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1
INTRODUCTION
What Is A Product?
A good, idea, method, information, object or service created as a result of
a process and serves a need or satisfies a want. It has
a combination of tangible and intangible attributes (benefits, features, functions,
uses) that a seller offers a buyer for purchase. For example a seller of a
toothbrush not only offers the physical product but also the idea that
the consumer will be improving the health of their teeth.
A commercially distributed good that is
(1) tangible personal property,
(2) output or result of a fabrication, manufacturing, or production process, and
(3) passes through a distribution channel before being consumed or used.
A good or service that most closely meets the requirements of a
particular market and yields enough profit to justify its continued existence.
As long as cars are manufactured, companies such as Michelin
that produce tires fill the market need and continue to be profitable.
In marketing, a product is anything that can be offered to a market that might
satisfy a want or need. In retailing, products are called merchandise. In
manufacturing, products are bought as raw materials and sold as finished goods.
Commodities are usually raw materials such as metals and agricultural products,
but a commodity can also be anything widely available in the open market. In
project management, products are the formal definition of the project
deliverables that make up or contribute to delivering the objectives of the
project. In insurance, the policies are considered products offered for sale by the
insurance company that created the contract.
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In economics and commerce, products belong to a broader category of goods.
The economic meaning of product was first used by political economist Adam
Smith.
A related concept is that of a sub product, a secondary but useful result of a
production process.
Dangerous products, particularly physical ones,that cause injuries to consumers
or bystanders may be subject to product liability.
PRODUCT CLASSIFICATION
A product can be classified as building materials or intangible. A tangible
product is a physical object that can be perceived by touch such as a building,
vehicle, gadget, or clothing. An intangible product is a product that can only be
perceived indirectly such as an insurance policy.
Services can be broadly classified under intangible products which can be
durable or non durable. Services need high quality control, precision and
adaptability. The main factor about services as a type of product is that it will
not be uniform and will vary according to who is performing, where it is
performed and on whom/what it is being performed.
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NEW PRODUCT DEVELOPMENT STRATEGY
With a well-considered new product development (NPD) strategy, you can
avoid wasting time, money and business resources. An NPD strategy will help
you organise your product planning and research, capture your customers' views
and expectations, and accurately plan and resource your NPD project. Your
strategy will also help you avoid:
overestimating and misreading your target market
launching a poorly designed product, or a product that doesn't meet the needs
of your target customers
incorrectly pricing products
spending resources you don't have on higher-than-anticipated development
costs
exposing your business to risks and threats from unexpected competition.
There are several important steps you will need to plan into your NPD strategy.
Define your product
An accurate description of the product you are planning will help keep you and
your team focused and avoid NPD pitfalls such as developing too many
products at once, or running out of resources to develop the product.
Identify market needs
Successful NPD requires a thorough knowledge of your target market and its
needs and wants. A targeted, strategic and purposeful approach to NPD will
ensure your products fit your market. Ask yourself:
What is the target market for the product I am proposing?
What does that market need?
What is the benefit of my proposed new product?
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What are the market's frustrations of existing products of its type?
How will the product fit into the current market?
What sets this product apart from its competition?
Draw on your existing market research. You may need to undertake additional
research to test your new product proposal with your customers. For example,
you could set up focus groups or a customer survey.
Establish time frames
You need to allow adequate time to develop and implement your new products.
Your objectives for developing new products will inform your time frames and
your deadlines for implementation. Be thoughtful and realistic. Some objectives
might overlap but others will be mutually exclusive.
Your objective to race against your competition will require efficiency from
your team.
Your aim to achieve a specific launch date will be influenced by demand for
seasonal products and calendar events.
Your aim to be responsive to your customers' needs and demands will require
time for research to ensure you develop the right products at the right time.
Your objective to stick to business as usual and maintain other schedules will
affect the resources you make available for NPD.
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Identify key issues and approaches
There are many tasks involved in developing a product that is appropriate for
your customers. The nature of your business and your idea will determine how
many of these steps you need to take. You may be able to skip or duplicate
certain stages, or start some of them simultaneously. Key tasks include:
generating and screening ideas
developing and screening concepts
testing concepts
analysing market and business strategy
developing and market testing products
implementing and commercialising products.
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STEPS IN NEW PRODUCT DEVELOPMENT
Every entrepreneur knows that productivity is one of the key ingredients for
successful product development. One of the two key processes in Robert’s
Rules of Innovation is the NEW PRODUCT DEVELOPMENT PROCESS.
A formalized, NPD process – also referred to and best practice: the Stage Gate®
Process – is a must, from simple to sophisticated.
New product development
A 'new product' can be a product or a service. It can be the next revolutionary
computer chip, or a new holiday package put together by a travel agent. The
point is, it is new, so it is often risky.
This briefing will not help you generate the ideas for completely new products,
or recognise a winner when you see one. It focuses on the next stage - turning
an idea into a product, once you have decided to go ahead with it. It covers:
Reducing the risks as early as possible.
Setting a spec, a price and a schedule.
Running the project team and keeping costs under control.
The New Product Development process is often referred to as The Stage-Gate
innovation process, developed by Dr. Robert G. Cooper as a result of
comprehensive research on reasons why products succeed and why they fail.
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When teams collaborate in developing new innovations, having the following
eight ingredients mixed into your team’s new product developmental repertoire
will ensure that it’s overall marketability will happen relatively quick, and
accurately – making everyone productive across the board.
Step 1: Generating
Utilizing basic internal and external SWOT analyses, as well as current
marketing trends, one can distance themselves from the competition by
generating ideologies which take affordability, ROI, and widespread
distribution costs into account.
Lean, mean and scalable are the key points to keep in mind. During the NPD
process, keep the system nimble and use flexible discretion over which
activities are executed. You may want to develop multiple versions of your road
map scaled to suit different types and risk levels of projects.
Step 2: Screening The Idea
Wichita, possessing more aviation industry than most other states, is seeing
many new innovations stop with Step 2 – screening. Do you go/no go? Set
specific criteria for ideas that should be continued or dropped. Stick to the
agreed upon criteria so poor projects can be sent back to the idea-hopper early
on.
Because product development costs are being cut in areas like
Wichita, “prescreening product ideas,” means taking your Top 3 competitors’
new innovations into account, how much market share they’re chomping up,
what benefits end consumers could expect etc. An interesting industry fact:
Aviation industrialists will often compare growth with metals markets;
therefore, when Boeing is idle, never assume that all airplanes are grounded,
per se.
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Step 3: Testing The Concept
As Gaurav Akrani has said, “Concept testing is done after idea screening.” And
it is important to note, it is different from test marketing.
Aside from patent research, design due diligence, and other legalities involved
with new product development; knowing where the marketing messages will
work best is often the biggest part of testing the concept. Does the consumer
understand, need, or want the product or service?
Step 4: Business Analytics
During the New Product Development process, build a system of metrics to
monitor progress. Include input metrics, such as average time in each stage, as
well as output metrics that measure the value of launched products, percentage
of new product sales and other figures that provide valuable feedback. It is
important for an organization to be in agreement for these criteria and metrics.
Even if an idea doesn’t turn into product, keep it in the hopper because it can
prove to be a valuable asset for future products and a basis for learning and
growth.
Step 5: Beta / Marketability Tests
Arranging private tests groups, launching beta versions, and then forming test
panels after the product or products have been tested will provide you with
valuable information allowing last minute improvements and tweaks. Not to
mention helping to generate a small amount of buzz. WordPress is becoming
synonymous with beta testing, and it’s effective; Thousands of programmers
contribute code, millions test it, and finally even more download the completed
end-product.
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Step 6: Technicalities + Product Development
Provided the technical aspects can be perfected without alterations to post-beta
products, heading towards a smooth step 7 is imminent. According to Akrani, in
this step, “The production department will make plans to produce the product.
The marketing department will make plans to distribute the product. The
finance department will provide the finance for introducing the new product”.
In internet jargon, honing the technicalities after beta testing involves final
database preparations, estimation of server resources, and planning automated
logistics. Be sure to have your technicalities in line when moving forward.
Step 7: Commercialize
At this stage, your new product developments have gone mainstream,
consumers are purchasing your good or service, and technical support is
consistently monitoring progress. Keeping your distribution pipelines loaded
with products is an integral part of this process too, as one prefers not to give
physical (or perpetual) shelf space to competition. Refreshing advertisements
during this stage will keep your product’s name firmly supplanted into the
minds of those in the contemplation stages of purchase.
Step 8: Post Launch Review and Perfect Pricing
Review the NPD process efficiency and look for continues improvements. Most
new products are introduced with introductory pricing, in which final prices are
nailed down after consumers have ‘gotten in’. In this final stage, you’ll gauge
overall value relevant to COGS (cost of goods sold), making sure internal costs
aren’t overshadowing new product profits. You continuously differentiate
consumer needs as your products age, forecast profits and improve delivery
process whether physical, or digital, products are being perpetuated.
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CADBURY – COMPANY PROFILE
Cadbury is a British multinational confectionery company owned by Mondelēz
International. It is the second largest confectionery brand in the world after
Wrigley's. It is headquartered in Uxbridge, Greater London and operates in
more than fifty countries worldwide. It is famous for its Dairy Milk chocolate,
the Creme Egg and Roses selection box, and many other confectionery
products.
Cadbury was established in Birmingham, England in 1824, by John Cadbury
who sold tea, coffee and drinking chocolate. Cadbury developed the business
with his brother Benjamin, followed by his sons Richard and George. George
developed the Bournville estate, a model village designed to give the company's
workers improved living conditions. Dairy Milk chocolate, introduced in 1905,
used a higher proportion of milk within the recipe compared with rival products.
By 1914, the chocolate was the company's best-selling product.
Cadbury merged with J. S. Fry & Sons in 1919, and Schweppes in 1969.
Cadbury was a constant constituent of the FTSE 100 from the index's 1984
inception until the company was bought by Kraft Foods in 2010.
Type Cadbury UK Limited (Subsidiary)
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Industry Confectionery
Founded Birmingham, United Kingdom
(1824; 191 years ago)
Headquarters Uxbridge, London, United Kingdom
Key people Irene Rosenfeld
(Chairman and CEO)
Products See list of Cadbury products
Revenue £11,346,002,000 (2011)
Operating
income
£559,432,200 (2011)
Net income £447,545,760 (2011)
Number of
employees
71,657 (2008)[1]
Parent Mondelēz International
Slogan Working together to create brands people love
Website www.cadbury.co.uk
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Vision :- The Barrow Cadbury Trust’s vision is of a peaceful, equitable
society, free from discrimination and based on the principle of social
justice for all.
Mission :- The Barrow Cadbury Trust’s mission is to promote social
justice through grant making, research, influencing public opinion and
policy and supporting local communities.
Values
Promotion of social justice – the Trust aims to put fairness and equality at the
heart of all its work
Empowerment – the Trust seeks to uphold and extend the rights of marginalised
groups, to reflect the grassroots experience of local communities and to support
them in making their voices heard
Partnership – the Trust works in partnership with other grant-makers and with
stakeholders at international, national, regional and local levels
Local focus – the Trust values its historic relationship with Birmingham and the
West Midlands
Relationship with funded groups – the Trust aims to be an approachable, fair
and responsive grant-maker
Valuing learning – the Trust aims to be a learning organisation open to the
exchange of information and ideas, with its work grounded in a solid evidence
base
Innovation and Independence – as an independent grant-maker, the Trust is
alive to emerging needs and new ideas and ways of working and is willing to
take risks in pursuit of social justice
Quaker ethos – while there is no requirement for Trustees or staff to be
Quakers, and most are not, the Trust values its historical roots within the
Quaker ways of working and tradition of social and penal reform.
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Cross-cutting themes
The Trust has a particular interest in the following themes across its work:
Supporting the independence and diversity of the voluntary sector.
Addressing gender-based disadvantage.
Addressing disadvantage based on race and ethnicity.
Funding groups, projects and programmes in Birmingham and the Black
Country.
CADBURY SWOT
Strengths
Cadbury is the largest global confectionery supplier, with 9.9% of global
market share.
Strong manufacturing competence, established brand name and leader in
innovation.
Advantage that it is totally focused on chocolate, candy, chewing gum,
unique understanding of consumer in these segments.
Weaknesses
The company is dependent on the confectionery and beverage market,
whereas other competitors e.g. Nestle have a more diverse product
portfolio, where profits can be used to invest in other areas of the
business and R&D.
Other competitors have greater international experience - Cadbury has
traditionally been strong in Europe. New to the US, possible lack of
understanding of the new emerging markets compared to competitors.
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Threats
Worldwide - there is an increasingly demanding cost environment,
particularly for energy, transport, packaging and sugar. Global supply
chain in low cost locations.
Competitive pressures from other branded suppliers (national and global).
Aggressive price and promotion activity by competitors - possible price
wars in developed markets.
Social changes - Rising obesity and consumers obsession with calories
counting. Nutrition and healthier lifestyles affecting demand for core
Cadbury products.
Opportunities
New markets. Significant opportunities exist to expand into the emerging
markets of China, Russia, India, where populations are growing,
consumer wealth is increasing and demand for confectionery products is
increasing.
The confectionery market is characterized by a high degree of merger and
acquisition activity in recent years. Opportunities exist to increase share
through targeted acquisitions.
Key to survival within the FMCG market is increasing efficiency and
reducing costs. Cadbury Fuel for Growth and cost efficiency programmes
seek to bring cost savings by: 1) Moving production to low cost
countries, where raw materials and labour is cheaper ii) reduce internal
costs - supply chain efficiency, global sourcing and procurement, and
wise investment in R&D.
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Innovation is key driver. To respond to changes in consumer tastes and
preferences - healthier snacks with lower calories need to be developed.
R&D and product launches have led to sugar-free & center filled chewing
gum varieties and Cadbury premium indulgence treat. Low-fat, organic
and natural confectionery demand appears strong.
had an excellent double digit volume growth
"Bournvita" didn’t have major volume growth. (but of late it is
favourably growing)
Sugar confy. had static growth with larger share of "Eclairs" (with 33% price
increase effected.
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PRODUCT LIFE CYCLE
A concept that provides a way to trace the stages of a product’s acceptance,
from its introduction (birth) to its decline (death). The PLC of a product have 4
stages:-
1. The Introduction Stage
2. The Growth Stage
3. The Maturity Stage
4. The Decline Stage
These four stages of PLC can be understood with the help of the graph
given below:-
STAGE IN THE PRODUCT LIFE CYCLE
Cadbury Dairy Milk is in the maturity stage of the product Life cycle. It
currently has a market share of 70% in the chocolate market and is way ahead
of its competitors. There is a high degree of brand awareness. The colour purple
and the 'glass and half full' logo is amongst the most recognised logos and the
association of the two with Cadbury Dairy Milk is synonymous.
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STEPS TAKEN BY BRAND AT EACH STAGE-
AT A COMMUNICATION AND PRODUCT LEVEL
Introduction
Cadbury Dairy Milk advertising has always depicted a rich tapestry of human
emotions and relationships. In the 1980s, it was positioned as 'the perfect
expression of love', captured in memorable copy: 'sometimes Cadbury can say it
better than words'. During the early1990s, Cadbury Dairy Milk emphasised its
international identity, communicating that it was the 'real taste of chocolate'. In
1994 came the path-breaking 'real taste of life' campaign. The ad featuring a
woman running on the cricket field celebrating the victory is still strongly
etched in our mind even today. This campaign created a dramatic shift in the
way chocolates were perceived. Cadbury Dairy Milk has increasingly become
trapped as a reward or bribe for children and this campaign unshackled the
brand by re-positioning it to the 'free-child' in every adult. Cadbury Dairy Milk
redefined itself as the perfect expression of spontaneous, shared good feelings,
providing the 'real taste of life' experience. The strategy paid off: Brand
Cadbury grew by over 50% in sales volumes. (Super brands)
Growth
Then in 1998, the next stage of growth for the brand dealt with popularising
consumption in a social context, especially in more traditional settings like
weddings. With the campaign 'Khaanein waallon ko khaanein ka bahana
chahiye' featuring Cyrus Broacha, Cadbury Dairy Milk aimed to substantially
increase penetration levels. The campaign was launched in tandem with the
award winning 'Kuchh khaas hai...'campaign and the media strategy was to let
the two co-exist towards a common vision: 'A Cadbury in every pocket'. The
brand penetrated into smaller towns and sales volumes grew by 40%
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Crisis Management
The worm controversy resulted in Cadbury's brand image taking a beating. They
had to recall a batch of chocolates. Instead of taking any short term measures,
Cadbury used this opportunity to take action and rebuild the trust of people.
They launched a project 'Vishwas' which educated retailers and wholesalers on
storage and other aspects apart from educating consumers.
The other major step was to change the packaging. The company's repackaging
exercise, which used a combination of packaging technologies, was
unprecedented in the category. With the redesigned packaging in place, the
company decided to communicate the measures it had taken to safeguard
quality standards. To add credibility to its pitch, Cadbury took recourse to
Amitabh Bachchan's deep baritone. This was the first time that a celebrity was
used to endorse Cadbury Dairy Milk. The commercial did wonders to consumer
confidence.
A series of ads with Bachchan including "Pappu Paas ho Gaya" to "Miss
Palampur" brought back the lost credibility of the people. With Bachchan they
also launched their new positioning of "Kuch Meetha Ho Jaaye" bringing in the
tradition of celebrating a joyous occasion in India with sweets and now Cadbury
Dairy Milk in particular.
Maturity
The focus for a period shifted to taking the concept of "Kuch Meetha Ho Jaaye"
further. The "Pehli Tareekh Hai" campaigns talked about the importance of
having Dairy Milk and celebrating on getting your pay on pay-day. The ads had
a very retro-feel to it and did click with the audience. But, it is the recent string
of "Shubh Aarambh" ads that have brought back the old charm of Cadbury
Dairy Milk with its very interesting insight of mixing the traditional with the
new age.
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MARKETING STRATEGIES
Product strategy
We have the competitive advantage that is our quality. It is recognized
throughout the world and our product is a convenience product.
Promotion strategy
We can distinguish ourselves from the competitors on the following criteria:
Important: as we are the first one launching nuts coated with chocolate .and
due to winter season it will serve as a good product to our target market.
Communicable: yes the difference is communicable to the buyers through
our advertisements on TV and billboards.
Affordable: as the result of a survey the prices set are economical.
Positioning strategy
More for the same: As we are offering the same quality same taste at a
economy price.
Brand strategy
We will position our brand at its attributes that is its innovative ingredient
and good taste. And strong beliefs and values as Cadbury’s have many loyal
customers. The product name is Enticing Treats means a mouth watering
treat which is simply irresistible
The brand is licensed and is a international brand.
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POSITIONING
Cadbury find it easy to choose their Positioning Strategy. Cadbury is well
Known Company for its Superior Quality in certain segments and will go for
this position in new segment’s as there are enough buyers seeking quality now
day’s.
The positioning task Cadbury consists of three steps;
1. Identifying Possible Competitive Advantage
2. Choosing the Right Competitive Advantage
3. Selecting an overall Positioning Strategy
The Cadbury must effectively Communicate and deliver the Chosen Position
to the market.
Identifying Possible Competitive Advantage:
As Cadbury want to build profitable relationship with target
customer’s so Cadbury must understand Consumer’s needs better than
Competitor’s do and must deliver superior value.
Cadbury can position itself as Providing Superior Value. It will be a
competitive advantage for the Cadbury.
Cadbury position it’s product as offering the best quality and services.
But it must have to deliver the promised quality and services.
Cadbury can also differentiate the services that accompany the
product.
Cadbury can gain services differentiation through speedy, Convenient
and careful delivery.
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Choosing the Right Competitive Advantage
Cadbury has been lucky enough to discover several potential Competitive
advantages. Cadbury must carefully select the way in which it will
distinguish itself from competitors. A difference is the worth establishing to
the extent that it satisfies the following criteria.Important: The difference
delivers a highly valued benefit to the Target buyers. Superior: The
difference is superior to other ways that consumers might obtain the same
benefit. Communicable: the difference is Communicable and visible to the
buyers.
Selecting an overall Positioning Strategy
Cadbury would be selling its high quality products at lower prices to get the
Buyer’s Greater Value.
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MARKET MIX - CADBURY 4P'S
The market mix comprises of the 4 P’s which are product, price, place and
promotion. Those are all discussed below.
Product:
My product is a re-launch of Cadbury dairy milk. Cadbury dairy milk is made
from real chocolate. Its ingredients include cocoa butter and there is a glass and
half full cream dairy milk in every 200 grams of Cadbury dairy milk chocolate,
Cadbury buys 65 million litres of fresh milk each year to make Cadbury dairy
milk chocolate. Our product is a new product of Cadbury Chocolate. It is called
“Enticing Treats”. In this we are providing chocolate coated nuts with a low
calorie count. We have the competitive advantage that is our quality. It is
recognized throughout the world and our product is a convenience product.
The product that is discussed here is a chocolate bar which is manufactured with
different combinations including the 50% cocoa, 60% cocoa and 70% cocoa.
This means that the products can be consumed by people who are calories
conscious, has a taste for chocolate and has sweet tooth. The product is of high
quality and can be used for other direct consumption and baking purposes as
well. This helps in including people from various demographics in to the
superset of the consumers.
Price:
Price is an important element of the marketing mix. The price charged for a
chocolate bar can determine whether a consumer will buy it and the level of
sales achieved can determine whether or not Cadbury Schweppes will make a
profit. Price is also affected by factors such as the state of the economy, what
competitors are charging, the stage reached in the products life cycle and above
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all what price the market will bear. From the marketing point of view this is
what matters. Cadbury providing good quality and economical price.
The price range of this product is slightly higher that its peer products. The
reason behind it is that the product is of high quality and is healthy in nature.
Cadbury believes in attracting people towards its products for the brand image
that they have build for them self including the reliability, friendly nature and
the grandeur its products have by default.
Deeper product penetration will drive growth in India: Cadbury
In an interview with ET, Cadbury's HR and strategy head, V Chandramouli
discussed what the company plans for the Indian market, one where it already is
the market leader by a comfortable margin.
It claims to be one of the fastest growing consumer product companies in India.
But Cadbury India still feels there is a lot of scope for growth. As the company's
HR and strategy head, V Chandramouli feels that the next phase in product
distribution and penetration will drive the next phase of the company's growth.
Place
Cadbury products are produced at the chocolate factory in Bourneville in
Birmingham. After the chocolate is produced and has undergone all the quality
checks it is transported to the stockrooms. After this Cadbury sells its products
to shops that deal with beverages and confectionery e.g. corner shops, super
stores such as Iceland, Sainsbury, Kwik save, Tesco, Asda, Safeway and petrol
station. These businesses are usually visited by customers on a daily basis.
They then sell it to the general public. Cadbury produces chocolate for more
than 200 countries so that they have a chance to enjoy it as well and make
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profit. This gives them a wide range of consumers around the world. Cadbury
Schweppes therefore makes sure that the cultures of these different people are
kept. They can do this by producing products, which are eaten in that particular
country without upsetting religious or cultural practises.
The brand will be released in UK. These products will reach the hand of
retailers and other shopkeepers. These are places where people tend to shop the
most. People who come to malls and shops would either be there for serious
shopping or for having fun. Cadbury will appeal to both categories of people as
an instant rejuvenator and as a champion companion. These places help in a lot
of impulse purchase based on the tiredness and the instant craving for chocolate.
There will also be an option of direct purchase and home delivery in the case of
Cadburys when people are ready to make bulk purchase. This is for those
people who would like to resale or supply Cadburys in their partners and will
help in increasing the supplier base. The suppliers of Cadbury are extremely
loyal to Cadbury and keep its chocolates for sales on the counter where it gets
the maximum attention.
Promotion
We are promoting our new product with the help of advertisement on bill
boards and on television. Cadbury has a great brand image in the worldwide
market, they focused on present dominance in the chocolates market to be
maintained. Average sales to grow at least at 20% p.a. for the next 3 years,
volumes by at least 12%. 1 new major product to be launched every year. Sugar
conf Share in sales mix to be enhanced through value added niche products.
With control over costs and reduction in relative depreciation charge for the
year, steadily increase margins.
Web marketing, social marketing and bill boards will be the main ingredients
for the new product. Cadbury is highly active on face book and twitter and
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believes in giving opportunities to its users to speak. The idea is to appeal to
targets on a timely basis. It is targeting the middle age group initially and then
the kids. We plan to capture the market in segments on a timely basis in the case
of this product instead of capturing the whole market instantly. Cadbury Gems
another product in the Cadbury tree is also using the same strategy to attract
elders after being preferred by kids, there will be competitions for public
participation to enhance the perceived image of the product. The package will
be purple and yellow in colour darkening according to the cocoa content in the
product.
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CADBURY INDIA DESIGNS AND PACKAGING
FOR CHOCOLATE PRODUCTS
Mondelez International subsidiary Cadbury India has introduced new packaging
for its Dairy Milk products in chocolate, fruit and nut, crackle and roast almond
flavours.
Product shots have been replaced by imaginative expressions of each flavour
and brighter colours have been introduced.
Developed by the global Cadbury Dairy Milk team in co-operation with design
agency Pearlfisher, the new 'say what you see' packaging has already been
introduced in countries including the UK and Australia.
Cadbury India chocolate and media director Siddhartha Mukherjee said that the
last Cadbury Dairy Milk packaging change took place almost five years ago in
India, making it the right time to introduce the new global packaging.
"At Cadbury, we are always exploring avenues to create and maintain consumer
excitement," Mukherjee said.
Cadbury Fruit and Nut, Crackle and Roast Almond will also be undergoing a
recipe and mould change for the first time, in addition to the packaging change.
"Additionally, our consumer research shows that inclusions like nuts and
crispies are preference drivers in this category, thus making sense for us to
enhance our recipes in line with consumer needs," Mukherjee added.
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BRAND BUILDING OF CADBURY DAIRY MILK
The story of Cadbury Dairy Milk started way back in 1905 at Bournville, U.K.,
but the journey with chocolate lovers in India began in 1948.The pure taste of
Cadbury Dairy Milk is the taste most Indians crave for when they think of
Cadbury Dairy Milk.
The variants Fruit & Nut, Crackle and Roast Almond, combine the classic taste
of Cadbury Dairy Milk with a variety of ingredients and are very popular
amongst teens & adults. Recently, Cadbury Dairy Milk Desserts was launched,
specifically to cater to the urge for 'something sweet' after meals.
Cadbury Dairy Milk has exciting products on offer - Cadbury Dairy Milk
Wowie, chocolate with Disney characters embossed in it, and Cadbury Dairy
Milk 2 in 1, a delightful combination of milk chocolate and white chocolate.
Giving consumers an exciting reason to keep coming back into the fun filled
world of Cadbury.
Cadbury Dairy Milk has been the market leader in the chocolate category for
years. And has participated and been a part of every Indian's moments of
happiness, joy and celebration. Today, Cadbury Dairy Milk alone holds 30%
value share of the Indian chocolate market. In the early 90's, chocolates were
seen as 'meant for kids', usually a reward or a bribe for children. In the Mid 90's
the category was re-defined by the very popular `Real Taste of Life' campaign,
shifting the focus from `just for kids' to the `kid in all of us'. It appealed to the
child in every adult. And Cadbury Dairy Milk became the perfect expression of
spontaneity' and 'shared good feelings'.
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The 'Real Taste of Life' campaign had many memorable executions, which
people still fondly remember. However, the one with the "girl dancing on the
cricket field" has remained etched in everyone's memory, as the most
spontaneous & un-inhibited expression of happiness. This campaign went on to
be awarded 'The Campaign of the Century', in India at the Abby (Ad Club,
Mumbai) awards.
In the late 90's, to further expand the category, the focus shifted towards
widening chocolate consumption amongst the masses, through the 'Khanewalon
Ko Khane Ka Bahana Chahiye' campaign. This campaign built social
acceptance for chocolate consumption amongst adults, by showcasing collective
and shared moments.
More recently, the 'Kuch Meetha Ho Jaaye' campaign associated Cadbury Dairy
Milk with celebratory occasions and the phrase "Pappu Pass Ho Gaya" became
part of street language. It has been adopted by consumers and today is used
extensively to express joy in a moment of achievement / success. The
interactive campaign for "Pappu Pass Ho Gaya" bagged a Bronze Lion at the
prestigious Cannes Advertising Festival 2006 for 'Best use of internet and new
media'. The idea involved a tie-up with Reliance India Mobile service and
allowed students to check their exam results using their mobile service and
encouraged those who passed their examinations to celebrate with Cadbury
Dairy Milk.
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The 'Pappu Pass Ho Gaya' campaign also went on to win Silver for The Best
Integrated Marketing Campaign and Gold in the Consumer Products category at
the EFFIES 2006 (global benchmark for effective advertising campaigns)
awards.
CADBURY COLLABORATE AND WORK AS TEAMS TO CONVERT
PRODUCTS INTO BRANDS
30
THE CADBURY BRAND'S SIZE AND SCALE IN THE INDIA
We have a 33 per cent share in the overall confectionery market. This has three
categories- gum, candy and chocolate, so we have a leadership position here. In
the chocolate market, which is our heartland, we have over 70 per cent market
share. Apart from confectionery, we also have a strong presence in the health
drinks market especially in the North and West where we are market leaders.
But what is more important than the figures and plain data is the fact that we
have a sixty-year legacy in India. Consumers know the category of chocolates
by our brand name. In the last three years, the measure of our performance is
that in 2005, we were worth about Rs 875-crore and we ended 2008 at Rs 1587-
crore, close to doubling the business in these three years. Sales growth was 22
per cent, compounded growth rate over the past three years. Operating profit of
close to 28 per cent during the time period. We have got 20 per cent-plus
growth in the first nine months this year. In the last four years, we have doubled
our turnover.
So whatever benchmarking we have done vis-à-vis other consumer goods
companies, we are amongst the fastest growing consumer goods companies in
India.
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What has helped the company achieve such growth?
The reasons for our sustained growth have been that we have focused on power
brands, Cadbury dairy milk, Bournvita. We believe that if the company has to
grow at over 20 per cent, these key brands also have to follow suit.
We have ten power brands- six in chocolates. Cadbury Dairy Milk, gems, five
star, celebrations, bournville, two in candy- halls and Cadbury dairy milk éclairs
one in gum- bubaloo.
The second big focus is distribution. These are impulse buy products so wide
distribution makes a lot of difference. So reach or quality of availability makes a
huge difference. So clear focus there has helped us a great deal.
The third thing is focus on customer service and product freshness. The
question we constantly ask ourselves is- from the time the product is
manufactured, to the time the consumer eats it, how do we reduce this time?
How do we ensure that people consume fresher products?
The next is the fact that we have the best talent in the industry. We are
continuously scaling up on talent. We continue to hire, give regular increments.
We think that the best growth comes from the best people.
What is the sustainability focus of the company in India?
Cocoa farming is another sustainability area that we focus on, We introduced
cocoa farming in the country. We have a separate wing of people working to
ensure farmers grow cocoa and are remunerated well. We still import half our
cocoa from Africa and middle eastern countries.
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We have targeted to plant five million trees a year. Reason why it is good for
farmers is that cocoa does not require fresh land and grows as an intermediate
crop in coconut fields. It also helps increase soil fertility. So the farmer gets
double income from the same piece of land.
What is the road ahead for Cadbury in India?
Our overall business strategy in India is simple. We are focussing on growing
the overall market. Thanks to our size, our business also grows automatically.
Per capita consumption is very low 75 grams per person per year. But as the
economy grows and income levels rise, we will definitely see this rising. The
opportunity for growth is enormous here as chocolate consumption in the
developed world is 20 times India's.
So deeper penetration of the product will drive higher consumption and drive
growth.
What are the specific areas of focus for the company?
We are focussed on increasing value. To be present in different price points.
Second is distribution. Chocolate is highly perishable. Marketing investment
level and how do we make it relevant to Indians in a cultural context. So we
have promoted asa mithai, not as an alien concept. Innovation is the last aspect.
How do we grow the market through this. Bournville is choco for adults, as
people age, taste palette changes and we want a stronger flavour.
33
PORTERS FIVE FORCE
The Supplier Power
The operations of Cadbury are well supported by the suppliers whom they are in
contract with. The company shares an extremely good connection with the
suppliers and are well appreciated for that. Since the company and the suppliers
work on a mutual basis, it can be said that the company and the suppliers have
equal amount of power on each other.
Barriers to Entry
Cadbury as a company is well known throughout the world and hence it has
trust of many. There are opportunities for competitors to rise. But it is unusual
for them to rise up to the level of the Cadbury in terms of its acceptability,
quality and affordable prices. The threat from new entrants is lower in the case
of Cadbury.
Power of the buyers
The buyers are highly health conscious now and tend to demand health
products. But irrespective of this people tend to be sensitive to prices and switch
to products that are offered at a cheaper cost by the competitors. This in turn
influences Cadbury to reduce the cost of the chocolates offered. The bargaining
power of the customers is high
Threat from the Competitors
There are many competitors for Cadbury and they tend to capture the same
target market as that of Cadbury. They do this on the basis of changing the taste
and customers requirements. The companies are now involved in making
products that are extremely innovative and are hard to be worked with.
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Threats for substitutes
Brand image that is created by Cadburys is extremely strong and customers are
attracted to the brand for its chocolates. There are sweets of different kinds but
chocolate still remains the most preferred sweet. But the existence of the other
substitutes in the market cannot be underestimated.
All the mentioned issues above can be solved with the help of proper marketing
skills which is also the necessity of the hour where Cadbury is concerned.
Segmentation criteria
There was no segmentation in the case of Cadbury initially. But for the time
time being it seems best for Cadbury to adapt a heterogeneous segment and to
concentrate on the basis of the reasons why they buy chocolates. Market
segmentation can be defined into many ways and some of them are
demographic variables. Other factors that influence their decisions are lifestyle
of consumers, the occasions of the purchase and the benefits that people would
get out of buying that particular product. All these factors are to be considered
when a product is being made by Cadbury.
Segmentation is also done by Cadbury on the basis of behavioural
segmentation. Following are the segments that are used by Cadbury.
Break segment: products that can be snatched and consumed when there is a
break from work of office or studies. These products can be consumed in a daily
basis. Some of the examples of these products are Cadbury’s TimeOut and
snack range.
Impulse Segment: the products in this category can be purchased impulsively
for instant consumption. These products are most advertised and are made
35
available everywhere. Some of the examples for these products include Mori,
Twirl, Crunchie, Starbar, Diarymilk and Fuse.
Take home segment: the products in these segments can be taken home and
used at any further point of time and people tend to purchase it when the need
arises
Gift segment: This is a segment where people purchase boxes of chocolate and
other products for giving away gifts during special occasions and others
festivals.
Demographical segmentation is also used by Cadbury. Age is a dominant factor
used for segmentation in the case of Cadbury. The target segment for Cadbury
is from 5-60. But even kids lesser than the age of five tends to consume
Cadbury’s. One of the reasons why people in this age group are targeted is
because of the nature of the product that is sold by them. Chocolates are equally
liked by people of every age.
Among this target segment they further divides the targeted segment on the
basis of the occasions that they tend to consume chocolates. This will further
include everyone in their segment producing variety of chocolates as per their
requirements. They also try and include obese people in their target and bring
out specialised products for them. Products are manufactured on the basis of the
perceived preferences.
An example for a product that is made available for kids are milk chocolate
covered with nuts. The kids are further attracted towards the brand for the
superheroes that are used for wrapping and as gifts in the packages. Brown
chocolate and nuts with lower calories are provided for middle age group
because of their diet conscious nature and old age targets are provided with
white chocolate and nuts.
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Targeting Strategy
The targeted segment can be divided into three groups as far as Cadbury is
concerned and they are 5-10, 11-20 and 21-60. The segmentation strategy used
here is demographical segmentation and the major target chosen here primarily
is the segment from 21-60. One of the major reasons for this target is the
number of people from this target range are numerous and independent. They
can make impulse decisions and purchase the chocolate and not ask for
permission from their parents. The usage of advertisements will be
differentiated in nature depicting models and contexts that people in this age
group are bound to be involved in. The target segment concentrated on will be
in age limit of 21-60. But the consumption of these chocolates will not be
limited to this segment and others are also encouraged to consume the chocolate
bar. This segment is chosen on the basis of the ingredients of the chocolate
products that tend to be more appealing to 21-60 age groups.
37
INFLUENCE OF BUYER BEHAVIOUR ON MARKETING
STRATEGIES
Buyer behaviour is highly dependent on many issues including the internal and
the external factors. There are influencing factors behind every purchase made
by the customers and these influencing factors can be used positively by the
marketers in increasing the attractiveness of their products. Analysing these
behaviours is what helps Cadbury to design the best of positioning strategies to
attract more customers to the brand. Some of the factors that have higher had in
the buyer behaviour now are online feedback on the products, friends and
families opinion on the product, the cost of the product and the requirement for
consuming or not consuming the product. The range of cultural factors, social
factors, personal factors and psychological factors impact the decisions that are
taken by buyers. It is also highly critical for the marketer to decode these
influences segment and target them accordingly to enhance the chances of them
making a favourable decision.
Example: some of the qualities that are portrayed by the brand personality of
Cadburys are fun loving, down to earth, reliable, confident, indulgent and
friendly. Cadbury tends to appeal to its users on the basis of buyers behaviours
and their personality. There always tend to be synchronisation between the
brand personality and the buyer personality. Here are some of the buyer
behaviours personified and targeted by Cadbury
Cadburys Diary milk has the personality of the rebel leader and appeals to
youthful exuberance and rebelliousness
5 Star depicts a male personality and reliability, and is the champion
companion
Perk has personality of the girl next door and the main factors of its
personality includes warm, perky, naughty and accessible.
38
QUALITY ASSURANCE OF CADBURY
1. Market high quality, superior value products that consistently meet our
specifications and comply with local regulatory requirements, while
continuously improving and exceeding our consumers’ expectations.
2. Guarantee that our customers and consumers come first by actively listening
and understanding their quality and value expectations at the points of purchase
and consumption.
3. Ensure that any representation of our company image, including our products
and trademarks, meet approved standards, reinforce our commitment to quality
and safeguard the reputation of Cadbury.
4. Maintain a “right first time” culture that consistently embraces quality and
food safety, where everyone understands their responsibilities and
accountabilities.
5. Operate audited quality management systems that continually improve
processes to deliver this policy and our standards.
6. Assign clear management accountability for setting and meeting measurable
goals and targets for quality and food safety.
7. Work with our supply chain and business partners to assure compliance with
our quality policy and systems, ensuring quality throughout our supply chain.
8. Place continuous improvement at the heart of our performance enabling us to
deliver superior products and service to our consumers and customers.
9. Create a passion for quality where success and achievement are
communicated, recognised and celebrated.
39
NEW PRODUCT DEVELOPMENT – SILK
Cadbury India, a part of Mondelēz International, announced the launch of a new
TVC campaign for the all-new softer, smoother and silkier Cadbury Dairy Milk
Silk. Revolving around the theme of 'indulgence', the film effectively captures
the immersive joy of consuming a bar of Cadbury Dairy Milk Silk. This is
showcased through three young people who are shown taking hearty bites of the
new silkier chocolate and also scooping it with their fingers, enjoying the softer,
smoother and creamier sensation.
Speaking about the campaign, Chandramouli Venkatesan Director, India
Snacking and Asia Pacific and Developing Markets- Chocolate Lead, Cadbury
India said, "Silk has been a great success story for us ever since its launch. The
renovation of Silk is in line with our efforts towards providing an even more
superior chocolate eating experience in India. The new Silk TVC showcases
characters being completely immersed in the experience of consuming the new
Cadbury Dairy Milk Silk. The new product has been improved to deliver greater
softness and creaminess, while retaining the signature Silk taste, to make it the
best chocolate in India."
He further adds, "This re-launch is supported with heavy marketing investments
including outdoor, digital, on-ground engagement and differentiated POB
execution."
Manoj Shetty, Creative Director, Ogilvy India, who developed the TVC
Campaign said, "The new Cadbury Dairy Milk Silk TVC campaign is created to
cater to the fast evolving consumer tastes and trends and their compulsive need
to indulge and pamper themselves. The characters in the TVC aptly depict that
the new Cadbury Silk is softer, silkier and smoother"
40
CADBURY GLOW TO MAKE INDIA DEBUT
In what is a clear signal of the importance of India in snacks and beverage
major Mondelez International's scheme of things, the latter will be unveiling its
new chocolate gifting brand Cadbury Glow in the country next month.
This is the first market where the newest entrant to Mondelez's global chocolate
portfolio will be launched, Siddharth Mukherjee, director, chocolate category &
media, Mondelez India Foods Ltd, said in an exclusive conversation with
Business Standard.
Other markets will follow post the India launch, which will involve targeting
high-end retail outlets, hotels, airports, departmental stores in cities such as
Delhi, Mumbai, Pune, Ahmedabad, Bangalore, Hyderabad, Chennai, Ludhiana,
Chandigarh and Kolkata, Mukherjee said.
This is the third chocolate gifting brand in Mondelez's India portfolio
after Cadbury Celebrations and Toblerone and is positioned as a luxury product
with a price point of Rs 400 for a 16-unit pack and Rs 600 for a 24-unit pack,
Mukherjee said. Cadbury Celebrations one of Mondelez's chocolate gifting
brands is a mass-market product available from Rs 50 to Rs 150 for different
stock keeping units, while Toblerone is a premium chocolate gifting option that
is priced at Rs 65 per pack going upto Rs 400.
Celebrations also has a premium gifting range called Rich Dry Fruit Collection
that is available for Rs 250 going upto Rs 575 per pack.
"Cadbury Glow is an international product, which took two years to develop
and involved inputs from different centres and three intermational design
agencies. We are importing the product in bulk (from Bratislava in Slovakia
where it is made) and repacking the product in India. We will look at
manufacturing Cadbury Glow in India in the future," Mukherjee says.
41
NEW PRODUCT DEVELOPMENT
CADBURY BUBBLY
The chocolate was literally bursting out of its package.
Cadbury’s Bubbly is quite delicious. It’s the same smooth flavour that you
would expect from Cadbury’s Silk — with the added twist of bubbles
(completely non-flavour altering). It is milk chocolate, so it is on the sweeter,
milkier side. The bubbles simply make it a little bigger to bite into, a little airier
when you are chewing. When you hold it in your hand, you can actually feel the
bubbles bursting. It’s quite cute.
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Cadbury’s Silk Bubbly Shape & Packaging
The shape is what got to me: lava-like flowing bubbly chocolate! It really looks
big and inflated. The packaging, like most Cadbury’s products, is great.
Priced at Rs 70 for a 50 gram bar, Cadbury’s Bubbly is relatively
expensive. Especially since Cadbury’s Silk costs Rs 57 for 60 gram pack. So
not are you getting less chocolate, you are paying more — for air!!!
Availability of Cadbury’s Silk Bubbly Chocolate
Cadbury’s Silk Bubbly is available in your supermarket. Cadbury’s Silk can be
ordered online on Amazon.in: Cadbury Dairy Milk, Silk Chocolate, Pouch,
160g
USER REVIEWS: Cadbury Dairy Milk Bubbly
Cadbury Dairy Milk have made their classic Bubbly chocolate even more
bubbly and more flavour-some with the new-look aery chocolate snack.
There are three delicious flavours with Milk Chocolate, Strawberry and Mint
and instead of the usual blocks of chocolate the insides are covered in yummy
chocolate, in a bubble design.
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CONCLUSION
Cadbury Dairy Milk has adapted itself to the Indian market quite impressively.
From making a sweet eating nation to switch to chocolates to becoming the
market leader, Cadbury Dairy Milk has done it all because of the emotional
connect it established with the consumers. Its communication also always
focused on the emotional aspects and feelings of life apart from spontaneity. Its
communication has always showcased its values and personality. In my opinion,
the 'Kuch Meetha Ho Jaaye" concept is a goldmine which can be used in a
variety of ways in a country like India."
It is important to be extremely careful about the marketing strategy where
umbrella branding is concerned. Marketing strategy has in it to make or fail a
product and hence it is extremely necessary to have an innovative marketing
strategy in hand. Marketing acts as a link between the product and the consumer
and hence it should be given ultimate preference along with the quality of the
product. Cadbury has also managed to become this famous because of the
quality of their products and the marketing strategies adapted by them.
The reasons for our sustained growth have been that we have focused on power
brands, Cadbury dairy milk, Bournvita. We believe that if the company has to
grow at over 20 per cent, these key brands also have to follow suit.
44
BIBLIOGRAPHY
https://en.wikipedia.org/wiki/Product_(business)
http://www.innovationexcellence.com/blog/2013/05/27/8-step-process-
perfects-new-product-development/#sthash.tU3a8vwr.dpuf
http://www.barrowcadbury.org.uk/vision/
http://www.ukessays.com/essays/marketing/product-life-cycle-of-
cadbury-dairy-milk-marketing-essay.php#ixzz3oHgwWaPO
https://www.cadbury.co.uk/