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Assignment 2 - Analysis of the Existing IMC Plan of Cadbury Dairy Milk

MARKETING PLAN
Marketing Objectives:Over the years Cadbury dairy milk has positioned itself as an all-time favorite chocolate that
is meant for all irrespective of the age, class and gender. It has been always marketed as a
chocolate having the contemporary taste but which is affordable, with several variants to
select from and over the time it has been trying to position itself as an alternative to the
traditional Indian sweet. Whereas the corporate strategies are centered towards ensuring
profitable growth in the market and grow shareholder value over the long term the marketing
strategies are more particular which can be stated a follows:-

Increase sales profit of Cadbury diary milk

Positioning diary milk as a successful alternative to the traditional Indian sweets in


order to cash in the rich tradition of Indian people associated with desserts

Sustain market share over the year through product innovation in product
development and packaging

STP for Cadbury Diary Milk:Dairy Milk chocolate bars have been in existence since 1905. Their packaging has changed,
although their promotions remain somewhat constant but the positioning has evolved over the
years. Their actual Diary Milk chocolate has not been altered over time except for when
being sold to different regions Indians like creamier chocolate than do those from England
so Dairy Milk in India contains more of a milk content.

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 type 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.

Targeting: - Starting from 1905 the purchasers of dairy milk have changed from children to
all age groups. When Cadbury started its operation in India their main buyers were children
and the youth who brought chocolates to celebrate special occasion. This limited the market
for Cadbury dairy milk. This is a reason that Cadbury came out with the campaign of (kuch
meetha ho jaye) to make dairy milk synonymous with sweet so that it could target all the age
groups. In India it was a mentality that chocolates are for children and the adults were more
inclined towards to the conventional sweets. This campaign targeted them and saw a change
in the target market for the brand. Now the target market for dairy milk is every member of
the family.
Positioning: - Cadbury Dairy Milk excels at positioning. Not only can the chocolate bars have
many different positions based on which segment they are in, but also none of the positions
damper the effects of other positions! Youth see with word Cadbury as a synonym for
chocolate, others see it as synonyms for sweet and love and bliss. In India it positioned itself
as spontaneous, special, carefree, real moments (Mazza aa gaya) in the initial stage. But
later it tried to position itself as brand that is synonymous with sweet (Kuch meetha ho
jaye). The most recent campaign (Shubh Aarambh) tries to take forward the initial
positioning of dairy milk as an alternative for the traditional sweet and positions itself as
something that is as auspicious as the sweet which is generally offered as bhog to gods.

The Marketing Mix:Product:- The product Diary Milk is a chocolate bar that is made from real dark 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 Wowie, Crackle, Fruit and Nut, Crunchie, Temptations (roasted
almond, rum raisins and raisin apricot), Bournville and Silk.

Price:- Cadbury Dairy Milk has always adopted a competitive pricing strategy for the basic
product whereas has gone for premium pricing on the other 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
42
35
Almonds
Dairy Milk Wowie
17
10
Dairy Milk
95
60
*From foodworld.esmartshop.in
The same price is followed all across the country.
Place:- The company has five company owned manufacturing capacities in Thane, Induri
(Pune), Malanpur (Gwalior), Bangalore and Baddi (Himachal Pradesh). The sale offices are
located in the metros and the head office is located in Mumbai. The distribution structure is
such that Cadbury dairy milk are sold directly to the retailers and the whole sellers. Cadburys
distribution network used to encompass 2100 whole sellers and 450,000 retailers.
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.

5C Analysis:Company:- Cadbury dairy milk is a brand of chocolate made by Cadbury Plc. unit of Kraft
Foods and sold in several countries around the world. It first went on sale in 1905 in the
United Kingdom.
Customers: - The prospective customer of dairy milk range from 5 to 60 years of age. Since
dairy milk has a range of product suited for every member of the family. The aim is to
strengthen the brand relationship in the current consumers life. The ranges of customers vary
for diary milk. Whereas some buy it as an alternative for sweet others buy it as a gift item.
The consumers mostly buy the product on impulse and are influenced by taste/flavor and then
by company/brand.
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 advantage the dairy

milk has over its competitors is the brand loyalty that it has got. The excellent advertising ,
reach and accessibility has made it the top of mind brand in the chocolate category.
Climate:- The climate for the chocolate industry and dairy milk in particular seems very
attractive in a country like India. With the size of the market being so big along with
encouraging category growth the prospects look very good. Since the product is not seasonal
and the margin is also good makes the climate for the industry even better. With new
innovations coming up in terms of product and packaging the market is still on a growth
curve.
Collaborators: - As already said Cadbury dairy milk manages a huge range of retailers and
whole sellers who make up the collaborators. Over the years the company has partnered with
various other companies like Adam Philippines in 2001 so that diary milk has a much wider
distribution network in the Philippines.

ANALYSIS OF THE
PROMOTIONAL PROGRAM
SITUATION
Internal Analysis assesses relevant controllable issues
Firms Promotional Capabilities - 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 doesnt
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 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.
Product/Service Analysis - Dairy Milk offers a range of products suited for the taste buds of
all types of consumers from nutty flavours to rich chocolate flavours. A few of Dairy Milks
product offerings are as follows:
Review of Past Promotional Programs Campaign
Real Taste of Life

Target
Child in adult

Khanewalon ko
khane ka bahana

Wider masses

Shift over the years


From just for kids to
the kid in every adult
Appeal to a wider
mass based on age,

Promo Mechanisms
TVC, Print,
Hoardings
TVC, Print,
Hoardings

chahiye
Pappu Pass Ho
Gaya
Miss Palampur
Kuch Meetha Ho
Jaaye

gender, etc.
Youngsters
Rural masses
Conversion of sweet
consumers to
chocolate for special
occassions

Khane ke baad
Meethe mein Kuch
Meetha Ho Jaaye

Targeting the habit of


Indians to have
desserts after meals

Shubh Aarambh

Targeting the belief


of Indians that
anything begun by
having something
sweet provides good
luck

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, Print,
Hoardings, Social
Media

TVC, Print,
Hoardings, Social
Media

External Analysis assesses relevant uncontrollable issues


Customer Analysis Who are the customers?
Cadbury has targeted different segments of consumers through their various ad campaigns.
From targeting kids they extended their target audience to 'the kid in every adult' through
their 'Real Taste of Life' campaign. Next they targeted the youths through their 'Pappu Pass
Ho Gaya' campaign and the rural populous through their 'Miss Palampur' campaign. The last
few of their ad campaigns have specifically been targeted towards converting consumers of
sweets to chocolates and this they have done extensively by giving consumers the idea that
chocolates could substitute sweets in ways that consumers could never think of like on
special occasions or for dessert after meals or for the auspicious start of something important.
What do they buy and how they use it?

Purchase as a gift - Cadbury Dairy Milk Celebrations

As a snack

As a dessert

Where do they buy?

Leading supermarkets and 'big chains' stores

Kirana stores

How has Cadbury tried to capture these buyers?

For those shopping at malls and supermarkets Cadbury aimed at as many as possible
using big boxes of chocolates stored near billing area to stimulate impulse buying

They also used the concept of eye level shelves to a great extent to capture the
attention of consumers

When do the consumers buy?

Impulse buying

Festive season

Special Occasions

How do they choose?


Consumers are influenced to buy a particular brand/product based on the following criteria in
the order of importance:

How they respond to marketing programs?


Consumers have till date responded very well to Cadbury's marketing campaigns. With every
new campaign, Cadbury's market share has increased and Cadbury has been able to capture
the audience targeted. Also brand loyalty has increased with the promotional campaigns.
Competitive Analysis Product
Feature
Market Position
No. of variants
Gift Packs
Objective

Nestle

Amul

Cadbury

2nd
Many
Yes
To be the worlds largest
and best branded food
manufacturer, whilst
ensuring that the brand
name is synonymous
with products of the

3rd
Few
No
Confectioneries just
happens to be a side
business for Amul
whose core
competency lies in
milk and milk

1st
Many
Yes
To grow the market
for chocolate
confectionery
To increase
Cadburys share of
the snacking sector

Strategy

highest quality
products
Integrated cost
No clear-cut strategy
leadership/differentiation
Wide range of products
Low cost operators

Environmental Analysis Porter's 5 forces Analysis:

PEST Analysis:

Growing the market


by apt pricing
strategy that will
create a mass market
and to have offerings
in every category to
widen the market

ANALYSIS OF
COMMUNICATION
PROCESS
Real Taste of Life
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.

Khanewalon ko khane ka bahana chahiye


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.

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.

Kuch Meetha Ho Jaaye


Communication Objective- The ad was meant to portray Cadbury as something which can
be had on all celebratory occasions. It projected chocolates as a substitute to mithai (sweets)
and cheered people to have chocolate on every joyous occasion.
What was communicated- The basic depiction was that the ad showed that chocolate can be
showed as being enjoyed during Diwali and any other celebratory occasions.
Why they communicated- The idea was mainly to develop preferences among people for
chocolates to sweets and stimulate the demand for chocolates in festive and joyous occasions.

What was achieved- Depiction of chocolate as a substitute to sweets and the fact that it can
be enjoyed in joyous occasions too.

Pappu Pass Ho Gaya


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 successes.

Miss Palampur
Communication Objective- The ad targeted the rural parts of India. It focused on Adults and
values, like Sacred Cow campaigns aimed at rural India did fare well. Campaigns aimed at
rural India did fare well. The share of Cadbury increased by more than 20% in rural India.
The share of Cadbury increased by more than 20% in rural India. The brand further
strengthened its positions with the core audience. The brand further strengthened its positions
with the core audience.
What was communicated- It shows a villager enjoying the success of his cow becoming
Miss Palampur. The entire village joins in the celebration, with all having chocolates.
Why they communicated- The ad was meant to increase the reach of the product to rural
areas and develop preferences for chocolates in the rural areas.
What was achieved- Enabled Cadbury to be shown as a product which can be enjoyed in
rural areas too.

Shubh Aarambh
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.

BUDGET DETERMINATION FOR SHUBH AARAMBH


CAMPAIGN
Shubh Aarambh campaign was launched in 2010, drawing lines from the traditional Indian
custom of having something sweet before embarking on something new.
We have adopted the Percentage of Sales method for budget determination of the Shubh
Aarambh campaign. We have referred the Profit & loss statement of Cadbury India Ltd for 5
years prior to the launch of the Shubh Aarambh campaign i.e. from 2005 to 2009.
Profit & Loss account (in Rs Crores)
Income
Sales Turnover
Sales Growth
Excise Duty
Net Sales
Other Income
Stock
Adjustments
Total Income
Expenditure
Raw Materials
Power & Fuel
Cost
Employee Cost
Other
Manufacturing
Expenses
SG&A expenses
SG&A as % of
sales
Total Expenses
Operating
Profit
PBDIT
Interest
PBDT
Depreciation

Dec '05

Dec '06

Dec '07

Dec '08

Dec '09

1006.02
126.24
879.78
17.87

1149.97
14.3%
91.73
1,058.24
8.71

1441.92
25.4%
148.45
1,293.47
7.68

1751.24
21.5%
162.65
1,588.59
25.07

2045.08
16.8%
110.71
1,934.37
12.67

10.44

-2.54

17.29

51.32

-16.28

908.09

1,064.41

1,318.44

1,664.98

1,930.76

246.22

441.53

563.06

732.53

832.28

19.62

20.83

25.3

29.7

37.25

94.38

93.93

107.36

130.22

150.62

138.85

57.63

76.61

96.01

6.52

292.11

302.42

366.67

432.91

624.19

29.0%

26.3%

25.4%

24.7%

30.5%

791.18

916.34

1,139.00

1,421.37

1,650.86

99.04

139.36

171.76

218.54

267.23

116.91
1.7
115.21
34.07

148.07
2.22
145.85
33.41

179.44
2.03
177.41
34.32

243.61
5.2
238.41
36.52

279.9
1.72
278.18
43.83

Other Written
Off
Profit Before
Tax
Extra-ordinary
items
PBT (Post
Extra-ord Items)
Tax
Reported Net
Profit

81.14

112.44

143.09

201.89

234.35

19.23

81.14

112.44

162.32

201.89

234.35

35.19

43.62

44.67

36.11

45.73

45.95

68.81

117.65

165.78

188.63

CAGR ( compound annual growth rate) of sales from 2005 to 2009

19.41%

Projected sales turnover for year 2010

INR 2441 crores

Average SG&A as % of sales

27.2%

Advertising and sales promotion budget as % of sales (as per 2009 data)

14%

Total advertising and sales promotion budget for 2010

INR 342 crores

Revenue break up of Cadbury India Ltd

Chocolate

65%

Confectionaries

11%

Malted health drink

24%

Total advertising and sales promotion budget for Chocolates category


Break-Up of total promotional expense (In Rs crores)

INR 222 crores

Total Promotional Expense


Advertising
Sales Promotion
Events and Sponsorship

22
2
197.14
13.93
10.92

Advertising budget breakup (in INR crores)

Print
Television
Radio
out-of-home
Online

37.5
138.0
5.9
5.9
9.9