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Institute of Practitioners in Advertising

Gold, Best Use of Insight, IPA Effectiveness Awards, 2012

Institute of Practitioners in Advertising Gold, Best Use of Insight, IPA Effectiveness Awards, 2012 www.ipa.co.uk

www.ipa.co.uk

Cadbury Dairy Milk: A meetha journey

Principal authors: Ganapathy Balagopalan and Nirav Parekh, Ogilvy & Mather India Contributing authors: Kawal Shoor and Madhukar Sabnavis, Ogilvy & Mather India

SUMMARY

This case shows how advertising re-invented the very essence of the product, so it became something different, and by doing so, unlocked brand growth for Cadbury's Dairy Milk.

It did this by transposing culture codes that got a new target audience to view a familiar brand in a new light; it became a new product, generating a desire for purchase.

The scale of the success is remarkable. After falling 78% in value, we will show how the campaign grew the business from 3% to 23% within seven years of the campaign launch.

The case shows how this growth led to a huge increase in revenue and profits; and was made possible by the advertising.

Background

Origins in India

Cadbury Dairy Milk (CDM) came to India in 1948, a year after the independent country's birth and the English had left Indian shores. This English icon has over the years grown into one of the most loved and recognized brands in India. CDM is a part of sweet childhood memories, for millions of Indians.

Circa 2004:

Cadbury was the biggest player in the chocolate market in India with nearly 65% share of the category and Cadbury Dairy Milk (CDM) its flagship brand with 31%.

CDM accounted for over half of Cadbury India's chocolate revenue in 2004, and this obviously meant Cadbury India's fortunes (read profitability) was tied to CDM's fortunes (compared to Nestle Munch its nearest competitor, which was less than 10% of Nestle India in 2004, in spite of being more widely available than CDM).

CDM was obviously Cadbury India's bread and butter brand and to most Indians:

Chocolate = Cadbury = Cadbury Dairy Milk.

Market Situation

While the 90's were kind to Cadbury, by early 2000's growth began drying up.

The flattening of sales is obvious – between 2000 and 2004, CDM growth rate dropped

The flattening of sales is obvious – between 2000 and 2004, CDM growth rate dropped by 78% over the previous four year period from 1996 to 2000.

by 78% over the previous four year period from 1996 to 2000. CDM growth was running

CDM growth was running out of fuel. We had to find new triggers to fuel growth. However, given CDM's criticality to Cadbury bottom-line, we had to manage growth without compromising profits.

BUSINESS OBJECTIVE

Grow CDM top line (Sales Value) without compromising profitability

CHOOSING THE GROWTH DRIVER

A. Market share of all Cadbury brands put together was already 65%.

Playing a share game would inevitably entail cannibalizing own brands

B. CDM's competition came primarily from VFM offerings (chocolate-coated wafer biscuits had lower chocolate content or, worse, used chocolate substitute; and this meant these brands offer more for less – discernibly bigger bars than CDM for same price).

Clashing with them for share was bound to be unprofitable.

D. Possibility of share gain through promotions was bound to be expensive and unlikely to

D. Possibility of share gain through promotions was bound to be expensive and unlikely to sustain long term growth. Moreover, the inevitable competition response, compounded by price pressures discussed in point 'C' above,would further erode profitability.

All these factors appeared to suggest growing market share may not be the most profitable growth avenue for CDM.

THE WAY TO GROWTH

Cadbury had started out by selling to kids, as it was felt it is easier to develop a new taste with kids than with tradition-bound adults; but the approach created an unexpected roadblock for further growth. We had become an occasional foreign treat 'for kids'. As people grew up, they grew out of chocolate instead of growing up with it.

Consumption among Teens and Adults was very low.

up with it. Consumption among Teens and Adults was very low. MARKETING OBJECTIVE Increase CDM penetration

MARKETING OBJECTIVE

Increase CDM penetration among teens and adults

COMMUNICATION CHALLENGE

Indians had made the English language, Tea, and, of course, Cricket their own, but strangely an innocuous sweet treat 'Chocolate' had got the cold shoulder from the average, tradition-bound, Indian adult.

It's not as though they lacked a sweet tooth.

Size of the traditional meetha (sweets) market was more than 19 times that of chocolate; valued at approximately US$4.2 billion, while chocolate was merely about US$215 million.

The magnitude of the opportunity was matched by the magnitude of the challenge. A culturally

The magnitude of the opportunity was matched by the magnitude of the challenge.

A culturally antagonistic product, chocolate was a foreign sweet-treat trying to change sweet-eating habits of a country with a vast

indigenous sweet tradition of its own that was several centuries old.

Chocolate had not found its barrier-breaker.

STRATEGY

Our growth strategy was simple. Grow chocolate consumption BY making it part of Indian meetha (sweet) consumption behaviour.

To do this, we attempted to understand why we were not considered in traditional 'meetha' eating occasions, by mounting an ethnographic research of sweet consumption behaviour.This exploration led us to a defining strategic discovery.

Difference in cultures and cultural perspectives of happiness between the east and the west was the crucial link to understanding differences in sweet consumption behavior and its implications for communication.

The west has a strong belief in independence and autonomy of the self (individualism). The self is believed to be the center of thought,

action and motivation; and happiness is to be found in personal striving and fulfillment of desires. Chocolate was mostly a private craving,

a means for self pleasure. A lot of chocolate advertising Cadbury Gorilla, Dove / Galaxy campaigns reflects this individualistic cultural perspective of happiness.

Sharply in contrast, happiness in India is 'collective'

In East-Asian cultures, the self-in-relationship-with-others (collectivism) is the locus of thought, action and motivation. Consequently, happiness tends to be defined in terms of interpersonal connectedness and realization of social harmony.

This connects strongly to sweet consumption behavior/ occasions in India.

Most happy occasions tend to be collective and are ritually accompanied by meetha consumption. Festivals, Celebrations, and traditions/ cultural markers of anticipated happiness (child birth, success in exams, starting a new business etc.) are never in short supply!

One could argue that it is not as if people in the West did not celebrate such happy occasions together, but surely there is no ritual mandating sweet consumption. Only in India does sweet (meetha) perform the role of a happiness ritual.

In sum:

Chocolate = self indulgence

Meetha = shared happiness ritual

In hindsight, we realized that as a consequence of its western heritage, much of CDM's communication in India before 2004 reflected these western, individualistic happiness codes and was, hence, not considered on meetha consumption occasions.

This understanding of how 'meetha' was different from 'chocolate' was the heart of our new strategy.

We decided to re-purpose chocolate (CDM) as meetha in order to get a share of meetha occasions.

Creative Solution

Associate CDM with Indian sweet (meetha) consumption occasions so that it gets consumed on meetha occasions).

How did we do this?

If we had to make Cadbury Dairy Milk synonymous with 'meetha', we need the word 'meetha' to become synonymous with the brand.

Traditionally, people sweeten other people's mouth when something good happens to them or when they want to wish other happiness. Festivities/ celebrations are its natural outcome. This practice is popularly captured by the Indian / Hindi phrase "Muh meetha karna".

We made this more actionable by re-inventing it.

CDM advertising signed off with an invitation: 'Kuch Meetha Ho Jaaye!' – A call to have something sweet.

Turning the "Kuch Meetha Ho Jaaye" idea into advertising

Over the years, our executions have spanned all traditional meetha occasions: Celebrations, Shubh Aarambh (new beginnings of all kinds – journeys, new jobs, new purchases, starting a job, forming new relationships –all typically Indian collective sweet consumption occasions).

The meetha consumption ritual is an inevitable part of these occasions.

CDM Tone of Voice

Meetha NOT Chocolate

Collective NOT Individual,

Relevance (Occasion) NOT just a feeling

Indian / Hindi NOT English

Media Logic

Given that we were targeting the masses, it was important to reach a very wide audience. TV proved to be the most efficient medium for this. For all the campaigns, TV was the lead medium of advertising, with 80%-90% of investments put in TV.

of advertising, with 80%-90% of investments put in TV. The rest of investments were spread across

The rest of investments were spread across radio, outdoor, digital and POS, with the objective of maximizing impact, and driving engagement with the consumers.

Communications History since 2005

Consistency of the 'KMHJ' proposition over the last 7 years has helped CDM become '
Consistency of the 'KMHJ' proposition over the last 7 years has helped CDM become '

Consistency of the 'KMHJ' proposition over the last 7 years has helped CDM become 'Meetha'

Consistency of the 'KMHJ' proposition over the last 7 years has helped CDM become ' Meetha

Results

What Happened:

1: BUSINESS OBJECTIVE

Grow CDM top line (Sales Value) without compromising profitability

CDM GROWTH ZOOMED

Value) without compromising profitability CDM GROWTH ZOOMED Moreover, despite being the biggest brand in the category

Moreover, despite being the biggest brand in the category (and therefore having a larger base compared to others), CDM managed to grow faster than every competitor brand.

therefore having a larger base compared to others), CDM managed to grow faster than every competitor

SALES GREW

Clearly, the shift in strategy and the Kuch Meetha Ho Jaaye campaign not only reversed

Clearly, the shift in strategy and the Kuch Meetha Ho Jaaye campaign not only reversed the flattening growth rate, but also super-charged CDM growths!

2: MARKETING OBJECTIVE

Increase CDM penetration among teens and adults

LEADING TO MORE PEOPLE EATING CHOCOLATE / CDM

and adults LEADING TO MORE PEOPLE EATING CHOCOLATE / CDM As targeted, the shift in strategy

As targeted, the shift in strategy did show results. It got noticed and reported by newspapers too, that chocolate was being considered on occasions when traditional meetha were the original choice.

The impact showed up in our tracking studies too. By 2011, penetration of chocolate is over 90% for both teens and adults segments. As we see later, CDM was the biggest brand capitalizing this explosive growth in the chocolate category.

Why it Happened 3: Communications objective CAMPAIGNS BECAME FAMOUS AND MUCH ENJOYED CDM campaigns enjoyed

Why it Happened

3: Communications objective

CAMPAIGNS BECAME FAMOUS AND MUCH ENJOYED

CDM campaigns enjoyed the highest recalls across all brands advertised during the 7 year period.

FAMOUS AND MUCH ENJOYED CDM campaigns enjoyed the highest recalls across all brands advertised during the
" Cadbury's buzz definitely emanates from its advertising ", reads 'India's Buzziest Brands' list

"Cadbury's buzz definitely emanates from its advertising", reads 'India's Buzziest Brands' list compiled by afaqs.com, India's largest website on advertising and media industry. Cadbury has consistently been in the top 20 brands from 2006 to 2012, and it has climbed up the ranks over the years.

The 2012 report said: "In a list dominated by digital and mobile brands, Cadbury was the only FMCG brand in the top ten of the 7 th edition of the list."

in the top ten of the 7 t h edition of the list ." rediff.com ,

rediff.com, India's leading news and entertainment portal listed CDM's 'ShubhAarambh' campaign as one of the most viewed ads of 2010.

campaign as one of the most viewed ads of 2010. People chose to see and share

People chose to see and share the campaign:

On YouTube, CDM's Shubh Aarambh [2010] and In-Home [2011] campaigns have got viewed more than 1 and 1.2 million times

respectively. This led to Cadbury India's YouTube channel becoming the 3 rd most watched YouTube channel in India in 2011. Madison data estimates that 2.2 million YouTube views translate to a free PR valuation of about INR 1 crore (about US$ 200,000) – equivalent of what

many brands spend on their Internet campaigns in India in a year.

On Facebook too, Cadbury Dairy Milk is more popular than its competitors. While Nestle Munch does not have a presence on Facebook, Nestle Kit Kat has fewer likes and fewer people talking about it as compared to CDM.

likes and fewer people talking about it as compared to CDM. User Comments on YouTube and

User Comments on YouTube and Facebook depict how engaging and loved the ads were:

Awesome ads from cadbury….good ads love to see? it again and again

Yeay.!! This ad is? back on tv. !! <3 <3

After a long time, I have seen a nice TVC. Today I asked my wife and she was surprised when I told her, would you give me a bite of chocolate? Ha hahaha.

No matter how many times I watch this…I can't get enough of this ad. It's short, sweet and it expresses the same emotions in 40 secs that a movie takes about 3 hours to say.

Real moment is when I share my preserved Dairy Milk with my family… n smiles on everyone's face makes me feel like heaven…

Today is a 'Kuch Meetha Ho Jaye' moment 4 me… Coz finally my exams got over…

CAMPAIGN POPULARITY LED TO BRAND BECOMING POPULAR AS MEETHA

Cultural popularity

LED TO BRAND BECOMING POPULAR AS MEETHA Cultural popularity The signoff line ' Kuch Meetha Ho

The signoff line 'Kuch Meetha Ho Jaaye' got used by many newspapers and websites as headlines for articles on sweets, sugar, chocolate, etc. Not just that, a 2005 Bollywood movie, on people drifting apart in their relationships and coming back together, used the line as its title.

Even the lines used in the sub-campaigns got mashed up, and used in newspaper headlines. In fact, a tabloid adopted the line 'Pappu Pass Ho Gaya' (our 2005 campaign) for advertising itself!

Moreover, the line from our 2009 'PayDay' campaign – Khush Hai Zamana Aaj Pehli Tarikh Hai (Everyone's happy because today's PayDay) – got used by the Minister of Finance in his Budget speech. He said: Khush Hai Zamana Aaj Budget Ki Tarikh Hai (Everyone's happy because today's Budget Day).

His pro-middle class budget led to a newspaper headline quipping "PayDay for Bharat" the next day.

Impact was seen at a personal level too. The strong 'celebrations' connect with Cadbury Dairy Milk led to trends like using the packaging of CDM as a wedding invitation card.

Impact seen in brand track results:

1. The campaign created a new need-state hitherto unheard of – the need to celebrate happy moments.

unheard of – the need to celebrate happy moments. Data on this need-state is not available

Data on this need-state is not available post 2007. This is because from 2007 onwards, tracking shifted from happy moment as a need- state, to specific occasions on which CDM was preferred.

2. From 2004 to 2007, preference for Cadbury Dairy Milk across all TGs, saw a big increase across celebratory occasions; an average of

34% in large towns, and even higher at 40% in small towns.

34% in large towns, and even higher at 40% in small towns. 3. In 2010, the
34% in large towns, and even higher at 40% in small towns. 3. In 2010, the

3. In 2010, the Shubh Aarambh campaign tapped into a cultural habit of eating something sweet as a good-luck ritual before starting

something new, and asked consumers to replace meetha with chocolate on those occasions. In less than a year's time, this attitudinal

change received high acceptability among teens, and moderate acceptability among adults.

among teens, and moderate acceptability among adults. Further, among those who said they would have chocolate

Further, among those who said they would have chocolate before starting something new, 86% teens and 79% adults said they would consume CDM.

Evidently, our advertising again created a new occasion for consuming chocolate (and CDM): 'before starting something new'.

Appreciation from Industry:

Accolades haven't stopped since the Meetha campaign began in 2004. A special mention in the context of this case, is what Mr. K V Sridhar, the National Creative Director of Leo Burnett, said after the 2010 Shubh Aarambh campaign: Cadbury has shown the path for others to follow and create a meaningful difference in the lives of people. So, let us not tell ourselves that we're 'just' in the business of making ads but rather in the business of transforming human behavior.

4: PROVING ADVERTISING GREW SALES AND NOT OTHER FACTORS

Was it seasonality?

No. Given the long term nature and consistent annual rate of the growth, effect of seasonality is obviously not relevant.

Was the growth because of better price-value equation for CDM?

No. Volume growths came despite grammage reduction. This was compelled by global increase in raw material (cocoa, sugar, etc.) costs.

global increase in raw material (cocoa, sugar, etc.) costs. Not just that, CDM's key competitor, Nestle

Not just that, CDM's key competitor, Nestle Munch, consistently offered a better price-value equation as compared to CDM. Over the 7 years, Munch's weight for the same-price SKU remained higher than that of CDM.

This is important because competition (Munch) was less affected by the commodity price increase as it is wafer-coated in chocolate (requiring less chocolate and moreover made use of cocoa-butter-substitute, a cheaper input material).

This indicates that advertising helped make the brand price-inelastic, and helped the brand to command a relative price premium).

Was it because of promotional activities?

No. Given price pressures,promotions were few and far in between.

So, was it distribution?

Distribution has, indeed, increased over the 7 year period, but one could argue the extent of causality between distribution and sales. While it could have led to growth in penetration, it would have limited impact, if any, on growth in frequency of CDM consumption.

As the below data shows, frequency of CDM consumption grew by more than 3.5 times from 2002 to 2011. To this extent, impact of distribution is definitely not the driving factor in CDM's growth.

is definitely not the driving factor in CDM's growth. Additionally, the growth in Per Dealer Off-take

Additionally, the growth in Per Dealer Off-take shows that the growth in CDM sales was not achieved purely by adding new outlets. The fact that this growth was much higher than that of Nestle Munch further proves this point.

higher than that of Nestle Munch further proves this point. Moreover, if distribution was the key

Moreover, if distribution was the key sales driver, Munch should lead CDM in sales; since throughout the 7 years, Munch was more widely available than CDM.

Although Munch has the value advantage, and is more widely distributed, CDM outperforms Munch on

Although Munch has the value advantage, and is more widely distributed, CDM outperforms Munch on both absolute sales and rate of growth, as shown earlier.

Is it that CDM's growth then, was because of product?

No. The product taste has stayed unchanged for over a decade! And no new SKUs have been launched since 1998.

Was it packaging then?

No. CDM underwent just one marginal packaging change (to accommodate global brand guidelines; and the change was not advertised). Clearly, given the long term nature of the results, packaging change impact cannot be the growth engine.

Was it because of lower competition in the chocolate category?

No. The period 2005-2011 saw the launch of 25 new chocolate brands,and the launches were supported by TV advertising too.

Was it high SOVs then?

No. An analysis of sales and GRP inputsfor the campaigns, using econometric modeling, shows that the effectiveness of our media inputs improved over the years.

the campaigns, using econometric modeling, shows that the effectiveness of our media inputs improved over the

Was it macro-economic variables then, like growth in indulgent behavior?

No. In fact, these years saw an increase in incidence of diabetes and other lifestyle diseases in India. Further, there was no reduction in advertising related to healthyeating, and sugar-free products.

related to healthyeating, and sugar-free products. In addition to these points, the high correlation between

In addition to these points, the high correlation between CDM Sales and GRPs (0.933) goes on to show the extent of contribution advertising has made to sales growth.

extent of contribution advertising has made to sales growth. All this leads us to conclude that

All this leads us to conclude that CDM's advertising is the key driver for its superior growth.

That advertising contributed significantly to sales growth and ROI is further validated using econometric modeling.

5. PAYBACK AND ROMI

Cadbury in India is a private company and, as a company policy, does not share financial data. So the exact contribution of advertising must remain confidential. Hence, they have been presented only as estimates.

We already know that over the campaign period of 2005 to 2011, brand revenues have grown by 26% CAGR. Additionally, brand profits grew at an impressive 28% CAGR.

The econometric model further asserts that both revenue and profit ROI for individual campaigns have consistently grown over the years.

The power of " KuchMeetha Ho Jaaye " proposition can be further proven by assessing
The power of " KuchMeetha Ho Jaaye " proposition can be further proven by assessing

The power of "KuchMeetha Ho Jaaye" proposition can be further proven by assessing its effectiveness as against other super performing Cadbury / Kraft campaigns from around the world.

The record breaking CDM Gorilla delivered 197 kg/ GRP. The "Kuch Meetha Ho Jaaye" campaigns delivered a whopping 520 kg/ GRP. In fact the econometrics data tells us that the "Kuch Meetha Ho Jaaye" campaigns are more effective at growing sales than all other Cadbury/ Kraft campaigns from around the world!

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