Aavin to leverage modern technologies, adopt
driving the need for strategic improvements in
more efficient production methods, and stay
cooperative operations.
relevant in an evolving marketplace.
2. Trust and loyalty are pivotal in sustaining long-
term partnerships between dairy farmers and SCOPE OF THE STUDY
cooperatives. This study aims to identify the gaps in The study goals to recognize the customer’s awareness of
the current recognition procedures and interactions Aavin products in Chennai city. This study is made with
that may lead to issues of mistrust or conflict. By the limit of 200 customers in Chennai. The study gives
providing empirical data on the perceptions of further scope for further improvement on parameters for

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 Consumer Buying Behavior and Perception of FMCG Aavin.......... Rajalakshmi and Anthony

the whole of Tamil Nadu state. It also helps the industry these insights, the Tamil Nadu Cooperative Milk
to know the level of satisfaction based on the customers Producers’ Federation Limited (Aavin) can enhance
taste, quality and other important factor. product quality, broaden its brand offerings, and better
meet consumer expectations.
REVIEW OF LITERATURE
[3]Aries Susanty et al. (2017), in their study titled, “The
METHODOLOGY OF THE STUDY
Characteristic the study findings are analyzed to
Empirical Model of the Dairy Milk Supply Chain’s
using the research approach. Data and other relevant
Commercial Success, Loyalty, and Trust”, examined the
information are gathered using the survey approach,
challenges in Chennai’s dairy sector, noting the critical
which uses a structured questionnaire. Practicality
issue of unregulated practices between dairy cooperatives
For numerical convenience, 200 samples—that is,
and farmers. Without a formalized agreement, both
customers of Chennai-based Aavin Dairy products—
parties often prioritize their interests, which can
are employed in the sampling process.
destabilize operations. The authors recommended that
cooperative CEOs implement transparent strategies ANALYSIS AND INTERPRETATION
focused on accountability, particularly for pricing
Table 1: Regular Usage
and marketing, and adopt an inclusive approach that
considers farmers’ perspectives. This, they suggested, Regularity of Customers Response Percentage
would promote long-term industry sustainability and Yes 116 58%
profitability by expanding market reach. No 84 44%
[6]Karthikeyan, R. (2019), in Consumer Satisfaction Total 200 100%
with Aavin Milk Products, found that consumers favor
Source: Primary Data
Aavin products due to their affordability, quality,
appropriate packaging, and precise product weight. The The data presented in Table 1 indicates the regularity
study emphasized the importance of providing training of customer usage for Aavin products. Out of a total
and education for milk producers and sellers to further of 200 respondents, 116 individuals (58%) reported
enhance product standards and customer satisfaction. that they regularly use Aavin products, while 84
respondents (42%) indicated that they do not use
[7]Arun and Dhanya (2020) highlighted that Aavin
these products regularly. This implies that a majority
is well-regarded by consumers and has significant
of the surveyed participants have a consistent habit of
potential to increase its market share, particularly in rural
using Aavin products, reflecting a significant level of
areas. In today’s competitive landscape, consumers are
customer retention and loyalty. However, the fact that
drawn to products that offer good taste and innovative
42% of respondents do not regularly use the products
packaging. To strengthen its market position, Aavin
suggests room for growth in market penetration and
could consider reducing prices and offering smaller
opportunities for the company to engage in targeted
package sizes, such as 100ml and 200ml, to attract
marketing efforts to convert occasional or non-users
lower-income consumers. Additionally, strategic sales
into regular customers.
promotions could support greater market penetration.
Table 2: Opinion about price of Aavin products
[8]Manida and Nedumaran (2020) emphasized the
promising role of milk and dairy products in the food Price – Dairy Products Response Percentage
processing sector, particularly through traditional dairy Very high 16 8%
items and milk-based desserts. The authors noted that High 82 41%
product quality and safety are essential for brand success, Reasonable 96 48%
which can be effectively communicated through strong
Low 6 3%
advertising. They pointed out that consumer spending
Total 200 100%
on milk and dairy products is growing in both urban and
rural areas, a trend expected to continue. Implementing (Source: Primary Data)

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Consumer Buying Behavior and Perception of FMCG Aavin.......... Rajalakshmi and Anthony

Table 2 presents the respondents’ opinions regarding the Table 4 reveals that a large majority of respondents, 76%,
pricing of Aavin dairy products. Among the 200 surveyed are aware of Aavin’s customized products, indicating
participants, 96 individuals (48%) believe that the prices that the company has been successful in promoting and
of Aavin products are reasonable. This represents the informing its customers about its specialized offerings.
majority view, indicating that nearly half of the consumers In contrast, 24% of respondents are unaware of these
perceive the pricing as fair and acceptable. On the other
customized products, which suggests that there is still
hand, 82 respondents (41%) feel that the prices are high,
suggesting that a significant portion of the customer base an opportunity for Aavin to enhance awareness among
finds the products somewhat costly. A smaller segment, 16 this segment. Overall, the high level of awareness
respondents (8%), view the prices as very high, pointing reflects positively on Aavin’s marketing efforts, but the
to potential pricing concerns that may affect affordability company could further increase customer engagement
and accessibility. Only 6 respondents (3%) consider the by addressing the needs of the remaining quarter
prices to be low, indicating that minimal perception exists of respondents who are not yet familiar with the
of Aavin products being budget-friendly. customized products.
Table 3: Rating on quality of Aavin products Quality Table 5: Satisfaction towards various factors related to
Aavin products.
Rating on Quality Response Percentage
4 24 12% Rating Variety Marketing Availability
Efforts
3 120 60%
Highly 24 (12%) 32(16%) 36(18%)
2 56 28%
satisfied
1 0 00/0
Satisfied 120 (60%) 100(50%) 120(60%)
TOTAL 200 100%
Neutral 48 (24%) 48(24%) 36(18%)
(Source: Primary Data) Dissatisfied 8 (4%) 20(10%) 8(4%)
Table 3 provides insights into customer ratings regarding Highly 0 (0%) 0 (0%) 0 (0%)
the quality of Aavin products. A significant majority, 60% dissatisfied
of respondents, rated the quality as 3 (good), indicating TOTAL 200(100%) 200(100%) 200(100%)
a generally favorable perception of Aavin’s product
(Source: Primary Data)
quality. 12% rated it a 4 (excellent), reflecting a smaller
but still notable group who view the products as superior. Table 5 indicates that a majority of respondents are
Conversely, 28% gave a rating of 2 (fair), suggesting satisfied with Aavin products across various factors.
that a considerable portion of customers feel the quality Specifically, 60% are satisfied with the variety of
could be improved. Interestingly, no respondents rated the products, 50% with marketing efforts, and 60% with
products a 1 (poor), which indicates that even the more availability. While a smaller percentage, around 12%
critical consumers do not perceive the quality as poor. to 16%, are highly satisfied with these factors, there
Overall, while the majority are satisfied with the quality,
is still a segment (4%-10%) who are dissatisfied or
there is room for improvement, especially in appealing to
the 28% who consider the quality only fair. Enhancing the neutral. This suggests that Aavin’s overall performance
product quality further could potentially increase overall is positive, but there remains room for improvement in
customer satisfaction and loyalty. enhancing satisfaction, particularly in marketing efforts
and product variety.
Table 4: Awareness towards customized Aavin
products Table 6: Customer’s recommendation to others for
purchasing Aavin products
Awareness on customized Response Percentage
Products. Recommendation Response Percentage
Yes 152 76% Yes 170 85%
No 48 24% No 30 15%
TOTAL 200 100% Total 200 100%
(Source: Primary Data) (Source: Primary Data)

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 Consumer Buying Behavior and Perception of FMCG Aavin.......... Rajalakshmi and Anthony

Table 6 reveals that a significant majority of respondents, customer expectations as a market leader, with 48%
85%, would recommend Aavin products to others, of respondents rating its product prices as reasonable,
indicating a high level of customer satisfaction and while 41% feel the prices are high. To attract and retain
trust in the brand. Only 15% of respondents would not more customers, Aavin may consider reducing its prices,
recommend the products, suggesting that while the especially since a significant portion of consumers
overall sentiment is positive, there is still a small group perceive them as excessive. As competition increases,
of consumers who may have reservations. This strong Aavin could also refine its marketing strategies to attract
recommendation rate highlights Aavin’s potential for new customers and keep existing ones informed about
customer loyalty and positive word-of-mouth, which new product offerings.
can be valuable for expanding its market presence.
REFERENCES
Table 7: Factors influenced to choose Aavin
1. Zhong, Z., Chen, S., & Kong, X. (2013). Production
Factors Response Percentage pattern, transaction style, and raw milk quality. China
Agricultural Economic Review, 5(4), 526–542. https://
Price 8 4%
doi.org/10.1108/CAER-07-2011-0081]
Quality 116 58%
2. Rangasamy, N., & Dhaka, J.P. (2008). Marketing
Taste 44 22%
efficiency of dairy products for cooperative and private
Availability 28 14% dairy plants in Tamil Nadu—A comparative analysis.
Packaging 4 2% Agricultural Economics Research Review, 21, 235–
Other factors 0 0% 242.
TOTAL 200(100%) 200(100%) 3. usanty.A.,Muliyali.,S.,&Lestari,m.(2017) The
empirical model of the dairy milk supply chains
(Source: Primary Data)
commercial success,loyalty,&trust. Journal of supply
Table 7 shows that the most significant factor influencing chain management, 52(4), 525-538.
customers’ choice of Aavin products is quality, with 4. hila, D., & Boopathib, C. (2015). Consumer behavior
58% of respondents selecting it as the primary reason. on Aavin milk and dairy products in Pollachi Taluk
Taste follows with 22%, indicating that flavor is also of Tamil Nadu. International Journal of Commerce,
an important consideration for a substantial portion Business and Management (IJCBM), 4(6).
of consumers. Availability is a factor for 14% of 5. Elangovan, N., & Gomatheeswaran, M. (2015). A study
respondents, while price, packaging, and other factors on consumer behavior towards various brands of milk
have minimal influence, with only 4%, 2%, and 0% of and milk products with special reference to Thudiyalur
respondents citing them, respectively. This suggests town at Coimbatore district in Tamil Nadu. Research
that Aavin’s strong brand reputation for quality plays Journal of Social Science & Management, 2(4), 595–
a dominant role in attracting customers, while taste and 601.
availability are secondary but still relevant factors. 6. Karthikeyan, R. (2019). Consumer satisfaction with
CONCLUSION Aavin Milk products. International journal business
and management research 14(6), 302-304.
Consumer perception is a crucial factor for a company
[7] Arun,M.,& Dhanya.,P (2020) A market analysis of Aavin’s
to maintain profitability, as it influences both customer brand potential . Jouirnal of Agriculture &business
acquisition and retention. The study reveals that 28(4), 271-385.
when purchasing dairy products, customers primarily
consider factors such as quality, taste, texture, freshness, [8] Manida, R., & Nedumaran.,K.(2020). Role of dairy
products in the food processing sector. Food science
and convenience. However, the key challenge lies
journal,56(7),489-502.
in making milk affordable while maintaining these
essential qualities. According to the survey, Aavin meets

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