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Project Report On Cadbury PDF
Project Report On Cadbury PDF
Project Report On Cadbury PDF
1
PREFACE
2
EXECUTIVE SUMMARY
TITLE: “ANALYSIS OF THE BUYING PATTERN OF
CADBURY CHOCOLATE IN THE MARKET WITH
RESPECT TO ITS COMPETITORS”.
Rationale of study:
The Cadbury’s Inc has taken the opportunity to offer us a broader view
of chocolate category. The Cadbury’s, India’s no.1 Chocolate, is able to
share their market insights based upon unparalleled breath of
chocolate experience. Cadbury has grown from strength to strength
with new technologies being introduced to make the Cadbury
confectionary business, one of the most efficient in the world. This
report studies about buying behavior of consumers in case of
chocolates.
3
CONTENTS
1. INTRODUCTION TO THE STUDY 05-17
Cadbury product 19
Market segmentation 21
APPENDIX 46-51
QUESTIONNAIRE
BIBLOGRAPHY
4
INTRODUCTION
5
INTRODUCTION
The Cadbury’s Inc has taken the opportunity to offer us a broader view of
chocolate category. The Cadbury’s, India’s no.1 Chocolate, is able to share their
market insights based upon unparalleled breath of chocolate experience.
Cadbury has grown from strength to strength with new technologies being
introduced to make the Cadbury confectionary business, one of the most efficient
in the world. The merger in 1969 with Schweppes and the subsequent
development of the business have led to Cadbury Schweppes taking the lead in
both, the confectionary and soft drink market and becoming a major force in
the international market. Cadbury Schweppes today manufactures product in
60 countries and trades in staggering 120. The Cadbury story is a fascinating story
of a family business that grew in one of the biggest, most loved chocolate brand
in the world.
This project is a sincere effort to study the buying behavior of
consumers when they buy chocolates. A descriptive research procedure had been
applied to come to the conclusions of the project.
A detailed questionnaire had been prepared and the responses of the
samples had been collected for the analysis. The project later concluded with
analysis of the responses keeping the limitations under consideration.
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The legend called Cadbury
1831 – By this year the business had changed from a grocery shop and John
Cadbury had become a manufacturer of drinking chocolate and cocoa. This was
the start of Cadbury manufacturing business as it is known today. A larger factory
in Bridge Street Birmingham was rented in 1847, John Cadbury was joined by his
brother Birmingham and the business became Cadbury Brother of Birmingham.
1861 – John Cadbury resigned his business and handed over to his sons, Richard,
25 and George, 21 who after 5 difficult years almost shut down the business to
take up other vocation. Fortunately for generation of chocolate lovers, they
didn’t.
1866 – Saw a turning point for the company with the introduction of a process
for pressing the cocoa butter from the coca beans. This not only enabled Cadbury
Brothers to produce pure coca essence, but the plentiful supply of coca butter
remaining was also used to make new kind of eating chocolate. The essence was
advertised as ‘Absolutely pure, therefore best’.
1879 – Business prospered from this time and Cadbury Brother outgrew
the Bridge Street factory, moving in 1879 to a ‘Greenfield’ site some miles from
the center of Birmingham which came to call Bourneville. The opening of
the Cadbury factory in a garden also heralded a new era in industrial relations
and employee welfare with joint consultation being just one of the introduced by
the pioneering Cadbury Brothers.
1899 – In this year the business private limited company – Cadbury Brothers
Limited. Progress since the start of the century through the inter – war years
onwards has been rapid. Chocolate has moved being a “luxury” item to well
within the financial reach of everyone.
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1905 – Cadbury has many famous brands with one of major success story being
Cadbury’s Dairy Milk chocolate launched in 1905, today Britain’s favorite moduled
chocolate bar.
Cadbury today is the market leader in the U.K chocolate confectionary market,
employing the most advanced processing technology and management
information and control techniques. The company is the confectionary division of
Cadbury Schweppes plc which is major force in the confectionary and soft drinks
international market. World - wide Cadbury is one of the pre – eminent
names in confectionary with impressive range of famous brands.
Quality has been the focus of the Cadbury business from the very beginning as
generations have worked to produce chocolate with that very special taste,
smoothness and snap, so characteristics of Cadbury’s chocolate.
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Cadbury’s Dairy Milk Story
Chocolate has been enjoyed by successive generation since the
manufacturing process was developed in the Victorian Times. Good chocolatiers is
an art form depending on recipe traditions, which have grown over the years.
Chocolatiers have use their skills to make balanced recipe in which all the
ingredients combine to produced chocolate with all the characteristics that
enable full delicious taste to be enjoyed by the consumers.
By today’s standards the first chocolate for eating would have been considered
quite unpalatable. It was the introduction of the Van Houten cocoa press
from Holland that was the major breakthrough in the chocolate production as it
provided extra cocoa butter needed to make a smooth glossy chocolate.
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The secret of Cadbury’s success
What is the secret of Cadbury’s continuing success first there’s the careful
selection of the finest coca beans from west Africa, as well as tasty hazel nuts
from Turkey and the fine sheet and choicest natural ingredient available to us
anywhere. Finally there’s skillful marketing Cadbury always takes extreme care in
selecting and marketing the right range of product in every cause.
The right product, the right partners, the right marketing, the
promotional back up and the right employees. These are the ingredients in
Cadbury’s latest recipes for success.
Right from the stand Cadbury Dairy Milk Chocolate success has been based on 3
factors:-
Quality
Value for money
Advertising
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NESTLE INDIA
THE NESTLE India stock has been bubbling with activity in an otherwise
listless equity market.
Till date, the stock has surged 77 per cent from its low of Rs 304 in May 2000 and
now commands a valuation 39 times the expected earnings for 2000. This is
steep by FMCG standards.
The recent surge in the stock is partly driven by the announcement by the parent,
Nestle SA, that it would use the creeping acquisition route to mop up another five
per cent in Nestle India through open-market purchases. But improving the
stock's valuation can also be traced to good financial performance in a market
starved of healthy earnings numbers.
On a comeback trail
The resumption of its coffee exports to Russia and a favorable input price
environment pepped up Nestle India's net profit growth to 28 per cent in the first
nine months of 2000. Sales growth in this period was 10.4 per cent, with domestic
sales rising 9.8 per cent and export sales 13.8 percent. In reality, the growth in
sustainable net profits was higher than reported as the company took an
additional one-time charge of Rs 14.70 crore in the first nine months of
2000 for provisions against contingencies.
Unusually, low input prices may have contributed considerably to margin
expansion. Continuing surpluses in global production have pushed both coffee
and cocoa prices (the two key inputs for Nestle India, apart from milk) to historic
lows in 2000. While coffee prices are hovering close to their seven-year lows,
cocoa prices recently bounced off their lowest levels in three decades.
With global agencies forecasting high carry-in stocks for the next season,
the soft input price advantage could be with Nestle for the time being. Does
this mean Nestle India will sustain its healthy earnings performance over the
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next couple of years? This will depend on its ability to revive sales growth in its
domestic product categories.
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Nestle's Kitkat has actually ceded market share to Cadbury's Perk in the past year.
The market for specialized food products such as soups and noodles holds
healthy growth potential. But the market is relatively small and players such
as International Bestfoods, Unilever and Dabur are vying with a host of
imported brands and regional players for a share of the pie.
13
Testing the waters
Over the past year, the company has also announced forays into three new areas
-- liquid milk, bottled water and biscuits. The foray into biscuits is through the
joint venture Excelsia Foods, so the contribution to Nestle's revenues
may at best be in the form of dividends for now.
Liquid milk and bottled water are businesses that hold immense growth
potential. Larger players can expand through higher penetration levels
and at the expense of the unorganized segment. However, both these
segments are quite crowded with feature listed and unlisted players which have
considerable financial muscle.
In the liquid milk segment, Nestle will be up against the formidable Amul, apart
from a host of private dairies with established clientele.
In the bottled water market, the market leader, Bisleri (of Parle Products),
has had to contend with competition from scores of me-too brands, apart from
Pepsi's Aquafina, Coca-Cola's Kinley. Going forward, competition is only
likely to increase, with Britannia planning to launch more bottled water
brands from its foreign collaborator Danone's portfolio (Evian, one of the
largest bottled water brands, is already on shop shelves).
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Tetrapacks. The product is priced at a substantial premium to the other local
brands.
Investment outlook: Nestle's new product forays are into extremely
competitive markets and investments in the new businesses are likely to be high
over the next few years.
In this respect, the advantage of soft input prices, high cash flows available
from the stable businesses (such as weaning cereals and coffee) and the
financial might of the parent, Nestle SA, will stand Nestle India in good stead.
The royalty to the parent should ensure that Nestle India continues to enjoy
ungrudging access to the parent's product portfolio. In many respects, in India
Nestle is pitted against its key adversaries worldwide -- Groupe Danone
and Unilever. In the foods business at the global level, both companies are
considerably smaller than Nestle SA.
But marketing prowess, rather than size is likely to determine the success
of Nestle India's new product forays in the next couple of years. Since the
high growth rates of this are partly on account of the low base of last year,
the growth rates are likely to reach more moderate levels next year.
The stock continues to be a good investment option for investors with a
three-year horizon. But since the recent uptrend is partly on account of factors
unrelated to the fundamentals, there could be some downside to the stock in the
near-term.
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OBJECTIVE OF THE PROJECT
Our main objective of the study on this project was to “analyze the buying
pattern of Cadbury chocolate in the market against its
competitors”.
This report gives the help to the marketers for analyzing the different
opportunities in the chocolate industry.
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HYPOTHESIES
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PRODUCT PROFILE
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Cadbury Product
1. Dairy Milk
2. 5 Star
3.Perk
4. Celebration
5. Temptation
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Cadbury Schweppes
Cadbury Schweppes plc, a global beverage and confectionary giant with
annual sale of Rs 20,000 crores,is the world’s number one non – cola soft drink
company having bottling and partnership operations in 14 countries and
franchises of its brand in a further 86 countries around the world. Its
Hundred Percent subsidiary in India named Cadbury Schweppes Beverage
India (private) Limited (CSBIL) started operation in March 1995. The first brand
was launched was crush which was later followed by Canada Dry, Schweppes
Tonic Water, Schweppes Bitter Lemon.
CSBIL with its franchise agreement with 19 bottles throughout India proposes to
be a household name. It has a policy for FOBOs (Franchise owned
bottling operations unlike Coke and Pepsi which prefer COBO,s (Company
owned bottling operations). In FOBO the beverages company only supplies
the concentrate and the marketing support to build brand equity. The other
aspects like machinery, bottling line, land and distribution is the responsibility of
the bottler.
As its CEO Mr. Ashok Jain says, “we are the software, they are the hardware”.
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Cadbury’s Market Segment
Market place for any product is comprised of many different segments of
consumers, each with different needs and wants. Markets segmentation
can be defined in a number of ways such as:
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The Real Taste of Rejuvenation
It was the market – leader, but sales inched along. It focused firmly on its target
segment, but the real buyer lay beyond. For seven long years, Cadbury’s Dairy
Milk chocolate suffered stagnancy even as other consumer products
boomed. Just how did the company rejuvenate an old brand to create the
marketing megs-hit of the 199s?
It Stand First Among Second coming. And it wasn’t so much a re-launch as it
was a process of rejuvenation. Over a period of 12 months, starting
February, 1994, the Rs. 314 crore confectionery makers Cadbury embarked
on the most outrageous repositioning exercise in the recent history of
Indian marketing. For, it systematically dismantled the franchise that the
company had built over 30 years of its flagship brand, Cadbury’s Dairy Milk
(CDM)-Cadbury’s Milk chocolate until 1986-destroying the very fundamentalof
generic association that had made million of Indians refer to a bar of a chocolate
as a “Cadbury”.
More proof of the chocolate is in the eating: two years into process, CDM’s
market share at 25%, with sale rising by an average 40% per annum.
The Diagnosis
Today, The Real Taste of Life campaign, which served Up chocolate in general,
and COM in particular, into the consciousness of adult, has already become
a classic of advertising and marketing. By 1993, Cadbury was desperately seeking
growth for the brand… “With a market share of 70%, trying to win
away customers from competitors in this stagnant market wouldn’t help. They
had to find new customers, people who’d never bought chocolate before. Or,
they had to increase consumption levels”. The obvious solution, in a
peculiar predicament. Despite low penetration, both the brand and the category
were displaying symptoms of age: faltering growth, high recognition, and lack
of excitement. The market research revealed the cause of the graying: chocolate
wasn’t a snack in India.
“In mature markets, chocolate straddle a continuum, from boutique
Product – packaged raw indulgence – to a casual food”. So, Cadbury whipped up
a growth solution that involved associating the brand with snacking and
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functionally, which inevitably go together with high consumption rates in the
Western markets.
The next step: identify the barriers preventing consumers from chocolate
as a snack. A battery of test, both quantitative and qualitative,
comparing chocolate consumption to a basket of competitive products
revealed an unmistakable answer.
The Tests
Despite the Need To Clear The residual memory of CDM’s former
Association, caution prevented a big break with the past, forcing
Cadbury to experiment with a combination of continuity and change. The process
entailed understanding the foundation of the brand, since it was these that
would support the new structure”. Out went the caring - and - sharing
element, but the family context stayed.
“Cadbury had two pillars, so it made sense to change one”.
Chocolate should be eaten whenever you feel like. It was an impulse item, so
why shouldn’t it be sold as one?”. The first of the two commercial focused
on functionality, purging the emotional element. Is the storyline, The father
watches TV, engrossed, gnawing away of CDM. The children enter, followed by
the mother-but, by that time, the father has completed the distinctly un
paternal act of devouring the entire bar. The children are shocked, where upon
the produces another bar for them-only to eat that up too. Finally, the mother
brings another bar out of her bag. The last shot more CDM bars strew around
casually.
The second commercial conveyed the same message, depicting four member
of a family doing their own thing on a Sunday afternoon, each casually
munching away on chocolates. The less than – subtle
message: eating chocolate’s just an everyday affair, without special occasion
or relationship coming into play. Despite their strategic intent, both ads
failed on pre – airing tests. Why for stators, children were outraged at the
idea of a parent
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consuming chocolate, while adults were down right angry at the notion of the
father depriving his children of chocolate bar. Just as important, consumer
rejected the idea that chocolate-eating could be equated with mechanical
activities like combing one’s hair. After all, chocolates were about feelings. There
had to be magic, romance, love and emotion. These elements had been
ripped away from the advertising. It was sans emotion”.
The Prescription
The crucial question that Cadbury was confronted with: what strategy should it
deploy to rejuvenate COM in a way that would appeal to the child lurking within
the adult? To inject a modern flavor into COM, they chose to create a new
brand identity, borrowing a leaf from marketing guru David Aaker, who
decrees that brand identity should establish a relationship between the brand
and the customer by generating value proposition involving functional,
emotional, or self-expressive benefits.
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“The Ads Had To Be Linkable”
“The consumer will always tell what his current belief system is, not what it
should be Cadbury’s job to mould has habits and behavior in a way that would
increase consumption for product and brand”.
The Elixir
Having decided to barter the distinctly use selfish values of sharing and caring for
the suspiciously self-centered one of self-expression, Cadbury’s people insisted
that the rejuvenate be enriched with compensation – and equally
enduring – positive values: universal truths, enduring human values, and
universal moment of joy. To translate the brief into the commercial, they
decide to simply portray occasion of childlike-but not childish-behavior from
adults, without explicitly identifying adults as the target customer.
“They left the connection to be made by the customer” “In the process they were
able to get viewer involvement and high levels of empathy. Nowhere did they
actually say, you’re an adult, you can eat it. Because nobody wants to be
told”. Thus it was that, the montage of the child in the man-the old man kicking
the football; the pregnant woman carving a chocolate; young girl breaking
into a spirit; the young man tossing a bar of chocolate at his sweet-heart
departing in a bus-was created.
That the consumption had to be liked before it could penetrate the cultural
resistance to chocolate consumption by adults was obvious. Taking a contrition
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stance, Cadbury decided to test the commercial being devised by O&M’s
creative team not for the tire battery of likeability, comprehension,
credibility and behavior modification – but only for the first two. “If asked
upfront, the consumer was hardly likely to consider the dramatically-
different idea credible. Nor was there much chance of her announcing an
immediate change in behavior”. But why likeability and comprehension?
Simple: the first was meant to be the vehicle on which the daring idea-that
adults should enjoy chocolate-would ride into the consumer’s psyche. In other
words, the commercial was meant to make him smile at first-and only then realize
the import once of the message, which is where the comprehension had to be
tested. “What was clear in this case wasthat likeability would have to include
identification and feeling warmth.”
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Dairy Milk had successfully enabled the free child in the consumer subsequent
adverting used the same communication strategy.In other words, the commercial
was meant to make him smile at first-and only then realize the import once of the
message, which is where the comprehension had to be tested. “What was clear in
this case was that likeability would have to include identification and
feeling warmth.”
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RESEARCH
METHODOLOGY
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RESEARCH METHODOLOGY
Achieving accuracy in any research requires in depth study regarding the subject.
As the prime objective of the project is to know buying behavior of
consumers regarding Cadbury with the existing competitors in the market and the
impact on Cadbury. The research methodology adopted is basically based on
primary data via which the most recent and accurate piece of first hand
information could be collected. Secondary data has been used to support primary
data wherever needed.
Primary data was collected using the following technique
Questionnaire Method
Internet
Magazines
Newspaper
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Sampling Method
Sample size- 60
Sampling procedure-
Data analysis-
The data collected through survey was analyzed with help of simple
percentages. Tabular and graphic methods, which included pie charts
and bar graphs, were used to analyze data.
30
DATA ANALYSIS AND
FINDINGS
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DATA ANALYSIS AND FINDINGS
Data was tabulated manually and was also analyzed manually. Excel was used to
make graphs had pie charts.
Cadbury % Nestle %
Below 16 yr 14 31% 6 40%
16.1-25 yr 18 40% 2 13%
Above 25 yr 13 29% 7 47%
Total 45 15
15
25%
10 cadbury
75% 5 nestle
0
Below 16 16.1-25yr Above 25
yr yr
32
2. Which sub-brand you have purchased?
12
10
8
Below16
6
16.1-25
4 Above25
0
Diary Milk 5 Star Perk Celebration Temptation
7
6
5
4 >16
3 16.1-25
2 <25
1
0
Kit Kat Munch Milky Bar Bar-One Milk Chocolate
33
3. Rank the sub-brand of chocolate according to your preference?
70
60
50
40 >16
30 16.1-25
20 <25
10
0
Diary Milk 5 Star Perk Celebration Temptation
35
30
25
20 >16
15
16.1-25
10
5 <25
0
Kit Kat Munch Milky Bar Bar-One Milk
Chocolate
34
4. How much importance do you give to the following factors when you purchase
a chocolate?
(Below 16)
14
12
10 Very Important
8 Important
6 Normal
4 Least Important
2 None
0
Flavor/taste Price Quality Packaging Brand
35
20
15 Very Important
Important
10
Normal
5 Least Important
None
0
Flavor/taste Price Quality Packaging Brand
(Above 25)
Factors Very Important Normal Least None
Important Important
Flavor/taste 13 5 1 1 0
Price 3 14 3 0 0
Quality 7 12 1 0 0
Packaging 4 7 5 4 0
Brand 1 9 7 1 2
Quantity 4 8 6 1 1
15
Very Important
10 Important
Normal
5
Least Important
None
0
Flavor/taste Price Quality Packaging Brand
36
5. At the time of purchasing chocolate, do you recall advertisement?
YES 34
NO 26
YES
57%
6. Please tick the following sources of information in term of effect, when you
purchase a chocolate? (Below 16)
Advertisement 6 10 4 0
Brand Ambassadors 5 6 1 8
Ingredients 4 7 8 1
37
12
10
8
More Effect
6
4 Effect
2 Somewhat
0
Not
Attractive Advertisement Suggestion Brand
Display inside from friends Ambassadors
store and relatives
Advertisement 5 12 2 1
Brand Ambassadors 0 6 7 7
Ingredients 10 4 4 2
15
10 More Effect
5 Effect
0 Somewhat
Attractive Advertisement Suggestion Brand Not
Display inside from friends Ambassadors
store and relatives
38
(Above 25)
Advertisement 4 11 3 2
Brand Ambassadors 2 5 6 7
Ingredients 7 11 1 1
14
12
10
8 More Effect
6 Effect
4 Somewhat
2 Not
0
Attractive Advertisement Suggestion Brand
Display inside from friends Ambassadors
store and relatives
39
7. Which form of chocolate do you like?
Hard 15
Nutties 19
Crunchy 25
Chew 1
10
6 Below 16
4 Between 16.1 to 25
Above 25
2
0
Hard Nutties Crunchy Chew
40
8. What pack do you purchase?
15
10 Below 16
5 Between 16.1 to 25
Above 25
0
Small Big Family Pack
16
14
12
10 Below 16
8
Between 16.1 to 25
6
4 Above 25
2
0
Free gifts Price offer Any other
41
11. Where do you purchase chocolates from?
15
10 Option 1
Option 2
5 Option 3
Option 4
0
Below 16 16 to 25 Above 25
Below 16 16 to 25 Above 25
Once in a fortnight 0 1 1
Daily 6 11 13
Weekly 12 1 1
Monthly 2 5 4
Quarterly 0 2 1
14
12
10
8 Below 16
6 16 to 25
4
Above 25
2
0
Once in a Daily Weekly Monthly Quarterly
fortnight
42
13. If your preferred brand is not available for repeat purchases then what will
you do?
43
CONCLUSION
Cadbury is the most preferred brand than other brands in India and Dairy
Milk is the most preferred product from Cadbury.
Flavor and packaging are most important factors that affect the buying
behavior of customer. 57% of customer recalls advertisement before buying the
product. So by our research it is concluded that advertisement affects the buying
behavior.
41% people like crunchy and 32% people like nutties chocolate. And most
of the people like small packs. Free gift are more attracting for children and price
offer schemes attracts middle group more.
44
Limitation
1. Segmentation was based on age group only.
45
APPENDIX
46
QUESTIONNAIRE
NAME-……………………………………………………………………
Cadbury Nestle
Cadbury Nestle
5Star Munch
Celebrations Bar-One
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Que4. Rank the sub-brands of chocolates according to your preference?
Cadbury Nestle
5Star Munch
Celebrations Bar-One
Que5. How much importance do you give to the following factors when you purchase a chocolate?
Flavor/taste
Price
Quality
Packaging
Brand
Quantity
48
Que6. At a time of purchasing chocolate, do you recall advertisement?
Yes NO
Que7. Please tick the following sources of information in term of effect, when you purchase a
chocolate?
effect Effect
Advertisement
Brand Ambassadors
Ingredients
49
Que11. Where do you purchase chocolates from?
Weekly Monthly
Quarterly
Que13. If your preferred brand is not available for repeat purchases then what will you do?
Que14. If another brand of the same product appears in the market, will you prefer to stop buying this
brand and buy the new brand?
Thank You
50
BIBLOGRAPHY
1. www.cadburyindia.com
2. www.nestle.in
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