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Chocolate
Group 7
An overview: Indian Market
Source: Euromonitor
Chocolate Segmentation
- By Cocoa content
Unswee
tened
Chocola
te
White Sweet
Chocol Chocol
ate ate
Dark
Chocola
te
Milk
Chocola
te
Chocolate Segmentation
- By Forms
% Sales of Chocolate Confectionery by Category: Value Sales of Chocolate Confectionery by Category: Value
140000.00
2010-2015 2010-2015 (INR miilion)
50 120000.00
45
40 100000.00
35
Other Chocolate
30 80000.00 Tablets
25 Countlines
20 60000.00 Chocolate with Toys
15
Boxed Assortments
Bagged Selflines
10 40000.00
5
0 20000.00
2010 2011 2012 2013 2014 2015
Source: Euromonitor
Other segmentation criteria
15
30% Urban
Rural
70% 10
% consumption - Age
5
13-19
0
29% 29%
20-25
26-30
30-40
19% 23%
Any snack Bar Chocolate
Any chocolate Small individual chocolates
Traditional sweets
Storage and transportation
Challenge Packaging
s High excise and import duty
Rise in cocoa price
Affordability
Meeting the
Adaptations demands for
to Diabetics
Consumers chocolate,
taste Premium
chocolates
Critical
Succes
Replacing
s Packaging
Factors
Traditional and
sweets Advertising
Increasing
Maximising
penetration
Distribution
of rural
network
marlets
Market share of companies
2014 2015
Mondelez Nestl Ferrero Mondelez Nestl Ferrero
Mars AMUL Others Mars AMUL Others
23%
24%
1% 1% 1% 1%
5% 55% 55%
5%
15%
14%
Source: Euromonitor
Competitive Landscape
Mondelez maintained the lead with 55% share in 2015
5 Star and Cadbury Dairy Milk have strong recall value when compared to
other brands in chocolate confectionery
Ferrero recorded the biggest share increase in terms of value
Chocolate is dominated by intl brands with 70% retail value share in 2015
In Feb. 2015, Nestl introduced two new variants: Senses plain milk and dark
In Nov. 2014, Rajhans Nutriments introduced its flagship premium brand
Schmitten
Premium brands continue to become more popular amongst urban consumers
but captured much lower retail value share
Source: Euromonitor
Modelez (Cadbury)
Source:
Source: Mondelez
Cadbury was market leader
Mondelez acquired Cadbury to strength its hold on Indian market
Brand strategy
Kept the Cadbury brand as it is, while introducing new products like Cadbury Bubbly
Launched a new range of Cadbury Bournvita Biscuits in India
This is done so that Mondelez can leverage the brand equity of Cadbury India
First to introduce the concept of small SKU and penetrate the rural and BOP market
In 2013, Mondelez (Cadbury) changed its packaging for Cadbury Crackle, Roasted
Packaging Almond, Fruit&Nut
to create and maintain consumer excitement
Source: Economic
Children
Advertisements In the 1960-70s, Cadbury DairyMilk was positioned to target the children
The logo one and half glass of milk was emphasized to be nutritional
Adult
In 1990s, Series of campaigns, starting with the Real taste of life'
campaign, to encourage people to bring out the child in them
Social acceptance theme with the line- 'Those who want to eat, will find a
reason for it'
Was able to gain an acceptance for chocolates among the adult audiences for
consumption
Traditional Indian sweets and desserts
Cadbury ran various campaigns under 'Kuch meetha ho jaye' including two
campaigns parallelly - 'Shubh Aarambh' and 'Meethe mein kuch meetha
ho jaye'
All the advertising campaigns was that they focused on the Indian customs
and traditions and yet they gave it a modern and contemporary look to
connect with all the people
Won awards for its campaigns
Nestle
Source:
Source: Nestle India
Nestle is a highly-diversified company operating in many
Brand strategy
different markets and sectors of those markets
It has well-established relationships with other powerful
brands, including Coca-Cola, Colgate Palmolive and General
Mills
Nestle has strong relationships with retailers
Innovation driven
Culture
Extensive centralised research and development facilities
Nestle: Recommendation
The company should create a new market for its niche products
It should spend more on advertising and brand recognition, give a more personal
touch to its products
Expand its portfolio of chocolates by investing more in R&D, move to a more
localized taste preference
Venture into Boxed assortments for festive occasions
Affordable small SKU
Home-made Chocolates
This segment is highly fragmented and operates independently
They are more pronounced for manufacturing distinct flavors and varieties of
chocolates in various shapes and size
But, these chocolates are usually priced at a higher price than that available
for branded products for the same quantity
House-wives from elite class usually indulge in this kind of business
They usually operate in local area and through their contact network
Some home-made chocolate manufacturers manufacture really attractive GIFT
CHOCOLATES for corporate gifting
Source: Internet
Boutiques
Chocolate Boutiques are a complete chocoholic experience
Manufacturers are finding an increasing number of curious customers
Cater to the older and the health-conscious choco-lovers; special range of
sugar-free and diet chocolates
Designer chocolates are tailored for customers who're looking at gifting
chocolates with a personalized touch
These designer chocolates focus a lot of attention on packaging
Eg.: ITCs Fabelle
Presence of international brands such as Schmitten and Luvit in chocolate will fuel the
forecast growth. The smaller SKUs entering rural India and expanding infrastructure
facilities across rural India will also support the growth
Chocolate with toys is expected to record the fastest value CAGR of 14% at constant 2015
prices. The increasing marketing and point-of-sale activities from Ferrero for its brand
Kinder Joy and also other manufacturers launching chocolate with toys products will help
growth
The average unit price is expected to decrease slightly due to increasing numbers of new
brands with lesser unit price and also smaller SKUs priced lower to attract rural consumers
The competition from snacks, crisps and other products will have a smaller impact on
chocolate confectionery. The increasing number of brands under chocolate will reduce the
impact
Ferrero is expected to increase its market shares if they continue their strategy
Good marketing and advertising campaigns are helping brands establish
Source: Euromonitor
References
http://www.foodnavigator-asia.com/Markets/Analysts-predict-lightning-growth-for-Indian-
confectionery-market
http://www.confectionerynews.com/Markets/Rural-India-chocolate-market-set-for-growth
http://articles.economictimes.indiatimes.com/2013-08-01/news/40963259_1_chocolate-
consumption-chocolate-market-indian-consumers
http://www.icmrindia.org/casestudies/catalogue/Marketing/MKTG287.htm
http://www.packaging-gateway.com/news/news-cadbury-india-designs-new-packaging-for-
chocolate-products-4219046
http://in.mondelezinternational.com/brand-family
http://www.businesstoday.in/magazine/features/confectionary-firm-ferrero-in-india-premium-
chocolate-market/story/204086.html
Euromonitor report: Chocolate confectionery in India
SmartResearchInsights report: 1. Assessment of the Indian chocolate market
2. Indian chocolate market- Competitive landscape