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emerging trends

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CadburyCredits Ganesh Karthikeyan.K(09ad10) Mansurali.A(09ad23) Raghunath.V(09ad31) RajeevGandhi(09ad34) Swaminathan.K(09ad44)

Overview - The story of CHOCOLATE - Introduction - Company History - Cadbury International - Cadbury India - The Kraft Takeover - Suggestions

The story of CHOCOLATE First people who made chocolate were the Mayas and the Aztecs

They drank chocolate as a bitter and spicy beverage called xocoatl (bitter water) Chocolate played an important role in their social and religious life It symbolized life and fertility and was also used as medicine It was a drink for wealthy and important people (royalty, priests, etc.) Cocoa beans were also used as money

Introduction of Cadbury PLC Leading global confectionery company Outstanding portfolio of chocolate, gum and candybrands

Headquartered in Cadbury House, England Production in over 60 countries

Introduction of Cadbury PLC The firm has changed hands thrice from the time of itsinception as Cadbury brothers.Cadbury brothers Cadbury Scweppes PLC Cadbury PLC Cadbury PLC, Kraft

Until the Kraft takeover of Cadbury PLC, it remained tobe one of the oldest family managed business.

Cadbury InternationalCadburys global operations are in the followingcategories.

Cadbury InternationalCadburys global operations are in the followingregions.

Cadbury International

BIMABritain and Ireland: Chocolate + candy + gum.Revenue No. of employees Manufacturing sites

1,270m5600 8

Britain and Ireland is the largest business unit in the group. Cadbury enjoys a huge heritage quotient and is the market leader in this region. Last financial year the companys sales shot up by 12%

Global Competition

Cadbury India Entered INDIA in 1948 through imports.

No. of employees Manufacturing sites

2000 5 - Thane, Pune, Gwalior, Himachal Pradesh & Bangalore

Cadbury is the market leader in the confectionary segment in India.

Market Share in India

Critical success factors Extensive distribution network Creation of strong brand equity Customization of products Leveraging the India advantage

Market Entry Strategy Cadbury was one of the very first MNCs to identifypotential unserved market in India.

Reaped the Early mover Advantage. Entered as a wholly owned subsidiary Phenomenal success in India by employing uniquemarketing strategies with specified objectives.

Porters Five force Analysis1. Competitors Chocolate is an rivalry: Cadbury in India is facing cutthroat competition from no There impulse product been slowly eating into is almost Nestle, Nestle has the market bargaining power enjoyedof Cadbury. share all over the of consumer in world, hence it this industry, Threat from suppliers is not does not face high as thehowever there is distribution is threat from Threat of new entrants is great extensive has price substitutes high as the marketwith no single large supplier. sensitivity. fewer barriers to enter and players like Lindt and Suchard have not yet entered India

Case 1: Reinventing Cadbury:

Case 1: Reinventing Cadbury In the late 80s Cadbury changed the way Indians looked at Cadbury. They promoted a product meant for children and designed for them, to adults by saying to bring out the child in you The slogan Kya swad ye zindagi mein- The real taste of life They came up with a series of succesful ads.

Case 2: AB Germ free guy

Case 2: AB Germ free guy Cadbury to free itself off the germ worm controversy,introduced the pappu pass ho gaya campaign.

They chose the trust brand of India Mr.AmitabhBhachan as the brand ambassador.

The campaign revolved around any paltry reason wasgood enough to celebrate with cadbury.

PEST AnalysisPolitical: Since the budget range is decontrolled, no political effects are envisaged. Economical: Increasing per capita income resulting in higher disposable income. Growing middle class/urban population increase in demand. Low cost of production through economies of scale better penetration.

PEST AnalysisSocial: Increasing gifts culture increase in demand . Lower cholesterol than mithais (sweet meat) substitute demand. Dairy milk light variant serves calorie conscious

Technological: Will have to reinforce technology to international levels.

SWOT Analysis StrengthsBrand identification Heritage Supply chain and distribution Efficient Marketing Constant innovation in variants

WeaknessGerm worm controversy Product close to saturation in metroes Uncontrolled distribution to unorganized retail Poor technology

SWOT Analysis Threats Opportunities Untapped rural market Kraft provides wider portfolio Growing gift culture Growth of department stores Nestle Obesity Fragmented market Globalization opens the market.

4 P S OF CADBURY PRODUCT: Chocolate bar Made from real dark chocolate. Similar design worldwide. Contains more milk than any other chocolate bar. Available in 10.5g, 22g, 95g, 165g & other premium packs

PRODUCT LIST Diary milk Fruit n nut Roast almond Crackle 5-star Relish Picnic Perk Gems Nutties Caramel Googly Mr.pop

PRICE Price is same all over india. Competetive pricing. Due to price hike in raw material and labour cost company had not increased the cost of product but reduced the weight of product. Eg. 5 rs pack was of 13gm but now it is 10.5gm

PLACE Five company-owned manufacturing facilities Thane Induri (Pune) Malanpore (Gwalior) Bangalore Baddi (Himachalpradesh) Sales offices New Delhi Mumbai Kolkatta Chennai Headquarter Mumbai

PROMOTION Strong brands are very important in the chocolate confectionery market. Almost 80% of chocolate purchases are made on impulse. The media mix for the campaign comprises TV, outdoor, Internet and radio. Use of emotional appeals in advertising. Concentrated more on TV. Advertisement. The Real Taste of Life with the girl dancing on the cricket field The message: Dairy Milk is for enjoyment

Cntd... Campaign: kuch metha ho jaye . Target: to associate Cadbury with celebratory occasion. Cadbury appointed Amitabh Bachchan as its brand ambassador. The Big factor that has pushed up CDM sales is the Amitabh Bachchan campaign.

PACKAGING Aluminium foil Paper cover Plastic cover

PRESENT

ADVANTAGES OF PACKAGING Protect the product from physical damage or deterioration Display the product good graphic design and shape is important. Attracting customers Improved efficiency

Kraft takeover of CadburyKraft acquired Cadbury during feb 2010. Biding- $ 19.1 billion

Cadbury-KraftKraft had till date operated in India through an import model and had been selling only one brand Tang powder drink here through distributors. A couple of years back, it sold off its powdered soft drink concentrate plant in Hyderabad since low volume offtake meant the plant was not commercially viable in the long term

Benefits of Takeover (Global)Kraft will displace Mars Inc as the worlds biggest candy maker, according to Euromonitor data. It will create a company with about $50 billion in annual sales, adding Cadburys Crme Eggs and Trident gum to Krafts Oreo cookies. Cadbury-Kraft jointly accounts for 60% of the global absolute retail value gain for the packaged food market over the same period.

Benefits of Takeover The joint Kraft/Cadbury entity has become the 2nd largest packaged food conglomerate in Latin America. In Asia-Pacific, the company now joins the ranks of the top 10 packaged food companies across the region, moving from 17th to ninth position in 2009.

In IndiaThe deal would give Kraft Cadburys distribution network for its beverages, cheese, dairy products and snacks in addition to Cadburys chocolates. India, the confectionery sales in local currency terms is expected to increase by an average of 14.8% annually through to 2014, is without doubt one of the highlights of Kraft's new emerging market opportunity.

Kraft activitiesKraft is planning strategies to establish its name in the market. The first step is strengthen Cadbury's current product portfolio. Assesment of the brands, categories and products resonate the best with Indian consumer. The challenge is to think not like leaders but like challengers. A key element of the challenger's strategy will be targeting the lower end consumers -- that means, for starters, lower price packs.

Kraft ActivitiesKraft Foods Inc. is seeking to raise the profile of Cadbury products in China. The U.S. food giant ramps up investments in developing markets, particularly the Asia-Pacific region (Indonesia, India, China, Australia, New Zealand, HongKong, Philippines) The top ten power brands finalised by kraft for its markets are: Cadbury Dairy Milk chocolates, Halls lozenges and Trident gum, three Cadbury brands. They join Oreo cookies, Milka chocolate, Lacta chocolate, Jacobs coffee, Tang drink mix, Club Social/TUC crackers, Biskuat/Biscuits.

SuggestionsMaintain the same old recipe for chocolates. Host competitions at schools and other colleges and give free samples of cheese to gain good customer base. Could develop a new product altogether, infusing new blood. Kraft should take special care not in anyway to change the taste of Chocolate especially in the Europe market.

Cadbury WorldCadbury World, located in Birmingham, is a visitor attraction dedicated to telling the story of Cadbury and chocolate. As winner of the Large Visitor Attraction of Year award at the Heart of England Excellence in Tourism Awards, Cadbury World welcomes a vast number of customers, especially family groups, on a daily basis.

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