Thesis Marketing Strategies of Cadbury India Limited
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Transcript of Thesis Marketing Strategies of Cadbury India Limited
PROJECT REPORT
On
“ANALYSIS OF CADBURY CHOCOLATE IN THE
MARKET WITH ITS COMPETITORS”
AT
SUBMITTED FOR THE AWARD OF MASTER OF BUSINESS ADMINISTRATION
TABLE OF CONTENTS
INTRODUCTION
EXECUTIVE SUMMARY
OBJECTIVE OF RESEARCH
RESEARCH METHODOLOGY
ANALYSIS & OBSERVATION
DATA ANALYSIS AND FINDINGS
CONCLUSION
RECOMMENDATIONS
BIBLIOGRAPHY
QUESTIONNAIRE
Declaration by the Candidate
I hereby declare that the research project report titled “ANALYSIS OF
CADBURY CHOCOLATE IN THE MARKET WITH ITS COMPETITORS”
Is the outcome of my own work and same has not been submitted to any
university/ institutions for the award of any degree or any professional
diploma.
Date: ( )
Sign of candidate
ACKNOWLEDGEMENT
The successful completion of any work would be always be
incomplete unless we mention the valuable cooperation and
assistance of those people who were a source of constant guidance
and encouragement , they served as bacon light and crowned our
efforts with success.
I would like to extend my sincere gratitude to our Prof. Avnish Tyagi
for his guidance.
Preface
The Cadbury’s India’s number one chocolate is able to share with
their market insights based upon unparallel breath of chocolate
experience.
The merge in 1969 with Schweppes and the subsequent
development of the business have led to Cadbury Schweppes taking
the led in both, the confectionery and soft drink market Intec UK
and becoming a major force in the international market. Cadbury
Schweppes today manufactures product in 60 countries and a trade
in staggering 120.
This project is a sincere effort to look for the market potential in
chocolate and confectionery industry. A descriptive research
procedure had been applied to come to the conclusions of the
project. A detailed questionnaire had been prepared and the
responses of the concerned people had been collected for the
analysis. The project later concluded in recommending the market
potential of the chocolate and confectioneries.
EXECUTIVE SUMMARY
TITLE: ANALYSIS OF CADBURY CHOCOLATE IN THE MARKET WITH ITS COMPETITORS.
Rationale of study:
The Cadbury’s Inc has taken the opportunity to offer us a broader
view of chocolate category. The Cadbury’s India’s no.1 Chocolate is
able to share with their market insights based upon unparalleled
breath of chocolate experience.Cadbury has grown from strength to
strength with new technologies being introduced to make the
Cadbury confectionary business, one of the most efficient in the
world.This report study about market share and different strategy
with its competitors.
Objective:
To analyze the marketing strategies of the company with
To determine the market share of Cadbury .
To demonstrate the marketing strategies of Cadbury India
Ltd.
Importance:
1) This report is useful for the researchers who are willing to do
research on the Cadbury chocolate and its present
competitors in the market.
2) This report shows the problems associated with the Cadbury
industry in the market as it helps in removing these problems.
3) This report can be useful as a secondary data for chocolate
industry.
4) This report helps in knowing the current and future scenario
of confectionary industry.
5) This report helps in knowing market position of different
confectionary industry.
Research Methodology:
The research conducted by Exploratory Research this type of
research is Qualitative and Quantitative. Qualitative refers to the
characters of the data or process by which the data are gathered.
The research process consists of a series of closely related
activities. Why a research study has been undertaken. Why a
research study has been undertaken, how the research problem has
been defined, in what way and why the hypothesis has been
formulated, what data has been collected and what particular
method has been adopted and a host of similar other question are
usually answered when we talk of research methodology concerning
a research problem or study.
Sampling:
The data was to be collected only from the Consumers and
Retailers. A questionnaire was prepared and interviewing with
Retailers and Consumers.
A decision has to be taken concerning a sample unit before
selecting the number of samples. It may be geographical as well as
individual..
Size of Sample:
This refers the number of items (Outlets) to be selected from the
finite universe to constitute a sample size. The survey was
conducted of 50 outlets.
Analysis:The data was tabulated manually and was also analyzed manually
excel was used to make graphs and pie chart.
26% of people are interested in eating chocolate and 74%
are not eating.
The Cadbury brand chocolate 75% of people prefer after
that Nestle, Amul and others are take place.
Most of the people buy chocolate from superstore and
after that from retail or movie mall.
54% people are not aware from this brand while 46% are
aware.
Dairy milk and 5 star is most famous product of Cadbury.
Cadbury chocolate is very easily available in the market.
Conclusion:
This company project has demonstrated “CADBURY’S MARKETING
AND COMPETITIVE STRATEGIES” that has proved to be extensive
through, and of great benefit to the company in furthering its
competitive advantage.
In this project it possible to see the success of Cadbury’s in its
indorse its strong potential to continue to do well.
Recommendations :
Maintain dominance in chocolate, confectionery and market
leadership in blown drinks.
New channels such as gifting, child connectivity and value for
money offering to be the key growth drives.
Grow volume sales at least 20% p.a. over the next years.
Achieve the goal of best manufacturing location in Cadbury
Schweppes world for Dairy Milk and Éclairs.
One new major product launch every year.
INTRODUCTION
The Cadbury’s Inc has taken the opportunity to offer us a broader
view of chocolate category. The Cadbury’s India’s no.1 Chocolate is
able to share with their market insights based upon unparalleled
breath of chocolate experience.
Cadbury has grown from strength to strength with new technologies
being introduced to make the Cadbury confectionary business, one
of the most efficient in the world. The merge in 1969 with
Schweppes and the subsequent development of the business have
led to Cadbury Schweppes taking the led in both, the confectionary
and soft drink market Intec UK and becoming a major force in the
international market. Cadbury Schweppes today manufactures
product in 60 countries and a trade in staggering 120. The Cadbury
story is a fascinating story of a family business that grew in one of
the biggest, most loved chocolate brand in the world. A story that
you will remember as the story of “The taste of life”.
This project is a sincere effort to look for the market potential in
chocolate and confectionery industry. A descriptive research
procedure had been applied to come to the conclusions of the
project. A detailed questionnaire had been prepared and the
responses of the concerned people had been collected for the
analysis. The project later concluded in recommending the market
potential of the chocolate and confectioneries
The legend called Cadbury
1824 – A once business was opened in 1824 by a young Quaker,
John Cadbury, in Bull street Birmingham was to be the foundation of
Cadbury Limited, now one of the world’s largest producer of
chocolate.
1831 – By this year the business had changed from a grocery shop
and John Cadbury had become a manufacturer of drinking chocolate
and cocoa. This was the start of Cadbury manufacturing business as
it is known today. A larger factory in Bridge Street Birmingham was
rented in 1847, John Cadbury was joined by his brother Birmingham
and the business became Cadbury Brother of Birmingham.
1861 – John Cadbury resigned his business and handed over to his
sons, Richard, 25 and George, 21 who after 5 difficult years almost
shut down the business to take up other vocation. Fortunately for
generation of chocolate lovers, they didn’t.
1866 – Saw a turning point for the company with the introduction of
a process for pressing the cocoa butter from the coca beans. This
not only enabled Cadbury Brothers to produce pure coca essence,
but the plentiful supply of coca butter remaining was also used to
make new kind of eating chocolate. The essence was advertised as
‘Absolutely pure, therefore best’.
1879 – Business prospered from this time and Cadbury Brother
outgrew the Bridge Street factory, moving in 1879 to a ‘Greenfield’
site some miles from the center of Birmingham which came to call
Bourneville. The opening of the Cadbury factory in a garden also
heralded a new era in industrial relations and employee welfare
with
joint consultation being just one of the introduced by the pioneering
Cadbury Brothers.
1899 – In this year the business private limited company – Cadbury
Brothers Limited. Progress since the start of the century through the
inter – war years onward ahs been rapid. Chocolate has moved
being a “luxury” item to well within the financial reach of everyone.
1905 – Cadbury has many famous brands with one of major success
story being Cadbury’s Dairy Milk chocolate launched in 1905, today
Britain’s favorite moduled chocolate bar.
Cadbury today is the market leader in the U.K chocolate
confectionary market, employing the most advanced processing
technology and management information and control techniques.
The company is the confectionary division of Cadbury Schweppes
plc which is major force in the confectionary and soft drinks
international market.
World - wide Cadbury is one of the pre – eminent names in
confectionary with impressive range of famous brands.
Quality has been the focus of the Cadbury business from the very
beginning as generations have worked to produce chocolate with
that very special taste, smoothness and snap, so characteristics of
Cadbury’s chocolate.
Design Development
Milk chocolate for eating was first made by Cadbury in 1897 by
adding milk powder paste to the dark chocolate recipe of cocoa
mass, cocoa butter and sugar. By today’s standards this chocolate
was not particularly good as it was very coarse and dry and was not
sweet or milky enough for public tastes.
At that time there was a great deal of competition in the U.K from
continental manufactures, not only the French with their fancy
chocolates but also from the Swiss, who were renowned for their
milk chocolate. Led by George Cadbury junior, the Bourneville
experts set out to meet the challenge. A considerable amount of
time and money was spent on research and new plant design to
produce the new chocolate in much large quantities.
A new recipe was formulated fresh milk and new production
processes were developed to produce milk – chocolate not as
merely as good as but better than the imported milk chocolate.
Four years of hard work were invested in the project and in 1905
what was to be Cadbury’s top selling brand was launched. Three
names were considered Jersey Highland Milk and Dairy Maid. Dairy
Maid became Dairy Milk and Cadbury’s Dairy Milk with its unique
flavor and smooth creamy texture was ready to challenge the Swiss
domination of the milk chocolate market.
By 1913 it had become the company’s best selling line and in the
mid twenties Cadbury’s Dairy Milk gained its status as the brand
leader, a position that it has held ever since. Today more than 250
million bars of Cadbury’s Dairy Milk are made every year and sales
reach over 100 million Pound in value.
While advertising and label design g-have changed with fashion and
considerable strides have been made in manufacturing
technologies, the recipe for Cadbury’s Dairy Milk its ‘glass and a half
of full cream milk in every half pound produced’ is still basically the
same as when it was launched.
Cadbury’s Dairy Milk Story
Chocolate has been enjoyed by successive generation since the
manufacturing process was developed in the Victorian Times. Good
chocolatiers is an art form depending on recipe traditions, which
have grown over the years. Chocolatiers have use their skills to
make balanced recipe in which all the ingredients combine to
produced chocolate with all the characteristics that enable full
delicious taste to be enjoyed by the consumers.
By today’s standards the first chocolate for eating would have been
considered quite unpalatable. It was the introduction of the Van
Houten cocoa press from Holland that was the major break through
in the chocolate production as it provided extra cocoa butter
needed to make a smooth glossy chocolate.
Cadbury’s Milk Tray – 1915
Milk Tray has maintained its popularity in the changing world since
the milk chocolate assortment made with the famous Cadbury’s
Dairy Milk chocolate was first introduced in 1915.
The name ‘tray’ derived from the way in which the original
assortment was delivered to the shops. Originally Milk Tray was
packed in five and as half pound boxes, arranged on trays from
which it was sold loose o customers. The half pound deep – lidded
box with the traditional purple background and gold script was
introduced in 1916, followed by one pound box in 1924.
With its stylish, without frills presentation Milk Tray was the
assortment for everyday, not just special occasion and it
represented the best buy in the chocolate for millions of people. The
pack design has been regularly updated and the assortment itself
has changed in line with consumers taste and preferences.
By the end mid – thirties the Cadbury’s Milk Tray assortment
outsold all its competitions and today it is still one of the most
popular boxes of chocolates in this country.
PRODUCT PROFILE
CHOCOLATE & CONFECTIONARY
Dairy Milk
Fruit & Nut
Picnic
Perk
Gems
Éclairs
Nutties
Temptation
Cadbury’s Fruit & Nut
New Launch
Cadbury target kids with Milk Treat: - It is a product that talks
directly to the target consumer. The product benefits have been
defined as “The goodness of milk to
the fun of chocolate”. it combines
both good health, multinational
value of milk along with the values
of fun and excitement. The kinds
formally associate with Cadbury
chocolate offering.
Temptation :- It is aimed at the niche “international chocolate “
segment of the chocolate market a segment how upgrade from
brands such as Cadbury’s to premium
international offering such as
Tolerance, Lindit and Hersheys.
Roughly 5%of the total domestic
consumption expected to grow to
some 10%. This segment is too good
to miss out on. The
Previous
Cadbury’s range available in India did
not offer consumer an option to
upgrade to international chocolate
within the Cadbury’s fold. Temptation
is an attempt to lug niche, priced Rs.
30.
The Cadbury StoryCadbury’s success story
In 1984, John Cadbury founded U.K. company with one aim:- to
create the highest quality chocolate. By1969, when Cadbury
merged with the soft drink giant. Schweppes, Cadbury brands were
already famous all around world.
Today Cadbury’s production are enjoyed in 120 countries, with 40
chocolate confectionary brands, Cadbury dominated markets as far
as the U.K. and Australia that’s why Cadbury have been dubbed
“The world’s master chocolate makers”.
The secret of Cadbury’s success
What is the secret of Cadbury’s continuing success
first there’s the careful selection of the finest coca
beans from west Africa, as well as tasty hazel nuts
from Turkey and the fine sheet and choicest natural
ingredient available to us anywhere.Finally there’s
skillful marketing Cadbury always takes extreme
care in selecting and marketing the right range of
product in every cause.
The right product, the right partners, the right marketing, the
promotional back up and the right employees. These are the
ingredients in Cadbury’s latest recipes for success.
Right from the stand Cadbury Dairy Milk Chocolate success has
been based on 4 factors:-
Quality
Value for money
Advertising
Amul Chocolates
AMUL CHOCOLATE is made from Sugar, Cocoa Butter, Milk Solids, Chocolate mass
Composition:
Milk Fat 2% Sugar 55% Total Fat 32.33% (Milk Fat + Cocoa Fat) Cocoa Solids 7.5% Milk Solids 20%
Product Specification:
Meets all requirements under the PFA for boiled sugar confectionary.
Gujarat Cooperative Milk Marketing Federation
GCMMF: An Overview
Gujarat Cooperative Milk Marketing Federation (GCMMF) is India's
largest food products marketing organisation. It is a state level apex
body of milk cooperatives in Gujarat which aims to provide
remunerative returns to the farmers and also serve the interest of
consumers by providing quality products which are good value for
money.
Members: 12 district cooperative milk producers' Union
No. of Producer Members:
2.36 million
No. of Village Societies: 11,333
Total Milk handling capacity:
6.9 million litres per day
Milk collection (Total - 2003-04):
1.81 billion litres
Milk collection (Daily Average 2003-04):
4.97 million litres
Milk Drying Capacity: 511 metric Tons per day
Cattlefeed manufacturing Capacity:
2340 Mts per day
Amul Brands
Quality is the essential ingredient in all of our brands and the reason why millions of people choose Nestlé products every day.
Sales Turnover Rs (million) US $ (in million)
1994-95 11140 355
1995-96 13790 400
1996-97 15540 450
1997-98 18840 455
1998-99 22192 493
1999-00 22185 493
2000-01 22588 500
2001-02 23365 500
2002-03 27457 575
2003-04 28941 616
Our consumers have come to trust in Nestlé’s commitment to excellence and turn to Nestlé brands to maintain nutritional balance in a fast paced world.
Baby Foods:
Nutrition that suits the needs of your baby.
Dairy Products:
From shelf-stable solutions to chilled dairy.
Breakfast Cereals:
Start your day out healthy with Nestlé BreakfastCereals.
Ice Cream:
Discover the world of delicious Nestlé Ice Cream.
Chocolate & Confectionery
Delighting the senses with a range of tastes and textures.
Prepared Foods:
Preparing well-balanced meals is a snap with Nestlé.
Beverages:
Drink to a healthy, active life with Nestlé beverages.
Food Services :
Providing food and beverage professionals with a wide range of solutions.
Bottled Water:
Capturing nature in its purest form.
Petcare :
Nutrition, health and wellness for your pet.
NESTLE INDIA
THE NESTLE India stock has been bubbling with activity in an
otherwise listless equity market.
Till date, the stock has surged 77 per cent from its low of Rs 304 in
May 2000 and now commands a valuation 39 times the expected
earnings for 2000. This is steep by FMCG standards.
The recent surge in the stock is partly driven by the announcement
by the parent, Nestle SA, that it would use the creeping acquisition
route to mop up another five per cent in Nestle India through open-
market purchases. But improving the stock's valuation can also be
traced to good financial performance in a market starved of healthy
earnings numbers.
On a comeback trail
The resumption of its coffee exports to Russia and a favourable
input price environment pepped up Nestle India's net profit growth
to 28 per cent in the first nine months of 2000. Sales growth in this
period was 10.4 per cent, with domestic sales rising 9.8 per cent
and export sales 13.8 per cent. In reality, the growth in sustainable
net profits was higher than reported as the company took an
additional one-time charge of Rs 14.70 crore in the first nine months
of 2000 for provisions against contingencies.
Unusually, low input prices may have contributed considerably to
margin expansion. Continuing surpluses in global production have
pushed both coffee and cocoa prices (the two key inputs for Nestle
India, apart from milk) to historic lows in 2000. While coffee prices
are hovering close to their seven-year lows, cocoa prices recently
bounced off their lowest levels in three decades.
With global agencies forecasting high carry-in stocks for the next
season, the soft input price advantage could be with Nestle for the
time being. Does this mean Nestle India will sustain its healthy
earnings performance over the next couple of years? This will
depend on its ability to revive sales growth in its domestic product
categories.
Greener pastures at home
Nestle's 10.4 per cent sales growth in the first nine months of 2000
is partly magnified by the low base of comparison. The cessation of
coffee exports to Russia due to the economic crisis there, led to a
38 per cent drop in export sales (and a 5 per cent drop in net sales)
for Nestle India in 1999.
Instant coffee exports to Russia resumed this year, but the business
remains poor because realisations have fallen in line with green
coffee prices. Since realisations in the export market are unlikely to
look up in the next year, Nestle will continue to look to its domestic
product portfolio to sustain earnings growth.
In recent times, as with other FMCG companies, Nestle India's
topline growth in the domestic market was unimpressive, at around
8 per cent in 1999 and 9.8 per cent in the first nine months of 2000.
In the domestic market, Nestle India has traditionally derived its
revenues from five product baskets -- coffee (Nescafe Select,
Sunrise); milk products (Milkmaid condensed milk and ready mixes,
Coffeemate coffee creamer, Everyday Dairy Whitener); weaning
foods for infants (Cerelac, Nestum, Lactogen);
chocolates/confectionery and malted beverages (Milo, KitKat,
Charge, Munch, Polo); and food products (Maggi noodles, soups).
Cash cows slow down
Of these, weaning foods and milk products are the cash cows, with
dominant market shares in both businesses. But as these are
mature products, they appear likely to deliver steady, and not
scorching, growth rates. Sales growth in these businesses was less
than five per cent in 1999-2000.
In chocolates and instant coffee, the growth prospects appear
brighter, but Nestle faces intense competition from the players with
the dominant market shares. While Unilever and Tata Coffee are
significant threats in the coffee market, the market leader Cadbury
India has been a potent threat in the chocolate confectionery
market.
Nestle's Kitkat has actually ceded market share to Cadbury's Perk in
the past year. The market for specialised food products such as
soups and noodles holds healthy growth potential. But the market is
relatively small and players such as International Bestfoods,
Unilever and Dabur are vying with a host of imported brands and
regional players for a share of the pie.
Stretching existing businesses
Over the past year, Nestle has devoted considerable attention to
the expansion of its domestic businesses. It has drawn brands such
as Coffeemate coffee creamer, Frappe cold coffee and Nescafe Gold
from the Swiss parent's portfolio to expand its milk products and
beverages range. Incidentally, the inputs from the parent do not
come free. Nestle India paid its parent a Rs 53.69-crore royalty in
1999 (net profits for the year were Rs 98.47 crore). Royalty
payments accounted for 3.5-4 per cent of sales over the past three
years.
Nestle has used the soft input prices to reduce prices of its coffee
and chocolate brands. Products such as KitKat and Munch in low-
unit price packs have been used to encourage trial and bolster
flagging volumes. But these moves will take time to pay off.
However, the revival in the 2000 third quarter domestic sales is
heartening. For the quarter ended September 2000, Nestle reported
an 18 per cent growth in domestic sales (export sales declined 8 per
cent due to lower realisations). Considering that Nestle has reduced
both coffee and chocolate prices over the past year and held other
product prices, this indicates volume growth of a higher order.
A plan to expand the network of Nescafe vending machines and
establish coffee bars to encourage out-of-home consumption of
coffee is also on the cards.
Testing the waters
Over the past year, the company has also announced forays into
three new areas -- liquid milk, bottled water and biscuits. The foray
into biscuits is through the joint venture Excelsia Foods, so the
contribution to Nestle's revenues may at best be in the form of
dividends for now.
Liquid milk and bottled water are businesses that hold immense
growth potential. Larger players can expand through higher
penetration levels and at the expense of the unorganised segment.
However, both these segments are quite crowded with feature
listed and unlisted players which have considerable financial
muscle.
In the liquid milk segment, Nestle will be up against the formidable
Amul, apart from a host of private dairies with established clientele.
In the bottled water market, the market leader, Bisleri (of Parle
Products), has had to contend with competition from scores of me-
too brands, apart from Pepsi's Aquafina, Coca-Cola's Kinley. Going
forward, competition is only likely to increase, with Britannia
planning to launch more bottled water brands from its foreign
collaborator Danone's portfolio (Evian, one of the largest bottled
water brands, is already on shop shelves).
Striving for niches
Nestle India has already launched two bottled water brands in the
domestic market -- the internationally renowned Perrier, followed
recently by its sparkling mineral water brand, San Pellegrino
(reputed to be sourced from the Swiss Alps).
However, both products are for upmarket consumers. The premium
pricing suggests that the products will remain niche products with
relatively small target markets. Pure Life, the mass market bottled
water brand to be launched shortly, will determine the success or
failure of Nestle's bottled water foray.
Nestle India has also shied away from the mass market for liquid
milk in plastic pouches, and instead restricted itself to ultra heat
treated (UHT) milk in Tetrapacks. The product is priced at a
substantial premium to the other local brands.
Investment outlook: Nestle's new product forays are into extremely
competitive markets and investments in the new businesses are
likely to be high over the next few years.
In this respect, the advantage of soft input prices, high cash flows
available from the stable businesses (such as weaning cereals and
coffee) and the financial might of the parent, Nestle SA, will stand
Nestle India in good stead.
The royalty to the parent should ensure that Nestle India continues
to enjoy ungrudging access to the parent's product portfolio. In
many respects, in India Nestle is pitted against its key adversaries
worldwide -- Groupe Danone and Unilever. In the foods business at
the global level, both companies are considerably smaller than
Nestle SA.
But marketing prowess, rather than size is likely to determine the
success of Nestle India's new product forays in the next couple of
years. Since the high growth rates of this are partly on account of
the low base of last year, the growth rates are likely to reach more
moderate levels next year. The stock continues to be a good
investment option for investors with a three-year horizon. But since
the recent uptrend is partly on account of factors unrelated to the
fundamentals, there could be some downside to the stock in the
near-term.
OBJECTIVE OF THE PROJECT
My main objective of the study on this project is to demonstrate the
marketing strategies of Cadbury India Ltd. To analyze the marketing
strategies of the company with its competitor in the market.
Following are the some of the main objective of my report are as
under:
Comparative study of Cadbury chocolate in the market with
its main competitors.
To analyze the marketing strategy of the Cadbury India Ltd.
To study about the customer taste and preference in the
confectionary item.
To find out the market share of the different competitors in
the chocolate industry.
And also to find out the satisfaction level of customer about
their product.
.
IMPORTANCE OF THE STUDY
This report gives the help to the marketers for analyzing the
different competitors in the chocolate industry. These are the
following some importance of this research report as under:
6) This report is useful for the researchers who are willing to do
research on the Cadbury chocolate and its present
competitors in the market.
7) This report shows the problems associated with the Cadbury
industry in the market as it helps in removing these problems.
8) This report can be useful as a secondary data for chocolate
industry.
9) This report helps in knowing the current and future scenario
of confectionary industry.
10) This report helps in knowing market position of different
confectionary industry..
RESEARCH METHODOLOGY
Achieving accuracy in any research requires in depth study
regarding the subject. As the prime objective of the project is to
compare Cadbury with the existing competitors in the market and
the impact of Nestle on Cadbury, the research methodology
adopted is basically based on primary data via which the most
recent and accurate piece of first hand information could be
collected. Secondary data has been used to support primary data
wherever needed.
Primary data was collected using the following techniques
Questionnaire Method
Direct Interview Method and
Observation Method
The main tool used was, the questionnaire method. Further direct
interview method, where a face to face formal interview was taken.
Lastly observation method has been continuous with the
questionnaire method, as one continuously observes the
surrounding environment he works in.
Procedure of research methodology
# Target geographic area was Delhi. NCR.
# To this geographical area questionnaire was given, the
questionnaire was a combination of both open ended and closed
ended questions.
# The date during which questionnaires were filled was between six
week.
# Some dealers were also interviewed to know their prospective.
Interviews with the honour of retailer of Cadbury were also
conducted.
# Finally the collected data and information was analysed and
compiled to arrive at the conclusion and recommendations given.
Sources of secondary data
Used to obtain information on, Cadbury and its competitor history,
current issues, policies, procedures etc, wherever required.
# Internet
# Magazines
# Newspaper
ORGANIZATIONAL STRUCTURE
MANAGING DIRECTOR
GENERAL MANAGER
VICE PRESIDENT
MARKETING
MANUFACTURING
SALES FINANCE DISTRIBUTION
Cadbury Schweppes
Cadbury Schweppes plc, a global beverage and confectionary giant
with annual sale of Rs 20,000 crores,is the worlds number one non –
cola soft drink company having bottling and partnership operations
in 14 countries and franchises of its brand in a further 86 countries
around the world. Its Hundred Percent subsidiary in India named
Cadbury Schweppes Beverage India (private) Limited (CSBIL)
started operation in March 1995. The first brand was launched was
crush which was later followed by Canada Dry, Schweppes Tonic
Water, Schweppes Bitter Lemon.
CSBIL with its franchise agreement with 19 bottles throughout India
proposes to be a household name. It has a policy for FOBOs
(Franchise owned bottling operations unlike Coke and Pepsi which
prefer COBO,s (Company owned bottling operations). In FOBO the
beverages company only supplies the concentrate and the
marketing support to build brand equity. The other aspects like
machinery, bottling line, land and distribution is the responsibility of
the bottler. As its CEO Mr. Ashok Jain says, “we are the software,
they are the hardware”.
Cadbury’s Market Segment
Market place for any product is comprised of many different
segments of consumers, each with different needs and wants.
Markets segmentation can be defined in a number of ways such as:
Demographic variables (e.g. Consumers are groups, gender,
material states income etc…)
The lifestyle of consumers (i.e. their interests and activities)
the benefits which consumers look for in a product or on the
occasions when the product might be consumed.
Cadbury takes into account all these factors when producing a
range of products. It targets different segments within the
market, such as the.
Break segment – products which are normally consume as a
snatched break and often with tea and coffee, for example
Cadbury’s Perk and snack range.
Impulse segment – these products are often purchase on
impulse, eating these and then. They include product such as
Cadbury’s Dairy Milk.
Take home segment – this describes product that are
normally purchased in supermarkets, taken home consumed
at a later stage.
The Real Taste of Rejuvenation
It was the market – leader, but sales inched along. It focused firmly
on its target segment, but the real buyer lay beyond. For seven long
years, Cadbury’s Dairy Milk chocolate suffered stagnancy even as
other consumer products boomed. Just how did the company
rejuvenate an old brand to create the marketing megs-hit of the
199s?
It Stand First Among Second coming. And it wasn’t so much a
re-launch as it was a process of rejuvenation. Over a period of 12
months, starting February, 1994, the Rs. 314 crore confectionery
makers Cadbury embarked on the most outrageous repositioning
exercise in the recent history of Indian marketing. For, it
systematically dismantled the franchise that the company had built
over 30 years of its flagship brand, Cadbury’s Dairy Milk (CDM)-
Cadbury’s Milk chocolate until 1986-destroying the very
fundamental of generic association that had made million of Indians
refer to a bar of a chocolate as a “Cadbury”.
More proof of the chocolate is in the eating: two years into process,
CDM’s market share at 25%, with sale rising by an average 40% per
annum.
The Diagnosis
Today, The Real Taste of Life campaign, which served
Up chocolate in general, and COM in particular, into the
consciousness of adult, has already become a classic of advertising
and marketing. By 1993, Cadbury was desperately seeking growth
for the brand… “With a market share of 70%, trying to win away
customers from competitors in this stagnant market wouldn’t help.
They had to find new customers, people who’d never bought
chocolate before. Or, they had to increase consumption levels”. The
obvious solution, in a peculiar predicament. Despite low
penetration, both the brand and the category were displaying
symptoms of age: faltering growth, high recognition, and lack of
excitement. The market research revealed the cause of the graying:
chocolate wasn’t a snack in India. “In mature markets, chocolate
straddle a continuum, from boutique product – packaged raw
indulgence – to a casual food”. So, Cadbury whipped up a growth
solution that involved associating the brand with snacking and
functionally, which inevitably go together with high consumption
rates in the Western markets.
The next step: identify the barriers preventing consumers from
chocolate as a snack. A battery of test, both quantitative and
qualitative, comparing chocolate consumption to a basket of
competitive products revealed an unmistakable answer.
The Tests
Despite the Need To Clear The residual memory of CDM’s former
association, caution prevented a big break with the past, forcing
Cadbury to experiment with a combination of continuity and
change. The process entailed understanding the foundation of the
brand, since it was these that would support the new structure”.
Out went the caring - and - sharing element, but the family context
stayed. “Cadbury had two pillars, so it made sense to change one”.
Chocolate should be eaten whenever you feel like. It was an impulse
item, so why shouldn’t it be sold as one?”. The first of the two
commercial focused on functionality, purging the emotional
element.
Is the storyline, The father watches TV, engrossed, gnawing away at
a bar of CDM. The children enter, followed by the mother-but, by
that time, the father has completed the distinctly un paternal act of
devouring the entire bar. The children are shocked, where upon the
produces another bar for them-only to eat that up too. Finally, the
mother brings another bar out of her bag. The last shot more CDM
bars strew around casually.
The second commercial conveyed the same message, depicting
four member of a family doing their own thing on a Sunday
afternoon, each casually munching away on chocolates. The less
than – subtle message: eating chocolate’s just an everyday affair,
without special occasion or relationship coming into play. Despite
their strategic intent, both ads failed on pre – airing tests.
Why for stators, children were outraged at the idea of a parent
consuming chocolate, while adults were down right angry at the
notion of the father depriving his children of chocolate bar. Just as
important, consumer rejected the idea that chocolate-eating could
be equated with mechanical activities like combing one’s hair. After
all, chocolates were about feelings. There had to be magic,
romance, love and emotion. These elements had been ripped away
from the advertising. It was sans emotion”.
“Parent Are Different From Adults”
Even as the ad failed, however, they generated a valuable
byproduct, in the form of a new insight, into adult behavior. “Using
transactional analysis on response, Cadbury’s found that adult as
parents behave very differently from adults as adults. People forbid
their children from having chips, but gorge themselves. “The
implication”:-
“The moment the adult was shown in the context of his role as a
parent, all his cognitive preconception about the product would
come to the fore. He’d think about the reasons why, and the block
would automatically come up”. Tap child-ego state within the
adult, stimulating desire, spontaneity, and the craving for
instant gratification.
The Prescription
The crucial question that Cadbury was confronted with: what
strategy should it deploy to rejuvenate COM in a way that would
appeal to the child lurking within the adult? To inject a modern
flavor into COM, they chose to create a new brand identity,
borrowing a leaf from marketing guru David Aaker, who decrees
that brand identity should establish a relationship between the
brand and the customer by generating value proposition involving
functional, emotional, or self-expressive benefits.
“The Ads Had To Be Linkable”
“The consumer will always tell what his current belief system is, not
what it should be Cadbury’s job to mould has habits and behavior in
a way that would increase consumption for product and brand”.
“Impulse Drives Chocolate Sales”
One of the tools Cadbury’s used was Jean – Neal Kapferer’s Brand
Prism model to examine whether contemporary value systems
offered a peg on which the brand could be judge. The study
disclosed, interlaid, a distinct shift from collectivism to
individualism, with the pre – 1990’s sacrosanct values of filial and
family love being overshadowed by the manifestation of a larger
need for self – expression. “There was a definite yearning to be free
child”. Therein lay the opportunity for both unshackling
consumption and creating all-new association for CDM.
The Elixir
Having decided to barter the distinctly use selfish values of sharing
and caring for the suspiciously self-centered one of self-expression,
Cadbury’s people insisted that the rejuvenate be enriched with
compensation – and equally enduring – positive values: universal
truths, enduring human values, and universal moment of joy. To
translate the brief into the commercial, they decide to simply
portray occasion of childlike-but not childish-behavior from adults,
without explicitly identifying adults as the target customer.
“They left the connection to be made by the customer” “In the
process they were able to get viewer involvement and high levels of
empathy. Nowhere did they actually say, you’re an adult, you can
eat it. Because nobody wants to be told”. Thus it was that, the
montage of the child in the man-the old man kicking the football;
the pregnant woman carving a chocolate; young girl breaking into a
spirit; the young man tossing a bar of chocolate at his sweet-heart
departing in a bus-was created.
That the consumption had to be liked before it could penetrate the
cultural resistance to chocolate consumption by adults was obvious.
Taking a contrition stance, Cadbury decided to test the commercial
being devised by O&M’s creative team not for the tire battery of
likeability, comprehension, credibility and behavior modification –
but only for the first two. “If asked upfront, the consumer was
hardly likely to consider the dramatically-different idea credible. Nor
was there much chance of her announcing an immediate change in
behavior”. But why likeability and comprehension? Simple: the first
was meant to be the vehicle on which the daring idea-that adults
should enjoy chocolate-would ride into the consumer’s psyche.
In other words, the commercial was meant to make him smile at
first-and only then realize the import once of the message, which is
where the comprehension had to be tested. “What was clear in this
case was that likeability would have to include identification and
feeling warmth.”
The Real Taste of Life Campaign
The very first ad in the campaign in 94 was ‘block – Buster’. It
depicted the essence of one and a half glass of milk pouring in to a
boy Dairy Milk unique glass and half in to a chunk icon shows the
glass and a half of full cream milk flowing in to the chunk of dairy
milk conveying the deliciousness and taste appeal of the gooey,
creamy, smooth chocolate inside the pack that children like. The
mnemonic of 1 ½ glass reached to consumer through every
magazines, poster, T.V, newspaper.
The second ad was montage of vignettes from every day lives of
young and old which focused on showing a series of emotions. The
ad created a being out the child in the man created to bring out the
child in the. The old man kicking the football, the pregnant women
craving chocolate, young girls breaking into a spirit, the young man
tossing a bar chocolate at his sweet heart departing into a bus. The
common refrain linking them was the adult in a free child mode –
spottiness, impulsive and carefree.
The ad was protested among adult’s trough focus groups. The ad
received an overwhelming response. It was high on likeability,
evoked a great degree of empathy and identification consumers’
response
were those me…… “Feel like that…….”. “Every feels like this”……..
accessions. Consumers described dairy milk as “… of all ages”
“Eat, when ever you feel like it…you do not have to wait for an
occasion.”
Dairy Milk had successfully enabled the free child in the consumer
subsequent adverting used the same communication strategy.
In other words, the commercial was meant to make him smile at
first-and only then realize the import once of the message, which is
where the comprehension had to be tested. “What was clear in this
case was that likeability would have to include identification and
feeling warmth.”
The New Campaign
And finally, with the launch of the new colloquial advertising
campaign ‘Khaannein Wallon Khaannein Ka Bahana Chahiya
featuring MTV VJ Cyrus Broacha, Cadbury India aimed to
‘substantially’ increase penetration level of the chocolate category
in the next few years.’
The New campaign is worth noting as it clearly differ from the
earlier one in terms of rectifying the consumer perception about
chocolate being an up market impulse – driven product. The
attempt now is to change the image, to make chocolate eating a
regular habit.
The current estimated penetration level of the chocolate category is
19% in the urban market. The objective behind tne new
communication on Cadbury Dairy Milk is to make the chocolate
category more socially and culturally relevant and drive penetration
in the process.
The new campaign has been launched in tandem with the old ar@@
Winning ‘Kuch Khass Hai’ campaign and the media strategy is to let
the two co – exist towards a common vision “providing a Cadbury in
every pocket”.
Chocolate Market Share
The Indian chocolate market is getting bigger and better. While on
one hand, the premium segment (composing imported varieties) is
opening up on the other, companies like Cadbury India are
launching indigenous product made to international standards. Of
the 20,000 tones chocolate market worth about
Rs. 400 crore, Cadbury account for about 70% followed by Nestle,
with a share of around 20%. Amul has about 5% of the market, with
minor player taking the rest. The battle, though, is between
Cadbury and Nestle. Though with a much smaller portfolio, Nestle is
putting up a tough fight.
From a treat for kids, chocolate are now being positioned near meal
substitutes, thanks to the initiative taken by the Cadbury India
during early nineties. The market itself has become more broad
based, in the sense adults are an important target segment now.
The reposting of Cadbury’s Dairy Milk in 1994 as the ‘real taste of
life (through the Slice of Life and Cricket commercial by Ogilvy and
Mather) grew the entire milk chocolate by 20%, and gave the
Cadbury’s range – 5 Star, Gems, Éclairs, Fruit & Nut, Crackle,
Nutties, Butterscotch & Tiffns – a new lease of life. In other words, it
facilitated the repositioning of Cadbury’s sub brands in the basket.
Some o the strategic clicked, while other did not quite take off.
The company is pushing the gifting segment, through occasion
linked gifts. Chocolates contribute to 64% of Cadbury’s turnover.
Confectionary sales accounting for 12% of turnover is contributed
largely by Éclairs. The company attempted expanding its
confectionary product portfolio, with launch of sugar based
confectionary goodly and fruits, without much success. Cadbury
also has a strong brand vita in the malted health drink category
which account for 24% of turnover.
There exists an even larger unorganized market in the
confectionary segment. Cadbury has 4% of the market share in this
segment. Leading national players are nutrine, Pary’s Ravalgoan,
Candico, Parle, Joyoco India and Perfetti, the MNCs such as Joyco
and Perfetti have aggressively expanded their presence in the
country in the last few years.
Malted food drinks category consists of white drink and down drink.
White drinks accounts for almost two third market of the 82,000 for
market south and east are large market for drinks, accounting for
largest proportion of all India’s sale. Cadbury’s Bourn Vita is leader
in the down drink coca based segment in the white drink segment
Smith Kline’s Horlicks in the Nestle Milo , GCMMF nitramul and other
Smith Kline brand Boost, Maltova and Viva Cadbury bold 14%
market share in food drinks segment.
Despite tough market condition and increased competition Cadbury
managed to record a double digit (11%) top line growth in 2000.
The company achieved a volume growth of 5.2%. This was achieved
through innovative marketing strategies and focused advertising
campaign foe flagship brand Dairy Milk. Net profit rose sharply by
41.8% to Rs. 520 million. Reduced material and energy cost and
tioter control over working capital over working capital and capital
expenditure enabled the company to improve the profitability.
Company added 8 million new consumers and saw its outlets grow
to 4.5 lakhs and consumer to 60 million.In the food segment,
Britannia is the leader brand with 21% among those who expressed
an opinion saying that they like advertising for the brand Cadbury
was clearly No.2 with 18% to which CDM throw in its weight with
13% and pork with 4%. For the Chowlate company, Khane Walo Lo,
Khane Ka Bhanna and the Karwa Cauth, Sports are clear winners.
Tied for the brand place are Amul, Parle and south based Arun Le
Gram with 5% each. Disappointment among bid brands Kissan and
Maggi and Kwality Walls (1%) each.
Changing Product Mix
Contributing to
turnover 1998
Contributing to
turnover 2003
Chocolate 59% 64%
Sugar Confecting 9% 12%
Food Drink 32% 24%
Current Market Share
Chocolate 69.2%
Sugar Confectionary 4.0%
Food Drink 14.2%
Expanding Distribution Reach
2001 + Distribution
450000 Retail Outlet
60 Million Consumers
SWOT ANALYSIS
Strength
1.Very strong brand equity in India.
1. Due to its 54 years presence in India – has deep
penetration – 2100 distributors; 450,000 retailers, 60 mid
urban (22%) customers.
2. Three sectors; Chocs (70% share), Confec (4%), food drinks
(14% - leader in brown segment).
3. Low cost of production due to economic of scale. That
means higher profits and / or more competitioners. Better
market penetration.
4. Second best manufacturing location throughout Cadbury
Schweppes.
Weakness
1. Poor technology in India compared to current international
technologies (Godiva, Mozart, Fazer, Dint, Naushans, etc...)
2. Ltd. Key products, only one central brand (CDM). Pralines
range totally wising in India.
3.“Make in India” tag once the economy opens up wore and
imports rush in.
Opportunities
1. Tremendous scope for per capita consumption (160 gms of
8 – 10 kg)
2. Increasing per capita national income resulting in higher
disposable income.
3. Growing middle class and growing urban population.
4. Increasing gifts cultures.
5. Substitute to “Mithais” with higher calories/cholesterol.
6. Increasing departmental stores concept – impulse @ at
cash counters.
7. Globalisation: optimal use of global Cadbury Schweppes.
Threats
a] Major :-
None. Due to low cost and highest brand equity, it is today in India.
b] Minor :-
Globalization will being in better brands for upper end of the
market (Liest, Monarch, Godiva, etc…).
PEST ANALYSIS
Will lose market share with globalization (a la Maruti) but will
remain brand leader.
P: since the budget range is decontrolled, no political effects are
envisaged.
E: 1) increasing per capita income resulting in higher
disposable income
2) Growing middle class/urban population – increase in
demand
3) Low cost of production – better penetration
S: 1) Per capita consumption expected to increase – fashion
2) Increasing gifts culture – increase in demand
3) Lower cholesterol than “mithais” (sweet meat) –
substitute demand
T: Will have to reinforce technology to international levels
once India is a “free” economy
5 P’S OF MARKETING
PRODUCT
Satisfaction suffices. But delight dazzles the average company
will compete for customer by conforming to her expectation
consistently. But the winner will surpass them by constantly
exceeding her expectation, delivering to her door step additional
benefits which she would never have imagined possible. Cadbury’s
offer such product. The wide variety products offered by the
company include:
I. Chocolate & Confectionary
1) Dairy Milk
2) Fruit & Nut
3) 5 Star
4) Break
5) Perk
6) Gems
7) Eclairs
8) Nutties
9) Temptation
10) Milk Treat
II. Beverages
III. Food Drinks
1) Bournvita
2) Drinking chocolate
3) Cocoa
PRICING
Make no mistake. Second P of marketing is not another name for
blindly lowering prices and relying on this strategy alone to increase
sales dramatically. The strategy used by Cadbury’s is for matching
the value that customer pays to buy the product with the
expectation they have about what the production is worth to them.
Cadbury’s has launched various products which cater to all
customer segments. So every customer segment has different price
expectation from the product. Therefore maximizing the returns
involves identifying right price level for each segment, and then
progressively moving through them.
Dairy Milk Rs. 15
Perk Rs. 10
5 Star Rs. 10
Friut and Nut Rs. 22
Gems Rs. 10
Break Rs. 5
Nutties Rs. 18
Bournvita (500 gm) Rs. 104
Drinking chocolate Rs. 50
PHYSICAL DISTRIBUTION:- “PLACE”
BRAND ISN’T THE ONLY ANY MORE. Marketers and finance
manager need a new term to evaluate their business:
Distribution Equity. It takes much more time and effort to build,
but once built, distribution equity is much together to erode.
The fundamental axiom of Indian consumer market is this:
You can set up a state-of –the-art manufacturing facility, hire the
hottest strategies on the block, swamp prime television with best
Ads, but the end of it all, you would be know of selling your
products. The cardinal task before the Indian market is managing is
to shoe-horn its product on retail shelves. Buyers are paying for
distribution equity not brand equity and market shares.
Why does the company need distribution equity more anything in
India? With technology and competitive pressure slash in it is
becoming increasing difficult
for marketers to retain a
unique product
differentiation for ling period.
In a product and price parity
situation, the brand that sells
more is the one that reaches
the highest number of
customers.
India – 1 billion people, 155 million household has over 4 million
retail outlets in 5351 urban markets and 552725 villages, spread
cross 3.28 million sq. km. television has already primed and
population for consumption, and the marketer who can get to the to
the consumer ahead of competition will give a hard – to – overtake
lead. But getting their means managing wildly different terrains-
climate, language, value system, life style, transport and
communication network. And your brand equity isn’t going to help
when it comes to tackling these issues.
Own distribution network consist of clearing and forwarding (C&F)
agents & distribution stockiest. This network of distribution can
either contact wholesalers and which in turn retailers or the
distributors can contact to the retailers directly.
Once the stock product reaches retailers, the prospective customers
can have access to the product.
Cadbury’s distributes the product in the manner stated above.
Cadbury’s distribution network has expanded from 1990 distributors
last year to 2100 distributors and 4,50,000 retailers. Beside use of
TI tom improves logistics, Cadbury is also attempting to improve the
distribution quality. To address the issue of product stability, it has
installed visi colors at several outlets. This helps in maintaining
consumption in summer when sales usually drops due to the fact
that the heal effects product quality and thereby off takes.
Looking at the low penetration of the chocolate, a distribution
expansion would itself being incremental volume. The other reason
is arch rival Nestle reaches more than a million retailers.
This increase in distribution is going to be accompanied by
reduction in channel costs. Cadbury’s marketing costs, at 18% of
total costs, is much higher than Nestlé’s 12% or even pure sugar
confectionery major Parry’s 11%. The company is looking to reduce
this parity level. At Cadbury, they believe that selling confectionery
is it like selling soft drinks.
PROMOTION
If an advertisement is to communicate effectively, the receiver must
at least half want it to, and be prepared too take step toward the
sender. Effective advertising is rarely hectoring or loudly explicit….
It often both attracts and generates arm feelings. More often than
not, a successful campaign has a stronger element of the
unexpected a quality that good advertising shares with much
worthwhile literature.
To penetrate into the inner recesses of her memory, communication
must first ensure exposure, grab her attention evoke her
comprehension, grab her acceptance and then extract retention
competing with thousands of other units of communication trying to
do the same.
Finding showed that the adults felt too conscious to be seen
consuming a product actually meant for children. The strategic
response address the emotional appeal of the band to the child
within the adult. Naturally, that produced just the value vacuum
that Cadbury was looking to fill. Thereafter it was the job of the
advertising to communicate customer the wonderful feeling that he
could experience by re-discoursing the careful, unself conscious,
pleasure – seeking child within himself – a graft these feeling onto
the Ad campaign like “Khane Walon Ko Khane Ka Bahana
Chahiye” for CMD and “Thodi Si Pet Pooja – Kabhi Bhi Kahin
Bhi” for Perk have been sure shot winner with the audience.
Whirl with the new launched temptations with the slogan “Too To
Share” the communication resolves around the reluctance of a
person who’s got their hand on a bar of temptation to let anyone
else to have a bite. As well as outdoor and radio ads, ad agency
contract has created communication for cinemas and even ATM
machines for the brand.
All ICICI’ s ATM a message flashes on the screen as soon as
customer insert his ATM card. It tells the customer that this would
be good time to get out of her temptation since he/she is bound to
be alone. Something familiar is planned for phone-book as well. In
cinemas, Cadbury has a message on-screen just before the lights
are dimmed to give them a chance to get their temptations. There
will also be after dinner sampling in restaurants – to begin with, 30
catteries in Mumbai have been selected.
The next round of activity will include the wafer-chocolate Perk and
the Picnic bar, which has faced problems with its taste, because of
the peanut it contains. Milk treat has also been launched in a
module bar form, just in time of Diwali gifting market. Éclairs has
got potential for much wide distribution, in a small sweets that
airlines, hostels, and up market retail outlet offer to guest and
customers.
Ad spend in 2000 was about 14% of sales and the management said
that plans to maintain as spend at this level in the current year also.
Ad since any discussion today would be incomplete without mention
‘e’ word, the management plans to tap this new channel of
marketing. Beside three company website (i.e.
www.cadburyindia .com, wwww.bourvita.com, www.cadburygift.com
that the company has launched, it had also entered into various
marketing relationship with other portals, specially targeted during
festivals and events such as Valentines day, etc….
It’s a combination of spiffing up its key brand, researching and
improving the newer products that haven’t taken off, supported
with high ad – spends that Cadbury hopes will see it emerges
stronger after the current slowdown, as well as expand the
market.
POSITIONING
In the 1970s consumers were ready to pay “more for more”, and
luxury goods flourished. In the 1980s, consumers began to demand
“more for same”, and the discounting era grew strong. Today’s
consumer demanding “more for less”, and the winner will be that
super value marketers…. Some of today’s most successful
companies recognize those customers are more educated and able
to recognize true customer value…
Positioning is simply concentrating on an idea – or – even a word
defines that company in the mind of the consumer. It is more
efficient to market one successful concept to one large group of
people than 50 product or service ideas to 50 separate group…
repositioning is a must when customer attitude have changed and
product have strayed away from the consumer’s long standing
perception of the… Cadbury’s is an anchor in sea of confectionary
products. As a variety of competitive claims assails her senses,
today customer uses complicated decision making process to
assess the alternative before making a purchase. Since Cadbury’s is
more clearly associated with a particular set of attributes in terms
of benefits and prices, the quicker becomes her search process.
Positioning of individual product:
1. CMD: is and always remain flagship brand. The punch by the
company for advertising this product life. ‘Real taste of Life’,
itself defines the positioning of the product. The chocolate is
meant for all age groups. It symbolizes fun, enjoyment, good
items. It has goodness of milk, taste and appetite appeal.
2. 5 star: although positioned internationally as an energy bar, 5
star was positioned on an emotional platform in India during
the late 1980s. Symbolizing togetherness, 5 star was
originally targeted at teenagers. In June 1994, the company
reworked the strategy for 5 star to make it a source of energy.
In fact, before the launch of Perk, 5 star’s energy bar
positioning made it a snacking chocolate.
3. Éclairs: competing in the chewable toffees segment. Éclairs
was re-launched during the mid-nineties with a new name,
Dairy Milk Éclairs.
4. Gems: broadcasting Gems, though, didn’t prove to be feasible
proposition for Cadbury. Targeted at children under 12 years
with ‘Gems Bond’ advertising. Cadbury decided to too
teenagers with the ‘Smart Very Smart’ campaign. But now,
the company is retargeting children with its animated
commercial. “Gems are the best brand to speak to children.
Colorful .
5. chocolate buttons appeal most to children and that is why
Cadbury is re-targeting children.”
6. Crackle: it was the first Cadbury’s chocolate to have crunch in
it. It was targeted as a funky chocolate to add spark to life.
7. Perk: in September, 1995, Cadbury preempted the launch of
Nestlé’s Kit-Kat by rushing a new brand, Perk into the market.
Positioned much further on the functional scale than 5 star,
Perk was meant to be light snack-product for subduing the
first pangs of hunger.
Bournvita: positioned as tasty health drink. While its competitors
concentrated only on health aspect, Bournvita combined the
nutritious value with taste.
IV. Chocolate & Confectionary
1) Dairy Milk
2) Fruit & Nut
3) 5 Star
4) Break
5) Perk
6) Gems
7) Eclairs
8) Nutties
9) Temptation
10) Milk Treat
V. Beverages
VI. Food Drinks
1) Bournvita
The outlook
The Cadbury management has cut down on its growth target by
setting a 10% average volume target for next 3 years (as against
previous growth) coupled with in factionary price increases, this
could translate into top line growth of 14 –15%. This target also
appears difficult to achieve given the consumer slowdown and the
fact that the company’s consumer slow down and the fact that
company is dependent on a single category chocolates to drive
growth. Effect it expanding confection any portfolio have also not
yielded desired results. The management has declared its intention
to focus only in Éclairs (which forms a major position of its 4% share
in the confectionary segment) for the time being in this category.
In chocolates too ones remain on the 2-3 key brands as CDM, perk
in E claims which have supported growth in the past. While new
launched such as milk @ and Perk slims have been doing will, the
management expects that dairy milk would continue to be the
central driving force in Cadbury’s growth and that all other brands
would remain peripheral to this central brand.
POSITION OF THE VARIOUS BRANDS IN THE MARKET HAS BEEN LISTED
BELOW
Cadburys brands
Positioning Nestle’s brands
Positioning
Cadbury Dairy Milk
Fruit n Nut
Creamy bar
Roast Almond
Crackle
Bournvita
“The Real Taste of Life”
Position as adults as an impulse any time purchase – self expression values attached
Classic Milk Chocolate
Bar One
Positioned as an affordable enriched milk chocolate
Positioned as Trendy, Cool, any time snack.
5 Star / Perk/Break
Perk – Positioned as Snacking consumption “Thodi si Pet Pooja”
5 Star Energy bar Reach for the Stars.
KitKat Positioned as a snacking consumption “Have a Break, Have a Kit Kat”
DATA ANALYSIS AND FINDINGS
Data was tabulated manually and was also analyzed manually.
Excel was used to make graphs had pie charts.
Main technique used were:
Modal value was used to analyze the questions, which has 2 or
more choices as their answers. Simple average were used to get
answer to questions
26% of people are interested in eating chocolate and 74%
are not eating.
The Cadbury brand chocolate 75% of people prefer after
that Nestle, Amul and others are take place.
Most of the people buy chocolate from superstore and
after that from retail or movie mall.
54% people are not aware from this brand while 46% are
aware.
Dairy milk and 5 star is most famous product of Cadbury.
Cadbury chocolate is very easily available in the market.
5. Which cadbury’s product do you usually prefer or use?
6. Do you think Cadbury’s chocolate is easily available in market ?
CONCLUSION
This company project has demonstrated “CADBURY CHOCOLATE
MARKETING STRATEGY WITH ITS MAIN COMPETITORS” that has
proved to be extensive through, and of great benefit to the
company in furthering its competitive advantage. It also helps the
company for building its future planning and targeting the
customers for more satisfaction through its innovative product.
In this project it possible to see the success of Cadbury’s in its
indorse its strong potential to continue to do well and also gives the
ways to maintain its market potential.
RECOMMENDATIONS
Maintain dominance in chocolate, confectionery and market
leadership in blown drinks.
New channels such as gifting, child connectivity and value for
money offering to be the key growth drives.
Grow volume sales at least 20% p.a. over the next years.
Achieve the goal of best manufacturing location in Cadbury
Schweppes world for Dairy Milk and Éclairs.
One new major product launch every year.
Few Concerns Come To Mind
With a market share of 70% in the chocolate category and with the
free availability of international brands that you see in the market
today, it is only natural that Cadbury’s market share will move down
from here marinating a 70% market share in a closed environment
may have been easy, but it certainly won’t be easy in liberalized
environment of free imports. And whatever be the anomalies of
taxation or low, the consumer is surely going to have a wider
choice. And it is going to be shared with other brands too in future.
There is additional challenge of Cadbury’s brand just aiming market
share when the consumer has a wide portfolio of brand to choose
from.
While there would be new chocolates launch towards the end of the
year, the company has ruled out a real big chocolates launch in the
current year. And it is too early yet to comment on the long term
response to the new launch temptations. They say chocolates are
mostly am impulse purchase. Therefore consumer would prefer
smaller, low cost packs to bigger higher priced ones.
The growth trend of the brands therefore clearly indicates that the
only brand that has grown is the one that gas received tremendous
marketing and advertising support Dairy Milk withdraw support for
any brand and growth loses momentum. In such scenario, for how
long and how many brands can the company continuously support?
FUTURE STRATEGY
In the branded impulse market, the share of chocolate in 6.6% and
Cadbury’s share in the impulse segment is 4.8% factor like
changing attitude, higher disposable income, a large youth
population, and low penetration of chocolate (22% of urban
population) point towards a big opportunity of increasing the share
of chocolate in the branded impulse among the costly alternative in
the branded impulse market.
It appears that company is likely to play the value game to expand
the market encouraged by the recent success of its low priced
‘value for many packs’.
Various measures are undertaken in all areas of operation to create
value for the future.
New channel of marketing such as gifting and child connectivity and
low end value for money product for expanding the consumer base
have been identified.
In terms of manufacturing management focus is on optimizing
manufacturing efficiencies and creating a world class manufacturing
location for CDM and Éclairs. The company is today the second best
manufacturing location of Cadbury’s Schweppes in the world.
Efficient sourcing of key raw material i.e. coca through forward
purchase of imports, higher local consumption by entering long
term
contract with farmer and undertaking efforts in expanding local
coca area developing. The initiatives in the terms of development a
long term domestic coca a sourcing base would field maximum
gains when commodity prices start moving up.
Use of it to improve logistic and distribution competitiveness
`Utilizing mass media to create and maintain brands.
Expand the consumer base. The company has added 8
million new consumer in the current year and how has
consumer base of 60 million although the growth in absolute
numbers is lower than targeted, the company has been able
to increase the width of its consumer base through launch of
low priced products.
Improving distribution quality by addressing issues of product
stability by installation of visi coolers at several outlets. This
would be really effective in maintaining consumption in
summer, when sales usually dip due to the fact that the heat
effects product quality and thereby consumption.
The above are some steps being taken internally to improve
future operation and profitability. At the same time the
management is also aware of external changes taking place
in the competitive environment and is taking steps to remain
competitive in the future environment of free imports, lower
barrier to trade and the advent of all global players in to the
country. The management is not unduly concerned about the
huge deluge of imported chocolate brands in the market
place.
It is of the view that size of this imported premium market is
look small to threaten its own volumes or sales in fact, the
company looks at the tree important as an opportunity, where
it could optimally use the global Cadbury Schweppes portfolio.
The company would be able to not only provide greater
variety, but it would also be more cost effective to test market
new product as well as improve speed of response to change
in consumer preference through imports. The only concerns
that the company has in this regard is the current high level
of duties, which limit the opportunity to launch value for
money products.
BIBLIOGRAPHY
Philip Kotler (Eighth Edition) “Marketing Management”,
Prentice Hall of India Ltd.
Advertising and marketing Magazine
Company Literature
Market survey and questionnaires
Web site: www.cadburyindia.com
Web site: www.google.com
Business World
QUESTIONNAIRE
1. Do you eat chocolates? Yes No
2. Which brand of chocolates do you use? Cadbury’s Nestle Amul Others
3. Where do you buy chocolates from? Super stores Retail Stores Restaurants Movie Halls Others
4. Are you aware of any campaign of the above brands? Yes No
5. Which cadbury’s product do you usually prefer or use? Dairy Milk 5 Star Fruit & Nut Perk Temptation
6. Do you think Cadbury’s chocolate is easily available in market ? Yes No
7. Describe Cadbury’s Chocolate in one word?______________________________________________________
8. Your comments on Cadbury’s products?______________________________________________________