Presented byAKANSHA

SHUKLA

ARCHITA

BANSAL

GEETIKA VERMA

PAYAL GUPTA

SHAHROZ KHAN

SHADAB RIAZ

“An Analytical Study of Chocolate Industry in India with Special Reference to Cadbury’s India”

The ancient Maya are believed to be the first people to make chocolate, over 2000 yrs ago. Cacao trees provided the beans used to make a bitter, spicy chocolate drink. Originally chocolate was consumed as drink because European did not like the bitter taste, they added sugar and cinnamon. Gradually chocolate was mixed with milk instead of water to produce a much lighter and smoother drink The industrialization of chocolate reduced the production costs and allow all levels of society to enjoy chocolate.In 1792, a chocolate industry was opened in berlin and in 1875 , the first milk chocolate was put on the market.

INTRODUCTION

Indian Chocolate Market India is the world's fastest growing market for chocolates. Registering 15% annual growth between 2008 and 2012. The Indian chocolate market is worth around Rs 5,562 crore. 400 Kgs of chocolate consumption in India per minutes. Low priced unit packs, increased distribution reach and new product

launches can be said to have fuelled this growth.

India chocolate industry will be

growing at the CAGR 23% by volume

between the years 2013-2018 and reach

at 3,41,609 Tons.

As per a recently published report, India’s chocolate market is expected to reach $ 3.2 billion by 2018 due to increasing gifting culture in the country and increase in the income bracket.

CATEGORIES OF CHOCOLATES

Commercial chocolates are available in the following forms:-Bars or molded chocolates (Dairy milk , Amulmilk chocolate, 5 star etc.) CountsPanned chocolates (gems)ÉclairsAssorted chocolates

Trends There are a number of trends within the chocolate industry that are driving growth; and product innovation in 2010 brought a 16% increase in new product releases over 2009. Premium and specialty items have shown strong growth over the long-term. Seasonal and boxed assorted chocolates have been experiencing the fastest growth, and sales are expected to expand 13% between 2010 and 2015. Holidays, birthdays, retirement parties and more, chocolate is a versatile gift for many occasions.Over the last several decades there has been increased understanding of what constitutes a healthy diet, and there has been a dramatic increase in sales of sugar free, reduced fat and reduced calorie offerings. Dark chocolate is known to lower both blood pressure and cholesterol, and has nearly 8 times the number of antioxidants as found in strawberries. A recent survey found that 35% of respondents believe dark chocolate to be healthier, and it shows: sales grew 9% in 2009 versus 3.6% for the chocolate industry as a whole.Fair-trade certified chocolate is another fast growing segment of the market, where consumers pay a premium to ensure goods are produced in an ethical manner.

KEY GROWTH FACTORSIndian confectionery industry constitutes the largest food processing segment in India. It can be categorized into sub sectors such as sugar based confectionery, chocolate based confectionery and gums.In India, chocolates are considered as indulgence foods which find its off-takes as a result of

impulse buyingAn analysis of the drivers explains the factors for growth of the market and includes tradition of gifting chocolates, increase in disposable income low per capita consumption of chocolates.Constant innovation towards making products accepted by consumers have resulted in leading brands diversifying into different variants such as wafers and light weighed chocolates India has woken up to the fad of chocolate being considered as a gift proposition. . Further, entry of major players in the country has allowed for easy availability of products to consumers.the attractive pricing of products which particularly suits the Indian scenario wherein consumers seek economical products. Government participation in this sector covers Prevention of Food Adulteration Act, certain policies of the Government and Food and Safety Standards Act. Which is also one of the key factor for growth.

Ever since the Cadbury is in India in 1947, Cadbury chocolates have ruled the hearts ofIndians with their fabulous taste. The company today employs nearly 2000 people across India.Its one of the oldest and strongest players in the Indian confectionary industry with an Estimated 68 per cent value share and 62 per cent volume share of the total chocolate market. Cadbury is known for its exceptional capabilities in product innovation,distribution and marketing.With brands like Dairy Milk, Gems, 5 Star, Bourn vita, Perk, Celebrations, Bytes, Choco Delight and Temptations, there is a Cadbury offering to suit all occasions and moods.

INTRODUCTION

Cadbury is a British multinational confectionery company owned by Mondelē’z International. It is the second largest confectionery brand in the world after Wrigley’s. Cadbury is headquartered in Uxbridge in Greater London and operates in more than fifty countries worldwide.Cadbury was established in Birmingham in 1824, by John Cadbury who sold tea, coffee and drinking chocolate

History of Cadbury

1824

John Cadbury began

selling tea, coffee, and

drinking chocolate

1824

1897

1897

The first Cadbury solid

chocolate bar is sold.

1905

1905

Dairy Milk brand appears

for the first time

1948

1948

Cadbury began its operations in

India by importing Chocolates

1969 1993

2009 2013

1969

Cadbury buys drink maker Schweppes

to become Cadbury-Schweppes

2009

Acquisition by Kraft

Foods: £11.5 billion

(US$18.9 billion) indicative

takeover bid for Cadbury

2012

The confectionery

business of Kraft

became Mondelēz

International, of which

Cadbury is a subsidiary.

2012-13

Cadbury India profit

slows to six year low

PAT growth 2.2% under

the new parent

Mondelez International.

2008

Cadbury Schweppes demerger

took with the drinks business

becoming Dr. Pepper Snapple

Group Inc.

1993

Cadbury opened the world's largest and

most advanced chilled warehouse in

Minworth, Birmingham

2012

9

2008

GUMS

Beverages

CANDy’s

Snacks

Chocolates

POPULAR PRODUCTS OF CADBURY

CADBURY MARKET SHARE

Its one of the oldest and strongest players in the Indian confectionary industry with an estimated 68 per cent value share and 62 % volume share of the total chocolate market.

Cadbury dominates the Indian chocolate market with above 65 – 70 % market share.

Besides, it has a 4% market share in the organized sugar confectionery market and a 15% market share in milk/malted foods segment.

In India, Cadbury has the largest market share anywhere in the world and has been the fastest growing

FMCG Company in the last three years with a compound annual growth rate of 12.5 per cent.

S.W.O.T Analysis of cadbury

Strength Topmost chocolate provider in

the world Brand loyalty Low cost of production due to

economic of scale Strong distribution network.

Weaknesses Lack of market penetration Relatively high Price Brand Limited variety of products Poor technology in India

compared to current international technologies

Opportunities India CAGR 2013-18 is 23% Population 1.27 Billion Bring efficiency in logistics and

distribution with the help of technology.

Introduction of foreign products in India.

Threats Faced a worm scandal In confectionery segment

Threats from company like Amul & Nestle.

Government Policies Rise in raw materials cost cocoa

beans, dairy products & Sugar.

VARIANTS OF CADBURY

COMPETITORS

Potential growth of Cadbury

Cadbury is sitting pretty in its flagship business of chocolates with a share of a little under 72%of that pie that’s valued at Rs 1400-1500crore.

Nearest competitor Nestle is a distant second with a share of 24.7%.

Even better , in the overall Rs 4000crore confectionery market, Cadbury is head and shoulders above the rest of the pack , with a share of 30.2%

CDM Product Life Cycle

19052014

Life Cycle Extension

17

THE 4P’S OF CADBURY

Product

Price Place

Promotion

1. PRODUCT. Cadbury made a strategic marketing decision to leverage the value of the Dairy milk brand(optimize the market potential of the brand Cadbury has a power house of lineup of products. Some in the chocolate business are Dairy milk, Bourneville , Five star, Perk, Cadbury Éclairs. In the biscuits segment is the premium OREA,In beverages there is bourn vita which again is one of the leaders in milk additives, Halls as a mouth freshener as well a remedy during cold is used across India .Dairy milk brand is endorsed across all variants. It has a “GLASS AND HALF FULL MILK” Logo with purplised background .It is targeting all the sections of society. Dairy milk is most widely sold packs are the 3.5gm, 12gm and 28gm packs . Smaller packs were introduced mainly to make dairy milk affordable to rural population and the lower and lower middle class of the urban areas.

2. PRICE

As the quality of the products is high, and the beverages and Orea requires constant marketing to be on top. Products like perk, five star and Eclairs give the taste of Cadbury even at lower price. Dairy milk is considered to be a premium brand of chocolates, it is also accepted across various target segments .Priced in high as well as low variants, the Cadbury diary milk has a position of gifting and hence is selling high volumes even at higher price.

3. PLACEThe distribution of Cadbury is fantastic and wide spread.

• Five company-owned

manufacturing facilities:

Thane

Induri (Pune)

Malanpur (Gwalior)

Bangalore

Baddi (Himachal Pradesh)

• 4 sales offices:

New Delhi

Mumbai

Kolkata

Chennai

• Corporate/Head office:

Mumbai

.

THESE FACTORIES CHURN OUT CLOSE

TO 8,000 TONNES OF CHOCOLATE ANNUALLY

4. PROMOTION

• The big factor that has pushed up CDM sales is the Amitabh Bachchan campaign.

• It helped restore consumers' faith in the quality of the product

Indians love sweets. Thus it is no surprise, that a smart marketer like Cadbury has a tag line “kuch meetha ho jae” which means that lets have something sweet.The promotions of Cadbury for each of its products is different.Cadbury is very strong with its hoardings , and standis' as well as

flex banners on shops, corners, hotels etc. thus , due to these activities, the brand recall is very high and people will always remember a Cadbury whenever they are buying a chocolate.

SOME TAG LINES BY CADBURYIN 1994-” ASLI SWAAD ZINDAGI KA”In 1998 –”Khaane Waalon ko khaane ka Bahana Chhayie”.In 2004, the `Kuch Meetha Ho Jaaye’ , `Pappu Pass Ho Gaya’ ,’Miss Palampur’ .In the year 2010, the `Shubh Aarambh’Other tag line “kuch meetha hai khana AajPhele tareekh hai”,” Meethe me kya hai”, “DilJo Keh Raha Hai Suno”

CADBURY WORM CONTROVERSY

On October 2003, just a month before Diwali, the food and drug administration commissioner received complaints about infestations in two bars of Cadbury Dairy milk.

In India, where Cadbury is synonymous with chocolate, the company’s reputation and credibility was under intense scrutiny . Sales volumes came down drastically in the first 10 weeks , which was the festive season. The challenge was to restore confidence in the key stake holders (consumers, trade and employees, particularly the sales team), and build back credibility for the corporate brand through the media that had questioned it.

In defense, Cadbury issued a statement that the infestation was not possible at the manufacturing stage and the poor storage at the retailers was the most likely cause of the reported case of worms, but the FDA didn’t buy that . it melted Cadbury’s sales by 30%.

As a remedy a focused and intense communications programs was implemented over the next six months to rebuild credibility and restore confidence among the key stakeholders . sales volumes climbed back to almost to precrisis levels after the launch of new packaging – a concrete step taken by the company to minimize the incidence of infestation.

SEGMENTATION

Segmenting of the markets will be based on the gender, income, zones or areas, consumer attitude and buying process and any other basis that is feasible in the chocolate market.

Cadbury’s product offerings are mostly based on the production capacity, pricing of the various packs, packaging designs, storage facilities at the outlets, occasional and situational demands, celebrity endorsements and many other factors.

TARGETTING

Targeting the market segments, will be considered as the next important step. Unless markets are targeted with the product offerings, very few will buy the product.

Therefore, Cadbury India has distinguished its product offerings to specific class of consumer groups. For example, Cadbury Temptations and Bourneville are meant for higher end consumer groups who are willing to pay more for the dark chocolates.

More recently, Cadbury has introduced SILK as a product offering and targets anyone who can’t resist chocolate. Cadbury SILK is only another product item in the CDM product line

POSITIONINGThe immediate step that would follow Targeting is Positioning

the product offerings in the minds of consumers.

Sponsoring the Quiz contests such as Bournvita Quiz contests hosted by Derek O‟Brien and Bournvita Confidence Academy shows.

Advertising with themes such as “Kuchh Khaas Hai,” “Pappu Pass Ho Gaya,” “Meetha Hai Khana , Aaj Pehli tarik hai ,” “ARREY” ad for Five Star Crunchy, “Pet Puja” ad for Perk, and Boonville's classic ad, ColourfulPandas for Gems ads and many others on the list.

Offering several variants in the existing product lines such as Silk, Fruit & Nuts in Dairy Milk and Five Star, Fruity Gems in Gems, Glucose energy Perk; Bournvita little champs for children and such other versions in the products

Launching new product ranges such as Bubbaloo bubble gum. Offering festival packs for Diwali , Raksha Bandhan and other special

occasions; Offering different packs at different prices for different purchase

situations and distributing them evenly. Constantly assuring consumers about the quality aspects in the products

and anything associated with it.

1905s 1930s

1960s1970s

1990s

2014

PACKAGING STYLE

ACHIEVEMENTS OF CADBURY Worlds No 1 Confectionery company World's No 2 Gums company. World's No 3 Beverage company. Cadbury Dairy Milk & Bourn vita have been declared a "Consumer Super

brand" for 2006-07 by Super brands India. Cadbury India has been ranked 5th in the FMCG sector, in a survey on

India's most respected companies by sector conducted by Business Worldmagazine in 2007.

Cadbury India has been ranked as the 7th Great Place to Work and the No. 1 FMCG company in India in 2008, by the Great Place to Work Institute.

Asian Marketing Effectiveness Awards 2008 for Bourn vita Folk/Fusioncampaign - GOLD award for the "Best Insights and Strategic Thinking" and SILVER award for the 'Most Effective Use of Advertising'.

CONCLUSION There is an immense scope for chocolate industry in India Indian Chocolate Industry is a unique mix with extreme consumption patterns,

attitudes, beliefs, income level and spending Understanding the consumer demands and maintaining the quality will be

essential and is the key to growth. So we think that bringing online sales(through online selling sites) & 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.

Pricing, quality , flavors and pack size are some of the important factors Economical distribution using proper supply chain management is necessity Brand loyalty should be maintained

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