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CADLEY HOMEMADE CHOCOLATE

Indias chocolate market is dominated by two just companiesCadbury, which


entered the country 60 years ago and has nearly 60% market share, and Nestl, which has
about 32%. The two have prospered by luring consumers with attractively packaged
chocolate assortments to replace the traditional dried fruits and sugar confectioneries offered
as gifts on Indian holidays, and by offering lower-priced chocolates, including bite-sized
candies costing less than 3 cents. With growth just starting to kick in, Asia is going to remain
a
sweet
spot
for
chocolate
makers
for
years
to
come.
Cadley was originally incorporated as a wholly owned subsidiary of Cadley Schweppes
Overseas Ltd (CSOL) in 1948. The companys original name was Cadley Fry (India) Ltd. In
1978, CSOL diluted its equity stake to 40% to comply with FERA guidelines. In 1982, the
name was changed to Hindustan Cocoa Products. CSOLs shareholding was increased to 51%
in Jan 83 through a preferential rights issue of Rs700mm. The current name was restored in
Dec 89. In 2001, Cadley Schweppes made an open offer to acquire the 49% public holding
in the company. The parent holds over 90% of the equity capital after the first open offer. A
second open offer has been made to buyback the balance shareholding, after which the
company would operate as a 100% subsidiary of Cadley Schweppes Plc Ever since the
Cadley is in India in 1947,
Cadley chocolates have ruled the hearts of Indians with their fabulous taste. The
company launched across India in 2010. Its one of the oldest and strongest players in the
Indian confectionary industry with an estimated 68 per cent value share and 62 per cent
volume share of the total chocolate market. It has exhibited continuously strong revenue
growth of 34 per cent and net profit growth of 24 per cent throughout the 1990s. Cadley is
known for its exceptional capabilities in product innovation, distribution and
marketing. With brands like Dairy Milk, Gems, 5 Star, Bournvita, Perk, Celebrations, Bytes,
Chocki, Delite and Temptations, there is a 1Today, the company reaches millions of loyal
customers through a distribution network of 5.5 lakhs outlets across the country and this
number is increasing everyday.

Vision and Mission statement of Cadley chocolate:


Vision: Working together to create brands people love.
Mission: To collaborate and work as teams to convert products into brands.

Objectives:
Corporate Objectives:
Broadening consumer appeal and extending reach to newer markets
Sustained growth of market share through aggressive product development
Striving for international quality in the products and processes
Focussing on cost competitiveness, productivity and innovative utilization of assets

Value chain analysis:A high quality chocolate with the taste of honey and ginger which is made by
especially cacao with honey and creates a unique image and mystic love in the mind
of the consumers with unique taste of ginger and honey.

Customer value:Cadley gives the benefits of honey and ginger with multi-speciality to the customers to make
the body healthy and fit.

Core competency:Our company gives the products with unique taste with health made by unique ingredients
Nutriceutization Cardio/Gastro.

Sustainable competitive advantage:

Our brand image fits with the customers image.

BCG MATRIX:
Relative Market Share
High
Low
M
ar
k
et
g
r
o
w
t
h
ra

High

STARS

CADLEY

LOW

CASH COWS

DOGS

STARS

The products which have high marks and high anticipated growth rate would come under this. Cadley
two major products lie under the star products. Otherwise nestle have hundreds of products and
brands. But we will discuss here only its
Major products nestle milk product and second is nestle water. These two products will lies in the
category of star products.
CADLEY
The product which have high anticipated growth rate but low market share would be considered as
cadley. The product which we are going to launch (Cadley chocolate) would come under the cadley.
Cash Cows
The products which have low anticipated growth rate and high market share would be considered as
cash cows. the products which lies under this is Cadley Milo.
Dogs
The products which have low anticipated growth rate and low market share would be considered as
Dog product of the companys the product which comes under this is Cadley corn flakes.

PORTERS Five Forces:


Threats of new entrants:
In India the competition in the chocolate business is very high. Currently many companies
are doing the business of chocolate which brand is international and others are local. From it
can be concluded that there would be a lot of chances of other international famous brands of
chocolate start their business in India.
Substitutes:
The major substitutes of Cadley would be Swiss chocolate, Hico chocolate and eat more
chocolate.
Bargaining power of supplier:
As Cadley came in India since 2010 and this is the market leader in the dairy products. As
Cadley India is already in the business of dairy so our bargaining power of supplier would be
very moderate.
Bargaining power of customer:
Bargaining power of customer would be very low because the price of our chocolate would
be fixed.

Industry rivalry:
Nestle & Cadbury are the main rivals for our industry in the chocolate market.

FCB Grid:

Situation Analysis:
Marketing Objectives:
Get more people to eat more chocolate, which calls for making it more affordable and being more
innovative

Market Analysis
The chocolates market is estimated at around 33,000 tonnes valued at approximately Rs 8.0 bn.
Cadley is the leader in Chocolate with 70% share. It has actually become the generic name for
chocolates in India.The next closest competitor to Cadley in this segment is Cadley 22%. Besides that
large foreign brands like Hersheys and local ones like ITC are trying to tread into Cadleys turf.
Imported chocolates are available via modern trade in higherend segments where Cadleys presence is
arguably weaker.

Chocolate Consumption Structure - 2010


Children
Adults
Young Adults

55%
12%
33%

percentage
60%
55%
50%
40%
33%

30%

percentage

20%
12%

10%
0%
children

Adult

young Adult

Chocolate & Confectionery Market of India 2010


0.25

0.22

0.2

0.18
0.14

0.15
0.1

0.1
Rs

0.05
0

Market Size (by value & by volume)

(%)

The Indian chocolate market is valued at Rs. 650 crores (i.e. Rs. 6.50 billion) a year. The Indian chocolate
bazaar is estimated to be in the region of 22,000-24,000 tonnes per annum, and is valued in excess of US$ 80
million. Chocolate penetration in the country is a little over 4 percent, with India's metros proving to be the big
draw clocking penetration in excess of 15 percent. Next, comes the relatively smaller cities/towns where
consumption lags at about 8 percent. Chocolates are a luxury in the rural segment, which explains the mere 2
percent penetration in villages.
The market presently has close to 60mn consumers and they are mainly located in the
urban areas.

Changing product mix Contribution to turnover 2000 Contribution to turnover


2010
400%
350%
300%
250%
200%

Year(2010)
#REF!

150%65%
100%
59%
50%
0%
Chocolate

Product
Chocolate
Sugar Confectionery 9%
Food Drinks

24%
32%

10%
9%
Sugar Confectionery

Year(2000)
59%
10%
32%

Food Drinks

(2010)
65%
24%

Cadley's India Limited Finished Products - Sales Revenue 2004 (in Rs.
Crores)

70%
60%
50%
40%
30%
20%
10%
0%

58%

4%

14%

22%

Competitors:
1. Direct comprtitors:(chocolates)

Blue Frog Chocolates (Own store)-5707 Magazine Street, New Orleans, LA (504) 269-5707
Cuccia Chocolates- 848 Decatur St, New Orleans, LA -(504) 522-7111
Rocky Mountain Chocolate- 1 Poydras St, New Orleans, LA -(504) 679-7005
Wilbur Chocolate Co- 2909 Division St, Metairie, LA - (504) 454-0124
Rocky Mountain Chocolate- 4436 Veterans Memorial Blvd, Metairie, LA -(504)
888-7787-117475713740

2. Indirect competitors:
a) Candies:
b)

Southern Candymakers- 334 Decatur St, New Orleans, LA -(504) 523-5544


Flowers:
Audubon Flowers Inc- 6101 Magazine St, New Orleans, LA -(504) 891-0208

c) Toy store:

Magic Box Toys- 5508 Magazine St, New Orleans, LA -(504) 899-0117

Competency of Cadley:
SWOT Analysis:

Strengths:
With its brand name, Cadley could counterattack the competitors it faces in the domestic
market by attacking their domestic market.
Keep up with the financial strength by increasing its sales and profit, indeed the rural
market could present higher profit opportunities than the urban products.

Weaknesses: Due to lack of distribution network, it has a small total of market share.
Opportunities:
Through its confectionary product line, least to mention is to build viable positions in
prioritized markets through organic growth and acquisition.
Cadley has other opportunities to have market development in Calcutta and Chennai.

Threats:
Consumers might shift from chocolates to Healthy snacks.
Big players brand like Nestle, Cadbury & Domestic competitors.

PEST Analysis of Cadley:


Political analysis:
Changes in laws and regulations, including changes in accounting standards, taxation
requirements, (including tax rate changes, new tax laws and revised tax law interpretations)
and environmental laws in domestic or foreign jurisdictions.

Economic Analysis:
High investment involvement in the processing of low caloric-milk product and high inflation
and FDI and GDP.

Social analysis:
Many citizens of India are practicing healthier lifestyle. This has affected the value of our
chocolate market due to honey and ginger.

Technical analysis:
Technological effort and transfer speed and rates of obsolescence are the major technological
factors.

PROBBLEM
Financial problem.
Distribution problem.
OBJECTIVE
Our product is specialized according to income bases.
Our product has capacity to touch all types of person.
It is realistic than other product.

MARKETING STRATEGY:
Our product will include features that contain the combination of both health and hygiene
keeping in mind the individual requirements in terms of taste. However marketing will be
done considering the concept of mass personage.
Our product will be tailored to individual needs (desired taste) but promotion will attract all
of them collectively. Furthermore we will be following pull strategy and approach our end
users ourselves with the help of various promotional activities. In our case no intermediary is
involved. Our distribution channel will be as follow:

PTSDAOEiffRSeGIMTrEOnNTtIiAatGIiOoNn TARGETPINOGSITEGOMNIENGTA DIOiffNer ntiation

DIFFERENTIATION
Homemade chocolates

SEGMENTATION AND TARGETING


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POSITIONING
Home made chocolates with designer packaging & endless aroma

Marketing Tactics:

p r om ot io n

p l a ce

Ma rke ti ng mix

p r ic e

p r o d u ct

Product:
Cadley chocolate

Pricing:
The price charged for a chocolate bar RS 5-10 Consumer will buy it and the level of sales achieved
can determine.

Promotion:
The basic purpose of promotion and advertising by Cadley is to make Cadley synonymous with
chocolate and Educate the market
Build brand awareness
Increase consumption
Encourage seasonal purchases

Place:
chocolate are sold directly to retailers. Distribution, in the case of chocolates, is a major deterrent to
new entrants as the product has to be kept cool in summer and also has to be adapted to suit local
tropical conditions.

Packaging
Packaging of the product is highly appealing, shelf life preventive n innovative in different
shapes & sizes.

Customer Target:
The Chocolate market presently is close to 60mn consumers and they are mainly located in urban
areas. Cadley's has successfully played the role of market leader and market maker by building brands
that have a large base of loyal consumers. Cadley had its tryst with India when it kick-started
operations in 1947. Today the brand claims a 70% share of the Indian chocolate market, despite heavy
weight competitors like Cadley and domestic giants like Amul.
Thus we understood better the chocolate market in India. Cadleys has a very good market share
currently but will have to constantly revamp their strategies in order to compete with the foreign
brands.

IMC PLAN:
Cadley PLC:
The Product Life Cycle (PLC)

Perceptional mapping

PRICING

amilyRs.5&24Fpk0g1fo8vuncteSr-hw
After the roaring success of Cadleys Munch and Chocostick, Cadleys empire struck back
hard. The Rs 5 price point accounts for more than half of all chocolate sales. Cadley had
seized the initiative at this price point, with its launch of Munch, now a roaring success (and
the largest selling product at that price point). Today, Cadley has four products at this price
point: CDM, Perk, 5 star and Gems and the five-rupee CDM bar is its single largestselling SKU. This is a potent price point in India, because the average purchasing power is
abysmally low, is what industry analyst have to say.
Cadley kicked off one of the biggest success the liquid chocolate category with its brand
Chocostick priced at Rs.2 three months ahead of competition. Cadley did react with
Chocki, priced at Rs 2, expanding the concept of sachetisation to new frontiers.Chocki has
been the single biggest growth driver for Cadley as well as the entire chocolate category. The
novelty of the format endeared itself to the existing customer. In less than one year, it
constituted nearly 10 per cent of the total chocolate market, split equally between Cadley and
Cadley.

PRICING COMPARISION

Volume led growth strategy

Cadley has followed a well-planned strategy of fuelling volume growth by introducing


smaller unit packs at lower price points. Simultaneously, the company seems to have
astutely juggled with the larger pack sizes and raised prices to a degree higher than
what appears at face. The strategy has driven volumes in the last two years and we
expect the volume growth to continue in the next two years.

PRICE WOES

Chocki, selling at a potent price point of Rs 2, was ideal for smaller towns, especially since it
did not need refrigeration. But Chocki started to cannibalise other higher-priced chocolates in
larger markets. The students of Bombay Scottish (an upmarket school in Mumbai) are not
supposed to eat Chocki, they should not have even heard of the product.

Distribution
Chocolate needs to be distributed directly, unlike other FMCG products like soaps and
detergents, which can be sold through a wholesale network. 90% of chocolate products are
sold directly to retailers. Distribution, in the case of chocolates, is a major deterrent to new
entrants as the product has to be kept cool in summer and also has to be adapted to suit local
tropical conditions. Cadley's distribution network used to encompasses 2100 distributors and
450,000 retailers. The company has a total consumer base of over 65 million. Besides use of
IT
to
improve
distribution logistics, Cadley is also attempting to improve distribution quality. To address the
issues of product stability, it has installed VISI coolers at several outlets. This helps in
maintaining
consumption
in
summer, when sales usually dip due to the fact that the heat affects product quality and
thereby offtake. To avoid cannibalization of its higher priced products from lower priced
ones, Cadley is setting up two separate distribution channels one forCORE business &
other
forMASS
markets, with different stockists, wholesalers and retailers. One set will be dedicated to
Cadleys high-end products and traditional chocolates. The other will cater to the mass
market brands namely Chocki, Halls, Eclairs et al all products priced below Rs 3. But
today, Cadley's distribution network reaches out to six lakh outlets each for its chocolate &
confectionery brands (i.e. total reaching12 lakh outlets).

Promotion
Typically it is said that chocolates are being eaten when everyone is happy. And this is
something advertising has always portrayed. But it is found chocolates are eaten under
diverse conditions and moods - when people are anxious, when they are sad, when happy - a
whole
range
of
emotions. Condensing these views & thoughts, it can be said chocolate is a true soul mate.
Someone who is with you through the ups and downs of life, helping you bounce back. And
that's what Cadley's Dairy Milk (CDM) positioned itself as - a special friend.

B
A
T

T
L

L
Buyer adoption process:
P
er
c
e
nt
a
g
e
of
a
d
o
pt

i
n
n
o
v
Early
a adopters
t
o
e
r
s
2.5%

Early

13.5%

Early
Late

lagard

34%

Time of adoption

CADLEY ADVERTISEMENTS
Dil ko jab kushi mil jaye...".wah! kya swad hai"

34%

16%

late

Akhir kam ho hi gaya. " wah! kya swad hai


Log cadley kyon khate hai.khaane waalon ko cadley khaane ka bahaana."

MEDIA 0BJECTIVE & STRETEGY


Advertising Objective:
Consumer focus:
Appealing to a broader range of consumers is at the heart of the plan.
Greater innovation in packaging & product presentation across various power brands
Suppliers and business partners:
Continue using Ethical Sourcing Standards when working with suppliers
Continue to engage in regular dialogue with its suppliers and responds to their suggestions

REACH:30% Till the end of 6 months.


frequency:it should be 3hrs per/day

COST:- it should be cost effective.


MEDIA STRETEGYReach 80% of target audience by 2011.
television-50%
Sponcership-30% & out of home+POP-20%

Promotion campaign for Sweet treat

Sweet treat For everyone

Project budget:
As Cadley is a huge and gigantic plant and needs of enormous investment to starts its
production. The project requires an estimated budget of about 200Cr. Likely we have six
partners and the contribution will be equally divided among all. Further more we acquiring
loans from the bank.

Control:
To make sure that the whole marketing process runs smoothly we will be doing :
Budget monitoring
Updating plan
Measuring objectives
Budget monitoring:
Every month the financial officer will prepare a report listing the amount of budget spent on
various promotional activities and sends it to the marketing head who will then decide if the
budget allocation needs to the modified, increased or decreased for the next month.
Updating plan:
The marketing head will continuously check the customers of the plan at the end of every
month on the bases of data provided by the sales financial and process control staff and
update the plan accordingly.

Submitted by:SAVARN KISHORE (GL) (MKT+IT)


VISHAL PAL (MKT+IT)
MANISH DUTTA (MKT+IB)
SANDESH KUMAR (MKT+IT)
MUKESH KUMAR (MKT+IB)
HARISH KUMAR (MKT+IB)