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INTRODUCTION
The origins of chocolate can be traced back to the ancient Mayan and Aztec civilizations in Central America. 'The obroma cacao', meaning 'food of the gods', was prized for centuries by the Central American Mayan Indians, who first enjoyed a much-prized spicy drink called 'chocolatl', made from roasted cocoa beans. The Aztecs introduced cocoa to the Spaniards, who took it back to Europe in the 16th century. However it was very expensive, so only the rich could afford it. Chocolate was exclusively for drinking until the early Victorian times when a technique for making solid 'eating' chocolate was devised. Throughout its history, whether as a cocoa drinking chocolate or confectionery treat, chocolate has always been much sought after. About 70% of the worlds cacao is grown in Africa. A cacao tree can produce close to two thousand pods per year. The ridged, football shaped pod, or fruit, of the cacao grows from the branches and, oddly, straight out of the trunk. The pods, which mature throughout the year, encase a sticky white pulp and about 30 or 40 seeds. The pulp is both sweet and tart; it is eaten and used in making drinks. The seeds, were you to bite into one straight out of the pod, are incredibly bitter. Not at all like the chocolate that comes from them. Its actually a perfect design. The fruit attracts forest animals, like monkeys, who eat the fruit but cast the seeds aside, dispersing them and allowing new trees to sprout up. (One of my favorite memories of a recent trip to Costa Rica was watching monkeys eating in a chocolate tree). Its hard to imagine why humans ever thought to do anything with the seeds. What is it that we do with these seeds, which we call beans, to answer the question Where does chocolate come from? First, the pods must be harvested, which is usually done twice a year. Because the trees are too fragile to climb, harvesting is accomplished by workers on the ground, who wield either a machete or a long pole with a machete on the end. Then, workers open the pods by hand, taking care not to damage the beans inside. Next comes one of the most important steps in the process fermentation. The beans, still sticky with pulp, are placed in earthen pits or wooden bins and covered with banana leaves, then left to ferment. The heat of fermentation changes the bitter flavors in the beans into something more edible, more chocolatey .The sugars in the bean turn into acids, the color changes from pale to dark brown, and the pulp residue melts away. The length of the fermentation process depends on the type of bean; the higher quality beans may need only a few days, where others may need a week or more. After fermentation, the beans are dried in the sun for about a week. The flavor continues to develop during this time. Some manufacturers try to speed this process along by drying the beans over a fire, which gives them a smoky, inferior flavor. Once the beans are dry, they are ready to be shipped to a factory, where they are turned into chocolate.
awareness regarding environment-friendly products, this segment is expected to rise rapidly in the next five years. One of the major concerns for the chocolate industry is the rising number of counterfeit products. The global chocolate market is highly consumer driven and companies need to focus on their development and marketing strategies towards capturing a larger consumer base, and acquiring new markets. Vanilla is the most preferred flavor in the chocolate industry. A number of other important flavors such as mint, coffee, strawberry, and orange are being increasingly used these days. The world enjoys various brands of blended chocolates which are available accordingly for all. The Top ten are: Kitkat, Mars, Galaxy, Cadbury, Toblerone, Patchi, Guylian, Ghirardelli, Lindt & Sprungli, Ferrero Rocher.
5.CONSUMER TRENDS
Mithai- the traditional Indian sweats is getting substituted by chocolates among upwardly mobile Indians. Instead of buying sweats on Raksha-Bandhan, sisters prefer offering chocolates to their brothers. This is the reason for sudden spurt in advertisement between July & Sep by most of the companies The range and variety of chocolates available in malls seems to be growing day by day, which leads to lot of impulse sales for chocolate companies. Chocolates which use to be unaffordable, is now considered mid-priced. Convenience over Mithai in terms of packaging and shelf life in making both middle class and rich Indians opt for chocolates. Designer chocolates have become status symbols. They are linked to ones aspiration and lifestyle and malls are perfect points of sale as people usually are happy and gay at these destinations . Cadbury initial communication for Celebrations was concentrated on occasions like Diwali and Rakshabandhan. Over the last seven to eight years, the brand emerged as a good gift proposition for occasions and enabled people to come closer. Research done by Cadbury suggested that they should extend the plank of occasion-based gifting to social gifting i.e. all-year-round gifting options. Consumers can choose from wide range of chocolates, which initially was limited to Milk chocolates like DairyMilk and MilkyBar. In past few years we have seen so many SKUs with almonds, raisins and all sort of nuts. And how can we forget latest 5 star crunchy and Ulta Perk, which has opened new windows for consumers. In past, consumers had negligible inclination for dark
chocolates. But now we have seen a change in the Indian palate, which is increasing the base of this sub-segment.
Cadbury is targeting people of age group-(3years to 18years),(18years to 25 years),&(25+years). Psychographic segmentation in this segmentation, buyers are divided into different groups on the basis of personality traits, lifestyle, or values. Cadbury has become a part of lifestyle. Behavioral segmentation-many marketers believe behavioral variable occasion, benefits, user status, usage rate, buyer readiness stage, loyalty status, and attitude-are the best starting points for constructing market segment. Occasions like Diwali, Rakhsha bandhan, new year etc are celebrated with Cadbury dairy milk package. With Respect To Product Form there are four major segments in the Indian Chocolate Industry.
Bars Segment
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This segment forms 33% of the chocolates market. This segment is mostly targeted at teenagers. Major Cadbury brands are 5-Star, Break, Real, crisp, and Double Decker. 5-Star is doing well here (about 50% of the segment) while the rest of the brands act as endorser brands. Nestle has a minor presence in this category with its product Bar-One.
Chocolate Wafers
Chocolate wafers are the new products being offered by chocolate companies today in order to expand the market. In 1995, Cadbury and Nestle launched Perk and KitKat respectively. These were waferenrobed chocolates in a new context and a different benefit offering. Both chocolates had a snack positioning. Perk offered the anytime anywhere snack proposition Thodi si Pet Puja, whereas KitKat tried to promote snacking through Have a break, Have a KitKat.
7. COMPANY PROFILE
7.1.CADBURY DAIRY MILK Cadbury is a British confectionery company owned by Kraft Foods and is the industry's secondlargest globally after Mars, Incorporated. With its headquarters in Uxbridge, London, England, the company operates in more than 50 countries worldwide. Cadbury India began its operations in India in 1948 by importing chocolates. It now has manufacturing facilities in Thane, Induri (Pune) and Malanpur (Gwalior), Bangalore and Baddi (Himachal Pradesh) and sales offices in New Delhi, Mumbai, Kolkata and Chennai. The corporate head office is in Mumbai. Since 1965 Cadbury has also pioneered the development of cocoa cultivation in India. For over two decades, Cadbury has worked with the Kerala Agricultural University to undertake cocoa research Currently, Cadbury India operates in four categories: chocolate confectionery, milk food drinks, beverage and candy & gum category. Its products include CadburyDairyMilk, Bournville,5Star,Perk,Gems, Eclairs, Bournvita Celebrations,Bilkul Bournville, Cadbury Dairy Milk Shots, Cadbury Dairy Milk Silk, Halls, Tang and Oreo.. Cadbury is the market leader in the Indian chocolate market with a share of 70% and sales of around 12000 tons. It has successfully differentiated its product over the years by strategic brand building. As the Cadburys official web site suggests, its journey in India has been an eventful one. In the early 1990s, it tried to cater to the sweet tooth of the children. Those days they steered the market and took control over the companys major market share. However, the strategy changed by letting out the secret that everyone has a child inside and thus everyone craves for the taste of chocolate. Cadbury strategies went through a considerable change. It now catered from children to adults and from chocolate to mithai. As the tagline goes Khane walon ko kahne ka bahana chahiye. VISION:- Cadbury in every pocket and Superior Shareholder Value
SWOT ANALYSIS Strength It has very strong brand equity in India. Dairy milk is reputed internationally as the topmost chocolate provider in the world. The brand is well known to people and they can easily identify it
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from others. Due to its 54 years presence in India has deep penetration 2100 distridutors;450,000 retailers, 60 mid urban(22%) customers. It is a well force in marketing and distribution. Users have a positive perception about the qualities of brand and it has a loyal market also.
Weakness Poor technology in India compared to current international technologies. There is a lack of penetration in the rural market where people tend to dismiss it as high end or luxurious product. It is mainly found in urban and semi-urban areas. It has been relatively high priced brand, which is turning the price conscious customer away. Opportunities Tremendous scope for per capita consumption(160 gms of 8-10 kg).Increasing per capita national income resulting in higher disposable income and growing middle class will give this industry a new height.The chocolate market has seen one of the greatest increase in the recent times. Chocolate is often described as recession-proof. There is a lot of potential for growth and huge population who do not eat chocolate even today that can be converted as new users. Threats There exists no brand loyalty in the chocolate market. Consumers may frequently shift their brands. New brands are coming and existing brands are introducing new variants to add up value to an already overcrowded market.
MARKETING STRATEGY (APPLYING 4PS) Product category:The products offered by Cadbury's come in many different sizes, the sizes are dependent on the market they are aimed at. Children usually have small appetites so most children's chocolate comes in small packs. A good example of this is the Cadbury's Buttons range.
1. Cadbury dairy milk 2. 5-star 3. Perk 4. Celebrations 5. Temptations 6. Eclairs 7. Gems 8. Bubbaloo 9. Bournville 10. Dairy milk silk
Price
As price is an important element of the marketing mix, the price charged for a chocolate bar can determine whether a consumer will buy the product or not . Cadbury dairy milk offers discount during festive seasons. The strategy used by Cadburys is for matching the value that customer pays to buy the product with the expectation they have about what the production is worth to them. Cadburys has launched various products which cater to all customer segments. So every customer segment has different price expectation from the product. Dairy milk Perk 5 Star Fruit and Nut Gems Break Nutties Bournvita (500gm) Rs.15 Rs.10 Rs.10 Rs.22 Rs.10 Rs.5 Rs.18 Rs.104
Place
Cadbury dairy milk is produced in factories Thane,Induri(pune),Malanpur(Gwalior), Bangalore, Baddi(H.P.) and they are at
Promotion
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Advertisement on TV, on internet, through newspaper, magazines, hording and promotion through brand ambassadors:-If an advertisement is to communicate effectively, the receiver must get half want it to, and be prepared to take step toward the sender.
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Market leader in coffee and baby food sector Well-established distribution network extending to rural areas. Strong brands in the FMCG sector. Low cost operations Large product portfolio.
Weaknesses: Low presence in health drinks: - In comparison to Bournvita, Horlicks and Boost the market penetration of MILO is very low. Low Market Share in chocolates as compared to Cadburys. Didnt get the first movers advantage. Initially the distribution focus had been on the larger cities and urban areas, which limited their customer base.
7.3. 5-STAR
5-STAR a (better) version of Mars from Cadbury (now Kraft Foods), which is extremely popular in India. Indeed, because of its spectacular market share Mars and other foreign brands couldnt stand for long in the Indian market and this wasnt due to flavors or prices.With over 40 years of being a favorite of the Indian consumer, 5 Star still continues to be what it was back then a novel concept in the chocolate world! Launched in 1969, 5 Star soon became the star of every refrigerator and pocket; people could not resist biting into one. What made 5 Star so irresistible was the unique combination of chocolate, caramel, and nougat that set a new revolution in the making of chocolates. Never before had people bitten into something so chocolaty and deliciously chewy at the same time! 5-star has been such a success in India that it would soon sweep the taste buds of other countries populations. It is an incredible example of localization of international companies understanding Indian flavors, desires and mentality when choosing chocolates they have to be closer, popular, and tasteful. In 2005, to revive the market Cadbury relaunched 5 Star (with more golden!) and also brought a new variant 5 star Crunchy for the chocolate lovers. It is the same taste with a crunch now.The variant was such a run away success that 5 Stars market share jumped by almost 50% post its launch!
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MARKET POSITIONING
What makes 5 star so popular the second largest brand in chocolates ? To a great extent, it is about the marketing. Walk into any local mart across the country and a golden bevy of chocolate beauties will arrest your eye! One of the key properties that Cadbury 5 Star is associated with, is its classic Gold color. The unique packing became the brand image of 5-star. The 5 satr taglines were also alluring and unique:
deliciously rich, youd hate to share it
lingering taste of togetherness Soft and Chewy 5 Star Get lost It was always showing the desirability of the product. One of the unique features for 5 Stars popularity is the delicious dual (5 Star is an exemplary combination of Chocolate & Caramel) eat experience that it provides to the consumer.
Bar One in terms of brand competition competed with Cadbury 5 Star. 5 Star had tremendous brand power during the nineties and Bar One could not hold out with the competition. How ever Nestle did not kill the brand but put it on the sidelines. The interesting part is that the brand was available in the retail outlets even when the brand was silent in the media. POSITIONING STRATEGY The earlier packaging was dull compared to the 5 Star's golden packaging. The package for confectionery is significant because this is a product that is bought impulsively and the packaging conveys a strong cue for the purchase. In 2010, the brand was relaunched with a new packaging and price. The new packaging is bold and lot of golden color splashed across it. After a long while, the brand had a reasonably attractive packaging. The relaunch also saw a new positioning for the brand. The brand sadly messed up on the positioning in the relaunch also. The brand came out with very poorly executed campaign positioning Bar One as a chocolate that will attract girls !!! The brand now has the tagline " Kaafi Hai " meaning " Its enough ". I really don't understand the connection between the brand and the tagline. The product, packaging and communication have been revamped. The re-launch campaign, which has the tagline, 'Kaafi Hai', targets college-goers. Nestl Bar One is available at price points of Rs 5 and Rs 10, and this new thrust is further strengthened by revamped packaging which is fresh, youthful and premium. Bar One has now returned from the back-burner with a campaign titled 'Kaafi Hai'. The catchphrase bears a double meaning. At the surface level, the message is that the chocolate is loaded with caramel and nougat, and is, hence, filling enough. At a deeper level, the brand encourages youngsters to be themselves, as that would be enough (kaafi hai) to impress the opposite gender. TARGET MARKET The target group thus comprises young, college-going boys and girls. There are three TVCs in all, two of which focus on a guy impressing girls; and one where guys are at the receiving end of female attention.
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7.5.MUNCH
Munch is one of the largest brand in the chocolate based confectionery segment in India. It is also the largest selling SKU in the industry. Munch was launched in 1999 by Nestle to counter the brand Picnic from Cadbury. But now Munch survived and Picnic is dead.
Munch is any time consumption product. The product is a wafer layer covered with delicious chocolayer. The brand is positioned based on its taste. Munch uses the tagline "Can't Stop Munching" to promote its taste as the USP. In 2004, the brand roped in the Bollywood actress Rani Mukharjee as the brand ambassador. The brand is promoted heavily across the visual media. The company has also invested heavily into the brand which has reaped rich rewards.
POSITIONING:Munch is positioned as a tasty brand. The brand is a result of the intense war between Kitkat and Perk. When Kitkat was launched, Cadbury launched Perk to flank its flagship brand Dairy Milk. The war between Kit Kat and Perk resulted in a stalemate and the category itself became stagnant. Then Munch was launched by Nestle as a price warrior. At Rs5, the brand became a blockbuster success cannibalizing Kit Kat and forcing Perk to launch a low priced variant. The prime factor behind the brand's success was the price factor. Rs5 always excited the customers to make that impulse purchase. The quantity was just right for the price and parents will have a feeling that kids are not eating too much chocolate. Munch is brand which has been innovating to keep the excitement going. Munch earlier had come out with a Coconut variant. Another major innovative variant was the Munch Pop Chocs. Pop Chocs are chocolaty nibbles in the form of wafer cubes.
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8. BIBLIOGRAPHY
1. Kotler, Philip. "Marketing Management" Analysis, Planning, Implementation, and Control Prentice-Hall, Inc. Eighth Edition 2. Internet Sources: en.wikipedia.org/wiki/Chocolate www.business.com economictimes.indiatimes.com www.cadburyindia.com/ www.nestle.co.in/nestle_india_landing.aspx www.barone.co.za/products.aspx fitho.in/health/munch-chocolate-india www.india-today.com/btoday
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