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CADBURY- SALES & DISTRIBUTION TEAM MEMBERS: 1. AGRAWAL BHAVIN (02) PROFESSOR : MR. NEERAJ RAMNANIINSTITUTE : SOM-LALIT INSTITUTE OF MANAGEMENT STUDIES (SLIMS)
History of Cadbury
1824John Cadbury began selling tea, coffee, and drinking chocolate
1824
1897
1897The first Cadbury solid chocolate bar is sold.
1905
1905Dairy Milk brand appears for the first time
1948
1948Cadbury began its operations in India by importing Chocolates
1969 1993
2009 2013
1969Cadbury buys drink maker Schweppes to become Cadbury-Schweppes
2009Acquisition by Kraft Foods: £11.5 billion (US$18.9 billion) indicative takeover bid for Cadbury
2012The confectionery business of Kraft became Mondelēz International, of which Cadbury is a subsidiary.
2012-13 Cadbury India profit slows to six year low PAT growth 2.2% under the new parent Mondelez International.
2008Cadbury Schweppes demerger took with the drinks business becoming Dr. Pepper Snapple Group Inc.
1993Cadbury opened the world's largest and most advanced chilled warehouse in Minworth, Birmingham
2012
3
2008
• Cadbury India — a subsidiary of Mondelez International, the $32 billion global snacking major formed in October last year.
• Cadbury India enjoys a value market share of over 67 percent in the chocolate category and our brand Cadbury Dairy Milk (CDM) is considered the "gold standard" for chocolates in India.
• Cadbury in India operated in five categories: Chocolates, Beverages, Biscuits, Candy & Gum.
• Snapshot of some of the most popular Brand of Cadbury:-
CADBURY INDIA
Vision & MissionVision:
"Working together to create brands people love"
Cadbury’s mission statement Says simply, ‘Cadbury means quality’; this is our promise. Our reputation is built upon quality;
our commitment to continuous improvement will ensure that our promise
Mission Statement 0f the product: The mission statement of our new product is “To provide our customers with a tempting and exquisite taste” as Enticing Treats means a mouth watering treat which is simply irresistible.
Sales and Distribution structure of Cadbury Product
Competition Medium
Unit value Low
Volume High
Unit Margin Low
Seasonality Low
Retailer’s Capital Investment Low
No. of Retailers High
Retailer’s sales Low
Manufacturer Retailer’s Relationship Low
• To become the World’s Biggest and Best Confectionery Company.
• To make lots of chocolate & improve the quality of their chocolate.
• Have loads of stores worldwide.• To be an ongoing company & achieve revenue growth
of 20% per year.• Increase earnings by 15% annually & dividends per
share by 7% per year.
OBJECTIVES
Source: Change at the chocolate factoryBy Geetanjali Shukla and Anusha Subramanian Edition:Feb 19, 2012
Cadbury India’s Market share in different segments in 2015
COMPETITORS
Achievements
Major Achievements of Cadbury• Worlds No 1 Confectionery company• World's No 2 Gums company.• World's No 3 Beverage company.• Cadbury Dairy Milk & Bournvita have been declared a "Consumer Superbrand" for 2006-07
by Superbrands India.• Cadbury India has been ranked 5th in the FMCG sector, in a survey on India's most respected
companies by sector conducted by Business World magazine in 2007.• Cadbury India has been ranked as the 7th Great Place to Work and the No. 1 FMCG company
in India in 2008, by the Great Place to Work Institute.• Asian Marketing Effectiveness Awards 2008 for Bournvita Folk/Fusion campaign - GOLD
award for the "Best Insights and Strategic Thinking" and SILVER award for the 'Most Effective Use of Advertising'.
PRODUCT
CHOCOLATE BAR.
MADE FROM REAL DARK CHOCOLATE.
SIMILAR DESIGN WORLDWIDE.
CONTAINS MORE MILK THAN ANY OTHER CHOCOLATE BAR.
AVAILABLE IN 10.5g, 22g, 95g, 165g & OTHER PREMIUM PACKS
Popular Brands in INDIAChocolates
Snacks
Beverages
CANDy’s
GUMS
PRICE
WEIGHT (gm) PRICE
10.5 5
22 10
40 20
42 CRACKLE 25
95 50
80 FRUIT & NUT 55
165 90
PRICE MENTIONED ABOVE ARE SAME ALL OVER INDIA.
COMPETETIVE PRICING.
DUE TO PRICE HIKE IN RAW MATERIAL AND LABOUR COST COMPANY HAD NOT INCREASED THE COST OF PRODUCT BUT REDUCED THE WEIGHT OF PRODUCT.
EG. 5 RS PACK WAS OF 13gm BUT NOW IT IS 10.5gm
PLACE
Business OperationsFive company-owned manufacturing facilities:
Thane Induri (Pune) Malanpur (Gwalior) Bangalore Baddi (Himachal Pradesh)
4 sales offices: New Delhi Mumbai Kolkota Chennai
Corporate/Head office: Mumbai
THESE FACTORIES
CHURN OUT CLOSE TO 8,000
TONNES OF CHOCOLATE ANNUALLY
WHOLESELLERRETAILER
DISTRIBUTION
CDM ARE SOLD DIRECTLY TO WHOLESELLER AND RETAILERS.
CADBURY'S DISTRIBUTION NETWORK USED TO ENCOMPASSES 2100 DISTRIBUTORS AND 450,000 RETAILERS.
PROMOTION
Strong brands are very important in the chocolate confectionery market.
Almost 80% of chocolate purchases are made on impulse.
The media mix for the campaign comprises TV, outdoor, Internet and radio.
Use of emotional appeals in advertising.
Concentrated more on TV. Advertisement.
• The ‘Real Taste of Life’ with the girl dancing on the cricket field
• The message: ‘Dairy Milk is for enjoyment’
A FEW ADVERTISEMENTS
During late 90’s
• Campaign: ‘Khanewalon ko khane ka bahana chahiye’.
• Target: widening chocolate consumption among the masses
More recently
• Campaign: ‘kuch metha ho jaye’.
• Target: to associate Cadbury with celebratory occasion.
• Campaign: ‘pappu pass ho gaya’.
• Target: encourage those who have pass the exams to celebrate with Dairy Milk.
• Campaign: ‘Miss Palampur’
• Target: Focusing on the adults.
• Campaign: ‘AAJ PAHLI TARIK HAI’
• Target: To celebrate pay day / salary day
Cadbury appointed Amitabh Bachchan as its brand ambassador.
The Big factor that has pushed up CDM sales is the Amitabh Bachchan campaign.
THE BIG ‘B’ FACTOR
GEOGRAPHIC SEGMENT
IMPULSE SEGMENTFOR EATING THEN AND THERE.
“KHAANE WALO KO KHANE KA BAHANA CHAHIYE”
GIFT SEGMENT PURCHASED TO GIFT SOME ONE.
segmentation
The prospective customers of Cadbury Dairy Milk have changed have changed from kids to adults-including every family member to celebrate any occasion with Dairy Milk.
TARGET MARKET
FOR KIDS ACROSS INDIA, THE WORD ‘CADBURY’ IS SYNONYMOUS WITH CHOCOLATES.
CDM POSITIONED AS ‘THE PERFECT EXPRESSION OF LOVE’
“MAZZA AA GAYA”SPONTANEOUS, CAREFREE, SPECIAL, REAL MOMENTS.
" KUCH MEETHA HO JAYE “THE BRAND WANT ITSELF TO BE SYNONYMOUS WITH SWEET.
Positioning
1905 1990 1994 2003 2014 Time
Sale
s
Introduction
Growth
Maturity
20041998
+40%
-30%
+36%
PRODUCT LIFE CYCLE
• 1905 – Cadbury launches Dairy Milk onto the market.• Positioned as ‘Unique Milk chocolate with far more milk and
creamy taste’.• In the 1980s, it was positioned as ‘the perfect expression of love’,• ‘Sometimes Cadbury can say it better than words’.• During the early1990s, emphasised its international identity, the
‘Real taste of chocolate’.• Re-positioning was done in 1994, to the ‘free-child’ in every adult. • Cadbury Dairy Milk redefined itself as the perfect expression of
spontaneous, shared good feelings, providing the ‘real taste of life’ experience.• The ‘Real Taste of Life’ with the girl dancing on the
cricket field
• The message: ‘Dairy Milk is for enjoyment’
INTRODUCTION
• 1998- The next stage of growth for the brand deals with popularizing consumption in a social context, especially in more traditional settings like weddings.
• With the campaign ‘Khaanein waallon ko khaanein ka bahana chahiye’
• Cadbury Dairy Milk aimed to substantially increase penetration levels with the award winning ‘Kuchh khaas hai.. .’campaign.
• The brand penetrated into smaller towns and sales volumes grew by 40%
During late 90’s
• Campaign: ‘Khanewalon ko khane ka bahana chahiye’.
• Target: widening chocolate consumption among the masses
GROWTH
• The ‘Worm Controversy’ resulted in Cadbury’s brand image taking a beating.
• Sales declined up to 30%.
• They had to recall a batch of chocolates. Cadbury rebuilt the trust of people by launching project ‘Vishwas’in 2004.
• Redesign of Packaging
• With Bachchan they also launched their new positioning of “Kuch Meetha Ho Jaaye” bringing in the tradition of celebrating a joyous occasion in India with sweets and now Cadbury Dairy Milk in particular.
• The “Pehli Tareekh Hai” campaigns talked about the importance of having Dairy Milk and celebrating on getting your pay on pay-day.
• “Shubh Aarambh” ads that have brought back the old charm of Cadbury Dairy Milk with its very interesting insight of mixing the traditional with the new age
MATURITY
Euromonitor predicts the industry will enjoy a 6% rise in revenues in 2014, delivering record global revenues of US$117bn. This robust performance is driven by a 2.1% increase in volume, reflecting growing appetite for chocolate in emerging markets. (Morris,2014 )
1999 2009 202002468
10
5.87.2
8.5
Consumption in World wide
year
Mill
ion
Tons
Sources:-1. A taste of Future, KPMG international-Consumer Markets June 2014, By
John A. Morris2. http://www.statista.com
The overall market size, growth trends and future
projections in the world Market
• Distribution Structure: No. of Levels
• Selection Criteria for channel Partner
CHANNEL DESIGN
Factory/Production unit
Retailers
C&F Agents
Re-Distributors
Consumers
Depot
WholesalerModern
Trade
CHANNEL OF DISTRIBUTION OF CADBURY
BUSINESS CAPACITY AND SALESMANSHIP
CREDITWORTHINESS, FINANCIAL AND SOCIAL STATUS
EXPERTISE AND EXPERIENCE
RELATION WITH CUSTOMERS
MARKET SEGMENTS
PRODUCER CHANNEL FIT
QUALIFICATION
TRAINING AND SUPPORT REQUIRED
SELECTION OF CHANNEL PARTNERS
MBA WITH 2-10 YEARS OF EXPERIENCE
CAREER PATH
ABILITY TO ANALYZE
HIGH ENERGY AND COMMERCIAL THINKING
INFLUENCING AND NETWORKING SKILLS
RECRUITMENT
• Rewards: Monetary and Non-Monetary
• Target Setting & Monitoring
• Training & Capacity Building
• Cash Flow
CHANNEL MEMBER MANAGEMENT
• General Trade Distributor Margin is around 4.75% and 1% is activity based(completion of Monthly Sales Target)
• Modern Trade Distributor Margin is around 4.5% and 0.5%
• Super Stockist Margin is around 2% and 1% of market value
MONETARY BENEFITS
• Retailers MarginProduct Margin
Bournvita 9%
Oreo 13%
Tang 10%
Halls & Eclairs Pouch 15%
Halls & eclairs Jar 12%
Health Drinks 9%
Drinking Choclate 7.5%
Choclates worth Rs. 5-20 10%
Choclates worth morethan Rs. 20 14%
• Big Bazaar has a direct account with Cadbury and there are separate margins fixed for these chains overall India by both of them mutuallyProduct Margin
Bournvita 9.45%
Choclates 11.03%
Tang 10.23%
Oreo 10.23%
MODERN TRADE MARGIN
• UDAAN: Foreign Trips to super stockists based on performance
• Visicoolers can be given only in food stores and Chemists where sales is more than 3000 per week
• SMDs can be given in Top shops where Sales is more than 2000 per week
• Mass market dispensers(Halls,Eclairs and Bubaloo gum) are given to chemists,Paan tapris
• Barrow Dispensers given to small shops and Paan Tapris
Non-Monetary Benefits
• Monthly Targets set Separately General & Modern Trade Distribution
• Incentives only after surpassing Targets• Targets Sets as on data are:
General Trade: 80-90 LakhsModern Trade: 10 Lakhs
• Monitoring Done by”Analysing Invoices” generated by the distributors & through company’s Salesforce
TARGET SETTING & MONITORING
LAKSHYA
NEW RECRUITS AND UNDERPERFORMERS
COMPANY & DISTRIBUTOR’S SALESFORCE
COST OF TRAINING
ONCE IN A YEAR
TRAINING &capacity building
THE DISTRIBUTOR–RETAILER CASH CYCLE VARIES FROM 1-7 DAYS.
IN MODERN TRADE THE CASH CYCLE IS OF 16DAYS TO 1 MONTH.
THE DISTRIBUTOR IS LIABLE TO PAY SALARY TO THE PCS BUT THE MONTHLY INCENTIVES ARE GIVEN BY THE COMPANY
THERE IS PAYMENT DONE THROUGH RTGS & PREPAID CHEQUES TO THE COMPANY
FLOW DISTRIBUTOR MAKES PAYMENT TO THE COMPANY ON A WEEKLY BASIS.
CASH FLOW
Branch Mgr
BLM (Branch Logistic Mgr)
BSM (Branch Sales Mgr)
Area Sales Mgr Area Sales Mgr Area Sales Mgr
Sales Engineer
Territory Sales In Charge
Interim Sales Representative
Super Stockist
Area Sales Mgr
BCM (Branch Commercial
Mgr)HR Mgr
SALESFORCE STRUCTURE OF CADBURY
ANNUAL MEETINGS FOR DISTRIBUTORS
"UDAAN" FOREIGN TRIP TO HIGH PERFORMING SUPER STOCKIEST
LAST YEAR TRIP TO BANGKOK & MALAYSIA FOR STOCKIEST
PREVIOUSLY TRIPS WERE TO THAILAND & DUBAI
GIFT HAMPERS
SALES FORCE MOTIVATION
EVERY PURPLE CHAMP IS ALLOTTED A SPECIFIC ROUTE TO BE COVERED IN EVERY BEAT AND HIS BEAT PLAN IS MADE FOR THE ENTIRE WEEK BY THE TSI UNDER THE SUPERVISION OF HIS TSE
USUALLY 10-12 PCS ARE APPOINTED BY A DISTRIBUTOR.
THEY REPORT DIRECTLY TO TERRITORY SALES INCHARGE (TSI).
DISTRIBUTOR'S SALES FORCE IS CALLED AS PURPLE CHAMP.
PURPLE CHAMP
INFORMATION PASSING
NEED RECOGNITION
VISIT AND CLASSIFY
REPORTING AND DAY PLAN
CONVINCE AND FINALIZE ORDER
A DAY WITH PURPLE CHAMP
COLLECTION OF CASH OR CHEQUE
ENTERING ORDER AND MAKING BILLS
CONFIRMATION OF BILL
LOOK AT VISIBILITY
A DAY WITH PURPLE CHAMP
Sr. No Parameters MOP Metro
1 Overall Value Achievements
Secondary Value 1200
2 Focus Category Volume Achievement (only one category)
Volume in tonnes 600
3 Overall MSS Improvement
65.5% 1100
4 Big hits Achievement (2 Big Hits)
100% if both30% if one
1100
Total Incentives 4000/- Month
COMPANY INCENTIVES FOR PURPLE CHAMP
• Modes of transport
• Use of IT
• Role of Third Party
Transportation & Logistics
Mainly Roadways
Retailer
DistributorTata Ace/ Magic
Production Site
Insulated Vans
MODES OF TRANSPORT
• The invoice is generated by the company and the stock is sent along with the invoice and a copy of it for the distributor.
• WINOMKAR is a software where all the data and reports are maintained and is made available for the ASMs, the BMs and SE's(Limited Access) online for making further decisions.
• Provides all the data, Performance reports Beat Wise, Outleat wise Sales Trends over the years and months and Inventory Report(MIS of company developed by Pune based ‘Heerasoft’)
• Documentation is required once a retailer enrolls for a display scheme or receives a visicooler or SMD or Fridge by the company
• Meranet is a software through which the SO reports everything on a daily basis to the ASM.
• Daily sales figures get synced here and the SO can view the summary at a glance.
• SO also mandatorily has to mail it to the ASM on a daily basis.
USE OF IT & DOCUMENTATION
Transportation
Audit
Promotion
Hiring and Payment
THIRD PARTY ROLE
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