Professional Documents
Culture Documents
ON
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CERTIFICATE
This also certify that this project work is the result of the candidate’s own work
and is of sufficiently high standard to warrant its presentation for the BBA
program.
To the best of my knowledge this project or its part has not been submitted to
this university or any other university for any Degree/Diploma.
Sonal Dubey
Place: Nagpur
Date: Director
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ACKNOWLEDGEMENT
I am grateful to my parents for their lovable support. Last but not least I am
thankful to my friends and other faculty members for their direct and indirect
help for completion ofthis work.
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DECLARATION
SANJANA THAKUR
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CHAPTERAISATION
1. Introduction 7
2. Objectives 19
3. Company Profile 25
6. Findings 51
8. Limitations 57
9. Bibliography 59
10. Annexure 61
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Executive Summary
The journey of Cadbury Dairy Milk started way back in the year 1905 from Bourneville,
UK but it came to the Indian market in 1948. From the time it was introduced in India,
Dairy Milk has been the market leader in the confectionery segment commanding a
30%market share and average daily sales of 1 million bars. The reason that our group chose
Cadbury dairy milk for the brand audit is that it provides us with ample scope to study the
various aspects of branding like communication strategies, innovative ad campaigns,
establishing an emotional connect with consumers, brand repositioning, rebranding etc.
We’ll be studying the evolution of Cadbury dairy Milk by concentrating on the following
aspects:
How dairy milk redefined the chocolate segment from being seen as ‚meant for kids‛
to a thing to be enjoyed by everyone in moments of joy and celebration by targeting
the adult segment.
Dairy Milk has always tried to keep a strong association with milk, with slogans such
as "a glass and a half of full cream milk in every half pound" and advertisements that
feature a glass of milk pouring out and forming the bar.
Its use of innovative and interesting ad campaigns to make chocolate eating a habit
among the consumers, especially the adults.
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CHAPTER 1
INTRODUCTION
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1. INTRODUCTION
Marketing is the science of meeting the needs of a customer by providing valuable products
to customers by utilizing the expertise of the organization, at same time, to achieve
organizational goals.
Marketing is the activity, set of institutions, and processes for creating, communicating,
delivering, and exchanging offerings that have value for customers, clients, partners, and
society at large.
With this definition, it is important to realize that the customer can be an individual user, a
company, or several people who contribute to the purchasing decision. The product can be a
hard good, a service, or even an idea – anything that would provide some value to the person
who provides an exchange. An exchange is most often thought of as money, but could also be
a donation of time or effort, or even a specific action. A producer is often a company, but
could be an individual or non-profit organization.
Classical marketing is often described in terms of the four “P’s, which are:
A complete analysis of these categories is often called the Marketing Mix. More detail on
these categories can be found in the later entry on the Marketing Plan.
Marketing has both inbound and outbound activities. Inbound activities largely center on
discovering the needs and wants of the potential customers. The collective group of all
potential customers is called a market. Categorizing these needs into groups is called
segmentation. Organizing markets into segments allows a producer to more logically decide
how to best provide value to that group of potential customers. The analysis of market
segment needs; analysis of existing sales and profitability; the descriptions, design and
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introduction of new products; and the analysis of competitor offerings are also inbound
activities that are important but not often seen by the public.
Outbound activities include all aspects of informing the market that a product is available,
delivering that product, and encouraging the purchase decision. These activities include
advertising, promotion, supply chain, sales support, product training, and customer support.
To the public, the most common interaction with marketing is where it touches the discipline
of sales in the form of advertising. This interaction leads to a common misconception that
marketing is only this aspect of promotion. Instead, it is useful in understanding that:
The good marketer will develop the data necessary to define the customer’s needs, develop a
good product based on the available resources, deliver the product in an effective manner to
the consumer at a price that reflects the customer value and the profit desired by the producer.
1. Creation of Demand
2. Customer Satisfaction
3.Market Share
4.Generation of Profits
5.Creation of Goodwill and Public Image.
The basic purpose of marketing management is to achieve the objectives of the business. A
business aims at earning reasonable profits by satisfying the needs of customer
1. Creation of Demand:
The marketing management’s first objective is to create demand through various means. A
conscious attempt is made to find out the preferences and tastes of the consumers. Goods and
services are produced to satisfy the needs of the customers. Demand is also created by
informing the customers the utility of various goods and services.
2. Customer Satisfaction:
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The marketing manager must study the demands of customers before offering them any goods
or services. Selling the goods or services is not that important as the satisfaction of the
customers’ needs. Modern marketing is customer- oriented. It begins and ends with the
customer.
3. Market Share:
Every business aims at increasing its market share, i.e., the ratio of its sales to the total sales
in the economy. For instance, both Pepsi and Coke compete with each other to increase their
market share. For this, they have adopted innovative advertising, innovative packaging, sales
promotion activities, etc.
4. Generation of Profits:
The marketing department is the only department which generates revenue for the business.
Sufficient profits must be earned as a result of sale of want-satisfying products. If the firm is
not earning profits, it will not be able to survive in the market. Moreover, profits are also
needed for the growth and diversification of the firm.
The marketing manager attempts to raise the goodwill of the business by initiating image-
building activities such a sales promotion, publicity and advertisement, high quality,
reasonable price, convenient distribution outlets, etc
Marketing process:
Marketing process includes ways in which value can be created for the customers to satisfy
their requirements. It is an endless series of actions and reactions between the customers and
the companies making attempt to create value for and satisfy the needs of customers.
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The following four steps are involved in the marketing process −
Situation Analysis
Analysis of the situation in which the company finds itself serves as the basis for identifying
chances to satisfy unfulfilled customer needs.
Marketing Strategy
After identifying the marketing options available, a strategic plan is developed to pursue the
identified options. An analysis is done and the best available option is chosen; a plan or
strategy is made for that option.
This being the final step, it transforms the written or planned strategy into action and the
product is presented according to this process.
• Selling
• Transportation
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• Storage
• Financing
• Risk Taking
• Market Information
The marketing process performs certain activities as the products and services move from
the producer to consumer. All these activities or jobs are not performed by every company.
Nonetheless, it is recommended that they be carried out by any company that wants its
marketing systems to function successfully.
Selling
Selling is the crux of marketing. It involves convincing the prospective buyers to actually
complete the purchase of an article. It includes transfer of ownership of products to the
buyer.
Selling plays a very vital part in realizing the ultimate aim of earning profit. Selling is
groomed by means of personal selling, advertising, publicity and sales promotion.
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Effectiveness and efficiency in selling determines the volume of the firm’s profits and
profitability.
It deals with what to buy, of what quality, how much from whom, when and at what price.
People in business purchase to increase sales or to decrease costs. Purchasing agents are
much tempted by quality, service and price. The products that the retailers buy for resale are
selected as per the requirements and preferences of their customers.
Assembling means buying necessary component parts and to fit them together to make a
product. ‘Assembly line’ marks a production line made up of purely assembly functions. The
assembly operation includes the arrival of individual component parts at the work place and
issuing of these parts for assembling.
Assembly line is an arrangement of employees and machines in which each individual has a
particular job and the work is passed directly from one employee to the next until the
product is complete.
Transportation
Transportation is the physical means through which products are moved from the places
where they are produced to those places where they are needed for consumption. It creates
locational utility.
Transportation is very important from the procurement of raw material to the delivery of
finished products to the customer’s places. Transportation depends mainly on railroads,
trucks, waterways, pipelines and airways.
Storage
It includes holding of products in proper, i.e., usable or saleable, condition from the time
they are produced until they are required by customers in case of finished products or by the
production department in case of raw materials and stores.
Storing protects the products from deterioration and helps in carrying over surplus for future
consumption or usage in production.
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Standardization means setting up of certain standards or specifications for products based on
the intrinsic physical qualities of any item. This may include quantity like weight and size or
quality like color, shape, appearance, material, taste, sweetness etc. A standard gives rise to
uniformity of products.
Grading means classification of standardized items into certain well defined classes or
groups. It includes the division of products into classes made of units possessing similar
features of size and quality.
Grading is very essential for raw materials; agricultural products like fruits and cereals;
mining products like coal, iron and manganese and forest products like timber.
Financing
Financing involves the application of the capital to meet the financial requirements of
agencies dealing with various activities of marketing. The services to ensure the credit and
money needed and the costs of getting merchandise into the hands of the final user are
mostly referred to as the finance function in marketing.
Financing is required for the working capital and fixed capital, which may be secured from
three sources — owned capital, bank loans and advance & trade credit. In other words,
different kinds of finances are short-term, medium-term, and long-term finance.
Risk Taking
Risk means loss due to some unforeseen situations. Risk bearing in marketing means the
financial risk invested in the ownership of goods held for an anticipated demand, including
the possible losses because of fall in prices and the losses from spoilage, depreciation,
obsolescence, fire and floods or any other loss that may occur with the passage of time.
They may also be due to decay, deterioration and accidents or due to fluctuation in the prices
induced by changes in supply and demand. The different risks are usually termed as place
risk, time risk, physical risk, etc.
Market Information
The importance of this facilitating function of marketing has been recently marked. The only
sound foundation on which marketing decisions depend is timely and correct market
information.
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The importance of this facilitating function of marketing has been recently marked. The only
sound foundation on which marketing decisions depend is timely and correct market
information.
Marketing has many aspects or sub-disciplines within the broad discipline of marketing. They
include:
• Advertising.
• Branding.
• Copywriting.
• Direct marketing.
• Internet Marketing.
• Loyalty marketing.
• Market research.
• Marketing communications.
• Media relations.
• Merchandising.
• Pricing.
• Product management.
• Promotion.
• Public relations.
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• Search engine optimization (SEO).
• Strategic planning.
Marketing functions in all of these areas. A marketer can do many of these functions within
an organization or specialize in one or more.
Marketing Strategy
In the field of marketing, once a business is finally able to adequately profile its customers
and competitors, along with its competitiveness in a particular industry, marketing managers
can design marketing strategies that are important in capitalizing on company profits and
resources. Important strategic decisions in marketing are grounded on specific objectives
such as that of maximizing revenue, market share, and level of profitability.
In attaining the marketing objectives, a company must determine the specific market
segments targeted for the particular business. With a specific selection of target customer
segments, company resources are maximized instead of being put to waste and revenue
increases subsequently. Additionally, companies are also able brand their business with a key
benefit that distinguishes the company from the rest of its competitors.
When the market is treated as homogeneous group of individuals where the same marketing
mix is offered to customer market-wide, It is called Mass marketing. Its employs mass
production, distribution, and product dissemination.
However, since every individual has personal preference, it is quite impossible to satisfy all
customers by giving the equal treatment and offering the same product and services. A
business has to be sensitive to the need of the customers. If not, a competitor might take
advantage and address the need of your customers that was not fulfilled.
On the contrary, when a company understands and recognizes the difference of the customers
‘need and does not offer the same product a service to everyone, this is called target
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marketing. So, the diverse market is then classified based on various factors and
consideration.
The process of the dividing the market into classified group is called market segmentation. A
company is able to better satisfy the needs of its customers when they are properly segmented
depending on the need and commonalities of the customers.
A true market segment meets the criteria that are required of a company. Effective market
segmentation is a product of proper categorization of different customers. Accessibility is one
of the criteria which mean that the target market should be closely available to the company.
This includes the ease of communication and distribution channels.
Another factor that should be considered is that a market segment should be identifiable. This
means that the different characteristics and similarities of the segments are determined so that
one market segment can be distinguished from another.
A market segment must also be substantial .A high volume or production must satisfy market
segment that are sufficiently large enough in order to properly distribute the product to them.
The availability of the product must considerably compensate a large market segment for an
increased profitability.
Apart from substantiality, durability must be considered in a market segment. Since people
have changing preferences, it is better to cater to a market segment that does not alter too
quickly in their tastes .The segments must keep a sense of stability in order to minimize
frequent changes.
Lastly, market segments must be evaluated on their unique needs. They must have
differences in their responses to the marketing mixes in order to justify the various product
that are offered .To illustrate, let us use bath soaps as an example. Some people prefer those
with whitening components while others would go for the moisturizing effect. Even others
have unique needs on the kind of soap the use.
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A large, diverse market is classified into different factors bus these factors are consistent in a
particular segment. For a consumer market, there are four main categories in segmenting the
market .One of which is geographic segmentation where regional variables are considered.
Examples of these variables are region, population size, population density, and climate.
Some companies take advantage of selling suntan lotions in tropical regions such as Hawaii
while other businesses promote fur coats in colder places like Alaska.
Demographic segmentation relies on variables like age, gender, ethnicity, religion, education,
occupation, income, social status and family status and size. The customers are grouped
basing on the particular need and tastes.
Market Segmentation
For most business firm, locating and specifically targeting unique market segments is both a
reality and a necessity in today’s competitive marketplace. In North America, for example,
the assumptions of the mass market no larger hold true for businesses and product categories.
Creative market segmentation strategies often afford the business organization a strategic
advantage over its competition. Foreign firm often enter a domestic market by segmenting the
market, uncovering and underserved niche, and then concentrating their marketing and
financial resources into that niche.
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CHAPTER 2
OBJECTIVES
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2. OBJECTIVES
To examine the marketing strategies of Cadbury India
To understand the essence of the 4 P’s of Marketing with respect to the marketing
efforts of Cadbury India
Corporate objectives
Sales objectives
Advertising objectives
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Corporate Objectives
India wants to achieve in the next four years what it has in the last 50 years.
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Sales Objectives
Double its turnover—which stood at Rs.1, 0000 crore in 2014—by 2020. This
calls for a growth rate of over 20 percent annually and will be done by setting up
new capacity, and increasing volumes
Get more people to eat more chocolate, which calls for making it more
affordable and being more innovative
Could get into new product categories like gums where the global portfolio is
impressive
Like most players with near-monopoly shares, Cadbury runs the risk of losing share to
new players like Hershey’s, ITC (with brands like Minto and Candyman) as well as to
premium imported chocolates. But that may not be much of a worry if Cadbury
succeeds in growing the market. They could, for instance, hold a 50 per cent share but
of a much larger pie.
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Advertising objectives
Consumer centric:
Continue to engage in regular dialogue with its suppliers and responds to their
suggestions
Protection and ethical labour practices prior to doing business with them
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CHAPTER 3
COMPANY PROFILE
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3. COMPANY PROFILE
Confectionery is a unique impulse category because it’s eaten regularly throughout the
day rather than specifically at meal times. Confectionery now accounts for 24% of all
food media spend, more than any other food category. According to a survey, purchase
levels for confectionery are significantly higher than any other impulse
category.
The Indian chocolate market is estimated to be worth Rs. 3.2 billion, with an annual
growth rate of 10 percent. Per Capita Consumption levels are very low in India, as
compared to 8.7 kg per year in the U.K. The market therefore offers tremendous
potential for growth. In our analysis we are concentrating on the chocolate industry in
general and Cadbury’s in particular. Cadbury India Limited (CIL), a part of the
Cadbury Schweppes Group, is India’s leading confectionary manufacturer. Cadbury’s
Dairy Milk, 5 Star, Éclairs, Perk and Gems are the largest selling brands in their
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segments. CIL is estimated to have a 65 percent share of the Indian chocolate market.
In fact the word Cadbury is a classic example of a brand coming to symbolize a
product category.
Cadbury India
It has manufacturing facilities in Thane, Induri (Pune) and Malanpur (Gwalior),
Cadbury India began its operations in India in 1948 by importing chocolates. It now
Hyderabad, Bangalore and Baddi (Himachal Pradesh) and sales offices in New Delhi,
Mumbai, Kolkata and Chennai. The corporate head office is in Mumbai. The head
office is presently situated at Pedder Road, Mumbai, under the name of "Cadbury
House". This monumental structure at Pedder Road has been a landmark for the
citizens of Mumbai since its creation. Since 1965 Cadbury has also pioneered the
development of cocoa cultivation in India. For over two decades, Cadbury has worked
with the Kerala Agricultural University to undertake cocoa research.
Cadbury was incorporated in India on 19 July 1948. Currently, Cadbury India operates
in five categories – Chocolate confectionery, Beverages, Biscuits, Gum and Candy.
Some of the key brands are Cadbury Dairy Milk, Bournvita, 5 Star, Perk, Bourneville,
Celebrations, Gems, Halls, Éclairs, Bubbaloo, Tang and Oreo. Its products include
Cadbury Dairy Milk, Dairy
Milk Silk, Bourneville, 5-Star, Temptations, Perk, Gems (a version of M&M's),
Eclairs, Bournvita, Celebrations, Bilkul Cadbury Dairy Milk Shots, Toblerone, Halls,
Tang and Oreo.
It is the market leader in the chocolate confectionery business with a market share of
over 70%. Cadbury India, on 21 April 2014, changed its name to Mondelez India
Foods Limited.
Cadbury is the leader in Chocolate with 70% share. It has actually become the generic
name for chocolates in India.
Cadbury with its Dairy Milk, Five Star, Milk Treat, Eclairs, Golden, is ruling the
roost. In chocolate-based drinks, it claims nearly 50% of the market. Cadbury India's
market share in cocoa-based products is 35%, with Dairy Milk brand alone
accounting for 29%. Perk and Five Star account for another 20%. Cadbury derives
76% of its revenues from chocolates and other confectionery sales.
The next closest competitor to Cadbury in this segment is Nestle 22%. Besides that large
foreign brands like Hershey’s and local ones like ITC are trying to tread into Cadbury’s
turf. Imported chocolates are available via modern trade in higher end segments where
Cadbury’s presence is arguably weaker.
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To push sales further, chocolate majors have been targeting adult audiences.
Chocolates are being presented a snack food for the new target audiences. Another
strategy sought is the introduction of smaller editions.
Although the players have resorted to very aggressive promotional drives, there has been
After the worm controversy in October 2003, there was a meltdown in chocolate sales.
Cadbury India appears to be on a recovery path. 9
Growth between 2008 and 2012, the Indian chocolate industry is projected to grow
world's fastest growing market for chocolates. Registering 15% annual even higher
rate in the coming years.
The Population of India in 2013 is 1.27 billion. The chocolate consumption number comes
around 2, 09,550 ton.
400 Kgs of chocolate consumption is done in India per 3 minutes
Low priced unit packs, increased distribution reach and new product launches can be said
to have fuelled this growth.
The industry has a positive outlook due to phenomenal growth in the confectionery
industry, rising per capita income and gifting culture in the country. The per capita
consumption of chocolates is increasing in the country which will continue to
flourish the market revenues. It is expected that India chocolate industry will be
growing at the CAGR 23% by volume between the years 2013-2018 and reach at
3,41,609 Tons. The dark chocolates are expected to account for the larger market
share when compared to milk and white chocolates in the coming years. The
introduction of medicinal and organic ingredients in the manufacturing of chocolates
had led to a new trend and development in the country, which will be adapted by
major manufacturers to remain active in the market.
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Figures 1.4 Myriad Data of the Chocolate Industry
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CHAPTER 4
Research
Methodology and
Data Collection
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4. Research
Methodology and
Data Collection
Achieving accuracy in any research requires in depth study regarding the subject. As the
prime objective of the project is analyze the marketing strategies of Cadbury, the research
methodology adopted is basically based on primary data via which the most
recent and accurate piece of firsthand information could be collected. Secondary data has
been used to support primary data wherever needed.
Questionnaire Method
Physical
Virtual (Online)
Observation Method
The main tool used was, the questionnaire method, observation method has been continuous
with the questionnaire method, as one continuously observes the surrounding environment
one works in.
Target geographic area was Kolkata .To the above mentioned geographical area
questionnaire was given. Finally the collected data and information was analyzed
and compiled to arrive at data the conclusion and recommendations given.
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Sources of secondary data
Used to obtain information about Cadbury and its competitor history, current issues,
policies, procedures etc, wherever required.
Internet
Magazines
Newspapers
The vast gamut of internet provided access to wide knowledge base, which added to
the content of this project substantially.
Sampling Techniques
Some data was also obtained through online surveys using Google Docs and Forms
Research Period:
Research Instrument:
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This work is carried out through self-administered questionnaires. The questions
included were open ended, dichotomous and offered multiple choices.
Barriers To Entry
The industry’s main barrier to entry is with respect to advertising. The incumbent
firms have spent millions of rupees to create brand-loyalty with consumers. The
cumulative effects of advertising create an absolute cost advantage for the incumbent
firms, thus entrants must overcome not only current advertising efforts, but also the
lingering impact of past marketing campaigns. High sunk costs also act as a barrier
to entry.
Supplier Power
Industry uses a wide range of raw materials in manufacturing chocolate products, the
main ones being cocoa beans, sugar and other sweeteners (including polyols and
artificial sweeteners such as aspartame), dairy products (including milk), gum base
and fruit and nuts. Cadbury buys its raw materials from suppliers around the world.
No single supplier accounts for more than 10% of their raw material purchases. One
of the methods implemented by Cadbury to minimize the impact of price fluctuations
and ensure security of supply is by entering into forward agreements and long-term
contracts wherever available.
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Cadbury imports cocoa beans from West Africa, primarily Ghana, and the Americas.
West Africa accounts for over 60% of world production. They buy cocoa beans and
cocoa butter from a range of suppliers, and try to minimize the effect of cocoa price
movements and secure our future requirements by entering into forward and future
contracts. In order to ensure assured supply of raw material for its chocolates,
Cadbury India Limited has decided to sell cocoa seedlings to coconut farmers in
Tamil Nadu at Rs 4 per seedling. A MoU was signed between Cadbury India and the
Tamil Nadu government to this effect. They purchase most of the sugar at prices
essentially set by national government through quotas and duties. So far no difficulty
has been experienced in obtaining adequate supplies of sugar for their operations,
and they do not anticipate any future difficulties, given the many available sources.
Buyer Power
End consumers have strong buyer power because of the availability of substitutes,
both generic and brand names. It is easy for a consumer to purchase a nearly
identical product for a lower price. This gives consumers a great deal of leverage and
leads Cadbury to spend millions of rupees to create product differentiation via
advertisements and new products to catch up with the evolving trends in the market.
Retail stores have significant buyer power due to their ability to charge high fees for
shelf space, which is important channel of distribution for Cadbury. Cadbury has
worked hard to build strong relationships with these retailers to minimize this affect.
Substitutes
The current trends in the market suggest that traditional sweets are possible
substitutes for chocolates. This is further stressed by the fact that till a few years
back chocolate was not considered to be a gift item unlike sweets. However, in
recent years this scenario has changed quite rigorously because of an innovative
strategy taken up by Cadbury.
In order to strengthen the special relationship consumers share with chocolates,
Cadbury India launched its all-year-round ‘Cadbury Celebration gifting’ range with
an array of newly designed
Cadbury Celebration packs. The range features a selection of stylish new packs
available in “Nutbutterscotch”, “Caramel”, “Almond Magic”, “Cashew Magic” &
“Raisin Magic”. The range is priced between Rs 145 & Rs. 155 and is available in all
premium retail outlets across major towns in India. There is also a wide selection of
online vendors that offer Cadbury Celebration range for all kinds of occasions.
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PEST Analysis
The Food Safety and Standard Bill, 2005 with penal provisions requires
a review as the same gives huge powers to the Inspecting Officers to
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seize food articles without authorization and may create unwanted
confusion to the detriment of the company
Economic:
The prices of cocoa and milk, the chief ingredients used in chocolates, have gone
up by 50 per cent, while the price of sugar, another important raw material, has
come down. The overall input costs have gone up by 20 per cent. India imports
most of its cocoa requirements and the prices of cocoa have risen globally due to
unavailability of cocoa. If the prices of these commodities keep increasing,
Cadbury will be forced to increase the prices
Low margins, high volumes, price sensitivity of the industry and competition
from cheaper substitutes leaves little room for price maneuvering.
Social:
In October 2003, seizure of chocolates stock from Pune plant after worms were
found by customers in Dairy Milk packages; Sales dropped by 30 percent where
it was expected to grow by 15 percent owing to the festive season;
Advertisements went off air for a month and half; To regain the lost faith of
customers, Cadbury invested in technology to the tune of Rs.15 crore, roped in
Amitabh Bachchan as the brand ambassador and upped ad spends by 15 percent
Technological:
e-Commerce has not picked up that well - not much turnover through this route –
future growth prospects of this channel
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SWOT Analysis
Strength
Cadbury being a reputed company has its brand name as one of its biggest
strengths. It has been present for over 65 years even before competition could
peep-in. Due to its presence for so many years people tend to associate
chocolate with Cadbury. It is almost as if Cadbury is synonymous with
generic category chocolate. Cadbury is a very profitable organization,
generating revenue in billions. Cadbury India Ltd is supported by its parent
company, Mondelez International. A large range of products like - chocolates,
beverages, malted foods etc. are manufactured by Cadbury. These products
are reasonably priced to suit different economic consumer categories.
Celebrity endorsements have increased sales and also added glitter to the
brand name. Cadbury India has the biggest market share at 67 per cent while
Nestle is the second largest at 21 per cent. Amul & other holds the rest. In
spite of innovation in the chocolate segment, their basic chocolate, Dairy
Milk, still seems to remain the all-time favourite of most people. Low cost of
production due to economic of scale. That means higher profits, better market
penetration with the strong distribution network.
Weaknesses
Opportunities
As Cadbury has established itself very well in the Indian market, it can now narrow down to
some popular products and can bring down its own individual Cadbury’s store. It has
capabilities to increase the range of products manufactured. The company can easily venture
into new segments individually or jointly. Another very important opportunity that can be
observed is the introduction of foreign products in India. The company can focus on
targeting urban areas and developing sectors by working on availability and affordability.
The company aims at bringing efficiency in logistics and distribution. This can very well be
achieved by using information technology. Cadbury can also focus on gaining profits
through chewing gum market in India.
Threats
As Cadbury has already faced a worm scandal, its reputation has been put at stake
by the competitors trying to exploit this situation. Cadbury faces a serious threat in
the confectionery segment from companies like Amul, Nestle, etc. As Cadbury
produces chocolates and a few related products, effective management of all the
areas proves to be difficult at times. Trends of purchase may change with the
everchanging taste preference of consumers. Changing restrictions and rules from
Government quality control boards may result in pressure on the production of the
company & cost increase. Also, Cadbury is exposed to rise in the cost of cocoa
beans, dairy products and other vital ingredients.
Customers
The prospective customer of dairy milk range from 5 to 60 years of age.
Since dairy milk has a range of product suited for every member of the
family. The aim is to strengthen the brand relationship in the current
consumer’s life. The ranges of customers vary for diary milk. Whereas some
buy it as an alternative for sweet others buy it as a gift item. The consumers
mostly buy the product on impulse and are influenced by taste/flavour and
then by company/brand.
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Competitors
The main competitors of Dairy milk in India are Nestle, Ferrero Rocher,
Amul chocolates & unbranded chocolate. The high end chocolates
(Bourneville and silk) also face competition also face competition from the
imported Swiss chocolates. But one of the biggest advantages the dairy milk
has over its competitors is the brand loyalty that it has got. The excellent
advertising, reach and accessibility have made it the top of mind brand in the
chocolate category.
Climate
The climate for the chocolate industry and dairy milk in particular seems very
attractive in a country like India. With the size of the market being so big
along with encouraging category growth the prospects look very good. Since
the product is not seasonal and the margin is also good makes the climate for
the industry even better. With new innovations coming up in terms of product
and packaging the market is still on a growth curve.
Collaborators
As already said Cadbury dairy milk manages a huge range of retailers and
whole sellers who make up the collaborators. Over the years the company has
partnered with various other companies like Adam Philippines in 2001 so that
diary milk has a much wider distribution network in the Philippines.
Segmentation
For more than six decades now, Cadbury has enjoyed leadership position in
the Indian chocolate market to the extent that 'Cadbury’ has become a generic
name for chocolate products. Cadbury has leading brands in all the segments
viz bars (Dairy Milk, Crackle, Temptations), count lines (5 star, Milk Treat).
38
Figure: 3.1 Cadbury India’s Market Share in different Segments 2012
(Source: Business today)
Segmentation Graph
39
High Premium
Snack Indulgence
Low Priced
Targeting
Starting from 1905 the purchasers of dairy milk have changed from children to all
age groups. When Cadbury started its operation in India their main buyers were
children and the youth who brought chocolates to celebrate special occasion. This
limited the market for Cadbury dairy milk. This is a reason that Cadbury came out
with the campaign of (‘kuch meetha ho jaye’) to make dairy milk synonymous with
sweet so that it could target all the age groups. In India it was a mentality that
chocolates are for children and the adults were more inclined towards to the
conventional sweets. This campaign targeted them and saw a change in the target
market for the brand. Now the target market for dairy milk is every member of the
family.
Cadbury’s Dairy milk always aimed for the bigger bite of the Indian market. It has
been the market leader in the chocolate category for years.
40
The main objective of Cadbury’s dairy milk is very clear, reach the audience by
showing them their reflection. Showing small happiness and cheerful moments that
we see in our day to day life is cherished by enjoying a bite of
Cadbury’s Dairy milk and by adding an emotional touch to it, & has won the Indian
audience thoroughly.
They are Positioning Diary milk as a successful alternative to the traditional Indian
sweets in unique way in order to cash in the rich tradition of Indian people associated
with desserts, birthday gifting through Facebook, gifting in schools (15th August &
26th Jan-13) & on birthdays, gifting in offices on birthday’s & gifting with marriages
invitation card & after marriage ceremony.
Positioning
Cadbury Dairy Milk excels at positioning. Not only can the chocolate bars have
many different positions based on which segment they are in, but also none of the
positions damper the effects of other positions! Youth see with word Cadbury as a
synonym for chocolate, others see it as synonyms for sweet and love and bliss. In
India it positioned itself as “spontaneous, special, carefree, real moments (‘Mazza aa
gaya’) in the initial stage. But later it tried to position itself as brand that is
synonymous with sweet (‘Kuch meetha ho jaye’). The most recent campaign
(‘Shubh Aarambh’) tries to take forward the initial positioning of dairy milk as an
alternative for the traditional sweet and positions itself as something that is as
auspicious as the sweet which is generally offered as ‘bhog’ to gods.
There are five he product life cycle model helps marketers identify the different
stages that the sales
stages to the product life cycle: introduction, growth, maturity, saturation and decline.
1. Introduction: Sales are slow as the product is not yet known. Costs are high
due to heavy marketing spend to create awareness. Emphasis is on advertising and
distribution. The Cadbury Dairy milk launched by Cadbury in 1905 is an example of
a brand at the introduction stage.
2. Growth: This stage shows growing market acceptance and increasing profits.
Competitors begin to enter the marketplace. The business concentrates on optimizing
41
product availability. The Cadbury Dairy milk is the market leader in chocolate
market with 30 % market share example of brand at growth stage.
3. Maturity: The rate of sales growth slows down as the product has been
widely distributed and sold. The company now focuses on creating brand extensions
and promotion offers to boost sales. New product research is critical to ensure future
sales. The Cadbury Dairy Milk Silk chocolate range is an example of creating brand
extensions brand at the maturity stage.
4. Decline: Sales slow down dramatically and profits fall off. The product may
be dropped to make way for new products and the cycle recommences. So far CDM
has not reached at this stage because of extension in maturity stage.
Figure 3.4 PLC of Cadbury Dairy milk Source: Ipsos Indica Research
42
CHAPTER 5
43
5. Data Integration and
Analysis
The data collected through survey was analyzed with help of simple percentages. Tabular
and graphic methods, which included pie charts and bar graphs, were used to analyze data.
Microsoft Excel was extensively used in the preparation of the data in to meaningful
coherent and simple information graphics:
Bar Graphs
Pie Charts
Line curves
Tools of Analysis:
To determine the level of satisfaction for the various categories combined mean is used.
Since Likert scale is used to find out the satisfaction level the value of combined mean
shows the level of satisfaction from 1 to 5 and 2.5 is the middle point. Higher the value of
mean shows higher satisfaction level and lower the value of mean shows lower satisfaction
level
44
Survey Results
T
in India. The chocolat e consumers were asked questions like the chocolate brand that he
survey was carried out by in order to find out the reach and popularity of Cadburys
they normally eat, and the features that they look for in a chocolate etc. The chocolate
consumers had ranked Cadburys as the best chocolate brand and a few consider Nestle as a
good chocolate brand. It was also observed that Cadburys is facing strong competition from
foreign brands. This could be due to the fact that the respondents of our survey were mostly
the well to do population from the middle, upper-middle and upper class of people
We had 100 respondents to our survey. Most of the respondents were from the 18-25 and
2650 age groups. Most of the respondents spent more than 100 rupees on chocolates in a
month. Almost 70% people rated Dairy Milk the most consumed chocolate closely followed
by 5 star and Perk. Also the reason why Dairy Milk was preferred was because of the taste.
66% people preferred to gift celebrations for many occasions as against 23% who prefer
gifting foreign chocolates.
Thus I understood better the chocolate market in India. Cadbury’s has a very good market
share currently but will have to constantly revamp their strategies in order to compete with
the foreign brands.
45
Figure 4.1:
Pie chart depicting the most common consumption reasons of Cadbury
18% 22%
Self Consumption
Gif
29%
31% For Children
Festival
Figure 4.2
Pie chart depicting consumer preferences for chocolates
CONSUMER PREFRENCES
Cadbury Nestle Amul Others
9% 1%
18%
72%
Figure 4.3
Word cloud showing most commonly used adjectives people associate with Cadbury
Figure 4.4
Area Graph depicting the various occasions of Cadbruy purchase
Occasions of Purchase of Cadbury
40
20
9 22
23 31
0
15
Before
Express Occasions of Purchase of Cadbury
good work Celebrate
Feelings Gifing
Casual
Figure 4.5
Bar graphs showing age distribution of Cadbury’s consumers
30
25
20
15
10
0
Below 10 years 10-17 years 18-25 years 25-50 years 50+ years
Series 1
48
CHAPTER 6
FINDINGS
6. FINDINGS
After going extensively through resources, news and other literature, I found the
following reasons as the fundamental pillars for the robust growth and expansion
of Cadbury in its efforts to garner larger share of the market pie
The Cadbury India team is all-Indian and has a deep understanding of local
market dynamics. The business is set in a way that highlights localization
across all facets – driving the belief that the only way to succeed in India is
by developing localized business models. For example, the company
tailored the chocolate formula in India to prevent melting in the country’s
open-air high frequency store environment.
Local management has set up systems to test and develop products from
the ground up with specialized interlinked cells that execute innovation and
market testing handin-hand. Cadbury India is known as a key product
innovator. Besides Dairy Milk, the entire Cadbury product portfolio in
India has been developed locally to suit Indian consumer tastes. Packaging,
marketing and distribution have all been tailored to local market conditions.
Royalty Structure:
50
Cadbury has reduced its dependence on cocoa, thus lowering its exposure
to volatile raw material prices as well as cutting costs. It appears that they
have subtly altered its recipe by using less of costlier cocoa and more of
milk and sugar. Cadbury's launch of Perk has also contributed significantly
in reducing the proportion of cocoa in the overall raw material mix.
Brand Building:
Since its inception, Cadbury in India has stayed ahead thanks to their constant
marketing initiatives, that have at all points in time understood the needs of and
opportunities in a changing nation but Nestle had stood firm in second position
resulting from their responsibilities and providing quality products. Amul an Indian
company has been able to create brand quality and thus selling their product
through their name.
The '60s was a decade which saw the launch of brands that are etched in the hearts
of generations of Indians - Tiffins, Nut Butterscotch, Caramels, Crackle, 5 Star and
Gems. It was a strategy that introduced consumers to a variety of tastes and
product forms leading to a rapid increase in chocolate consumption.
Cadbury's Eclairs was launched in 1972, at the then princely sum of 0.25p and was
an instant hit. It continues to be one of the biggest brands in the Cadbury portfolio
and offers the lowest price point at which consumers can experience the real taste
of chocolate. But as compared to other companies the price are very high because
of lack of competition.
In the years that followed, Cadbury invested in technology and made an impact
through innovative packaging. This decade experienced a continuous growth in
volumes as Cadbury launched a flurry of brands with different pack sizes, at
various price points. The now ubiquitous Sheet Metal Dispenser seen on cash
counters of thousands of shops for dispensing chocolates was an innovation that
helped brand the colour purple in the minds of the Indian consumer.
In the 90's Cadbury realized both the scope and the need to expand the market.
Hitherto perceived only as a children's product, Cadbury 'universalized' the
chocolate market. The multi-award winning advertising campaign - 'The Real Taste
of Life' - was launched, capturing the childlike spontaneity in every adult.
Moulded chocolate and éclairs also showed satisfactory growth. This has also
helped in improving the infrastructure and distribution reach of the company in
chocolate and confectionery segment.
Introducing new products:
Cadbury 5 Star with its “Energizing Bar” campaign targeted the youth, offering
them a mind and body charge. While pre-empting competition, Cadbury Perk - the
light chocolate snack - pushed chocolates into the wider area of snacking by
promising 'Thodi Si Pet Pooja Kabhi Bhi Kahin Bhi' (anytime, anywhere) and has
introduced new flavours like ‘Mint Hint’, ‘Mango Tango’, Very Strawberry’. It has
also introduced various new chocolates like Gollum and Fruits in recent years.
Constant diversification:
Faced with rapidly changing markets and increased competition, Cadbury launched
Truffle to hit the high ground of great tasting chocolate. This was followed by
Picnic in 1998, which with its unique, multi-ingredient construct promises to take
chocolates straight into the realm of snacks. With the introduction of Gollum and
Fruits Cadbury has taken the market by surprise.
Commitment of expansion:
With the launch of Trebor Googly, the tangy, fizzy candy, Cadbury took the market
by surprise and marked the entry of Trebor into the fast growing Indian sugar
confectionery market. The extension of Googly to a Mint flavour reinforces
Cadbury's commitment to establish the Trebor name as a strong player in the value
added sugar confectionery market.
Repositioning:
Cadburys has been repositioning its products for children to adults and for
celebrative occasions. A repositioning campaign was arranged for dairy milk that
showed adults doing unconventional things (like a lady breaking into a jig in the
middle of the overflowing Cricket (stadium) driving home the message that adults
could enjoy chocolate as well.
Information technology:
52
CHAPTER 7
SUGGESTION and
CONCLUSION
7. Suggestion and
Conclusion
Attitudes, beliefs, income level and spending. Understanding the consumer
demands he Indian Chocolate Industry is a unique mix with extreme
consumption patterns, and maintaining the quality will be essential. Pricing is the
key for Cadbury’s to make their product reach to every consumer houses. Right
pricing will make or break the product Success. There’s also an immense scope for
growth of chocolate industry in India, geographically as well as in the product
offering. So we think that bringing online sales(through Facebook) & increasing
the institutional sales(in unique way) would bring prosperity and increase the sales
of Cadbury’s as a whole again resulting in the goodwill of the company.
Cadbury has indeed emerged as the Market Leader in the Chocolate industry. And
as a leader embraces the characteristic of group preference over oneself, Cadbury
has practically applied this principle. The marketing strategies of Cadbury has not
only increased the share of Cadbury in the Market pie, but also it has increased the
very shape of the pie itself.
Cadbury hit the consumer at the place which is the key aspect of a consumer – his
mind. Rather than employing conventional or short cut sales promotion strategies,
Cadbury played the long run by aiming at the consumer mindset rather than the
consumer wallets. And indeed it paid off.
“Business has only two functions – Innovation & Marketing” And Cadbury has
personified the maxim in letter as well as in spirit
54
CHAPTER 8
LIMITATIONS and
RECOMMENDATIO
N
8. Limitations and
Recommendations
Maintain dominance in chocolate segment.
Medias such as the internet (Facebook, Google+ etc.) and the radio enable large
amount of cheap advertisement. Internet is a good place to sell goods, even
confectionary ones. Provides a new consumer group with access to Cadbury and
allows even larger sales due to a larger overall consumer group. (Business studies)
Many new players are trying to enter Indian market so it should formulate new
strategies so as not to lose market share.
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.
One new major product from International portfolio should be launch in India every
year.
FDI will bring in many new products and competitors so Cadbury will have to
maintain their strong market distribution channel so as not to lose market share.
They need to maintain high standards and should be careful that there product
remains sterile. And is not effected by insects.
They should bring many more flavours of Dairy Milk with focus on Health
conscious market segment i.e. low sugar chocolate bars
56
CHAPTER 9
BIBLIOGRAPHY
9. Bibliography
The following sources were referred to extensively during the entire course of this
research project
58
Jones, G. (1984). Multinational Chocolate: Cadbury Overseas. Business.
Review, H. B. (2010).
CHAPTER 10
ANNEXURE
60
10.Annexure
QUESTIONNAIRE
1. Name:
2. Age Group:
[ ] Below 10 years
[ ] 10-17 years
[ ] 18-25 years
[ ] 26-50 years
[ ] 50+ years
3.Gender:
[ ] Male
[ ] Female
4. Which name comes to your mind, when you hear the word ‘Chocolate’?
[ ] Yes [ ] No
7. If ‘Yes’, to question no.3, then which product of Cadbury do you like the most?
[ ] Self Consumption
[ ] Gift
[ ] Festivals
[ ] For Children
9. Name the Cadbury’s product which comes to your mind for purchase on the
following occasions:
i. Before a good work:
ii. To express feelings:
iii. To celebrate an occasion:
iv. As premium gift:
v. Casual consumption
10. On a scale of 1 to 5, 1 being not important and 5 being very important, when
purchasing chocolate, how important are following factors to you?
12345
Price
Taste
Packaging
Availability
Brand Ambassador
11. On a scale of 1 to 5, how would you rate Cadbury Dairy milk on following
attributes?
12345
Price
Taste
Packaging
Availability
87
Brand Ambassador
13. Do you believe that now people have become more health conscious that the
need
for chocolate has declined?
[ ] Yes
[ ] No
[ ] Maybe
14. Do you think sugar free Cadbury chocolates should be introduced to attract
health
conscious people?
[ ] Yes
[ ] No
[ ] Maybe
15. Do feel uncertain about the quality and hygiene of the products of Cadbury?
[ ] Yes
[ ] No
62
[ ] At times
16. If not Cadbury, then which company’s chocolate will you prefer?
[ ] Amul
[ ] Nestle
[ ] Others _______________
17. What do you think is the difference among Cadbury and its competitors
[ ] Taste
[ ] Quality
[ ] Packaging
[ ] Distribution
[ ] Promotion
[ ] Goodwill
[ ] Others ___________