Phase - 1
BRAND DOSSIER ON “CADBURY DAIRY MILK”
Submitted to Prof. Srinivasan Govindrajan
Presented by:
Santosh Koppada
Rohit Kumar
Sumit Kumar
Madhumita Ghosh
Brand Dossier on Cadbury
Phase One – Literature Review
CONTENTS
1. Early history of the brand
2. Cadbury Dairy Milk’s evolution over time
3. Initial positioning and subsequent repositioning
4. Advertising
5. Sales promotion and segmentation strategy followed by the brand
6. Analysis of product and generic competition to the brand
7. Strategies adopted over time by the brand to tackle competition or prime
market expansion
8. Distribution strategy followed by the brand
9. Summary regarding the future directions for the brand
10. References Used
Brand Dossier on Cadbury
Phase One – Literature Review
Early History of the Brand and Its Evolution over Time
1824–1900: Early history
In 1824, John Cadbury began selling tea, coffee, and drinking chocolate, which he produced
himself, at Bull Street in Birmingham, England. He later moved into the production of a
variety of cocoa and drinking chocolates, made in a factory in Bridge Street and sold mainly
to the wealthy because of the high cost of production. John Cadbury became a partner with
his brother Benjamin and the company they formed was called 'The Cadbury Brothers of
Birmingham'.
The brothers opened an office, in London and in 1854 they received the Royal Warrant as
manufacturers of chocolate and cocoa to Queen Victoria. In the 1850s the industry received
a much needed boost, with the reduction in the high import taxes on cocoa, allowing
chocolate to be more affordable to everybody.
Due to the popularity, of a new expanded product line, including the "Cadbury's Cocoa
Essence", the company decided not to sell as much tea in 1873. Master confectioner
Frederic Kinchelman was appointed to share his recipe and production secrets with the
Cadbury brothers, which led to an assortment of chocolate covered products.
Taking over the business in 1861, John Cadbury's sons Richard and George decided in 1878
that they needed new premises. Better transport access for milk that was inward shipped
by canal, and cocoa that was brought in by rail from London, Southampton and Liverpool
docks was taken into consideration. With the development of the Birmingham West
Suburban Railway along the path of the Worcester and Birmingham Canal, they acquired the
Bournbrook estate, comprising 14.5 acres (5.9 ha) of countryside 5 miles (8.0 km) south of
the outskirts of Birmingham. Located next Stirchley Road railway station, which itself was
opposite the canal; they renamed the estate Bournville and opened the Bournville factory
the following year.
In 1893, George Cadbury bought 120 acres (49 ha) of land close to the works and planned,
at his own expense, a model village which would 'alleviate the evils of modern more
cramped living conditions'. By 1900 the estate included 314 cottages and houses set on 330
acres (130 ha) of land. As the Cadbury family were Quakers there were no pubs in the
estate; in fact, it was their Quaker beliefs that first led them to sell tea, coffee and cocoa as
alternatives to alcohol.
1900–2007
Brand Dossier on Cadbury
Phase One – Literature Review
In 1905, Cadbury launched its Dairy Milk bar, with a higher proportion of milk than previous
chocolate bars, and it became the company's best selling product by 1914. Fruit and Nut
was introduced as part of the Dairy Milk line in 1928, soon followed by Whole Nut in 1933.
By this point, Cadbury was the brand leader in the United Kingdom. These were
accompanied by several other products: Flake (1920), Cream-filled
eggs (1923), Crunchie (1929) (Crunchie was originally launched under the Fry's name but
later adopted by Cadbury's) and Roses (1938).
Cadbury's Milk Tray was first produced in 1915 and continued in production throughout the
remainder of the First World War. More than 2,000 of Cadbury's male employees joined the
Armed Forces and to support the war effort, Cadbury provided clothing, books and
chocolate to soldiers. After the war, the Bournville factory was redeveloped and mass
production began in earnest. In 1918, Cadbury opened their first overseas factory
in Hobart, Tasmania and in 1919 undertook a merger with J. S. Fry & Sons, another
chocolate manufacturer, resulting in the integration of well-known brands such as Fry's
Chocolate Cream and Fry's Turkish Delight.
During World War II, parts of the Bournville factory were turned over to war work,
producing milling machines and seats for fighter aircraft. Workers ploughed football fields to
plant crops. As chocolate was regarded as an essential food, it was placed under
government supervision for the entire war. The wartime rationing of chocolate ended in
1950, and normal production resumed. Cadbury subsequently built new factories and had
an increasing demand for their products.
Schweppes merger (1969)
The Cadbury Schweppes logo used until the demerger in 2008
Cadbury merged with drinks company Schweppes to form Cadbury Schweppes in 1969.
Cadbury Schweppes went on to acquire Sunkist, Canada Dry, Typhoo Tea and more. In the
US, Schweppes Beverages was created and the manufacture of Cadbury confectionery
brands was licensed to The Hershey Company.
Snapple, Mistic and Stewart's (formerly Cable Car Beverage) were sold by Triarc to Cadbury
Schweppes in 2000 for $1.45 billion. In October of that same year, Cadbury Schweppes
purchased Royal Crown from Triarc.
Schweppes demerger
In March 2007, it was revealed that Cadbury Schweppes was planning to split its business
into two separate entities: one focusing on its main chocolate and confectionery market;
the other on its US drinks business. The demerger took effect on 2 May 2008, with the
drinks business becoming Dr. Pepper Snapple Group Inc. In December 2008 it was
announced that Cadbury was to sell its Australian beverage unit to Asahi Breweries.
2003 Name rebrand
In 2003, Cadbury dropped the’s’ from its name and renamed the brand to Cadbury. The
reason behind this change was because the company found that it was a much more suited,
rounded name than the previous "Cadbury's". This change was officially announced on the
19th of December, 2002.
Brand Dossier on Cadbury
Phase One – Literature Review
2007–2010
In October 2007, Cadbury announced the closure of the Somerdale Factory, Keynsham,
formerly part of Fry's. Between 500 and 700 jobs were affected by this change. Production
transferred to other plants in England and Poland.
In 2008 Monkhill Confectionery, the Own Label trading division of Cadbury Trebor Bassett
was sold to Tangerine Confectionery for £58 million cash. This sale included factories at
Pontefract, Cleckheaton and York and a distribution centre near Chesterfield, and the
transfer of around 800 employees.
In mid-2009 Cadbury replaced some of the cocoa butter in their non-UK chocolate products
with palm oil. Despite stating this was a response to consumer demand to improve taste
and texture, there was no "new improved recipe" claim placed on New Zealand labels.
Consumer backlash was significant from environmentalists and chocolate lovers. By August
2009, the company announced that it was reverting to the use of cocoa butter in New
Zealand. In addition, they would source cocoa beans through Fair Trade channels. In January
2010 prospective buyer Kraft pledged to honour Cadbury's commitment.
Acquisition by Kraft Foods
On 7 September 2009 Kraft Foods made a £10.2 billion (US$16.2 billion) indicative takeover
bid for Cadbury. The offer was rejected, with Cadbury stating that it undervalued the
company. Kraft launched a formal, hostile bid for Cadbury valuing the firm at £9.8 billion on
9 November 2009. Business Secretary Peter Mandelson warned Kraft not to try to "make a
quick buck" from the acquisition of Cadbury.
On 19 January 2010, it was announced that Cadbury and Kraft Foods had reached a deal and
that Kraft would purchase Cadbury for £8.40 per share, valuing Cadbury at £11.5bn
(US$18.9bn). Kraft, which issued a statement stating that the deal will create a "global
confectionery leader", had to borrow £7 billion (US$11.5bn) in order to finance the
takeover.
The Hershey Company, based in Pennsylvania, manufactures and distributes Cadburybranded chocolate (but not its other confectionery) in the United States and has been
reported to share Cadbury's "ethos". Hershey had expressed an interest in buying Cadbury
because it would broaden its access to faster-growing international markets. But on 22
January 2010, Hershey announced that it would not counter Kraft's final offer.
The acquisition of Cadbury faced widespread disapproval from the British public, as well as
groups and organisations including trade union Unite, who fought against the acquisition of
the company which, according to Prime Minister Gordon Brown, was very important to
the British economy. Unite estimated that a takeover by Kraft could put 30,000 jobs "at
risk", and UK shareholders protested over the mergers and acquisitions advisory fees
charged by banks. Cadbury's M&A advisers were UBS, Goldman Sachs and Morgan
Stanley. Controversially, RBS, a bank 84% owned by the United Kingdom Government,
funded the Kraft takeover.
On 2 February 2010, Kraft secured over 71% of Cadbury's shares thus finalising the
deal. Kraft had needed to reach 75% of the shares in order to be able to delist Cadbury from
the stock market and fully integrate it as part of Kraft. This was achieved on 5 February
2010, and the company announced that Cadbury shares would be de-listed on 8 March
2010.
Brand Dossier on Cadbury
Phase One – Literature Review
On 3 February 2010, the Chairman Roger Carr, chief executive Todd Stitzer and chief
financial officer Andrew Bonfield all announced their resignations. Stitzer had worked at the
company for 27 years.
On 9 February 2010, Kraft announced that they were planning to close the Somerdale
Factory, Keynsham, with the loss of 400 jobs. The management explained that existing plans
to move production to Poland were too advanced to be realistically reversed, though
assurances had been given regarding sustaining the plant. Staff at Keynsham criticised this
move, suggesting that they felt betrayed and as if they have been "sacked twice". On 22
April 2010, Phil Rumbol, the man behind the famous Gorilla advertisement, announced his
plans to leave the Cadbury Company in July following Kraft's takeover.
In June 2010 the Polish division, Cadbury-Wedel, was sold to Lotte of Korea. The European
Commission made the sale a condition of the Kraft takeover. As part of the deal Kraft will
keep the Cadbury, Hall's and other brands along with two plants in Skarbimierz. Lotte will
take over the plant in Warsaw along with the E Wedel brand.
On 4 August 2011, Kraft Foods announced they would be splitting into two companies
beginning on 1 October 2012. The confectionery business of Kraft became Mondelēz
International, of which Cadbury is a subsidiary.
History of Cadbury Dairy Milk in INDIA
Cadbury began its operations in 1948 by importing chocolates and then re-packing them
before distribution in the Indian market.
1948
The Company was incorporated on 19th July, as a private limited company under the name
of Cadbury-Fry (India) Private Limited and commence business soon thereafter.
Manufacturing facilities were set up gradually.
1964
The Company undertook at its own cost and responsibility the development of cocoa
growing in the country. A specialist cocoa advisory service was created. A cocoa research
centre was also created together with seeding nurseries and distribution centres.
Through its subsidiary, Induri Farm Ltd., the Company had set up facilities near Pune to
breed cattle that would give improved yield of milk at economic feeding costs.
1967
Cadbury introduced the `Five Star and Gems' chocolates in 1967 and 1968 respectively.
1981
The Company received a certificate to manufacture 2,200 tonnes of chocolates at Indore.
1982
On 17th December, the name of the Company was changed from Cadbury India Ltd., to
Hindustan Cocoa Products Ltd., consequent to 60% of its shares being held by the Indian
public.
Brand Dossier on Cadbury
Phase One – Literature Review
1984
The company launched its dairy milk chocolate, which has now become the flagship brand
of the company.
1995
`Perk' was launched from its Malanpur plant.
1997
Cadbury India Ltd has launched Truffle - flavoured soft centre moulded chocolate bar. The
product was launched in Calcutta, Mumbai and New Delhi during October with subsequent
launches planned in Bangalore, Chennai, Hyderabad and other mini-metros in a phasedmanner in November. Cadbury India is launching its well-known beverage Bournvita in
sachets.
1998
Cadbury's launches Picnic: Cadbury India Ltd on March 23 announced the launch of Picnic in
Karnataka. It is being made at a specially imported new line in the state-of-the-art factory
near Gwalior. Cadbury India is celebrating its golden jubilee in India. To commemorate the
occasion, the company has organised a series of events for the employees and business
associates in Mumbai, the branch offices and plant sites.
1999
Cadbury India Ltd has launched a new product, `Nice Crème', under its sugar confectioner
business. The sugar candy has been launched only in Mumbai.
2000
Cadbury's has introduced Perk Slims, a slimmer version of the wafer.
The Company has re-launched Perk, its chocolate-coated wafer; it has four new layers
covered in Cadbury Dairy Milk Chocolate. Cadbury India Ltd. has launched a range of gift
packs for Diwali.
2001
The Company has launched Sweet Nothings range of gift packs for Valentine Day.
2002
Cadbury Schweppes acquires 39.34% stake in its Indian subsidiary Cadbury India Ltd.
Cadbury Schweppes developed a new phenomenon allowing its consumers to define its
brand profile. Cadbury's market share has dipped to 70.7% due to competition. Cadbury
India tapping unconventional marketing channels like non-retail chains to drive their market
expansion.
2003
Cadbury India launches Cadbury's Heroes, which is a blend of company's leading brands.
Cadbury India re-launched its flagship brand 'Cadbury Dairy Milk'.
Brand Dossier on Cadbury
Phase One – Literature Review
2004
Amitabh Bachchan new brand ambassador for Cadbury Dairy Milk
2007
Cadbury India has rolled out a wafer-based chocolate called 'Ultra Perk' nationally. 'Ultra
Perk' has been test marketed in southern states like Tamil Nadu and Karnataka for over 6
months and is now being launched in other parts of India. The product is targeted towards
teenagers and youth. 'Ultra Perk' will be the second product offering from Cadbury in the
chocolate-wafer segment, after the 'Perk' brand.
Evolution and Transformation of Cadbury Dairy Milk
Brand Dossier on Cadbury
Phase One – Literature Review
Initial positioning and subsequent repositioning of Cadbury
Dairy Milk
After 65 years of existence, Cadbury India Ltd has five company- owned manufacturing
facilities at Thane, Induri (Pune) and Malanpur (Gwalior), Bangalore and Baddi (Himachal
Pradesh) and 4 sales offices (New Delhi, Mumbai, Kolkatta and Chennai).
Initially, the brand Cadbury Dairy Milk had a huge fan following among kids. In order to
build stronger appeal among older age groups, the brand re-positioned itself through the
classic ‘Real Taste of Life’ campaign in 1994. The campaign positioned Cadbury Dairy Milk as
the chocolate that awakened the little child in every grown up and very soon, both
teenagers and adults, were hooked on to this bar of pure magic.
With the launch of the Rs. 5 pack in 1998, CDM became more affordable and hence more
accessible for the masses. The ensuing positioning of ‘Khaane Waalon ko khaane ka Bahana
Chhayie’ made consumption into a joyful, social occasion.
In 2004, the `Kuch Meetha Ho Jaaye’ campaign was launched, seeking to
increase CDM consumption by making it synonymous with traditional sweets (Mithai). With
Amitabh Bachchan as the face and voice of the brand, the campaign went on to become a
Brand Dossier on Cadbury
Phase One – Literature Review
huge success. People could relate to the commercials that were aired to promote Cadbury
Dairy Milk. How many can forget the `Pappu Pass Ho Gaya’ commercial? Then came`Miss
Palampur’ and the country celebrated the beauty pageant with a difference. The`Kenya’
commercial that was aired in 2008 celebrated the spirit of cricket and that of true
sportsmanship. In 2009, CDM aired another commercial under the `Kuch Meetha Ho
Jaaye’ platform, called the `Pay Day’ commercial.
In the year 2010, the `Shubh Aarambh’ campaign was launched, drawing lines from the
traditional Indian custom of having something sweet before embarking on something new.
With `Shubh Aarambh’, Cadbury took the Dairy Milk journey a step further into the hearts of
its million lovers.
With the current campaign ‘Khaane Ke Baad Meethe Mein Kuch Meetha Ho Jaaye’, the
brands aim is to introduce the thought of having a CDM as a post dinner meetha (dessert).
With a large section of Indians still choosing traditional sweets (Mithai) over chocolates, an
offering was required that would seed chocolate consumption amongst non-users and help
increase consumption frequency amongst fringe chocolate users. Also, even at its lowest
price point, Cadbury chocolate was still inaccessible to majority of the rural population.
Therefore, in an effort to upgrade the Candy and Mithai eating consumers to chocolate,
Cadbury launched CDM Shots in 2008. An innovative format of sugar coated chocolate made
to withstand the rural temperature fluctuations.
Positioned as ‘chocolate laddoo’ and priced at Rs. 2 for 2 pieces, the attempt was to
introduce the product to consumers as the perfect value-for-money accompaniment for
their small celebratory occasions.
Cadbury Dairy Milk had captured the heart of Indian consumers for over six decades; but
there was room for a more premium entrant in the category. And enter CDM Silk.
Most CDM lovers thought that nothing could taste better, but CDM Silk came as a welcome
surprise! It is creamier, smoother, and tastier. Its dome shaped cubes pack more chocolate
and hence provide a superior eat experience.
Launched in January 2010, with a tantalizing taste that tempts the taste buds, CDM
Silk delivered an exquisite chocolate eating experience in the Indian market.
Brand Dossier on Cadbury
Phase One – Literature Review
Variants of Cadbury Dairy Milk in India

Cadbury Dairy Milk

Cadbury Dairy Milk Crackle

Cadbury Dairy Milk Fruit and Nut

Cadbury Dairy Milk Roast Almond

Cadbury Dairy Milk Silk

Cadbury Dairy Milk Silk Fruit and Nut

Cadbury Dairy Milk Silk Orange Peel

Cadbury Dairy Milk Silk Roast Almond

Cadbury Dairy Milk Shots
Brand Dossier on Cadbury
Phase One – Literature Review
Advertising
Chocolates have usually been viewed as something meant only for children. Perhaps
realizing that children would be attracted to any chocolate, irrespective of the brand, CIL
targeted adults with their advertising since the early 1990s. Most, if not all, of Cadbury’s
advertisements in India feature people over 18 years of age.
The message that CIL seems to be attempting to put across is this: “In every adult, there is a
child - let that child express itself, give in to temptation, and satisfy his or her desire to sink
teeth into a smooth, creamy, delicious chocolate”.
Cadbury realised that chocolates by itself do not satisfy any immediate need, so they would
have to be associated with human feelings and sentiments of romance, love and affection.
This lead to CIL coming up with many innovative advertisements for which the target group
was the viewing audience and not restricted to kids.
Campaign
Real Taste of Life
Target
Child in adult
Khanewalon
ko
khane ka bahana
chahiye
Pappu Pass Ho
Gaya
Miss Palampur
Kuch Meetha Ho
Jaaye
Wider masses
Youngsters
Rural masses
Conversion of sweet
consumers
to
chocolate for special
occassions
Khane ke baad Targeting the habit of
Meethe mein Kuch Indians
to
have
Meetha Ho Jaaye
desserts after meals
Shubh Aarambh
Shift over the years
From just for kids to
the kid in every adult
Appeal to a wider
mass based on age,
gender, etc.
Targeting the belief
of
Indians
that
anything begun by
having
something
sweet provides good
luck
Promo Mechanisms
TVC,
Print,
Hoardings
TVC,
Print,
Hoardings
TVC, Hoardings
Shift to smaller packs
This
was
an
innovative idea and
Cadbury went ahead
with
the
‘Celebrations’ packs
with these ads
From
converting
sweet consumers on
special
occasions
Cadbury now tried to
sweet consumption
for
dessert
to
chocolate as well
Converting
yet
another segment of
sweet consumers i.e.
before the start of
any work
TVC, Hoardings
TVC,
Print,
Hoardings,
Social
Media
TVC,
Hoardings,
Media
Print,
Social
TVC,
Hoardings,
Media
Print,
Social
Brand Dossier on Cadbury
Phase One – Literature Review
Phase 1:
“The real taste of life” - http://www.youtube.com/watch?v=h1W9UO74NTs
Communication Objective- Through the ad, they wanted to convey the message that
there is a child in each one of us and they wanted to appeal to that child, since children
loved eating chocolates. The ad was meant to create a particular image in the eyes of the
customer and successfully communicate what the product conveyed.
It appealed to the child in every adult and Cadbury Dairy Milk became the perfect
expression of 'spontaneity' and 'shared good feelings' In every adult there is a child let that
child express itself give in to temptation and satisfy his or her desire to sink teeth into a
smooth creamy delicious chocolate This approach appears to be unique to Cadbury.
What was Communicated- The Real Taste of Life was launched in the 1990 s. It was an
attempt to capture the child-like spontaneity in every adult. From the depiction of an old
man offering his wife a Dairy Milk chocolate to the dancing girl in crowded stadium, it all
reflected the impulsiveness and the spontaneity of the child in the adult.
Why they communicated- They wanted tore-create the image of a child in the eyes of the
adults, remind them of their childhood days and create an image that Cadbury essentially
stood for childhood and stimulate them to buy chocolate so as to make them remember the
childhood days.
What was achieved- A change in Consumer mindset that chocolates were mostly for kids
and young people. Through the campaign, adults realized they could and should enjoy
chocolates as well.
Phase 2:
“Khaane wale ko khaane ka bahaana chahiye”-http://www.youtube.com/watch?v=NjlGu5l1_IY
Communication objective- Through the ad, it was aimed at widening the chocolate
consumption among the masses and making sure the product reached a wider group of
people, based on age, sex etc.
Brand Dossier on Cadbury
Phase One – Literature Review
What was Communicated- The ad reflected the fact that Cadbury could be available and
eaten by all groups of people. In the ad, an elderly lady, middle-aged man, newly married
bride, young guy and a child are all seen enjoying Cadbury, which showed that all people,
irrespective of their sex and age could enjoy it.
Why they communicated- The ad was meant to stimulate purchase intentions and enable
the reach of Cadbury to a wider audience.
What was achieved- A widening of audience, which meant a wider market for the
product.
Phase 3:
“Pappu pass ho gaya”- http://www.youtube.com/watch?v=LyY3RXYiTyI
Communication Objective- The ad targeted youngsters and has become part of street
language. It has been adopted by consumers to express joy in a moment of
achievement/success. The ad showed association with little joys of life. The campaign urged
people to celebrate every little moment of happiness in their life with a chocolate.
What was communicated- The ad showed the coming out of results and the passing of a
person called Pappu, who had failed repeatedly. All youngsters were seen having chocolate
to enjoy their moment of success. Thus, it predominantly targeted youngsters.
Why they communicated- The ad was meant to reach out to youngsters and encourage
them to buy chocolates.
What was achieved- Enabling Cadbury to be portrayed as a product which can be had by
youngsters to celebrate their success.
Brand Dossier on Cadbury
Phase One – Literature Review
Phase 4:
“Shubbh aarambh” - http://www.youtube.com/watch?v=wcZAWeWRhaI
Communication Objective- The ad was specifically aimed at indicating a shift from the
notion of celebrating happy occasions with chocolate to the happy occasions with chocolate
to the concept of anticipating concept of something good after consuming the chocolate, a
substitute for mithai. The campaign is aimed at consumers across sectors, and is supposed
to have a balanced appeal across all tiers.
What was communicated- The ad depicted the starting if friendship over having Cadbury
and how a bonding developed over it.
Why they communicated- The ad was meant for the core group, i.e. consumers in the
age group of 15-35 years. The ad was established to remind consumers about the utility of
Cadbury.
What was achieved- Enabled Cadbury to re-establish itself in the eyes of the core target
customers.
Sales Promotion
Cadbury India Ltd as a company holds 72% of the market share in the Indian chocolate
industry. Cadbury Dairy Milk holds 20% out of the 72% market share of CIL, which makes it
the golden brand of CIL.
Cadbury as a company is a PLC. Unit for Kraft Foods. Dairy milk is the flagship product of
Cadbury in India as well as abroad and the firm doesn’t leave any stone unturned to
promote the brand which gives it the highest revenue. As far as the promotional capabilities
is concerned the company has resorted to every communication media (print, OOH, TV,
radio etc.) to create a high brand recall for dairy milk. With a sales and advertisement
Brand Dossier on Cadbury
Phase One – Literature Review
budget of nearly four hundred crores the firm can employ any promotional mechanism it
wishes and it has done full justice to the dairy milk by spending a major chunk of this budget
in the promotion of dairy milk and its variants.
Cadbury created a massive, award-winning activation in Kolkata last year in an effort to get
Bengalis to try chocolate. Now the brand is back, making an even bigger attempt to enter
Bengali hearts and minds.
Bengalis are proud of their traditional sweets - or mishti - and instead of fighting that,
Cadbury has been trying to leverage this local preference. At the same time last year - that
is, the Bengali wedding season - it launched 'Cadbury Mishti Shera Srishti' ('Cadbury plus
Mishti is the best creation').
It had had tied up with nine Kolkata Mishti shops that prepared over 100 innovative
Cadbury Mishtis - that is, sweets using Cadbury Dairy Milk as an ingredient. It used local
media and invited people to vote for the most innovative creation. The activation saw over a
million votes being cast.
Segmentation
The segmentation of the market for dairy milk is based on three things. The first one being
based geography. Geographically, Dairy Milk bars are segmented by consumer preferences
in the area and are sold more predominantly in regions which consume more snack/junk
food.
The other type of segmentation is catering to the impulse purchasers. These types of
consumers form a major chunk of the consumer base that the product caters to. Dairy Milks
are often stocked in convenience stores and the check-out aisles of supermarkets due to
impulse purchasers who are buying the chocolate for purchase and consumption now.
The other segment is the gift segment. Giving away chocolates as gifts is a trend that is fast
catching up in India Cadbury dairy milk wants to cash in on that. The latest segment that
Cadbury dairy milk is catering to is the dessert segment. The tradition of having a dessert
after meal is present in every civilization and this is a huge segment.
The latest drive of dairy milk is to become the national dessert of the country. As far as
segmenting the market on income there are different variants of dairy milk (bournville and
silk) targeted towards the higher class who are ready to pay the premium for extra dark
chocolate.
Brand Dossier on Cadbury
Phase One – Literature Review
Analysis of product and generic competition to the brand
Product: - The product Diary Milk is a chocolate bar that is made from real chocolate. The
design of the chocolate is nearly same throughout the world with slight changes that are
made according to the different regions. The amount of milk content in dairy milk is the
highest as compared to other competitors. The components that are used in making the
chocolate are sugar, cocoa butter, vegetable fats, cocoa mass and emulsifiers. The various
variants of dairy milk are Crackle, Fruit and Nut, roasted almond, shots and Silk variants.
Price: - Cadbury Dairy Milk has always adopted a competitive pricing strategy for the basic
product whereas has gone for premium pricing on the other variants. The price list is given
as follows:Product
Weight(gms)
Price(Rs.)
Dairy Milk
9.5
5
Dairy Milk
20
10
Dairy Milk
38
20
Dairy Milk Crackle, Roast Almonds
42
35
Dairy Milk Wowie
17
10
Dairy Milk
95
60
The same price is followed all across the country.
Brand Dossier on Cadbury
Phase One – Literature Review
Promotion: - Creation of a strong brand is very important in the confectionery industry.
Almost 80 percent of the chocolate purchases are unplanned and are on impulse. The media
mix for any campaign for diary milk comprises of TV, radio, print, OOH and Internet. The
advertisements are used to create and emotional bonding with the consumers and hence
are high on the emotional content. The print media is for making the consumers more
knowledgeable about the brand and digital media is used for more targeted two way
communication. Over the years dairy milk has concentrated heavily on TV advertising but
lately there is a shift towards digital media. The promotions have been done keeping in
mind to increase brand loyalty and to encourage repeat purchases at the same time
increasing market share. Apart from the mass media the other strategies include making
dairy milk a visible brand in the market and encouraging free samples through competitions
to gain trust and familiarity among the target audience.
Competitors: - The main competitors of Dairy milk in India are nestle, Mars and Amul
chocolates. The high end chocolates (Bournville 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.
Product Feature
Market Position
No of Variants
Gift Packs
Objective
Strategy
Nestle
2nd
Many
Yes
To be the world’s
largest and best
branded food
manufacturer, whilst
ensuring the brand
name is synonymous
with products of the
highest quality.
Integrated cost
leadership/
differentiation. Wide
range of products and
low cost of operations.
Amul
3rd
Few
No
Confectioneries just
happen to be a side
business for Amul,
whose core
competency lies in milk
and milk products.
Cadbury
1st
Many
Yes
To increase the market
for chocolate
confectionery and
Cadburys share in the
snacking sector.
No clear cut strategy.
Increase the market by
apt pricing strategy
that will create a mass
market and to have
offerings in every
category to widen the
market.
Brand Dossier on Cadbury
Phase One – Literature Review
Strategies adopted over time by the brand to tackle
competition or prime market expansion
Cadbury's primary objective is to drive margin gains by improving the efficiency of its
business. To achieve this, the firm had reduced stock-keeping units and scrapped 15% of its
manufacturing and distribution centres in 2011. In addition, Cadbury has placed increased
emphasis on its key brands, markets, and customers.
Price: The demand for Cadbury was limited in the lower segment since it was being sold for
Rs 22/-. Cadbury was losing market share to its competitors in the rural areas and the
children, who could not afford the amount for buying a chocolate regularly. Cadbury was
facing an issue on how to target the lower segment, so they came up with the idea of
launching different SKU’s which included packs for Rs 5/- and Rs 10/- which had a very
positive response. Cadbury also launched its premium product, Cadbury dairy milk Silk
which was priced at Rs 80/- and above. People showed their interest in buying the small
packs which in return helped dairy milk increase its market share overall.
Product: In the early 90’s Cadbury India Limited was hit with the worm controversy which
led to the reduction/fall in its overall market share. Mr. Bharat Puri who was the managing
director of Cadbury at the time, recalled all the existing stock in the market to ensure that
no defective chocolates were sold to the consumers. For the betterment of the product, in
terms of quality, Cadbury launched a double wrapped soft aluminum foil to ensure that the
product was not affected by the environment conditions/storage and transportation
shortcomings. In addition to it, regular go-down audit for the Cadbury cold store was done
along with strictly monitored pest control to avoid a repeat of any such incident. This was
done by a registered organization like PCI and GODREJ.
Promotion: During the worm controversy, in order to regain the trust and loyalty of its
consumers, Cadbury made Mr. Amitabh Bachhan the brand ambassador and released a
number of advertisements which again targeted the sentiments and feelings of people. This
slowly resulted in recovering the lost market share and trust of its consumers.
Placement: Cadbury dairy milk is a product which we can find in almost every middle and
large segment groceries. Even in medical stores they have started branding and now they
are targeting small grocery shops which can contribute in increasing the market and its
market share. The most important part which makes CDM superior from its competitors is
the quality standards, brand loyalty and its range of SKU’s. After the worm controversy
which resulted in the loss of 30% market share they have not compromised in quality. To get
the quality and taste preserved they started providing visi cooler’s for free to the retailers
Brand Dossier on Cadbury
Phase One – Literature Review
and improved their cold chain supply. This resulted in impulse buying and at the same time
quality was not compromised.
Distribution strategy followed by the brand
Cadbury India Ltd has a very strong distribution strategy across the country. The products
are sent to a storage unit in the city and then distributed amongst the distributors present in
and around that city.
For example in the city of Kolkata, there are 8 distributors at present. After studying the
retail environment CIL came up with a segmentation of retail outlets.
High end grocers (HEG) – Minimum of 300 sq ft
Low end grocers (LEG)
Food stores (apart from F&G)
Small super stores (In and outs in petrol pumps)
Stand alone stores (Like “needs”)
CIL’s strategy is to place different SKU’s in different stores depending on requirement.
According to CIL, 70% of their sales come from impulse buying, 10% from gifting and 20%
others.
CIL spares no cost in placing the required visi-coolers in retail outlets. For small retail outlets
they have a cooler that can be placed on a table/shelf. In big stores they place bigger visicoolers depending on space available. And for super stores they have a concept of 3-7 ft
(hot zone).
For example in the current month of august 2013, CIL has a plan of placing 1300 visi coolers
in the city of Kolkata alone.
The premium products of Cadbury dairy milk like Silk are sold only to those retailers who
have a visi cooler given to them by CIL.
Cadbury’s distribution network encompasses 2100 distributors and 450000 retailers.
It has a consumer base of over 65 million.
Brand Dossier on Cadbury
Phase One – Literature Review
Chocolate Market in India
others, 12%
Amul , 4%
Cadbury
Nestle , 12%
Nestle
Amul
Cadbury , 72%
others
Market share of Cadbury Dairy Milk
10%
6%
CDM
3%
5%
44%
CDM Silk
CDM Crackle
9%
CDM Fruit & nut
7%
16%
CDM Roast Almond
CDM Silk fruit & nut
(As per figures given by the distributor)
Brand Dossier on Cadbury
Phase One – Literature Review
Summary regarding the future directions for the brand
Coming to the future direction of Cadbury, they have decided to set up their biggest
manufacturing facility in the Asia-pacific region in Hyderabad, Andhra Pradesh as recently as
8th august 2013. It comes with an initial investment of more than 1000 crore in the first
phase and will go up to 2000 crore in three phases.
http://articles.economictimes.indiatimes.com/2013-08-08/news/41201963_1_cadbury-india-sricity-ravindra-sannareddy
Cadbury India Limited will be introducing a new variant in the Bournville segment namely
Bournville Mocha shortly and in smaller SKU’s than the current range.
References Used
Mr. Shravan Kedia (Distributor since 25 years for CIL in Kolkata).
http://en.wikipedia.org/wiki/Cadbury
http://www.moneycontrol.com/company-facts/cadburyindia/history/CI
http://www.mondelezinternational.com/in/en/brands/chocolate/csmkuchmeethahojaaye.a
spx
http://www.managementparadise.com/forums/marketing-management-rm-im/137529cadburys-advertising-strategy.html
http://iims-markathon.blogspot.in/2011/11/cadburys-strategy-of-positioning-dairy.html
http://thebestiims.blogspot.in/p/assignment-2-imc-plan-of-cadbury-dairy.html